Brief Summary

Defamation — Media publication — Applicants sought a permanent interdict against the publication of articles alleging fraud related to pension fund contributions — The articles published by the first respondent referenced the second applicant but not the third applicant — The court found no justiciable dispute concerning the third applicant, as he was not mentioned in the articles — The statements regarding the second applicant were deemed not defamatory as they were based on information from the pension fund administrators and did not imply guilt — Application dismissed.

Comprehensive Summary

Summary of Judgment

1. Introduction

The proceedings were an urgent application that initially served before Snellenburg AJ on 17 May 2022, when interim relief was granted by agreement between the parties. The matter subsequently returned to court on the return date, where the applicants sought the confirmation of a rule nisi and, ultimately, a final (permanent) interdict.

The applicants were Defensor Electronic Security Systems (Pty) Ltd (the first applicant) and two individuals described as its directors, Gert Renier van Rooyen (the second applicant) and Claudius Gerald Peterson (the third applicant). The respondents were Africa Community Media (Pty) Ltd (the first respondent), a media entity that published the relevant online articles, and the Minister of Police N.O. (the second respondent), cited as the executive authority responsible for formations within the South African Police Service (including the Hawks).

The dispute concerned the alleged unlawfulness and defamatory character of online reporting and a Hawks media statement describing criminal allegations involving the applicants. The applicants’ case was framed as a complaint that the respondents had published a false report, particularly regarding the use of the term “fraud” and the publication of an amount said to be R14 million, and that the publications threatened harm to reputation and business interests. The respondents opposed confirmation of the rule nisi and the grant of final interdictory relief.

2. Material Facts

It was common cause that, at all relevant times, the second and third applicants were directors of the first applicant, a security company conducting business in the Free State and Northern Cape.

On 9 May 2022, the second and third applicants appeared in the Magistrate’s Court, Kimberley on charges said to relate to contraventions of provisions of the Pensions Act 24 of 1956 (also referred to in the papers as the Pension Fund Act 24 of 1956). The main allegation described in the judgment was that employees’ contributions were deducted from salaries and the employer portion was not paid over to the pension administrators. The judgment recorded that, according to annexures to the charge sheet, the total amount owed by the first applicant was R817,892.82.

After the court appearance, a journalist employed by Independent Online SA (Pty) Ltd published an article on the online platform of the first respondent on 9 May 2022 titled “Security boss in court for R14m pension fund fraud”. A second article with the same headline and including a photograph of the second applicant was published on 10 May 2022; it was described as a report on a statement issued by the Directorate for Priority Crime Investigation (the Hawks). The judgment recorded as common ground that these two articles did not mention the third applicant, notwithstanding that his name appeared on the charge sheet.

The second respondent’s version, as summarised by the court, was that a complaint had been received from a former employee of the first applicant about outstanding contributions, leading to an investigation that revealed a prima facie case. The court further recorded that an affidavit by Fatima Cassim, on behalf of the pension administrators (Salt Employee Benefits (Pty) Ltd), disclosed a larger deficit of contributions not paid over. On 9 May 2022, a Hawks employee published a media statement on several media platforms identifying the allegations as contraventions of the pension legislation and reporting the amount as R14 million. The judgment stated that this figure was said to include amounts not paid over and penalties.

As to the litigation posture by the time of the return date, the court noted that pursuant to the interim order of 17 May 2022, the “offending article” had been removed from all media platforms, and the second respondent argued the matter had become moot.

3. Legal Issues

The central legal questions the court was required to determine were whether the applicants had established entitlement to final interdictory relief confirming the rule nisi, and whether the publications and statement complained of were defamatory or otherwise unlawful on the facts presented in motion proceedings.

The dispute involved a combination of application of law to fact and evaluative assessments typical of defamation and interdict matters. The court had to determine, on the motion papers and applying the motion-proceedings approach, what version of disputed facts should be accepted, whether the meaning conveyed by the impugned words to the reasonable reader was defamatory, and whether the legal requirements for a final interdict were satisfied.

In addition, the court was required to decide preliminary and threshold matters raised in opposition, including whether there was a justiciable dispute involving the third applicant, whether the relief sought was moot because the articles had been removed pursuant to the interim order, and whether the applicants had an adequate alternative remedy (including a remedy under section 36B(6)(d) of the Criminal Procedure Act 51 of 1977, as raised in argument).

4. Court’s Reasoning

The court approached the matter as one for final relief on motion and stated that it was required to consider the papers “in totality” and apply the approach in motion proceedings described in Agribee Beef Fund and Another v Makinana (Case Number 867/2020 ECP, Grahamstown). In essence, the court accepted those facts advanced by the applicants that were not disputed, and the respondents’ version insofar as it was plausible, tenable, and credible.

Justiciability in relation to the third applicant

The court accepted the first respondent’s contention that there was no justiciable dispute regarding the third applicant. The court’s reasoning was that neither the Hawks media statement nor the two online articles referred to the third applicant by name. His name appeared on the charge sheet, but he did not depose to an affidavit. On this basis, the application (insofar as it concerned him) could not succeed, and the court indicated that the remainder of its analysis primarily concerned the second applicant.

Defamation inquiry and meaning to the reasonable reader

In assessing whether the impugned publications were defamatory, the court applied the two-stage inquiry highlighted in Economic Freedom Fighters and Others v Manuel 2021 (3) SA 425 (SCA). The court first considered the meaning of the words used, and then whether that meaning was defamatory in the sense of being likely to injure the esteem in which the person is held by the reasonable or average reader. The judgment referred to the formulation of the reasonable reader test in Channing v South African Financial Gazette Ltd and Others 1966 (3) SA 470 (W), emphasising that the ordinary reader is a reasonable person of average education and intelligence who is neither suspicious nor super-critical and reads newspaper articles in the usual way.

Applying that approach, the court considered it significant that the articles were widely read on the first respondent’s media platforms, and that the second and third applicants’ court appearance was a matter of fact. Although the amount appearing in the charge sheet annexures was R817,892.82, the media reports referred to R14 million.

The court reasoned that, read in context, the articles stated that the second applicant was facing allegations and did not suggest that he had already been found guilty or convicted. On that footing, the court concluded there was “nothing defamatory nor unlawful” in the first respondent’s conduct, even if the second applicant was unhappy about the publication. The court expressly linked this conclusion to the constitutional importance of robust media reporting in public discourse, reflecting the respondents’ reliance on the role of the press as discussed in authorities such as National Media Ltd v Bogoshi [1998] 4 All SA 347 (A) and Economic Freedom Fighters and Others v Manuel 2021 (3) SA 425 (SCA).

The terms “fraud” / “theft” and contextual reading

The court addressed the applicants’ objection to the use of terms such as “fraud” (and its relation to “theft”) by explaining that both denote wrongful conduct associated with dishonesty and may operate as competitive verdicts in criminal law. The court’s analysis was that using one term rather than the other did not, in itself, establish unlawfulness or defamation in the context of reporting on pending allegations. The court observed that the statutory offence for which the second and third applicants were summoned might ultimately be characterised in one way or the other.

The R14 million allegation and substantial truth

The court treated the R14 million figure as an allegation that required contextual evaluation rather than isolation. It emphasised that the article presented the amount as an allegation rather than a proven fact. The court further accepted that the second respondent’s papers supported the figure by reference to evidence from pension fund administrators and the investigating officer, and that the figure was said to comprise unpaid amounts and penalties. The applicants, on the court’s account, did not engage with these allegations in their papers in a manner that displaced the respondents’ version.

Applying the motion-proceedings approach, the court found the respondents’ version regarding the R14 million allegation not to be far-fetched, implausible, or untenable. It therefore concluded that the applicants’ complaint lacked merit on the papers before it.

Final interdict requirements, alternative remedy, apprehension of harm, and overbreadth

The court reiterated that a party seeking a final interdict must establish a clear right, an injury actually committed or reasonably apprehended, and the absence of similar protection by another ordinary remedy. It characterised a clear right as a matter of substantive law.

Although the applicants had asserted in their papers that there was no alternative remedy, the court noted that in argument they contended the respondents’ conduct contravened section 36B(6)(d) of the Criminal Procedure Act 51 of 1977. The court treated this as confirmation that an alternative remedy existed and held that it qualified as an adequate, ordinary, and reasonable remedy capable of affording similar protection in the circumstances.

On the issue of harm, the applicants contended that their business prospects, including tender eligibility, would be jeopardised. The court was not persuaded that this amounted to a well-founded apprehension of irreparable harm, particularly in light of the contention (advanced for the second respondent) that tenders are evaluated under procurement laws and that the applicants were still facing allegations only. The court also regarded the request to interdict future conduct as far-reaching and held that no sufficient reasons were advanced to justify such an order, including no basis to conclude the respondents were likely to publish further defamatory material.

Mootness

The court accepted the second respondent’s submission that the matter had become moot. It reasoned that, because the articles had been removed from all media platforms pursuant to the interim order of 17 May 2022, a further order as framed in the notice of motion would have no practical effect on the parties or others. On this reasoning, the court found there was no existing live controversy requiring final interdictory relief.

5. Outcome and Relief

The court dismissed the application for confirmation of the rule nisi and for a final interdict. It ordered the applicants to pay the costs of both respondents, jointly and severally, with the usual provision that payment by one would absolve the other.

Cases Cited

Economic Freedom Fighters and Others v Manuel 2021 (3) SA 425 (SCA).

National Media Ltd v Bogoshi [1998] 4 All SA 347 (A).

Herbal Zone v Inftech Technologies 2017 2 All SA 347 (SCA).

Channing v South African Financial Gazette Ltd and Others 1966 (3) SA 470 (W).

Agribee Beef Fund and Another v Makinana (Case Number 867/2020 ECP, Grahamstown).

Legislation Cited

Pensions Act 24 of 1956 (referred to in the judgment in connection with pension contribution contraventions; also described as the Pension Fund Act 24 of 1956).

Criminal Procedure Act 51 of 1977, section 36B(6)(d).

Rules of Court Cited

No specific rules of court were cited in the judgment.

Held

The court held that no justiciable dispute was established in respect of the third applicant, because the impugned media statement and articles did not refer to him and he did not place a case before the court on affidavit.

On the merits concerning the second applicant (and the first applicant), the court held that the publications, read as a whole and through the lens of the reasonable reader, conveyed that the second applicant faced allegations and did not state or imply proven guilt or conviction. The court held that, on the motion papers and applying the approach to factual disputes, the respondents’ version that the R14 million figure was an allegation supported by information from the pension administrators (including penalties) could not be rejected as implausible.

The court further held that the applicants failed to satisfy the requirements for a final interdict, including because an alternative remedy was available and because a well-grounded apprehension of irreparable harm and justification for wide forward-looking restraints were not established. The court also held that, as the articles had already been removed pursuant to the interim order, the relief sought was moot and would have no practical effect.

LEGAL PRINCIPLES

In motion proceedings where final relief is sought, the court must assess the papers in their totality and resolve factual disputes by accepting the applicant’s undisputed facts together with the respondent’s version insofar as it is plausible, tenable, and credible, as described in Agribee Beef Fund and Another v Makinana (Case Number 867/2020 ECP, Grahamstown).

The defamation inquiry requires establishing the meaning of the words in context and then determining whether that meaning is defamatory as understood by the reasonable or ordinary reader, applying the approach confirmed in Economic Freedom Fighters and Others v Manuel 2021 (3) SA 425 (SCA) and the reasonable reader formulation in Channing v South African Financial Gazette Ltd and Others 1966 (3) SA 470 (W).

A party seeking a final interdict must establish a clear right, an injury actually committed or reasonably apprehended, and the absence of an adequate alternative remedy. Where an alternative remedy exists that can afford similar protection, final interdictory relief is not justified on that requirement.

When considering interdicts that restrain future publication or speech, courts must approach such relief with caution because of its impact on expressive freedom, consistent with the approach reflected in Herbal Zone v Inftech Technologies 2017 2 All SA 347 (SCA) as relied upon in argument and addressed in the judgment.

Where the complained-of material has been removed and the court’s order would have no practical effect, the dispute may be treated as moot, and final relief may be refused on that basis.

Defensor Electronic Security Systems (PTY) Ltd and Others v Africa Community Media (PTY) Ltd and Another (2219/2022) [2022] ZAFSHC 233 (20 September 2022)