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[2019] ZAGPPHC 4
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Zalisa and Others v South African Social Security Agency and Others (82073/2018) [2019] ZAGPPHC 4 (29 January 2019)
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
Case
Number: 82073/2018
In the matter
between:
NOHDUMISO
ZALISA
1
ST
APPLICANT
THABO
JOSEPH
SKHOSANA
2
ND
APPLICANT
MATEBOHO
WINNIE
PENN
3
RD
APPLICANT
BONAKELE
PETRUS MAXONGO
4
TH
APPLICANT
GLADNESS
ZODWA
CELE
5
TH
APPLICANT
DWANA
NDIMENDE
6
TH
APPLICANT
MKHUJULWA
ERRICK
ZUMA
7
TH
APPLICANT
NTOMBISODWA
HAPINESS MNGANGA
8
TH
APPLICANT
KEABETSWE
TILLY
RATSATSI
9
TH
APPLICANT
PERTUNIA
MOKGADI
HAMESE
10
TH
APPLICANT
PETER
ESSAU NTETEDI
MABATLE
11
TH
APPLICANT
MAMISOLO
MARTHA
NKABI
12
TH
APPLICANT
GLADYS
SYLVIA
BUTHELEZI
13
TH
APPLICANT
MBALENHLE
ROSE
JIYANE
14
TH
APPLICANT
MONEYLINE
FINANCIAL SERVICES (PTY) LTD
15
TH
APPLICANT
AND
SOUTH
AFRICAN SOCIAL SECURITY AGENCY
1
ST
RESPONDENT
ACTING
CHIEF EXECUTIVE OFFICER OF THE
SOUTH
AFRICAN SOCIAL SECURITY AGENCY
2
ND
RESPONDENT
MINISTER
OF SOCIAL DEVELOPMENT
3
RD
RESPONDENT
SOUTH
AFRICAN POST OFFICE SOC LIMITED
4
TH
RESPONDENT
GRINDROD
BANK LIMITED
5
TH
RESPONDENT
JUDGMENT
Fabricius
J,
[1] On 28
November 2018, I heard an urgent application in which the Applicants
sought an order in the following
terms:
1.
“
Directing that this
application is to be heard on an expedited basis in terms of the
provisions of rule 6 (12) (a) of the Uniform
Rules of Court;
2.
Declaring that in providing
biometric consents in respect of their EasyPay Everywhere (“EPE”)
accounts held with the
fifth respondent, to the first respondent (via
its agent Cash Paymaster Services (Pty) Limited (“CPS”)),
social grant
beneficiaries have satisfied the requirements of
regulation 21 (1) of the Regulations Relating to the Application for
and Payment
of Social Assistance and the Requirements or Conditions
in respect of Eligibility for Social Assistance (“the Social
Assistance
Regulations”);
3.
Interdicting the first
respondent from stopping to pay any social grant into an EPE account
in respect of which biometric consent
was provided by the relevant
beneficiary to CPS prior to 1 January 2018;
4.
Directing the first respondent
to process all Annexure C forms duly completed and submitted by
social grant beneficiaries in respect
of their EPE accounts held with
the fifth respondent, within two weeks of the date of submission;
5.
Directing the first respondent
to pay social grants into bank accounts identified by beneficiaries
in their duly completed and submitted
Annexure C forms;
6.
Directing that the costs of
this application are to be paid by the first and second respondents,
alternatively jointly and severally
by the first and second
respondents, and any other respondents opposing it.”
[2] After
hearing arguments for the whole day, I issued an interim order, which
was substantially in line
with what was put to me by the Respondents,
either during argument, or with references to undertakings which had
been given by
the Respondents in writing, before these proceedings
commenced, and at a stage when the parties hereto corresponded on the
relevant
topics. Mr M. Mphaga SC on behalf of the First Respondent,
at one stage late during the argument, conceded that this order could
follow, taking into account the day’s proceedings, but after an
adjournment informed me that his instructions “had
been
withdrawn”, and that he would oppose the granting of this, or
any other order. In this particular context, I deem it
appropriate to
refer the parties to the following: in
Hlobo v Multi-Lateral
Motor Vehicle Accident Fund
2001 (2) SA 59
SCA
, Plewman JA
said the following at 65 par. [10]: “In this country (as in
England) the conduct of a party’s case at the
trial of an
action is in the entire control of the party’s Counsel. Counsel
has authority to compromise the action or any
matter in it unless he
has received instructions to the contrary”. In my opinion, Mr
Mphaga SC was quite entitled, and in
fact obliged, to put to me that
the envisaged interim draft order, which had been debated by all
parties in the Court during the
proceedings, could appropriately be
made having regard to the mentioned considerations. I do not believe
that it was proper for
the persons present in Court on behalf of the
First Respondent to have “withdrawn his instructions”, at
that stage.
Be that as it may, that topic can rest there with this
gentle reminder.
[3] The order
that I made at the end of the proceedings, is the following:
“
COURT
ORDER
Having heard counsel and having read
the papers, it is ordered that:
The
first respondent is directed to process all Annexure C forms for the
tenth to fourteenth applicants in respect of their EPE
accounts by 1
December 2018;
The
first respondent is directed to process all Annexure C forms duly
completed and submitted by social grant beneficiaries in
respect of
their EPE accounts within two weeks of the date of submission, as
and when such forms are submitted to SASSA by duly
qualifying social
grant recipients;
The
first respondent is directed to pay the social grants into the bank
accounts identified by beneficiaries in their duly completed
and
submitted Annexure C forms;
Pending
the handing down of the judgment before 31 January 2019 in this
matter the first respondent shall pay the social grants
of EPE
account holders who provided biometric consent for payment of their
grants into their EPE accounts, unless otherwise authorized
in terms
of a duly completed and submitted Annexure C form; and
Costs
reserved.”
[4] The main
judgment referred to in par. 4 of that order, now follows.
Applicants’ argument
:
[5] Applicants
argument was conveniently summarized in written Heads of Argument
which, for practical reasons
I rely on when formulating what was put
before me on behalf of the Applicants.
Urgency
:
[6] It was
submitted that to appreciate why this application was urgent, it was
necessary to consider the
three categories of individual Applicants,
and then also the position of the Fifteenth Applicant, a juristic
person. The irremediable
harm immediately faced by each category of
individual Applicant, was given greater force, because they were far
alone in their
predicament. It was said that the number of people
facing the harm which the individual Applicants faced, was some two
million
beneficiaries.
[7] The first
category of Applicants includes those who made the choice, or
election, to have their social
grants paid into private bank accounts
before the change to the Regulations in issue took place on 6 May
2016.
The
second category of Applicant includes those who elected to have their
social grants paid into private bank accounts in the period
after 6
May 2016, and up to 1 January 2018. During this period, the South
African Social Security Agency (“SASSA”),
the First
Respondent, had authorized Cash Paymaster Services (Pty) Ltd (“CPS”)
to accept, on SASSA’s behalf,
the instruction that their social
grants be paid into their chosen private bank accounts.
The
third category includes those who, after 1 January 2018, elected to
have their grants paid into private bank accounts, and conveyed
their
election to SASSA by means of forms which SASSA had determined to be
used for this purpose. These are the so-called “Annexure
C”
forms. Those instructions had not been given effect to within a
reasonable time of presenting such forms. That is an important
reason
why I granted prayers 1, 2 and 3 of the said interim order.
[8] The
Fifteenth Applicant, Moneyline, is a company which manages bank cards
and has a commercial interest
in ensuring that those who have made
elections to have their social grants paid into their private bank
accounts, by which it manages
the bank cards, have their choices on
it, and do in fact have their social grant paid into those accounts.
[9] The
urgency for the first and second categories of social grant
beneficiaries, lies primarily in the
fact that if the Respondents
were not prevented from giving effect to their stated intentions to
“ought to migrate”,
the grant payments into South African
Post Office (“SAPO”) bank accounts, then:
1.
The first and second
categories of beneficiaries would not be paid their social grants
into their chosen private bank accounts in
respect of which the
Fifteenth Applicant operates the bank cards. As a result, they will –
by operation of the terms of the
agreements covering these accounts –
forfeit and lose their free funeral cover worth R2 500 each,
which loss is not
remediable in due course;
2.
The first and
second categories of beneficiaries would, if the social grants were
not paid into their chosen private bank accounts
in respect of which
the Fifteenth Applicant operates the bank cards, have to go to a
SASSA office to find out what happened to
their grant payment for the
month, and then go to a SAPO branch to draw the grant. This is
particularly evident from the affidavit
of the Eighth Applicant where
she explains in her Supplementary Affidavit the steps that she was
advised to take if she wanted
to restore payment into her chosen bank
account after she has been auto-migrated by SASSA. The inconvenience,
confusion, distress,
time wasted and transport costs –
particularly in rural areas – if transport be available when
required, would cause
the elderly, the disabled and those entrusted
with the care of young children (i.e. social grant recipients), harm
which is not
remediable in due course;
3.
Even if such harm
suffered were notionally remediable in the hands of a person who
could afford to pay lawyers to bring action claims
in due course, the
individual Applicants’ “right” to do this, is
merely illusory;
4.
The loss of some
two million grants from the accounts for which Fifteenth Applicant
manages the bank cards for a fee, will be a
devastating blow to the
Fifteenth Applicant’s business, the damage to its goodwill will
be irremediable, and it would be
unable to obtain substantive redress
in the ordinary course, not least because recovery of damages in
these circumstances against
public authorities would be costly,
difficult to prove and difficult to sustain a cause of action on;
5.
The Respondents
have indicated in no uncertain terms that they intend to make payment
of the social grants in issue into the SAPO
bank accounts, not into
the private bank accounts which the first and second categories of
grant beneficiaries have chosen, and
have in fact been using to
receive the social grants paid for the past number of years. The crux
therefore was that the Applicants
simply wanted the status quo to be
maintained;
6.
The Respondents repeated
assurance that “the Applicants will be paid”, was simply
not true in respect of the Fifteenth
Applicant, and not practically
true in respect of all three categories of individual Applicants. It
is true that there would be
standing to the credit of the individual
Applicants’ money in accounts that they did not choose, and do
not normally use
and were not aware of. It was submitted in this
context that the Applicants were not required to go on a treasure
hunt through
the forests of State machinery, and State-owned
enterprises, to find where the payment has been hidden. They are
entitled to have
their prior choices respected, and the way in which
they receive their social grants uninterrupted;
7.
The submission
furthermore was that if there were going to be changes made by the
State, the social grant recipients were entitled
to be given notice
of the impending change, and a fair opportunity to elect to continue
with their existing accounts as managed
by the Fifteenth Applicant.
Instead they were being “auto-migrated”, but there was
nothing “automatic”
about this migration. It was the
product of a deliberate decision-making process on the part of the
Respondents;
8.
The Respondents have
imposed, in violation of the Rule of Law, as it was put, that as of
31 January 2019, all valid and authorized
prior elections as to the
destination of social grants would be erased, and a new order would
be imposed. The exception provided
by the “Annexure C”
method of recognizing the social grant recipients’ elections
was, in the light of the experience
of the third category of
Applicants, as illusory as any right to recover damages in due
course;
9.
The Respondents’
protestations that commercial urgency did not merit urgent
adjudication, was erroneous in law, and in any
event really only
applied to the Fifteenth Applicant. For the other Applicants and
their dependants, and others in the same position,
the situation was
far closer to body and soul, life and death, inasmuch as social
grants were not “commercial”;
10.
The commercial interests
of the Fifteenth Applicant corresponded with the life-interests and
dignity-interests of the other Applicants.
The fact that the
Fifteenth Applicant brought this application to Court, has opened a
door to justice that the other Applicants
would probably never have
been able to open themselves;
11.
In the context of the Court’s
power to grant and interim interdict on an urgent basis, it was held
in
Tony Rahme Marketing
Agencies SA (Pty) Ltd and Another v Greater Johannesburg Transitional
Metropolitan Council
1997 (4) SA 213
(W)
,
per Goldstein J, that in appropriate cases “mere”
commercial interests could indeed justify the grant of an urgent
order. I agree with that finding.
12.
It was also submitted
that the failure of Respondents to timeously process the third
category of Applicants’ applications
(Annexure C forms) and to
have the social grants paid into the private bank accounts was
unreasonable, and there was no justification
for such delay;
13.
The delay prejudices
those Applicants – not least because they are unable to get the
free funeral cover as soon as is reasonably
possible – but they
are deprived of the other benefits of a private bank account as well.
In the case of the Fifteenth Applicant’s
bank card managed
accounts, these include the convenience of thousands of pay-points
around the country including many other service
areas where SAPO
branches are far distant, have limited trading hours, and where long
queues can predictably be expected; (if affordable
transport is
available in any event)
14.
The object of the entire social
grant policy has included, as a number of Constitutional Court
judgments have demonstrated, to “bank
their previously
unbanked”. This was part of the overall poverty alleviation
policy. The actions of the Respondents ran counter
to this policy and
they were “un-banking the banked”, and auto-migrating
them into second rate SAPO accounts, riding
rough-shot over their
express wishes to have private bank accounts.
[10] It was furthermore submitted by
Mr Morrison SC that in opposing the relief sought in this
application, the Respondents probably
overlooked the following
relevant facts:
1.
As EasyPay Everywhere (“EPE”)
accountholders, each of the 14 individual Applicants would have
received R2 500 free
funeral cover upon being issued with an EPE
card. This benefit will not be payable if the card was not active for
a period of longer
than three months at the time of their
beneficiary’s death;
2.
Moneyline offers +/- 300 mobile
branches that visit approximately 6500 pay points, where
beneficiaries can transact and withdraw
money. These are situated in
some of the most rural parts of South Africa, and importantly, they
are not SASSA pay points;
3.
SASSA has resolved to
discontinuing servicing over 9000 pay points, leaving beneficiaries
to their own devices to travel to the
nearest SAPO office or fixed
banking infrastructure at their own cost;
4.
Certain of the Applicants,
along with other beneficiaries, have completed Annexure C forms that
SASSA either refuses to accept,
or has failed and/or refuses to
process;
5.
The next cycle for the payment
of social grants commences on 1 December 2018.
All of the abovementioned were major
considerations when I granted my interim order on 28 November 2018.
[11] Insofar as the
cessation of payments into EPE accounts from the end of January 2019
is concerned, the first
immediate consequence would be that the
Applicants (and other EPE cardholders), will lose their funeral
cover. For example, the
Second Applicant expressly stated that he was
a pensioner and that absent the funeral cover, his four dependants
would not be able
to afford to bury him.
[12] There was also
a real possibility that SASSA’s requirements for beneficiaries
with private bank accounts,
to submit Annexure C forms by 31 January
2019, may not come to the attention of all such beneficiaries,
inasmuch as many of them
lived in the most remote rural areas of the
country, and were often old, frail and disabled. Whilst SASSA did
provide house visits,
outreach, sms’s and telephone calls, as
means of communication, it had provided no concrete plans to ensure
that the affected
social grant beneficiaries would in fact be
contacted, and that their lives would not be disrupted. In fact,
SASSA requested assistance
from Moneyline to contact these
beneficiaries and have them return the completed Annexure C forms.
[13] A further
important consideration was that the deadline of 31 January 2019, had
been self-imposed by SASSA.
It was contended that it had provided no
basis to explain this apparent urgent need for this process to be
completed in such a
short time.
[14] Taking into
account the abovementioned considerations, as well as the decision of
Goldstone J in
Twentieth Century Fox Film Corporation and
Another v Anthony Black Films (Pty) Ltd
1982 (3) SA 582
(W) at 586G –
H
, wherein he held that the urgency of commercial interests
could justify the invocation of
Uniform Rule of Court 6 (12)
,
no less than any other interests, depending in each case on its own
particular circumstances, I held that the case before me was
indeed
urgent, and accordingly I issued the interim order, which in turn was
justified on the facts.
The issues
:
[15] It was
contended that essential to this application are the procedures in
terms of which millions of beneficiaries
from April 2012 until
December 2017, made their election to receive payment of social
grants in the bank accounts of their choice.
According to SASSA and
the Minister, these procedures did not comply with
Regulation
21 (1) (a)
as amended. In their view, such beneficiaries must
still comply by 31 January 2019, failing which their social grants
would be
paid into SAPO accounts opened on their behalf.
[16] From 22 August 2008
to 5 May 2016,
Regulation 21 (1)
, provided that social
grants would be paid in two ways, either by way of –
1.
“
Electronic transfer into
an account of the beneficiary or institution where the beneficiary
resides, subject to written authorization
by the beneficiary”;
or
2.
“
Manual payments at a
designated place”.
Since 6 May 2016, Regulation 21 (1)
has provided that payment of social grants may be effected in the
following ways:
“
The agency shall pay a social
grant –
a)
Into a bank account of the
beneficiary or institution where the beneficiary resides, provided
that:
i)
The beneficiary of the social
grant consents to payment in accordance with sub-Regulation 21 (1)
(a) in writing and has submitted
such consent in person to the
agency;
ii)
Where a beneficiary is unable
to submit the consent
contemplated in sub-paragraph i) in
person, alternative arrangements must be made with the agency; or,
b)
By the payment method
determined by the agency”.
In contrast to the views of SASSA and
the Minister, Mr Morrison SC submitted that beneficiaries were not
required, for a second
time, to provide authorization for the payment
of social grants into their chosen bank accounts. This submission was
made for two
reasons: first the procedures in terms of which these
beneficiaries made their election to receive payment of the social
grants
where expressly authorized and accepted by SASSA, following
which payments were made over many months and/or years, and, unless,
and until SASSA reviews and sets aside its own decision, an issue
which was not before me, SASSA could not require beneficiaries
to
provide consent for a second time. Second, in providing consent in
the manner that they did, beneficiaries satisfied the requirements
of
Regulation 21 (1) as it read at the relevant time.
[17] Applicants also
contended that this case also deals with SASSA’s ability to
process a duly completed
and submitted Annexure C forms, and whether
this ought to be done within a reasonable period. The Minister
submitted that there
are currently no back-logs in the processing of
the forms, and no delays in the subsequent capturing of all relevant
data on SASSA’s
system to enable payment, but she has provided
no information regarding the time it takes for this to happen. One
was not told
whether this would take days, weeks or even months, and
SASSA was silent on this issue.
[18] As already
mentioned, SASSA requested assistance from Moneyline to contact the
beneficiaries and to have
them return completed Annexure C forms.
SASSA, as is apparent therefore, does not have the capacity to
contact all beneficiaries
itself.
[19] At its core
therefore, this case was about SASSA’s intention – with
the Minister’s express approval
– to take the law into
their own hands. Yet, our law frowns upon those who do so.
See:
Chief Lesapo v North West
Agricultural Bank and Another
[1999] ZACC 16
;
2000 (1) SA 409
(CC) par. 1
,
and,
Ekhuruleni
Metropolitan Municipality and Another v Various Occupiers, Eden Park
Extension 5
2014 (3) SA 23
(SCA) at par. 23
,
wherein it was held that “the resort to self-help, breeding as
it does chaos and anarchy, is the very antithesis of the
Rule of
Law”.
[20]
ESSENTIAL FACTS
20.1
From
1 April 2012 to 31 March 2018, CPS administered payments to all
social grant beneficiaries, pursuant to a tender awarded by
SASSA.
While
the
award of the tender was declared invalid on 29 September 2013, the
declaration of invalidity was suspended for the duration
of the
awarded contract.
20.2
The
“
administer[ing
of] social assistance in terms
of
Chapter 3 of the Social Assistance Act, [13 of] 2004”
is a
function allocated to SASSA by section 4(1)(a)
of the South African Social Security Agency Act 9 of 2004 (“the
SASSA Act”). However, SASSA is entitled to “
enter
into an agreement with any person to ensure effective payments to
beneficiaries”
.
20.3
For
most of the six years, a beneficiary could receive payment of a
social grant in two ways: either by way of an electronic funds
transfer (“EFT”) directly into his or her chosen bank
account; or in cash, at a designated pay point. As SASSA’s
agent, CPS was responsible for capturing beneficiaries’
choices, and paying in the chosen manner
20.4
On
6 May 2016, the Social Assistance Regulations were amended to change,
amongst other things, the manner in which social grants
were to be
paid. While the option to be paid by EFT directly into one’s
chosen bank account remained, the cash payment option
was replaced by
“
the
payment method determined by [SASSA].”
20.5
It
would take another two years for
SASSA
officially to determine this payment method – by EFT into a
special bank account, with limited functionality, held at
SAPO. Until
then, and even for a few months thereafter, beneficiaries were able
to continue receiving payment of their social grants
in cash, at
designated pay points.
20.6
By
31 December 2017, CPS had stopped capturing beneficiaries’
authorizations to be paid into their chosen bank accounts. This
function was taken over by SASSA, in accordance with the former
acting CEO’s letter of 29 November 2017 in which she stated
that “
[t]he
previous authority given by SASSA to enable beneficiaries to approach
CPS directly to request a transfer into a bank account
of their
choice is hereby withdrawn.”
20.7
Once
SASSA took over this function of capturing authorisations from
beneficiaries to have their social grants paid into private
bank
accounts, SASSA insisted, in order for a beneficiary’s election
to be paid into a private bank account to be effective,
on the
submission, by the beneficiary, in person, of a duly completed
Annexure C form. This insistence was premised on a
particular
interpretation of regulation 21, an interpretation which was
erroneous in that it failed to take into account the principles
of
interpretation, in particular purposive interpretation, as per Mr.
Morrison’s submission.
20.8
In
relevant part,
section 5(2)(e)
of the
Social Assistance Act 13 of
2004
provides that “
[t]he
Minister may prescribe additional requirements … in respect of
… forms, procedures and processes for …
payments”
.
The Annexure C form has never been prescribed; it does not appear in
any
Government
Gazette
,
and appears to be nothing more than a bureaucratic invention of
convenience.
[21] I was referred
to the decisions
of Oudekraal Estates (Pty) Ltd v City of Cape
Town and Others
2004 (6) SA 222
(SCA) at par. 26
, and
MEC
for Health, Eatern Cape and Another v Kirland Investments (Pty) Ltd
T/A Eye and Laser Institute
2014 (3) SA 481
(CC) at par. 26
.
With reference to the relevant
dicta
, it was submitted that it
would follow that if SASSA was of the view that the procedures in
terms of which certain beneficiaries
made their election to receive
payment of the social grants in the bank accounts of their choice was
unlawful, then it would have
to make an application to this Court to
review its own decision in terms of which such elections were made.
They could not resort
to self-help in this context, and it also did
not matter whether they were acting in good faith or whether there
was a good cause
for their conduct. It was submitted that this
approach was also in line with the Constitutional Court’s
decision in
State Information Technology Agency SOC Ltd v
Gijima Holdings (Pty) Ltd
2018 (2) SA 23
(CC)
.
Previous consent
:
[22] Prior to their shift
of Annexure C forms as required by SASSA, there were two ways in
which beneficiaries could
authorize CPS to pay social grants into
their chosen bank accounts:
Either
directly by contacting the CPS call centre to provide authorization
for the grant to be paid into an existing bank account;
or
Indirectly,
by providing biometric consent to Moneyline when opening an EPE
account, evidence of which would then be provided
to, and captured
by CPS.
[23] In either case, once
CPS had received a beneficiary’s authorization for his or her
social grant to be paid
into the bank account of his or her choice,
it would then ensure that such payments were made by EFT. Regardless
of the method
of authorization, payment in this manner continued
until the end of 2017. Starting in January 2018, payment directly
into beneficiaries’
chosen bank accounts was made by SASSA.
Such payments continued to be made.
[24] Whether the
authorizations provided comply with
Regulation 21
(1)
depends, in part, on which version of the
Regulation
is
to be considered. On behalf of Applicants it was submitted in line
with
Curtis v Johannesburg Municipality
1906 TS 308
,
that the amendment of
Regulation 21
(1)
on 6 May 2016,
did not render beneficiaries previous authorization in terms of the
un-amended provision invalid. Reference was
made to the
dictum
of Innes CJ at 311, where he said the following: “The general
rule is that, in the absence of express provision to the contrary,
statutes should be considered as affecting future matters only; and
more especially that should if possible be so interpreted as
not to
take away rights actually vested at the time of their promulgation”.
To that I may add that the whole topic of retrospectivity
of statutes
was dealt with in great detail in
Pienaar Brothers (Pty) Ltd v
Commissioner for the South African Revenue Services and Another
[2017] 4 ALLSA 175
GP (also
2017 (6) SA 435
GP)
. Also, this
general rule has been approved and applied by the Constitutional
Court in
Veldman v Director of Public Prosecutions,
Witwatersrand Local Division
2007 (3) SA 210
(CC) at par. 27
.
Also,
in
Werkman’s
Compensation Commisioner v Jooste
[1997] ZASCA 58
;
1997 (4) SA 418
(SCA) at 424 F to
H
, Smalberger JA said
the following: “There is at common law a prima facie rule of
construction that a statute (or any amendment
or legislatively
authorized alteration thereto) should not be interpreted as having
retrospective effect. … The presumption
against
retrospectivity arising from this rule may be rebutted, either
expressly or by necessary implication, by provisions or
indications
to the contrary in the enactment under consideration. …”
[25] It was therefore
submitted that insofar as
Regulation 21
(1)
was
concerned, there was nothing in the amended text to suggest that the
presumption against retrospectivity should be rebutted.
On the
contrary, the text made it clear that retrospectivity was never
intended. If it were, this would mean that hundreds of millions
of
cash payments would have been made unlawfully prior to 6 May 2016.
Accordingly,
compliance with
Regulation
21
(1)
must be assessed
according to the requirements of the provision as it read at the
relevant time. Despite this, both SASSA and the
Minister treat all
consents given prior 2018 the same, regardless of when it was given,
and regardless of the process in terms
of which it was given. In
their view, this is so, because what was not provided directly to
SASSA in the form of a duly completed
Annexure C.
Interpretation
:
[26] I was referred to
Natal Joint Municipal Fund v Endumeni Municipality
2012 (4) SA
593
(SCA)
, and
Novartis SA (Pty) Ltd v Maphil Trading
(Pty) Ltd
2016 (1) SA 518
SCA.
In the latter case, it was
held that the Court must in each relevant particular context consider
all the circumstances surrounding
the conclusion of a contract to
determine what the parties’ intention was in concluding it, and
all relevant facts must be
considered in that exercise, whether or
not the words particular contract were ambiguous or lacked clarity.
It
was therefore submitted that seemingly mindful of these decisions,
the Minister’s approach to amended
Regulation
21
(1)
considered the
context provided in reports prepared by a panel of experts appointed
by the Constitutional Court pursuant to directions
issued on 6 June
2017. But, as the Replying Affidavit made clear, none of the findings
and recommendations of the panel could have
influenced such amendment
of the
Regulation
which took place over a year
prior
to the panel being established.
The
relevant context to the amendment of
Regulation
21
(1)
in May 2016 is
set out in the recent decision dealing with the 6 May 2016 amendments
to two provisions in the
Social
Assistance Regulations
.
See:
The Minister of Social
Development of the Republic of South Africa and Others v Net 1
Applied Technologies South Africa (Pty) Ltd
and Others
;
The Black Sash Trust and
Others v The CEO: The South African Social Security Agency and Others
[2018] ZASCA 129
, a decision of 27 September 2018
.
After setting out the background to
the decision to amend the
Regulations
, Navsa JA,
considered how the Minister in Office at the time, sought to amend
the Regulations and what she intended to achieve.
What was clear from
Navsa JA’s description of the process was that the focus of the
intervention was to deal with certain
deductions from beneficiaries’
bank accounts. It was therefore telling that the then Minister was of
the view that she had
achieved her goal and this resulted in her
issuing a demand to Grindrod, the bank to “cease all EFT debit
orders and stop
orders” from beneficiaries’ accounts. Put
differently, the Minister’s focus was not on the procedure in
terms
of which beneficiaries consented to having their social grants
paid into their chosen bank accounts, but rather with regulating
the
manner in which those bank accounts were operated. Whilst this could
not be determinative, it did provide part of the context
to which
both of the
Endumeni
and
Novarti
s
decisions
supra
refer, and which should be taken into account
when interpreting
Regulation 21 (1)
.
[27] It was also submitted
that two further considerations needed to be considered. First, the
possible impact of any
interpretation of
Regulation 21 (1)
on the private contractual relationship between social grant
beneficiaries on the one hand, as bank account holders, and the banks
with whom they hold such accounts on the other; and second, whether
SASSA has any authority to interfere in this private contractual
relationship. It was held
Barkhuizen v Napier
[2007] ZACC 5
;
2007 (5) SA 323
(CC) at par. 57
that self-autonomy, or the ability to
regulate one’s own affairs, even to one’s own detriment,
is the very essence
of freedom and a vital part of dignity.
The
submission therefore was that stripped bare, the attitude adopted by
SASSA and the Minister, was that because beneficiaries
did not
consent to receive payments of social grants in their chosen bank
accounts in terms of an amended
Regulation
21 (1)
, they have not
provided the requisite consent at all.
Insofar
as SASSA’s purported authority to interfere with private
contractual relationships is concerned, I was referred to
the Full
Court of this Division in
Minister
of Finance v Oakbay (Pty) Ltd
on the basis that such interference would have to be empowered either
by statute or the
Constitution
.
(2018 (2) SA 515
GP).
Accordingly, it was submitted that
there is no legislative provision, including Regulation 21 (1), that
authorizes SASSA to interfere
with the private contractual
relationship between a social grant beneficiary and his/her chosen
bank. Should SASSA take its threatened
action, it would run the risk
of interfering with tens – if not hundreds – of thousands
of such relationships.
Requirements
of Regulation 21 (1):
[28] Until 5 May 2016,
there was no requirement that authorization be provided to SASSA; all
that was required was that
it be provided in writing. Whilst
Applicants accept that authorization by way of the CPS call centre
was not done in writing, it
was submitted that all authorizations
provided biometrically during their EPE enrolment process were done
in writing. This flowed
from the provisions of
s. 12
of the
Electronic Communications and Transactions Act 25 of 2002
,
and if read together with the definitions in
s. 1
, made it clear that
authorizations in respect of all EPE accounts opened until 5 May
2016, where provided in writing. Insofar as
the amended
Regulation
21
(1)
was concerned, Applicants accepted that although the
“in writing” requirement was met by all beneficiaries as
part
of the EPE enrolment process, their authorizations were provided
to Moneyline and not “in person” to SASSA or CPS acting
as SASSA’s agent. However, given that such authorizations were
accepted as valid by SASSA, resulting in social grant payments
to EPE
accounts, it followed that such authorizations were provided in terms
of an “alternative arrangement” with SASSA.
Applicants are entitled to final
interdictory relief
:
[29] As was apparent from
paragraphs 3 and 4 of the Notice of Motion, a prohibitory interdict
and a mandatory interdict
respectively was sought. In order to be
successful with a final interdict, Applicants were required to
satisfy the following requirements:
The
existence of a clear right;
An
injury actually committed or reasonably apprehended; and
The
absence of similar protection by any other ordinary remedy.
See:
Setlogelo v Setlogelo
1914
AD 221
and 227, and National Treasury and Others v Opposition to
Urban Tolling Alliance and Others
2012 (6) SA 223
(C) at paras. 44
and 45
.
Clear
right
:
[30] In order to establish
a clear right, the Applicants have to prove on balance of
probabilities – facts which
in terms of the substantive law
establish the right relied on.
Nienaber
v Stuckey
1946 AD 104
at p. 1053 to 1054
.
It
was contended that it had been shown that each of the 14 individual
Applicants had a right to elect how to receive payment of
his or her
social grant and has provided valid authorisation for that election
to be honoured by SASSA. Insofar as Moneyline was
concerned, it was
shown that SASSA was not authorized to interfere with the contractual
relationship between EPE account holders
and Grindrod, on which
Moneyline relies for managing the EPE card program. As far as the
injury apprehended was concerned, the
test is objective with the
Applicants not being required to establish that any anticipated
injury would follow.
See:
Free State Gold Areas Ltd
v Merriespruit (OFS) Goldmining Company
1961 (2) SA 505
(W) at 515 to
518
.
It
was submitted that it had been shown that should the payments not be
made into the beneficiaries’ accounts, they would
lose their
funeral cover and their lives would be severely inconvenienced and
disrupted. In addition, Moneyline would suffer irreparable
financial
harm.
[30] In conclusion it was
contended that no adequate, ordinary or reasonable legal remedy would
grant similar protection.
The
PAJA
remedy, as contended
for by SASSA, was not an alternative remedy in that at best, it
offered another mechanism for approaching
this Court for urgent
declaratory or interdictory relief. In any event, the provisions of
s. 8
of the
Promotion of Administrative Justice Act 3 of 2000
,
made provision for the grant of a temporary interdict on the one
hand, but on the other hand was also intended for past conduct,
and
not conduct that would result in the future.
[31] It was also
submitted that if the central legal issue in this case was not
resolved by 31 January 2019, the
harms anticipated in respect of the
First to Ninth Applicants and those they represented, was similarly
likely to occur. Therefore
nothing short of an urgent interdictory
relief was capable of providing the protection the Applicants
required.
[32] The above fairly
lengthy narrative in my view fairly and accurately deals with the
Applicants’ case and in
certain respects also with the reasons
for the Respondents’ opposition to the relief sought. I will
nevertheless refer briefly
to a number of particular grounds of
opposition.
First and Second Respondents’
argument
:
[33] The Respondents
opposed the application on a number of grounds, and firstly dealt
with the question of urgency.
There is at this stage no reason to
debate this in any detail, inasmuch as I issued the interim order on
the basis that the case
for urgency had indeed been made out. This
was so particularly in respect of the First to Fourteenth Applicants.
It must be remembered
that each debate about urgency has to be
contextual. We were dealing here with the payment of social benefits
to persons who are
old, vulnerable, poor and who in the main are not
properly mobile either. To them proper, timeous and reliable payment
into an
account of which they have knowledge, and which they can use
with attended benefits is obviously of more importance than the
majority
of cases who come before an Urgent Court. In many instances
their very survival is at stake. As far as the Fifteenth Applicant is
concerned, I have already referred to the argument on its behalf, and
the relevant judgments in that context.
[34] It was also argued
that the declaratory relief sought was impermissible in the light of
the clear wording of
Regulation 21
published on 6 May 2016. The
argument was that I could not grant this declaratory relief, because
the legal position has clearly
been laid down by statute. Reference
was made in this context to
Ex parte Noriskin
1962 (1) SA 856
(D)
.
[35] I have dealt at some
length with Applicants’ argument pertaining to the
interpretation of this Regulation,
and whether or not it affects
previous rights. I referred to the relevant authorities as well.
Whilst much can be said in favour
of Applicants’ argument
relating to the interpretation of the particular
Regulation
,
it must also be remembered that a Court must determine the meaning of
the provision needed to be interpreted by analysing the
purpose of
the statute and the context of the legislation. At the same time it
must look at the subject matter and the values that
underlie the
statute. I agree with Mr Mphaga’s argument that in essence the
Court must give the words their ordinary meaning,
but must give a
contextual and purposive reading of the legislation. This is clear
from the
Natal Joint Municipal Pension Fund
decision
supra
at par. 18. It must also be remembered that s. 3 of the
South African Security Agency Act No. 9 of 2004
(“the
SASSA Act
”) makes provision for the effective
management, administration and payment of social assistance and
service, as mandated
by s. 27 of the
Constitution
. In
this context reference was also made to
Commissioner for the
South African Revenue Service v Bosch
2015 (2) SA 174
(SCA) at par.
9
.
It
was therefore contended that on a proper construction of
Regulation
21
(1), read with the
objective and purpose of the
SASSA
Act
and s. 27 of the
Bill of Rights
,
it was patently clear that the Minister may determine a method of
payment of social assistance. Furthermore, the Applicants did
not
contend that the Minister did not possess such a discretion. In
addition, it was clear that the First Respondent had given
its
interpretation to the Regulations by correspondence already dated 29
November 2017 and 29 October 2018, which interpretation
was
consistent with the purpose of the statute and the context of the
legislation.
[36] As far as First
Respondent’s interpretation was concerned, it is clear that it
is the administrative body
that deals with social grants as defined
in the
SASSA Act
. The letters by SASSA that I have
referred to stated that the interpretation to be attributed to
Regulation 21 (1)
was the following: “A
beneficiary can exercise a choice to have the grant paid into a
personal bank account, or to receive
a grant through the new
SASSA/SAPO card. However, it also implies, where a beneficiary does
not actively exercise his/her choice,
the SASSA/SAPO card becomes the
default method payment, to ensure that every beneficiary is able to
access his/her grant”.
[37] In the context of
what was held in
CSARS v Bosch
2015 (2) SA 174
(SCA)
,
where it was stated that there was authority to the effect that, in
the marginal question of statutory interpretation, evidence
that it
has been interpreted in a consistent way for a substantial period of
time by those responsible for the administration of
the legislation
is admissible and may be relevant to tip the balance in favour of
that interpretation, it was clear that SASSA
had been consistently
interpreting
Regulation 21 (1)
since December 2017.
An
interpretation that recognizes and adapts the contractual
interpretation, was also confirmed in the Constitutional Court in
Marshall and Others v
Commissioner South African Revenue Service
[2018] ZACC 11
.
[38] It is my view, that
in the present proceedings this is an approach that ought to be
adopted. It gives due effect
to the statutory role of the First
Respondent and its powers and obligations.
[39]
The
applicability of the Administrative Justice Act (PAJA)
:
On
4 October 2018, NET 1 addressed a letter to the Minister in which the
following was stated in par. 20: “Insofar as the
Administrative
Law is concerned, we have been advised that the decision to cease
making payments of grants into our customers’
EPE accounts
and/or redirect the payments into SAPO accounts (and unilaterally
opens such accounts for these purposes) constitutes
administrative
action for the purposes of the
Promotion
of Administrative Justice Act 2 of 2000
(“
PAJA
”)”.
It was submitted that Applicants’ were indeed aware of the fact
that a
PAJA
Review was the only remedy available for the relief that they sought.
The argument was that prayers 4 and 5 of the Notice of Motion
could
therefore only be granted if the decision of failure to take a
decision by SASSA has been found to be unlawful and reviewable.
The
ultimate question would be whether a beneficiary’s right to be
paid a grant has adversely been affected by the procedure,
the
administrator followed in requesting the Annexure C forms as per
Regulation 21 (1)
of the
Regulations
.
In that context it was submitted that a case for administrative
review has not been made out by the Applicants at all, let alone
in
these proceedings. The Applicants sought a declaratory order to the
effect that First Respondent acted in breach of his statutory
obligation by not processing Annexure C forms. It was submitted that
the alleged failure by SASSA constitutes an administrative
action as
contemplated in s. 1 of
PAJA
.
[40] It is clear from a
number of decisions including
Minister of Health and Another
N.O v New Clicks South Africa (Pty) Ltd and Others
2006 (2) SA 311
(CC)
, that a litigant cannot avoid the provisions of
PAJA
by going behind it, and seeking to rely either on s. 33 (1) of the
Constitution
or the common law or indeed the Rule of
law. In
State Information Technology Agency SOC Ltd v Gijima
Holdings (Pty) Ltd
2017 (2) SA 63
(SCA)
, it was held that
where
PAJA
applies, effect must be given to it and that
it could not be contended as an alternative that the principle of
legality could found
a cause of action. The proper place for the
principle of legality in our law is for it to act as a safety net or
measure of last
resort when the law allows no other avenues to
challenge the unlawful exercise of public power. It cannot be the
first port of
call, or an alternative path to review when
PAJA
applies.
[41] In the present
instance, the Applicants have not followed the provisions of
PAJA
,
and they cannot rely on the principle of legality in the present
context therefore. Accordingly, as a matter of logic, I cannot
grant
a final interdict if no case for illegality has been made out in
terms of the provisions of
PAJA
relating to this topic.
In the same context, I ought not to exercise my discretion in
granting the declaratory order sought in prayer
2 of the Notice of
Motion.
[42] It was contended that
the provisions of
PAJA
do not prevent a Court from
issuing an urgent order. I agree that this is so in appropriate
circumstances, and I kept that in mind
when issuing my interim order
on 28 November 2018. In the present proceedings relating to the
issuing of final orders, different
considerations apply and there is
no reason why the
Administrative Justice Act
can be
side-stepped.
[43]
Third
Respondent’s argument
:
The
crux of Third Respondent’s argument is really that Applicants
state no more than that biometric consent is sufficient
for
compliance with
Regulation
21 (1) (a)
. The aim of
this
Regulation
,
coupled with Annexure C, is more than a mere regulatory verification
of a beneficiary’s identity and contact details. It
seeks to
introduce a system over which SASSA can be assured of its internal
integrity. This is only possible if all beneficiaries
assist in
confirming their election through the in-person submission of an
Annexure C form. The completion and submission of this
form can
hardly be described as onerous as the completion of the affidavits
which the Applicants have deposed to in this matter.
The telephonic
authorisation referred to in the Founding Affidavit, and again in the
Replying Affidavit, do not constitute consent
given in person. And it
does not appear that the Fifteenth Applicant contends this form of
authorization complies with
Regulation
21 (1)
. It is clear
from the Minister’s Answering Affidavit that the system to be
put in place is one that is authorized by statute,
and no case for
illegality had been made out in my view. It must also be remembered
what the purpose of the Minister’s approach
is, namely to
prevent various abuses that have occurred in the past. In the light
of what I have said relating to the argument
on behalf of the First
Respondent, it is not necessary to further deal with any arguments
raised on behalf of the Third Respondent.
[44] It is in my view
abundantly clear that I ought not to exercise my discretion in
granting any declaratory relief
for the reasons stated. As far as a
final interdict is concerned, it is not appropriate in the present
circumstances relating to
the absence of a clear right that is
contended for on the one hand, and the interpretation that is to be
given contextually of
Regulation 21 (1)
on the other
hand. Furthermore, as I have said, the provisions of
PAJA
have
been unjustifiably sidestepped in these proceedings, and as a result
of all of the above, I exercise my undoubted discretion
against the
Applicants as a whole. I simply cannot ignore that a statutory
system, properly authorized, has been put in place for
sound reasons
as well as the undertaking given by Respondents, that grantees are
being paid and will be paid their grant. If in
any individual case,
or cases, this does not occur, appropriate steps by the First
Respondent will no doubt be taken. As far as
the Fifteenth Applicant
is concerned, it will seek to enforce its rights, such as they may
be, by proceedings other than interdictory.
It is, simply put, not
appropriate for a Court, against the clear wishes of the statutory
authority, and in the absence of illegality,
to put its own preferred
system in place of that imposed by it for rational reasons. I think
that the dictum in par. [85] in
Electronic Media Network Ltd
and Others v e.tv (Pty) Ltd and Others
2017 (9) BCLR 1108
(CC)
,
applies to this reasoning.
[45]
The application is
accordingly dismissed and the interim order of 28 November 2018
lapses from date hereof. As far costs are concerned,
the Applicants
did obtain interim relief, but the end result is in favour of the
Respondents. Accordingly, I deem it appropriate
and fair that no
costs order is made.
JUDGE
H.J FABRICIUS
JUDGE
OF THE HIGH COURT GAUTENG DIVISION, PRETORIA
Case number:
82073/2018
Counsel
for the 1
st
to 15
th
Applicants:
Adv L. J. Morrison SC
Adv J. Berger
Adv M. Chauke
Instructed by: Smit Sewgoolam
Inc.
Counsel
for the 1
st
Respondent:
Adv M. Mphaga SC
Adv P. Jara
Instructed
by: Renqe FY Inc.
Counsel
for the 3
rd
Respondent:
Adv G. M. Malindi SC
Adv S. Kazee
Instructed by: Harris Nupen Molebatsi
Inc.
Date
of Hearing: 28 November
2018
Date
of Judgment: 29 January 2019 at 10:00