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[2017] ZAGPPHC 540
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Joosub v Executive Officer of the Financial Services Board And Others (5223/2017) [2017] ZAGPPHC 540 (24 March 2017)
REPUBLIC OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE
NO:
5223/2017
NOT
REPORTABLE
NOT
OF INTEREST TO OTHER JUDGES
REVISED
SHOAYB
JOOSUB
APPLICANT
VS
EXECUTIVE
OFFICER OF THE FINANCIAL
SERVICES
BOARD -The
Registrar FIRST
RESPONDENT
LARA
DU PLESSIS: INSPECTOR OF THE
FINANCIAL
INSTITUTIONS SECOND
RESPONDENT
S
HOOSEN: INSPECTOR OF THE FINANCIAL
INSTITUTIONS
THIRD
RESPONDENT
G
VANDEVENTER: INSPECTOR OF THE FINANCIAL
INSTITUTIONS
FOURTH
RESPONDENT
J
MATHYE: INSPECTOR OF THE FINANCIAL
INSTITUTIONS FIFTH
RESPONDENT
W
NKADIMENG: INSPECTOR OF THE FINANCIAL
INSTITUTIONS SIXTH
RESPONDENT
M
MAGAVHA: INSPECTOR OF THE FINANCIAL
INSTITUTIONS SEVENTH
RESPONDENT
THE
MINISTER OF
DEFEN EIGHTH
RESPONDENT
JUDGMENT
KUBUSHI
J
INTRODUCTION
[1]
This is an opposed urgent application. The urgency is not in issue.
The applicant (Mr Joosub) seeks an order for an interim
interdictory
relief. The application is presented in two parts, Part A and Part B.
[2]
In Part A, Mr Joosub seeks to interdict the first to seventh
respondents (the respondents) from exercising their investigative
statutory powers. In the first place, an order is sought to postpone
the examination of Mr Joosub pending the final determination
(including any appeals) of the relief sought in Part B. Secondly, an
order is sought interdicting the respondents from taking any
steps or
exercising any powers in terms of the Inspection of Financial
Institutions Act 80 of 1998 (the Inspection Act) in relation
to Mr
Joosub, pending the final determination (including any appeals) of
the relief sought in Part B of this application.
[3]
Part B is an application for determination at a later date. In this
application, Mr Joosub seeks an order compelling disclosure
of the
complaints allegedly forming the basis of the inspection as well as
other relevant documents. Mr Joosub also seeks an order
in terms of
the provisions of the
Promotion of Administrative Justice Act 3 of
2000
to review and set aside:
3.1 The Registrar's
decision in terms of sections 2 and 3 of the Inspection Act to
appoint the inspectors and initiate the inspection
into the affairs
of Anglorand Islamic Investments (Pty) ltd and its associated
institutions; and
3.2 The Registrar's
decision in terms of section 9 of the Inspection Act to refuse to
disclose the complaints to Mr Joosub.
[4]
Mr Joosub is represented by Adv R Shana, SC assisted by junior
counsel Adv F Hobden. For all the respondents appeared Adv L
Sisilana. The eighth respondent is not participating. No relief is
actually sought against the eighth respondent who it is said
is cited
only in respect of his interest in the challenge to the
constitutionality of section 8 of the Inspection Act.
[5]
Even though the application was on the urgent roll the parties
provided me with heads of argument, and I am thankful.
[6]
At the end of his address in reply, Mr Joosub's counsel sought to
hand up his notes in rebuttal of the respondent's heads of
argument.
An objection was taken by the respondents' counsel on the basis that
the respondents were not privy to the note at the
time it was sought
to be handed in. This being an urgent court, I am of the view that
the note might enable me to speedily decide
the matter. I as a result
ruled that I will accept the note subject to the respondents' right
to respond thereto, if necessary.
I gave the respondents time until
Friday 3 March 2017 to furnish an answer {if any) to the 'Applicant's
Note in Rebuttal' to the
respondents' heads of argument. The
respondents furnished me with their answer within the stipulated
time.
FACTUAL
MATRIX
[7]
Mr Joosub, is a director of Anglorand Islamic Investments (Pty) Ltd.
During October and November 2016, Mr Joosub received three
summonses
from the Financial Services Board requiring him, in terms of section
4 (1)
(a)
(i) of the Inspection Act, to present himself at an
examination and to produce certain documents.
[8]
In order to prepare for the examination, Mr Joosub requested copies
of the complaints that allegedly formed the basis of the
inspection.
The respondents refused to provide Mr Joosub with the said complaints
claiming that the complaints are protected in
terms of section 8 of
the Inspection Act.
[9]
Mr Joosub seeks the postponement of the examination in the interim
pending the hearing of the review application. In the review
application Mr Joosub seeks to compel the respondents to furnish him
with the said complaints and other documents before the examination
is held.
[10]
The submission by Mr Joosub is that having regard to the inherent
probabilities, it is clear that on the current facts before
this
court, his case meets the requirements for an interim interdict
postponing his examination.
[11]
The respondents on the other hand, contend that no case for
interim relief has been made out by Mr Joosub, who bears the
onus
in that regard.
REQUIREMENTS
FOR INTERIM INTERDICT
[12]
The
requirements for the granting of interim interdict are trite. The
test requires Mr Joosub to establish the following jurisdictional
facts: (i) a
prima
facie
right though open to some doubt; (ii) a reasonable apprehension of
irreparable and imminent harm to the right if an interdict is
not
granted; (iii) the balance of convenience must favour the grant of
the interim relief; and (iv) there must be no other satisfactory
remedy.
[1]
Prima
facie
Right
[13)
The
prima facie
right that an applicant must establish is said
not to be merely the right to approach the court in order to review
an administrative
decision. The right must be viewed in the light of
a right to which, if not protected by an interdict, irreparable harm
would ensue.
The court in
National Treasury and Others v
Opposition to Urban Tolling Alliance and Others
2012 (6) SA 223
(CC) para 50, states the law for interim interdicts pending reviews
as follows:
"Under
the
Setlogelo
test
[1914 AD 221)
, the
prima facie
right
a claimant must establish is not merely the right to approach a court
in order to review an administrative decision. It is
a right to
which, if not protected by an interdict, irreparable harm would
ensue. An interdict is meant to prevent future conduct
and not
decisions already made. Quite apart from the right to review and to
set aside impugned decisions, the applicant should
have demonstrated
a
prima facie
right that is threatened by an impending or
imminent irreparable harm. The right to review the impugned decision
did not require
any preservation
pendente lite."
[14]
It is imperative for Mr Joosub, in order to be granted the interim
relief he seeks in this application, to establish in his
papers a
prima
facie
right
the effect of which will have an irreparable harm should the
interdict not be granted. Due to the interim nature of the
application,
and the circumstances pertaining thereto, I find it not
necessary to resolve the issue of whether Mr Joosub has established a
prima
facie
right
or not. Having read the papers and listened to argument by counsel,
it is evident that most of the arguments traverse issues
which by
right are meant to be argued before, and determined by the review
court. Truth be told, it is not necessary that I at
this stage of the
application determine the cogency of the review grounds, for to do
so, will be to usurp the pending function
of the review court and
thereby anticipate its decision.
[2]
Mr Joosub's counsel suggest that in order to avoid touching on those
issues in my judgment, it would be prudent if I decide this
application only on issues of prospects of success and
prima
facie
right
to a court exercising its powers in terms of section 8 of the
Inspection Act. I do not agree. These, in my view, are still
issues
that go to the merits of the review application and should best be
left for determination by the review court. In order
for me to avoid
traversing that terrain it is my view that this application can be
decided only on the other requirements for interim
relief, namely,
whether failure to grant the interim relief will result in
irreparable and imminent harm to Mr Joosub's right which
the
interdict must protect; and whether the balance of convenience favour
the grant of the interdict; and that Mr Joosub has no
other remedy.
To follow this approach, I have to assume, without deciding, that Mr
Joosub has established a
prima
facie
right
though open to some doubt.
Irreparable
Harm
[15]
Mr Joosub has to establish a reasonable apprehension of irreparable
harm. He must also establish that absent the interim relief,
he will
suffer irreparable harm which the court ought to prevent by granting
interim relief now.
[16]
In his founding papers, and as set out in his heads of argument, Mr
Joosub relies on his right to fair administrative justice
in terms of
s 33 of the Constitution as a right that will be irreparably harmed
should the interdict not be granted. According
to him, if the
examination is not postponed, he will be forced to give information
and answer enquiries without access to any underlying
documentation
or complaints. His right to fair administrative justice will
accordingly be seriously infringed and he will as a
result suffer
irreparable harm. Mr Joosub goes further to set out in detail what he
refers as consequences of his attendance at
the examination without
access to the complaints. His main gripe, as I understand it, is that
the information obtained by the inspectors
and inferences drawn
during the examination will inform the Inspector's Report to the
Registrar. This report will ultimately determine
whether any
regulatory or criminal action will be taken against him and may be
used as evidence in any future proceedings. This
is the irreparable
and imminent harm Mr Joosub will suffer, so it is argued.
[17]
I am inclined to agree with the argument by the respondents' counsel
that the imminent harm Mr Joosub refers to in his papers
is not
irreparable. It is indeed so that what Mr Joosub refers to as
irreparable harm is only but consequences of what will eventuate
should the examination be carried out. There is no doubt that the
Inspectors' Report and any regulatory or criminal action that
may be
recommended in the report may harm Mr Joosub's right that he wants
protected. However, such report and any regulatory or
criminal action
recommended therein stands to be challenged if there are grounds to
do so. In this sense, it cannot be said that
the harm, if any, is
irreparable. Similarly, it cannot be said that Mr Joosub has no other
remedy should the interdict be granted
and the examination continued
with.
[18]
Mr Joosub's counsel in the 'Applicant's Note of Rebuttal', wants to
rectify his argument by stating that Mr Joosub relies on
a right not
to be subjected to unlawful examination. But, this is not what Mr
Joosub pleaded in his founding papers. As stated
in paragraph (16] of
this judgment, Mr Joosub in his founding affidavit relies on his
right to fair administrative justice and
now wants to rely on the
legality of the inspection, that is, a right to be subjected to a
lawful examination in terms of the Inspection
Act. This is
unacceptable.
[19]
It is an established principle that an applicant in motion
proceedings must stand and fall on her or his founding papers and
may
not introduce new issues and arguments in reply. It is also trite law
that in motion proceedings the affidavits serve not only
to place
evidence before the court, but also to define the issues between the
parties. An applicant must also raise the issues
upon which she or he
would seek to rely in the founding affidavit. She or he must do so by
defining the relevant issues and by
setting out the evidence upon
which she or he relies to discharge the
onus
of
proof resting on her or him in respect thereof.
[3]
[20]
Mr Joosub contends in his heads of argument that the requirements for
the granting of interim interdict are traded-off against
each other.
On that score he argues that the stronger Mr Joosub's
prima facie
right, the less the need to rely on prejudice to himself.
Counsel, in this regard, relies on the judgment in
Erikson Motors
Ltd v Protea Motors
1973 (3) SA 85
(A) at 691F.
[21]
This, however, is not the law. The authorities are very clear when it
comes to interim interdict pending a review. It is trite
that a
strong
prima facie
case, absent irreparable harm does not
assist an applicant for an interim relief. Interim interdicts pending
a review are said to
prevent irreparable harm
pendente lite.
The
Constitutional court in the
National Treasury-judgment
above,
has pronounced as much.
[22]
In my view, Mr Joosub has failed to establish the requirement for the
apprehension of irreparable harm if the interdict is
granted. The
harm that Mr Joosub will suffer is only consequential and does not
require protection. In the same breath, Mr Joosub
has in this regard
also failed to establish that he has no other remedy available to him
should the examination not be postponed.
Balance
of Convenience
[23]
In satisfying myself that the balance of convenience favours the
granting of an interim interdict, I must first weigh the harm
to be
endured by Mr Joosub, if interim relief is not granted, as against
the harm the respondents will bear, if the interdict is
granted. All
relevant factors must be assessed carefully in order to decide where
the balance of convenience rests.
[4]
[24]
In terms of section 3 of the Inspection Act, if the registrar has
reason to believe that a person, partnership, company or
trust which
is not registered or approved as a financial institution, is carrying
on the business of a financial institution, he
or she may instruct an
inspector to inspect the affairs, or any part of the affairs, of such
a person, partnership, company or
trust. Even though the Inspection
Act does not clearly set out the purpose for which the affairs of a
financial institution may
be inspected it is my view that such an
inspection is in the interest of actual or potential investors in the
financial institution,
or investors who have entrusted or may entrust
the management of their investments to it.
[5]
[25]
I have already made a finding that the imminent harm that Mr Joosub
talks about is only consequential. Therefore, on the basis
of my view
as expressed in paragraph [24] of this judgment, I have to conclude
that the balance of convenience in this instance,
favours the
respondents.
CONCLUSION
[26]
In my opinion Mr Joosub has not made out a case for interim interdict
and the application ought to be dismissed.
COSTS
[27]
The costs of this application should follow the successful parties,
namely, the respondents.
ORDER
[28]
The application is dismissed with costs.
JUDGE
OF THE HIGH COURT
Counsel for
Applicant: Adv
A Rafik Shana,
SC Adv Frances Hobden
Instructed
by: Knowles
Husain Lindsay Inc
Counsel for
Respondents: Adv
L Sisilana
Instructed
by: Jay
Mothobi Incorporated (For first to seventh respondents)
State Attorney Pretoria
(For eighth respondent)
Date
heard: 01
March 2017
Date of
judgment: 24/03/2017
[1]
See Eriksen Motors (Welkom) Ltd v Protea Motors, Warrenton
1973 (3)
SA 685
(A) at 691C - G and Knox D'Arcy Ltd v Jamieson
[1996] ZASCA 58
;
1996 (4) SA
348
(A) at 372E - G.
[2]
See National Treasury and Others v Opposition to Urban Tolling
Alliance and Others
2012 (6) SA 223
(CC) para 31.
[3]
See Singh and Another v Mount Edgecombe Country Club Estate
Management Association (RF) NPC and Others
2016 (5) SA 134
(KZD)
para 43 and the cases referred therein.
[4]
See National Treasury and Others v Opposition to Urban Tolling
Alliance and Others above para 55.
[5]
See Executive Officer, Financial Services Board v Dynamic Wealth Ltd
and Others
2012 (1) SA 453
(SCA) para 4.