Mittalsteel South Africa Ltd. v Hlatshwayo (326/05) [2006] ZASCA 93; [2007] 1 All SA 1 (SCA); 2007 (1) SA 66 (SCA); 2007 (4) BCLR 386 (SCA) (31 August 2006)

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[2006] ZASCA 93
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Mittalsteel South Africa Ltd. v Hlatshwayo (326/05) [2006] ZASCA 93; [2007] 1 All SA 1 (SCA); 2007 (1) SA 66 (SCA); 2007 (4) BCLR 386 (SCA) (31 August 2006)

Links to summary

REPUBLIC
OF SOUTH AFRICA
THE
SUPREME COURT OF APPEAL
OF
SOUTH AFRICA
REPORTABLE
Case
number: 326/05
In the
matter between:
MITTALSTEEL
SOUTH AFRICA LIMITED
(previously
known as ISCOR LIMITED) Appellant
and
MONDLI
SHADRACK HLATSHWAYO Respondent
CORAM
: MPATI
DP, MTHIYANE, CONRADIE, LEWIS JJA and
CACHALIA AJA
HEARD
: 22
MAY 2006
DELIVERED
: 31
AUGUST 2006
SUMMARY
Promotion
of Access to Information Act 2 of 2002 – appellant a public body
when documents requested by respondent were created –
immaterial
that appellant now a private body – tests for the determination of
whether a body public for purpose of Act.
Neutral
citation: This judgment may be referred to as
Mittalsteel
SA Ltd v Hlatshwayo [2006] SCA 94 (RSA)
___________________________________________________________________________
J U D G M E N T
___________________________________________________________________________
CONRADIE JA
[1] Mr Mondli Hlatshwayo, the respondent, is a very
determined student. His interest in factory regimes in
s
tate
corporations during the late sixties and early seventies led him to
what was then known as ISCOR, the largest steel producer
in South
Africa. He considered their factory regime to be representative of
the period, so for his Master of Arts degree in industrial
sociology
he chose as the topic for his thesis 'The politics of production and
forms of worker responses at ISCOR Vanderbijlpark
Works, 1965 -
1973'.
[2] The material the respondent needed for
his research project was obtainable only from the appellant. Certain
records were made
available by the appellant but when it came to
other records, the appellant took the view that it was not obliged to
and would not
produce them. That refusal led to an application in the
Pretoria High Court before Van der Westhuizen J who in terms of the
Promotion
of Access to Information Act 2 of 2002 (PAIA) ordered the
appellant to make available to the respondent within forty days of
the
date of the order the following documents or copies thereof:
1
'(a) Reports or minutes of meetings
of Iscor Vanderbijlpark works management for the period 1965 to 1973
dealing with labour relations;
(b) Reports
or minutes of meetings of compound or hostel managers of the
Vanderbijlpark works for the period 1965 to 1973;
(c) Reports
or minutes of meetings in respect of wages and conditions of service
at the Vanderbijlpark works for the period 1965
to 1973;
(d) Minutes
of meetings dealing with health and safety issues at the
Vanderbijlpark works for the period 1965 to 1973.'
[3] The appellant sought and obtained leave
from the court
a quo
to appeal against its order. In doing so
it has abandoned a number of minor points relied upon in that court.
In particular, it is
no longer disputed that the appellant's change
of status from a public to a private body has no impact on any
obligation that may
rest upon it to make the requested records
available. The issue before us is therefore a crisp one: whether the
appellant at the
relevant time and in creating the requested
documents
2
was a ' public body' as that term is to be understood in PAIA. If it
was then the respondent is entitled to the documents requested
by it
in terms of s 11 of PAIA. The section is headed ‘Right of access to
records of public bodies’. Subsection 11(1) provides
that a
‘requester
must
be given access to a record of a public body
if’ (emphasis added) (a) the requester complies with all the
procedural requirements
of the Act and (b) access to the record is
not refused in terms of any ground set out in the provisions of PAIA
dealing with the
records of public bodies. None of these provisions
is applicable to the respondent’s request, and compliance with
procedural requirements
is not in issue.
[4] The right of access to information is entrenched in
s 32 of the Constitution of 1996:
'(1) Everyone has the right of access to -
(a) any
information held by the state; and
(b) any
information that is held by another person and that is required
for the exercise and protection of any rights.
(2)
National legislation must be enacted to give effect to this right,
and may provide for reasonable measures to alleviate
the
administrative and financial burden on the state.'
[5] The legislation envisaged by s 32(2) of the
Constitution was enacted as the
Promotion of Access to Information
Act 2 of 2000
. Among the objects of PAIA is that stated in
s 9(a):
'(a)
to give effect to the constitutional right of access to -
(i) any
information held by the State;
and
(ii) any
information that is held by another person and that is
required for the exercise or protection of any
rights;'
PAIA
gives effect to that right subject to justifiable limitations, such
as the reasonable protection of privacy and the balancing
of that
right with other rights.
3
[6] Section 32 of the Constitution does not mention
organs of State. An 'organ of State' in terms of the definition in s
239 means:
'(a)
any department of state or administration in the national,
provincial or local sphere of government; or
(b) any
other functionary or institution -
(i)
exercising a power or performing a function in terms of the
Constitution or a provincial constitution; or
(ii)
exercising a public power or performing a public function
in terms of any legislation, but does not include
a court or a
judicial officer.'
4
[7] PAIA includes within its scope a body that it calls
in s 1 a 'public body', the characteristics of which coincide with
those of
an 'organ of state':
'public
body' means –
'(a)
any department of state or administration in the national or
provincial sphere of government or any municipality
in the
local sphere of government; or
(b) any
other functionary or institution when -
(i)
exercising a power or performing a function in terms of the
Constitution
or a provincial constitution; or
(ii)
exercising a public power or performing a public function in terms of
any legislation.'
[8] The 'organ of state' of the
Constitution is essentially the 'public body' of PAIA. The only
difference between the two is that
a 'public body' does not exclude a
court or judicial officer.
5
Decisions on the meaning of 'organ of state' in the interim
Constitution
6
and the Constitution, of which there are several, are therefore of
considerable assistance in determining what the legislature had
in
mind when it referred to 'public body'.
[9] Moreover, the Promotion of Administrative Justice
Act 3 of 2000 (PAJA) employs the concept 'organ of state' to give
effect to
the constitutional guarantee of administrative action that
is lawful, reasonable and procedurally fair. Among the definitions in
s 1 is that of 'administrative action' which means
' . . . any
decision taken, or any failure to take a decision, by –
(a) an
organ of state, when –
(i)
exercising a power in terms of the Constitution or a provincial
constitution; or
(ii)
exercising a public power or performing a public function in terms of
any legislation; or
(b) a
natural or juristic person, other than an organ of state, when
exercising a public power or performing
a
public function in terms of an empowering provision, which
adversely affects the rights of any person and which has a
direct,
external legal effect, but does not include. . .'.
[10] A body such as that described in ss
(b)(ii) of the definition of ‘public body’ in s 1 of PAIA, one
'exercising a public power
or performing a public function in terms
of any legislation', has the attributes of a 'public body' only when,
in terms of s 8 of
PAIA, it produces a record in the exercise of that
power or the performance of that function. When it does not produce
such a 'public
record', it is a private body in relation to whatever
record it does produce.
7
[11] It appears from the nature of their contents,
indeed it is beyond dispute, that the records requested were produced
in the course
of the appellant's usual business as a steel producer.
If, in carrying out that business, it can be said to have performed a
public
function pursuant to legislation the appellant would fall
within the definition of 'public body' and would be obliged, subject
to
whatever other defences it might have, to give the respondent
access to those records.
[12] It has not been suggested that the appellant at any
relevant time exercised a public power in the sense of being able to
regulate
or control the conduct of others. The only question is
whether it created the record sought by the respondent in the
performance
of a public function in terms of any legislation.
[13] A good starting point for the enquiry
is the decision in
Directory Advertising Cost Cutters v Minister
for Posts, Telecommunications and Broadcasting and Others
8
where it was held that the concept 'organ of state'
9
had to be confined to
‘
.
. .
institutions
which are an intrinsic part of government . . . and those
institutions outside the public service which are controlled
by the
State – ie where the majority of the members of the controlling
body are appointed by the State or where the functions of
that body
and their exercise is prescribed by the State to such extent that it
is effectively in control. In short, the test is whether
the State is
in control.'
The
outcome of the case was that Telkom South Africa Ltd was found to be
an organ of State:
10
'Telkom's
answering affidavit emphasis
es
that it
is incorporated as a company and has a supervisory board of directors
which determines basic policy and a management board,
which is
vested with
executive
authority. It
contends that although the State is its sole shareholder, the State
has no more powers than any other sole shareholder
of a company. That
argument misses the point. A sole shareholder has total control, as
he can control the appointment of directors
who run the company. In
addition, the State has the veto powers in terms of s 7(2) and Telkom
is bound hand and foot to the object
of the State to render a public
telecommunication service. Telkom's function is a function of the
executive. It is in my view an
executive organ of State.'
[14] The
same approach was followed, also under the interim Constitution, in
Mistry v Interim
National
Medical and
Dental Council of South Africa
11
and in
Wittmann v Deutscher Schulverein, Pretoria.
12
Before the enactment of PAIA, under the transitional provisions of
the Constitution,
13
the reasoning was followed in
ABBM Printing and Publishing (Pty)
Ltd v Transnet Ltd
14
and
Goodman
Bros
(Pty) Ltd v Transnet
Ltd
.
15
[15]
Directory Advertising Cost Cutters
was approved by a full bench of the Transvaal Provincial Division in
Lebowa Mineral Trust v Lebowa Granite (Pty) Ltd,
16
an access to information case under s 23 of the Interim Constitution.
After an analysis of the composition of the board of trustees
and the
objects of the trust the court concluded that:
'From the
above it is clear that the board is government-appointed and that its
tenure exists at the pleasure of the government. In
addition . . . in
determining whether LMT is an organ of State the board is of little
consequence in view of its advisory function.
LMT is in fact
controlled by its trustee (the President) and his delegate, the
Minister. To this can be added the fact that . .
. the accounts of
the trust shall be audited annually by the Auditor-General, material
provisions in the Exchequer Act 66 of 1975
are applicable
mutatis
mutandis
and the Auditor-General's report is to be tabled in
the Legislative Assembly. In terms of s 19 of the Act the Minister,
in consultation
with the trustee, may make regulations pertaining to,
inter
alia
, the regulation of the conduct of the
business of the trust. There can be no doubt that this is an organ
of state.'
[16] In
Transnet Ltd v Goodman Brothers
(Pty) Ltd
17
Schutz JA, in the context of fair administrative action, dealt with
the rejection of the respondent's tender for the supply of watches
to
the appellant in the following way:
'Turning to
the first question, whether administrative action was involved, it
has already been held in this Court that the State
Tender Board's
handling of tenders for transport service for the government
constituted administrative action — in
Umfolozi Transport (Edms)
Bpk v Minister van Vervoer en Andere
[1997] ZASCA 8
;
[1997] 2 All SA 548
(SCA)
at 552
j
-553
a
Howie JA pointed out that the steps that had preceded the
conclusion of a contract were purely administrative actions and
decisions
by officials, whilst in addition public money was being
spent by a public body in the public interest. Naturally, said Howie
JA,
in such a case the subject is entitled to a just and reasonable
procedure. I agree entirely. Moreover, the same considerations
apply to Transnet.
I do not
think that anything can be made of the fact that Transnet is now a
limited company. The government still owns all the shares
in it and
thus has ultimate control. It still provides a general service to
the public, even though it is now competition- and profit-orientated.
It still has a near-monopoly over rail transport.'
[17] An article by V K Moorthy entitled
'The Malaysian National Oil Corporation -- Is it a Government
Instrumentality?'
18
has attracted attention in three decisions of our courts.
19
The issues were different to those now under consideration. The
courts were concerned with ascertaining the extent of the doctrine
of
sovereign immunity and thus determining whether the assets of a body
said to be an organ or agent or instrumentality of a foreign
government were liable to be attached. The test put forward by the
author is nevertheless valuable for the present enquiry as well.
He
writes:
20
'The
c
ourts
have evaluated the relationship between the Government and a
statutory corporation for the purpose of determining whether or
not
the corporation is a Government instrumentality by the application of
various tests.
The tests
are as follows:
(1) Whether the body has any discretion of its own; if
it has, what is the degree of control by the Executive over the
exercise of
that discretion;
(2) Whether
the property vested in the corporation is held by it for and on
behalf of the Government;
(3) Whether the corporation has any financial autonomy;
(4) Whether
the functions of the corporation are Governmental functions.
'
Commenting
on the application of the various tests, the author says:
21
'Of all the
above-mentioned test the
c
ourts have
tended to regard the test of control as the most important factor,
although in some cases the question of whether the function
of the
body is a governmental function has also received some consideration.
If the degree of control is significant, the functional
test has
been held to be of little or no importance.'
[18] This
court adopted the approach that control, although important, was not
the only feature to be considered when it said in
Greater
Johannesburg Transitional Metropolitan Council v Eskom
:
22
'The
CWRSC and the appellant are statutory bodies entrusted with wide
functions of government at regional or local level. They have
the
power to raise money from the public and the duty to spend their
income on the supply of essential services in the public interest.

In determining whether these bodies are organs of the State the
question of control is not decisive. What is of importance is the
need to decide what functions they perform — whether they carry out
functions of government at a local level.'
[19]
Minister of Education, Western Cape
and others v Governing Body Mikro Primary School
23
gave this court the opportunity of pointing out that 'any institution
exercising a public power or performing a public function in
terms of
any legislation is an organ of State’. That is, with respect,
correct and was as far as it was necessary for the court
to go. The
control test was not needed. The school governing body was obviously
performing a public function and thus was an organ
of State. The
control test is useful in a situation when it is necessary to
determine whether functions, which by their nature might
as well be
private functions, are performed under the control of the State and
are thereby turned into public functions instead.
This converts a
body like a trading entity, normally a private body, into a public
body for the time and to the extent that it carries
out public
functions.
[20] English jurisprudence follows the same
road. De Smith Woolf and Jowell in
Judicial Review of
Administrative Action
24
say this:
'For a great
many years the way in which the courts have identified the activities
which are subject to public law is by deciding
whether or not they
are activities to which the High Court's supervisory jurisdiction of
judicial review may be invoked by aggrieved
persons. In the past
this was mainly done by asking what was the
source of the power
being exercised by the decision-maker whose action was impugned.
Where the power was statutory or, more recently, derived from the
prerogative, then that jurisdiction could be invoked. Where,
however, powers were conferred solely by a contract (such as an
arbitration
agreement or an agreement governing the relationship
between members of an unincorporated association), judicial review
generally
was not available. Today, the courts recognise such an
approach is too restrictive and they are now influenced by the type
of
function
performed
by the decision-maker whose
action is challenged. Where a body is carrying out a public function
(such as that undertaken by a non-government
regulatory organisation
in relation to the area of activity which is subject to its control),
the courts will consider intervening
to require compliance with the
principles of judicial review. This is the case even if the body is
non-statutory, exercising powers
which are not derived either from
legislation or the prerogative.
A body is
performing a "public function" when it seeks to achieve
some collective benefit for the public or a section of
the public and
is accepted by the public or that section of the public as having
authority to do so. Bodies therefore exercise public
functions when
they intervene or participate in social or economic affairs in the
public interest. This may happen in a wide variety
of ways. For
instance, a body is performing a public function when it provides
"public goods" or other collective services,
such as health
care, education and personal social services, from funds raised by
taxation.'
[21] The authors also discuss various tests
employed by English courts to determine whether a body is subject to
judicial review of
its actions. They are, in summary:
25
1 Whether, but for the existence of a non-statutory
body, the government would itself almost inevitably have intervened
to regulate
the activity in question;
2 Whether the
government has encouraged the activities of a body by providing
underpinning for its work or weaving it into the fabric
of public
regulation or has established it under the authority of government;
3 Whether the
body was exercising extensive or monopolistic powers.
[22] I mention these approaches not because the control
test is inappropriate in the present case but to emphasise that the
test may,
under given circumstances, not be the most suitable one. In
an era in which privatization of public services and utilities has
become
commonplace, bodies may perform what is traditionally a
government function without being subject to control by any of the
spheres
of government and may therefore, despite their independence
from control, properly be classified as public bodies.
[23] The appellant was incorporated by the Iron and
Steel Industry Act 11 of 1928 under the name of the South African
Iron and Steel
Industrial Corporation Limited. Later it was called
ISCOR and later still changed its name to Mittalsteel South Africa
Limited. It
was converted into a public company under the Companies
Act 61 of 1973 by the Conversion of Iscor, Limited, Act 57 of 1989
and is
now listed on the Johannesburg Securities Exchange. It is
common cause that it is now free from government control and that,
whatever
its status between 1965 and 1973, it is no longer a 'public
body' as envisaged in PAIA.
[24] The purpose of the 1928 Act appears in its
preamble:
'To
promote the development in the Union of the Iron and Allied
Industries and for that purpose to constitute the South African Iron
and Steel Industrial Corporation Limited.'
The company was to be established by proclamation and
was empowered, subject to the Act and the regulations, to do whatever
was necessary
to carry out its objects in terms of the Act. The
proclamation was deemed to be Iscor's memorandum of association, a
document that
could not be amended otherwise than by an Act of
Parliament. Iscor's operations were controlled by a board of
directors of whom the
majority were, in the manner prescribed by
regulation, appointed by the Governor-General (later the State
President), who was also
empowered to appoint as managing director
any member of the board, as well as the chairman of the board from
among the directors
appointed by private shareholders.
[25] The conditions of appointment, eligibility for
re-appointment and remuneration of members of the board appointed by
the State
President were determined by him. The tenure of board
members appointed by private shareholders was governed by regulation.
Rules
made by the board were subject to ministerial approval.
[26] Shares could be issued only with the approval of
the State President and any conversion of shares, an increase of
share capital
or the issue of debentures (the repayment of which was
guaranteed by the State) required his approval. The distribution of
dividends
was prescribed by the Act.
A
large
part of its business was even prescribed by the Act which required a
ten-year contract to be entered into obliging Iscor to
sell steel to
the South African Railway and Harbour Administration.
[27] The government held 'A' shares in Iscor while the
public held 'B' shares but the shareholding was structured in such a
way that
the votes exercisable by the government always exceeded by
one the total number of votes by all the other shareholders. Within
fourteen
days of the commencement of every session of parliament an
audited balance sheet and profit and loss account signed by Iscor's
auditors
for the preceding financial year and an annual report
detailing all its operations had to be tabled in the two Houses of
Parliament.
The appellant was without a doubt subject to the State's
control, perhaps indirect, but firm all the same. And it most
certainly
meets the tests for being a public body discussed in the
literature and cases set out above.
[28] The appellant was thus, at the relevant time, and
when exercising the functions in respect of which the respondent
requested
records, a ‘public body’ for the purpose of s 11 of
PAIA. It was not seriously contended that the documents did not come
into
existence in the course of Iscor's pursuing its activities. The
respondent is thus entitled to access to those records.
[29] There is disagreement between deponents for the
appellant on whether the requested documents have been destroyed or
whether they
still exist and, if they do, whether there is a
reasonable prospect of finding them. It was therefore sensible for
the court
a quo
to have allowed the appellant a period of
forty days to mount a reasonable search for them. Our order must
make allowance for the
period to start running from the date of this
judgment.
[30] Where the expression 'this order' appears in
paragraphs 1 and 3 of the order of the court
a quo
it should
be read as if it refers to the order of this court. Save for this
emendation, the appeal is dismissed with costs.
J H
CONRADIE
JUDGE OF APPEAL
CONCUR:
MPATI DP
MTHIYANE
JA
CONRADIE
JA
LEWIS JA
CACHALIA
AJA
1
Other,
contingency, provisions of the order are not contentious and need no
mention here.
2
The
documents are 'records' as defined in s 1 of PAIA: ' "Record"
of, or in relation to, a public or private body, means
any recorded
information:
(a) regardless of form or
medium;
(b) in the possession or
under the control of that public or private body, respectively; and
(c) whether or not it was
created by that public or private body, respectively.'
3
Section
9(b)(i) and (ii).
4
Item
23 of the sixth schedule to the Constitution in force for the period
preceding the adoption of legislation in terms of s 32
of the Bill
of Rights gives to every person the 'right of access to all
information held by the state or any of its organs in any
sphere of
government…'. The section restricted the right to information
required for the exercise or protection of a right.
5
It
was unnecessary to write in this exclusion as part of the
definition. Section 12 of PAIA provides that it does not apply to a
record relating to the judicial functions of a court referred to in
s 166 of the Constitution, that is to say all superior and
inferior
courts as well as any court established or recognized by an Act of
Parliament.
6
The
access to information section of the interim constitution, s 23,
gives a person the right to access to information held by the
state
or any of its organs at any level of government. 'Organ of state' is
defined in s 233 as including any statutory body or
functionary.
7
A
‘record’ is defined in relation to both a public and private
body as meaning ‘any recorded information –
(a) regardless of form or
medium;
(b) in the possession or
under the control of that public or private body, respectively; and
(c) whether or not it was
created by that public or private body, respectively.'
8
1996
(3) SA 800
(T).
9
The
term was analysed in relation to the definition of 'organ of state'
in the Interim Constitution.
10
808F-G.
11
1998
(4) SA 1127
(CC).
12
1998
(4) SA 423
(T) at 454B-E.
13
Item
23(2)(a) of Schedule 6.
14
1998
(2) SA 109
(W) at 113B-E.
15
1998
(4) SA 989
(W).
16
2002
(3) SA 30
(T) at 36.
17
[2000] ZASCA 151
;
2001
(1) SA 853
(SCA) paras 7 and 8.
18
(198
1
)
30
International and Comparative Law Quarterly
638.
19
Banco de Mocambique v
Inter-Science Research and Development Services (Pty) Ltd
1982 (3) SA 330
(T);
The Shipping Corporation of India Ltd v
Evdomon Corporation
[1993] ZASCA 167
;
1994 (1) SA 550
(A);
Greater
Johannesburg Transitional Metropolitan Council v Eskom
2000 (1)
SA 866
(SCA).
20
Pp
640—641.
21
P
641.
22
Para
12.
23
2006
(1) SA 1
(SCA) para 20.
24
(1995)
5 ed p 167.
25
P
170.