Summary of Judgment

1. Introduction

This matter concerned an urgent application brought in the Constitutional Court for an order varying and extending a previously ordered suspension of a declaration of constitutional invalidity. The applicants were the Minister for Transport and the Road Accident Fund, and the respondents were Anele Mvumvu, Louise Pedro, and Bianca Smith.

The application arose from an earlier Constitutional Court judgment in which specified portions of section 18 of the Road Accident Fund Act 56 of 1996 (as they read before 1 August 2008) had been declared inconsistent with the Constitution and invalid, but the declaration of invalidity was suspended for 18 months to allow Parliament to cure the defect. The original suspension period was due to expire on 17 August 2012 (the original order having been granted on 17 February 2011).

When it became apparent that Parliament would not complete the legislative cure within the original suspension period, the applicants launched the present application on 2 July 2012. The matter was set down for hearing on 14 August 2012. The respondents did not oppose the relief sought. The Court granted an order on 14 August 2012 extending the suspension, with reasons delivered on 27 September 2012.

The general subject-matter of the dispute was therefore not the underlying constitutionality of section 18 (which had already been determined), but the appropriate constitutional remedy: specifically, whether it was just and equitable to extend the suspension of the declaration of invalidity to avoid the invalidity taking effect before Parliament enacted corrective legislation.

2. Material Facts

It was common cause that, in the earlier matter, the Constitutional Court declared sections 18(1)(a)(i), 18(1)(b), and 18(2) of the Road Accident Fund Act 56 of 1996 (in their pre–1 August 2008 form) invalid, while suspending that declaration for 18 months to allow Parliament to cure the defect. It was also undisputed that the suspension period would expire on 17 August 2012.

The applicants’ factual explanation for the delay in curing the defect proceeded chronologically. They stated that drafting work on an amendment bill commenced immediately after 17 February 2011. Although the amendment was initially expected to be short, the applicants explained that drafting proved difficult because it required balancing considerations relating to proper compensation of road accident victims against the risk of substantial unbudgeted expenditure that was said to be financially unsustainable, and also required investigation into the effect of proposed amendments on common-law claims against individual wrongdoers.

After a bill was produced, a consultation process followed in which interested parties were invited to make representations. According to the applicants, many comments were critical, raising concerns of unfairness and workability. A decision was taken to revise the bill to address those concerns. The revised bill was submitted to the Chief State Law Advisor in February 2012, where technical amendments were suggested. Before Cabinet consideration, the bill was forwarded to the Joint Cluster for Social Protection, Community and Human Development. Cabinet approved the bill on 30 May 2012, and the bill was submitted to Parliament on 6 June 2012, being referred to the relevant parliamentary committees.

A further fact relied upon by the Court was that Parliament went into recess and only reconvened on 24 July 2012, which, on the applicants’ version, meant the bill could not complete the necessary legislative stages before the suspension period expired. On this basis, the applicants sought an extension before expiry of the suspension. The respondents did not oppose the application.

In motivating why an extension would matter, the applicants also placed before the Court their estimate that if the declaration of invalidity took effect, the Road Accident Fund’s financial liability would increase by approximately R2.263 billion, as opposed to an additional R1.3 billion if the bill took effect before expiry of the extended suspension; they contended this would add to the Fund’s accumulated deficit and cause financial instability, including an unbudgeted expenditure of almost R1 billion if the suspension lapsed in August 2012.

In addition, the applicants relied on the earlier judgment’s indication that other provisions of the Act suffered from the same defect but had not been directly impugned; they contended that allowing the invalidity to take effect without a broader legislative response would perpetuate unequal treatment for claimants regulated by those other provisions, whereas the bill before Parliament was said to address both the respondents’ position and that of those other claimants.

3. Legal Issues

The central legal questions were whether, before expiry of a previously ordered suspension of a declaration of invalidity, the Constitutional Court had the power to extend the period of suspension, and if so, whether extending it in the circumstances would be just and equitable.

The dispute primarily concerned the application of constitutional remedial principles to the established facts. It required an evaluative judgment concerning remedy, rather than a re-determination of the underlying constitutional invalidity. The Court also had to navigate the remedial discretion under section 172(1) of the Constitution alongside the limiting principle that, once a final order is granted, a court is ordinarily functus officio, which bears on when and how an existing order may be revisited.

4. Court’s Reasoning

The Court located its authority in section 172(1) of the Constitution, which empowers a court deciding a constitutional matter to declare inconsistent law invalid and to make any order that is just and equitable, including an order suspending a declaration of invalidity for a period to allow the competent authority to correct the defect. The Court accepted that the suspension mechanism is aimed at preventing disruptive consequences while enabling legislative correction.

The Court then addressed the situation where Parliament is unable to cure the defect within the original suspension period. It stated that, in such circumstances, an extension may be sought to prevent the declaration of invalidity from coming into operation. Critically, it emphasised a timing constraint: the request and the decision to extend must occur before the suspension expires, because once expired, the suspension cannot be extended or revived. In support of the Court’s continuing power to adjust suspension during the suspension period, the Court relied on Zondi v MEC, Traditional and Local Government Affairs and Others, which recognised that during the suspension period the Court retains power to reconsider the continued suspension, the period, and the conditions, where the facts have changed or the full implications were not previously apparent, provided this occurs before expiry and is just and equitable.

At the same time, the Court emphasised that this power is not lightly exercised because of the principle that, once a court has delivered a final order, it becomes functus officio and cannot correct, alter, or supplement the order. For this proposition the Court referred to Firestone South Africa (Pty) Ltd v Gentiruco A.G. The Court thus framed the enquiry as a careful exercise of remedial discretion that must be balanced against the need for finality in litigation.

The Court then identified factors relevant to whether an extension would be just and equitable. These included the sufficiency of the explanation for the failure to comply within the original period, the prejudice likely to follow if the suspension were not extended, the prospects of curing the defect within the extended period, and the public interest in promoting functional and orderly state administration. The Court referred in this regard to Ex Parte Minister of Social Development and Others and Zondi.

Applying those factors, the Court was satisfied that an acceptable explanation had been tendered for the failure to cure the defect within the original period. The drafting complexity, the public consultation and revision process, and the legislative pathway (including Cabinet approval and parliamentary referral), together with the parliamentary recess, were treated as explaining why the remedial legislation could not be enacted in time.

On the question of whether it was just and equitable to extend, the Court accepted two principal considerations advanced by the applicants. First, it accepted that the immediate coming into operation of the invalidity order would significantly increase the Road Accident Fund’s financial liability, with adverse consequences for the Fund’s fiscal stability and unbudgeted expenditure. Second, the Court accepted the applicants’ reliance on the earlier judgment’s observation that similar defects existed elsewhere in the Act; it accepted that allowing the invalidity to take effect without an encompassing legislative solution could produce unfair consequences by leaving other claimants subject to inequality that the new bill aimed to address.

Finally, while the applicants had estimated a shorter period for enactment, it emerged at the hearing that a longer period was realistic. In those circumstances, the Court concluded that extending the suspension by six months was just and equitable.

5. Outcome and Relief

The Constitutional Court varied paragraph 2 of its earlier order in Mvumvu and Others v Minister for Transport and Another 2011 (2) SA 473 (CC) by extending the period of suspension of the declaration of invalidity for a further six months.

The reported order, as set out in the reasons, was confined to the variation and extension of the suspension period. The reasons do not record any separate costs order in respect of this extension application.

Cases Cited

Mvumvu and Others v Minister for Transport and Another [2011] ZACC 1; 2011 (2) SA 473 (CC); 2011 (5) BCLR 488 (CC)

Zondi v MEC, Traditional and Local Government Affairs and Others [2005] ZACC 18; 2006 (3) SA 1 (CC); 2006 (3) BCLR 423 (CC)

Ex Parte Minister of Social Development and Others [2006] ZACC 3; 2006 (4) SA 309 (CC); 2006 (5) BCLR 604 (CC)

Firestone South Africa (Pty) Ltd v Gentiruco A.G. 1977 (4) SA 298 (A)

Legislation Cited

Constitution of the Republic of South Africa, 1996, section 172(1)

Road Accident Fund Act 56 of 1996, section 18(1)(a)(i), section 18(1)(b), and section 18(2)

Rules of Court Cited

No rules of court are cited in the reasons.

Held

The Court held that, under its section 172(1) remedial power to make orders that are just and equitable, it retains authority during the period of suspension of a declaration of invalidity to extend that suspension, provided the extension is sought and granted before the suspension expires.

On the facts, the Court held that the applicants provided a sufficient explanation for Parliament’s inability to enact remedial legislation within the original period. The Court further held that extending the suspension was just and equitable in light of the potential financial prejudice to the Road Accident Fund if invalidity took immediate effect, and in light of the unfair consequences identified in the earlier judgment that would persist without a broader legislative response.

LEGAL PRINCIPLES

Section 172(1) of the Constitution empowers the Constitutional Court to craft just and equitable remedies after declaring legislation unconstitutional, including suspending a declaration of invalidity to allow legislative correction.

During the period of a suspension, the Court retains power to reconsider and adjust the period and conditions of suspension if it is just and equitable to do so, but any extension must be granted before the suspension expires, because an expired suspension cannot be revived.

The discretion to extend a suspension is constrained by the principle of functus officio and the value of finality in litigation, and is therefore exercised only where a persuasive basis exists.

In determining whether extension is just and equitable, relevant considerations include the adequacy of the explanation for non-compliance within the original period, the likely prejudice if invalidity takes effect immediately, the prospects of curing the defect within the extended period, and the public interest in functional and orderly administration.