News

Is this transaction protected under Consumer Protection Act 68 of 2008?

Often a question posed as the weary consumer, but are you getting the right answer?

Today’s scenario:

You wish to enter into an Installment Sale Agreement to purchase a new car. The seller and/or institution, who is assisting with the closing, advises that the National Credit Act 34 of 2005 and the consumers related rights provided therein are applicable to this transaction.

 

You ask, but does that mean that my rights under the Consumer Protection Act 68 of 2008 (the “Act”) will not apply?

Answer: No!

Section 5 of the Act provides that the Act is not applicable to credit agreements (which includes Installment Sale Agreements) as defined in the National Credit Act, save for application of Section 60 and 61 of the Act (which deals with safety and damages due to failure of a product). However the Act further provides that it will apply to your Installment Sale Agreement or any credit agreement, where the subject of the agreement is goods or services, in so far as it pertains to those goods or services.  Therefore both the National Credit Act 34 of 2005 and the Consumer Protection Act 68 of 2008 will apply to your transaction – the purchase of a new car, when you are buying the car by means of an Installment Sale Agreement.

 

What are your key consumer rights under the Consumer Protection Act 68 of 2008  –

Right to Equality in the Consumer Market and Protection Against Discriminatory Marketing Practices;
Right to Privacy;
Right to Choose;
Right to Disclosure of Information;
Right to Fair and Responsible Marketing;
Right to Fair and Honest Dealing;
Right to Fair, Just and Reasonable Terms and Conditions;
Right to Fair Value, Good Quality and Safety; and
Right to Accountability by Suppliers.

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The compensation ordered for the developer of 'please call me' a reminder to companies to regulate internal intellectual property policies

The Constitutional Court recently handed down judgment in the case concerning the compensation for the use of the idea of developing the Please Call Me messaging system for Vodacom, which resulted in generating billions of rands. Mr. Makate –who claims he developed the mechanism – was a trainee accountant employed by Vodacom during 2000 when he was involved in a long distance relationship with a student. The couple experienced communication difficulties because his girlfriend was unable to afford airtime in order to make telephone calls to him. As a result, he developed the idea of the Please Call Me messaging system and approached Vodacom’s Director of Product Development and Management and the two entered into a verbal agreement whereby Vodacom would use the idea on a trial basis to establish commercial viability and if it proved to be so, then Mr. Makate would be paid a share of the proceeds.

 

Mr Makate was unsuccessful in the High Court with his claim based on the verbal agreement and after both the trial Court and the SCA refused to grant him leave to appeal he approached the Constitutional Court. The CC ordered Vodacom to compensate Mr. Makate for using his idea, finding that Vodacom’s Director of Product Development and Management had the apparent authority to bind Vodacom in the verbal agreement.

 

In light of this judgment, companies need to ensure that in protecting their intellectual property assets that they regulate the creation and ownership thereof by having proper internal policies and procedures in place.

 

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Enforcing a South African maintenance order in a foreign country

The Reciprocal Enforcement of Maintenance Orders Act allows a parent living in South Africa to claim maintenance from a parent living in a foreign country and vice versa.

 

South Africa, however, only has reciprocal enforcement agreements with Australia, Botswana, Canada, Cocoa Islands, Cyprus, Fiji, Germany, Guernsey, Hong Kong, Isle of Jersey, Isle of Man, Kenya, Lesotho, Malawi, Mauritius, Namibia, New Zealand, Nigeria, Norfolk Island, Sarawak, Singapore, St Helena, Swaziland, United Kingdom, United States of America (restricted to California), Zambia and Zimbabwe.

 

This means that a maintenance order (provisional or final) granted in any one of the listed countries or territories is enforceable in South Africa.

 

If the country in question, however, is not a proclaimed country in terms of the Act, legal proceedings must be instituted in the foreign court. This is generally a more time consuming and costly process.

 

In order to enforce a maintenance order in proclaimed countries and territories, the following documentation must be sent to the Department of Justice and Constitutional Development:

a) Four certified copies of the provisional court order.
b) Four certified copies of the affidavit by the complainant or an officer of the court as to the amount of arrears due under the order.
c) Four certified copies of the affidavit or evidence of the complainant.
d) Birth certificate(s) of the child or children.
e) Marriage certificate (if applicable).
f) A photograph and description of the defendant.
g) The exhibits referred to in the complainant’s affidavit or evidence.
i) Physical residential and or working address of the defendant in a proclaimed country.

 

For more information on the enforcement of maintenance orders see: http://www.justice.gov.za/ilr/intmnt.html

 

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Environmental licenses and permits now automatically available to the public

The Department of Environmental Affairs (DEA) has recently made environmental licenses automatically available to the public. Unlike the previous position, licenses will now become available without having to submit a request in terms of the Promotion of Access to Information Act (PAIA). This announcement from the DEA came after the Centre for Environmental Rights (CER) pushed to have environmental licences and compliance data, including the PAIA reports, made accessible online to the public.

 

Environmental licenses and permits set out the compliance requirements when conducting a potentially environmentally harmful activity. The CER emphasized the difficulty in accessing this information and argued that the public has a right to know how to comply with the license requirements, especially since non-compliance may result in the suspension or withdrawal of licenses, and in some cases, lead to a criminal offence.

 

The permits that the DEA has now published include various environmental authorisations, waste management licences, atmospheric emission licences, Biodiversity Act permits and general permits for boat-based whale watching and shark cage diving.

 

The CER has commended the DEA “for its commitment to open governance and realisation of the Constitutional rights to access to information, just administrative action and environmental rights”.

 

The notice published by the DEA provides that members of the public may email Phumzile Sabeka at PSabeka@environment.gov.za, for copies of these licences.

 

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The Copyright Infringement Judgment – Moneyweb v Fin24

Judgment was recently granted out of the Gauteng High Court (Johannesburg) in favour of Moneyweb against Fin24 for copyright infringement. The court found that three of the seven articles published by Fin24, were in part original works of Moneyweb and that Moneyweb had shown that one of the articles had in fact infringed Moneyweb’s copyright.

 

Where the articles fell short of proving a copyright infringement was in terms of Section 12(1) of the Copyright Act, which provides that

“Copyright shall not be infringed by any fair dealing with a literary or musical work… for the purpose of reporting current events…in a newspaper, magazine or similar periodical…provided that… the source shall be mentioned, as well as the name of the author if it appears on the work.”

 

Section 12(1) of the Copyright Act, said the Court, only becomes relevant after it is established that there has been a substantial reproduction of the work. Furthermore, despite substantial reproduction, if the party who has reproduced the work can prove that it dealt ‘fairly’ with the work, then that party will not be liable for copyright infringement. The court will take into account certain factors when considering ‘fairness’.

 

The court found that publishing the article entitled “Amplats:CEO cits JSE rules” constituted an infringement of Moneyweb’s copyright under the Copyright Act, and further declared that Fin24 liable to Moneyweb for damages suffered as a result of the unlawful publication.

 

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Law of Property Casebook for Students (Eighth Edition) By AJ van der Walt- Reviewed by FWB's Louis Rood

If legislation is the recipe of law, then court cases are the ingredients. It

is the judgments of our courts that both interpret and apply the law,

evaluate the evidence, asses the facts, and establish the precedents

upon which we all rely.

 

The 60 cases selected for this book include not only some of the classic

decisions dealing with the law of property, but others that are particularly

interesting, recent or topical, and demonstrate a number of important

points or principles. Wisely, the author has avoided long and difficult

judgments and rather opted for relatively brief and more pertinent

decisions.

 

This is the eighth edition of this popular casebook, which forms a

companion volume to another work in the Juta Property Law Library,

namely Introduction to the Law of Property (2016 Juta) by the same

author with Professor Gerrit Pienaar.

 

The book contains both a bilingual English and Afrikaans version for

reasons of economy and will reach a wide readership of students and

practitioners of property law. Useful and practical hints on the reading

and analysis of both cases and legislation are included. There are

explanatory notes and commentary on each of the cases, and where

appropriate, the facts of each case are summarised.

 

The cases are conveniently grouped to deal with the various aspects of

the law of property, such as ownership, possession, limited real rights in

property such as servitudes, and constitutional property law. Extracts

from selected legislation such as the Prescription Act, Deeds Registries

Act, Security by Means of Movable Property Act and the Insolvency Act

compliment the text.

 

The distinguished author Professor Andre van der Walt BIur Hons(BA)

LLB LLM LLD of Stellenbosch University has with this work continued to

contribute to and further consolidated the ever-growing and

comprehensive range of the Juta Property Law Library series in this

very important branch of private law. Students who will become the

property lawyers and judicial officers of the future will welcome and

benefit from this quality casebook.

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Lessor permitted to evict lessee upon valid termination of the lease despite lessor's lack of title

In a recent case involving Engen, the Constitutional Court (CC) has found that a subtenant is not allowed to raise a sub-lessor’s lack of title as a defence to eviction. In this matter, Engen Petroleum Ltd (Engen), entered into a lease agreement with the owner of a property. Engen then sublet the property to Mighty Solutions, the applicant, to operate an Engen-branded service station.

Some time later, Engen terminated the sublease and provided Mighty Solutions with the required notice period to vacate. Mighty Solutions, however, did not vacate and continued to operate its business using Engen’s equipment and signage – without paying rental. Following the termination of the main lease, Engen applied for an eviction order against Mighty Solutions.

The High Court found that a lessor (or sub-lessor) is allowed to evict a lessee (or sub-lessee) upon the valid termination of the lease, even if that lessor has no title to the property.

After being refused leave to appeal against this decision by the Supreme Court of Appeal, Mighty Solutions applied to the CC. The CC unanimously agreed with the High Court’s decision that a lessee or sub-lessee, upon valid termination of a lease, cannot resist eviction on the basis that a lessor or sub-lessor has not proved a right to occupy the property. The CC emphasized that this rule serves a valuable purpose and is consistent with the spirit, purport and object of the Bill of Rights and therefore ought not to be developed.

Read the judgment here: http://www.saflii.org/za/cases/ZACC/2015/34.html

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ARIPO Developments

There are currently 19 States which are party to the Lusaka Agreement and therefore members of the African Regional Intellectual Property Organization (ARIPO). These are: Botswana, The Gambia, Ghana, Kenya, Lesotho, Malawi, Mozambique, Namibia, Sierra Leone, Liberia, Rwanda, São Tomé and Príncipe, Somalia, Sudan, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe.

ARIPO patents, utility models and industrial designs are governed by the Harare Protocol on Patents and Industrial Designs and Regulations whilst the ARIPO trade marks are governed by the Banjul Protocol on Marks and Regulations. This was updated on 17 November 2015 and has led to the implementation of various developments including fee increases from 1 January 2016.

The definition of a ‘mark’ has also been expanded to include ‘a sign, name, word, device, brand, heading, level signature, letter, numeral or a combination thereof’. Another welcome development will be launch of electronic filings, expected in near the future.

The ARIPO system covers all Member States but the regional system complements the national industrial property system of its Member States. The sovereignty of Member States remains with each designated State having a significant say as to whether any industrial property right given by ARIPO would have effect in the State concerned.

Generally, it is a recommended route when looking to obtain patent and design registrations in the Member States. However, this is not the case with trade mark protection and it is often advised not to rely on an ARIPO trade mark registration and rather apply for protection in the individual states.

 

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The constitutional right to emergency medical treatment

Last year, the Constitutional Court (CC) highlighted the importance of the constitutional right to emergency medical treatment. The case involved a 17 year old boy who had experienced serious spinal cord injuries whilst playing rugby. The hospital that first assessed the boy did not have the facilities to treat him and so he was eventually transferred to a larger hospital after waiting a long time for an ambulance. Although the larger hospital had the equipment necessary to treat him, the decision was made to transfer the boy to another hospital that specialised in spinal cord injuries. He was finally admitted for his procedure fourteen hours after sustaining the injuries. Unfortunately, due to lack of blood supply, the boy suffered paralysis from the neck downwards which resulted in permanent quadriplegia.

An application was then brought to the Cape Town High Court which ruled that the Western Cape Department of Health was liable for the damage caused by the injuries sustained as a result of the failure to provide the necessary emergency treatment.

This decision was reversed by the Supreme Court of Appeal before it eventually made its way on appeal to the CC. A medical expert suggested that if the boy had received reasonable medical attention within four hours, there was a 64% chance of making a full or substantial recovery from harm of permanent quadriplegia. The CC emphasized that the law requires hospitals to provide urgent and appropriate medical emergency medical treatment to a person in the position of the applicant. The Western Cape Department of Health had failed to provide a reasonable explanation for the delays in performing a simple and inexpensive procedure that was both available and necessary. The CC therefore decided that the Western Cape Department of Health had breached its legal duty to provide the applicant with urgent medical treatment and had acted unlawfully.

Read the judgment here: http://www.saflii.org/za/cases/ZACC/2015/33.pdf

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FWB Associate, Brittany Badham-Thornhill, provides some wisdom on wills on personal finance and insurance website Hippo.co.za

Brittany Badham-Thornhill recently contributed to an article entitled “Write a Will and Protect Your Legacy” on personal finance and insurance website, Hippo.co.za.

Here are some excerpts from the article:

“Unlike things like Life Insurance and Funeral Cover policies, you don’t have to be over 18 to draw up a will to determine what happens to your belongings when you pass away. Brittany Badham-Thornhill, associate attorney at Fairbridges Wertheim Becker Attorneys says that according to South African law, in terms of Section 4 of the Wills Act 7 of 1953, you only need to be 16 years or older to make a will, unless you are mentally incapable of appreciating the nature and effect of entering into a will.

Badham-Thornhill also recommends that you review your will after any life changing event, given the implications this may have on your estate, for example, getting married, purchasing a house or other asset, having a child, experiencing a death in the family, or inheriting. In particular, Badham-Thornhill says that having a child will impact how your estate is managed, because of the strict rules in place to ensure that children are cared for in your absence. “A will can simplify this process and ensure that your child is looked after immediately, without having to overcome any administrative barriers first,” she says.

To read the full article click here: http://www.hippo.co.za/blog/insurance/write-a-will-protect-your-legacy/

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Fairbridges Wertheim Becker: Terralex's exclusive South African Member Firm

TerraLex is one of the world’s leading international legal networks. With more than 155 top independent law firms and more than 17,000 attorneys in 100 countries, TerraLex members provide the legal resources and expertise needed to conduct seamless business worldwide.

Membership is by invitation only and requires a careful review process. Terralex members are well recognised and respected in their local jurisdictions as well as internationally.

Members represent clients effectively because of their knowledge of local law and business customs and their expertise and experience in the practice of law, especially in the context of transnational transactions and dispute resolution. TerraLex members collaborate seamlessly with colleagues from other jurisdictions regardless of differences in legal systems and cultures.

TerraLex provides its members with opportunities to develop close personal relationships with one another and to acquire an understanding of each other’s business and legal environments. These relationships are the key to providing responsive, quality service. No matter what the issue or where in the world a challenge presents itself, TerraLex members provide prompt, responsive, and highly competent service seamlessly. Terralex’s Mission is to help member firms serve their clients’ legal needs and business interests by developing close working relationships within a worldwide network of quality law firms that meet high professional standards.

As the exclusive South African member of Terralex since 1999, Fairbridges Wertheim Becker is uniquely positioned to engage this global network of independent and trusted legal practitioners for the benefit of our clients.

For more info go to http://www.terralex.org/.

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SARS Tax Clearance Certificates

A new tax clearance system is to be rolled out by SARS. This new system is said to improve efficiency and assist both the taxpayer and third parties to check the compliance status of the taxpayer. The taxpayer will no longer need to attend at a SARS Branch to collect tax clearance certificates, and this should ease up the queues! This should greatly assist both Conveyancers and Estates Attorneys, who require tax clearance certificates for almost all their matters.

What happens if the system identifies you as non-compliant? You will be able to review where you have defaulted, because the online system will provide the taxpayer with an audit trail for all tax types.

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The battle between Apple and Samsung continues

Apple initially claimed that Samsung had infringed eight of its software patents (for example, the ‘slide-to-unlock’ feature) and claimed US$2.2 billion in damages. Apple was awarded US$120 million to be paid by Samsung in lieu of damages but in February this year the US Circuit Court of Appeals overturned the ruling stating that Samsung need not pay any infringement damages nor alter any of its designs.

As a result, Apple has argued that the court violated its Seventh Amendment of the US Constitution right to trial by a jury due to the fact that the appeal court considered new evidence, which was not introduced as evidence in the original case and facts that were put before a jury.

Accordingly, the battle between Apple and Samsung continues. The case may end up in the US Supreme Court.

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Raising a workplace dispute at the CCMA

If you have been unfairly suspended or dismissed; are in a dispute with your employer over working conditions, wages, workplace changes; or have experienced discrimination, sexual harassment or violence at the workplace, you may approach the Commission for Conciliation, Mediation and Arbitration (CCMA). The CCMA is an independent dispute resolution body established in terms of the Labour Relations Act (LRA).

If the dispute concerns an unfair dismissal, you must approach the CCMA within 30 days from when the dispute arose. If the dispute concerns an unfair labour practice or discrimination, however, you have 90 days and 6 months respectively to lodge the dispute. You do not need the other party’s consent before bringing the matter to the CCMA and no lawyers are required. A union or employers’ organisation may also initiate this action.

In order to lodge a dispute, you need to complete a case referral form (LRA Form 7.11). These forms are available from the CCMA offices, Department of Labour and the CCMA website (click on the link below). A copy of the completed form must be delivered to the other party by fax, registered mail, courier or in person. A copy must also be delivered to the CCMA with the other party’s proof of receipt. The CCMA will then contact the parties and inform them of the date, time and venue of the hearing.

The first meeting is usually conciliation where the parties are led by a Commissioner in an attempt to settle the matter. No legal representation is allowed at this stage. If the parties are unable to reach an agreement, the matter will go to mediation where the Commissioner plays a more active role in trying to resolve the dispute.

If the parties are still unable to resolve the dispute, the matter may be referred to the CCMA for arbitration. Arbitration proceedings are more formal and parties are allowed legal representation. Evidence is also permitted and the parties and witnesses may be cross-examined. The Commissioner will make a final and binding decision, called an arbitration award, within 14 days after the date of the hearing. If a party does not comply with the arbitration award, it may be made an order of the Labour Court.

Please note that disputes involving independent contractors, disputes where a bargaining or statutory council exists for that sector, disputes where a private agreement exists for their resolution (e.g. private arbitration) and cases that do not deal with an issue in the LRA or Employment Equity Act cannot be referred to the CCMA.

For more information on the CCMA, click here http://www.ccma.org.za

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Prescription: use it or lose it

Prescription is the process by which legal rights are lost as a result of a failure to take action over a period of time. Prescription is regulated primarily by the Prescription Act 68 of 1969 [http://www.saflii.org/za/legis/hist_act/pa68o1969190/pa68o1969a7a1992310.html].

It is generally accepted that the purpose of prescription is to provide certainty, especially in the case of debtors, and to encourage members of the public to actively pursue debts rightfully owed.

The Act provides that “a debt shall be extinguished after prescription of the relevant period”. Prescription, therefore, can be pleaded in any action by the Defendant but a court cannot on its own accord raise prescription as a defence.

The periods of prescription of debts are:

thirty years in respect of

Any debt secured by a mortgage bond;
any judgment debt
any debt in respect of any taxation;
any debt owed to the state in respect of mining;

fifteen years in respect of any debt owed to the state on a loan or sale or lease of land, unless a longer period  applies;
six years in respect of a debt arising out of a negotiable instrument or notarial contract unless a longer period applies;
three years in respect of any other debt unless specifically provided otherwise by statute.

Prescription begins running as soon as the debt is due unless the debtor wilfully prevents the creditor from knowing of the existence of the debt, in which case it commences to run when the creditor becomes aware of its existence.  There are a number of ways in which prescription can be interrupted but primarily, if there is an express or tacit acknowledgement of existing liability made by the debtor to the creditor or if the debtor is served with a summons, prescription will be interrupted.

To find out more about prescription and its application, in particular with regards to when prescription begins to run, see the recent case FNB & Naude v Scenematic One (Pty) Ltd which concerns the defence of prescription raised in relation to claims arising out of unauthorised debit orders.

The case is available here: http://www.saflii.org/za/cases/ZASCA/2016/60.html.

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Fairbridges Wertheim Becker at the University of the Western Cape Career Fair

Fairbridges Wertheim Becker was one of the law firms that attended the University of the Western Cape Career Fair on Tuesday 19 April. It was an exciting day speaking to law students about their studies, legal practice and working at Fairbridges Wertheim Becker. We wish you well for your studies and future legal careers.

The closing date for 2017 candidate attorney applications is 30 April 2016.

For more information about applying for articles at Fairbridges Wertheim Becker please see: http://www.fwbattorneys.co.za/candidate-attorneys/

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Landlord’s tacit hypothec – what it means for lessees and their goods

The landlord’s tacit hypothec is a form of real security recognised in South African law. The hypothec is “tacit” because it is understood or implied without being stated; in other words, the hypothec comes into effect by operation of law and not by agreement between the Landlord and Tenant.

 The hypothec secures the lessee’s obligation to pay the rent in terms of the agreement of lease. It does this by allowing the landlord to burden the movables present on the leased land or while in transit to a new destination subsequent to the removal from the land.

 What this means is that the Landlord is able to obtain a limited real right in the movable goods present on the property on the date that rent is in arrears. However, this right does not accrue to the Landlord automatically; it first needs to be perfected. In other words the landlord has to obtain an interdict restraining the removal or sale of the goods on the property pending an action for rent or an order for their attachment by the court.

Importantly, the hypothec does not apply to goods removed from the premises before the hypothec is perfected. In certain instances the movable goods belonging to third parties can also fall under the hypothec, but only to the extent that the movable goods belonging to the lessee are insufficient to satisfy the arrear rental. For this to happen the Lessor will have to show that the aware and consented to the presence of the goods on the premises, that the landlord was unaware that they belonged to a third party and that the goods were bought onto the premises for permanent use by the lessee. 

 

 

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Personal liability of directors under Companies Act

The Western Cape High Court recently confirmed that a director of a company may, in terms of the new Companies Act, be held personally liable for damages sustained by a third party creditor where the director in question acted in such a way so as to acquiesce in the carrying on of the company’s business despite knowing that it was being conducted in a reckless manner, with gross negligence, with intent to defraud any person, or for any fraudulent purpose. The statutory clause in question is not limited in its applicability, as contended by the directors in the case, to a claim by the Company against its directors. The Court confirmed that section 77(3)(b) of the Act can be the basis to found personal liability of a director in favour of a creditor of a company.

Blue Farm Fashion Limited v Rapitrade 6 (Pty) Ltd and Others (22288/2014) [2016] ZAWCHC 35 (1 April 2016)

Click here to read the judgment: http://www.saflii.org/za/cases/ZAWCHC/2016/35.html

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Adcock Ingram vs Actor Holdings- Don't Delay

The Trade Marks Act makes provision for a trade mark application to be examined and thereafter advertised provided it is accepted by the Trade Mark Registrar to afford interested third parties the opportunity to oppose registration. The opposition period is three months from the date of advertisement and an extension of three months is available on request. A further extension by agreement between the parties is also available.

In the case of Adcock Ingram Intellectual Property (Pty) Ltd & Adcock Ingram Healthcare (Pty) Ltd (the Opponents) v Actor Holdings (Pty) Ltd (the Trade Mark Applicant), the first Court hearing the litigation found that the Opponents were not entitled to apply for condonation (forgiveness, in laymans terms) for the late opposition to the registration of the LENTOGESIC trade mark in class 5 filed by the Trade Mark Applicant. The important question was whether the Act and its Regulations give the Registrar a discretion to extend the opposition period before or after the expiration of the related time limits.  The Court ruled that once the time limit has expired it cannot be extended.

On appeal, the Supreme Court found that that “the Court a quo committed a cardinal error, which led to its misinterpretation of the Registrar’s powers, by impermissibly using regulations (which it incidentally also misconstrued), in particular regulation 52, as an aid to interpret the provisions of the Act”. Furthermore, “the Act vests the Registrar with ‘all such powers and jurisdiction as are possessed by a single judge in a civil action’ in connection with any proceedings before her. She is obviously enjoined to exercise her discretion lawfully in considering an extension application”.

Accordingly, the Supreme Court of Appeal has confirmed that the Trade Marks Act empowers the Registrar of Trade Marks to condone the late filing of opposition to an application for the registration of a trade mark and extend the three month period prescribed for the filing of opposition.

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The effect of the in duplum rule once judgment has been granted

In terms of the common law in duplum rule, interest stops running when ‘unpaid’ or ‘arrear’ interest equals the outstanding capital amount. This prevents unpaid interest from exceeding the unpaid capital sum.

The parameters of the in duplum recieved some panel beating in the case of Paulsen v Slip Knot Investments 777 (Pty) Ltd before the Constitutional Court in 2015. The Court clarified that the rule should apply during the litigation process, which means that outstanding arrear interest is not permitted to run during the course of litigation once interest and the capital debt reach parity.

In the past there has been some uncertainty regarding the amount on which the interest on a judgment debt should be calculated: Is it (1) the capital amount originally incurred (the principal debt) and costs awarded in terms of the judgment, or (2) on the full amount that the judgment was granted for (capital amount plus accrued interest before judgment).

The Court provided clarity. It noted that the interest runs on and is limited to an amount equal to the whole of the judgment debt, including the portion which consists of previously accrued interest. Post-judgment interest runs at the rate agreed upon contractually.

So what does this mean? The effect of the in duplum rule after judgment is that a creditor is entitled to the following:

Repayment of the unpaid capital sum;
Interest on the unpaid capital sum at the contract rate up to an amount equal to the unpaid capital sum;
Interest on the total of the amounts in (1) and (2), at the contract rate from the date of judgment of the court to date of payment by the debtor.

Read the judgment here: http://www.saflii.org/za/cases/ZACC/2015/5.html

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Immigration Law Amendments

The Immigration Amendment Bill was recently tabled in Parliament by the National Assembly’s Home Affairs Committee.

 

The proposed amendments address the issue of foreigners who have illegally overstayed their welcome, by preventing them from being granted permanent residence or any other entry visa for as long as deemed appropriate.

 

Section 32 of the Immigration Act 13 of 2002 read with the Regulations provides that those illegal foreigners who have neither been arrested for deportation, nor ordered to depart and who wish to apply for a visa or permit after expiry, the opportunity to apply for authorisation by the Director-General, that they remain in South Africa pending the outcome of their visa application.               

 

The amendments proposed and tabled will prevent any illegal foreigners who have overstayed their welcome from making an application for authorisation as described above in South Africa. The illegal foreigners, having overstayed their welcome, will not qualify for any visa or permanent residence permit, and may only apply from outside of South Africa: firstly for a waiver of such disqualification (only in exceptional circumstances, which are to be prescribed), and secondly for the required visa or permit. The Regulations will need to be amended to bring them in line with the proposed amended and prescribe these ‘exceptional circumstances’.

 

The Memorandum of Objects of this Bill records that “the administrative fines imposed were no longer serving as a deterrent”, which led to the introduction of Section 30 and the declaration of foreigners who overstayed their welcome, as undesirable. But due to the “interpretation challenges” of this section, it is proposed that the sanctions imposed under Section 50 by declaring a foreigner who leaves South Africa as “undesirable”, should instead be dealt with in terms of this new section 32(1A).

 

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Simba Remains King of Flavour

In one of the Advertising Standards Authority’s (“ASA”) latest cases, Simba (Pty) Ltd v Gatbro International Manufacturing (Pty) Ltd (25 January 2016), the Simba potato chip brand took on a so-called copycat potato chip brand known as Krunch.

The issue arose when Simba became aware of its competitor’s packaging consisting of a yellow crown device above the name ‘Krunch’ and the use of the slogan “The King of Flavour”. Simba’s packaging also includes a crown device above its name and has the slogans “King of Snacks and “Roarrs with Flavour”.

Simba’s complaint to the ASA was that the Krunch packaging contravened clause 8 of the ASA Code, in that it involved an exploitation of its advertising goodwill, as well as clause 9, in that it comprised an imitation of an advertisement. Simba also argued that the slogan “The King of Flavour” was misleading and unsubstantiated as it wrongly implied that its product had the best flavour, which it could not prove.

The ASA held that Krunch had failed to prove that the image of a crown and Simba’s slogans were not Simba’s original intellectual thought. Accordingly, it concluded that “the adoption and execution of the crown together with the reference to a ‘King’ of flavour cannot be regarded as coincidence and it is reasonable for the (ASA) to infer a conscious decision to copy, especially in the absence of a reasonable explanation as to why the respondent adopted this particular get-up.”

In light of this ruling it is clear that trade mark owners can continue to successfully use the ASA as a forum for dealing with trade mark disputes.

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Terrelex member firm now offering advice on family law matters

An Australian based firm Lander & Rogers has added family law to its Sydney offering to meet growing numbers of referrals and enquiries from clients. The practice launched earlier this month under the direction of the firm’s family and relationship co-heads Craig Henderson and Mark Parker, both based in Melbourne.

Sydney is well known for is large population of expats. For this group – both immigrants in Australia and Australians living overseas – disputes frequently arise around children, often involving complex financial issues with assets in multiple jurisdictions. Resolving those matters requires a deep understanding of the law relating to the appropriate forum for such disputes and the practical issues involved in procuring information from outside Australia.

Lander & Rogers is the Australian member of the international association of independent law firms, TerraLex, and partners with other member firms to work with clients over international disputes.

As the exclusive South African member of Terralex, Fairbridges Wertheim Becker has direct access to a global network of independent leading legal practitioners such as Lander & Rogers, the benefits of which are passed directly onto our clients.

See full article at: http://www.lawyersweekly.com.au/news/18205-rising-demand-for-family-law-prompts-sydney-practice-launch

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Employers must ensure that the agreed retirement age of their employees is certain

According to the Labour Relations Act, a dismissal based on age will not be automatically unfair if an employee has reached the “normal or agreed retirement age for persons employed in that capacity”. Therefore, if an employee has reached either one of those ages, an employer would have a defence to a claim of dismissal based on age discrimination.

In the recent judgment of Harris v Ocean Traders International (Pty) Ltd, the Labour Court had to determine whether the applicant had been automatically unfairly dismissed by his employer, the respondent in the matter. The applicant had been required to retire when he turned 63 years of age, despite being under the impression that his agreed retirement age was 65. The applicant was aware that the company’s retirement policy had changed during his period of employment but he had never agreed to accept the changes.

The Court decided that since the applicant had refused to sign the contract altering the retirement age and the respondent did not pursue the issue, the understanding between the applicant and the respondent was that he would retire at age 65. The Court concluded that the applicant’s dismissal based on his age constituted an automatically unfair dismissal in terms of the Act and he was awarded 16 months’ remuneration as compensation.

This matter emphasizes the importance of employers ensuring that there is certainty regarding an employee’s agreed or normal retirement age.

Please note that in this matter, the applicant was not a member of an occupational pension plan. If an occupational pension plan is provided for, then the fund rules relating to retirement age would also be taken into account.

Click here to read the judgment: http://www.saflii.org/za/cases/ZALCJHB/2016/63.html

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Kenyan-South African Dialogue on Devolution - Reviewed by Louis Rood

The South African Constitution of 1996 is the foundation of our entire

legal system and has proved itself to be truly resilient, inspirational and

principled. It may have been crafted from compromise, but that was the

reality of the political, historic, cultural and economic landscape on

which forge this remarkable legislative bulwark was hammered out.

 

One of the prime characteristics of the South African Constitution is the

decentralisation of powers and functions from the national level to

provincial and municipal levels.

 

In August 2010, Kenya adopted its new Constitution, which came fully

into effect in March 2013. It also adopted a system of decentralisation,

referred to as devolution, and established 47 counties.

 

The Kenyan Constitution largely copied the structure, approach and

principles of provincial and local government from South Africa. This

book is the first to provide an in-depth comparative assessment of the

Kenyan and South African systems of devolution. It contains fascinating

and insightful South African and Kenyan chapters by a team of experts.

They deal with the reasons for devolution, the levels, numbers, size and

character of devolution units, their demarcation, political structures,

powers and functions, finances, metropolitan governance,

intergovernmental relations, marginalised groups and transitional

arrangements.

 

This comprehensive overview at an evolving stage for both Kenya and

South Africa will be of considerable value to many African and other

countries contemplating or in a stage of devolution seeking to curb the

abuse of centralised power and to promote political stability and

development in a democratic state. It is also a timely review for all South

African legislators, lawyers, administrators and those who interact with

the three tiers of government, of the success or otherwise of devolution

over the past 20 years in the light of its aims and application.

 

Publishers Juta are to commended for producing this unique work under

the guiding hands of the co-editors, Professor Nico Steytler BA LLB

LLM PhD who is the South African Research Chair in Multilevel

Government, Law and Policy at the Dullah Omar Institute of

Constitutional Law, Governance and Human Rights at the University of

the Western Cape, and Yash Pal Ghai, who has degrees, including a

Doctorate of Civil Law, from Oxford and Harvard Universities, and is a

Director of the Katiba Institute in Nairobi, Kenya.

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Law of Succession - Reviewed by Louis Rood

The law of succession regulates a substantial portion of life’s two

certainties – death and taxation. Its rules control the winding up and

distribution by inheritance of any assets in a deceased estate remaining

after outstanding debts, including taxes and administrative costs, have

been met.

 

This fifth edition of a book which first appeared in 1992 provides a

comprehensive overview of all aspects of the law of succession. Also

available in Afrikaans as Erfreg, it will continue to be an invaluable

resource for legal practitioners, executors and administrators of

deceased estates, trustees, guardians, curators, tax and financial

advisors, estate planners, students and Masters office officials.

 

Every aspect of the subject is dealt with clearly and logically, with

pertinent footnotes, case references, a detailed table of the relevant

sections of legislation and regulations, extracts from certain acts such

as the Wills Act of 1953 and the Intestate Succession Act of 1987, and

an extensive bibliography, all fully indexed.

 

The experience and expertise of the distinguished co-authors, both

acknowledged senior scholars in this branch of the law, ensures that the

text and contents are accessible and the style lucid and concise.

 

This resource is exceptionally well-organised and reader-friendly, while

maintaining the intellectual and academic quality and insight required for

a complex branch of private law.

 

The co-authors are Professor MJ de Waal BComm LLB LLM LLD of

Stellenbosch University, and Professor MC Schoeman-Malan BA LLB

LLD of the University of Pretoria. They point out that the law of

succession should always be studied within its broader social context. It

can only function successfully in a system that recognises the right to

private property. The law of succession thus fulfils an important

economic function as it regulates the transfer of wealth upon a person’s

death. It also fulfils a social function, particularly in maintaining and

protecting the family as a social unit.

 

The law of succession has, not surprisingly, enjoyed the frequent

attention of our legislators and courts and has its origins in ancient

times. It has also seen the considered input and commentary of some of

our finest scholars and jurors, such as former Chief Justice Michael

Corbett (The Law of Succession in South Africa, Juta 1980). The

present book handsomely meets the ongoing need for guidance and a

sure grasp of this fundamental pillar of our legal firmament.

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Introduction to the Law of Property (Seventh Edition)- Reviewed by Louis Rood

This is the seventh updated edition of a book which serves as a base

template for the law of property, and is a key cornerstone to Juta’s

Property Law Library series which is aimed at covering all aspects of

South African Property Law.

 

All aspects of ownership, possession and other rights in property are

dealt with. The basic concepts and principles of the acquisition, use,

protection and termination of ownership are explained. The interplay

between the common law, the constitution and legal reform in a

constitutional system is illustrated and there is an interesting

consideration of the future of property law.

The text is comprehensively indexed for quick and easy reference and

relevant cases are listed and linked to the text.

 

The co-authors Professor André van der Walt B Juris Hons (BA) LLB

LLD LLM of Stellenbosch University and Professor Gerrit Pienaar B Jur

et Com LLB LLD of Northwest University have previously amply

demonstrated their masterful grasp of the subject in other volumes in

this series – Professor Pienaar: Sectional Titles and other Fragmented

Property Schemes, and Professor van der Walt: The Law of

Neighbours, Constitutional Property Law, Law of Property Casebook for

Students – and are to be commended together with publishers Juta,

for this further excellent contribution to a vital area of our law which is

increasingly important as a critical aspect of the economy, political

terrain, cultural expression and the environment.

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Amendments to the Labour Relations Act and what it means for fixed term contracts

As at 1 March 2015 certain amendments to the Labour Relations Act came into operation. One of the main amendments with far-reaching consequences for employers and employees alike is the change to laws governing fixed term contracts. Where the amendment is applicable to the parties (as there are exceptions) section 198B limits the instances when employers and employees can enter into fixed term contracts. Furthermore, the amendment attempts to create greater equality between employees on fixed term contracts and their counterparts with permanent contracts.

 For an employer to use a fixed term contract it will have to prove that the nature of the job is of a limited or definite period, or show any other justifiable reason why the term of the contract is limited.

 

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If you are conducting a promotional competition, make sure it complies with the CPA

If you are conducting a competition that falls within the meaning of “promotional competition” as defined by the Consumer Protection Act (CPA), you need to ensure that it complies with s 36 of the CPA and its Regulations.

The CPA describes promotional competitions as any competition, game, scheme, arrangement, system, plan or device for distributing prizes by lot or chance if it is conducted in the ordinary course of business for the purpose of promoting a producer, distributor, supplier, or association of any persons, or the sale of any goods or service.

Unlike the previous legal position under the Lotteries Act, participants in a promotional competition are no longer required to demonstrate any skill or ability before being awarded a prize. A prize may include a reward, gift, free good or service, price reduction or concession, enhancement of quantity of quality of goods or services, or other discounted or free thing. Competition promoters may not require participants to pay any consideration for entering the competition, other than the reasonable costs of posting or entering the competition via SMS. SMS entries are limited to a cost of R1.50.

If a competition does not comply with the CPA, it may be declared void and be investigated by the National Consumer Commission. It is therefore important that competition promoters familiarise themselves with the provisions of the CPA and its Regulations before conducting a promotional competition.

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Draft King IV Report

The draft King IV Report on Corporate Governance for South Africa 2016 has been published by the Institute of Directors of Southern Africa and is now open for public comment until 15 May 2016. All comments are to be submitted via its online platform.

The Institute of Directors of Southern Africa expects to officially launch the King IV Report on 1 November 2016.

To review draft and submit comments  go to – http://www.iodsa.co.za/page/KingIVcommentary

 

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Prescribed rate of interest (legal interest) has increased from 9% to 10.25%

The prescribed rate of interest has increased from 9% to 10.25%, 0.25% below the Prime Lending Rate, in terms of the Prescribed Rate of Interest Act. This interest rate, determined by the Minister and published in the Government Gazette, will apply where a debt bears interest, and that rate has not been agreed or is not subject to any other law.

 

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Three TerraLex Member Firms Collaborate on Multi-Jurisdictional Transaction in Aviation Sector

TerraLex Member Firms RPC in England, Holland & Hart in Nevada and Colorado, and SKW Schwarz in Frankfurt and Munich have successfully acted for Sierra Nevada Corporation (SNC) on its acquisition of 328 Group Limited (328) and its subsidiary entities located in Germany.

The team advised SNC on aspects of the cross-border deal specific to their jurisdictions. 328 is an aerospace company that owns the type certificate and intellectual property (IP) rights for design, manufacture, maintenance and certification of the Dornier 328 (D328) prop and jet aircraft.

As the exclusive South African member of Terralex, Fairbridges Wertheim Becker is in the unique and privileged position to have to have access to a global network of independent and recognised legal practitioners such as those mentioned above.

To find out more about Terralex click here www.terralex.org

See more here: http://www.terralex.org/publication/p961ab3f104/three-terralex-member-firms-collaborate-on-multi-jurisdictional-transaction-in-aviation-sector

 

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Wishing Tony Hardy a well-deserved retirement after 56 years at FWB

We bid farewell to Tony Hardy, a consultant at Fairbridges Wertheim Becker, in the Cape Town Office, who is to retire after 56 years at our firm.

“Tony served with distinction as President of the Cape Law Society and as President of the Association of Law Societies of South Africa (effectively the leader of the attorneys’ profession). He also showed his academic ability by obtaining his Masters degree at UCT in Tax Law 30 years after commencing practice. As head of our Commercial department for many years, involved in countless complex transactions for both domestic and foreign clients, he has long been recognised as one of South Africa’s top corporate, tax and commercial lawyers. He was also our senior partner and chairman for well over a decade and an outstanding leader.  He is ensured that he is enshrined in the annals of the firm’s history.”

– Richard Cheeseman, Managing Director

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Jayson Jude Rebelo appointed to the board of FWB

We are pleased to announce that Jayson Rebelo has recently been appointed as a Director at Fairbridges Wertheim Becker.

Jayson specialises in administrative law, civil litigation, dispute resolution and commercial drafting. He has extensive experience in civil litigation having been involved in matters in the Constitutional Court, the High Court as well as the Regional and District Magistrates’ Courts.

Jayson has obtained both a Bachelor of Commerce (Bcom) and Bachelor of Laws (LLB) from the University of Witwatersrand and was admitted as an attorney in 2012.

To read more about Jayson, click here [http://www.fwbattorneys.co.za/attorneys/jayson-rebelo/]

For other practitioners click here [http://www.fwbattorneys.co.za/our-attorneys/]

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FWB at the University of the Western Cape Career Fair

Fairbridges Wertheim Becker will be at the University of the Western Cape Career Fair on Tuesday 19 April. We look forward to chatting to you about your legal studies, life as a lawyer and working at Fairbridges Wertheim Becker.

Please note that the closing date for 2017 candidate attorney applications is 30 April 2016.

For more information about applying for articles at Fairbridges Wertheim Becker please see: http://www.fwbattorneys.co.za/candidate-attorneys/

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Minion Yellow

The Pantone Colour Institute has created a new colour called ‘Minion Yellow’ meant to show “hope, joy and optimism” inspired by the little yellow creatures featured in the “Despicable Me” movie franchise. Colours, identified by the allocated Pantone number, have formed some of the world’s most recognisable trade marks, for example the Coke red or the Christian Louboutin unique red soles of their shoes. If they are registered as a trade mark the trade mark owner will have the exclusive right to use that shade of colour in relation to the registered goods/services to the exclusion of others.

In South Africa, colours have only been registrable since 1995 and the Trade Marks Act of 1993 now defines a “mark” to mean “any sign capable of being represented graphically, including a device, name, signature, word, letter, numeral, shape, configuration, pattern, ornamentation, colour or container for goods or any combination of the aforementioned.”

It may come as a surprise that it is not easy to be granted a colour trade mark. In the matter before the Trade Mark Registrar of Trade Marks in 2004, Cadbury Ltd vs Beacon Sweets and Chocolates(Pty) Ltd, the Registrar ruled on a trade mark application consisting exclusively of colour.  Cadbury had applied for the registration of the colour purple in respect of chocolate confectioneries and described the mark as consisting of the colour purple as shown in the representation attached to the application, which was a purple square block. The application was later amended by specifying the purple colour by its international Pantone code.  However, the Registrar held that “unless a single colour is unusual in relation to the goods or services in respect of which it is proposed to use the mark, it is submitted that such a single colour is not inherently capable of distinguishing.  Consumers are not accustomed to making an assumption about the origin of goods on the basis of the colour of the packaging in the absence of either a graphical or textural element, because a colour per se is not normally used as a means of identification in practice.”  Essentially, if not distinct the colour will not constitute a registrable trade mark and the Registrar found the colour mark in this instance too vague to be identifiable as a mark.

It remains to be seen whether ‘Minion Yellow’ will be trade marked by Universal Studios and what the outcome will be if they attempt to do so.

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Johann van Eeden appointed to the board of FWB

We are pleased to announce that Johann van Eeden has been appointed as a Director at Fairbridges Wertheim Becker. Johann has experience in a wide range of commercial and matrimonial matters, including litigation in the Supreme Court of Appeal, High Court, Regional and Magistrates Courts. Johann holds the degree of LLB from the University of Pretoria and was admitted as an attorney in March 2014.

To read more about Johann, click here [http://www.fwbattorneys.co.za/attorneys/johan-van-eeden/]

For other practitioners click here [http://www.fwbattorneys.co.za/our-attorneys/]

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Blair Wassman appointed as Senior Associate at FWB

We are pleased to announce that Blair Wassman has been appointed as a Senior Associate at Fairbridges Wertheim Becker. Blair specialises in employment law and litigation. She has conducted and been directly involved in a wide range of commercial matters and litigation in the Constitutional Court, High Court, Regional and Magistrates Courts, as well as labour law and employment proceedings.

Blair holds the degrees of BA, LLB and an LLM in Commercial Law (with speciality in Labour, Corporate Finance; Corporate Insolvency; and Business Rescue) from the University of Johannesburg. She was admitted as an attorney and notary in 2014.

To read more about Blair, click here [http://www.fwbattorneys.co.za/attorneys/blair-wassman/]

For other practitioners click here [http://www.fwbattorneys.co.za/our-attorneys/]

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Greer Penzhorn appointed to the board of FWB

We are pleased to announce that Greer Penzhorn has been appointed as a Director at Fairbridges Wertheim Becker. Greer specialises in litigation, with extensive experience in commercial litigation in the Supreme Court of Appeal, High Court, Regional and Magistrates courts, particularly relating to contractual and building disputes and insolvency.

Greer holds the degrees of BComm, LLB from the University of Stellenbosch. She was admitted as an attorney in 2010 with right of appearance in the High Court.

To read more about Greer, click here http://www.fwbattorneys.co.za/attorneys/greer-penzhorn/

For other practitioners click here [http://www.fwbattorneys.co.za/our-attorneys/]

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FWB at the University of Stellenbosch Career Fair

Fairbridges Wertheim Becker attended the University of Stellenbosch’s annual Career Fair on Wednesday 24 February. It was an exciting day engaging with bright young minds, passionate about the law and the future! We wish them well for their studies and future legal careers.

The closing date for 2017 candidate attorney applications is 30 April 2016.

For more information about applying for articles at Fairbridges Wertheim Becker please see: http://www.fwbattorneys.co.za/candidate-attorneys/

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Julia Penn appointed to the board of FWB

We are pleased to announce that Julia Penn has recently been appointed as one of four new Directors of Fairbridges Wertheim Becker. Julia specialises in medical law, administrative law and commercial litigation. She has extensive experience in civil litigation having run matters in the Supreme Court of Appeal, the High Court as well as the Regional and District Magistrates’ Courts.

Julia holds the degrees of BA, LLB from the University of Cape Town, a Certificate in Medical Law from the University of Pretoria and an LLM in Medical Law and Ethics from the University of Edinburgh in Scotland. She was admitted as an attorney in 2010 with right of appearance in the High Court.

The profiles of Greer Penzhorn, Jayson Rebelo and Johann van Eeden who join Julia on the board to follow shortly.

To read more about Julia, click here [http://www.fwbattorneys.co.za/attorneys/julia-penn/]

For other practitioners click here [http://www.fwbattorneys.co.za/our-attorneys/]

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Domain names, trade marks and dispute resolution

A domain name is a unique name that identifies a website and is allocated on a first-come first-served basis. Generally a business owner will use the domain name to identify its goods or services and will incorporate its trade mark in the domain name. However, because the domain name registration process is on a first-come first-served system, a situation that often arises is where your chosen domain name has already been taken despite you having incorporated the trade mark.

If faced with this dilemma you generally have three options available to you: either you can attempt to purchase the domain name, pursue civil litigation for trade mark infringement (if you have a registered trade mark and you are dealing with a South African based domain name) or you can engage in the South African Alternative Dispute Resolution (“ADR”). Litigation is often lengthy and prohibitively expensive and if the owner of the domain name is not willing to sell the domain name you are left with the option of lodging a complaint the .co.za domain with the ADR. The ADR proceedings follow international norms.  In order to succeed in an objection, you need to prove three things:

that you have rights to a name;
that the domain name is identical or similar to your name; and
that the domain name is “abusive” in the hands of the registrant.

To be declared to be an abusive registration, the domain name must have been registered in a way that took unfair advantage of, or was unfairly detrimental to, the complainant’s rights. If so, the domain name will be transferred to the complainant. Unlike court litigation which can take months, this is a resolution that can be reached relatively swiftly.

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Western Cape High Court affirms courts' strong approach against sellers fraudulently concealing latent defects from buyers, despite 'voetstoots' clause

A ‘voetstoots’ clause is a clause which one would usually find in terms and conditions of trade, or purchase and sale agreements, in which the seller contracts out of liability for patent and latent defects. Unlike a patent defect, a defect is latent if it is not visible or discoverable upon reasonable inspection. Although a voetstoots clause provides the seller with a defence should a patent or latent defect later be discovered by the buyer; the seller may not act fraudulently. A seller acts fraudulently when aware that a latent defect exists, and deliberately refrains from informing the buyer. Should a seller knowingly fail to disclose any material latent defect, a buyer may be entitled to  cancel the sale, claim repayment of the purchase price or claim a reduction of the purchase price, depending on the nature and extent of the defect. If the seller genuinely did not know about the latent defect, however, the seller will not be held liable.

The Western Cape High Court recently affirmed that if a contract of sale contains a voetstoots clause and the seller fraudulently conceals knowledge of a latent defect from the buyer, the buyer will be entitled to appropriate relief. In the particular case, the seller laid cement screed over wooden floors and covered them with carpets and tiles in order to deliberately hide the unevenness from the buyer.

Sellers must be aware that they will be held accountable for failing to disclose knowledge of a latent defect, even if the contract of sale contains a voetstoots clause. Buyers must therefore show the necessary due diligence when entering into a contract of sale and at the time of purchase.

Read the judgment here: http://www.saflii.org/za/cases/ZAWCHC/2015/145.html

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Gordhan's Budget Speech: 24 February 2016 at 14h00

On 24 February, at 2pm, Finance Minister, Pravin Gordhan will deliver the Budget for the 2016 financial tax year. With a number of tough choices to make, there is great anticipation in hearing what steps will be taken to avoid credit rating downgrades.

Some speculation includes potentially increasing Securities Transfer Tax rate from 0.25% to 0.5%, alternatively to increase the VAT rate from 14% to 17%. Cuts to government expenditure are expected and we have been warned of the potential for an increase in personal income tax.

Minister Gordhan has asked for South Africa’s views on this years’ budget, and how South Africa can achieve economic growth.

Want to send your tips to our Finance Minister? – go to http://www.fin24.com/Budget/budget-2016-gordhan-wants-to-hear-sas-views-20160209

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May one insure the life of another without their consent?

At present, there is no legal requirement that a person being insured consent to a policy being taken out on his or her life. A contract of insurance may operate on the life of another, provided that the policyholder has an ‘insurable interest’ in the life of that person.  Neither the Long Term Insurance Act nor its Regulations, however, deal with the issue of consent. This means that a person may insure the life of another, for vast amounts of money, without that person being notified, provided that the policyholder can show that there is an insurable interest. This lacuna, however, does not prevent insurance providers from requiring the consent of the person whose life is insured in their life insurance policies.

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Attorney profile: Karol Michalowski

Karol Michalowski is an associate at Fairbridges Wertheim Becker in its Cape Town office. Karol was admitted as an attorney in 2013 and holds the degrees of BSc (Hons) (in Medical Biochemistry) and LLB from the University of Cape Town. Karol’s focus is commercial and civil litigation in the High Court, Regional Court and Magistrates Court, with a special interest in the law of contract, delict, insurance law and administrative law. Karol is also an extremely talented sportsman, with several major off and on road cycling races under his belt.

To read more about Karol click here [http://www.fwbattorneys.co.za/attorneys/karol-michalowski/ ] and here [http://www.fwbattorneys.co.za/our-attorneys/] for a full list of our professional staff.

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Employers' remedies – where to start?

The employment contract is an essential source of the employees, and the employer’s rights. Although employers have no remedies under the Employment Equity Act 55 of 1998 and Labour Relations Act 66 of 1995, an employer is still entitled to enforce its rights as they are written in the employment contract.  Where the employee has breached a term of its contract of employment, the employer may rely on the contract to protect it against such breach, such as insisting on key performance outcomes, and/or claiming damages. Your contracts of employment should govern the steps to be taken should a breach arise, and provide a resolution process, should a dispute arise between the parties in terms of the contract.  The Labour Appeal Court, in Rand Water v Stoop & another (2013) 34 ILJ 576, has confirmed that employers may sue ex-employees for damages arising from breaches of their contracts. The Labour Court and civil courts both have the jurisdiction to hear these disputes.

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Demotions and dismissals – they are not the same

(Moapese and others v HOD, Northern Cape Department of Education)

A reduction in salary does not constitute a dismissal, at best, it’s a demotion – according to the Education Relations Labour Council.

What happened was this: In 2007 the salaries of a group of employees were raised by a grade. In 2012, the new MEC ‘reversed’ the increase, as it had been, in his opinion, incorrectly escalated. As a result, the Employer reduced the salaries of the employees which administratively, manifested itself as a termination of employment on the C grade, to a re-appointment on the D grade. This ‘administrative termination’ coupled with the reduction, the employees contended, was a dismissal. The Commissioner indicated that in order for a dismissal to have occurred that the employees concerned would have had to have to ceased working. As the employees were still very much employed by the employer – albeit on a lower salary – no dismissal had occurred. In such circumstances the proper remedy sought from the CCMA or Bargaining Council would have been to have raised an unfair labour practice, alternatively, the employees could have gone on strike.

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AfrAfsia Bank Cape Wine Auction – "An Auction with a Cause, at the tip of Africa"

Since 2014, this auction has raised over 17 million rand for charity.

This year, on the 12th and 13th of February, at Klein Constantia, “forty coveted auction lots have been allocated, including wine collections from top wine estates in the Western Cape; business class tickets to Mauritius, Paris and the UK; and stays in London, Paris, and France”

Online bidding began on 15 January 2016 – to find out more, go to www.thecapeauction.com

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Reform of Community trade mark Regulations

The European Parliament implemented Regulation (EU) No. 2015/2424 amending the Community trade mark regulation on 15 December 2015, which will enter into force on 23 March 2016. Thereafter, the Office for Harmonisation of the Internal Market (OHIM) will be called the European Union Intellectual Property Office (EUIPO) and the Community trade mark will be called the European Union trade mark.

This reform also introduces various other amendments such as the reduction of renewal fees, the seizure of counterfeit goods in transit in the European Union, as well as a change in requirements for the filing of non-traditional trade marks, for example sounds and smells. An important change to take note of is in respect of trade mark class headings because provision has now been made for owners of Community trade marks filed between 1996 and 22 June 2012 which were registered for class headings to have a six-month period during which they can clarify the specific goods within the class for which protection is sought. No longer can a trademark claim protection for class headings and be considered to be protected for all the goods/services included in the alphabetical list of that class. The reform now requires applicants to be more clear and concise in as regards the goods/services for which protection is sought.

If you have a Community trade mark and are unsure whether this affects you contact our trade mark department who will be able to evaluate whether and how you need to proceed with the clarification of goods.

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Our former Cape Town candidate attorneys have been admitted as attorneys and appointed as Associates!

Congratulations to Daniel Hart, Palesa Mohale and Inge Surtie, who were admitted as attorneys of the High Court of South Africa, Western Cape Division, on 5 February 2016.

Daniel Hart and Palesa Mohale have been appointed as Associates in the Litigation department and Inge Surtie has been appointed as an Associate in the Conveyancing department at Fairbridges Wertheim Becker Attorneys (Cape Town office).

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Competition Commission recommends conditional approval of SABMiller Plc, Gutsche Family Investments (Pty) Ltd and The Coca Cola Company merger

The Competition Commission has recommended that the Competition Tribunal conditionally approves of the merger between SABMiller Plc, Gutsche Family Investments (Pty) Ltd and The Coca Cola Company. The merging parties plan to combine the bottling operations of their non-alcoholic beverages into one entity to be known as Coca-Cola Beverages South Africa (Pty) Ltd (‘CCBSA’), which will result in SABMiller transferring its Appletiser, Grapetiser, Fruitiser, Peartiser and Lecol brands to The Coca Cola Company.

The Commission’s investigation showed that the large merger would most likely lead to a number of competition and public interest concerns which would need to be properly addressed before any merger is to take place. Because the different bottling companies would fall under one entity, it is likely that the newly-formed entity would gain significant bargaining power over its suppliers. In order to make sure that the suppliers are not put in a weaker position to negotiate sustainable prices post-merger, the merging parties have agreed to purchase all tin cans, glass, plastic bottles, packaging, crates and sugar from local suppliers, subject to certain terms and conditions.

Unfortunately, a maximum of 250 employees may lose their jobs as a result of the merger. The parties have therefore undertaken to provide funding to re-skill affected employees, counselling and guidance on applying for alternative employment, and re-employment of some of the affected employees within the business of CCBSA.  The parties have also agreed to invest R500 million to develop the downstream distribution and retail aspects of CCBSA and to increase its B-BBEE ownership.

The Commission has emphasized that this proposed merger must not negatively affect businesses in the value chain that previously benefited from the existence of the individual bottlers in South Africa and that all competition and public interest concerns must be identified and addressed before any merger is to take place.

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TerraLex Connections - Special Edition – Cybersecurity

Fairbridges Wertheim Becker is the exclusive South African member of Terralex, a global network of independent law firms with leading member firms spread over 155 jurisdictions worldwide.

We are uniquely positioned to draw on this resource and to offer advice concerning foreign jurisdictions specific to our client’s requirements.

An official publication of the association, Terralex Connections, has released its first issue for 2016 with its focus on Cybersecurity. This issue has been canvassed in over 15 jurisdictions, including Australia, Belarus, Canada, China, England, Germany, Guatemala, India, Malaysia, Multi-jurisdictional, Romania, Scotland, Spain, Ukraine and the USA. All of these and more are available at http://www.terralex.org/.

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J&B Met this Saturday: Don’t miss it!

Tomorrow will see crowds returning to the Kenilworth Racecourse for the 39th annual J&B Met. The theme this year is “A Rare Blend” and it promises to be as spectacular as ever with R2.5m up for grabs in the feature race.

The two favourites for the title are Legal Eagle and Futura. Legal Eagle took home an impressive win in the L’Ormarins Queen’s Plate. Futura, who is rated only 0.50 lengths inferior to Legal Eagle, could only manage fifth as the favourite in the Queen’s Plate. But Legal Eagle’s trainer, Sean Tarry, remains cautious: “You can’t write Futura off on just one run.” Legal Eagle is 12-10 favourite to complete the fabled Queen’s Plate & Met double [http://tabnews.co.za/home/?p=45119].

Win or lose, at the end of the day the Met is more than just a horse race; it is a truly Capetonian celebration of culture and style.

For more information on the event click here  [https://www.jbscotch.co.za/home/]

 

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Tax Compliance during Secondments

Secondments are where an employer temporarily ‘loans’ its employee to another company, the host. The consensus is that the employee will go back to the employer after completion of its agreed term with the host. The host is generally in another country, which may give rise to tax consequences in the host country for both the employee and the host.

The employee, who is a non-resident to the host country, and who renders services in that country, will be liable to pay tax in that host country unless  –

there is a Double Taxation Agreement between the host country and the employee’s resident country;
the employee does not spend more than 183 days in the host country;
it can be shown that the host is not the employer; and
its actual employer does not have a permanent establishment in the host country, which is covering the costs of the employee in that host country.

Where South Africa is the host, and one of the above conditions are not met for the non-resident who is rendering services in South Africa, the South African host may be liable to account for the non-resident’s tax liability in South Africa.

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The Housing Consumers Protection Act- another a brick in the wall…

According to the Housing Consumers Protection Measures Act, builders are required to rectify ‘major structural defects’ that occur in houses that they have built within at least five years from the date that the housing consumer takes occupation, despite any agreement between the parties. A ‘major structural defect’ is a defect that affects the structural integrity of a house and is so severe that the house (or part of the house) has to be rebuilt or have extensive repair work done to it.

Similarly, builders are also required to rectify any deviation from the terms, plans and specifications of the agreement or any deficiency related to design, workmanship or material if the home owner notifies the builder at least three months from the occupation date. Any provision in a building agreement that excludes or waives the protection granted to housing consumers by the Act is prohibited and will be considered null and void.

If a housing consumer notifies the home builder and the complaint is not adequately addressed, the housing consumer may approach the National Home Builders Registration Council for compensation, provided that the defect occurred in a newly built house. This way, all housing consumers will be protected against poor workmanship.

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If you own the domain name will you also have the exclusive right to the name?

In the recent case of Fairhaven Country Estate (Pty) Ltd v Harris and Another 2015 (5) SA 540 (WCC) the Western Cape High Court decided that a domain name registrant does not have the exclusive right to the name.

The facts of the case were essentially that there was an estate agent and a property developer both interested in a residential property known as Fairhaven who started a business relationship with one another. Prior to this arrangement the estate agent had registered a few .co.za domain names incorporating the ‘Fairhaven’ name, such as fairhaven.co.za and fairhavencountryestate.co.za, in an attempt to help him secure the selling rights for the property development. Subsequently, the property developer incurred huge costs creating a website using one of the domain names in order to market the property, unbeknown to it that the domain name was registered in the name of the estate agent. After the relationship fell apart, the estate agent advised that he intended transferring his domain names into the name of a third party. This quickly prompted the property developer to seek a court interdict based on passing off, ordering the transfer of the domain names into its name as well as restraining the estate agent from registering further domain names containing the name ‘Fairhaven’. The property developer was granted the court order with costs.

The judge held that prior to the association between the estate agent and the property developer the domain names held no value. It was only after the property developer had created the website and spent a significant amount on marketing the property that the domain name had acquired value and such reputation was attributable to the property developer. Accordingly, the property developer had “clearly established an inextricable link between the domain names and its name”, being Fairhaven Country Estate (Pty) Ltd. He found that just because the estate agent had registered the domain names did not result in him having the exclusive right to use the domain names. The judge further ruled that although there had not as yet been a misrepresentation, there was “a clear intention that (the estate agent) intends passing off his business as being that of the applicant”.

Generally domain name disputes in South Africa regarding .co.za domain names are dealt with using the Alternative Dispute Resolution procedure established in terms of the Electronic Communications and Transmissions Act. This route is usually regarded as being more cost effective and quicker. However, as this case illustrates, one can also approach the courts in order to resolve such a matter.

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Fairbridges Wertheim Becker's David Short joins the Labour Court bench

David Short served on the bench of the Labour Court as an acting judge in the earlier part of January this year.

This is the second time David has been invited to act as a judge in the Labour Court, and he presided over various matters, including review applications.

David is a Director at Fairbridges Wertheim Becker. He has extensive experience and has assisted a wide range of corporate and other clients in all aspects of labour and employment law.  He regularly assists clients with the drafting of employment contracts, policies and procedures.  He has specialist expertise in strike handling and collective bargaining as well as with drafting and conducting urgent applications interdicting unlawful behavior in strikes.

David advises and assists clients before the Commission for Conciliation, Mediation and Arbitration (CCMA), Bargaining Councils and the Labour Court where he often appears personally. His specialist areas of practice include:-

All aspects of Employment Law and Litigation
Civil and Commercial Litigation
Education Law
Constitutional Law
Dispute Resolution
Pension Law

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The proposed Road Accident Benefit Scheme- the drive to a 'no fault' system

The Road Accident Fund was established in 1996 to provide compensation to all road users within South Africa who have been injured in motor vehicle accidents as a result of another’s negligent driving. The Fund compensates victims involved in motor vehicle accidents and also offers support to dependents whose providers have been injured or killed.

Unfortunately, claims against the RAF often take a long time to finalise, involve high administrative costs and costly litigation. The proposed changes to the RAF legislation seek to replace the RAF with a ‘Road Accident Benefit Scheme’ which aims to reduce the need for litigation. The Scheme will focus on structured payments based on a tariff system which will rank the severity of injuries and compensation applicable. The most notable change, however, is that a ‘no fault’ system will be introduced. This means that the person who caused the accident will also be able to claim for injuries sustained. This contradicts South African principles of the law of delict where wrongdoers are held accountable for their actions or omissions. Like the current system, the Scheme will be funded by fuel levies- the difference being that some of this money will be used to compensate negligent road-users.

It remains to be seen whether the proposed changes will be made into law.

To view the Road Accident Benefit Scheme Bill click: http://www.raf.co.za/Media-Center/Pages/RABS-Bill-Published-.aspx

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Draft guidelines published by Competition Commission

Guidelines on the assessment of public interest provisions in merger regulation under the Competition Act 89 of 1998 published 22 December 2015.

“these guidelines seek to provide guidance on the Commission’s approach to analysing mergers by indicating the approach that the Commission is likely to follow and the types of information that the Commission may require when evaluating public interest grounds in terms of section 12A(3) of the Competition Act” ~http://www.gpwonline.co.za/Gazettes/Gazettes/39560_22-12_EconomicDev.pdf

Section 12A(3) lists public interest factors that must be considered by the Commission.  The Commission may prohibit a merger if it is established that the merger raises substantial negative public interest effects, alternatively it may impose conditions to counter the effect arising from the merger.

Such consideration factors include whether the merger will have an effect on a particular industrial sector or region; employment; the ability of small businesses to become competitive, specifically those controlled or owned by historically disadvantaged persons; and the ability of national industries to compete in international markets.

Deadline for submission of comments is 29 January 2016.

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Fairbridges Wertheim Becker welcomes new candidate attorneys for 2016

This week Fairbridges Wertheim Becker welcomes Zamuxolo Gulwa (UWC), Felicia Hlophe (UCT) and Camilla Salmon (UCT), the new candidate attorneys in the Cape Town office, and Keorapetse Matlala (University of Limpopo) and David Nhlapo (Wits), the new candidate attorneys in the Johannesburg office.

We wish them a successful and happy career in law with us!

 

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Insurance contracts and the duty to disclose

Insurance contracts are contracts of the utmost good faith.  This means that the insured has a duty to disclose to the insurer all material facts and circumstances of which the insured has actual or constructive knowledge.

In the case of Jerrier v Outsurance Insurance Co Ltd, Jerrier had insured his motor vehicle with the insurance provider Outsurance. In terms of the insurance contract, Jerrier would receive bonus points as an incentive for not lodging claims with the insurer for a period of time.  As a result Jerrier chose not to lodge claims for two separate incidents in which his vehicle was involved. Instead, he chose to pay for the damages himself and absorb the loss.

The contract also stipulated, however, that the insured had to notify the insurer immediately of any changes in circumstances that could influence the cover given as well as the conditions and premiums of the insurance contract. The insured was required to provide notice within 30 days of any such change in circumstances.

In 2010 Jerrier’s vehicle was involved in a further collision and he decided to lodge a claim with his insurer. Outsurance, having been informed of the two earlier incidents, repudiated liability for a number of reasons. Primarily however, it argued that Jerrier had provided incorrect information to it, alternatively, failed to disclose material information when he should have.

The court decided that the obligation to disclose the information arose only if the insured wished to enforce the indemnification for the loss which the insurer was obliged to honour. In other words, if the insured was involved in an accident with a 3rd party and the 3rd party agreed to accept payment from the insured in full and final settlement of the damages, there could be no reason to inform the insurer of the incident. The court interpreted the clause concerning a “change in circumstance” as relating primarily to the risk assessment of the insured and his ability to continue paying the premiums at the inception of the contract.  That is to say that the policy In question did not provide for an on-going duty to report after commencement of the contract.

Access the judgement here: http://www.saflii.org/za/cases/ZAKZPHC/2015/34.html

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The end of lawyers?

This New York Times article evaluates a proposition that lawyers will be one of the first white collar professions to be made redundant with the rise of artificial intelligence and increased automation.

Artificial intelligence has been applied particularly successfully in the pre-trial discovery process; where vast amounts of documents and text have to be collected, sorted and presented to each party in litigation. Sophisticated programs are able to sort through copious amount of documents and text in a fraction of the time that it would take a candidate attorney or a paralegal.

Having regard to a study examining the hours billed by lawyers (of which the discovery process generally forms but a fraction) the author points out that the nature of a lawyers work is far more complex and varied then simply sorting through text. At this point in time, even the most advanced technology available today could only modestly supplant the work of a modern day lawyer.

This notwithstanding, the article highlights that the legal profession, which in any event is constantly evolving, will have to continue to adapt in order to remain relevant.

Read the full article here http://bits.blogs.nytimes.com/2016/01/04/the-end-of-work-not-so-fast/?partner=rss&emc=rss&_r=0

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The South African position on a competitor using a trademark as a Google adword

There have been a few international Courts dealing with this issue and South Africa’s first case on the subject was heard at the end of 2014. The result has in all likelihood directly affected how businesses in South Africa –who are aware of it – approach their online advertising and search engine optimisation.

The situation involves two competitors, where the one makes use of the other’s trade mark as a keyword in its Google Adwords campaign for its competing product / service and whether this use amounts to ‘passing off’, a form of unlawful competition or trade mark infringement.

The position by and large in Europe is that provided such use of a competitor’s trade mark as an Adword does not create confusion or mislead anyone, there is no problem. The South African Court adopted this position, in line with international rulings on the matter.

There remains much on be said on this issue, as the South African court was dealing with the passing off of an unregistered trade mark and not the possible infringement of a registered trade mark. The use of the trade mark in the advertisement itself was also not dealt with. It remains to be seen how our courts will tackle the issue of visibility of a trade mark in the advertisement itself or of a registered trade mark and whether this will be allowed in South Africa.

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Season's Greetings!

FWB Attorneys wishes all our clients, colleagues, friends and followers a peaceful and joyous festive season and a prosperous New Year.

We sincerely appreciate your support and comments and look forward to building and expanding our social media interaction with you.

Please note that our offices in both Johannesburg and Cape Town will be closed from 24 December 2015 until 3 January 2016. Our practitioners may be contacted on our emergency lines.

 

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Time out over the festive season

The concept of dies non is defined as a day on which no legal business can be done, or which does not count for legal purposes. What this means is that certain legal documents may not be delivered during this time.

For example, Rule 19(1) of the High Court Rules provides for dies non only in respect of a notice of intention to defend. During this time, from 16 December 2015 to 15 January 2016, the usual period of ten business days after receipt of summons is suspended.

The Constitutional Court has also directed that its dies non will run from 16 December 2015 until 1 January 2016. During this period no applications, responses or notices or processes may be filed, unless specifically permitted by the Registrar.

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Companies undergoing business rescue proceedings need the consent of the business rescue practitioner before commencing arbitration proceedings

According to the Companies Act, when a company is undergoing business rescue proceedings no legal proceeding against the company may be commenced or proceeded with in any forum except with the written consent of the business rescue practitioner. The Act does not define the phrase ‘legal proceeding’ and so the Supreme Court of Appeal (SCA), in the recent judgment of Chetty v Hart, had to determine whether arbitrations are included within the meaning of ‘legal proceeding(s)’.

The SCA discussed the importance of business rescue proceedings and how “it gives the company breathing space so that its affairs may be assessed and restructured in a manner that allows its return to financial viability.” The SCA emphasized that arbitrations, like court proceedings, can also be costly and involve a lot of time that may hinder the effectiveness of business rescue proceedings. The SCA therefore decided that to fulfil the objectives of business rescue, arbitrations must be included within the meaning of ‘legal proceeding(s)’ within the Act. Therefore, if a company is undergoing business rescue proceedings, it must receive written consent from the business rescue practitioner before commencing or proceeding with arbitration proceedings.

Read the judgment here: http://www.saflii.org/za/cases/ZASCA/2015/112.html

 

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The Tax Administration Laws Amendment Bill of 2015 and its amendment to Section 99 of the Tax Administration Act 28 of 2011 (the “Act”)

According to Section 99 of the Act, further assessments  by SARS were limited  to a period of three years after issuance of its first assessment, and five years after the date of a taxpayer’s self-assessment; a so-called prescription period for SARS assessments.   However, in terms of the Memorandum published earlier this year, SARS is faced with complex disputes and interpretations of the tax provisions, and is expending a number of its resources to ensure that it has all relevant information at its disposal before making its assessments. SARS therefore finds it difficult, if not impossible, in certain circumstances, to meet the prescription deadlines. The proposed amendments seek to address these difficulties by allowing SARS to extend the prescription period provided for in Section 99 of the Act, on notice to the taxpayer, which notice must not be less than 30 days before expiry thereof.

 

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Time to Comply with Section 51 of PAIA

Section 51 of the Promotion of Access To Information Act 2 Of 2000 (“PAIA”) states that every “private body” must submit to the South African Human Rights Commission (“SAHRC”) a manual aimed at facilitating requests for information from that private body. Broadly defined, a private body is any natural person, partnership or juristic person which carries on any trade, business or profession.

The manual must contain the following:

The name of the head of the private body as well as that person’s contact details;
A description of all available records generated by the private body stating which are automatically available and those which are available on request;
An outline of the request procedure in terms of PAIA;
A description of the records of the body which are kept in compliance with any other legislation;
A description of the subjects on which the private body holds records, and the categories of records held on each subject;
The fees applicable and which may be charged in terms of PAIA for requests;
The remedies available to requesters if their request for information has been refused; and
Further details facilitating requests for access to a record.

 

Since its commencement date in 2002 Section 51 has remained in abeyance and has not come into effect. On 30 December 2011, the Department of Justice and Constitutional Development further delayed its commencement by placing a morotorium on the section providing all private bodies an additional 36 months to comply. This extension, however, was not granted to private companies which operate within certain sectors of the economy if they had over fifty employees or if the company’s turnover exceeded a nominal amount.

The moratorium will cease on 31 December 2015. After this date, Section 51 becomes compulsory for all private bodies.

There are penalties for non-compliance which are outlined by section 90 of PAIA. A head of a private body who wilfully or in a grossly negligent manner fails to comply with the provisions of section 51, commits an offence and is liable on conviction to a fine, or to imprisonment for a period not exceeding two years. To date the SAHRC has not imposed any fines for non-compliance but reserves the right to do so.

The head of the private body is defined in PAIA and is ordinarily the CEO of the company or any other person who is duly authorised by the private body. The head of the body remains responsible for the submission of the manual.

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One does not simply insult the president – Meme lands doctor in hot water

And on a humorous note –  Turkey: A Doctor has been criminally charged insulting the State President. The Doctor was dismissed from his position at Turkey’s public health service in October after sharing images comparing Erdoğan’s facial expressions to those of the fictional character Gollum of The Lord of the Rings. The crime is a statutory offence arising from the Civil Servants Act which prohibits any civil servant from publishing any “form of political or ideological statement”.

Have a look meme at the centre of the foray available here.

The trial was postponed yesterday when it became apparent that the neither the judge nor the head prosecutor had seen the films based on the epic fantasy novel by JRR Tolkien. As a result expert witnesses had to be called in to determine whether the reference to Gollum was indeed an insult.

This has not stopped fans of the series from weighing into on the question of insult on social media. Some have pointed out that Gollum is an infinitely more complex than the simple grotesque creature known for his split personality, eating raw fish and distaste for rabbit stew and potatoes.

South African Legislation does not generally criminalise the publication of political or ideological statement. But civil damages can be sought by any person if another has intentionally and unlawfully published defamatory material which lowers that person’s reputation in the minds of right-thinking, or right-minded persons.

See more here and here.

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Labour Appeal Court makes landmark ruling regarding the issue of prescription

The background is this: A company had dismissed its striking (protesting) workers following an unprotected strike in 2003. After a long drawn out battle of referrals from one court to the next between 2007 and 2009, a ruling was confirmed that the dismissed employees were to be reinstated with full back pay. The employees were reinstated in September 2009 but not given back pay. After a process to recover this payment, fraught with technicalities,the employees approached the Labour Court on 19 September 2012 for an order to place a value on the arrear wages. The employer raised a defence of prescription to this claim, i.e. that the claim was older than 3 years and could not be pursued.

The Court agreed that the contractual amounts claimed for arrear wages between 2007 and 2009 had indeed prescribed and could not be claimed.

Read the judgment here:- http://www.saflii.org/za/cases/ZALAC/2015/49.html

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CCMA granted jurisdiction over employees based at South African businesses overseas

The Labour Appeal Court (LAC) recently held that the Commission for Conciliation, Mediation and Arbitration (CCMA) has jurisdiction to hear employment disputes concerning employees who work outside South Africa.

In this matter, a fixed-term employee of the London office of South African Tourism was dismissed for misconduct. The employee, Mr Monare, then approached the CCMA which granted an arbitration award in his favour and ordered South African Tourism to reinstate him.

South African Tourism then applied to the Labour Court (LC) to review and set aside the arbitration award. South African Tourism argued that Mr Monare’s contract of employment had no ties to South Africa because he was recruited in the United Kingdom (UK), his contract was concluded in the UK and he had no right to return to South Africa to continue the employment. They also argued that the misconduct had occurred in the UK and that the disciplinary hearing and notice of dismissal all took place in the UK. Justice van Niekerk of the LC agreed and decided that the CCMA did not have jurisdiction to determine Mr Monare’s unfair dismissal dispute.

The matter then went on appeal to the LAC which determined that the South African Tourism office in London was not a separate and independent undertaking from its undertaking in South Africa. The LAC therefore overturned the LC’s decision and decided that the South African Tourism office in London was not outside the territorial jurisdiction of the CCMA and the LC. The LAC based its decision on the fact that the Tourism Act authorises South African Tourism to open and conduct offices abroad where necessary for the effective and proper exercise of its powers, performance of its functions and carrying out of its duties. The LAC argued that the South African Tourism offices in London and South Africa all aim to promote tourism in South Africa and are inextricably linked to one another.

Following this decision it would seem that businesses establishing offices overseas need to bear in mind that if an employment dispute arises, it may be referred to the CCMA if the business is functionally and operationally dependent on the South African office.

Read the judgment here: http://www.saflii.org/za/cases/ZALAC/2015/47.pdf

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DTI clarifies position in regards to conflicting Sector Codes and Generic Codes of Good Practice

The Department of Trade and Industry has clarified the position in regards to Sector Codes not aligned with the amended generic Codes of Good Practice. The Sector Charter Councils were called upon to update the sector codes and bring them in line with the amended generic Codes of Good Practice. All updated sector codes were to be submitted to the Minister of Trade and Industry for approval by 15 November, and those that failed to meet this deadline will be repealed. The question is, which Sector did not meet the deadline?

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The sixth Forum on China-Africa Cooperation (FOCAC) to be held in Sandton tomorrow

The sixth Forum on China-Africa Cooperation (FOCAC) will take place on the 4th – 5th of December 2015 at the Sandton Convention Centre in Johannesburg under the theme, “Africa-China Progressing Together: Win-Win Cooperation for Common Development”.

President Jacob Zuma and President Xi Jinping of the People’s Republic of China will co-chair the summit. African Heads of State and government, representatives from the African Union (AU), heads of regional organisations and multilateral organisations will attend.

The meeting aims to facilitate discussion around areas of common concern including debt relief, science and technology, investment promotion, unemployment – especially among the youth, poverty eradication, water and sanitation, transport, education as well as infrastructure development.

For more information on the summit click here http://www.focac.org/eng/ltda/dwjbzjjhys_1/

For articles concerning Chinese foreign investment in Africa in general click here: https://theconversation.com/what-does-chinas-role-in-africa-say-about-its-growing-global-footprint-49474 and here: http://www.brookings.edu/blogs/africa-in-focus/posts/2015/09/03-china-africa-investment-trade-myth-chen-dollar-tang

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Constitutional Court abolishes delictual claim for adultery

Although adultery is no longer a criminal offence, the Constitutional Court (CC) recently had to decide whether someone whose spouse commits adultery has a delictual right to claim damages against the third party for injury or insult to self-esteem and loss of comfort and society (consortium) of the spouse.

The issue arose from a judgment in the North Gauteng High Court, where a husband successfully sued a third party for damages after the third party had an adulterous affair with his wife. The High Court awarded the husband R 75 000 for damages with interest and costs.

The matter then went on appeal to the Supreme Court of Appeal (SCA) where the issue about whether this type of delictual claim should continue to exist in our law was raised. The SCA determined that based on the changing views of society, there is no longer a place for a delictual action for adultery in a modern legal system.

The husband of the adulterous spouse disagreed and brought the matter on appeal to the CC. The CC considered the historical trajectory of such claims, the position in foreign legal systems and the evolving societal norms towards adultery and the institution of marriage. The CC found that although South Africa’s neighbouring countries like Zimbabwe, Namibia and Botswana have retained the action for damages for adultery against a third party, internationally, the trend has been to eradicate civil claims for adultery. Justice Madlanaga, in his unanimous judgment, decided that in this day and age, the changes in public policy and the community’s general sense of justice has dictated that the element of wrongfulness in the delictual sense is lacking and therefore, delictual claims for adultery are outdated and should be abolished. Justice Madlanaga also emphasized that a court could not assess marital fidelity in terms of money and that there was a need to develop this area of law to bring it in line with constitutional values. The CC therefore decided that the innocent spouse’s delictual action for adultery against the third party is outdated and unconstitutional.

Read the judgment here: http://www.saflii.org/za/cases/ZACC/2015/18.html

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Prescription of arbitration awards - you snooze, you lose.

Judge Coppin has handed down an important judgment regarding the prescription of arbitration awards issued by the CCMA and Bargaining Councils. Prescription is the expiration of the right to enforce a claim after the lapse of a prescribed period of time.

Previously, the courts have held that regardless of the type of award, even in instances of reinstatement, the Prescription Act would certainly apply. An award may be classified as a debt for the purposes of the Prescription Act.

In determining the timeframe associated with prescription of awards, the judge ruled that an award is not a judgment debt but rather a simple debt. Thus a period of three years would apply to the award in terms of prescription. The judge also made it clear that the certification of an award and even the issuing of a writ in respect of the award does not interrupt the running of prescription.

This judgment is important for both employees and employers to ensure that they are aware of the operation of prescription, whether it serves as a motivation to quickly prosecute their matter in the case of an employee, alternatively a useful defence for employers.

Read the judgment here: – http://www.saflii.org/za/cases/ZALAC/2015/45.html

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The Sasol excessive pricing saga comes to an end

In 2007, the Department of Trade and Industry approached the Competition Commission to investigate the pricing practices in the South African chemicals section. The Commission then raised a complaint against Sasol for excessive pricing of propylene and polypropylene.

Propylene is a by-product of fuel and is used to produce polypropylene. Polypropylene is used to manufacture plastic products. Sasol produces far more propylene and polypropylene than is required in the South African market because of its extremely low production costs. Sasol therefore sells roughly half its production to abroad markets. Despite its low cost and abundance of propylene and polypropylene, Sasol sells it at import parity prices.

In 2014, the Competition Tribunal decided that Sasol was charging excessive prices for its propylene and polypropylene to its South African customers and that Sasol had therefore breached South African competition law. Sasol was instructed to pay administrative penalties amounting to R534 million.

The Competition Appeal Court (CAC) then overturned the Tribunal’s decision in 2015. The CAC analysed Sasol’s capital assets, level of capital return on the capital, the allocation of group costs and the allocation of fixed costs between domestic and export sales. The CAC decided that if all these factors are taken into account, the 12-14% mark-up above economic value for propylene would not justify judicial intervention and could not be considered unreasonable. The CAC relied on cases from the European Union which argued that prices under 20% above economic value would not justify judicial intervention.

The Commission then appealed to the Constitutional Court and raised the issue of whether South African competition legislation could be interpreted to allow Sasol Chemical Industries to continue charging maximum prices in perpetuity or not. On 17 November 2015, the Constitutional Court dismissed the Commission’s application for leave to appeal. This means that the Commission will remain bound by the CAC decision. It seems that it will now be very difficult to prove instances of excessive pricing unless the profit margins are extremely high.

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Who is the copyright owner of your logo?

It is common place for a company to outsource and pay an outsider, such as a branding agency, to create its logo. However, who is then the owner of the copyright in the logo? Typically it is only once faced with a dispute that the company realises that it is, in fact, not the copyright owner of the logo of its business.

In terms of South African Copyright law, Section 21 (1)(c) of the Copyright Act provides that where one party commissions another party to create a work, provided it is a photograph, portrait, gravure, sound recording or film, the copyright belongs to the party that commissions the work if it pays or agrees to pay for the work. Therefore, this provision does not provide for other artistic works or literary works, which means that the person who created such work is the first owner of the copyright. However, if you are aware of this you can avoid this unwanted situation by making sure that there is a clause in your contract with the designer of your logo stating that they agree to transfer copyright ownership over to you – it is key for an assignment of copyright to be in writing and signed by or on behalf of the assignor.

There have been a few cases in the UK where such precautions were not taken and the logo designer has asserted its copyright ownership in the logo. In these case the UK courts have come to the assistance of the brand owner either stating that it was an implied term of the contract for the creation of the logo for the copyright therein to be assigned to the brand owner or that it doesn’t make sense for the copyright to remain in the designer’s ownership as this is “unusual and commercially dangerous” for a brand owner. In these matters the UK courts have ordered that the designer formally assign the copyright in the logo to the brand owner.

A South Africa court has yet to deal with such a dispute and it is unclear whether it will take the same view as the UK courts, however it is likely that a South African court will find the UK decisions persuasive.

Nevertheless, the position in South Africa is not certain and this is a situation that can easily be avoided if the aforesaid precautions are taken when commissioning an outsider to create your logo.

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Broad-Based Black Economic Empowerment (B-BBEE) updates

There has been a call for comment, by 30 November 2015, on the draft B-BBEE verification manual.  This manual is to be used by all verification agencies when issuing B-BBEE Certificates. It states that “any representation made by an entity about its B-BBEE compliance must be supported by suitable evidence or documentation” and “an entity that does not provide evidence or documentation supporting any initiative, must not receive recognition for that initiative.” Once in force, all verification agencies will be required to comply with this Manual in order to retain their accreditation. Failure to apply when verifying an entity can amount to unprofessional conduct.

The draft manual brings it in line with recent amendments to the Act and Generic Codes of Good Practice, where fronting practices have been criminalised, all with a focus on ensuring proper compliance with the Act and its Codes.

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TerraLex Mergers & Acquisition Practice Group Publishes Summary Guide to Corporations in Europe

FWB’s affiliate network Terralex has produced, with the assistance of its European member firms, a document which outlines the principal characteristics of corporate structures within European Union member states.

The useful document aims to provide legal practitioners and their clients with a concise reference to the corporate structures and corporate law which become applicable in different jurisdictions.

As the exclusive South African member of Terralex, Fairbridges Wertheim Becker is in the unique position to have to have access to and a relationship with a Global network of independent and recognised legal practitioners.

To learn more about Terralex, click here.

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The implementation of a carbon tax in South Africa - things are heating up!

The draft Carbon Tax Bill has been released for public comment. The introduction of a carbon tax aims to alter producer and consumer behaviour by punishing polluters to protect the planet. According to the United Nation’s climate change unit, global temperatures have increased by two degrees in the last century. This has altered rainfall patterns and increased the frequency of floods and droughts in South Africa, making it all the more urgent that the amount of greenhouse gas emissions in the atmosphere are reduced.

South Africa’s National Climate Change Response Policy (NCCRP) and the National Development Plan (NDP) both emphasize the importance of government’s policy on climate change. Introducing a carbon tax should form a major part of implementing these policies. The National Treasury has published the draft Carbon Tax Bill to allow the public an opportunity to comment. Although the Minister of Finance will determine the final carbon tax rate, exemptions and the actual date of implementation; members of the public have an opportunity to comment on the design and technical details of the carbon tax policy and administration.

The proposed tax is expected to be imposed at a rate of R120 per tonne of carbon dioxide, rising by 10 percent every year. There are certain tax-free thresholds which would mean that a company shall only pay R6 per tonne of carbon dioxide if all the thresholds were applicable, and a maximum of R48 per tonne of carbon dioxide if not. This aims to influence the behaviour of companies by incentivising them to move towards cleaner technology. It is estimated that the carbon tax would help South Africa achieve its goal of reducing greenhouse gas emissions in 2020 by 34% and by 42% in 2025.

The chairman of the Davis Tax Committee, Judge Dennis Davis, has warned that the implementation of a carbon tax will result in companies passing on the additional cost to consumers, and that this will place a heavy burden on the poor. Others have noted that a carbon tax would make it very difficult for South African businesses to compete in the international arena because of its dependence on fossil fuels.

Once the comments have been incorporated into the revised bill, it will be submitted to Cabinet for approval for tabling in Parliament.

To view the draft bill go to www.treasury.gov.za

Written comments must be submitted to Dr Memory Machingambi at Memory.Machingambi@treasury.gov.za by the close of business on 15 December 2015.

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Trademarks - all you need to know about the basics

A trade mark is a word, phrase, symbol or design, or a combination of them, that identifies and distinguishes the source of a trade mark from that of another, providing the owner with exclusive rights to use it or to authorise another to use it in return for payment. The important criterion for registration is whether a mark is capable of distinguishing the goods of one trader from those of another.

Without a registration of one’s mark, one would need to prove reputation and/or goodwill in the name. A registered trademark gives one quick access to the numerous protections and remedies housed in the Trade Marks Act.

There are many benefits to having a registered trade mark, least of which is that it reduces the chances of becoming involved in litigation. Where conflicting claims to a mark arise, registration is prima facie proof of a registered right in the name. It also assists in ‘cybersquatter’ attacks, where persons unknown, usually in countries outside of South Africa squat on the domain of your mark, and then sell it to you for an inflated sum of money. A registered trademark can easily be commercialised through licensing agreements – the most well-known of which is franchising – rendering the trade mark an even more valuable asset of a business.

Prior to registration, an endorsement – a small ™ symbol – may be used on the upper right hand side of the mark. This serves as notice to third parties that the trade mark is the subject of a pending registration. This is amended to an ‘R’ once registration is granted.

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Rood reviews the latest authoritative text on the Recognition of Customary Marriages Act

REFORM OF CUSTOMARY MARRIAGE, DIVORCE AND SUCCESSION IN SOUTH AFRICA

By Chuma Himonga and Elena Moore

(392 pages)

Juta & Co (Pty) Ltd

www.jutalaw.co.za

“I was married to my husband for many years; one day he decided to leave our marriage and go shack up with another woman. While he was away, his sisters came to chase me out of the house we shared. I left our home and went to build a new life for myself.”

This rich and finely-researched study sets out to examine the impact in practice of the reforms contained in the Recognition of Customary Marriages Act 120 of 1998, and the groundbreaking judgment of the Constitutional Court in the case of Bhe v Magistrate, Khayelitsha 2005 (1) SA 580 (CC).

So often the legislative proclamations of Parliament and the dry decisions of the courtroom fail to reach or penetrate the lives of those persons most in need of their regulation and protection.

The co-authors correctly state: “Law is intended to benefit and improve the lives of people targeted by it.” They adopt a socio-legal approach to measuring and assessing the impact and success of legislation. They seek to show how legal rights are translated into reality by paying attention to the practicalities, norms and perceptions of how the people living according to customary law perceive and adopt the reformed laws.

The extensive field research, data gathered and interpreted, observations made, and interviews conducted (many of which are quoted verbatim and make for compelling reading) will undoubtedly contribute to the effectiveness of legal policy in providing a tangible context within which to understand, interpret and apply the law. This will enable constitutional rights and the protection of family members to be more effectively implemented.

Every aspect of customary marriages is dealt with, as are polygymous marriages, their registration and dissolution. Equality of spouses, the role of the Department of Home Affairs, Churches and Traditional Leaders, family dispute resolution and the custody and maintenance of children are all examined.
Special attention is given to intestate succession and the challenges this presents. The importance of family life, gender equality and the protection of children in our often fractured communities and society cannot be over-emphasised.

This remarkable and comprehensive contribution to a hitherto sparse area of research impressively maintains a calm, objective and realistic tone which underscores the credibility of the conclusions of the co-authors. They point out how some of the inconsistencies between the law and its application have positive outcomes, while others do not.

Congratulations are due to the co-authors Professor Chuma Himonga of the Department of Private Law at the University of Cape Town, where she holds the Chair in Customary Law, Indigenous Values and Human Rights established by the Department of Science and Technology’s South African Research Chairs Inititiative, managed by the National Research Foundation of South Africa, and Elena Moore, a Senior Lecturer in the Department of Sociology at UCT where she is Director of the Families and Societies Research Unit at the Centre for Social Science Research.

Special mention should be made of law publishers Juta who once again demonstrate their sure grasp that law has to be seen in a much broader context, and law reform both draws upon and shapes that context.

“The insights gained into the way in which both individuals and communities are responding to the changes in the law are invaluable… (This book) makes a remarkable contribution to our understanding of how law reform affects communities, how effective it is, and most importantly how it becomes absorbed as part of ‘living customary law’.”
– Professor Julie Stewart, University of Zimbabwe.

Review by Louis Rood BA LLB (UCT) of Fairbridges Wertheim Becker.

 

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"Smart-shopping” lands an employee in hot water

A Pick n Pay Employee has been dismissed for “stealing” smart shopper points. The Employee, who was a cashier, devised a plan to accumulate smart shopper points fast. Each time a customer came to the till she would proceed to swipe her smart shopper card and accumulate that particular customer’s points for that purchase.

After an investigation, it was found that in one day she had swiped her own card 28 times. The Employee was dismissed and subsequently she referred the matter to the CCMA on the basis of an unfair dismissal.

The CCMA Commissioner held that whilst he agreed that the Employee was guilty of the charges levelled against her, the sanction of dismissal was far too harsh as the Employer had not actually suffered any actual loss as a result of the Employee’s actions, and further that the Employee had shown remorse for her actions.

The Employer then approached the Labour Court to review the matter. Judge Lagrange held that the position in which the Employee was in required utmost honesty and integrity. Further that the explanation that the customers had insisted that the Employee use her smart shopper card on their transactions was completely improbable.

The arbitration award was thus set aside and the judge ordered that the dismissal of the Employee was substantively fair.

http://www.saflii.org/za/cases/ZALCJHB/2015/373.html

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High Court Debtors Beware

 

If judgment has been granted against a debtor (a company, an individual), let’s call it a hypothetical XCo, in the Magistrate’s Court, the judgment may be rescinded once XCo has paid the debt and the creditor –let’s say, a bank – has consented to having the judgment rescinded (think set aside/ incinerated).

Those such as XCo who have High Court judgments against their names do not have it as easy. The Court’s view is simple – to allow judgments to be set aside after the debt has been settled –even if the bank has consented – would create the false impression that the there was never any adverse default. This would, say the Courts, prejudice potential future creditors. The fact that a judgment affects one’s creditworthiness is not a sufficient reason to grant the rescission. So how would one remove this black mark?  One of the possibilities is to show that that there was never ‘willful default’ in allowing judgment to be granted.  Next, one must show a substantial defence and ‘good cause’ to bring the application.

‘Good cause’ includes situations where an order or judgment was incorrectly sought or granted in the absence of any affected party; or, there is an ambiguity, patent error or omission to the extent of such ambiguity; or an order or judgment was granted as a result of a mistake common to the parties.

In short, unless XCo can prove that it did not act in willful default and that they have good cause to bring the application, an application for the rescission of judgment, even with the creditor’s consent, will not be successful in the High Court.

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Harvard Law School Library plans to make collection available free online

The Harvard Law School Library has one of the most extensive collections of legal texts in the world. The Library recently announced that it plans to scan almost every volume in its shelves and upload the 40 million odd pages online. The move comes at a time technology is sophisticated enough to meet the public’s demands for greater access to justice.

The collection will be available at www.ravellaw.com and will be free for anyone to use. Ravell, the company backing the drive, hopes to make money from the initiative by providing additional analytical tools to users for a fee. These will allow users to comb the database with relative ease and precision.

Organisations such as Southern African Legal Information Institute (SAFLII) aim to provide an online repository of legal information to promote and support free access to public legal information in South Africa. Saflii is a member of the Free Access to Law Movement.

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Fascinating new book released on Forensic Investigation

“Because a case in court in only as good as the investigation that has been conducted by the police, this book is set to play a significant role in ensuring that current and future generations of investigators remain in tune with the challenges and changes in policing and the prosecution of crime.”

-Advocate Gerrie Nel

This comprehensive book expertly combines aspects of the natural, social and human sciences with the management skills required for the investigation and prosecution of crime.  The editors write:

“Forensic investigation … is broadly defined as an in-depth, meticulous search for the truth through the use of specialised skills and expert knowledge and the application of scientific investigation methods and techniques, with the aim to lawfully discover, collect, prepare, identify and present evidence in a court of law or to a disciplinary council, instructing client or company.”

The field of forensic investigation has grown significantly in South Africa over the past few years.  Investigations are now also undertaken by private and corporate bodies, and by government institutions other than the South African Police Service.

Forensic investigation is a continually evolving science, which must be conducted within the legal ambit of the Constitution.

The team of expert contributors bring a wealth of academic and practical experience to every chapter, moving from the scene of the incident, to the laboratory, to the courtroom.  Sophisticated aspects, such as medica-legal evidence, DNA analysis imprints, firearms, disputed documents, offender profiling, cellphone data, and cybercrime are dealt with in detail.  Case studies, full colour illustrations, a glossary of terms and tables of relevant cases and legislation, all contribute to making this well-organised and indexed volume accessible.

The chapter on developments in forensic technology ensures that current and future investigators are made fully aware of the challenges and changes in the investigation of crimes, incidents and transgressions.  Each chapter contains references for further research and reading.

The editors, contributors, Juta Law Publishers, with the backing of the University of South Africa, the South African Police Service, the Council for Scientific and Industrial Research, and others, are to be commended for their production of a truly exceptional, invaluable and essential resource for all investigators, legal practitioners and judicial officers.

Review by Louis Rood BA LLB (UCT), Chairman of Fairbridges Werheim Becker

FORENSIC INVESTIGATION

Legislative Principles and Investigative Practice.

by Rudolph Zinn & Setlhomamaru Dintwe (Editors)

(537 pages)

Juta & Co (Pty) Ltd

www.jutalaw.co.za

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Defamation – Exercise caution with what you post on Facebook and other social media platforms

The District Court of Western Australia ruled in favour of Ms Massy, a woman who had posted a review of an accountant on the UK Immigrants Group Facebook Page.  She called the accountant “unprofessional, rude and obnoxious” as well as a “clown” who “wanted $550…antagonised my boyfriend and hung up on me, interrupting me several times prior. DEFO not worth $550 in my eyes ”

What has been said to be a ‘rarely successful defence’ was proven effective for Ms Massy, who had shown the court that it was her ‘honest opinion’.

Judge Schoombee in ruling on this matter, stated that  “the ordinary reasonable reader would also realise that what one person might regard as ‘overcharging’ might be a reasonable fee to another to whom a meticulous service or a reliable service provider was important” but that “this does not mean that a member of a Facebook page has carte blanche to defame service providers or other persons or that all statements made necessarily qualify as opinions”.

Similar actions are becoming more and more commonplace in South Africa, as social media use has skyrocketed, with users frequently broadcasting their opinions without censorship. Defences such as “fair comment” and “truth and public benefit” could similarly be used to ward off defamation claims, such as in the Australian case, though the most cautious approach may be to share one’s most honest potentially harmful views in private.

Read more.

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Cohabitation and the reciprocal duty of support

For many years South African courts have emphasized the importance of marriage as a social institution and valued the rights and obligations that flow from it. One of the most important obligations is the reciprocal duty of support and South African law recognizes various forms of family relationships that create this duty. Today, many people prefer to live together without entering into a marriage or civil union. This has been referred to in court judgments as ‘cohabitation’.

In a recent case, the Cape Town High Court had to determine whether a reciprocal duty of support existed between a couple that were involved in a brief period of cohabitation. A married German man (the respondent) entered into romantic relationship with a South African woman (the appellant) and allowed her to live in his house as he was in Germany for most of the year. He provided her with funds to maintain the house and gave her numerous gifts. The romantic relationship soon came to an end and he requested that she find elsewhere to stay. She refused to vacate and claimed that he had promised to allow her to stay in his house for ten years. He denied this allegation and stressed that he had no obligation to maintain the appellant.

The Magistrate’s Court agreed and held that there was no reciprocal duty of support between parties in a cohabitation relationship.

The matter then went on appeal in the Cape Town High Court and Judge Goliath and Judge Schippers agreed that although no reciprocal duty of support arises from a cohabitation relationship, it is still possible for the duty to be regulated by agreement. The Judges discussed that sometimes an express or implied universal partnership exists between parties in a cohabitation relationship. A universal partnership exists when parties act like partners without entering into a partnership agreement and both parties contribute to the partnership for their joint benefit.

The fact that the appellant was allowed to stay in the respondent’s property was solely based on the romantic relationship and the respondent never envisaged that the appellant would play an active role in his personal affairs. The respondent emphasized that they had not established a joint household and that the appellant had never contributed towards his expenses.

The Judges therefore decided that no universal partnership existed between the parties and therefore there was no duty of support. As a result, the appellant was ordered to vacate the property.

Read the judgment here: http://www.saflii.org/za/cases/ZAWCHC/2014/120.html

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Rood reviews: Crime Scene Investigation by Hendrik Lochner and Rudolph Zinn

The Rule of Law as a fundamental principle of our constitutional state is only a reality if crime, irregularities or transgressions are detected, investigated, and the perpetrators identified and brought to book.

Crime Scene Investigation is a practical guide dealing with the management, control and processing of “scenes of incident”.  It deals logically with every necessary step from responding to a call-out, controlling or securing the scene, avoiding contamination of evidence, handling of persons on the scene, and the recognition, protection, recording, collecting, packaging, marking and transportation of physical evidence.

The co-authors have a wealth of experience in crime investigation in the South African Police Service.  Hennie Lochner holds a Master’s degree in forensic investigation, and a BTech degree in Policing and Security Risk Management.  Professor Rudolph Zinn has a doctorate in Police Science   Both are acclaimed published authors.  Their common sense approach, illustrated by actual examples, is aimed at supporting the professional conduct of investigators tasked with solving a crime and those who are first to arrive at the scene.

Extensive coverage is given to investigation aids including fingerprints, ballistics, pathology, dog handlers and trackers, blood-pattern analysis, electronic evidence, and cellphone analysis.  Methods of searching a scene and managing extraordinary circumstances such as fire scenes, explosives and bomb sites, dangerous and hazardous materials, and mass and multiple scenes are all dealt with meticulously and methodically.

This book is the latest release in the Legal Essence stable of the Juta Legal-Ease Series, setting out clear and practical frameworks with useful pointers and helpful guidelines to equip the reader with a solid working knowledge of the content in a legal context.  The expertise of the co-authors in doing so in detail with a complex and intricate subject makes this an essential handbook not only for police investigators, but also corporate investigators and those tasked with civil claims and disciplinary cases.  The co-authors encourage all those with such responsibilities to “continually update their knowledge, skills and abilities through training and academic development.”  This is a fascinating, informative and instructive volume and a valuable contribution to upholding the Rule of Law.

Review by Louis Rood BA LLB (UCT) of Fairbridges Wertheim Becker.

CRIME SCENE INVESTIGATION

By Hendrik Lochner and Rudolph Zinn

(189 pages)

Juta & Co (Pty) Ltd

www.jutalaw.co.za

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Happy Halloween!

It has been said that Halloween’s origins date back to the Ancient Celtic Festival of Samhain.

What is now more of an American tradition, originated from the Celts, who lived in and around what is now known as Ireland, the UK and northern France, celebrated ‘Halloween’, believing that on this night, “the boundary between the worlds of the living and the dead became blurred”.

Dating as far back as 2000 years ago, “this day marked the end of summer and the harvest, and the beginning of the dark, cold winter, a time of year that was often associated with human death.”

“Celebration of Halloween was extremely limited in colonial New England because of the rigid Protestant belief systems there. Halloween was much more common in…the southern colonies [of America]. As the beliefs and customs of different European ethnic groups as well as the American Indians meshed, a distinctly American version of Halloween began to emerge” (http://www.history.com/topics/halloween/history-of-halloween)

Halloween was celebrated in Cape Town at the Zombie Walk and Festival. It started in the Company Gardens, and ended at the V&A Waterfront, and was described as the Mother City’s very own zombie apocalypse!

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Trademarks and Chocolate

The German Federal Court of Justice has recently decided in favour of Lindt and its chocolate bear in a golden wrapping (a well-known favourite during the festive season). The court found that the Haribo’s gummy bear sweets and its trademark, the “GoldBear” was not being infringed by Lindt’s gold bear, finding that there was no similarity! Apparently, Haribo only applied for the trademark “GoldBear” after learning of Lindt’s decision to produce golden chocolate bears.

Can you tell the difference?

 

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"Companies to be formed"- are they on the shelf?

“Earlier this year, the Durban High Court discussed the meaning of the words “company to be formed” in a sale agreement. Three businessmen decided to purchase immovable property which would eventually fall under the name of a newly-registered company. The businessmen therefore signed the contract of sale in their capacity as directors for a “company to be formed”.

After signing the agreement, however, the businessmen decided that it would be easier to use a shelf company to take transfer of the property instead of waiting for a new company to be registered. A shelf company is a company that is already incorporated but has not yet engaged in business transactions or activities. They are described as having a ‘clean’ balance sheet and are available ‘off the shelf’ as a juristic entity. In order to save time, the businessmen acquired a shelf company and became its directors. The price of the immovable property was then secured and the purchasers took occupation.

Before the transfer of the property had taken place, however, the seller decided that it no longer wished to proceed with the sale. The seller claimed that the agreement with the purchasers was not valid nor binding because the company was already in existence when the agreement was signed. The seller argued that the businessmen sought to conclude a pre-incorporation contract and instead used a shelf company which was already incorporated and so it did not qualify as a purchaser in terms of the agreement.

The purchaser, on the other hand, argued that the contract envisaged that the rights and obligations be taken up either by a company already incorporated (like a shelf company) or by one not yet incorporated. They argued that the words “to be formed” did not necessarily mean that a new company must be incorporated.

Judge Olsen agreed and found that the words “to be formed” must be read to mean that the company stepping into the shoes of the purchasers should not have been involved in any previous business transactions. This would be the case for both shelf and newly-incorporated companies. Judge Olsen therefore ruled that the sale agreement was valid and binding.

Read the judgment here: http://www.saflii.org/za/cases/ZAKZDHC/2015/20.html

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Book Review: Fundamental Rights in South Africa by F. Venter

“Fundamental rights lie at the heart of the South African legal order.  Their wide scope and central place in the supreme Constitution to which all law and legally relevant conduct are subject render knowledge and understanding of the Bill of Rights crucial to the mastery of literally every discipline of law….”

The author of this gem of a work, Professor Francois Venter of the Faculty of Law, North-West University, has an assured and sound grasp of his subject.

His years of experience are revealed in the deft and lucid manner in which he deconstructs the complexities of the Bill of Rights.  He correctly points out:  “Fundamental rights is not a simple theme, nor is it easy to master.”

No legal practitioner can avoid the all-embracing reach of the Bill of Rights.  This concise, carefully-crafted and well-organised introduction is the ideal entrance to the centrality of fundamental rights in our Constitution.  Chapters deal succinctly with the interpretation of the Bill of Rights and the various categories of rights.  These include socio-econcomic rights such as housing, health care, water and social security, and the recognition of pluralism in our diverse society, for example language and cultural rights.

Conventional human rights are covered, such as freedom of expression and religion, and more modern social and political rights encompass privacy, freedom of trade, occupation and profession, environmental rights, access to information and just administrative action.

This compact textbook, with its pertinent references to relevant case law and statutes, as well as a useful guide to further reading, is a refreshing and accessible aid to understanding and getting to grips with the very core of our legal system.  The author and publishers Juta are to be commended for a production of a handbook that will be welcomed by scholars, students, practitioners and researchers alike.

Review by Louis Rood BA LLB (UCT) of Fairbridges Wertheim Becker.

FUNDAMENTAL RIGHTS IN SOUTH AFRICA

By Francois Venter

(91 pages)

Juta & Co (Pty) Ltd

www.jutalaw.co.za

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Africa Oil Week

The 22nd annual Africa Oil Week kicks off today in Cape Town. The weeklong conference boasts a 100 speaker line-up from Governments, leading companies, and key players inside Africa’s oil and gas industries.

The conference organisers, Global Pacific & Partners, aim to, “provide an event of rich-content with highest quality, first-class networking and social interface, and multiple opportunity for all to create and cement relationships that will shape the future for oil and gas in Africa, and the economic future of the Continent.”

Energy and resources remain key to Africa’s economic development and this conference promises to focus on the key drivers.

Click here for more information.

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Promotion of Access to Information Act 2 of 2000 (“PAIA”) - is your company PAIA compliant?

Is your company required to provide a manual  in terms of Section 51 of PAIA? The Minister has exempted all private companies from providing PAIA manuals, unless that company falls within one of the specified companies. This exemption is however only valid until 31 December 2015. This manual is regarded as a step by step guide for a third party to request information from your company, in terms of the PAIA.

See the South African Human Rights Commission Guide on PAIA  which provides an easy to understand overview of PAIA, sets out who must provide a manual and what your manual must include, and provides a step by step guide on how to make an information request.

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Australian Court imposes penalty for false or misleading claims by Homeopathy practitioner

The Australian federal Court has ordered the company Homeopathy Plus to pay penalties of $115,000 and its director, Frances Sheffield, to pay $23,000 for making false or misleading representations about the effectiveness of the whooping cough vaccine and homeopathic remedies as an alternative to the whooping cough vaccine. Furthermore, the company was also ordered to remove its advertisements which made this claim.

The claims were found to contravene section 18 of the Australian Consumer Law. (ACL) which states:

“A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.”

South Africa, like Australia, has enacted legislation to protect the consumer. Perhaps the most obvious example of which is the Consumer Protection Act (CPA). As with section 18 of the ACL, section 41 of the CPA prohibits suppliers making false, misleading or deceptive statements about goods or services they provide.

See full article here.

Find the judgement online here.

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New legislation to make South African mine dumps and stockpiles more environmentally friendly

Mining waste is no longer regulated by the Mineral and Petroleum Resources Development Act and instead finds itself more appropriately under the National Environmental Management Waste Act.

Under the new legislation, a waste management licence is necessary in order to create a residue stockpile. Applicants for this licence must first satisfy environmental impact assessment (EIA) requirements. This is a far more stringent approach to the previous legislation which did not require a waste licence but only an approved environmental management plan.

The management of stockpiles and residue deposits will probably be more expensive as stockpiles now have to be designed by a registered civil or mining engineer and must comply with all statutory landfill and disposal requirements. If the waste involved is as a result of prospecting or activities requiring mining permits, then a simple EIA is required. On the other hand, if the waste is as a result of activities requiring a mining right, exploration right or production right, then a full scoping EIA must be undertaken. These changes have meant that mining companies will now also have to undergo far more public participation and involvement.

These changes, although expensive, will have a far greater impact on restoring and preventing environmental damage. The penalties for contravening the new regulations also carry weight as anyone found guilty will face up to 15 years imprisonment or an appropriate fine.

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The use of replacement labour during protected strikes – SACCAWU V SUN INTERNATIONAL

Trade Union SACCAWU(the Applicant) sought an order against Sun International (S.I,.) on the following terms:-

–              Declaring S.I.’s unlimited duration lock out is not in response to strike action;

–              Interdicting and restraining the S.I from employing replacement labour in respect of those employees it has locked out.

S.I. in its argument relied on the authority of Ntimane v Agrinet t/a Vetsak (Pty) Ltd (1999) 20 ILJ 896 (LC) which stated that the right to employ replacement labour commences from the stage that an employer acts in reply to a strike and  that such right remains until the protected lock-out ceases.

The judge’s explained that the constitutional right to strike is not equivalent to the statutory right to lock-out. Thus, when interpreting section 76(1)(b) Labour Relations Act (LRA), one should do so in a manner which does not infringe on the constitutional right to strike. It was therefore held that the correct interpretation of section 76(1)(b) of the LRA is that the statutory right of an employer to hire replacement labour is restricted to the period during a protected strike and not after it has ceased. The Applicant was therefore successful in obtaining the interdict.

It follows that Employers may only employ replacement labour whilst the strike continues and thereafter the employees who embarked on the protected strike must be permitted to return to the workplace.

Read the judgment here:- http://www.saflii.org/za/cases/ZALCJHB/2015/341.html

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FWB Director attends annual meeting of the International Bar Association in Austria

Melanie Kilian of Fairbridges Wertheim Becker attended the annual meeting of the International Bar Association (IBA) in Vienna, Austria in October 2015. Over 6000 attorney delegates from all over the world attended the proceedings where the focus this year was on humanitarian issues and the refugee crisis affecting the Middle East, North Africa and Europe. Delegates were addressed by Jose Manuel Barroso, former Prime Minister of Portugal and eleventh President of the European Commission. He emphasized that being an attorney is much more than merely practising law but it is also about the contribution you can make to assist people as in a humanitarian crisis and society as a whole. There was plenty of time for delegates to enjoy the many attractions of the ancient city including a reception at the British Embassy, a performance by the Vienna Boys Choir and the breathtaking routines of the Lipizzaner horses and riders.

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Full transcripts of JSC interviews available here

Last week the Judicial Service Commission (the JSC) interviewed candidates for various judiciary positions in the High Courts of South Africa.

If you’ve missed the media reports, you can find the full transcript of each interview here.

If you’d like to find out more about the JSC click here.

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Court finds that insurer cannot repudiate a claim based on the insured’s failure to disclose a previous incident

The Court has recently decided against Outsurance in Jerrier v Outsurance Co Ltd 2015 (5) SA 433 (KZP), having concluded that an insurer cannot repudiate a claim just because the insured failed to disclose a previous incident.

The KwaZulu Natal High Court  examined the policy and the responsibilities imposed on the insured in terms of his policy.  One of the obligations imposed on the insured, was to notify the insurer of any incidents, even if the insured did not want to submit a claim, and to do so within 30 days.

The insured failed to do so, and the insurer wanted to repudiate a later claim because of it.

The Court found that –

“As long as the appellant understood that he would have no claim against the insurer for those incidents at the time or at any time in the future, there was no obligation to him to bring the matter to the attention of the insurer… “

” the obligation to report “incidents” is not set out with any particularity and is bound to lead to uncertainty as to what should and should not be reported, especially where the insured has no intention of lodging  a claim.”

http://www.saflii.org/za/cases/ZAKZPHC/2015/34.pdf.

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FWB at the Standard Bank Golf Day, Cancer Foundation, Johannesburg

The Fairbridges Wertheim Becker team attended a Standard Bank Golf Day on 9 October 2015 in aid of the Cancer foundation.

Blair Wassman, Richard Hutchinson and Jayson Rebelo of the Johannesburg office manned the second hole on the beautiful Glenvista Golf Course in the south of Johannesburg.

This event was attended by various corporates to show their support in raising awareness and contributing towards cancer research.

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Does liability automatically ensue if there is a statutory duty to act?

In 2004, a UK tourist went on a tandem paragliding flight near Hermanus in the Western Cape, which left her paralysed after the paraglider lost height and manoeuvrability, resulting in a collision with the nearby mountain. The paralysed passenger then claimed R25 million in damages against The South African Hang and Paragliding Association (SAHPA) and The South African Civil Aviation Authority (SACAA). At the time, tandem paragliding for reward was illegal and both the SAHPA and SACAA were aware that this illegal activity was being conducted by various paragliding companies.

The Western Cape High Court found that the SAHPA and SACAA had a legal duty to take reasonable steps to prevent the illegal activity and that they had been negligent in failing to do so. The plaintiff was therefore successful. The SAHPA and SACAA then appealed to the Supreme Court of Appeal (SCA) where the question of wrongfulness in the case of negligent omissions (or the failure to act) was addressed.

Under our law of delict, if negligent conduct in the form of a positive act results in harm (like physical injury or damages), then wrongfulness is presumed. On the other hand, if the harm is as a result of a negligent omission, then wrongfulness is not presumed and liability depends on the existence of a legal duty. Whether or not a legal duty exists is a matter for judicial determination and is dependent on public policy and constitutional norms.

The SAHPA and SACAA argued that the payment of a reward did not influence the safety of the passenger and that it would not be reasonable to impose liability on them for an omission that did not relate to aviation safety. The SCA handed down judgment earlier this year and decided that although the SAHPA and SACAA had a statutory duty to take steps to prevent an illegal activity, their failure to do so was not wrongful in the delictual sense, especially since the activity was in the process of being legalised.

This judgment reiterates that wrongfulness is not presumed in the case of a negligent omission and that the failure to act in accordance with a statutory duty may not be sufficient to claim liability. Ultimately, wrongfulness in these cases will depend on whether it is reasonable in the circumstances to compensate the plaintiff for a breach of his legal right and this, in turn, is dependent on public policy.

Read the judgment here: http://www.saflii.org/za/cases/ZASCA/2015/34.html

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Fairbridges Wertheim Becker supports the Global March for Elephants, Lions and Rhinos

On Saturday, Kirstenbosch National Botanical Gardens in Cape Town hosted the Global March for Elephants, Rhinos and Lions to help raise awareness for our threatened wildlife. One hundred and twenty countries came together for this world wide campaign to help save these three critically endangered species.

“More than 35,000 elephants are being killed every year so their tusks can be carved into ivory trinkets. A rhino is slaughtered once every 8 hours for its horn. Their only hope for survival lies in an immediate end to the ivory and rhino horn trade (both “legal” and “illegal”) and the chance to recover from decades of mass slaughter”.

To preserve the lives of these beautiful African creatures, the time has come to take an active role in putting an end to this slaughter trade.  It will be a sad day if the only available 3d image of a rhino, is at a movie theatre.

http://www.march4elephantsandrhinos.org/

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"Same same…but different": Trademarks, brands, and the fight against counterfeit goods that rages on

Counterfeit goods are goods that fraudulently imitate and use another’s brand name to lead consumers into believing that they are buying the genuine product (although some consumers may knowingly buy fake goods). Counterfeiting has become a lucrative underground business and is now a global concern. This year, the Organisation for Economic Co-operation and Development reported that the global value of all counterfeit goods increased to $1.77 trillion, with counterfeit products making up to 7% of world trade. This has led to the loss of approximately 2.5 million jobs worldwide.

Apparently, South Africa is regarded as one of the world’s fastest growing counterfeit industries. In 2011, the value of the South African counterfeit industry was estimated at approximately R362 billion.  To try to put a plug in the leaking ship, the Counterfeit Goods Act was introduced in 1997to protect trademarks, copyrights and intellectual property rights, and to restrict the sale of counterfeit goods. The Act prohibits dealing, selling, manufacturing, producing and exporting counterfeit goods. Persons found dealing in counterfeit goods are guilty of an offence and may be fined up to R5000 per article or face up to three years imprisonment or both, if they are a first time offender. Those guilty of a second conviction may be charged up to R10 000 per article or a maximum of five years imprisonment or both –not an insubstantial punishment.

WHAT YOU CAN DO:  If you, a brand owner, suspect that someone is dealing in counterfeit goods, you are obliged to lay a complaint with the Commissioner for Customs or Excise or a police official.  These inspectors may take steps  to terminate the unlawful act of dealing in those counterfeit goods, including seizing and detaining and destroying the counterfeit goods.

Brand owners must ensure that all their trademarks, like logos and brand names, are registered so that their intellectual property is properly secured. This is best done before the products are exposed to the public. Even the packaging design may be registered and protected.

Although it is up to brand owners to protect their intellectual property, consumers have a duty to buy responsibly- if the price is too good to be true, it’s probably fake!

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Events in Cape Town: The Muizenberg Festival 6 – 11 October 2015

The Muizenberg Festival begins today and runs for six days until Saturday 11 October.

The festival is an annual celebration of the eclectic suburb which aims to showcase its commitment to creative, collaborative, and community-led transformation. Highlights include the Creative’s Workshop (Tuesday 6 October), the Annual Muizenberg Dog Show (Saturday 10 October) and the Carnival Parade (Sunday 11 October). See the full program here.

Most of the events on the program are free to attend, but contributions –on a ‘pay as you can’ basis – may be made to support the festival’s projects.

For more information go to www.muizenbergfestival.co.za 

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Connections, a quarterly publication from Terralex

This quarterly publication from Terralex features articles authored by practitioners across the globe.

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Summonses, judgments and liquidations drop - some statistics showing trends in litigation by Louis Rood, Consultant at Fairbridges Wertheim Becker (Cape Town)

• Statistics South Africa reports that the number of civil summonses issued for debt in the country dropped by 11% from May 2014 to May 2015. This mirrors a steady decline in the number of civil summons issued for debt over the past four years. In May 2011, there were over 100,000 civil summonses issued for debt. By May 2015, this had dropped to 63,000. That is a significant decline.

• The number of civil judgments recorded for debt also dropped by 7.2% from May 2014 to May 2015. In May 2011, there were 45,000 civil judgments recorded for debt. Four years later in May 2015 this had dropped massively to 25,000 judgments.

• In the Western Cape, the number of civil summonses issued for debt actually increased from 9,760 in May 2014 to 11,421 in May 2015. For the same period in Gauteng however, the number of civil summonses issued dropped by 21% from 25,278 in May 2014 to 19,956 in May 2015.

• In the Western Cape, the number of default judgments in the Western Cape dropped by 20% from 4,095 in May 2014 to 3,267 in May 2015. For the same period, the number of civil judgments for debt in Gauteng dropped from 6,519 in May 2014 to 6,300 in May 2015.

• The number of liquidations in South Africa dropped by 20,6% in one year from June 2014 to June 2015. This also mirrors a steady decline of more than 50% over the past six years in the total number of liquidations, from 4,133 in 2009 to 2064 in 2014.

• Over the same six year period, the insolvencies of individuals have also dropped by 49% from 6,078 in 2009 to 3,102 in 2014.

What this means is that there is not less debt or fewer defaults. It mirrors a shrinking economy where there are less transactions taking place and as a result fewer failures to pay. The introduction of the National Credit Act has also probably had a negative influence, with less credit being granted.

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Right to mine coal in protected environment contested

The Centre for Environmental Rights (CER), a non-profit environmental law clinic, has instituted legal proceedings in the Pretoria High Court against the previous Minister of Mineral Resources, Ngoako Ramatlhodi, after he granted a coal mining right to Atha-Africa Ventures (AAV) to mine within the Mabola Protected Environment in Mpumalanga. The Minister granted the right eight months after Pinky Phosa, then the MEC for economic development, environment and tourism, declared the area a protected environment based on its great hydrological importance and high level of biodiversity.

Mabola covers 8 772 hectares between Wakkerstroom and northern KwaZulu-Natal and is a high-yielding water catchment area composed mostly of wetlands that feed the Limpopo, Tugela, Vaal, and Pongola Rivers. The area is also made up of endangered grassland ecosystems that support endangered species and has been classified as a Strategic Water Source Area, a National Freshwater Ecosystem Priority Area and an Aquatic Critical Biodiversity Area.

According to the environmental impact assessment report, AAV’s activities will dry up the wetlands, draw water from the subsurface water resources and pollute the streams that feed the rivers originating in the area. Seepage of acid mine drainage from the mine into the freshwater system is also highly likely and the damage done to the sensitive aquatic environment will be irreversible.

Catherine Horsfield, Attorney and Mining Programme Head at the CER, says: “The Minister’s decision to grant the right was unlawful because coal mining in such a strategically important area would result in unacceptable pollution, ecological degradation and damage to the environment. That being so, the mining right should never have been granted. Moreover, the fact that it is a protected environment means that commercial mining can only take place with the permission of both the Ministers of Mineral Resources and Environmental Affairs. No permission has been given by – or even sought from – the Minister of Environmental Affairs. Minister Ramatlhodi also disregarded the opposing views of the Department of Water and Sanitation and conservation agencies. On these bases we will argue that his decision should be set aside by the court.”

No doubt, the development of this litigation will be watched closely by several South Africans, as it progresses.

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Things to do on Heritage Day

Tomorrow is National Heritage day. Heritage day gives South Africans of all cultures the opportunity to celebrate their heritage.

As the oldest law firm in the Africa, Fairbridges Wertheim Becker is understandably proud of its heritage and always eager for any opportunity to celebrate it.

In 2013 our former chairman Louis Rood received the annual Heritage Ambassador award on Heritage Day from the national Heritage Council for his research and articles published on the heritage of the legal profession in South Africa.

If you’re struggling to decide how to celebrate, CapeTown Magazine.com have provided a list of things to do in Cape Town. http://www.capetownmagazine.com/things-to-do-for-heritage-day. And for those of you in Johannesburg: www.joburg.co.za/whatson.aspx.

(If you have ever been interested in the legislative mechanism which makes public holidays possible, click here. 

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Book Review: Street Law - Practical law for South Africans

 

Street law refers to the laws that affect ordinary people in their everyday life on the street. There is a huge need for people to be informed and educated about their rights and remedies, how the law affects them, and how they can use the law.

This welcome completely-revised third edition of twin companion manuals, 25 years after the pioneering first edition was published, explains in clear and understandable language the ins and outs of a broad spectrum of circumstances where people come into contact with the law.

• The Learner’s Manual provides essential information about the law, practical advice and useful answers to solving legal problems. Simplified meanings of more complex terms are listed, and the text is enlivened by a series of no less than 263 often witty and graphic illustrations by a talented team of artists – Andy Mason, Jeff Rankin, Grant Cresswell, Luke Molver, and Themba Siwela.

• The Educator’s Manual is a practical guide to conducting the exercises set out in the Learner’s Manual, designed to teach law to learners from a variety of backgrounds including law students, school learners, school educators, police officers, correctional services officers, security personnel, trade unions, employers, workers, community and civic organisations, family protection agencies, NGO’s and those involved in training such persons and groups.

The topics covered include consumer law, family law, employment law, criminal law, socio-economic rights and child justice. Many relevant issues are pertinently addressed, from cyber stalking, foster care, emergency medical treatment, legal aid, small claims courts, child pornography and powers of the police to debt counselling and many others.

This brace of remarkable books is a veritable compendium, a treasure trove of readily accessible and useful information with extraordinary potential to reach out to assist, and educate those who most need assistance but are ill-equipped and under-resourced when confronted with legal issues.

Publishers Juta, Street Law South Africa and all the contributors are to be commended on this outstanding publication. This is no dry and dusty encyclopaedia – the passion and commitment of all the contributors and their ability to connect with the lay ordinary reader is quite exceptional. Special mention must go to the General Editor, Professor David McQuoid-Mason, who in an illustrious academic career of over 40 years has been instrumental in pioneering the concept of street law not only in South Africa but in many countries around the world.

Review by Louis Rood BA, LLB (UCT) of Fairbridges Wertheim Becker

STREET LAW

Practical law for South Africans

Educator’s Manual (370 pages)
Learner’s Manual (696 pages)
(Third Edition)
Juta & Co (Pty) Ltd

www.jutalaw.co.za

by David McQuoid-Mason with Lindi Coetzee, Lloyd Lotz, Malebakeng Forere and Rowena Barnard

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Accessing a competitor's confidential information

When you submit information to the Competition Commission or Competition Tribunal, you may identify information that is confidential. ‘Confidential information’ means trade, business or industrial information that belongs to a business, has a particular economic value, and is not generally available or known by others. It is important that commercially sensitive information is protected from being exposed to the general public once it has been submitted to the Commission or Tribunal.

Competition authorities, however, depend on commercially sensitive material and confidential information in order to perform their function of promoting and maintaining competition in the country. This means that if during the course and scope of a matter before the Tribunal, a third party to the proceedings wishes to participate in the hearing, it may have access to the confidential information.

The Tribunal recently provided insightful guidance on this issue in the recent decision of the long-running cartel investigation involving Allens Meshco (Pty) Ltd and Cape Gate (Pty) Ltd. The Tribunal stated that legal representatives and economic advisors to a respondent in a matter must have access to confidential documents in order for justice to be achieved and for the hearing to be fair. The Tribunal suggested that when disclosing confidential information to a competitor at a hearing, access to the documents should be granted at a specific place in the presence of the owner’s legal and/or other representatives, the confidential documents should remain in the control of the owner and the people inspecting the documents should be prevented from removing or making copies of the documents. The Tribunal also suggested that confidentiality agreements should be signed by those inspecting the confidential information. If the confidentiality undertakings are breached, then the individuals could be severely sanctioned by their professional association, sued civilly for damages and criminally prosecuted.

Competition hearings do require access to confidential information but it is vital that this information is protected.

Read the decision here.

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A brief look at the dress code of the court

“And don’t try to impress me with your manner of dress,
Cause a monkey in silk is a monkey no less” – Rodriguez

The rules of the South African courts prescribe a dress code for legal practitioners who appear before the court. Black Robes are worn by both advocates and attorneys in the High Court. In the Magistrates’ Court, only attorneys are required to wear the robes when appearing.

The dress code, like the legal system, finds its origin in both the English and Dutch traditions. The macabre colour of the robe can be traced back to 1685 the year in which Charles II died. The English bar entered into a period of mourning which lasted longer than expected.

The advocates robe has a piece of triangular cloth attached to the left shoulder which is cut in two lengthways. Its origin is obscure but there exist two theories: The first is that, this was once a money sack for brief fees. According to some, it is divided in half to create two segments, one for gold coins, and the other for silver. The theory is that since advocates were not openly paid for their work, clients made a payment into counsel’s pocket, literally behind their back, to preserve their dignity. The idea was that, if advocates could not see how much they were being paid, the quality of their advocacy in court could not be compromised.

In South Africa a presiding officer’s dress is determined by the nature matter; if the case is a civil, the judge will wear black. If criminal, then red. Constitutional Court Justices have worn Green Robes since February 1995 when the court was formally opened.

To see some of the Regalia of judges throughout the word visit this page http://www.jjmccullough.com/judges.htm

For a more in depth discussion on the history of South African court dress see this article by L Kent. http://www.bdlive.co.za/opinion/2012/11/14/judicial-dress-codes-are-due-for-a-makeover

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Is an Arbitration a legal proceeding for the purposes of the moratorium in Business Rescue proceedings

Once a company is placed into business rescue, legislation provides for a general moratorium on the institution of, and continuation of legal proceedings against the company or its property. This moratorium has some exceptions. For example, one may proceed against the company with the consent of the business rescue practitioner, or with the leave of the court.

The question raised in the case was whether or not an arbitration falls within the definition of a  ‘legal proceeding’.  The Supreme Court of Appeal decided the question in the affirmative, making reference to the principles of international law –in jurisdictions that have similar company rescue provisions.  This decision will no doubt be welcomed in this country, where the rising trend is to arbitrate rather than litigate.

Read the judgment here: http://www.justice.gov.za/sca/judgments/sca_2015/sca2015-112.pdf

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Urgent interdict suspending payment to SARS granted despite 'pay now, argue later' principle

When there is a dispute raised by a taxpayer about the SARS’ assessment of a tax due to it, South African tax law follows the ‘pay now, argue later’ principle. According to this principle, if a taxpayer has a dispute, the payment of that tax is not suspended ending resolution.

The Tax Administration Act, however, allows taxpayers to apply to SARS to suspend the payment of a disputed tax, pending the outcome of the dispute. If SARS refuses the suspension, the taxpayer may opt to have the decision reviewed in terms of the Promotion of Administrative Justice Act. The problem with this, is that the review often takes several months.

Another option for taxpayers is to approach a court and apply for an urgent interdict to suspend the payment. Urgent interdicts are notoriously difficult to obtain in these circumstances. On 31 August, however, the Pretoria High Court granted an urgent interdict against SARS, preventing it from collecting over R 1 billion of tax, pending a review of the assessment. This rare judgment shows that it is possible –depending of course on the circumstances – to both “pay” and “argue” later.

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United Nations adopts its first resolution on wildlife trafficking

The General Assembly of the United Nations unanimously adopted its first resolution on ‘tackling illicit trafficking in wildlife’. The resolution is a historic step towards tackling the organised criminal networks who profit from the illegal killing of some of the world’s most iconic species.

The UN Secretary General has now been tasked with presenting an annual report on global wildlife crime and countries’ implementation of the resolution, together with recommendations for further action. The resolution urges Member States to make illegal trafficking in protected species of fauna and flora involving organised criminal groups a “serious crime” and to harmonise national legislation.

In South Africa, the National Environmental Management: Biodiversity Act of 2004 prohibits anyone from carrying out a restricted activity involving any threatened or protected species without a permit. This includes hunting, catching, killing, exporting, importing, possessing, growing, breeding, trading in and translocating or moving any living specimen of a listed or threatened species.

South African species that are particularly vulnerable to poaching are elephants, lions, abalone, tortoises, orchids, cycads and, most notably, rhinos. The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) reported that, in 2014, over 1 215 rhinos were poached in South Africa, which translates to one rhino killed every eight hours.

Hopefully the UN resolution will spark the firm and concerted international action desperately needed to combat poaching and those who profit from it.

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Verbally announcing an intention to leave, and then leaving, interpreted as resignation

It is not uncommon for heated exchanges to occur in the workplace. Employees should have regard to their conduct in light of the latest judgment handed down by the Labour Court in the matter of Mnguti v Commission for Conciliation, Mediation and Arbitration and Others.

During the course of an argument, the employee announced to his employer that he “wanted to leave”.  After a further exchange between the parties the employee left, without submitting a written resignation. The courts have held that a verbal resignation can be binding provided the employee evinces a clear and unambiguous intention not to continue the employment relationship, either by words or conduct.

In the circumstances the employee referred an unfair dismissal matter to the CCMA  – where the Commissioner found that there was no dismissal and therefore, that the CCMA lacked the necessary jurisdiction to entertain such. On review, the Labour Court confirmed that the employee had in fact resigned and that no dismissal had occurred..

Read the judgment here:-

http://www2.saflii.org/za/cases/ZALCJHB/2015/277.html

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Call for submissions: Taxation Laws Amendment Bill and Tax Administration Laws Amendment Bill

Taxation Laws Amendment Bill and Tax Administration Laws Amendment Bill

National Assembly’s standing committee on Finance has called for written submissions by 14 September 2015.

This is in preparation for Parliament’s public hearing for comment on the 2015 Taxation Laws

Amendment Bill and the Tax Administration Laws Amendment Bill. The hearing is scheduled to take place on the 16th of September.

A presentation held by the National Treasury and SARS on 4 August 2015 provided a summary of the proposed amendments, and reiterated that most of the proposed changes reflect the 2015 Budget Speech, but that some proposals made by the Minister of Finance have fallen away or have been postponed after consultation.

The presentation can be found here, courtesy of Legal Brief.

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Interdict to block Springboks from Rugby World Cup abandoned

The application to interdict the Springboks from the Rugby world Cup was abandoned on Thursday last week. The application, bought by the Agency for a New Agenda (ANA) against the South Africa Rugby Football Union (SARFU) and the Minister of Sport, ambitiously asked the court for an order that the passports of the 31 man squad be surrendered, and that a commission of enquiry be launched in order to address the lack of transformation in South African Rugby.

While the merits of the application are interesting and worthy of further discussion, so too is the legal mechanism on which ANA sought to rely.

Generally, to be granted interdictory relief, one must show at the very least a clear right to the relief sought; an actual or threatened invasion of some other right; and the absence of another suitable remedy. The court always has discretion to refuse an interdict, even if all the requirements have been met.

Taking this all into account, it would have been interesting to see, failing settlement, whether the papers in this application were able to make a case meeting these high thresholds. 

 

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Casual day: No more of the dark winter months. It's time to celebrate the first official month of Spring

On  4 September 2015,  it is the annual Casual Day fundraiser, which funds research for children with disabilities.  Don’t forget to purchase your Casual Day Sticker, get into your casual gear on Friday and share your photos on their social media sites mentioned below. The theme this year is “SpringIntoAction”.

“Child disability is a neglected and serious national problem, yet the scale of the problem is not documented and hence not represented on a policy and services level,” says Therina Wentzel, National Director of the National Council for Persons with Physical Disabilities in South Africa (NCPPDSA).

For further details go to http://www.casualday.co.za/

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Labour Court confirms a tough test for condonation

To review certain conduct in the Labour Court, the Court’s rules require that applications be brought within very strict timelines.  In this case, a review was launched some eight months late.  Being so out of time, the applicant simultaneously applied for the Court’s condonation  -colloquially, legal forgiveness – for the late filing.

In his reasons for judgment, the Acting Judge opined that the rules of the Court  strive to provide for effective and expeditious resolution of labour disputes. As such condonation is not granted as a matter of course.

As such, in instances where no reasonable and acceptable explanation for the delay exists,  the consideration of the prospects of success are immaterial. Whereas, on the flip side, where no prospects exist, no matter how compelling the explanation for the delay is, the granting condonation would be an exercise in futility.

As such, the granting of condonation has become the exception and not the rule.

The Labour Court’s tough approach is most welcome.

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As anticipated, Ashley Madison data leak results in a Class Action Lawsuit.

The company behind the AshleyMadison.com website – and latest victim of an online hack – faces a $760 million (approximately R10.640bil) class action brought by users of the website ‘outed’ in the hack.

AshleyMadison.com essentially facilitates extra marital connections between users. As a result of the hack 37 million users have had their personal data, including names and email addresses, made available online.

See the full article here.

While the mechanisms for class action lawsuits do exist in South African law, they are by no means as frequent as in the US, where they have become somewhat common place with specialist ‘class action’ firms that fund the litigation, often with lucrative contingency fee agreements well in place.

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New European Union inheritance laws should prompt reviews of wills

A new succession law came into effect throughout the European Union last week. In terms of this rule, the law of the country where the deceased was a habitual resident will govern succession to their estate as a whole, including any assets held in different European jurisdictions.

For example a woman in the UK with a property in France would have been obliged to leave it to her husband and children under French forced heirship rules. Under the new rule, she could instead choose to apply UK law to the property, which would allow her to leave the house to her brother.

The intention of the rule is to simplify a frequently encountered and complex area of international law.

See full article at http://www.lawgazette.co.uk/law/new-eu-inheritance-law-should-prompt-wills-reviews-say-experts/5050595.fullarticle

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Genetic-link requirement in surrogacy declared unconstitutional

This month, the Pretoria High Court struck down the genetic-link requirement in surrogacy, declaring it unconstitutional.

Under the Children’s Act of 2005, surrogacy is only allowed when at least one of the commissioning parents contributes an egg or sperm.

If there was no genetic link, there could be no surrogacy agreement. This was unlike in vitro fertilisation (IVF), where no genetic link is required.

The Court found that the genetic-link requirement in surrogacy infringed the Constitutional rights to dignity and equality. Judge Anneli Basson emphasized that “a family cannot be defined with reference to the question whether a genetic link between the parent and the child exists. Our society does not regard a family consisting of an adopted child as less valuable or less equal than a family where children are the natural or genetically linked children of the parents. A family can therefore not be defined by genetic lineage.”

As orders of constitutional invalidity must be confirmed by the apex Court on these matters, the Surrogacy Advisory Group are to approach the Constitutional Court to confirm the High Court order.

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Recent Indonesian addition to the TerraLex Network, Lee Tai & Partners

We are pleased to welcome Lee Tai & Partners to the Terralex Global Network of Lawyers of Excellence.

This firm “has been recognized by Corporate INTL in 2013, as the Full Service Law Firm of the Year in Taiwan.  They have more than a decade of experience…an in-depth understanding of the demands and concerns of the legal market…[and] focuses on assisting multinational clients with joint venture, strategic alliance, distribution, licensing, real estate, employment, and merger and acquisition matters in the region.”

 http://www.terralex.org/publication/pa20a4f59d2/terralex-announces-new-member-firm-in-taiwan

 For more on TerraLex Members and news, go to http://www.terralex.org/

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FWB Consultant, Monty Hacker, does SA proud at World Masters Athletics Championship

Our very own Monty Hacker, represented South Africa in the World Masters Athletics Championship in Lyon, France earlier this month and did exceptionally well.

The WMAC took place between the 4th and 16th of August 2015, where over 114 countries were represented and approximately 8000 athletes competed.

Monty competed against 25 others in his Masters category, in the age group 80 – 84. In the finals he took first place in the 200m sprint in a record breaking time of 31,82 seconds, and third in the 100m sprint.

This is truly a remarkable achievement Monty!

Monty Hacker is a consultant at FWB Attorneys who has been in practice for 54 years. His areas of experience include general litigation with a focus on insolvency and liquidations. Monty is well known for insolvency law interrogations and has extensive experience in corporate and commercial work, administration of deceased and insolvent estates and the administration of trusts. In addition to his busy practice, Monty sits as Arbitrator in the Court of Arbitration for Sports (CAS), and was formerly the Chairperson of the South African Institute for Drug Free Sports which adjudicates doping cases both in South Africa and internationally.

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Is conciliation at the CCMA a pre-requisite to institute action in the Labour Court?

The Labour Court (Pillay v Automa Multi Styrene (Pty) Ltd ) recently confirmed that one cannot approach that Court without having first attempted conciliation.

Conciliation is the first regulated step provided for parties to settle a matter. It often limits legal costs and provides a conciliatory platform for parties to resolve their issues. Only if the conciliation fails may the matter be referred to the Labour Court or arbitration at the CCMA – depending on the nature of the dispute.

Failure to attempt conciliation first may form the basis for a finding that the referral to the Labour Court was premature, resulting in a dismissal of the entire case.

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Progress Report from the Davis Tax Committee and Finance Minister’s comments on South Africa’s Tax system

Last week, the Davis Tax committee provided an interim report to Parliament on their inquiry into the role of the South African tax system. Judge Denis Davis referred to a study by the World Bank who positively confirmed South’s Africa’s tax system, as “progressive and pro-poor.” Davis spoke of the difficulty in “closing the inequality gap” due to “socio-economic challenges, the electricity shortage, and an inherited system of unequal distribution of wealth”.

Davis noted that although our tax system has assisted in minimising this inequality gap, it would not be able to solve all of South Africa’s problems. “There is higher tax morality when people know their money is being well spent,” he explained, expressing the need to eradicate corruption. “People need to pay their fair share, it is as simple as that,” he said, but that “You cannot keep taxing at the lower end, you just cannot… people are battling.”

At the Bureau for Economic Research Annual Conference, Minister Nhlanhla Nene referred to the Davis Tax Committee and negative feedback recently received by those individuals who are likely to be effected by the proposed changes. He noted that there is “no ad hoc approach to implementing major tax changes” and that “tax policy and tax legislation need to provide certainty to business. For this reason, tax policy needs to be boring and where new taxes come into being, like the carbon tax or mining royalty, we take a deeply consultative approach over many years before we legislate and implement the new measures.”

See https://sait.site-ym.com/news/236768/Nene-says-SA-tax-processes-are-by-necessity-boring-.htm and https://sait.site-ym.com/news/236742/Current-tax-system-not-one-size-fits-all-Davis-.htm, for more.

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Indian Government seeks damages from Swiss food giant after banning Maggi noodles for containing unsafe levels of lead.

Earlier this month the Indian Government took Nestle to the country’s highest consumer court, the National Consumer Disputes Redressal Commission (NCDRC).

The State is suing the Swiss food conglomerate for 6,400 million rupees (R1 268 784 800) in damages.

This claim is based on laboratory results which revealed that the popular brand, Maggi Noodles, contained higher levels of lead than were legally permissible. MSG was also found in the product but not listed as an ingredient.

If Nestle loses the case, it has said that it would destroy $50m worth of Noodles.

See full article at http://www.aljazeera.com/news/2015/08/india-sues-nestle-100m-food-safety-maggi-noodle-150812071954193.html

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Market division: the penalties and remedies

The Competition Act prohibits agreements that divide markets by allocating customers, suppliers, territories, or specific types of goods or services. For 30 years, two locksmith companies had agreed to restrict their business to the Free State and Northern Cape respectively so that neither would face competition from the other in these provinces.

In July 2015, the Competition Tribunal (Tribunal) published its reasons for prohibiting this agreement and applied the new formulae prescribed in the Guidelines for Administrative Penalties for Prohibited Practices, which took effect on 1 May 2015, to determine the appropriate penalty for their contravention. Despite the potential market division, no profits were actually derived from the conduct and the Competition Commission could not provide any proof that the conduct had an exclusionary effect. Observing that the locksmith market is also largely based on trust and customers will usually use the same locksmith, the Tribunal reduced the penalty amount by 90% and provided that if the companies placed weekly advertisements of their businesses in newspapers which circulate both in the Free State and Northern Provinces, a further 50% would be taken off the penalty amount. This was a practical means of remedying the exclusionary effect of the market division.

Read the judgment here: http://www.comptrib.co.za/assets/Uploads/017731-signed-version4.pdf

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Attorneys' Admission Examinations: 18-19 August

This week many candidate attorneys have been hard at work preparing for the Law Society’s Attorneys’ Admission Examinations. After months of weekly Practical Legal Training lectures hosted by the Legal Education & Development branch of the Law Society of South Africa, candidate attorneys will have the opportunity to write exams covering civil and criminal court procedure, personal injury claims, administration of deceased estates, drafting of wills, succession, bookkeeping and the duties and ethics of being an attorney. Best of luck to all those writing on 18 and 19 August, and the Fairbridges Wertheim Becker crew:  Palesa Mohale, Prelene Naicker, Nosiphiwo Qwabi, Bilqees Parker, Julia Rushton, Graham Houston and Richard Hutchinson.

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City of Cape Town to provide free Wifi to commuters

The City of Cape Town has issued a tender for a service provider to install and operate Wi-Fi zones on MyCiti busses. The service will be free to all passengers and is expected to include a minimum of 50mb per day. The City hopes to have the Tender process completed by the end of the year, and that the service will become available in 2016.

See full article here.

Similarly, Cape Town Taxi ranks are also in line to receive free WiFi . Project Isizwe whose primary aim is to provide free WiFi to South Africa, have announced that commuters using both the Gugulethu and Khayelitsha Taxi ranks will also be in line to receive free WiFi in the near future.The organisation has already succeeded in rolling out a similar project in the City of Tswhane and has outgoing projects in rural parts of the Eastern Cape. Isizwe offer commuters a minimum cap of 250mb at a speed of 15mb per second.

These projects come at a time where a number of major international organisations have announced plans to provide internet access to the entire planet. Google Space X and OneWeb are two such examples. Current estimates are that half the world’s population will have access to the internet by 2018.

Providing internet access to more people theoretically opens up untapped markets, resources and opportunities. The implications for the business sector are huge.

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TB Davie Memorial Academic Freedom Lecture at the University of Cape Town

UCT hosts the Memorial Academic Freedom Lecture, this Thursday, 13 August 2015, at Lunch time, in the Smuts Dining Hall, Upper Campus.

Topic: Free speech in the age of identity politics

Presented by: Kenan Malik

“The rise of identity politics in recent decades has transformed the landscape of free speech. Free speech is no longer seen as a universal good, while censorship is often seen as a progressive act, a means of protecting vulnerable people and social groups without power, and a tool with which to cut the powerful down to size. In this year’s TB Davie Memorial Academic Freedom Lecture, Kenan Malik examines the impact of identity politics on ideas of free speech, challenges the idea of censorship as a progressive act, and, in an age in which many embrace the politics of identity, remakes the case for free speech as a universal good.”

To make a booking, go to http://www.uct.ac.za/events?e=TB_Davie_Lecture

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Women's day

“Women’s Day is celebrated in many countries around the world. It is a day when women are recognized for their achievements without regard to divisions, whether national, ethnic, linguistic, cultural, economic or political. It is an occasion for looking back on past struggles and accomplishments, and more importantly, for looking ahead to the untapped potential and opportunities that await future generations of women.”

http://www.un.org/womenwatch/feature/iwd/history.html

There are so many phenomenal women working in science, tech, engineering and maths in South Africa who are making great strides, representing the power women possess and are paving the way for other young girls to follow in their footsteps.  – http://www.htxt.co.za/2014/08/09/womens-day-meet-three-young-sa-women-doing-amazing-things-in-stem/

Read about women entrepreneurs in South Africa and how they turned their venture into a successful business. – http://www.entrepreneurmag.co.za/category/advice/women-entrepreneurs/women-entrepreneur-successes/

Happy Women’s Day, 9th July 2015

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Nkunzi Milkway and Clover merger prohibited by Competition Commission

In December 2014, the Competition Commission prohibited Clover S.A. (Pty) Ltd from merging with Nkunzi Milkway (Pty) Ltd. Clover is a branded consumer goods company that sells a range of dairy and non-dairy products in South Africa and certain other African countries. Nkunzi primarily manufactures fresh dairy products including Ayrshire, organic and lactose-free items and derives most of its revenue from the sale of fresh dairy products to Woolworths. Post-merger, Clover would have sole control of Nkunzi.

One of the concerns raised about the potential merger was that there was the possibility that Clover would increase the number of products it supplies to Woolworths which would compromise the businesses of smaller suppliers/processors of dairy products because of Clover’s relative position in the market. Competitors submitted that there is a shortage of Ayrshire milk in the country and it was likely that Clover would offer the competitors’ independent suppliers of Ayrshire milk a better price in order for Clover to increase its own supply to Woolworths. This would result in the competitors not being in a position to supply Woolworths and they may lose Woolworths as a customer.

There was also the concern that Clover may not pay farmers the correct value for the Ayrshire milk that makes it sustainable and profitable for producers to continue to breed Ayrshire cows. This would be anti-competitive and lead to more farmers exiting the market. The Competition Commission therefore prohibited the merger, as it was likely to lead to a substantial prevention or lessening of competition in the market for the manufacturing and supply of dairy products and raise public interest concerns in the market for the procurement of milk.

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Validity Of Automatic Dismissal Clauses

SATAWU (on behalf of DUBE) took Fidelity Supercare Cleaning Services Group (Pty) Ltd, to Court recently. Several persons, employed by Fidelity to provide cleaning services to Wits University, brought the action for what they perceived to be the unlawful termination of their employment agreements.

What led to the litigation was the following: Wits University had concluded a service agreement with Fidelity, in terms of which Fidelity would provide cleaning services to it.Pursuant to the conclusion of this agreement, and as is quite customary, Wits engaged the services of several employees on the basis that the contracts would come to an end either on date of retirement University or the date the contract between Fidelity and the University terminated, whichever occurred first.

Sometime thereafter, Wits cancelled its agreement with Fidelity, and later equivocated and retained Fidelity’s services, this time on a much smaller scale. Fidelity then invited all affected Employees to apply for the available positions at Wits University, which invitation they neglected to accept.

This matter was then referred to Court on the basis that the employees were dismissed for operational reasons without severance pay. The court had to decide whether the clause – stipulating the termination based on the occurrence of an event -was valid, which it confirmed in the affirmative.

This finding is in line with Item 11 of the Code of Good Practice which provides ‘If an employee either accepted or unreasonably refused to accept an offer of alternative employment, the employees statutory right to severance pay is forfeited’. In cases such as these, termination is by operation of law.

This judgment aligns itself with the employment demands of companies whose employee requirements are dynamic, particularly those providing services on a fixed term contractual basis.

Read the judgment here:

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FWB Delegates at Terralex Global Meeting in Munich

Peter Watts, Bob Groeneveld and Louis Rood represented Fairbridges Wertheim Becker at the TerraLex Global Meeting in Munich, Germany in June2015,joining almost 300 delegates and guests from over 60 countries and 110 member firms.

TerraLex is one of the largest worldwide networks of leading, independent law firms. The members of TerraLex provide each other with access to expertise from around the globe and local connections necessary to provide seamless service to clients no matter where their needs arise.

Lawyers came from as far afield as Ecuador, Hong Kong, Iceland, Japan, Paraguay, Mexico, Philippines, Russia, Senegal and Vietnam.  Some firms sent team of delegates – 4 from Austria, 7 from China, 5 from Czech Republic, 7 from England, 5 from France, 5 from Norway, 4 from Poland, 5 from Spain.  The host firm SKW Schwarz has offices in Munich, Berlin, Dusseldorf, Frankfurt and Hamburg.

Fairbridges Wertheim Becker is the exclusive South African member of TerraLex.

As always, the calibre of the lawyers and their firms was impressive and we are certainly privileged to have access for ourselves and our clients to the over 17,000 lawyers of the TerraLex member firms.

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FWB receive PMR.africa Diamond Arrow Award

Louis Rood, represented Fairbridges Wertheim Becker to receive the PMR.africa Diamond Arrow Award 2015 awarded to our firm, as first overall winner among law firms in the City of Cape Town and Cape Peninsula Regional Survey.

This is based on a random, regional sample of over 100 respondents comprising of CEOs, MDs, business owners, company directors and managers, and senior local and national government officials based in the City of Cape Town and Cape Peninsula Regions. Our winning rating was 4.3 out of 5 (86%). This is the first time we have received an accolade in the name of Fairbridges Wertheim Becker. Long may that continue. Congratulations!

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Further updates from the Davis Tax Committee and its interim report – Estate Duty

While the initial proposal and expectation in regards to estate duty was that it be removed from our current tax system, the Davis Tax Committee has recommended in its recent interim report on estate duty, that it be retained, subject to a few changes. The focus was on estate duty avoidance, use of trusts, inter-spouse bequests, donations tax, capital gains tax, retirement funds and abatements.

The Report recommends an increase of the primary abatement of R3.5 million to R6 million, to accommodate inflation, but then suggests that all inter-spouse exemptions and roll-overs should either be withdrawn or limited.

In addition, the committee has suggested that trusts should be taxed as separate taxpayers, instead of our current position which places the tax duty on beneficiaries. This stems from the committee’s findings that where “the attribution principle, which underpins taxation of a beneficiary in a trust, was intended as an anti-avoidance principle to prevent a trust from being used as an income splitting device”, taxpayers are now diverting income away from the trusts and effectively making use of lower tax rates. It is further recommended by the committee that distributions of foreign trusts be taxed as income, in the hopes that this will “discourage offshore trust formation”.

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What is the small claims court?

Unfortunately, civil disputes are a fact of daily life; accounts are left unpaid; reckless drivers smash into parked cars and neighbours are forced to cut down thorn bushes that have encroached upon their lovely lawns. What is perhaps more unfortunate is the cost of legal advice and civil litigation.

Anyone who has been slighted in one of the instances above may think that it is not worth their while to approach a lawyer. And in most cases they would be right. The costs of litigating in these matters far outweighs the possible benefits.

In 1985 the Small Claims Court was established in order to address this particular problem. The State needed a way to increase access to just outcomes in small civil disputes.

As of 1 April 2015 if the amount in dispute is R15 000.00 or below, it will qualify as a small claim that can be brought before the court. And if the Plaintiff’s claim exceeds R15 000, the Plaintiff can surrender the difference in order to bring it within that limit.

No legal representatives are permitted in the court hearings. The Plaintiff, the person bringing the claim, and the Defendant are on their own. In this way costs are kept to a minimum.

The presiding officer is known as a commissioner. The position is unpaid and is ordinarily filled by a lawyer as a way to meet their mandatory community service hours.

There are 345 courts in the country and all can be found here.

For a more in depth discussion on the the small claims court and the process  see Bert van Hees’ full article.

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Disbarring representatives of Financial Service Providers

Representatives of Financial Service Providers (FSPs) render financial services to clients for or on behalf of a FSP. This may involve selling financial products such as insurance policies and unit trusts to the public. According to the legislation governing FSPs (Financial Advisory and Intermediary Services Act 2002), a FSP must ensure that its representatives meet the fit and proper requirements and are competent to act. It is imperative that representatives are not dishonest or lack integrity.If a FSP does not satisfy this requirement, it may be guilty of an offence and be liable on conviction to a fine not exceeding R10 million or to imprisonment not exceeding 10 years or to both such a fine and imprisonment.

Last month, in Financial Services Board v Barthram, the Supreme Court of Appeal (“SCA”) held that if a person who is debarred by a FSP; is also debarred from working in the financial services industry and are prevented from rendering financial services in order to protect the investing public. Therefore, a representative who is dishonest and acts without integrity, may be debarred by his or her employer and the Registrar of FSPs on an industry-wide basis.

The correct due process before any disbarment is critical, however, and before a FSP may disbar a representative, the FSP must provide the representative with any necessary information and allow for a reasonable time to make representations.

Read the judgment here: http://www.justice.gov.za/sca/judgments/sca_2015/sca2015-096.pdf

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Court rules on the Constitutionality of emolument attachment orders

Judgment was handed down by Judge Desai, last  Wednesday, in the Western Cape High Court, in favour of a group of consumers, joined and represented by the University of Stellenbosch’s Legal Aid Clinic, where deductions from those consumers’ salaries were found to be invalid and unlawful.

These orders, known as emolument attachment orders (“EAO”), and regulated under the Magistrates Court Act  32 of 1944 (“the Act”), allows for the attachment of a judgment debtor’s salary or wages, obliging his or her employer to pay to the judgment creditor, instalments out of his or her earnings, to make good on the debt due, including all legal costs incurred.

The provisions in the Act, dealing with EAOs, authorise the Court to may make such an order as it deems “just and equitable”. In this instance, the clerk of the court issued these orders without any evaluation of the debtors economic circumstances, whether they were able to afford these deductions, and whether such an order would be just and equitable in the circumstances.

Judge Desai noted in his judgment that,

“It is common cause that most of the orders were obtained from courts located a great distance from where the debtors resided and worked. The debtors’ rights to access the courts and enjoy the protection of the law were clearly compromised in these instances.

The right of access to courts is fundamental to the rule of law in a constitutional state…respondents are obtaining judgments and EAOs against the applicants in courts far from their homes and in places they could not reach. The right to access the courts was seriously jeopardised, if not effectively denied.

It seems to be firmly established in international law that states have a duty to protect their citizens against the abuse of human rights by business enterprises in their territory. Where such abuses do occur, states have a duty to provide victims with an effective remedy”

Judge Desai thus found that the relevant sections of the Act, dealing with EAOs are constitutionally invalid.

“Section 65J(2)(b)(i) and section 65J(2)(b)(ii) of the MCA are in the circumstances constitutionally invalid to the extent that they allow for EAOs to be issued by a clerk of the court without judicial oversight. This is so both with regard to international law and to the current jurisprudence of the Constitutional Court. “

He further declared that section 45 of the Act, which provides parties with the option to consent to the juris
diction of the Magistrates Courts, cannot apply to agreements that fall within the scope of the National Credit Act, and cannot give creditors the discretion to obtain judgment and EAOs far away from where the debtor resides or works. This provision is often found in standard agreements.

“It is declared that in proceedings brought by a creditor for the enforcement of any credit agreement to which the National Credit Act 34 of 2005 applies, section 45 of the Magistrates’ Courts Act does not permit a debtor to consent in writing to the jurisdiction of a magistrates’ court other than that in which that debtor resides or is employed.”

To view this judgment, go to http://www.saflii.org/za/cases/ZAWCHC/2015/99.html

“I think this sends a strong message to those who continue to engage in extractive financial practices that impoverish the poor, exploit their lack of financial literacy, and make money on the backs of the poor.” –  Elroy Paulus and http://mg.co.za/article/2015-07-09-victory-for-consumers-as-court-rules-against-salary-deductions 

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The Competition Commission approves of the Vodacom/Neotel merger

Earlier this month, the Competition Commission approved Vodacom’s decision to acquire Neotel for R 7 billion. The result :Neotel will be a wholly-owned subsidiary of, and under the control of Vodacom.

The Commission found that the merger is likely to substantially lessen or prevent competition in the mobile services market as Vodacom already holds the dominant position in the market with roughly 30 million subscribers.

The merger will benefit Vodacom, the Commission has found, as competitors are unlikely to match Vodacom’s network speed, capacity and mobile offerings.

The Commission has as a result recommended to the Competition Tribunal that the merger be approved. This approval, as expected, is subject to conditions, some of which are that Vodacom will not use the Neotel spectrum for wholesale or retail mobile services to any of its customers for two years, and that Vodacom will not retrench any of the Neotel employees as a result of the merger. As for transformation, within 24 months of the approval date, Vodacom must ensure that its share capital held by Black Economic Empowerment (BEE) shareholders will increase by R1.4 billion.

Read the Competition Commission’s media release on http://www.compcom.co.za/wp-content/uploads/2015/01/Commission-recommends-approval-of-Vodacom-Neotel-merger-with-conditions.pdf 

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Book Review: International Tax Law - Offshore Tax Avoidance in South Africa

“The avoidance of taxes is the only pursuit that still carries any reward”

– John Maynard Keynes (1883 – 1946)

This significant new publication in the already crowded tax–commentary sphere comprehensively examines tax avoidance schemes employed by South African residents in an international context.

Difficult international tax concepts are logically explained. The effectiveness of South African legislation in countering offshore tax-avoidance schemes is critically analysed, and compared in detail with similar provisions in the United Kingdom and United States of America.

The recommendations of international organisations such as the Organisation for Economic Co-operation and Development (OECD), that seek to prevent international tax avoidance, are considered, as well as the role of tax havens in encouraging tax avoidance.

The subject matter is extensive and dealt with in depth. This includes curbing tax avoidance that results from investments in offshore “protected cell companies”, in derivative financial instruments, in offshore trusts, transfer pricing, cross-border leasing transactions, and the abuse of tax treaties. The text is supported by a wealth of authorities, an extensive bibliography, references to South African and foreign legislation, domestic and international case law and academic commentary.

This impressive work will undoubtedly prove to be an invaluable resource to tax practitioners, tax administrators, legislators, financial advisors, and investors. The distinguished author Professor of Mercantile Law at UNISA, Annet Oguttu, LLB, LLM, LLD (Tax Law), H.Dip International Tax Law, and publishers Juta are to be commended for the production of a world-class treatise on this increasingly important and complex aspect of economic and fiscal evolution.

Review by Louis Rood BA, LLB (UCT) of Fairbridges Wertheim Becker.

International Tax Law – Offshore Tax Avoidance in South Africa

by Annet Wanyana Oguttu

(822 pages)

Juta & Co Ltd

www.jutalaw.co.za

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Eastern Cape Liquor Act upheld by the Constitutional Court

Shoprite Checkers (Pty) Ltd took government and the Eastern Cape Liquor Board to Court to challenge the constitutionality of the provisions of the ‘new’ Eastern Cape Liquor Act, introduced in 2004.

According to the Act, commercial trading licenses which allow the selling of wine in grocery stores (‘grocers’ wine licenses’) would lapse 10 years after the commencement of the Act (2014).  Shoprite Checkers would be forced to apply for the standard off-consumption liquor license, entitling them to sell all types of liquor. The question posed before the Constitutional Court was whether grocers’ wine licenses constitute property under Section 25 of the Constitution, and if so, whether the legislative termination of the license would amount to an ‘arbitrary deprivation of property’. A novel argument to say the least.

 Shoprite Checkers succeeded in the High Court, where it was held that certain provisions of the Eastern Cape Liquor Act were constitutionally invalid. Confirmation of this order was therefore sought in the Constitutional Court.

 The Court found that although a grocer’s wine license constitutes property under Section 25 of the Constitution, there was no arbitrary deprivation of this property as Shoprite had an opportunity to convert this license so that it would fall within the ambit of the Eastern Cape Liquor Act, and it chose not to.  In the words of the Court:

 “Objectively viewed, the change in regulatory regime brought about by the Eastern Cape Act did not extinguish any fundamental rights of holders of grocer’s wine licences or fundamental constitutional values. Rationality would thus be sufficient reason to avoid a finding of arbitrariness. And, on the facts on record before us, it is quite rational to change the regulatory regime of liquor sales to provide for simplification in the licensing system.” [at para 83 of Froneman J’s judgment]

 Judgment found at –  http://saflii.org/za/cases/ZACC/2015/23.html

 Incidentally,  the Eastern Cape is the only province that chose to terminate the grocer’s wine license.

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Ostrich farmer takes on Standard Bank over securitised loan

An Eastern Cape farmer and his legal team have deployed an unusual strategy to defend an action for repayment of a loan instituted by Standard Bank.

Davenport, the farmer in question, has placed a securitisation audit before the Grahamstown High Court which aims to prove that the loan has been sold to a Taiwanese Bank.

Securitisation refers to the process where assets (such as contractual debts or residential mortgages) are transformed or bundled into financial instruments through a process of financial engineering. These instruments are then sold to investors who expect returns from the recovery of the principal debt and interest.

It would seem that Davenport’s argument is that once the securitisation has taken place, the bank loses the right to enforce the loan. In other words, Standard Bank has no legal standing to bring the matter court. This argument is backed up by United States jurisprudence, but has yet to be argued in South African courts.  We watch with interest.

Full article available at: http://news.acts.co.za/blog/2015/06/ostrich-farmer-from-eastern-cape-shows-court-his-mortgage-loan-is-now-in-taiwan

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Constitutional Court confirms no more delictual claims in respect of acts of adultery

The Constitutional Court has confirmed the ruling of the Supreme Court of Appeal (SCA) that the act of adultery by a third party lacks wrongfulness for the purposes of a damages claim, in particular that of loss of companionship of the spouse.

The husband instituted legal proceedings against the third party for damages on the basis of an adulterous relationship between the third party the husband’s former wife. The husband was successful in the High Court.

The third party appealed to the SCA, where a claim based on adultery was abolished. The husband appealed to the Constitutional Court.

Justice Madlanga concludes that the potential infringement of dignity on the innocent spouse must be balanced with the right to privacy and freedom of association:-

“Nevertheless, this potential infringement of dignity must be weighed against the infringement of the fundamental rights of the adulterous spouse and the third party to privacy, freedom of association and freedom and security of the person. These rights demand protection from state intervention in the intimate choices of, and relationships between, people. This must be viewed in light of current trends and attitudes towards adultery both nationally and internationally. These attitudes also demonstrate a repugnance towards state interference in the intimate personal affairs of individuals.

 I am led to the conclusion that the act of adultery by a third party lacks wrongfulness …That is what public policy dictates. At this day and age it just seems mistaken to assess marital fidelity in terms of money.”

 

 

 Read the full judgment here:- http://www.saflii.org/za/cases/ZACC/2015/18.pdf

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Book review: LAW OF DIVORCE AND DISSOLUTION OF LIFE PARTNERSHIPS IN SOUTH AFRICA By Jacqueline Heaton (Editor)

(796 pages)

Juta & Co Ltd
www.jutalaw.co.za

“Marriage,n. The state or condition of a community consisting of a master, a mistress and two slaves, making in all, two.”

– – Devil’s Dictionary (1911) by Ambrose Bierce

This comprehensive new publication provides within its covers an in-depth and detailed analysis of the law in South Africa relating to the termination by divorce of civil unions, civil marriages, customary marriages, Muslim marriages and Hindu marriages as well as the dissolution of life partnerships.

Various sections of the book deal with the grounds for divorce, the personal and financial consequences of divorce, and the situation of minor and dependent children. Issues covered include domestic violence, procedure, costs, conflict of laws, and alternative dispute resolutions options such as mediation.

Publishers Juta and editor Professor Jacqueline Heaton, BLC, LLB, LLM, have assembled as contributors a distinguished panel of practitioners and academics from the Universities of Witwatersrand, Free State, North-West, Western Cape, Cape Town, Pretoria, Johannesburg and the University of South Africa. Their combined expertise make this work an exceptional resource for all professionals who deal on a daily basis with the important decisions to be made and steps to be taken on all these intimate personal relationships which form the core of our social, cultural and economic fabric.
A significant and valuable feature of this work is the well-indexed references to local and foreign legislation, applicable case law, an extensive bibliography and pertinent footnotes providing the essential authorities for a truly outstanding exposition of the law in a field which has recently been somewhat neglected and fragmented. That gap has been more than handsomely filled and the publishers and team of authors are to be congratulated.

Review by Louis Rood, BA LLB (UCT), of Fairbridges Wertheim Becker.

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Debt re-arrangement agreements: may creditors obtain judgment without notice?

In Jili v Firstrand Bank Ltd, the Supreme Court of Appeal (SCA) held that if a debtor has breached a debt re-arrangement agreement, a creditor has the right to enforce its rights without further notice to the debtor and may issue summons immediately after the breach.

In this case, the appellant had failed to pay instalments due and had entered into a debt re-arrangement agreement with her creditors. The consumer didn’t make her reduced payments for two months and the Kwa-Zulu Natal High Court granted a summary judgment against her –without her having received notice of the proceedings -, on the basis that she had no defence to the Bank’s claim, and that she had defended the litigation just to delay it.

The consumer claimed that the creditor had no right to proceed without notifying her and those similar to her who were a party to a debt restructuring agreement. On appeal, the SCA disagreed, and confirmed that when a consumer has breached a debt restructuring agreement, a creditor, such as the Bank, may obtain judgment against that person, without giving any notice of its intention to do so.

Read the judgment here: http://www.saflii.org/za/cases/ZASCA/2014/183.html

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Equal Pay For Equal Work – New Code of Good Practice

The Minister of Labour has issued a code of good practice which regulates remuneration for work of equal value.

The code’s application extends to all employers and employees covered by the Employment Equity Act and compels employers to take steps to eliminate differences in terms and conditions of employment, including the payment terms of those employees who perform the same or substantially the same work or work of equal value.

The code sets out three key issues which require scrutiny when examining whether the obligation to apply remuneration equity is applicable:
1. Are the jobs that are being objectively compared the same or substantially so?
2. Is there a difference in the terms and conditions of employment, including payment?
3. Are the differences justifiable?

Read the code here:
http://www.polity.org.za/article/employment-equity-act-code-of-good-practice-on-equal-payremuneration-for-work-of-equal-value-gazette-38837-notice-r448-2015-06-09

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Terms of Service - too long, didn´t read?

“I have read and agree to the Terms” is the biggest lie on the web. We aim to fix that.”

Terms of service agreements typically require a user to agree to or abide by a certain set of rules before making use of the service provided. Millions of such agreements are conconcluded on a daily basis, yet very seldom are the terms even considered by the user before they have agreed to them. In the United States, the courts have held such agreements to be both binding and enforceable. These agreements have not yet been tested in our courts, but in principle it seems they may stand up as valid contracts.

Terms of service: Didn’t Read is a browser add-on which essentially provides crowd sourced summaries, ratings and labels for the common terms and service agreements that web users encounter on a daily basis.

Google’s Privacy and terms [http://www.google.fr/intl/en/policies/privacy/key-terms/] has been given a “Classic C” rating and summarised as follows:

– Google keeps your searches and other identifiable user information for an undefined period of time;

– Google can use your content for all their existing and future services;

– This service tracks you on other websites;

– Google can share your personal information with other parties; and

– Google may stop providing services to you at any time.

SoundCloud on the other hand has been awarded a Class B for the following reasons:

+ You stay in control of your copyright;

+ Collected personal data used for limited purposes;

+ 6 weeks to review changes;

– Indemnification from claims related to your content or your account; and

– Personal information can be disclosed in case of business transfer or insolvency.

To download the extension yourself click here [http://tosdr.org/downloads.html]

To learn more about the service click here [http://tosdr.org/index.html]

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A copyright case – involving dictionaries

Media24 has filed their application for leave to appeal following judgment by Gamble J in Media24 Books (Pty) Ltd v Oxford University Press Southern Africa (Pty) Ltd.

Media24 applied for a final interdict against Oxford University Press, requesting an order prohibiting further infringement of its rights under the Copyright Act 98 of 1976. Media24 alleged that Oxford University Press had plagiarised a number of their example sentences from their Afrikaans/English school dictionary. Judge Gamble found in favour of Oxford University Press and dismissed the application brought by Media24, due to their failure to show “sufficient objective similarity”, and its actual harm suffered. Gamble focussed on the “quality” of the work alleged to be plagiarised “and not quantity” .

Gamble noted in his judgment –

“I am accordingly not persuaded that Media 24 has discharged the onus of establishing the requisite right, or the breach thereof, sufficient to entitle it to final relief at this stage”

“ the OUP [Oxford University Press]work has been in the public domain for more than 4 years now and to terminate the right to publish now when its denials are likely be fully ventilated at trial, will be highly detrimental to OUP. I would therefore be inclined to exercise that discretion in favour of OUP.”

http://www.saflii.org/za/cases/ZAWCHC/2015/68.html

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Shark-cage diving vessels and negligence

In 2008, a shark-cage diving vessel, MV Shark Team, was struck by a wave whilst anchored at the Geldsteen reef near Gansbaai. The vessel capsized and three people on board drowned. The wife of one of the deceased brought a claim for damages against the vessel (in rem), the skipper and the owner. She claimed that the defendants were negligent because the skipper should have realised that the vessel was anchored in an area prone to large swell and the vessel should have left the area before the capsizing swell arrived. The defendants’ claimed, however, that the wave was a ‘freak’ wave of at least 11m high that could not reasonably have been foreseen.

In December 2014, the Western Cape High Court held that the test is not whether a wave of the size of the freak wave that struck the vessel could have been foreseen but whether the skipper could have reasonably foreseen a wave breaking over the vessel. The court held that the rough swell in the area meant that a wave breaking over the vessel was reasonably foreseeable and therefore the death of a passenger was reasonably foreseeable. The skipper had therefore acted negligently and the Court found the defendants liable for damages as the claimant might prove in consequence of the death of her husband.

Access the judgment here.

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Davis Tax Committee report released for public comment

On 5 June 2015, the Davis Tax committee released its first interim report for public comment. The committee was formed 2013 in order to “assess South Africa’s tax policy framework and its role in supporting the objectives of inclusive growth, employment, development and fiscal sustainability.”

The report is a macro analysis of the tax policy framework currently in operation within South Africa. It aims to articulate a set of overarching principles to guide an assessment of the current South African tax system so as to identify the needs for reforms and to make relevant recommendations in this respect.

The report is available here and an abridged version here.

The report seems to suggest that an increase in Value Added Tax would be more probable than increases in other forms of taxation. Sceptics of the policy have cautioned that any such increase will likely stem economic growth.

The closing date for comment is 31 August 2015.

See full article at http://www.bdlive.co.za/economy/2015/06/08/davis-committee-prefers-less-severe-vat-hikes

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Book review: PERSPECTIVES ON THE LAW OF PARTNERSHIP IN SOUTH AFRICA

PERSPECTIVES ON THE LAW OF PARTNERSHIP IN SOUTH AFRICA
By J J Henning
(335 pages)

Juta & Co Ltd
 www.jutalaw.co.za

“Men are made for society and mutual fellowship.”
– Edmund Calamy (1671 – 1732)

Partnerships are one of the oldest concepts of our law but remain very much a part of modern commercial law, as well as in other areas such as family law.

This welcome work provides an in depth examination of the various principles, doctrines and characteristics of partnerships and deals in detail with complex areas of partnership law. The legal status of partnerships, limited partnerships, universal and general partnerships and anonymous or silent partnerships are all discussed from a comparative perspective.

The distinguished author Professor J J Henning, B Iur, LLB, LLD, Dean of the Faculty of Law of the University of Free State, is the unrivalled specialist expert in South Africa on this branch of the law. He writes:
“The partnership concept is one of great antiquity. Some of its oldest forms have their origins in ancient family arrangements. As a profit-seeking and profit-sharing device it is as old as joint economic endeavour for mutual benefit.”

Rich in cited authorities, with a comprehensive bibliography, schedules of relevant case law and South African and foreign legislation, well-indexed and organised, this authoritative resource will be welcomed by legal practitioners, judicial officers, and commercial and corporate law specialists. It will undoubtedly invigorate interest and stimulate a new awareness of partnership in all its manifestations. Congratulations are due to publishers Juta and the learned author for this meritorious and meticulously researched publication.

“Having regard to Prof Henning’s general status as an academic researcher and his stature as the undisputed leader in the particular field of partnership, the present publication is to be acclaimed with enthuasiasm.” – Appeal Court Judge Fritz Brand.

Review by Louis Rood BA, LLB (UCT) of Fairbridges Wertheim Becker.

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Unlawful Credit Agreements - Section 89(5)(b) of the NCA declared Constitutionally invalid

In a unanimous judgment the Constitutional Court has upheld the judgment of the Western Cape High Court declaring section 89(5)(b) of the National Credit Act constitutionally invalid.

Previously Section 89(5)(b) provided that

“[i]f a credit agreement is unlawful in terms of this section, despite any provision of common law, any other legislation or any provision of an agreement to the contrary, a court must order that—(b) the credit provider must refund to the consumer any money paid by the consumer under that agreement to the credit provider, with interest calculated—

(i) at the rate set out in that agreement; and

(ii) for the period from the date on which the consumer paid the money to the credit provider, until the date the money is refunded to the consumer”.

The matter came before the High Court prior to the operation of the National Credit Amendment Act, which provides that a court should make a just and equitable order when faced with unlawful credit agreements.

As the Amendment Act had not yet come into operation at the time the matter was in the High Court the Constitutional Court has in the interim clarified the position by echoing the words of the Amendment Act as follows:- To remedy the defect, from 5 June 2014 to 13 March 2015, section 89(5) of the National Credit Act is deemed to read as follows:

“(5) If a credit agreement is unlawful in terms of this section, despite any other legislation or any provision of an agreement to the contrary, a court must make a just and equitable order including but not limited to an order that:
(a) The credit agreement is void as from the date the agreement was entered into.”

Read the judgment here:- http://www.saflii.org/za/cases/ZACC/2015/15.html

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SCA decision: Non-South African Companies can be asked to furnish security for costs

According to a recent judgment of the SCA, a foreign company may be asked to provide security that it is able to settle the legal costs of its opponent in the event that it is unsuccessful in litigation. The purpose of this rule is to discourage foreign companies from instituting frivolous litigation in South Africa. The litigation in this case was brought by a shell company funded by its four shareholders. The company pleaded that it did not have the finances to provide security.

By way of explanation, once legal proceedings are finalised, a costs order will usually be made against the unsuccessful party. If such an order is made against a Plaintiff (the party instituting the proceedings) located outside of South Africa, and the Plaintiff refuses to pay the successful party’s costs, recovery can be challenging where – as is often the case – there are no company owned assets within the Republic to attach and sell in execution.

It is no secret that the legal costs required to run a trial can, and often do, outweigh the capital claimed. Once one is sued, there is very little option but to defend at great cost. This judgment may have the effect of reducing the number of frivolous actions brought or, at least, ensuring the recovery of costs once the litigation is concluded.

Access the full judgment here: http://www.justice.gov.za/sca/judgments/sca_2015/sca2015-093.pdf

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New requirements for travelling with children

Director-General Mkuseli Apleni called for a briefing to clarify a few issues ahead of the 1st of June 2015 implementation.

There has been much hype leading up to the implementation of these requirements. In summary, children leaving South Africa are required to produce parental consent affidavits and unabridged birth certificates, where one parent or another person is travelling with somebody else’s child. Due to the backlog of +/- 4000 applications for unabridged birth certificates, Director-General Apleni has relaxed these requirements, by allowing those who have applied for unabridged birth certificates, who are planning to travel, and who are still waiting for their unabridged birth certificates, to travel, subject to a visit to their nearest Home Affairs office to obtain a ‘letter of consent’.

The Director-General noted that –
“We do not understand the claims that our requirements are unique, not applicable elsewhere, and would have consequences for tourism and the economy in general. Our regulations were benchmarked even with countries attracting more tourists. SA citizens are also required to have these documents when going to some countries of the world. It was also due to requirements expected of our citizens by other countries that we decided to move towards issuing the unabridged birth certificate with the child’s and parent(s) particulars in it.”

http://www.home-affairs.gov.za/index.php/statements-speeches/632-statement-by-home-affairs-director-general-mkuseli-apleni-at-the-media-briefing-on-new-requirements-for-travelling-with-children-coming-into-effect-on-1-june-2015

The hype surrounding these requirements continue and “the concerns may not be unfounded. Reports emerged last week that Air China had cancelled the launch of direct flights to South Africa over the regulations” (http://www.southafrica.info/travel/visa-rules-010615.htm#.VW_5S1KJgaI)

Minister Jeff Radebe commented on the regulations, stating that –
“We are looking at all issues that have been raised pertaining the visa regulations. Despite the noble intentions of these immigration policies, they have had an unintended consequence which needs to be addressed”

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Carbon tax for 2016?

During the annual budget speech, the Minister of Finance announced that draft carbon tax legislation will be published in 2015 for public consultation in the hope that it will become law in 2016. The carbon tax will apply to all direct greenhouse gas emissions that are released from sources owned or controlled by the specific entity.

The tax will be imposed at a rate of R120 per tonne of carbon dioxide equivalent and increase by 10% per annum. For liquid or transport fuels and other non-stationary greenhouse emissions, the carbon tax will be incorporated into the current fuel tax regime. Entities that are liable to pay carbon tax may reduce their liabilities by buying carbon credits from entities that are not liable for carbon tax, provided that certain requirements are met.

Companies from all sectors will need to come to terms with the broader implications of the carbon tax because even if an entity itself is not liable for carbon tax, it will be indirectly affected by other entities in the supply chain that are liable to pay the carbon tax.

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FWB Attorney hits the red carpet!

Our very own Andrew Hewitt attended the Cannes Film festival last month. Andrew is our resident entertainment law specialist. His clients include inter alia artists, filmmakers, musicians, production studios and business start-ups.

You can read a bit more about Andrew and his practice here. 

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Draft gambling policy gazetted for public comment

The National Gambling Board has released a draft policy for public comment.

Some of the contentious issues covered include the illegality of an act of online gambling as well as the winnings associated with it. The policy suggests the implementation of certain penalties for perpetual transgressors as well as the empowerment of the inspectorate to investigate and prosecute matters.

The possible expansion of animal racing has been restricted taking into consideration animal welfare and proliferation, and the policy envisages statutory regulations for horse racing to minimise animal welfare concerns.

An invitation has been extended for public comment until 5 July 2015.

Read more here:-
http://www.ngb.org.za/organisational-areas/news/invitation-for-the-public-to-comment-on-the-national-gambling-policy.aspx

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Time to save?

Tax-free saving accounts were introduced on 1 March 2015 in order to encourage more people to start saving. The annual contribution limit is R30 000 and the lifetime limit is R500 000 per person. This means that if R30 000 is invested per annum, after approximately 17 years a person can accrue a tax-free investment of R500 000. If a person makes a contribution of over R30 000 per annum, however, SARS will penalise them when submitting their tax returns. It appears to be a good way to save or invest as the amounts that are received or accrued from the investment will not be subject to income tax, dividend withholding tax or capital gains tax.

See a related article on Moneyweb:http://www.moneyweb.co.za/mymoney/moneyweb-personal-finance/coronation-allan-gray-launch-tax-free-savings-accounts/

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The concept of a binding offer by creditors in business rescue now clarified.

A landmark decision has been made by the Supreme Court of Appeal whereby the concept of a binding offer in the business rescue context has now been clarified.

Previously in circumstances where a business rescue plan cannot be adopted due to opposition, creditors in support of the plan would make binding offers to those creditors opposed to it. Offers are made to buy the opposing creditors’ claim, in order to obtain more voting rights in support of the plan. In other words, if Creditor 1 made a binding offer to Creditor 2, Creditor 2 would in essence lose their voting rights. Creditor 2 was not given opportunity to either accept or decline the offer.

The SCA has now clarified the position in that the nature of a binding offer should be construed in a similar light to that of the common law position, whereby both offer and acceptance need to take place. “The settled meaning both in general use and in the more technical legal use of the word ‘offer’ is that it is only on acceptance that an offer creates rights and obligations”.

Access the judgment here:- http://www.saflii.org/za/cases/ZASCA/2015/69.html

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The NCA and prescription

The NCA requires, as a precursor to litigation on a credit agreement, that one sends a ‘s129’ notice, advising the debtor of his rights in terms of the NCA, and a few other formalities. Where a credit provider institutes an action to enforce payment of a debt arising from a credit agreement, the running of prescription in respect of the debt –which in SA is 3 years – is interrupted by service of the summons. This is also the case where one has neglected to serve the notice prior to issuing summons.

Therefore if a credit provider issues summons and fails to attach a s129(1) notice, the summons is not considered void and prescription is still interrupted.

Link to full judgment here

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Retirement of Fairbridges Chair

Messages of goodwill flowed in for long-serving Chair of Fairbridges, Louis Rood, who has retired after 42 years at the firm, 34 on the board, and 10 years as Chair. He was only the 15th Chair of the firm, in 203 years since it was established in Cape Town in 1812. He has been an exceptional and influential leader of both the firm and the legal profession.

A BA LLB graduate of the University of Cape Town, Louis served his articles at Fairbridges in 1973 and 1974 and became a partner of the firm in 1981, and Chair in 2005. He has had an outstanding career, as a litigator, with more than 15 of his cases having been reported in the SA Law Reports. Over 40 of his articles have been published in various law journals, and he has appeared in panel discussions on national radio and television. More than 30 of his book reviews of legal works have been published. He was general editor of Fairbridges Law Letter for 27 years.

Louis is Chairman of the Library Committee of the Cape Law Society. In 2012 he received an Award in Recognition of a Lifetime Contribution to the Profession from the Cape Law Society.

He has served as a board member for 13 years of the international network of independent law firms, TerraLex, and as its Regional Vice-Chair for Africa & Middle-East. He served as Senior Vice-Chair, Chair of the Nominating Committee and Compensation Committee, on the Executive Committee and has also chaired special committees on corporate governance. He is one of only two recipients of the TerraLex Lifetime Achievement Award, and in 2013 was namedTerraLex Lawyer of the Year. Louis is a member and trustee of various cultural, education and literary organisations and funds.

Fairbridges Wertheim Becker is grateful for the enormous contribution Louis has made over so many years. Fortunately he remains with the firm in his new capacity as a Consultant.

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New Chairperson Appointed

Deirdré Olivier has been appointed Chairperson of Fairbridges Wertheim Becker. A BA LLB graduate of the University of Cape Town. She served her articles at Fairbridges, was admitted as an attorney in 1995, and later qualified as a notary public. She has been a director of the firm since 1997 and heads up litigation at the Cape Town office. She is a long-serving member of the firm’s management team. Her appointment as the 16th Chair of the firm has been widely acclaimed and welcomed. Her exceptional professional reputation and leadership credentials make this a well-deserved appointment.

Deidré is a member of the Institute of Forensic Practitioners and a qualified mediator with FAMSA. She specializes in commercial and civil litigation, corporate litigation, property, housing and planning law, constitutional law, forensic investigations, administrative law, contract and delict, dispute resolution, environmental law, immigration law and debt recoveries. She has extensive experience in drafting opinions, policies and legislation and advising on local authority law.

She represents various municipalities and other organs of state, universities, the South African National Biodiversity Institute, The Publishers Association of South Africa and other corporate and private clients. Deirdre has conducted a number of high profile cases over the years in the Constitutional Court, the Supreme Court of Appeal, High Courts, Magistrates Courts and the Land Claims court. She has also represented clients in important mediation proceedings and public commissions of enquiry. Her experience includes successful litigation against illegal drug and liquor dealers in state housing, to demolish unsafe buildings, and the enforcement of property and planning legislation.

Fairbridges Wertheim Becker is privileged to again have at its head a leader of truly outstanding calibre.

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Leading South African Law Firms Merge

Two of South Africa’s longest established law firms have joined forces in a significant mid-market merger. Fairbridges is the oldest law firm in Africa and the Southern Hemisphere, having been established in Cape Town in 1812. Wertheim Becker was founded over a century ago in 1904 in Johannesburg. From 01 March 2015 these well-respected firms will combine to practise as Fairbridges Wertheim Becker.

“This is a carefully considered strategic and logical convergence of two well-matched firms which will significantly enhance our combined resources and capacity,”says Fairbridges managing partner, Dick Cheeseman. His sentiments are echoed by Wertheim Becker’s senior partner,  Bernard Joffe; “The two firms are a complimentary fit with exciting synergies, which we are confident will be of considerable benefit to all our clients.” The merger creates a full-service corporate and commercial law firm, with significant specialist expertise and professional experience across the board. “Through our active and exclusive South African membership of leading international law firm network, TerraLex, we are able to offer our clients world class, cross-border legal services throughout Africa and around the globe,” says Amish Kika of Wertheim Becker. “The reputations of both firms are solidly based on an unwavering commitment to providing the highest quality representation and our network membership enables us to benchmark ourselves against world class best practices.” David Short of Fairbridges emphasises that both firms are proud of their deep roots, rich heritage and solid professional values which have sustained and invigorated the firms for so long. “While we rely on our experience and maturity, we constantly seek to refresh, renew and adapt our services -and the way we deliver them – to add value. There is a massive demand in South Africa for affordable, practical and constructive legal support. We believe that we are well positioned to meet that need while upholding the highest standards of the legal profession.” This development in the domestic South African legal market by these influential firms will be welcomed by many who have demonstrated their desire for mid-tier, accessible, relationship-building and enterprising local law firms.

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The Alienation of Land Act

In the recent Constitutional Court case of Botha v Rich NO the court decided that a purchaser may force a transfer of land in terms of Section 27 of the Alienation of Land Act, provided that more than half the purchase price has been paid and that the purchaser is not in arrears.

The court further held that the principle of good faith underlying the law of contract dictates that land should be transferred to a purchaser in this situation against the furnishing of appropriate guarantees, even if the purchaser is in arrears with installments.
http://www.legalbrief.co.za/filemgmt_data/files/Botha%20&%20Another%20v%20Rich%20N.O%20&%20Others.pdf

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Bangladesh extends territory

The Permanent Court of Arbitration in The Hague has awarded Bangladesh more than 9 700 square miles in the Bay of Bengal, ending a three decade-long maritime dispute between Bangladesh and India.

Bangladesh initiated the arbitral proceedings against India.
The dispute originated from the partition of British India into the two states of India and Pakistan in 1947 http://www.pca-cpa.org/showpage.asp?pag_id=1376[/fa-maintext]

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Insight into POPI (Protection of Personal Information Act)

Did you know that in terms of Section 5(f) of the POPI, you have the right not to be solicited by direct marketing by means of unsolicited electronic communications (text, voice, sound or image message) without your consent. Such direct marketing must contain the details of the sender, together with the contact details necessary to direct a request that the communications cease.

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Advertising Standards Authority Ruling

In a recent Advertising Standards Authority (ASA) matter involving a billboard on the Soweto Highway, Mini Cooper undertook not to use the phrase “DRIVE IT LIKE IT’S STOLEN” again to promote its products. According to the complainants the advertisement, which featured a billboard with the shape of a Mini Cooper cut out of it, was irresponsible and offensive in that it promoted and glorified the stealing of cars, speeding and reckless driving. The billboard had been stolen by the time the ASA heard the matter http://www.asasa.org.za/ResultDetail.aspx?Ruling=6898

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Women´s day

“The fastest way to change society is to mobilize the women of the world.” – Charles Malik

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Mergers and acquisitions picking up

According to UK research firm Mergermarket, mergers and acquisitions are starting to pick up after six years of stagnation. It is likely that companies in South Africa and other African countries will follow this trend, particularly those countries unconstrained by competition regulations. These sorts of deals are expected to find the most growth in the mining sector and in renewable energy projects http://www.financialmail.co.za/moneyinvesting/2014/07/10/mergers-acquisitions-africa-s-resurgence

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Mediation FAQ 5

How is the mediator appointed? It is essential that the mediator is seen as independent and impartial. The mediator is appointed either by the parties themselves, after agreeing on a mediator from a list of nominations, by the Chair of an independent institution, after having been requested to do so. Where particular expertise is required, such as an accounting background where the valuation of shares is at issue, a mediator with industry-specific experience is appointed.

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New Practice Rule - Cape Town Regional Court

Last month the Cape Town Regional Court introduced a practice rule that all applications for default judgment take place in open court and that a representative of the applicant be present. Previously a default judgment was decided by a Magistrate on the papers, which would be sent back to the applicant with queries. The new procedure will simplify and expedite this process by allowing a Magistrate to raise and deal with any queries immediately.

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Prescribed Rate of Interest Increases

As of 1 August of this year, the prescribed (default) rate of interest on all claims has been reduced from 15% to 9%. This means that a litigant will not be able to claim more than 9% on any monetary claim brought to court, unless a different rate of interest has been agreed between the parties beforehand.

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Miss Soweto

The Miss Soweto beauty pageant takes place today at the New Soweto Theatre in Jabulani. The pageant, which was first established in 1979, has produced two Miss South Africa’s and one Miss Universe, and is often as a professional springboard for its winners. Each year a percentage of the pageant’s proceeds contribute towards funding a worthy cause or charity in the entertainment industry.

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Law Firm Leadership - Louis Rood

Congratulations to our Chairman, Louis Rood, whose article “Law Firm Leadership” appeared in the July 2014 issue of De Rebus http://www.myvirtualpaper.com/doc/derebus/de_rebus_digital_july_2014/2014061802/24.html#24

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Who´s who in the Fairbridges Zoo?

Wickaum Smith, a Director at Fairbridges, specialising in Medical Law, Administrative Law, Insurance Law and general litigation. http://www.fairbridges.co.za/attorneys/27/

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Whistle-blowers can face prison time

Whistle-blowers who deliberately disclose false information could face up to two years in prison, and fines. These penalties are contained in new amendments to the Protected Disclosures Act, recently published for public comment. Should the amendments be signed into law, it will be a criminal offence to knowingly disclose false information.

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Albie Sachs´ view of the Constitutional Court

In a recent interview, former Constitutional Court judge Albie Sachs, in explaining his role in setting up the Constitutitional Court, expressed his love for the court and his former colleagues. ‘We were from such different backgrounds, philosophically, culturally and professionally, and were all motivated to try and make operational sense of this beautiful document we’d produced. I don’t think there’s another court in the world which had debates like we had to get better quality for our Constitutional Court.’

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Prescription period waived in negligence case

Judge Tshiqi in the Supreme Court of Appeal in Macleod v Kweyiya, recently decided that the claimant was entitled to sue her attorney 25 years after her case against the Road Accident Fund was settled negligently.

The claimant was rendered a paraplegic after a motor vehicle accident and the attorney was appointed by her mother to claim damages. Irrespective of the three year prescription period in terms of the Prescription Act the court decided that she could sue her former attorney for damages, as she was entitled to rely on her mother and her attorney to act in her best interests in settling the matter.
She claimed she was due R2.1m at the time of the settlement and quantified the monetary value of this amount at the time she sued her former attorney to be R4.8m. They settled at a mere R99500. The court decided that prescription would only start to run from the date that she became aware of the terms of the settlement agreement. http://www.saflii.org/za/cases/ZASCA/2013/28.html

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New Anti-Avoidance Measures

New anti-avoidance measure for employee-share incentive schemes. The treasury has recognised that employee-share incentive schemes have created “disguised” salaries for employees that are tax free. How? Equity shares are held on behalf of employees, with the sole intention of generating dividends for employees, without the employees taking ownership of the shares, thereby creating tax-free dividends.

A new proviso, inserted into Section 10(1)(k) of the Income Tax Act 58 of 1962 has rendered dividends received by or accrued to an employee by virtue of their employment, taxable.
https://sait.site-ym.com/news/175144/Employee-share-incentive-schemes-new-anti-avoidance-measures.htm

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Cape Town Fashion Week

Cape Town Fashion Week begins today and runs until Saturday at the CTICC. The event showcases the work of some of South Africa’s most innovative designers, including Gavin Rajah and David Tlale, as well as a conference where speakers give budding designers business advice, and a show featuring the work of fashion students studying at institutions affiliated to African Fashion International.

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Insight into POPI (Protection of Personal Information Act)

What happens if a business does not follow POPI? Apart from being subject to fines and other penalties, the reputation of a business may be compromised as customers will not do business with a company which does not handle their personal information with care.

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Mandarin introduced as a new elective in schools

According to a recent media statement by the Department of Basic Education, Mandarin will be introduced as a new elective subject in schools, in terms of a a co-operation agreement signed last year by South Africa and China on formalising the teaching of Mandarin in South African schools. The Minister has appointed a task team to determine whether Mandarin should be taught as a first or second additional language – or both. http://www.legalbrief.co.za/article.php?story=20140613052640445

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Judge Goldstone

“I am concerned when I read about inadequate facilities in the Magistrates Court; it is really in the lower courts where justice affects the people.” – former Constitutional Court judge, Justice Richard Goldstone

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Mandela Day

Mandela Day was officially adopted by the United Nations as an international day in 2009. The initiative, held each year on Mandela’s birthday, asks each of us to give 67 minutes of our time to a positive initiative in our communities. The initiative is no longer limited to South Africa and people all over the world are encouraged to take part.

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Mediation FAQ

Mediation FAQ 4: Is mediation voluntary? Yes. No legislation has yet been published in the Government Gazette making pre-litigation mediation compulsory. Court-assisted consensual mediation has now been provided for in recent amendments to the Magistrates Court Rules. As such, mediation, both pre-litigation and during litigation, is commenced only by agreement.

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Customary Marriages

In the recent judgment of Moropane v Southon, the Supreme Court of Appeal affirmed developing jurisprudence on customary marriage, which seeks to place African customary marriage ‘on the same pedestal as civil marriages’. During divorce proceedings a Pedi man argued that he had not entered into a customary marriage with his long-time partner as it was not ‘negotiated and entered into or celebrated in accordance with customary law’ as required by the Recognition of Customary Marriages Act. The court decided that, in this instance, this requirement had been fulfilled. http://www.justice.gov.za/sca/judgments/sca_2014/sca2014-076.pdf

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Dagga laws

Pro-medical dagga activist, Sheldon Cramer, has instituted a High Court action against the state, calling for the laws on dagga to be reviewed, ‘given the evidence that dagga is actually a well-documented potent medicine capable of curing cancer.’ According to Cramer, the legalisation of dagga poses a huge financial threat to the pharmaceutical industry – as confirmed recently by the Health Department – replacing 60% of their product lines.

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POPI

Insight into POPI (Protection of Personal Information Act): What is the purpose of the POPI? It gives effect to the right to privacy, enshrined in Section 14 of the Constitution, while still attempting to strike a balance with other constitutional values, such as the right of access to information.

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KayaFM Mandela Day relay

The second annual KayaFM 67km relay will be held on Sunday at the Waterfall Country Estate in Sunninghill, Gauteng, in celebration of the upcoming Mandela day on 18 July. Last year, 1102 corporate relay teams and over a thousand fun-run entrants participated. The proceeds of the run will again go to the Nelson Mandela Foundation http://eventful.com/johannesburg/events/kaya-fm-67km-relay-mandela-day-/E0-001-071118081-4

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Feedback

We are always appreciative of our client’s comments and feedback. Louis Rood, Chair of Fairbridges Attorneys recently received praise for our quarterly Law Letter – “an excellent publication, quick and easy read and generally informative.” If you would like to subscribe to our Law Letter, contact attorneys@fairbridges.co.za.

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Mediation FAQ 4

Is mediation voluntary? Yes. As at January 2014 no legislation has yet been published in the Government Gazette making pre-litigation mediation compulsory. Court-assisted consensual mediation has now been provided for in recent amendments to the Magistrates Court Rules. As such, mediation, both pre-litigation and during litigation, is commenced only by agreement.

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Restaurant review battle resolved

A decade-long court battle over a restaurant review, comprising 8 court cases in total, has finally been decided in favour of the restaurant by Australia’s Supreme Court. The Sydney Morning Herald, which printed a review describing a pork belly dish as ‘the porcine equal of a parched Weetbix’, was ordered to pay restaurant Coco Roco the equivalent of R6.2m after the court ruled that the review failed to adequately point out that Coco Roco was in fact two restaurants and that the critic had eaten at the up-market Coco and was not reviewing the bistro-style Roco.

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Spam

Did you know that it is possible to opt out of spam? Simply visit the DMA (Direct Marketing Association of Southern Africa) website and remove your personal details from the database so they can no longer be used by DMA members to spam you with unsolicited offers and unwanted direct marketing. You can also do this by contacting certain companies directly and asking them not to contact you.

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Electric vehicle patents opened

Tesla Motors recently announced that it would be opening up all patents it holds for the electric vehicle market, including those for its Supercharger stations which charge its electric vehicles. This will allow other competitors to enter the electric vehicle market and potentially expand it exponentially. Initially Tesla obtained the patents to protect itself against large vehicle manufacturers but quickly realised that electric vehicle programs at these manufacturers were virtually non-existent. The company has vowed not to sue anyone that uses its technology in good faith http://www.iflscience.com/technology/tesla-release-electric-car-patents-public

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Knysna Oyster Festival

The Pick ‘n Pay Knysna Oyster Festival starts today and runs through to 13 July 2014. This festival invites seafood lovers to tuck into ocean-fresh fare and is enjoyed in the beautiful Garden Route town of Knysna.

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Book review - Applied Law for Police Officials by C Joubert (Fourth Edition)

Book Review – Applied Law for Police Officials by C Joubert (Fourth Edition). Review by Louis Rood, BA LLB, Chairman of Fairbridges Attorneys http://www.fairbridges.co.za/news-and-publications/articles–interesting-legal-developments/

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Certain tax debts, the duty of shareholders?

Can shareholders be held liable for company tax debts? In terms of Section 181 of the Tax Administration Act 28 of 2011, shareholders can be held jointly or severally liable for certain tax debts of their company. This is the case where a company is in voluntary liquidation and has an outstanding tax debt, and shareholders have received assets of the company in their capacity as shareholders, within one year prior to winding up. https://sait.site-ym.com/news/174175/The-liability-of-shareholders-for-the-tax-debts-of-a-company.htm

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Egypt´s wealth tax

Egypt is to impose a 5% surtax on incomes greater than R1.46 million a year and will last three years. This meausre still needs to be passed by the interim President before it can be implemented. https://sait.site-ym.com/news/172682/Egypt-Wealth-tax-to-last-three-years.htm

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John Bromley

Who’s who in the Fairbridges Zoo – John Bromley, a Director at Fairbridges, specialising in Medical Law and Litigation. http://www.fairbridges.co.za/attorneys/3/

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APPEAL AGAINST CONTROVERSIAL LAND INVASION JUDGMENT UPHELD BY THE SUPREME COURT OF APPEAL

APPEAL AGAINST CONTROVERSIAL LAND INVASION JUDGMENT UPHELD BY THE SUPREME COURT OF APPEAL

The shortage of housing in the Western Cape has again been cast in the spotlight as the Courts are called upon to balance the rights of private land owners, those of the homeless and indigent and the obligation of local government to provide housing and emergency shelter. The Supreme Court of Appeal has upheld an appeal brought by the City of Cape Town and Ms IA Fischer against a judgment handed down by the Western Cape High Court in terms of which the City was interdicted from dismantling informal structures which had unlawfully been erected on privately owned land.

The City was directed to construct temporary habitable dwellings, affording shelter, privacy and amenities for those occupants who had unlawfully erected informal structures on that land.
The dispute arose around orchestrated land invasions which resulted in numerous structures being erected by individuals on privately owned land in early 2014. The City dismantled all structures which were vacant, unoccupied or partially built. The City at all stages contended that the structures were not occupied, and were accordingly not ‘homes’ as contemplated by Section 26(3) of the Constitution. The approach adopted by the City was that if the illegal structures were not homes as envisaged in terms of the Prevention of Illegal Evictions and Occupations Act (“PIE”), it was not necessary to obtain a court order to dismantle them. The occupants argued that the structures were their homes and that a court order was therefore necessary to evict them.

The City readily accepted and acknowledged that it was not authorised to dismantle structures that had become homes without a court order authorising it to do so and that any structures that were proved to be homes and been dismantled, would be re-built. It also contended that structures that were already built and occupied on the day were left undisturbed. Due to the disparity in evidence the parties agreed that the matter would have to be referred to oral evidence at a later stage, to ascertain whether the structures dismantled were indeed vacant and unoccupied.
The High Court, however, disagreed that the matter required oral evidence. It’s view was that there were legal points that would resolve of the matter. The Court also disagreed with the City’s argument that the test was ultimately ‘whether or not the structures were homes’, and ruled instead that the question was whether the structures were occupied at the time that they were dismantled, thereby arguably extending the PIE Act beyond Section 26(3) of the Constitution – which provides only that no one can be evicted from their ‘home’. The High Court held that the completed structures qualified for the protection of PIE, and as such, the provisions of PIE not having been followed, that the removal of the structures was unlawful.

The Supreme Court of Appeal disagreed. It upheld the appeal against the declaration of unlawfulness of the dismantling of the structures, as well as the order that the City reconstruct them. It ordered that oral evidence was necessary before the Court could competently come to a final decision, and remitted the matter back to the High Court for the hearing of that evidence. The reasons for the decision will be published in the written judgment, which should be available soon. The interdict, initially brought by Ms Fischer and the City, prohibiting the erection of any further structures on Ms Fischer’s land, has been extended to 1 September 2014.
The City and Ms Fischer are represented by Fairbridges attorneys. The Legal Resources Centre acts for the Occupiers.

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Mediation FAQ 5

How is the mediator appointed? It is essential that the mediator is seen as independent and impartial. The mediator is appointed either by the parties themselves, after agreeing on a mediator from a list of nominations, by the Chairman of an independent institution, after having been requested to do so. Where particular expertise is required, such as an accounting background where the valuation of shares is at issue, a mediator with industry-specific experience is appointed.

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Education

“By education I mean that training in excellence from youth upward which makes a man passionately desire to be a perfect citizen, and teachers him to rule, and to obey, with justice. This is the only eduction which deserves the name” – Plato

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Terralex Insight

Terralex Insight – Nixon Peabody is the Terralex member firm for New York, Massachusettes and Rhode Island.  Its former chairman Harry Trueheart is the current Chair of Terralex.

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Terralex Insight

Nixon Peabody is the Terralex member firm for New York, Massachusettes and Rhode Island. Its former chairman Harry Trueheart is the current Chair of Terralex.

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Mediation FAQ 3

May statements made during mediation ever be used in court? Unless the commission of a crime is disclosed, or the intention to commit a crime, statements made during a mediation are regarded as statements made during the course of settlement negotiations, which are protected by the doctrine commonly referred to as ‘without prejudice’.

These disclosures cannot be used as evidence in Court, to the extent that they are actually made in good faith, and for the purposes of settlement. This aids the mediation process, as it enables parties to play open cards with one another without fear that their disclosures will later be presented as evidence in Court.

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Mediation FAQ 2

Is mediation confidential? Yes. Nothing that is said during mediation may be disclosed to outside third parties without consent. Documents, other than those which are subject to ‘discovery’, (i.e. which are in any event required to be disclosed in court proceedings) cannot be used in Court, or in any other manner against a party to the mediation.

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Simon Cooper

Our former Managing Partner Simon Cooper recently celebrated 10 years of theatrical and musical productions at his Kalk Bay Theatre which has become a landmark of the arts in Cape Town. Congratulations Simon Cooper!

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Youth Day on Monday

A youth is to be regarded with respect. How do you know that his future will not be equal to our present? – Confucius

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2014 FIFA World Cup

The 2014 FIFA World Cup kicks off today in Brazil. The tournament, which occurs every four years, will run from 12 June 2014 to 13 July 2014. FIFA celebrates its 20th World Cup tournament this year!

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Book Review - Applied Law for Police Officials

Book Review
APPLIED LAW FOR POLICE OFFICIALS

(546 pages)
By C. Joubert
[Fourth Edition]
Juta & Co. Ltd – www.jutalaw.co.za

“There are not enough jails, not enough policemen, not enough courts to enforce a law not supported by the people.”
– Hubert Humphrey (1911 – 1978)

Review by Louis Rood, BA LLB, Chairman of Fairbridges Attorneys.
The fourth edition of this comprehensive book (also published by Juta in Afrikaans as Toegepaste Reg vir Polisiebeamptes) is an essential tool for not only members of the South African Police Service, but all citizens and organisations involved in the prevention and prosecution of crime.

The Constitution mandates the police to uphold safety and security for all in the country. Major General Leon Gossman, Head of the General Research and Curriculum Development Division of SAPS, considers this book as a work of reference that will “adequately equip police officials with hands-on knowledge of legislation to allow them to make informed legal and investigative judgments in the execution of their duties… It will support the nurturing of a new generation of police officials and enhance professionalism in the South African Police Service”.

The 20 chapters deal clearly and logically with policing powers and responsibilities, criminal prosecution, offences against person and property, the criminal justice process, arrest, detention and the use of force, bail, the law of evidence and numerous other key elements of policing. Relevant statutes and case law are set out, together with extracts from the Criminal Procedure Act and the Child Justice Act.

Author Cerita Joubert B Iur LLB (Unisa) LLM (Leiden) ND Pol Admin (TSA) highlights the importance of effective co-operation between an investigating officer and the victim of crime, other witnesses and the prosecutor, all of which will greatly improve the prospects of a successful criminal prosecution.

“Adv Cerita Joubert must be commended for her proficiency in updating and enhancing this publication and the South African Police Service must be lauded for every endeavour to empower police officials in the proper fulfilment of their duties.”
– Judge P.J.Schabort

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Forfeiture of leave benefits

In the recent judgment of Ludick v Rural Maintenance (Pty) Ltd the Labour Court was called upon to decide between two conflicting judgments. The case dealt with whether annual leave pay not taken within 18 months of the beginning of an employee’s leave cycle should be forfeited. The court decided that leave governed by the Basic Conditions of Employment Act, which applies only to the statutory minimum of 15 days per year, would be forfeited if not taken within this time period.

Employers and employees cannot contract out of this. However, any leave given by the company over and above this minimum is considered contractual leave and the company itself will have to insert a forfeiture provision if it does not want this leave to be accumulated indefinitely.

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Labour Court Judgment

In the recent judgment of Ludick v Rural Maintenance (Pty) Ltd the Labour Court was called upon to decide between two conflicting judgments. The case dealt with whether annual leave pay not taken within 18 months of the beginning of an employee’s leave cycle should be forfeited.

The court decided that leave governed by the Basic Conditions of Employment Act, which applies only to the statutory minimum of 15 days per year, would be forfeited if not taken within this time period. Employers and employees cannot contract out of this.
However, any leave given by the company over and above this minimum is considered contractual leave and the company itself will have to insert a forfeiture provision if it does not want this leave to be accumulated indefinitely.

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Surrogacy

SURROGACY: Did you know that it is unlawful to artificially fertilize a surrogate mother until a surrogate agreement dealing with the in’s and out’s of the surrogacy has been authorized by the Court? Failing endorsement, the child is deemed that of the surrogate.

See the Section 292 and Section 295 of the Childrens Act 38 of 2005 and Ex Parte MS and Others [2014] 2 ALL SA 312 GNP, where an agreement was endorsed by the Court 33 weeks after conception. http://www.legalbrief.co.za/article.php?story=20140508105029481

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Deirdre Olivier

Hear our expert in evictions and land invasions, Deirdre Olivier, a director of our Dispute Resolution Division, in an interview with John Maytham on 567 Cape Talk Radio

https://soundcloud.com/primediabroadcasting/deirdre-olivier-on-the-legality-of-the-evictions?utm_source=soundcloud&utm_campaign=share&utm_medium=email

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Mediation FAQ 1

Mediation FAQ 1: What is mediation? This is a private process, conducted outside of court, and is particularly useful in commercial disputes. The parties, assisted by an independent mediator, negotiate to reach a mutually acceptable settlement of their dispute.

It is less focused on what the law dictates, and more concerned with certainty, commercial reality, containment of legal costs and the preservation of relationships. It allows the parties to reach a settlement that suits their own commercial relationship, in the knowledge that failure to do so will result in the decision being placed before an outside party, whose hands are literally tied by the law.

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Mediation FAQs

Look out for our upcoming series of Mediation FAQs – where our own Natasha Steinberg shares insights and practical advice on the mediation process in South Africa.

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Monetary Jurisdication

The monetary jurisdiction of the Magistrate’s Courts increased yesterday, with the District Courts’ increasing from R100000 to R200000, andthe Regional Courts’ from R300000 to R400000. This means that claims of these amounts or less need no longer be brought in the High Courts, with their concomitant expense and delay.

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Herman Conradie

Who’s who in the Fairbridges Zoo – Herman Conradie, a Director at Fairbridges, specialising in Medical Law , Employment Law and Litigation. http://www.fairbridges.co.za/attorneys/5

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Trust Responsibility

In the recent judgment of Investec Bank Ltd v Adriaanse and Other NNO 2014(1) SA 84 (GNP), Judge Jody Kollapen found that it is the primary responsibility of a trust to satisfy itself that a contract it intends concluding (in this instance a suretyship contract) is for the benefit of the trust and its beneficiaries.

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"Simply creating just laws does not create a just society - it only gives us a legal framework by means of which we can discipline those whose behaviour deviates from this just law" - Deon Rossouw, CEO of the The Ethics Institute of South Africa

“Simply creating just laws does not create a just society – it only gives us a legal framework by means of which we can discipline those whose behaviour deviates from this just law” – Deon Rossouw, CEO of the The Ethics Institute of South Africa

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Kievits Kroon Country Estate (Pty) Ltd v Mmoledi and Others (2013)

South Africa’s diverse cultural heritage has again come under the spotlight in the case of Kievits Kroon Country Estate (Pty) Ltd v Mmoledi and Others (2013) where the Supreme Court of Appeal (SCA) had to decide whether the certificate of a traditional healer could be equated with a medical certificate for the purposes of sick leave.

The dispute was originally referred to the CCMA, which found that it was justified for Mrs. Mmoledi to stay away from work to attend a traditional healer’s course, despite her employer’s instructions not to do so, as she was deeply afraid of suffering serious misfortune if she failed to respond to the call of her ancestors.
This was equated to a sickness. The SCA agreed with these findings and dismissed the employer’s appeal. World Health Organisation statistics show that up to 80% of South Africans turn to traditional healers for their physical, spiritual and emotional well-being.

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First for Women commercial was not a negative stereotype of all men!

The Advertising Standards Authority(“ASA”) recently ruled that a First for Women commercial was not a negative stereotype of all men and that the depiction of men as irresponsible and negligent drivers was in fact reasonable and justifiable. The complainant claimed that the First for Women commercial was sexist and offensive to men. The court noted that a hypothetical reasonable person would accept that advertisers use a certain amount of humour and exaggeration and as such would interpret the commercial with a proverbial “pinch of salt”. The Directorate has previously ruled in favour of First for Women on a similar complaint. http://www.asasa.org.za/ResultDetail.aspx?Ruling=6815

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The Employment Tax Incentive

The Employment Tax Incentive (more commonly referred to as the youth wage subsidy) has already created 56000 jobs, according to the latest Budget Speech. The subsidy gives a tax incentive to employers for hiring young South Africans between the ages of 18 and 29, provided these employees earn between R2000 and R6000 per month. The subsidy aims to provide young people with work experience in order to make them more attractive to potential employers.

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Sugar Tax

The Department of Health is considering introducing a sugar tax to encourage South Africans to take responsibility for their own health and make changes to their diet and lifestyle. The Global Cancer Report 2014 notes that body fat increases the risk of cancer of the oesophagus, colon, pancreas, endometrium and kidneys, as well as breast cancer in post-menopausal women.

“Among the dietary factors related to excess body weight, reduction of consumption of sugar-sweetened beverages (SSB) should be a high priority.” Although it is not yet certain whether a sugar tax will be feasible, tax on SSBs has been introduced successfully in France and Mexico. https://sait.site-ym.com/news/167578/Government-considers-sugar-tax-for-South-Africa-and-more.htm

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Quote of the month

“Don’t raise your voices, improve your arguments” – wise advice from Archbishop Emeritus Desmond Tutu

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Mediate in the News!

The Mediation process shall shortly take the spotlight in a bid to find common ground and a negotiated settlement to continued industrial action in the platinum sector. The parties willingness to find a mutually acceptable settlement and the skill and assertiveness of the mediator to assist them to do so may be decisive of the outcome. We’re watching this space with great interest~full report on the Fin24.com site.

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Defamation on social media

A recent judgment by the South Gauteng High Court warns users to be careful when publishing, sharing, commenting on or allowing themselves to be tagged in potentially defamatory online postings. Merely repeating a defamatory statement made by another person also constitutes defamation. Isparta v Richter and Another (2013) ZAGPPHC

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WITS scraps its 4-year LLB

WITS announced last month that it was scrapping its 4-year LLB degree program. This means that students will now have to complete either a three-year BA or BCom degree before enrolling for the 2-year postgraduate LLB program. Whether other South African universities follow suit remains to be seen but the 4-year LLB has been heavily criticised in recent years, with its detractors stating that it does not adequately prepare students for a career in law.

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Consumers easily switch to rivals

“Research shows that 76% of South African consumers switched one of their service providers in the past year due to poor customer service.
http://www.bdlive.co.za/business/retail/2014/04/02/consumers-in-sa-easily-switch-to-rivals”

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US Apartheid Lawsuit

Today marks the deadline for the filing of a complaint in a US lawsuit against Ford and IBM for encouraging race-based human rights abuses in apartheid-era South Africa. Despite limitations being placed on the ambit of the Alien Tort Statute (ATS) (that lets non US-citizens pursue some cases in US courts over alleged violations of international law) in the case of Kiobel et al v. Royal Dutch Petroleum Co et al., US District Judge Shira Scheindlin in Manhattan gave the Plaintiffs a chance to meet the new, tighter standards set by that court. In the Kiobel case it was held that the ATS was presumed to cover only violations of international law occurring in the United States, and that violations elsewhere must “touch and concern” US territory “with sufficient force to displace the presumption.” http://www.fin24.com/Companies/Investment-Holdings/Ford-IBM-face-renewed-apartheid-era-suit-20140418

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Fairbridges History - Henry Arderne

In 1902 the then senior partner of Fairbridges, Henry Arderne, donated the sum of £ 1,250 payable in five annual instalments to the South African College, later the University of Cape Town, to endow a chair of English language and literature. Arderne was a partner of Fairbridges from 1864 to 1908 and a highly respected man. He was well travelled and his visitors book at his house in Claremont was signed by many distinguished persons including the author Rudyard Kipling. Arderne Professors have included Andre P Brink and J M Coetzee and the current Arderne Professor is John Higgens, who was appointed in 2013.

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Clean Power Africa Conference

Cape Town will play host to the Clean Power Africa conference on 13 and 14 May. The conference will take place at the CTICC and deal with the harnessing of hydro, wind and solar power.

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Global Law Experts 2013

Fairbridges has been awarded the Administrative Law Firm of the Year in South Africa for 2013 by Global Law Experts, the leading international online resource for locating specialist legal advisors.

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PMR.Africa: Diamond Arrow Award 2014

Fairbridges is again the highest rated firm in South Africa in its category in the PMR.africa (Professional Management Review) annual independent survey, the fifth time in six years that Fairbridges has achieved the top ranking.

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Fairbridges Wins Big

Congratulations to Fairbridges Amabutho Warriors action soccer team for yet again winning the Five Futbol League (Law Firm Division) beating all the big guns on the way with style, finesse, tenacity and by far the best goal average in this highly competitive
and popular sport. The final league standings were:

1. Fairbridges
2. Norton Rose
3. Bowman Gilfillan
4. Edward Nathan
Sonnenbergs
5. Webber Wentzel
6. Werksmans

We are proud of our team players and their supporters on this well deserved victory.

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Top Billing

Louis Rood has been nominated for the exclusive Litigation position in South Africa on The Lawyer Network, a comprehensive international guide to legal services in over 95 countries.

Andrew Hewitt has been selected by Who’s Who Legal for inclusion in The International Who’s Who of Sport & Entertainment Lawyers 2013 as a leading expert in the specialist category.

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Success Rating

The August 2013 edition of Succeed magazine features lessons in longevity from three of South Africa’s oldest companies, including Fairbridges. The importance of consistency, adaptability and relationship-building is emphasised. Fairbridges Chairman Louis Rood is extensively quoted:

“Sustainability depends on not overpricing services, irrespective of the market conditions. If you remain grounded and take exceptional care of clients and employees, you will not only survive but be ready to take up opportunities when things turn around.”

The ability to build and maintain a lasting brand is no easy challenge. Over a third of small and medium enterprises in South Africa have experienced a threat to their survival in the past year. The article points out that Standard Bank and the City of Cape Town have been Fairbridges’ clients for over 150 years. Louis Rood’s advice: “That only happens if you constantly adapt to the ever changing needs of your clients – and satisfy those needs.”

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Fairbridges and the Chief Justice of of South Africa

Shortly after Fairbridges was founded in 1812, Christoffel Brand, on leaving school at the age of sixteen entered the office of our founder John Merrington and worked there for two years before proceeding to the University of Leiden in the Netherlands. His great-great-grandson was Michael Corbett, Chief Justice of South Africa from 1989 to 1996. He administered the oath to Nelson Mandela when he became President. His son, Peter Corbett, served his articles at Fairbridges from 1984.
On 28 August 1856, Christian Johannes Watermeyer was articled to Charles Fairbridge. His second son was Ernest Frederick “Billy” Watermeyer who became Chief Justice of South Africa from 1943 to 1950, and his grandson HEP “Jack” Watermeyer was Judge President of the Cape from 1979 to 1981.


Carl van der Merwe Rabie served his articles at Fairbridges under Tom Lawton from 1906. He was the father of Pieter Jacobus Rabie who served as Chief Justice of South Africa from 1982 to 1989. His son is Judge Pierre Rabie of the North Gauteng High Court.
In 1936 a committee of four was appointed to revise the Rules of the Supreme Court of South Africa, under the chairmanship of Judge Albert van der Sandt Centlivres. Fairbridges senior partner, Paul Fisher, was one of the committee members. In 1938 the new rules were published by Paul Fisher and Advocate Arenhold with an introduction by Judge Centlivres. A second edition appeared in 1949. Judge Centlivres was Chief Justice of South Africa from 1950 to 1957, and Chancellor of our client, the University of Cape Town.
Newton Ogilvie Thompson was Chief Justice of South Africa from 1971 to 1974. He was the nephew of Fairbridges senior partners, Tom Lawton and his brother Alf Lawton. He was thus first cousin of Wellesley Lawton, Tom’s son, also senior partner, and Dendy Lawton, Alf’s son, who was also at Fairbridges and became a Springbok rugby player. Judge Thompson’s wife was Joyce Newton Thompson, Mayor of the City of Cape Town from 1959 to 1961, and his brother Cyril Newton Thompson, was also a judge from 1946 to 1958.

Fairbridges is proud to have been a training ground for many generations of lawyers and their descendants, and we hope to continue doing so for many years to come.

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The State Attorney

“Nothing in all the world is more dangerous than sincere
ignorance and conscientious stupidity.”
– Martin luther King (1929 – 1968)

An important function of our courts was illustrated in a recent full bench decision of three judges in the North Gauteng High Court in Pretoria. An application for committal for contempt of court had been brought against the National Department of Transport, the director-General of Transport, and the Minister of Transport. The judges called it “exceptionally  unwise” that neither the department of Transport nor its director-General had delivered any answering affidavits. “This appears to be a startling dereliction of duty.” 

But the greatest criticism was reserved for Ms lithole of the office of the State Attorney in Pretoria. The court described her replying affidavit as “disgraceful”. They observed that in “a ludicrous attempt to justify her conduct” Ms lithole had disclosed in her affidavit that the office of the State Attorney in Pretoria was, to use her own word, “dysfunctional”. The court called this a “shocking state of affairs.” She offered only “a cursory apology.” Judge Tuchten said: “The explanation, if it may so be described, that Ms Lithole does not read the emails addressed to her by other attorneys relative to the matters which she is handling, is most disturbing. It appears to us, moreover,
to constitute unprofessional conduct on her part… I deprecate strongly the conduct of Ms Lithole as disclosed in her own affidavits before us and the correspondence admittedly sent and received. Her conduct seriously prejudices the administration of justice. Even more importantly, the dysfunctionality to which she refers demonstrates that the office of the state attorney, Pretoria, an important organ of state, is presently unable to comply with its constitutional and statutory obligations.” 

The judge concluded: “The ultimate responsibility in law to put matters right and ensure that the Office of the State Attorney Pretoria, complies with its constitutional and statutory obligations, rests on the Minister of Justice.”

In the order which it made, the court referred the judgment not only to the Minister of Justice and Constitutional development and the Parliamentary Portfolio Committee on Justice and Constitutional development, but also to the law Society of the northern Provinces “with the request that the Law Society investigate the conduct of Ms Constant Litholi as appears from this judgment with a view to taking such action as the Law Society may consider appropriate.” 

It is clearly a matter of great public concern that our courtsare compelled to go to such lengths. on the other hand, it demonstrates again how important it is for our courts to fearlessly exercise their role in our constitutional democracy.

Tasima (Pty) Ltd v. Department of Transport & Others 2013 (4) SA 134 (GNP). 

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Constitutional Law

“There are three ingredients in the good life:
learning, earning and yearning.”
– Christopher Morley (1890 – 1957)

Judge Plasket sitting in the Eastern Cape High Court in Grahamstown has given an important judgment concerning the fundamental right of children attending public schools to a basic education. This is enshrined, without qualification, in Section 29(1)(a) of the Constitution, which states that everyone has the right “to a basic education, including adult basic education.”

Asked to compel the South African Minister of Basic education, her director-General, the MeC for Basic education and the head of his department in the eastern

Cape Province not only to declare that posts had been established for both teaching staff and non-teaching staff for public schools in the province, but to fill those posts, Judge Plasket pointed out:

“At the heart of the problem lies the long-standing failure of the Provincial Department of Basic Education to attend to post provisioning. This failure has endured for over a decade. The result is that some schools have more teachers than necessary, while others have too few teachers, with consequent prejudicial effects on teaching and learning. As the Provincial
Department failed to take steps to transfer surplus teachers to where they were required, the budget spiralled out of control
because teachers at under-resourced schools were appointed to fill vacant posts on a temporary basis. 

“This created its own set of problems when, in order to cut costs, the Provincial Department dismissed some 4000 temporary teachers, only to be compelled by the court to reinstate them. Other casualties of this abject lack of management were the school nutrition programme, which provided a meal a day for schoolchildren, and the school transport scheme, which allowed for scholars to be conveyed to and from school instead of having to walk long distances.” 

The judge said that it was no exaggeration to say that this was “a crisis of immense and worrying proportions.” 

If the administration and support functions of a school cannot perform properly because of staff shortages, it has a knock-on
effect threatening the right to basic education enshrined in Section 29(1)(a) of the Constitution. The judge referred to the Public Service Act of 1994 which governs the appointment of non-teaching staff and to the Employment of Educators Act of 1998, as well as the South African Schools Act of 1996. The result of this legislation is that the Provincial MeC is empowered and obliged to determine the establishment requirements for both teaching staff and non-teaching staff at public schools in the province. The judge ordered that those posts be declared and be filled by specified dates.

Centre for Child Law & Others v. Minister of Basic Education & Others 2013 (3) SA 183 (ECG). 

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The Survivor´s Guide for Candidate Attorneys (2nd Ed, 2013) By Bhauna Hansjee & Fahreen Kader

 All Candidate Attorneys are required to serve a period of articles, usually two years, before becoming eligible to be admitted to practice. during that time they must pass the Attorneys’ Admission exams. More importantly, they have the opportunity for practical training under a principal attorney. It is a period where the aspirant attorney learns the trade, gains experience, and becomes familiar with the daily demands of a professional career. 

This completely revised and updated second edition of the popular handbook for candidate attorneys effectively bridges the
gap between the university campus, with its emphasis on theoretical knowledge, and the working environment, which requires hands on application of that knowledge. Written in a user-friendly style, there are handy checklists, helpful hints and plenty of sensible advice on just about everything the young candidate should know.

From time management to office behaviour, from conducting consultations to court appearances, from time-keeping to billing procedures, dealing with sheriffs and briefing advocates, this guide spells out common sense on every page.

A directory of courts and other bodies such as Bargaining Councils, the Public Protector, Family Advocates, deeds offices and the National Consumer Tribunal are included, as well as useful websites. Continuous legal education and lifelong learning is an inherent part of a career in the law. This excellent book is the ideal companion to instil that in fledgling practitioners from the outset.

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Law of Succession

“Most usually our virtues are only vices in disguise.”
– Francois, duc de la Rochefoucauld (1613 – 1680)

The Supreme Court of Appeal in Bloemfontein has heard a case where in terms of a will money had been left to a trust with the sole purpose of providing bursaries to assist white students completing a Master’s degree in organic Chemistry at four South African universities. It was further provided in the will that if the trustees were unable to carry out the terms of the trust, the trust income had to be distributed to certain named charities.

When all of the four South African universities declined to participate in the racially discriminatory nature of the bequest, the trustees approached the Western Cape High Court in Cape Town for an order that the discriminatory word “white” be deleted from the bequest in order to make it acceptable to the universities, thereby allowing the purpose of the bursaries to be achieved.

Acting Judge derek Mitchell in the Cape Town High Court decided that the trust income should go to the charities as set out in the will. The trustees appealed this decision.

The five judges hearing the appeal observed that although the attitude of the trustees and the purpose of the bursaries were commendable, this could not be decisive in giving effect to the terms of the will. Because the will had expressly provided that should it prove impossible to give effect to the provisions of the bursary bequest, the money had to go to the charitable organisations. There was accordingly provision for the eventuality which transpired when the universities refused to accept bequests because of the discriminatory conditions. Giving the trust income to the charities named in those circumstances was to give effect to the wishes of the deceased as set out in her will.

In Re BOE Trust Ltd & Others NNO 2013 (3) SA 236 (SCA). 

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Social Networks

“It takes your enemy and your friend, working together, to hurt you to the heart; the one to slander you and the other to get the news to you. ” – Mark Twain (1835 – 1910)

In one of his last judgments in the South Gauteng High Court in Johannesburg before being appointed to the Supreme Court of Appeal, Judge Nigel Willis considered the lawfulness of a posting on Facebook.

The respondent had posted a letter to the applicant on the public social networking site. That led to the applicant asking the court for an order preventing such further conduct on the part of the respondent and for an order requiring her to remove the postings already made. The applicant complained that the posting in question made allegations which were defamatory of him, in particular that he does not provide financially for his family, that he would rather go out drinking than caring for his family, and that he had a problem with drugs and alcohol.

The judge observed: “We have ancient, common law rights both to privacy and to freedom of expression. These rights have been enshrined in our Constitution. The social media, of which Facebook is a component, have created tensions for these rights in ways that could not have been foreseen by the ‘old authorities’ or the founders of our Constitution. It is the duty of the courts harmoniously to develop the common law in accordance with the principles enshrined in our Constitution. The pace of the
march of technological progress has quickened to the extent that the social changes that result therefrom require high levels of skill not only from the courts, which must respond appropriately, but also from the lawyers who prepare cases such as this for adjudication. ” 

The judge pointed out that in our law, it is not good enough, as a defense to or a ground of justification for a defamation, that the published words may be true. It must also be to the public benefit or in the public interest that they be published. A distinction must always be kept between what is “interesting to the public” as opposed to “what it is in the public interest to make known. ” The judge was satisfied that it was neither to the public benefit nor in the public interest that the words about which the applicant complained be published, even if it were accepted that they are true. The respondent claimed that the words complained of were “fair comment”. Judge Willis disagreed. She had been unable to justify her posting. He pointed out that malice or improper motive by the perpetrator of the comment also acts to defeat the defense of fair comment. The background to the posting, together with the words themselves, indicated that the respondent had acted out of malice when she posted the offending comments.

The judge ordered the respondent to remove all postings which she had posted on Facebook or any other site in the social media which referred to the applicant.

“Not only can items be posted and travel on the electronic media at a click on a computer in a moment, in an instant, at the twinkling of an eye, but also they can, with similar facility be removed therefrom. This can also be done at minimal cost. The situation is qualitatively different from the scenario when newspapers have been
or are about to be printed in hardcopy and distributed. The law has to take into account changing realities not only technologically but also socially or else it will lose credibility in the eyes of the people. Without credibility, law loses legitimacy. If law loses legitimacy, it loses acceptance. If it loses acceptance, it loses obedience. It is imperative that the courts respond appropriately to changing times, acting cautiously and with wisdom. ” 

Judge Willis quoted an article published in 1890 in the Harvard Law Review:

“Political, social and economic changes entail the recognition of new rights, and the common law, in its eternal youth, grows to meet the demands of society.” 

Former Chief Justice Michael Corbett was also quoted as an authority in a judgment which he handed down twenty years ago in 1993 in the Supreme Court of Appeal, where he said: “In a case of publication in the press of private facts about a person, the person’s interest in preventing the public disclosure of such facts must be weighed against the interest of the public, if any, to be informed about such facts.”

Finally, Judge Willis had this advice: “Those who make postings about others on the social media would be well advised to remove such postings immediately upon the request of an offended party. It will seldom be worth contesting one’s obligation to do so. After all, the social media is about building friendships around the world, rather than offending fellow human beings. Affirming bonds of affinity is what being ‘social’ is all about.”

H v. W [2013] 2 All SA 218 (GSJ).

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Administrative Law

“The world is disgracefully managed,
one hardly knows to whom to complain.”
– Ronald Firbank (1886 – 1926)

A High Court order which evicted a number of men, women and children from a certain block of flats in Jeppe Street, Johannesburg which they unlawfully occupied, gave the City of Johannesburg six months to make suitable arrangements to provide them with temporary shelter. eight months later, the court suspended the first order to allow the City more time to make the required arrangements.

When neither order was complied with, an application was made for a further order that would hold the executive Mayor, City Manager and director of Housing of Johannesburg personally responsible for ensuring that the City adhered to the earlier order.

Judge Kathy Satchwell set out the position:

“The obligation to shelter the occupiers has not been suddenly sprung upon the City of Johannesburg. Nothing  has leapt out of the blue. There has been a gradual process of enlightenment. There has been opportunity to absorb both the general and specific import of the court decision. There has been opportunity to understand and appreciate the role which the City is required to play in sheltering these occupiers. There has been opportunity to prepare the appropriate response to the obligations which the Constitution and our courts have placed upon the City.” 

The City had to act in a constitutional and professional manner and could not simply throw up its hands and cry “impossible
task”. Judge Satchwell ordered that the City and its officials were obliged to comply with the earlier court orders, directed
them to take the required administrative steps, suspended the eviction order of the occupiers pending compliance by the officials with the judge’s directions and ordered the City of Johannesburg to pay the costs of the application on the punitive scale as between attorney and client.

This case is a good example of the Judicial arm of government exercising its powers to compel the executive arm of government, in this case at Municipal level, to meet its constitutional and legal obligations not only in the interests of those it is required to serve, but also to ensure compliance with the rule of law. The judge went further and said that if the City officials failed again to comply with her orders, the occupiers were given leave to enrol the application again on five days’ notice for a hearing on and determination of any complaint for contempt of court or claims for constitutional damages.

Hlope & Others v. City of Johannesburg & Others 2013 (4) SA 212 (GSJ). 

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Professional Negligence

“I slept, and dreamed that life was Beauty;
I woke, and found that life was Duty.”
– Ellen Hooper (1816 – 1841)

The Supreme Court of Appeal recently had to evaluate the conduct of the conveyancing attorney of a seller of immovable property. There had been certain errors and mistakes which resulted in a considerable delay for bonds to be cancelled, as a result of which claims for damages were instituted.

Appeal Judge eric leach who delivered the judgment pointed out that not every act which causes harm to another gives rise to an action for damages.

The act complained of must be wrongful. That was conceded, so the court simply had to look at whether the conveyancing attorney had been negligent.

The judge observed: “Like any other professional, a conveyancer may make mistakes. But not every mistake is to be equated with negligence, and if a claim against a conveyancer is based on negligence, it must be shown that the conveyancer’s mistake resulted from a failure to exercise that degree of skill and care that would have been expected by a reasonable conveyancer in the same position.” 

He went on to point out that of course the gravity and likelihood of potential harm will determine the steps, if any,  which a reasonable person should take to prevent such harm occurring. Moreover, the more likely the harm the greater is the obligation to take such steps. no hard and fast rules can be prescribed. each case is to be determined in the light of its particular facts and circumstances. “But in the case of a conveyancer, it is necessary to remember that any mistakes which may lead to a transaction in the Deeds Office being delayed will almost inevitably cause adverse financial consequences for one or other of the parties to the transaction. … To avoid causing such harm, conveyancers should therefore be fastidious in their work and take great care in the preparation of their documents. Not only is that no more than common sense, but it is the inevitable consequence of the obligations imposed (by the Deeds Registries Act of 1937 and its Regulations) which oblige conveyancers to accept responsibility for the correctness of the facts stated in the deeds or documents prepared by them in connection with any application they file in the deeds office.” 

Judge leach concluded that the conveyancer had acted negligently. The potential of harm caused by a delay in the event of the application for cancellation of the bonds being defective was “obvious”. That harm could have been simply averted. The standard of care exercised “fell well short of what is expected of a reasonable conveyancer.” The judge expressed a critical view of this conduct. He said that “ . . . the inference is irresistible” that the conveyancer failed to check the documents. This evidenced “a slothful approach to the important task of ensuring that documents accord with the deeds office’s current practices and requirements.” He said that the excuse offered “is lame in the extreme.”

Margalit v. Standard Bank of South Africa Ltd & Another [2013] 2 All SA 377 (SCA). 

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Social Networks

“It takes your enemy and your friend, working together, to hurt you to the heart; the one to slander you and the other to get the news to you. ” – Mark Twain (1835 – 1910)

In one of his last judgments in the South Gauteng High Court in Johannesburg before being appointed to the Supreme Court of Appeal, Judge Nigel Willis considered the lawfulness of a posting on Facebook. The respondent had posted a letter to the applicant on the public social networking site. That led to the applicant asking the court for an order preventing such further conduct on the part of the respondent and for an order requiring her to remove the postings already made.

The applicant complained that the posting in question made allegations which were defamatory of him, in particular that he does not provide financially for his family, that he would rather go out drinking than caring for his family, and that he had a problem with drugs and alcohol.

The judge observed: “We have ancient, common law rights both to privacy and to freedom of expression. These rights have been enshrined in our Constitution. The social media, of which Facebook is a component, have created tensions for these rights in ways that could not have been foreseen by the ‘old authorities’ or the founders of our Constitution. It is the duty of the courts harmoniously to develop the common law in accordance with the principles enshrined in our Constitution. The pace of the
march of technological progress has quickened to the extent that the social changes that result therefrom require high levels of skill not only from the courts, which must respond appropriately, but also from the lawyers who prepare cases such as this for adjudication. ” 

The judge pointed out that in our law, it is not good enough, as a defense to or a ground of justification for a defamation, that the published words may be true. It must also be to the public benefit or in the public interest that they be published. A distinction must always be kept between what is “interesting to the public” as opposed to “what it is in the public interest to make known. ” The judge was satisfied that it was neither to the public benefit nor in the public interest that the words about which the applicant complained be published, even if it were accepted that they are true. The respondent claimed that the words complained of were “fair comment”. Judge Willis disagreed. She had been unable to justify her posting. He pointed out that malice or improper motive by the perpetrator of the comment also acts to defeat the defense of fair comment. The background to the posting, together with the words themselves, indicated that the respondent had acted out of malice when she posted the offending comments.

The judge ordered the respondent to remove all postings which she had posted on Facebook or any other site in the social media which referred to the applicant.

“Not only can items be posted and travel on the electronic media at a click on a computer in a moment, in an instant, at the twinkling of an eye, but also they can, with similar facility be removed therefrom. This can also be done at minimal cost. The situation is qualitatively different from the scenario when newspapers have been
or are about to be printed in hardcopy and distributed. The law has to take into account changing realities not only technologically but also socially or else it will lose credibility in the eyes of the people. Without credibility, law loses legitimacy. If law loses legitimacy, it loses acceptance. If it loses acceptance, it loses obedience. It is imperative that the courts respond appropriately to changing times, acting cautiously and with wisdom. ” 

Judge Willis quoted an article published in 1890 in the Harvard Law Review:

“Political, social and economic changes entail the recognition of new rights, and the common law, in its eternal youth, grows to meet the demands of society.” 

Former Chief Justice Michael Corbett was also quoted as an authority in a judgment which he handed down twenty years ago in 1993 in the Supreme Court of Appeal, where he said: “In a case of publication in the press of private facts about a person, the person’s interest in preventing the public disclosure of such facts must be weighed against the interest of the public, if any, to be informed about such facts.”

Finally, Judge Willis had this advice: “Those who make postings about others on the social media would be well advised to remove such postings immediately upon the request of an offended party. It will seldom be worth contesting one’s obligation to do so. After all, the social media is about building friendships around the world, rather than offending fellow human beings. Affirming bonds of affinity is what being ‘social’ is all about.”

H v. W [2013] 2 All SA 218 (GSJ).

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Animal Protection Act

“If we stop loving animals, aren’t we bound
to stop loving humans too?”
– Alexander Solzhenitsyn (1918 – 2008)

Carte Blanche recently aired a piece on the cruel treatment of circus animals. Protesters were seen outside Brian Boswell’s circus in Johannesburg after the show. A less public part of the campaign against performing circus animals played out in the
North Gauteng High Court.

An old piece of legislation – the Performing Animals Protection Act of 1935 – provides that no one may train or exhibit performing animals without a licence issued by a magistrate. the Minister of Agriculture, forestry and fisheries is responsible for Administering this legislation.

The National Society for Prevention of Cruelty to Animals (NSPCA) brought an application to have the relevant provisions of the Performing Animals Protection Act declared unconstitutional. the NSPCA argued that licences should be issued by the Department of Agriculture and not by a magistrate. the Act, said the NSPCA, blurred the lines between he judiciary and the executive, and breached the important constitutional principle of the separation of powers.

the high Court agreed, pointing out that the legislature makes laws, the judiciary interprets laws and the executive  implements laws. the independence of the judiciary is compromised if magistrates are expected to perform executive functions, such as the granting of licences. In the past, there was a “do it all” approach to magistrates, who were required to exercise a range of powers which more properly belonged with
government. the Constitution changed this, bringing about a firm separation of powers.

The high Court ordered that the relevant provisions of the Performing Animals Protection Act were invalid and gave the Department of Agriculture six months to amend the Act to remove this illegality. Legislation may only be finally declared constitutionally invalid by the Constitutional Court, so the order was also made subject to confirmation by the Constitutional Court. Interestingly, it was also ordered that, pending the Constitutional Court’s decision, licence applications for  performing circus animals should be made to a committee comprising representatives of the NSPCA, the Department of Agriculture and the South African Veterinary Council.

the Constitutional Court has now confirmed the invalidity of the sections of the Act in question, and has given Parliament the opportunity to amend the Act to cure the defect. But in the interim, Magistrates will continue to perform the function of issuing animal training and exhibition licences.

National Society for the Prevention of Cruelty to Animals v. the Minister of Agriculture, Forestry and Fisheries (North Gauteng high Court, Case No. 44001/2012, 15 November 2012). 

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From the Courts: Municipal Law

“There is no debt with so much prejudice put off as that of justice.”
– Plutarch (46 – 120 AD)

Before the adoption of the interim Constitution, rural landowners were not required to pay municipal rates, as rural properties did not fall within the area of jurisdiction of municipalities. this position changed with the transition to democracy and the introduction of ‘wall-to-wall’ municipalities. t

The Bergrivier Municipality levied charges against rural landowners within their municipal area from December 2000. The rural landowners refused to pay certain of the rates and levies imposed, but did not approach a court to adjudicate their dispute.

The Municipality sued the rural landowners for payment and the matter eventually reached the Constitutional Court. the defences raised by the rural landowners were of a technical nature and were dismissed by the Constitutional Court. the court found that municipal rates and levies imposed on rural landowners by the Bergrivier Municipality had been validly charged.

The court took the opportunity to note that municipalities have the power to raise revenue in order to finance the performance of municipal functions – including the provision of sustainable services and meeting the basic needs of a community. Municipalities have a constitutional right and duty to raise revenue (by imposing rates and service charges, amongst other things) in order to provide these services. the members of the community have a reciprocal right to access municipal services and a reciprocal duty to pay rates and service charges.

The Bergrivier Municipality had suffered a significant reduction in income as a result of the unlawful conduct of the rural landowners. this resulted in the municipality being unable to effectively meet its constitutional obligations to the rest of the local community. In fact, there had been no contention by the rural landowners that the Municipality failed to comply with its obligation to provide services – services from which the rural landowners had benefited.

The court noted that, even in cases where communities have genuine grievances with municipalities, they cannot take the law into their own hands by withholding payment of rates and service charges. this kind of conduct can result in chaos and lawlessness; circumstances in which local government cannot function efficiently and effectively. It is not for disgruntled individuals to decide what the appropriate relief should be
and to attempt to ‘punish’ local government by withholding payments due. That is the prerogative of the courts.

Jacobus Johannes Liebenberg N.O. and 84 Others v. Bergrivier Municipality (Minister for Local Government and Environmental Affairs and Development Planning, Western Cape Intervening), CCT 104/12 {2013} ZACC 16.

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Fairbridges Has Been Elected Administrative Law Firm of the Year

Fairbridges has been awarded the Administrative Law Firm of the Year in South Africa for South Africa 2012 by international ratings agency, Corporate INTL, confirming our pre-eminent position as the leading administrative law firm in the country.

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