Friday, June 24, 2016
CLASS ACTIONS AND COLLECTIVE REDRESS LITIGATION IN SOUTH AFRICA
Stes de Necker
Class actions, also known as multiparty litigation or collective redress, is typically brought by a group of people collectively claiming for similar injuries or damages from the same organisation or organisations.
Class action litigation is a relatively new area of law in South Africa. Recent developments have opened the way for class actions to gain ground in this country. These include the advent of consumer and environmental protection laws and the Companies Act, 2008, all providing for class actions, as well as landmark court rulings that have established a clearer class action framework.
Although class actions per se do not form part of South Africa’s common law (1), recent legislative reform has paved the way for a new era in multi-party litigation and has created the framework for the institution of collective redress law suits in an ever increasing number of areas of dispute.
This short note draws attention to some of these.
The Constitution of the Republic of South Africa Act, 108 of 1996 (“Constitution”)
Section 38(c) of the Constitution provides that any person can act as a member of a class in approaching a court when alleging that a right in the Bill of Rights has been infringed or threatened.
In giving effect to this section of the Constitution, the Supreme Court of Appeal (SCA) held in Permanent Secretary, Department of Welfare, Eastern Cape v Ngxuza 2001 (4) SA 1184 (SCA) that s 38(c) of the Constitution authorised the use of an American-style class action. It must be emphasised that the use and recognition of a class action in terms of the Constitution has application only in circumstances where a Constitutional right has been infringed or threatened. (2)
The SCA indicated that the requirements for a class action contained in Rule 23(a) of the US Federal Rules of Civil Procedure (the Federal Rules) were applicable in South Africa (certainly insofar as “Constitutional” based class actions are concerned).
Rule 23(a) of the Federal Rules provides that one or more members of a class may sue as representative parties on behalf of all if:
Ø the class is so numerous that joinder of all members is impracticable;
Ø there are questions of law or fact common to the class;
Ø the claims or defences of the representative parties are typical of the claims or defences of the class, and
Ø the representative parties will fairly and adequately protect the interests of the class.
These four requirements are commonly known as ‘numerosity’, ‘commonality’, ‘typicality’, and ‘adequacy of representation’.
Apart from the Constitution, recent legislative reform affords standing to persons to institute actions on behalf of a class when enforcing rights or seeking certain remedies under that legislation.
The Companies Act No. 71 of 2008
Section 157(1) of the new Companies Act which is styled “Extended standing to apply for remedies” provides:
“When, in terms of this Act, an application can be made to, or a matter can be brought before, a court, the Companies Tribunal, the Panel or the Commission, the right to make the application or bring the matter may be exercised by a person –
(b) acting as a member of, or in the interest of, a group or class of affected persons, or an association acting in the interests of its members; or
(c) acting in the public interest, with leave of the court.”
Consumer Protection Act No. 68 of 2008 (“CPA”)
Although not yet in force, Section 4(1) of the CPA contemplates that “a person acting as a member of, or in the interest of, a group or class of affected persons” or “a person acting in the public interest, with leave of the Tribunal or court, as the case may be” may approach a court, the Tribunal or the Commission alleging that a consumer’s rights in terms of the CPA have been infringed, impaired or threatened.
Separately, the CPA also makes provision for accredited consumer protection groups to initiate actions to protect the interests of groups of consumers. Such a group may “commence any act to protect the interests of a consumer individually or of consumers collectively”.
National Environmental Management Act No. 107 of 1998 (“NEMA”)
NEMA makes provision for individuals or groups seeking relief in respect of any breach or threatened breach of any provision of the Act. Section 32 provides:
“Any person or group of persons may seek appropriate relief in respect of any breach or threatened breach of any provision of this Act, including a principle contained in Chapter 1, or of any provision of a specific environmental management Act, or of any other statutory provision concerned with the protection of the environment or the use of natural resources –
(a) in that person’s or group of person’s own interest;
(c) in the interest of or on behalf of a group or class of persons whose interests are affected;
(d) in the public interest; and
(e) in the interest of protecting the environment.”
It remains to be seen how and in what form South African jurisprudence will develop to give practical expression to persons wishing to institute a class action in accordance with the standing afforded in terms of the above mentioned legislation. Although American style class actions and the requirements of Federal Rule 23 have been recognised in South Africa as being apposite in the context of class actions brought under Section 38(c) of the Constitution, it is not entirely clear whether similar provisions will also have application to class actions contemplated under the recently enacted legislation referred to above.
In this context, it is worth remembering that the South African Law Commission recommended in 1998 that class actions should be introduced into South African law by means of legislation and proposed draft “Public Interest and Class Actions Act” (PICA).
To date no legislation of that type has been enacted. This notwithstanding, the proposed PICA contains some important provisions:
Ø A ‘class action’ is defined as an action ‘instituted by a representative on behalf of a class of persons in respect of whom the relief claimed and the issues involved are substantially similar in respect of all members of the class’ (clause 1);
Ø No action shall proceed as a class action unless a court has certified it as such (clause 6(1)). A court may have regard to the following considerations when considering certification (clause 6(2)):
Ø the existence of an identifiable class of persons;
Ø the existence of a prima facie cause of action;
Ø issues of fact or law which are common to the claims of the members of the class;
Ø the availability of a suitable representative to represent the interests of members of the class; and
Ø the interest of justice and whether a class action would be appropriate in the circumstances.
The court which certifies an action as a class action is required to appoint a ‘representative’ to represent the interests of members of the class.
The court may give directions to the representative with regard to the giving of notice to members of the class (clause 8). Such directions may require potential members to ‘opt in’ or to ‘opt out’ of the class action.
Judgment in a class action will generally be binding on all members of the class (clause 10(3)).
The International Trend
In developing procedures for non-constitutional class action disputes, regard should also be had to international trends and developments.
Whilst there are no doubt good arguments to be made that American style class actions should have application, it is interesting to observe that European and UK collective redress mechanisms are steering away from the classic American style class action.
The American system of allowing ‘opt out’ class actions (where a representative sues on behalf of class of unidentified individuals, subject to any member of that class being afforded the right to ‘opt-out’ of the action) has been criticized on a number of fronts.
These include that they contribute to litigation excesses; there are concerns that such actions could be “hijacked” by law firms or various interest groups; and they may also lead to defendants being pressured into accepting highly expensive settlements, regardless of liability.
The European model favours the ‘opt in’ approach which involves the representation of plaintiffs who choose to be a part of the action. This is akin to a group action in which all members of the ‘group’ are identified. (3)
(1) As was recently stated by Traverso DJP in Firstrand Bank Ltd v Chauncer Publications (Pty) Ltd2008 (2) SA 592 (C), save for constitutional matters, “the South African common law does not recognise a class action“
(2) In circumstances where there is no allegation that a constitutional right has been infringed or threatened it is arguable that the High Court’s inherent jurisdiction to regulate its own process taking into account the interests of justice would probably enable it to develop class action procedures.
(3) The Uniform Rules of Court already contain mechanisms for allowing actions involving a multiplicity of plaintiffs and/or defendants and/or causes of action (the “joinder” provisions contained in Rule 10). In a similar vein, the Rules also allow plaintiffs in separate actions to apply for consolidation of actions on the grounds of convenience (Rule 11). These rules provide a basis for group actions at the very least.
Monday, June 20, 2016
AFRICAN UNITY OR BLACK SUPREMACY
WHAT DOES THE SOUTH AFRICAN GOVERNMENT WANT
Stes de Necker
Every day we read about the abuse of state resources by ministers and government officials.
Recently the Minister of Defence used the Defence Force resources at a cost of millions to the taxpayers to airlift a young lady out of the DRC.
When questioned the minister said she did nothing wrong.
How often do we hear those words, “we did nothing wrong.”
President Jacob Zuma and members of the African National Congress (ANC) say it all the time. As usual, the ANC’s bandits rally around and exonerate exposed members from any crime or responsibility.
The sense of entitlement is real, and the Government treats state resources as if they were the sole owners, giving no thought for the poor.
The ANC Government, like most African leaders, are greedy and do not really care about the people.
Leaders cannot lead by example and are only interested in accumulating wealth for themselves.
South Africa used to be the beacons of light on this dark continent, showing the way forward, becoming the financial hub of Africa.
The Whites built South Africa up; they planned the roads; they planned the factories; they grew the food to fed the nation; they developed the mining industry; they were the industrious people who took a land of wild animals and bush and made it the country it was at the time of the handover.
Everyone had access to schooling, further education, health, food and policing. All the cornerstones of any civilised society were present. And then the country was handed over to the ANC Party and today we sit with what we see in front of our eyes - proof that sub-Saharan blacks can't make a success of anything, even when given everything on a silver platter.
They can't create wealth without taking from someone else.
They can't grow food, proved beyond any doubt when once successful farms given to them lie barren and dead, returned to bush.
They can't even maintain the education system, which is now in a mess, with the health system not far behind.
Crime is out of control.
Infrastructure is collapsing.
Farmers are being murdered without government standing up and denouncing the slaughter.
The blacks can't make sport teams on merit and so have to use quota systems to force teams to incorporate them.
They can't get jobs without Affirmative Action being implemented.
In short, the ANC has killed the goose that laid the golden eggs.
Millions of hungry black people are look with big eyes at their leaders who live in obscene luxury whilst they scratch in dirt for food.
South Africa has become a country where it is all about tribalism and status. Leaders are using their fellow man to get to the top, and once there, forget all about them.
Nobody really cares about the high death toll or believes that the country is in a critical state.
South Africa was built up from nothing and considered a first world country. Now the world watches as it is torn down and destroyed. Senior citizens are abused, babies are killed, women are raped, and farmers are murdered. Buildings are destroyed, universities and schools are burned, and chaos erupts into violence in and around townships.
What government will demolish homes and leave their people stranded because the shacks were illegally erected on land earmarked for some development? Throw the people into the cold, let them starve and turn to crime in a battle of survival.
With the aim of ousting all white people (and to some degree the Coloured people as well) the ANC Government is destroying the country economically, socially culturally and politically.
In their endeavour to exclude whites from everything, by passing laws and restricting white people from participating in economic growth, the Government is forcing unemployment of whites to escalate due to affirmative action.
With leaders who change constitutions in their favour so that they can enrich themselves, it is going to take a long time before there is real change in Africa and in particular, South Africa.
Most Africans countries are still in a state of slavery, yet they claim to be independent.
Reality has met the rainbow nation, and it's certainly not looking good.
Sunday, June 5, 2016
A HISTORY WRITTEN IN BLOOD
Stes de Necker
JUST a few years ago, terrorism seemed to be restricted to a few isolated places, such as Northern Ireland, the Basque Country in northern Spain, and some areas of the Middle East.
Now—especially since September 11, 2001, with the destruction of the Twin Towers in New York—terrorism has mushroomed into a worldwide phenomenon, springing up in Brussels; France; Bali; Madrid, Spain; London, England; Sri Lanka; Thailand; and even Nepal. Yet, terrorism is not a new development.
What is meant by the term “terrorism”?
Terrorism has been defined as “the unlawful use or threatened use of force or violence by a person or an organized group against people or property with the intention of intimidating or coercing societies or governments, often for ideological or political reasons.” (The American Heritage Dictionary of the English Language)
However, writer Jessica Stern observes: “The student of terrorism is confronted with hundreds of definitions . . . But only two characteristics of terrorism are critical for distinguishing it from other forms of violence.” What are they? “First, terrorism is aimed at noncombatants. . . .
Second, terrorists use violence for dramatic purpose: instilling fear in the target audience is often more important than the physical result. This deliberate creation of dread is what distinguishes terrorism from simple murder or assault.”
Violence Rooted in the Past
In first-century Judaea, a violent group called the Zealots pushed for Jewish independence from Rome. Some of their most ardent adherents became known as Sicarii, or dagger men, a name that comes from the short swords they hid under their garments. Mingling in Jerusalem’s festival crowds, the Sicarii slit the throats of their enemies or stabbed them in the back.
In 66 C.E., a group of Zealots seized the fortress of Masada near the Dead Sea. They butchered the Roman garrison and made the mountaintop fastness their base of operations. For years they sortied from there and harassed the imperial authorities.
In 73 C.E., the Roman Tenth Legion led by Governor Flavius Silva retook Masada, but they did not conquer the Zealots. A contemporary historian claims that rather than give in to Rome, 960 of them—everyone up there except for two women and five children—committed suicide.
Some view the Zealot revolt as the start of terrorism as we know it. True or not, since then terrorism has left deep tracks in history’s path.
Terrorism with roots in Christendom
Beginning in 1095 and continuing for two centuries, crusader armies repeatedly crossed between Europe and the Middle East. Opposing them were Muslim forces from Asia and North Africa. The issue was control of Jerusalem, and each side tried to gain the advantage.
In their many battles, those “holy warriors” hacked one another to pieces. They also used their swords and battle-axes on mere bystanders.
William of Tyre, a 12th-century clergyman, described the crusaders’ entry into Jerusalem in the year 1099:
“They went together through the streets with their swords and spears in hand. All them that they met they slew and smote right down, men, women, and children, sparing none. . . . They slew so many in the streets that there were heaps of dead bodies, and one might not go nor pass but upon them that so lay dead. . . . There was so much bloodshed that the channels and gutters ran all with blood, and all the streets of the town were covered with dead men.”
In later centuries terrorists began using explosives and firearms with gruesome, fatal results.
On June 28, 1914, the world was plunged into war. This date is viewed by historians as a turning point in European history. A young man, regarded by some as a hero, shot the Austrian crown prince, Archduke Francis Ferdinand. That event brought mankind into World War I. Twenty million deaths later, the Great War ended.
World War I had its sequel in World War II, with its concentration camps, slaughter of civilians in bombing raids, and acts of retribution on innocent people. After the war, murders continued. Over a million people died on Cambodia’s killing fields in the 1970’s. And the people of Rwanda are still reeling from the massacre of over 800,000 in the 1990’s.
From 1914 to our time, mankind has suffered from terrorist activity in many countries. Yet, some people today act as if history had no lessons for modern man.
On a regular basis, terrorist attacks kill hundreds, maim thousands, and rob millions of their right to peace of mind and safety.
Bombs explode in marketplaces, villages burn to the ground, women are raped, children go into captivity, people die.
In spite of laws and universal condemnation, this sadistic routine just doesn’t stop.
The question remains, is there hope that terrorism will ever end?