Institution of Legal Proceedings Against Organs of State Bill: briefing

Meeting report

SELECT COMMITTEE ON SECURITY AND CONSTITUTIONAL AFFAIRS
10 October 2001
INSTITUTION OF LEGAL PROCEEDINGS AGAINST ORGANS OF STATE BILL: BRIEFING

Chairperson: Adv De Lange (NA), Mr Mahlangu (NCOP)

Documents Handed Out:
Institution of Legal Proceedings against Organs of State Bill [B65B-99]
Parliament of South Africa: Announcements, Tablings and Committee Reports [No.117-2000] (see Appendix 1)

SUMMARY
The State Law Advisors briefed the Committee on the relevant amendments to the Institution of Legal Proceedings against Organs of State Bill and on the views put to them by the Portfolio Committee. The Bill had been passed by the National Assembly on the 28 September 2001. However, a number of grievances and concerns have been raised by various other Committees.

MINUTES
Institution of Legal Proceedings against Organs of State Bill
At the commencement of proceedings, it was unclear to the Chair whether or not to proceed with the presentation due to the lack of response by Committee members and the failure to reach a quorum. It was suggested by the State Law Advisors, Advocate De Lange and Advocate Labuschagne that they nevertheless be allowed to brief the Chair and those present so as to give the Committee a fair idea of the progress made in the Bill to date, to which the Chair agreed.

At the commencement of the presentation, Advocate De Lange noted that the Bill had been passed by the National Assembly on the 28 September 2001. However, a number of grievances and concerns have been raised by various other Committees. He then handed over to Advocate Labuschagne to continue with the presentation.

Background to the legislation
Adv Labuschagne stated that the technicality and complexity of the Bill hampered its finalisation. In October 1985, the Law Commission submitted a paper to the Justice Portfolio Committee to amend all relevant provisions regarding prescription and the lapsing of time periods within which to inform or institute legal proceedings against an organ of state. However, as a result of numerous objections raised by certain organs of state, the Bill was never produced in Parliament.

In 1995, the Law Commission submitted a supplementary Bill containing a vast number of legislative changes, which was subsequently passed by Parliament in September 1999. The Portfolio Committee then redrafted the Bill, which was passed by the National Assembly in September 2000.

Adv Labuschagne noted that the reason for the delay in finalising this Bill was based on the controversial constitutional court judgement in the Moise case which had only been brought to the National Assembly's attention after the Bill had been passed. The Committee at the time then recommended that the Bill be kept in abeyance pending the outcome of the Constitutional Court's judgement in the Moise matter.

Clause 1
Adv Labuschagne outlined Clause 1 (1)(vii)(a), (b), (c), (d), explaining that the definition of the term "organs of state" incorporated national and provincial departments and a municipality. Also any functionary or institution exercising a power in terms of the Constitution as well as a Commissioner for the South African Revenue Services. Another important feature of the Bill was that the definition of "debt" expressly excluded debts arising out of contractual liabilities.

Clause 2
Clause 2(1) and Clause 2(2)(a) and (b) dealing with the prescription of debts, the amendment and repeal of laws as well as transitional arrangements were comprehensively explained to the Committee.

Clause 2(3) of the Bill, it was advised by Advocate Labuschagne, aimed at applying the Prescription Act to debts incurred prior to and after the enactment of the Bill. The aim and purpose of Clause 4(a) and (b) was to allow the expired portion of the prescription period of a debt to be deducted from the period of prescription as contemplated in terms of the Prescription Act.

In concluding the discussion on Clause 2 of the Bill, Advocate Labuschagne advised that although this Clause was of a very technical nature, its important aspect was that it contained the transitional periods of new debts after the commencement of the Bill.

Clause 3
As regards Clause 3 of the Bill it imposed a duty on a party to notify an organ of state of its intention to institute legal proceedings in writing and within a period of six months. It also allowed for a creditor to apply for condonation should the aforementioned requirements not have been complied with.

Clause 4 and 5
Adv Labuschagne advised that the content of Clause 4 of the Bill dealing with the service of notice and Clause 5 of the Bill dealing with the service of process were self-explanatory and proved non-problematic. This ended his explanation of the proposed amendments to the Bill.

Discussion
According to Adv De Lange one of the prevalent issues was that laws to be amended and repealed contained two objectionable views: firstly, the rules regarding prescriptive periods for an ordinary person and an organ of state was significantly different. And secondly, limitations were imposed on members of the public who wished to institute legal proceedings against an organ of state. He added that due to the vast mass of State administration, an organ of state must be placed in a position to decide sufficiently whether to impose legal proceedings or to settle out of Court.

Mr Lever (DP) asked firstly if Clause 3(3)(a) applied mutatis mutandis to Clause 2. The content of Clause 2 dealt with claims of a delictual nature. Hence, it would only be fair and equitable that a claimant should have had some kind of knowledge of the debt. And, that this requirement of a claimants knowledge and awareness be read simultaneously with the content of Clause 3(3)(a) of the Bill. Was this intended at the time of drafting these Clauses?
Advocate Labuschagne stated that he was unclear as to the answer and requested that he be allowed to research this aspect and revert to the Committee at a later stage.

Secondly he asked what was meant by "good cause" as contained in Clause 4(b)(ii) of the Bill.
Regarding Mr Lever's (DP) question on the term "good cause", Advocate Labuschagne advised that he foresaw no problems herewith and that it should be retained. This view was confirmed by the Portfolio Committee on its last meeting.

Thirdly, why was Clause 2 included at the commencement of the Bill and not at the end. He stated that his opinion was based on the view that Clause 2 of the Bill contained exceptions and therefore would best be placed at the end of the Bill.
Advocate Labuschagne advised that this particular section did not contain exceptions, instead its function was to regulate the prescription period of debts and the repeal of laws. It was not intended to be a sole conditional clause in the Bill. Additionally, that the placement of this Clause in the Bill had been done at the request of the Portfolio Committee.

The Chair then asked the Committee if there was any urgency in finalising the Bill and what the initial reaction of the Portfolio Committee was to the Constitutional Court's ruling in the Moise case.

Advocate De Lange replied that firstly there was no urgency in finalising the Bill and secondly that the Portfolio Committee had required a summary of the Moise judgement. Apart from this, the Portfolio Committee had raised a number of other issues which required adjustments in the Bill and which was still to be decided upon.

The Chair then stated that the definition of "debt" as contained in Clause 1(1)(iii) appeared to be problematic. An issue raised by the Portfolio Committee surrounding this definition was its failure to include debts arising from all causes of actions as contained in the Prescription Act. This was an issue that required review.

Mr Lever (DP) asked if in interpreting the Court would still be obliged to apply its own common law principles. Adv Labuschagne responded that when a court has to interpret a debt, it will do so by referring to Clause 2 and Clause 3.

Mr Lever (DP) why the State should be afforded special considerations since the justification of this Bill was based on the Moise matter? Adv De Lange once again emphasised that the personnel administration of an organ of state was mammoth in fulfilling this task.

Mr Lever (DP) asked if this Bill was a real necessity and expressed the opinion that it afforded organs of state an unfair advantage. Advocate De Lange's response to this question was that the merit of the Bill should be reviewed.

The Chair interjected and asked if it was advisable to continue with discussions and finalise the Bill or should the State Law Advisors be allowed to reconsider and research issues raised.

Advocate De Lange supported the second option and advised that the State Law Advisors be allowed to draft a supplementary report to be placed before the Committee at a later stage. Mr Lever (DP) supported this view.

The Chair advised that a number of issues in the Bill needed reconsideration and rethinking so as to give the Committee a clear guideline of what the Bill aimed to achieve.

The Chair asked the State Law Advisors to approach the Committee upon its completion of the final draft of the Bill.

The meeting was adjourned.

Appendix 1:

Report of the Portfolio Committee on Justice and Constitutional Development on the Limitation of Legal Proceedings against Government Institutions Bill [B65—99] (National Assembly—section 75), dated 20 September 2000, as follows:

The Portfolio Committee on Justice and Constitutional Development, having considered the subject of the Limitation of Legal Proceedings against Government Institutions Bill [B65—99] (National Assembly—section 75), referred to it, submits the Institution of Legal Proceedings against Organs of State Bill [B65B—99] (National Assembly—section 75).
The Portfolio Committee wishes to report further, as follows:

1. During its deliberations on the Bill, the Committee's attention was drawn to the fact that certain provisions of existing laws provide for different—
(a) notice periods for the institution of legal proceedings; and
(b) prescription periods,
in respect of certain debts arising from delictual or contractual liability. The Committee expressed the view that some of those provisions could possibly be unconstitutional.

In order to create uniformity, the Committee deemed it appropriate to repeal existing provisions providing for different notice periods, whether they are possibly unconstitutional or not, and to substitute them with a uniform notice period which will apply in respect of the institution of all legal proceedings against organs of state, as defined in the Bill, arising out of a debt. The Committee, however, further deemed it appropriate to retain certain existing provisions which, for specific reasons, provide for notice periods that differ from the uniform period envisaged by the Bill. By defining debt as "any debt arising from any unlawful act or omission for which an organ of state is liable for payment of damages, including delict or liability without fault in terms of a statutory provision, but does not include a debt arising from a breach of contract", the Bill will not apply in respect of debts arising from contractual liability.

In order to create further uniformity, the Committee deemed it appropriate to repeal certain existing provisions, whether they are possibly unconstitutional or not, which provide for specific prescription periods in respect of certain debts arising from delictual or contract liability. The Committee, however, further deemed it appropriate to retain certain existing provisions which, for specific reasons, provide for prescription periods that differ from the period provided for by the Prescription Act, 1969 (Act No. 68 of 1969). The effect of the repeal of the above-mentioned provisions is that the prescription of all debts arising from delictual or contractual liability will, after the commencement of this Bill and unless otherwise provided for by an existing provision, be regulated by the Prescription Act, 1969.

Due to the fact that no comprehensive review of the provisions providing for different prescription periods has been done and due to a lack of time, the Committee was not in a position to deal with the harmonisation of such different prescription periods on the strength of comprehensive research. Furthermore, because the main object of the Bill is to harmonise, and create uniformity in respect of, the provisions of existing laws providing for different notice periods, the Committee is of the view that the Bill is not the appropriate mechanism to deal with the harmonisation of provisions providing for different prescription periods. The Committee therefore recommends that the Minister for Justice and Constitutional Development be requested to request the Chairperson of the South African Law Commission to consider the possibility of including an investigation into the harmonisation of the provisions of existing laws providing for different prescription periods in the Law Commission's programme.

2. The Bill, as introduced into Parliament, provides for the repeal of section 44 of the Compensation for Occupational Injuries and Diseases Act, 1993 (Act No. 130 of 1993), which provides that "a right to benefits in terms of this Act shall lapse if the accident in question is not brought to the attention of the commissioner or of the employer or mutual association concerned, as the case may be, within 12 months after the date of such accident". Although the Committee considered the repeal or amendment of the said section 44, it expressed the view that it had insufficient time to consider the repeal or amendment of that section properly and any possible consequential amendments to the said Act which might emanate from such repeal or amendment. In the light thereof the Committee recommends that the Department of Labour be requested—

(a) to investigate the repeal or amendment of section 44 with the view to bringing the provisions thereof into line with the provisions of the Bill and to identifying possible consequential amendments to the above-mentioned Act emanating from such repeal or amendment; and
(b) where necessary, to submit draft amendments regarding the matter in question to Parliament for its consideration.

3. The Committee's attention was also drawn to section 23 of the Road Accident Fund Act, 1996 (Act No. 56 of 1996), which provides for the prescription of the right to claim compensation from, among others, the Road Accident Fund, established under section 2(1) of that Act, in respect of "loss or damage arising from the driving of a motor vehicle in the case where the identity of either the driver or the owner thereof has been established". The Committee considered the possibility of repealing the said section 23 and including the Road Accident Fund in the definition of "organ of state" so as to make the provisions of the Bill applicable to that Fund. The Committee is aware of the Road Accident Fund Commission which has been established to "inquire into and to make recommendations regarding a reasonable, equitable, affordable and sustainable system for the payment by the Road Accident Fund of compensation or benefits, or a combination of compensation and benefits, in the event of the injury or death of persons in road accidents in the Republic". It has been brought to the Committee's attention that the Road Accident Fund Commission is required to submit its Report to the President during the course of 2001. In the light of the above the Committee decided against the repeal of the above-mentioned section 23 and the inclusion of the Road Accident Fund in the definition of "organ of state". The Committee recommends that the Department of Transport be requested—
(a) to consider and evaluate any recommendations regarding the matter in question as contained in the Report by the Road Accident Fund Commission; and
(b) where necessary, to submit legislative proposals regarding the matter in question to Parliament for its consideration.

4. The Committee's attention was also drawn to the fact that the Legal Succession to the South African Transport Services Act, 1989 (Act No. 9 of 1989), contains certain provisions providing for specific notice periods in respect of claims for compensation for livestock killed or injured by a train or for property destroyed or damaged by a fire caused by a burning object coming from a locomotive or train. Due to a lack of time, the Committee was not in a position to consider the repeal or amendment of those provisions properly for purposes of uniformity. The Committee therefore recommends that the Department of Transport be requested—
(a) to investigate the repeal or amendment of the above-mentioned provisions with the view to bringing them into line with the provisions of the Bill; and
(b) where necessary, to submit legislative proposals regarding the matter in question to Parliament for its consideration.

5. The Committee's attention was drawn to section 59 of the South African National Roads Agency Limited and National Roads Act, 1998 (Act No. 7 of 1998), which provides for notice periods for the institution of legal proceedings against, among others, the South African National Roads Agency Limited (the Agency) or an employee of the Agency for any damage or loss allegedly suffered by a person as a result of any act with regard to a national road which allegedly was performed or omitted by, among others, the Chief Executive Officer or any of the other employees of the Agency acting in the performance of their duties. Although the Bill, as introduced into Parliament, did not provide for the amendment or repeal of the said section 59, the Committee deemed it appropriate to include an amendment of that section in the Bill so as to make the uniform notice period envisaged by the Bill applicable to legal proceedings emanating from the provisions of the above-mentioned Act as well. The Committee also noted that section 59(3) of the above-mentioned Act provides that "[n]either the Agency nor ..... any person who operates or has constructed a national road, will be liable for any damage or loss suffered by any person through the use of any part of the national road other than the roadway or as a result of the closure or deviation of a national road under this Act." Although the Committee effected consequential amendments to section 59(3), as a result of the repeal of section 59(1) and (2) of the above-mentioned Act, the Committee does not express any views on the constitutionality of the said section.

6. The Committee expresses its concern that it has to amend the Black Administration Act, 1927 (Act No. 38 of 1927), on a piecemeal basis. It was brought to the Committee's attention that on 5 September 2000 the High Court of Pretoria in the case of D E Moseneke and Others v The Master of the High Court (Case No. 20006/2000) declared the provisions of clause 3(1) of the Regulations promulgated in terms of the above-mentioned Act to be invalid, unconstitutional and of no force and effect. In the light of the above, the Committee recommends that each National or Provincial Department, which is responsible for the administration of specific sections of the above-mentioned Act, be requested to review the sections which it administers with the view to bringing those sections in line with the Constitution. The Committee further requests that each of the Departments concerned must submit a report to the Committee on its progress in the above regard within three months after the adoption of this report.