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Ferreira v Levin NO and Others; Vryenhoek and Others v Powell NO and Others (CCT5/95) [1995] ZACC 13; 1996 (1) SA 984 (CC); 1996 (1) BCLR 1 (6 December 1995)

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IN THE CONSTITUTIONAL COURT OF SOUTH AFRICA

 

CASE NUMBER: CCT 5/95

 

 

In the matter between:

 

 

FERREIRA, CLIVE                                                                                                   Applicant

 

 

and

 

 

LEVIN, ALLAN NO                                                                                        1st Respondent

 

 

WILKENS, ANDREW DAVID                                                                         2nd Respondents

COOPER, BRIAN ST CLAIR

VAN DER MERWE, SCHALK WILLEM NO                                                         

In their capacities as the joint

provisional liquidators of Prima

Bank Holdings Limited

 

 

THE MASTER OF THE SUPREME COURT                                                    3rd Respondent

 

and

 

VRYENHOEK, ANN                                                                                            1st Applicant

VRYENHOEK, LUKE JOHN                                                                               2nd Applicant

VRYENHOEK, ANDREW                                                                                   3rd Applicant

 

and

 

POWELL, OLIVER NO                                                                                       1st Respondent

BRETT, JJ NO                                                                                     2nd Respondent

AVFIN INDUSTRIAL FINANCE (PTY) LTD                                              3rd Respondent

 

 

Heard on:       9 May 1995

 

Delivered on: 6 December 1995

 

_____________________________________________________________________

 

                                                                 JUDGMENT                                                               

____________________________________________________________________

 

 

Ackermann J.

 

 

The issues

 

[1]                The two referrals before us (the "Ferreira referral" and the "Vryenhoek referral") were heard together for the sake of convenience (as they were in the Witwatersrand Local Division of the Supreme Court by Van Schalkwyk J) because identical issues arise in both cases. These issues concern the alleged inconsistency of certain provisions in section 417 of the Companies Act, No. 61 of 1973, as amended ("the Act") relating to the examination of persons in winding-up proceedings, with the Constitution of the Republic of South Africa, 1993 ("the Constitution" or "the transitional Constitution"). Section 417 of the Act provides as follows -

"417.   Summoning and examination of persons as to affairs of company.

 

(1)        In any winding-up of a company unable to pay its debts, the Master or the Court may, at any time after a winding-up order has been made, summon before him or it any director or officer of the company or person known or suspected to have in his possession any property of the company or believed to be indebted to the company, or any person whom the Master or the Court deems capable of giving information concerning the trade, dealings, affairs or property of the company.                               

 

(1A)     Any person summoned under subsection (1) may be represented at his attendance before the Master or the Court by an attorney with or without counsel.                          

 

(2)(a)   The Master or the Court may examine any person summoned under sub-section (1) on oath or affirmation concerning any matter referred to in that subsection, either orally or on written interrogatories, and may reduce his answers to writing and require him to sign them.

 

 

  (b)      Any such person may be required to answer any question put to him at the examination, notwithstanding that the answer might tend to incriminate him, and any answer given to any such question may thereafter be used in evidence against him.

 

(3)        The Master or the Court may require any such person to produce any books or papers in his custody or under his control relating to the company but without prejudice to any lien claimed with regard to any such books or papers, and the Court shall have power to determine all questions relating to any such lien.

 

(4)        If any person who has been duly summoned under subsection (1) and to whom a reasonable sum for his expenses has been tendered, fails to attend before the Master or the Court at the time appointed by the summons without lawful excuse made known to the Master or the Court at the time of the sitting and accepted by the Master or the Court, the Master or the Court may cause him to be apprehended and brought before him or it for examination.

 

(5)        Any person summoned by the Master under subsection (1) shall be entitled to such witness fees as he would have been entitled to if he were a witness in civil proceedings in a magistrate's court.

 

(6)        Any person who applies for an examination or enquiry in terms of this section or section 418 shall be liable for the payment of the costs and expenses incidental thereto, unless the Master or the Court directs that the whole or any part of such costs and expenses shall be paid out of the assets of the company concerned.

 

(7)        Any examination or enquiry under this section or section 418 and any application therefore shall be private and confidential, unless the Master or the Court, either generally or in respect of any particular person, directs otherwise."

 

Although the matters before us are referrals, and not appeals or applications in the ordinary sense,

the parties will be referred to (and described) as they were in the Court below.

 

 

[2]                In the winding-up of two companies unable to pay their debts, the applicants were summoned for examination ("the section 417 examination" or "the section 417 enquiry") pursuant to the provisions of sub-sections (1) and (2) of section 417 of the Act. During the course of their examination, the applicants in both the Ferreira and the Vryenhoek cases objected to being compelled, by virtue of the provisions of section 417(2)(b), to answer questions put to them which might tend to incriminate them. They applied to the Witwatersrand Local Division of the Supreme Court for a temporary interdict against the respondents, prohibiting the further interrogation of the applicants pending the determination of the constitutionality of section 417(2)(b) of the Act.

 

[3]                On 28 November 1994 Van Schalkwyk J dismissed both the applications for interim relief, granted leave to appeal against such dismissal to the full bench of the Transvaal Provincial Division or the Witwatersrand Local Division, if the Judge President so directed, and referred the following matters to the Constitutional Court in terms of section 102(1) of the Constitution -

"1.       Whether section 417(2)(b) of the Companies Act 68 of 1973, as amended ("the Act"), is unconstitutional in that it compels a person summoned to an enquiry to testify and produce documents, even though such person seeks to invoke the privilege against self-incrimination.

 

 2.        Whether evidence given by a person at an enquiry in terms of section 417 of the Act falls to be excluded in any subsequent criminal proceedings brought against such person where the evidence may be incriminating and was extracted without recognition of such person's privilege against self-incrimination.

 

 3.        Whether a person appearing at an enquiry in terms of section 417 of the Act is entitled to have prior access to:

 

3.1       a copy of the record of the examination of all other persons examined at the inquiry;

3.2       all documents in the possession of the liquidator or those prosecuting                         the inquiry relevant to the interrogation of such person.

 

 

 4.        Whether a person is required to give testimony at an inquiry in terms of section 417 which testimony may tend or have the effect of supporting a civil claim against such person.

 

5.         Whether a person who has given testimony at an enquiry in terms of section 417, which testimony tends to support a civil claim against such person, may have such testimony excluded in any subsequent civil proceedings."

 

The referral took place before the current rules of the Constitutional Court were promulgated on 6 January 1995.

 

[4]                Of the respondents in the two matters, only the second respondent in the Ferreira application and the third respondent in the Vryenhoek application opposed the relief sought and were represented at the hearing in this Court. The third respondent in the Ferreira application (the Master) lodged a memorandum in the form of an affidavit but did not oppose the relief sought. Certain of the partners and employees of Coopers and Lybrand, the auditors of Prima Bank Holdings Ltd. (one of the companies in liquidation) were granted leave to intervene as amici curiae in terms of Constitutional Court rule 9 and to present viva voce argument as well. Written memoranda were invited and accepted from the Association of Law Societies, the Public Accountants' and Auditors' Board, the South African Institute of Chartered Accountants and the Association of Insolvency Practitioners of Southern Africa. We are at the beginning stages of utilising the amicus curiae intervention procedures for which provision is made in Constitutional Court rule 9. We wish to acknowledge the valuable assistance derived by this Court from the argument on behalf of the amici curiae, JSN Fourie and others, as well as from the memoranda filed by the above mentioned professional bodies.

 

 

[5]                All parties were in agreement (expressly or tacitly) that the matter in paragraph 1 of the order of referral had been properly referred to this Court by Van Schalkwyk J in terms of the provisions of section 102(1) of the Constitution. The correctness of this agreement (or assumption) was not questioned at the hearing of the matter before us. On reflection, the assumption appears to be wrong in law and the correctness of it, inasmuch as it involves a matter of law (constitutional law in fact), must be considered by this Court. In so doing it is necessary to say something about the meaning and use of section 102(1) in general.

 

[6]                For present purposes the relevant part of section 102(1) provides that -

"If, in any matter before a provincial or local division of the Supreme Court, there is an issue which may be decisive for the case, and which falls within the exclusive jurisdiction of the Constitutional Court in terms of section 98(2) and (3), the provincial or local division concerned shall, if it considers it to be in the interest of justice to do so, refer such matter to the Constitutional Court for its decision: .................................................................................................................".

 

Section 102(1) does not confer a general discretion on the Court in question to refer matters to the Constitutional Court. The referral is mandatory ("the provincial or local division concerned shall ... refer") and the power and duty to refer only arises when the following three conditions are fulfilled:

(a)       there is an issue in the matter before the Court in question which may be decisive for the case;

 

(b)       such issue falls within the exclusive jurisdiction of the Constitutional Court;

and,

(c)        the Court in question considers it to be in the interests of justice to refer such issue to the Constitutional Court.

(I use the word "issue" in paragraph (c) above instead of the word "matter", which appears in the text of section 102(1), because this is the construction which Didcott J, writing for the Court in S v. Vermaas; S v. du Plessis[1] gave to the word "matter" where it appears for the second time in section 102(1)).

 

These conditions are conjunctive and all have to be fulfilled before the Court has the power to refer an issue to the Constitutional Court in terms of section 102(1). It is true that the fulfilment of conditions (a) and (c) depends upon the Court in question reaching particular conclusions on the basis of the criteria there stated, but these conclusions have to be reached (and condition (b) must exist) before the Court is empowered and obliged to refer the issue.

 

 

[7]                Section 103(4) of the Constitution deals inter alia with the referral by a Provincial or Local division of the Supreme Court to this Court of issues originating in Courts other than Provincial or Local divisions of the Supreme Court and, in particular, with the referral to this Court of an issue regarding the validity of a law falling within the exclusive jurisdiction of this Court. In addition to stipulating other conditions precedent for such referral, the sub-section requires the Povincial or Local Division of the Supreme Court to be of the opinion "that there is a reasonable prospect that the relevant law or provision will be held to be invalid." Although there is no such express requirement in section 102(1), Kentridge AJ, in Mhlungu and Others v. The State[2], held that "it was implicit therein".[3] He further explained that

"[t]he reasonable prospect of success is, of course, to be understood as a sine qua non of a referral, not as in itself sufficient ground. It is not always in the interests of justice to make a reference as soon as the relevant issue has been raised".[4]

 

 

(It is clear from the context of the above passage, that Kentridge AJ was dealing only with condition (c) of my above analysis.) He explained why it was not always in the interests of justice to make a referral immediately (an exposition which I need not repeat here) and laid down "as a general principle" that "where it is possible to decide any case, civil or criminal, without reaching a constitutional issue, that is the course which should be followed".[5] Although the Court was divided in Mhlungu as to the construction and application of section 241(8), there was unanimous agreement with Kentridge AJ's construction and application of section 102(1).

 

 

[8]                I round off this general discussion of section 102(1) by pointing out that Constitutional Court rule 22(2) obliges the judge or judges referring an issue in terms of section 102(1) to

"formulate in writing .... the reason why he or she or they consider it to be in the interest of justice that the matter be referred."

 

On the construction which this Court in Mhlungu placed on the third pre-condition for referral (i.e. that it must be in the interest of justice to do so), it therefore follows that the judge or judges referring to the Constitutional Court the issue of the constitutionality of an Act of Parliament are obliged to furnish written reasons why it is considered that

(a)       there is a reasonable prospect that the Act of Parliament in question will be held to be invalid; and

(b)       the interest of justice requires this issue to be referred at this particular stage.

(I hasten to add that when Van Schalkwyk J referred the matter to this Court the judgment in Mhlungu had not been delivered and rule 22(2) had not been promulgated).

 

 

[9]                These principles have to be applied to the referral in the present case. The only matters before Van Schalkwyk J were the applications for interim interdicts against the relevant respondents to prohibit further interrogation of the applicants. In dismissing both applications for interdicts Van Schalkwyk J in fact disposed of all (and the only) matters properly before him. At this stage the issue of the validity of section 417(2)(b) had become irrelevant. He had decided, on the view he took of the law, that the issue of the validity of section 417(2)(b) was not relevant to the matter before him. He could not, on his view of the law, even consider the validity issue as part of the interdict enquiry. In adopting this approach he in fact decided (albeit implicitly) that the matter before him could and should be decided without reference to the validity issue, in other words, that the validity issue could not be decisive for the case. The implication of this is that the first condition for a section 102(1) referral, mentioned in paragraph [6](a) above, has not been fulfilled. Accordingly the learned judge was precluded from referring the constitutional validity of section 417(2)(b) of the Act to this Court. He in fact precluded the operation of section 102(1) by deciding the "case" or the "matter" before him.

 

 

[10]           The possibility that the referral of the paragraph (1) issue might be incompetent was not alluded to during argument nor raised by the Court with counsel. When, however, the question of the competence of the referrals of the issues in paragraphs (2) - (5) of the referral order was raised with Mr. Levine, he requested the Court to grant the applicants direct access on these issues in terms of section 100(2) of the Constitution. I have no doubt that, if the incompetence of the referral of the paragraph (1) issue had been raised with him, Mr. Levine would likewise have urged the Court to grant direct access on this issue as well. The matter has been fully argued before us and all the parties are clamant for a decision from the Court. We were informed that many section 417 enquiries were being held up because the issue of the constitutionality of section 417(2)(b) had been raised in such enquiries. This is substantially hampering the proper liquidation of companies and is therefore a matter of such urgency and public importance that a ruling should be given thereon. Under the exceptional circumstances of this case it would be surrendering to the merest formalism if we did not deal with the paragraph (1) issue as one which was before us by way of direct access in terms of section 100(2) of the Constitution. It should therefore be treated as such. The interested parties are amenable to the issue being dealt with on this basis.  

 

[11]           It was contended on behalf of the respondents that the referral to this Court of the issues in paragraphs (2) - (5) of the referral order were not competent in terms of section 102(1) of the Constitution because none of these issues falls within the exclusive jurisdiction of the Constitutional Court and, consequently, a condition precedent to referral has not been fulfilled.

 

 

[12]           It is not immediately apparent whether the issue referred in paragraph (2) of the referral order is premised on the finding that section 417(2)(b) of the Companies Act is inconsistent with the Constitution by this Court or premised on the finding that it is consistent. On either premise it is difficult to see how it can be contended that this issue was properly referred. The only issue before van Schalkwyk J was the interdict sought by the applicants "to prohibit their further interrogation pending the determination of the constitutionality of section 417(2)(b) of the Companies Act, by the Constitutional Court."[6] The matter detailed in paragraph (2) of the referral order, namely the admissibility of testimony given pursuant to the provision of section 417(2)(b) of the Act in subsequent criminal proceedings, was simply not an issue before Van Schalkwyk J. The wording of section 102(1) of the Constitution is perfectly clear. The only issue which can be referred to the Constitutional Court is one "in any matter before a provincial or local division of the Supreme Court." Van Schalkwyk J did not therefore have the power to refer the paragraph (2) issue to this Court.

 

[13]           Even if the question of admissibility had been an issue before Van Schalkwyk J, for example by way of an application for a declaratory order, it ought not to have been be referred to us, because it does not fall within our exclusive jurisdiction. Although section 101(3) nowhere expressly confers power on the Provincial or Local Divisions of the Supreme Court to construe the Constitution, this is an implied power, as found by Kentridge AJ in S v. Mhlungu and Four Others.[7] These Courts are obliged to decide constitutional questions within their jurisdiction, together with discharging their customary duties of construing statutes and applying them, as well as the common law, under the ever present influence of the Constitution. These are the Courts which must, in the first instance, construe the Constitution and statutory law, even (or perhaps especially) when portions of a statute have been declared to be invalid. In this context the following remarks of Kentridge AJ, in S v. Zuma and Others bear repeating:

"The jurisdiction conferred on judges of the Provincial and Local Divisions of the Supreme Court under section 101(3) is not an optional jurisdiction. The jurisdiction was conferred in order to be exercised."[8]

 

 

[14]           The issue in paragraph (2) relates exclusively to the admissibility of evidence in subsequent criminal proceedings against persons who have testified pursuant to the provisions of section 417 and given evidence which tends to incriminate them. The question of the admissibility of evidence is, in the first instance, a matter for the Court dealing with the criminal proceedings in question. Should evidence be admitted incorrectly, and this raises a constitutional issue, the Constitutional Court may ultimately be called upon to decide the issue, but not before; unless the issue is one falling within its exclusive constitutional jurisdiction.

 

 

[15]           We were pressed in argument to deal with such other issues because they are ancillary to the issue of the invalidity of section 417(2)(b) of the Act. Neither the context, wording nor purpose of the sections in the Constitution dealing with this Court's jurisdiction gives this Court jurisdiction to deal with matters of evidential admissibility on the basis that they are ancillary to a section 98(5) declaration of invalidity. It was certainly not the purpose of the institution of the Constitutional Court, or the framing of its jurisdiction, to require it to give an advisory opinion (for this is in essence what the applicants seek) as to the admissibility of evidence in some future criminal proceedings which might be brought against the applicants. The admissibility of evidence is traditionally, and for very good reasons, a matter which the trial Court must in the first instance always decide. There is no contextual or teleological indication that the framers of the Constitution wished to depart from this fundamental and self-evident rule. We are not here dealing with a case where a criminal trial Court (on a proper application of section 102(1) of the Constitution as explained above[9]) has referred to us an issue regarding the validity of a provision in an Act of Parliament which directly or indirectly bears on the admissibility of evidence. I accordingly conclude that the matter set forth in paragraph (2) of the referral order was incorrectly referred to this Court.

 

[16]           The matters referred to in paragraph 3 of the referral order relate to the construction of section 417 of the Act and the conduct of proceedings pursuant to it. These were not, for the reasons previously mentioned, issues before van Schalkwyk, J. If examinees feel aggrieved by the way a section 417 enquiry is being conducted, they have their ordinary remedies (including review remedies) in the Supreme Court.[10] Had these issues been properly before van Schalkwyk J he would have had the jurisdiction to deal with them. They do not fall within the exclusive jurisdiction of the Constitutional Court. I conclude that these issues were also incorrectly referred.

 

[17]           The issue in paragraph (4) of the referral order is formulated as follows:

"Whether a person is required to give testimony at an enquiry in terms of section 417 which testimony may tend or have the effect of supporting a civil claim against such person."

 

 

This issue does not raise the constitutional validity of section 417(2)(b) or any other statutory provision. In essence it seeks a ruling from this Court as to whether the examinee has a privilege to refuse to answer a question which might tend to support or have the effect of supporting a civil claim against such person. This was not an issue before van Schalkwyk J and could not therefore have been referred to this Court. If it had been an issue, it would have been one within his jurisdiction and with which he was competent to deal. For both these reasons, it ought not to have been referred to this Court.

 

[18]           The issue referred in terms of paragraph 5 of the referral order relates to the admissibility in subsequent civil proceedings of testimony given pursuant to the provisions of section 417 of the Act. For the reasons set forth, above this too is an issue which could not competently be referred to this Court.

 

[19]           The applicants, in their written argument handed in at the hearing (as distinct from their heads of argument lodged pursuant to Constitutional Court rule 19), sought to counter the problems relating to the competence of paragraph 3 of the referral order by submitting that:

"The proper exercise of this court's jurisdiction under section 98(5) would ... be to declare under such section as follows: .............

 

Section 417(2) of the Companies Act is declared to be inconsistent with the Constitution of the Republic of South Africa Act, no. 200 of 1993, to the extent that it provides that a person summoned to give evidence under section 417(1) of the Companies Act is not entitled, as of right, to prior access to -

 

(a)       all documents in the possession of the liquidator for an examination or inquiry under section 417 or 418 of the Companies Act, in so far as it relates to such person and the reason or purpose of requiring him to give evidence at, and to produce any books or papers in his custody or under his control relating to the company under winding-up;

 

 

(b)       A copy of the record of the examination of all other persons examined at the enquiry, in so far as it relates to such person and the reason or purpose of requiring him to give evidence at, and to produce any books or papers in his custody or under his control relating to the company under winding-up."[11]

 

This contention cannot prevail. The invalidity of section 417 of the Act on this ground was not an issue before Van Schalkwyk J and was not referred to this Court in the order of referral. In any event, section 417(2) simply does not contain the provision imputed to it in the above quoted passage. What applicants are seeking to obtain from this Court, under the guise of an attack on the validity of section 417(2), is a declaration of rights concerning the proper conduct of a section 417 hearing. This they cannot expect to achieve and will not be permitted to achieve under a referral pursuant to section 102(1) of the Constitution, because it was not an issue before Van Schalkwyk J and is not an issue within the exclusive jurisdiction of the Constitutional Court.

 

The Constitutional validity of section 417(2)(b) of the Companies Act

[20]           The way is now open to consider the only issue properly before this Court, namely, the constitutional validity of section 417(2)(b) of the Companies Act. The grounds of constitutional inconsistency were formulated as follows in the referral order:

".... it compels a person summoned to an enquiry to testify and produce documents even though such person seeks to invoke the privilege against self-incrimination."

 

 

Section 417(2)(b) does not compel the production of documents; section 417(3) does. The constitutionality of section 417(3) was not referred to this Court and no amendment of the referral order was sought to incorporate an attack on section 417(3). This ground for the invalidation of section 417(2)(b) is unfounded. Appreciating this difficulty, the applicants limited their attack to seeking an invalidation of section 417(2)(b)

".... to the extent that it requires a person examined under section 417(2) of the Act to answer questions which might tend to incriminate him and provides that any answers given to any such question may thereafter be used in evidence against him."

 

The issue properly before this Court is therefore a relatively narrow one. In the case of Bernstein and Others v. L.V.W. Bester NO and Others, CCT 23/95, heard subsequent to this case on 19 September 1995, a broader attack was launched against sections 417 and 418 of the Companies Act. Nothing contained in the present judgment is to be interpreted as a prejudgment in any way of this broader attack.

 

The attack based on section 25(3) of the Constitution

 

[21]           The main attack which Mr. Levine, on behalf of the applicants, launched on the constitutionality of section 417(2)(b) of the Act was that its provisions were inconsistent with an accused's rights "to a fair trial" as provided in section 25(3) of the Constitution. For the sake of brevity these rights will be referred to as "the section 25(3) rights" or "an accused's section 25(3) rights." It was submitted that the right against self-incrimination is not limited to detained, arrested or accused persons (which are the classes of persons to which the section 25 rights apply) but that "the right against self-incrimination is a right recognised under the Constitution in extra-curial proceedings including proceedings at an enquiry constituted in terms of section 417 of the Companies Act."

 

[22]           Mr. Levine submitted that, properly construed, the issue before this Court relating to the constitutionality of section 417(2)(b) of the Companies Act, was whether:

(a)       the statutory duty to give answers which might tend to incriminate the person examined; and

(b)       the statutory provision that such answers may thereafter be used in evidence against the examinee,

limit any right entrenched in Chapter 3 of the Constitution. Mr. Cilliers, on behalf of second respondents in the Ferreira referral, submitted that the attack based on section 25 of the Constitution was, on the clear and unambiguous wording of the Constitution, fundamentally flawed. As to (a), Mr. Cilliers submitted that there was no general right against self-incrimination expressly enumerated in Chapter 3. Mr. Cilliers rightly conceded that some protection against self-incrimination was extended by section 25(2) of the Constitution to "[e]very person arrested for the alleged commission of an offence" and in terms of section 25(3)(c) and (d) to "[e]very accused person" as part of such person's right to a fair trial. However, the rights enumerated in section 25(2)(a) to (d) only apply to arrested persons and the rights enumerated in section 25(3)(c) and (d) only to an accused person while such person is on trial.

 

[23]           As to (b), Mr. Cilliers submitted that "the right to a fair trial" enacted in section 25(3) would, unless the context otherwise indicates, require self-incriminating evidence, involuntarily given, to be excluded in the criminal trial of an accused. That is the rule of our common law. In R v. Camana,[12] Innes CJ observed as follows:

"Now, it is an established principle of our law that no one can be compelled to give evidence incriminating himself. He cannot be forced to do that either before the trial, or during the trial."[13]

 

 

Mr. Cilliers also submitted that, unless the context of section 25(3) otherwise indicated, the provisions of section 417(2)(b) of the Act, which enable the State to use self-incriminating evidence obtained under the legal compulsion of the latter section during a criminal trial, limit the accused's section 25(3) right to a fair trial. On this approach it is no answer to contend that, at the time of the examination under section 417 of the Act, the examinee is not yet an accused person. The concluding words of section 417(2)(b) of the Act "and any answer given to such question may thereafter be used in evidence against him" do refer to and find application, inter alia, during a subsequent criminal trial. On the other hand, the mere statutory obligation to answer self-incriminating questions in extra-curial proceedings is not inconsistent with the "right to a fair trial" (for the examinee is not an accused and therefore not entitled to invoke the section 25(3) rights); only the subsequent use of such answers at any criminal trial against the examinee would fall within the purview of section 25(3). The applicants are not accused nor is there any suggestion that they will be accused. Accordingly they cannot, at the time of their examination under section 417(2)(b) of the Act, rely on the section 25(3) rights.

 

 

[24]           The correctness of this attack by Mr. Cilliers on the applicants' argument from section 25(3) of the Constitution needs to be considered first, before dealing with his other submissions. It seems to me that the only line of reasoning which might counter Mr. Cilliers' objection would be along the following lines. There is authority in Australia and Canada for the proposition that the common law privilege against extra-curial self-incrimination is a substantive right and not merely a rule of evidence;[14] that, without being able to invoke such a right at trial, an accused cannot obtain a fair trial, and therefore reliance upon such right must be regarded as an unenumerated section 25(3) right.[15] When the examinee at a section 417 of the Act enquiry is asked a question which might tend to incriminate the examinee, he or she objects and raises the common law right against self-incrimination. In so doing, the examinee is not invoking a section 25(3) right, but a substantive common law right. The examiner counters this objection by pointing to the repeal of this common law right, in the context of section 417 enquiries, by section 417(2)(b) of the Act. The rejoinder of the examinee is that such purported repeal is invalid on the grounds that section 417(2)(b) is unconstitutional by virtue of the fact that it is inconsistent with the section 25(3) rights of an accused. The objection that the examinee is not an accused in a criminal trial, and cannot therefore rely on a section 25(3) right which only accrues to an accused, is met by appealing to section 4(1) and 7(4)(b) of the Constitution. Section 4(1) provides in part that -

"This Constitution shall be the supreme law of the Republic and any law inconsistent with [the Constitution's] provisions shall, unless otherwise provided expressly or by necessary implication in this Constitution, be of no force and effect to the extent of this inconsistency."         

 

This provision came into operation on 27 April 1994. Section 7(4)(b) provides, inter alia, that the relief referred to in section 7(4)(a) (which includes a declaration of rights) may be sought by -

"(i)       a person acting in his or her own interest;

 (ii)       ...........

 (iii)      ...........

 (iv)      ...........

 (v)       a person acting in the public interest."

 

[25]           There are four parts to the above line of reasoning. The first relates to the question whether the invalidity (being of "no force and effect") of a statute (as a species of "law") is determined by an objective or a subjective enquiry. The second relates to the question of the time at which such invalidity occurs. The third relates to the circumstances under which an appeal to invalidity may be made (the question of justiciability) and the fourth to the question as to who may invoke the invalidity (locus standi in the narrower sense).

 

 

[26]           The answer to the first question is that the enquiry is an objective one. A statute is either valid or “of no force and effect to the extent of its inconsistency”. The subjective positions in which parties to a dispute may find themselves cannot have a bearing on the status of the provisions of a statute under attack.  The Constitutional Court, or any other competent Court for that matter, ought not to restrict its enquiry to the position of one of the parties to a dispute in order to determine the validity of a law. The consequence of such a (subjective) approach would be to recognise the validity of a statute in respect of one litigant, only to deny it to another. Besides resulting in a denial of equal protection of the law, considerations of  legal certainty, being a central consideration in  a constitutional state, militate against the adoption of the subjective approach. This also follows from the wording of section 4(1). The words "shall be" do not refer to a date beyond 27th April 1994. On 27 April 1994, and subject to the qualification in the text of section 4(1) ("unless otherwise provided expressly or by necessary implication in this Constitution"), a law which is inconsistent with the Constitution ceases to have legal effect. For this reason, it was necessary to enact a provision such as section 98(6)(a) of the Constitution which provides that, unless the Constitutional Court otherwise orders -

 

"... the declaration of invalidity of a law or a provision thereof -

(a)       Existing at the commencement of this Constitution, shall not invalidate anything done or permitted in terms thereof before the coming into effect of such declaration of invalidity;"

 

 

[27]           The Court's order does not invalidate the law; it merely declares it to be invalid. It is very seldom patent, and in most cases is disputed, that pre-constitutional laws are inconsistent with the provisions of the Constitution. It is one of this Court's functions to determine and pronounce on the invalidity of laws, including Acts of Parliament. This does not detract from the reality that pre-existing laws either remained valid or became invalid upon the provisions of the Constitution coming into operation. In this sense laws are objectively valid or invalid depending on whether they are or are not inconsistent with the Constitution. The fact that a dispute concerning inconsistency may only be decided years afterwards, does not affect the objective nature of the invalidity. The issue of whether a law is invalid or not does not in theory therefore depend on whether, at the moment when the issue is being considered, a particular person's rights are threatened or infringed by the offending law or not.

 

[28]           A pre-existing law which was inconsistent with the provisions of the Constitution became invalid the moment the relevant provisions of the Constitution came into effect. The fact that this Court has the power in terms of section 98(5) of the Constitution to postpone the operation of invalidity and, in terms of section 98(6), to regulate the consequences of the invalidity, does not detract from the conclusion that the test for invalidity is an objective one and that the inception of invalidity of a pre-existing law occurs when the relevant provision of the Constitution came into operation. The provisions of sections 98(5) and (6), which permit the Court to control the result of a declaration of invalidity, may give temporary validity to the law and require it to be obeyed and persons who ignore statutes that are inconsistent with the Constitution may not always be able to do so with impunity.

 

 

[29]           There is also Canadian authority for such an objective approach.[16] Peter Hogg describes the position in that country as follows:           

"This practice of ‘prospective overruling' is difficult to justify in theory, however attractive it may be in practice, and it has never been accepted by Canadian Courts. For a Canadian Court, a constitutional restriction operates of its own force, even if judicial recognition of the fact has been delayed. Once the Supreme Court of Canada has held that a law is unconstitutional, there can be no doubt about the status of the law: it is invalid, and need not be obeyed.”[17] (Emphasis added)

 

The German Federal Constitutional Court follows a similar approach. Klaus Schlaich puts it as  follows:

"Das verfassungswidrige Gesetz ist, wie das BverfG formuliert, 'mit dem Grundgesetz unvereinbar und daher nichtig'. Das verfassungswidrige Gesetz ist von Anfang an (ex tunc) und dies ohne weiteren gestaltenden Akt (ipso iure) unwirksam....Nach deutscher Auffassung hebt das BverfG verfassungswidrige Gesetze nicht auf, es vernichtet sie nicht: Es stellt die Nichtigkeit nur (deklaratorisch) fest....” (An unconstitutional law is, as the Federal Constitutional Court puts it, 'inconsistent with the Basic Law and therefore invalid'. An unconstitutional law is from its inception (ex tunc) and without need for any further constitutive act (ipso iure) inoperative... The German view is that the Federal Constitutional Court does not annul a statute, [the Court] does not invalidate: it merely establishes the invalidity (in a declaratory way)).[18]

 

 

[30]           The second question has really been resolved in the course of answering the first. The pre-constitutional law becomes invalid when the relevant provision of the Constitution came into operation (i.e. 27 April 1994), notwithstanding the fact that this Court declares it to be invalid at a later date and has, in terms of section 98(5) and 98(6) of the Constitution, the power to postpone and regulate the operation of invalidity.

 

[31]           For the sake of convenience, the fourth question (locus standi in the narrower sense) will be addressed next. The question in the present case is whether the applicants, as examinees, are acting in their own interest. Few, if any, countries have at all times allowed all persons to invoke the jurisdiction of Courts to solve all legal problems. Some restrictions have always been placed on the locus standi of a complainant. Section 7(4)(b) of the Constitution determines which persons are entitled to apply to a competent Court of law for appropriate relief. They are:

"(i)       a person acting in his or her own interest;

 (ii)       an association acting in the interest of its members;

 (iii)      a person acting on behalf of another person who is not in a position to seek such relief in his or her own name;

 (iv)      a person acting as a member of or in the interest of a group or class of persons; or

 (v)       a person acting in the public interest."

 

 

[32]           When an examinee at a section 417 enquiry attacks the validity of section 417(2)(b) on the grounds that it conflicts with the implied residual rights of an accused in terms of section 25(3) of the Constitution, the examinee's contention (properly understood) is not that the examinee is entitled, as an accused, to invoke the implied right against extra-judicial self-incrimination in section 25(3) of the Constitution, but rather that section 417(2)(b) of the Companies Act is, as an abstract and objective proposition, inconsistent with the aforementioned constitutional right and the examinee is entitled to a ruling thereon. The real question which must therefore be posed is whether an examinee who has previously been compelled under section 417(2)(b) to give answers which incriminate him or her may, at a subsequent criminal trial of the examinee, successfully attack the introduction of such incriminating answers on the basis that section 417(2)(b) conflicts with the unenumerated right against self-incrimination in section 25(3). If the answer is in the affirmative, the only remaining question is whether the examinee may raise the issue of the unconstitutionality of section 417(2)(b) of the Act at the stage when a question, the answer to which might tend to incriminate him or her, is put to the examinee in the section 417 examination.

 

[33]           In terms of section 418(5)(b)(iii) of the Companies Act, any person who has been duly summoned under section 417(1) of the Companies Act and who

"fails, without sufficient cause - ... to answer fully and satisfactorily any question lawfully put to him in terms of section 417(2) ..."

 

 

 

is guilty of an offence and, in terms of section 441(1)(f), liable upon conviction to a fine not exceeding R2000 or to imprisonment for a period not exceeding six months or to both such fine and such imprisonment. The witness is surely entitled to know whether a question, the answer to which might tend to incriminate him or her, is a "question lawfully put" and whether the witness has "sufficient cause" to refuse to answer it. This is dependant on whether section 417(2)(b) is constitutionally valid. If it is not, the witness can with equanimity refuse to answer. If it is valid, the choice arises between refusing to answer and being punished, possibly with a prison sentence, or answering and possibly prejudicing the witness's defence in a subsequent criminal trial. This dilemma, with the possible adverse consequences on either choice the witness makes, gives the witness sufficient interest of "his or her own" to entitle the witness "to apply to a competent court of law for appropriate relief, which may include a declaration of rights" in terms of section 7(4)(a) of the Constitution.

 

[34]           It seems to me, however, that the suggested line of reasoning fails to meet the third requirement, namely that of justiciability. Section 7(4)(a) of the Constitution is introduced by the phrase -

"When an infringement of or threat to any right entrenched in this Chapter [Chapter 3] is alleged ..."

 

It is only when this condition is fulfilled that the persons referred to in paragraph (b) "shall be entitled to apply to a competent court of law for appropriate relief." The crucial question is whether, when an examinee is compelled by section 417(2)(b) to answer a question which might tend to incriminate him or her and the section further provides that "any answer given to such question may thereafter be used in evidence against him", a section 25(3) right to a fair criminal trial is being infringed or threatened with infringement.

 

 

[35]           Textually, the relevant wording of section 7(4)(a) is clear. It is only when a Chapter 3 right is actually infringed or threatened with infringement that the prescribed persons are entitled to seek relief from a competent Court of law. The purpose seems clear. However widely the framers extended locus standi in section 7(4)(b), they did not wish abstract questions of constitutionality to be pursued in the Courts; the only exceptions being those specifically enacted in the Constitution, such as sections 98(2)(d) and 101(3)(e) of the Constitution, which, respectively, confer jurisdiction on the Constitutional Court over any dispute over the constitutionality of any Bill before Parliament or a provincial legislature and, in the case of a Provincial or Local Division of the Supreme Court, over any dispute as to the constitutionality of a Bill before a provincial legislature.

 

[36]           The locus standi of all persons referred to in subparagraphs (i) - (v) of subsection (4)(b) is governed by the introductory phrase:   

                                    “ (b) The relief referred to in paragraph (a) may be sought by - ...”.

 

In my view the whole of subsection (4)(b) of section 7 must be read as being subject to the qualification in subsection (4)(a).  Subsection 4(a) expressly renders the right “to apply to a competent court” conditional upon “when an infringement of or threat to any right entrenched in this Chapter is alleged.” The purpose of the introductory phrase in subsection (4)(b), “[t]he relief referred to in paragraph (a) may be sought by”, is to indicate by whom such relief may be sought. It neither textually, contextually nor teleologically alters the condition stipulated in subsection (4)(a); in particular it does not in any way affect the impact of the words “when an infringement of or threat to any rights entrenched in this Chapter is alleged”.

 

[37]           Against this background, the provisions of subparagraph (4)(b)(iii) become clear and lend further weight to the above construction. This subparagraph refers to “a person acting on behalf of another person who is not in a position to seek such relief in his or her own name.” The words “such relief” can only refer to the “relief referred to in paragraph (a)” mentioned in the introductory words of paragraph (b), i.e. the relief which may be sought “when an infringement of or threat to any right entrenched in this Chapter is alleged." Subparagraph (4)(b)(iii) means that when it is alleged that a Chapter 3 right of A has been infringed or threatened and A is not in a position to seek relief, B may do so on behalf of A.

 

[38]           Under these circumstances the provisions of subparagraph (4)(b)(i), namely -

                        “The relief referred to in paragraph (a) may be sought by -

                                      (i) a person acting in his or her own interest”

 

can only mean that there must be an “infringement of or threat to” a Chapter 3 right of the “person acting in his or her own interest”, for the “relief referred to in paragraph (a)” only becomes available when there is “an infringement of or threat to” a Chapter 3 right.  In terms of subparagraph (4)(b)(iii) B acts for A when A’s Chapter 3 right is infringed or threatened with infringement and A is not in a position to seek such relief in his or her own name. In terms of subparagraph (4)(b)(i) A acts for himself or herself when A’s Chapter 3 right is infringed or threatened with infringement and A is in a position to seek such relief in his or her own name. Paragraph (4)(a) determines when the right to invoke the aid of a Court arises; subsection (4)(b) determines by whom that right (when it accrues) may be exercised. The locus standi of all categories of persons in paragraph (4)(b) is qualified by paragraph (4)(a).

 

[39]           It was not suggested that such limitation of justiciability was contrary to the values mentioned in section 35(1). The contrary was not argued. Neither was it suggested that such limitation of justiciability was contrary to the values mentioned in section 35(1), namely, "the values which underlie an open and democratic society based on freedom and equality"; nor that public international law or foreign law would lead one to a different answer. The jurisdictions of the United States of America,[19] Canada[20] and Germany[21] all have "case and controversy" and locus standi provisions which limit justiciability. There being no other justification for not doing so, the aforementioned words in section 7(4)(a) must therefore be given their plain, ordinary, grammatical meaning.[22]

 

 

[40]           To my mind the inescapable construction of subsection 7(4) leads to the conclusion that, if section 25(3) of the Constitution is to be relied upon, there must be an “infringement of or threat to” a section 25(3) right, whether the right accrues to the person seeking the relief (subparagraph (4)(b)(i)), or a person on whose behalf someone else seeks relief (subparagraph (4)(b)(iii)) or for whom a person acts in the public interest (subparagraph (4)(b)(v)). This all follows from the express qualification in paragraph (4)(a) which is incorporated by reference in paragraph (4)(b) in the manner referred to above.

 

[41]           The section 25(3) rights accrue, textually, only to "every accused person". They are rights which accrue, in the subjective sense, when a person becomes an "accused person" in a criminal prosecution. The examinee is not such an "accused person". It is a matter of pure speculation whether the applicants will ever become accused persons. Even should they become accused persons, their rights against extra-curial self-incrimination (assuming for the moment that such a right is an implied right in the larger category "right to a fair trial") are not automatically infringed when they become accused persons. It will depend upon whether self-incriminating evidence given by the applicants at the section 417 enquiry is tendered in evidence against them. At that moment, for the first time, there is a threat to any section 25(3) right against extra-curial self-incrimination. The inescapable conclusion, therefore, is that section 417(2)(b) does not constitute an infringement or threat of infringement of any section 25(3) rights of the applicants and that their attack on section 417(2)(b) on this basis can accordingly not succeed. This was in fact the prima facie conclusion reached in Lynn NO and Another v. Kreuger and Others.[23]

 

 

[42]           In the alternative, the applicants, for their constitutional challenge to section 417(2)(b) of the Act, relied with differing degrees of enthusiasm and persistence on the rights protected in sections 8, 10, 11, 13, 15, 22 and 24 of the Constitution. The main alternative argument was, however, based on the rights to "freedom and security of the person" and "personal privacy", respectively entrenched in sections 11(1) and 13.

 

[43]           Section 7(4)(a) of the Constitution does not present any difficulty to the applicants in so far as they seek to rely on such rights, since these rights are not limited to any category of persons nor restricted to any particular factual context. Such reliance does not raise mere "academic" questions of law, but ones which become justiciable the moment the applicants invoke these rights.

 

 

[44]           The task of determining whether the provisions of section 417(2)(b) of the Act are invalid because they are inconsistent with the guaranteed rights here under discussion involves two stages[24] first, an enquiry as to whether there has been an infringement of the section 11(1) or 13 guaranteed right; if so, a further enquiry as to whether such infringement is justified under section 33(1), the limitation clause. The task of interpreting the Chapter 3 fundamental rights rests, of course, with the Courts, but it is for the applicants to prove the facts upon which they rely for their claim of infringement of the particular right in question. Concerning the second stage, "[it] is for the legislature, or the party relying on the legislation, to establish this justification (in terms of section 33(1) of the Constitution), and not for the party challenging it, to show that it was not justified."[25]

 

The infringement of the section 11(1) right to freedom and security of the person

[45]           In order to determine, at the first stage of the enquiry, whether the provisions of section 417(2)(b) of the Act are inconsistent with the section 11(1) right to freedom and security of the person, it is necessary, as a matter of construction, to define or circumscribe the section 11(1) right to the extent necessary for purposes of this decision. It is obviously unwise and undesirable (if not impossible) even to attempt an exhaustive or comprehensive definition or circumscription of the right designed to hold good indefinitely and for all further cases. Yet, even if the exact nature and boundaries of the right are to be defined on a case to case basis, some attempt must be made at this stage to determine the meaning, nature and extent of the right. As part of this enquiry it is also necessary to determine more precisely what it is about the nature and operation of the provisions of section 417(2)(b) of the Act, and their impact upon the examinee, which can be said to be inconsistent with the right to freedom.

 

[46]           This Court has given its approval to an interpretive approach

 

"which, whilst paying due regard to the language that has been used, is 'generous' and 'purposive' and gives expression to the underlying values of the Constitution"[26]

 

 

as well as to that expressed in the following passage in the Canadian case of R v. Big M Drug Mart Ltd.:

"The meaning of a right or freedom guaranteed by the Charter was to be ascertained by an analysis of the purpose of such a guarantee; it was to be understood, in other words, in the light of the interests it was meant to protect.

 

In my view this analysis is to be undertaken, and the purpose of the right or freedom in question is to be sought by reference to the character and larger objects of the Charter itself, to the language chosen to articulate the specific right or freedom, to the historical origins of the concepts enshrined, and where applicable, to the meaning and purpose of the other specific rights and freedoms with which it is associated within the text of the Charter. The interpretation should be ... a generous rather than legalistic one, aimed at fulfilling the purpose of the guarantee and securing for individuals the full benefit of the Charter's protection."[27]

 

In the words of Chaskalson P, the provisions of Chapter 3

"must not be construed in isolation, but in its context, which includes the history and background to the adoption of the Constitution, other provisions of the Constitution itself and, in particular, the provisions of Chapter 3 of which it is part. It must also be construed in a way which secures for 'individuals the full measure' of its protection."[28]

I would, in the first place, read "freedom" disjunctively from "security of the person" in section 11(1). The legislative history of the section would seem to confirm this. It was only in the Sixth Report of the Technical Committee on Fundamental Rights During the Transition that the right to "personal liberty" was combined with the right to "security of the person".[29] The right "to freedom" must be construed as a separate and independent right, albeit related to the right to "security of the person."

 

[47]           Conceptually, individual freedom is a core right in the panoply of human rights. The right to human dignity ("menswaardigheid") is specifically entrenched in section 10 and has been categorised by this Court, together with the right to life, as

"the most important of all human rights ... ."[30]

 

[48]           In Makwanyane O'Regan J pointed out that "without dignity, human life is substantially diminished"[31] and pronounced the prime value of dignity in the following terms:

"The importance of dignity as a founding value of the new Constitution cannot be overemphasised. Recognising a right to dignity is an acknowledgement of the intrinsic worth of human beings: human beings are entitled to be treated as worthy of respect and concern. This right therefore is the foundation of many of the other rights that are specifically entrenched in Chapter 3."[32]    

I agree with these views. O'Regan J also pointed out, rightly in my view, that

"[the] recognition and protection of human dignity is the touchstone of the new political order and is fundamental to the new Constitution."[33]

 

 

[49]           Human dignity cannot be fully valued or respected unless individuals are able to develop their humanity, their "humanness" to the full extent of its potential. Each human being is uniquely talented. Part of the dignity of every human being is the fact and awareness of this uniqueness. An individual's human dignity cannot be fully respected or valued unless the individual is permitted to develop his or her unique talents optimally. Human dignity has little value without freedom; for without freedom personal development and fulfilment are not possible. Without freedom, human dignity is little more than an abstraction. Freedom and dignity are inseparably linked. To deny people their freedom is to deny them their dignity. Although freedom is indispensable for the protection of dignity, it has an intrinsic constitutional value of its own.[34] It is likewise the foundation of many of the other rights that are specifically entrenched.[35]  Viewed from this perspective, the starting point must be that an individual's right to freedom must be defined as widely as possible, consonant with a similar breadth of freedom for others.

 

 

[50]           There are other and more specific indications in the Constitution that the right to freedom is to be extensively interpreted. Section 35(1) embodies an injunction that, generally, in interpreting the Chapter 3 provisions, a Court of law must promote the values which underlie an "open" and democratic society "based on freedom and equality". An "open society" most certainly enhances the argument that individual freedom must be generously defined. It is a society in which persons are free to develop their personalities and skills, to seek out their own ultimate fulfilment, to fulfill their own humanness and to question all received wisdom without limitations placed on them by the State. The "open society" suggests that individuals are free, individually and in association with others, to pursue broadly their own personal development and fulfilment and their own conception of the "good life".[36]

 

[51]           A teleological approach also requires that the right to freedom be construed generously and extensively. In Makwanyane O'Regan J, adopting such a teleological approach, correctly observed as follows:

"Respect for the dignity of all human beings is particularly important in South Africa. For apartheid was a denial of a common humanity. Black people were refused respect and dignity and thereby the dignity of all South Africans was diminished. The new Constitution rejects this past and affirms the equal worth of all South Africans. Thus recognition and protection of human dignity is the touchstone of the new political order and is fundamental to the new Constitution."[37]

 

 

In my view exactly the same approach needs to be adopted in the case of the right to freedom. This is not the place to enumerate or elaborate on the vast number of limitations which, in the recent past and prior to the Constitution, had been placed on personal freedom, nor on the extent or variety of such limitations.[38] No right minded person in any society which claimed to be democratic and based on freedom and equality would today even try to justify these limitations. They started at birth and continued relentlessly until death. For the purposes of illustration, the most selective outline of such restrictions must suffice. The Population Registration Act and associated legislation eliminated or severely restricted the freedom to identify one's child[39] and hospitalise[40] or educate[41] one's child. As an adult the curtailments of freedom related, amongst other things, to where one could reside[42], work[43] or own property[44]; what work one could do[45]; who one could marry[46]; how one could express[47] or organise oneself politically[48] or where one could be buried.[49] A feature common to all or many of these denials of freedom was a denial of the freedom to choose or develop one's own identity, a denial of the freedom to be fully human. One of the main objects of the Constitution is to eradicate such denial or restriction of freedom, not in a casuistic way but as a profound constitutional commitment.  In Makwanyane I had occasion to emphasise "the importance, in our new constitutional state, of reason and justification when rights are sought to be curtailed"[50] and to refer to the fact that the Constitution is, in the words of Prof E Mureinik, "... a bridge to ... a culture of justification".[51] This further supports an extensive definition of freedom at the first stage of the enquiry. It may, in the State's interest, be necessary to limit the right to freedom, but then it is for the body or person relying upon such limitation to establish in terms of section 33(1) inter alia, in the case of the limitation of a section 11(1) right, that such limitation is reasonable, justifiable in an open and democratic society based on freedom and equality, and necessary.

 

[52]           I do not think that, in the context of the Constitution as a whole, there is any difference between freedom and liberty.[52] In the negative sense freedom is, as pointed out by Isaiah Berlin,

"involved in the answer to the question 'What is the area within which the subject - a person or a group of persons - is or should be left to do or be what he is able to do or be, without interference by other persons?'"[53]

 

 

In the positive sense freedom, so contends Berlin,

"is involved in the answer to the question 'What, or who, is the source of control or interference that can determine someone to do, or be, this rather than that?'"[54]

 

 

Section 11(1) is concerned with freedom in the negative sense and that is the sense in which I shall hereafter use it. It is essential to distinguish between freedom (liberty) and the conditions of its exercise. It could be dangerous to conflate the two concepts.

"If a man is too poor or too ignorant or too feeble to make use of his legal rights, the liberty that these rights confer upon him is nothing to him, but it is not thereby annihilated. The obligation to promote education, health, justice, to raise standards of living, to provide opportunity for the growth of the arts and the sciences, to prevent reactionary political or social or legal policies or arbitrary inequalities, is not made less stringent because it is not necessarily directed to the promotion of liberty itself, but to conditions in which alone its possession is of value, or to values which may be independent of it. And still, liberty is one thing, and the conditions for it another .... . Useless freedoms should be made usable, but they are not identical with the conditions indispensable for their utility. This is not a merely pedantic distinction, for if it is ignored, the meaning and value of freedom of choice is apt to be downgraded. In their zeal to create social and economic conditions in which alone freedom is of genuine value, men tend to forget freedom itself; and if it is remembered, it is liable to be pushed aside to make room for these other values with which the reformers or revolutionaries have become pre-occupied ..... . To provide for material needs, for education, for such equality and security as, say, children have at school or laymen in a theocracy, is not to expand liberty. We live in a world characterized by régimes (both right- and left-wing) which have done, or are seeking to do, precisely this; and when they call it freedom, this can be as great a fraud as the freedom of the pauper who has a legal right to purchase luxuries. Indeed, one of the things that Dostoevsky's celebrated fable of the Grand Inquisitor in The Brothers Karamazov is designed to show is precisely that paternalism can provide the conditions of freedom, yet withhold freedom itself."[55]

 

 

The fact that the right to freedom must, in my view, be given a broad and generous interpretation at the first stage of the enquiry, must therefore not be thought to be premised on a concept of the individual as being in heroic and atomistic isolation from the rest of humanity, or the environment, for that matter. I wish to emphasise quite explicitly that a broad and generous interpretation of freedom does not deny or preclude the constitutionally valid, and indeed essential, role of state intervention in the economic as well as the civil and political spheres. On the contrary, state intervention is essential to resolve the paradox of unlimited freedom (where freedom ultimately destroys itself) in all these spheres.[56] But legitimate limitations on freedom must occur through and be justified under the principles formulated in section 33(1), not by giving a restricted definition of the right to freedom in section 11(1). Kant luminously conceptualises freedom as the "only one innate right" in the following terms:

"Freedom (independence from the constraint of another's will), insofar as it is compatible with the freedom of everyone else in accordance with a universal law, is the one sole and original right that belongs to every human being by virtue of his humanity."[57]

 

 

[53]           I also accept that it is not possible in all circumstances to fully harmonise all the Chapter 3 rights with one another and that, in a given case, one right will have to be limited in favour of another. As Berlin points out:

"... since some values may conflict intrinsically, the very notion that a pattern must in principle be discoverable in which they are all rendered harmonious is founded on a false a priori view of what the world is like. If ... the human condition is such that men cannot always avoid choices ... [this is] for one central reason ... namely, that ends collide; that one cannot have everything ... The need to choose, to sacrifice some ultimate values to others, turns out to be a permanent characteristic of the human predicament";[58]

 

 

and  further comments:

"If we wish to live in the light of reason, we must follow rules and principles; for that is what being rational is. When these rules or principles conflict in concrete cases, to be rational is to follow the course of conduct which least obstructs the general pattern of life in which we believe. ... [E]ven those who are aware of the complex texture of experience, of what is not reducible to generalisation or capable of computation, can, in the end, justify their decisions only by their coherence with some over-all pattern of a desirable form of personal or social life, of which they may become fully conscious only, it may be, when faced with the need to resolve conflicts of this kind. If this seems vague, it is so of necessity."[59]

 

 

Although Berlin's views pertain to the field of political and moral philosophy, they are in my view equally applicable, mutatis mutandis, to constitutional interpretation and adjudication, where for the touchstone of "some over-all pattern of a desirable form of personal or social life" one could substitute "some over-all pattern of the norms and values of the Constitution." Section 35(1) of our Constitution points to the norms and values "which underlie an open and democratic society based on freedom and equality." As a prerequisite for the limitation of rights entrenched in Chapter 3 of the Constitution, section 33(1)(a)(ii) provides that such limitation shall be permissible only to the extent that it is "justifiable in an open and democratic society based on freedom and equality". However, rights of freedom and equality are not always reconcilable and in concrete situations difficult choices may have to be made, because section 33(1)(a)(ii) does not provide an obvious answer to the choice between freedom and equality. Nor does section 35(1). It is, however, neither necessary nor desirable, for purposes of this case, to pursue this aspect of the matter any further.[60]

 

 

[54]           In the light of all the aforegoing I would, at this stage, define the right to freedom negatively as the right of individuals not to have "obstacles to possible choices and activities"[61] placed in their way by (for present purposes we need go no further) the State. I am indeed mindful of the fact that, as alluded to in paragraph [44] above, specific “freedom rights” are separately protected in Chapter 3. So, for example, the freedom to choose one’s place of residence is specifically protected in section 19, as is the right to enter, remain in and leave the Republic in section 20. The meaning and ambit of these specifically and separately protected freedom rights must of course, in my view, be construed in the context of their specific entrenchment with due regard to the rules of constitutional construction and, in particular, the purpose they were intended to serve. It is also important to bear in mind that, when considering possible limitations on these section 19 and 20 rights in terms of the provisions of section 33(1) of the Constitution, such limitations do not, in addition to being reasonable, also have to be “necessary” for purposes of the provisos in subparagraphs (aa) or (bb) of subsection 33(1).

 

[55]           Similarly the freedoms of expression, assembly, demonstration and petition, association, and movement, are dealt with separately and specifically in sections 15 to 18 respectively. These rights, too, have to be construed and defined separately, as indicated above. Legitimate limitations on these rights are not subject to the additional requirement of being “necessary” in terms of proviso (bb) to section 33(1) unless and insofar as any such right “relates to free and fair political activity”.

 

[56]           There are also specifically enumerated freedom rights where any limitation, in addition to being reasonable, must under all circumstances also be necessary in order to pass section 33(1) scrutiny. Such rights include the section 14(1) rights to freedom of conscience, religion, thought, belief and opinion and the section 21 political rights.

 

 

[57]           The implication of this separate enumeration and independent protection of specific freedom rights is of course that the freedom rights protected by section 11(1) should more properly be designated “residual freedom rights”. Consequently, when it is alleged that any freedom right has been infringed, the proper methodology would be first to determine whether the right infringed is a specifically enumerated freedom right. This will be done by analysis and construction of the specific section entrenching the right in question and applying it to the case at hand. If any limitation of such right is relied upon, regard will then be had to the specific provision in section 33(1) relating to such enumerated freedom right. If the alleged infringement is not of an enumerated freedom right, then the enquiry will be directed to determining whether a residual freedom right protected by section 11(1) has been infringed.  If so, any limitation of such residual freedom right must, in addition to being reasonable, also be necessary because section 11 is included in proviso (aa) to section 33(1). I have had the benefit of reading the President's judgment in draft. I fully agree with his view that the ambit of the section 11(1) freedom right "does not depend on the construction of the section in isolation but on its construction in the context of Chapter 3 of the Constitution." It is, in fact, such an approach which has led me to the conclusion that it is a residual freedom right. I also agree, and have indeed adopted this approach, that in considering a constitutional challenge based on an alleged denial or limitation of freedom the first step is to enquire whether the impugned act falls within the freedoms elsewhere protected in Chapter 3.

 

 

[58]           It might be suggested that, because the legislature has sought fit to subject any limitation of a residual freedom right to stricter scrutiny, that such residual freedom rights ought to be more narrowly construed. In my view there is no warrant for such an approach, for at least two reasons. First, it would constitute an unjustified “second-guessing” of the framers’ intention. They must have been only too well aware that at least some of the section 11(1) rights were residual freedom rights in view of the fact that so many freedom rights were specifically enumerated in other sections of the Constitution. Despite this awareness, they chose to confer the higher level of protection on these rights in proviso (aa) to section 33(1). In my view, this decision, which is quite unambiguous, must be respected by this Court. It is not our function to cut down artificially the patent protection afforded by section 11(1) to residual freedom rights by giving a limited construction, and a strained one at that, to these residual freedom rights. Second, such a construction would be in conflict with the “generous” and “full benefit” interpretative approach unanimously approved by this Court in S v Zuma and Others[62] and in particular the following quotation approved of by Kentridge AJ:        

“Constitutional rights conferred without express limitation should not be cut down by reading implicit restrictions into them, so as to bring them into line with the common law.”[63]

 

I respectfully disagree with the President's view that those freedoms (and by implication other rights) whose limitation is made subject to the "necessary" test by section 33 of the Constitution are necessarily of a "higher order" than those freedoms which are not subjected to such an onerous test. A limitation of the section 8 equality right, for example, is not made subject to the more stringent "necessary" test, yet in my view it could scarcely be said that this right is of a "lower" order. I therefore consider it unhelpful to focus, as the President does, on the fact that a limitation of the section 13 right to privacy is only subject to the "reasonable" test. I certainly disagree, with respect, that this is anomalous. Even if it were anomalous, I do not believe that the anomaly assists this Court in construing the section 11(1) right to freedom. It certainly does not call for what I would consider a strained and limited construction. There may well be good reason why the limitation of a section 13 right is only subject to the "reasonable" test. It may be because of the natural tension between this right and the right to freedom, or for some other reason, about which it is unprofitable to speculate. The fact that the guarantee against "torture" in section 11(2) is made subject to any limitation at all (particularly when regard is had to the fact that both the International Covenant on Civil and Political Rights and the European Convention on Human Rights outlaw any derogation from this right even in times of war[64] or public emergency threatening the life of the nation[65]) I find far more anomalous, but I do not consider such anomaly useful in construing other provisions of Chapter 3.

 

 

[59]           It needs to be emphasised that what is being contended for in this judgment is not an unlimited right to  freedom or that the section 11(1) residual freedom rights are unlimited. What is being postulated is a broad and generous construction of these rights, which is quite different from contending that they are unlimited. These rights are indeed subject to limitation, but limitation justified in terms of section 33(1) of the Constitution.

 

[60]           It might be contended that, by giving a broad and generous construction to the section 11(1) residual freedom rights, the Court will, in the fields of criminal law and general regulatory provisions for example, be dragged into what are essentially legislative functions, because the state will be called upon to show in all these cases that the limitations imposed are necessary. I cannot, however, see that this differs in any principled way from the task which the Court has to discharge when it tests any legislative or regulatory provision against the provisions of the Constitution in order to determine the validity of the former. Provisos (aa) and (bb) to section 33(1) embody an extensive array of Constitutional rights which, if infringed by any criminal statute or regulatory provision, would require the state (when rights enumerated in proviso (aa) are infringed and, in certain circumstances, when rights enumerated in proviso (bb) are infringed) to establish that limitations are, in addition to any other requirement, also necessary.

 

[61]           It might also be contended that, by giving such a broad and generous construction to the section 11(1) residual freedom rights, the Court will be inviting an intolerable workload because it will be obliged to test a multitude of criminal and other statutory provisions which are challenged on the grounds, inter alia, that the limitations thus placed on residual freedom rights are not necessary. Such an argument could proceed on the following basis:

 

            (a)       that the majority of these statutory provisions will only be attacked if the right to freedom in section 11(1) is not narrowly construed;

                        (b)       that the court will be flooded with frivolous complaints; and

                        (c)        that the court is powerless to prevent this.

In my view none of these premises can be assumed and all are unfounded.

 

[62]           Depending on the nature of the criminal or other regulatory statutes involved, there are likely to be many other Chapter 3 rights which are facially involved. It cannot simply be postulated that an internally unlimited residual freedom right will open the floodgates.

 

[63]           It is patent that the overwhelming substance of criminal and other regulatory legislative provisions constitute constitutionally justified limitations on rights, a fact which I believe is well recognised even by the lay public. It is unduly pessimistic to expect a deluge of frivolous challenges to legislation based simply on a broad reading of the section 11(1) right to freedom. In any event it is reasonable to suppose that most challenges will arise either in the Provincial and Local Divisions of the Supreme Court or in other Courts. In both cases the Supreme Courts (either through section 102(1) of the Constitution or section 103(4), in the case of matters originating in other Courts) are well able, by a proper application of these provisions in the Constitution, to dispose of challenges where there is not a reasonable prospect that the law or provision is invalid.               

 

 

[64]           This Court itself controls direct access through the provisions of section 100(2) of the Constitution and the Constitutional Court rules, in particular rule 17. The United States and German courts of equivalent jurisdiction have devised effective means of preventing docket overload and there is no reason to believe that this Court is not able to do likewise.  If a frivolous or vexatious matter does succeed in slipping through the net there are appropriate ways (including an appropriate punitive order as to costs) by which this Court could discourage such matters from being brought before it.

 

 

[65]           There may also be the anxiety that, unless freedom is given a more restricted meaning, this Court will inevitably be drawn into matters which are the concern of the Legislature rather than the Courts and could stand accused of what Tribe has described as being the error in decisions such as Lochner v New York[66] which was “a misguided understanding of what liberty actually required in the industrial age.”[67] I believe this fear to be unfounded.  Lochner, a case in which the United States Supreme Court invalidated maximum hour work laws as violative of contractual liberties protected by the Constitution, was decided in 1905 at a time and in a socio-economic context completely different from ours in 1995. I do not believe that we ought to allow ourselves to be haunted by the Lochner ghost. It is to me inconceivable that the broad sweep of labour legislation in this country[68] could be struck down because of an argument that it infringed rights of contractual freedom protected by the Constitution. This is so for a number of reasons. 

 

 

[66]           First, the interventionist role of the state is no longer seen, in broad terms, as being limited to protecting its citizens against brute physical force and intimidation from others only, but is seen as extending to the economic and social realm as well.[69] Second, there are specific provisions in the Constitution itself which will ensure that appropriate labour and other social legislation will not be invalidated because of a “misguided understanding” of what liberty requires.[70] Third, statutory limitations on contractual freedom will (quite apart from the importance in this field of the provisions of section 26(2) of the Constitution)[71] be justified under section 33(1), assuming the other requirements for limitation to have been fulfilled, if they are, in terms of section 33(1)(a)(ii), “justifiable in an open and democratic society based on freedom and equality”. As a general proposition it is difficult to see how labour and other social legislation would be struck down where such legislation easily passes constitutional scrutiny in countries such as the United States of America, Canada and Germany.

 

 

[67]           It has been suggested that the “due process” provisions of section 25, the prohibition against cruel, inhuman or degrading punishment in section 11(2) and the fact that substantive criminal law must not be inconsistent with the provisions of Chapter 3, provide  accused persons with all the protection that one expects in an “open and democratic society based on freedom and equality” and that this is a strong reason for holding that “freedom and security of the person" in section 11(1) should not be construed as including freedom from criminal prosecution and imprisonment in accordance with the laws of the land. This is a very broad proposition which would, in my view, require for its justification a very detailed examination of our criminal law and the possible abuses to which it could be put. It is a proposition with which I am in any event unable to agree.  One can think offhand of many prohibitions (such as an unqualified prohibition against the possession of any fire-arm, the possession of liquor in any form, the playing of sport on Sunday, and the proscription of various activities or where or when they may be carried out) which might be difficult to challenge under provisions of Chapter 3 other than the section 11(1) residual freedom rights, but would be unacceptable in an “open and democratic society based on freedom and equality”.

 

[68]           A major difficulty with reading a limitation into section 11(1) where the framers have not seen fit to do so is the absence of any neutral principle or norm for doing so. Neither the text, context nor purpose of Chapter 3 requires it. To read a limitation into the subsection in these circumstances is to run the risk of injecting subjective values into the text at the expense of a proper interpretation of the Constitution.

 

[69]            Even though the freedom rights in section 11(1) are residual freedom rights, there is no justification for not giving these residual freedom rights the broad and generous interpretation I have suggested. They constitute the residual rights of individuals (where such or similar rights are not protected elsewhere in Chapter 3) not to have “obstacles to possible choices and activities” placed in their way by (for present purposes we need not, as already indicated, go any further) the State.[72]

 

 

[70]           What is it about the nature and operation of the provisions of section 417(2)(b) of the Act, and their impact upon the examinee, which can be said to be inconsistent with the right in question? Although it is section 417(2)(b) of the Act which is under attack, it must be analysed in the full context of its operation with other relevant provisions of the Act. In the first place, the examinees, if they fall within the classes of persons referred to in sub-section (1) of section 417 of the Act (which all the applicants do) appear at the examination under compulsion, for if they are duly summoned and fail to attend voluntarily, the Master or the Court may, by virtue of the provisions of sub-section (4) cause them to be apprehended and brought before the Master or Court for examination. The examinee has no choice but to attend. The examinee is, in terms of sub-section (2) obliged to submit to examination. Moreover, any examinee who fails, without sufficient cause, to answer fully any question lawfully put to the examinee in terms of sub-section (2) is, in terms of the provisions of section 418(5)(b)(iii) of the Act, guilty of an offence and, in terms of section 441(1)(f), liable upon conviction to a fine not exceeding R2000 or to imprisonment for a period not exceeding six months or to both such fine and such imprisonment. Section 417 obliges the examinee to answer all questions even though the answer given to any such question may tend to incriminate him or her. Examinees thus have a very restricted choice if they have in the past acted in a way which might make them liable to criminal prosecution in connection with the trade, dealings, affairs or property of the company and they are examined in connection with such acts. If they refuse to answer, they face conviction and sentence to a fine or imprisonment (or both). If they answer, they run the risk of prosecution and conviction under circumstances where they might not have been prosecuted or convicted but for their answers at the examination, because section 417(2)(b) explicitly provides that even an answer which tends to incriminate the examinee may thereafter be used in evidence against him or her.

 

 

[71]           It must be remembered that this stage of the enquiry is not concerned with whether any infringement of an examinee's section 11(1) right is justified in terms of section 33(1) but merely whether the right has been infringed. On the basis of the general principles set forth above, I would conclude that, prima facie, the restrictions placed by section 417(2)(b) on an examinee's choices and activities constitute an infringement of section 11(1).

 

 

[72]           It is appropriate to consider whether comparable foreign case law would lead to a different conclusion. Direct comparison is of course difficult and needs to be done with circumspection because the right to personal freedom is formulated differently in the constitutions of other countries and in the international and regional instruments. Nevertheless, section 33(1) of our Constitution enjoins us to consider, inter alia, what would be “justifiable in an open and democratic society based on freedom and equality” and section 35(1) obliges us to promote the values underlying such a society when we interpret Chapter 3 and encourages us to have regard to comparable case law. In construing and applying our Constitution, we are dealing with fundamental legal norms which are steadily becoming more universal in character.  When, for example, the United States Supreme Court finds that a statutory provision is or is not in accordance with the “due process of law” or when the Canadian Supreme Court decides that a deprivation of liberty is not “in accordance with the principles of fundamental justice” (concepts which will be dealt with later) we have regard to these findings, not in order to draw direct analogies, but to identify the underlying reasoning with a view to establishing the norms that apply in other open and democratic societies based on freedom and equality.

 

[73]           Section 7 of the Canadian Charter entrenches the right to liberty and security of the person in terms narrower than section 11(1) of our Constitution. It provides:

"7.       Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice." (Emphasis added).

Section 8 of the Charter is to the following effect:

"8.       Everyone has the right to be secure against unreasonable search and seizure."

In Canada the general approach of the Courts is that there is a deprivation of liberty within the meaning of section 7 of the Charter where conduct is prescribed or proscribed by law, and imprisonment is a possible consequence of disobeying the law in question.[73] In Reference Re ss 193 and 195.1(C) of the Criminal Code Dickson CJC, writing for three of the six Justices, held that

"... there is a clear infringement of liberty in this case given the possibility of imprisonment contemplated by the impugned provisions."[74]

 

 

[74]           The decision of the Supreme Court of Canada in Thomson Newspapers Ltd. et al. v. Director of Investigation and Research et al[75] is particularly instructive. The Canadian Combines Investigation Act[76] (the "CI Act") provided for a system of investigation and research which allowed the Director to determine facts relevant to particular issues of market behaviour, including breaches of prescribed guidelines set forth in the Act. Section 17 of the Act allowed the Director of Investigation and Research, in the course of carrying out an investigation under the Act, to apply for an order requiring any person to be examined under oath and to produce business records. Section 20(2) of the Act protected examinees who were compelled to testify against subsequent use of their oral testimony in criminal proceedings against them, but not against the subsequent use of evidence derived from that testimony. Officers of Thomson Newspapers were served with orders to appear before the Restrictive Trade Practices Commission to be examined under oath and to make production of certain documents. They attacked section 17 of the CI Act on the grounds of its violation of sections 7 and 8 of the Canadian Charter. The Supreme Court of Canada ultimately held, Lamer and Sopinka JJ dissenting in part, and Wilson J dissenting, that section 17 of the CI Act violated neither section 7 or section 8 of the Charter.

 

 

[75]           Each member of the Supreme Court (Lamer, Wilson, La Forest, L'Heureux-Dubé and Sopinka JJ) gave a separate judgment. The reasons for all the judgments are not readily amenable to brief, accurate summary. They are, however, instructive both on the issue of the ambit of the right to liberty in section 7 of the Charter (the right to freedom in section 11(1) of our Constitution) and the possible limitation of such right in terms of section 1 of the Charter (section 33(1) of our Constitution). For the present part of this judgment I refer only to the former.

 

 

[76]           Section 17(1) of the CI Act makes provision, inter alia, for the examination on oath of persons before a member of the Commission who may make orders for securing the attendance of witnesses and their examination and "may otherwise exercise, for the enforcement of such orders or punishment for disobedience thereof, all the powers that are exercised by any superior Court in Canada for the enforcement of subpoenas to witnesses or punishment of disobedience thereof." Lamer J, without pronouncing on the section 7 issue, dismissed the section 7 challenge on the basis that the wrong section of the CI Act had been challenged, section 20(2) thereof and section 5(1) of the Canadian Evidence Act being the relevant statutory provisions which had to be challenged in order for the applicants to succeed.[77] Wilson J held that section 17 of the CI Act violated a person's right to liberty and security of the person within the meaning of section 7 of the Charter[78], stating that:

"There is, however, in my view a vast difference between a general regulatory scheme (such as the rules of the road for motorists) designed to give some order to human behaviour and a state-imposed compulsion on an individual to appear at proceedings against his will and testify on pain of punishment if he refuses. The difference is even greater, in my view, where the compelled testimony given by the individual may be used to build a case against him in what is, in effect, a subsequent criminal prosecution. It is my opinion that this compulsion, linked as it is to the criminal process, touches upon the physical integrity of the individual as well as that individual's reasonable expectation of privacy. The fact that the s. 17 procedure is in itself 'investigatory' as opposed to 'prosecutorial' seems to me to be irrelevant when a criminal prosecution is a potential consequence of the  s. 17 enquiry."[79]

The learned Judge also found that the infringement by section 17 of the appellants' section 7 rights was not "in accordance with the principles of fundamental justice"[80] (the phrase qualifying the section 7 right to "liberty and security of the person"), stating that:

"Although s. 20(2) of the Act protects a witness who testifies under s. 17 from use of the testimonial evidence in a subsequent prosecution if one takes place, it does not protect the witness against use of the derivative evidence. Accordingly, s.17 violates the residual s.7 right of an individual not to be compelled to testify in an investigatory proceeding with a view to possible subsequent prosecution absent legislative assurance that any derivative evidence obtained as a result of his testimony cannot be used against him in such prosecution."[81]

 

Section 11(1) of the South African Constitution of course contains no such limitation to the "right to freedom and security of the person"; but the possible significance of this aspect of the Thomson judgment for the present enquiry will be dealt with later. La Forest J also found that section 17 of the CI Act constituted a deprivation of liberty within the meaning of section 7,[82] but concluded that it did so in accordance with the principles of fundamental justice, holding that

".... complete immunity against such use [of derivative evidence] is not required by the principles of fundamental justice. The immunity against use of actual testimony provided by s. 20(2) of the Act together with the judge's power to exclude derivative evidence where appropriate is all that is necessary to satisfy the requirements of the Charter."[83]

 

L'Heureux-Dubé J came to a similar conclusion.[84] Sopinka J, concurring with Wilson J in this respect, held that section 17 of the CI Act violated section 7 of the Canadian Charter, "in particular, the principle of fundamental justice in which the right to remain silent is embodied" to the extent that the provisions of section 17 compelled testimony.[85] The learned Judge's reasons for concluding that section 17 violated this principle of fundamental justice will be considered in due course, but it is clear that he considered that "the right of a suspect to remain silent during the investigative stage" had the "status of a principle of fundamental justice" and that it was included in section 7, "the repository of many of our basic rights which are not otherwise specifically enumerated."[86]

 

[77]           The Fifth Amendment to the United States Constitution provides in part that -

 

"[No person] ... shall be compelled in any criminal case to be witness against himself, nor be deprived of life, liberty, or property, without due process of law".

In dealing with the Fifth Amendment it must of course be borne in mind, as pointed out by Wilson J in Thomson Newspapers[87], that the United States Constitution has no limitation clause (such as section 1 in the Canadian Charter or section 33(1) of our Constitution) and that, accordingly, any limitation on a constitutional right has to be read into the right itself. Nevertheless it is significant that the United States Fifth Amendment right not to be so compelled "has consistently been accorded a liberal construction"[88] and "is available outside of criminal court proceedings and serves to protect persons in all settings in which their freedom of action is curtailed in any significant way from being compelled to incriminate themselves."[89] It is regarded as a right in the broad panoply of freedom rights which were added to the original Constitution "in the conviction that too high a price may be paid even for the unhampered enforcement of the criminal law and that, in its attainment, other social objects of a free society should not be sacrificed."[90] It is viewed as one of the fruits of "[t]he battle for personal liberty".[91] In defining explicitly the spirit in which this privilege against self-incrimination should be approached, Frankfurter J stated that

 

"[t]his command of the Fifth Amendment ... registers an important advance in the development of our liberty - 'one of the great landmarks in man's struggle to make himself civilized.'"[92]

 

[78]           As far as the breadth of our present Constitution's section 11(1) right to freedom and security of the person is concerned, Thomson's case[93] provides some useful guidance. Reference has already been made[94] to the fact that the right to freedom is the foundation of many of the other rights that are specifically entrenched in the present Constitution. The existence of these other freedom-based or freedom-inspired rights does not warrant a restrictive interpretation being given to the section 11(1) rights. Section 13 of the Canadian Charter provides an individual with a limited protection against self-incrimination in the following terms:

 

"13.     A witness who testifies in any proceedings has the right not to have any incriminating evidence so given used to incriminate that witness in any other proceedings, except in a prosecution for perjury or for the giving of contradictory evidence."

Section 11(c) embodies a limited right of non-compellability:

"11.     Any person charged with an offence has the right

........

(c) not to be compelled to be a witness in proceedings against that person in respect of the offence."

In Thomson's case the appellants could not take advantage of either section 13 or section 11(c) but contended that section 7 protects similar rights in contexts other than those to which section 13, and section 11(c) relate. This contention was upheld by Wilson J who stated the following:

"The principle of statutory construction, expressio unius, is ill-suited to meet the needs of Charter interpretation. It is inconsistent with the purposive approach to Charter interpretation which has been endorsed by this court and which focuses on the broad purposes for which rights were designed and not on mechanical rules which have traditionally been employed in interpreting detailed provisions of ordinary statutes in order to discern legislative intent",

 

and,

 

"Sections 8 to 14 of the Charter are illustrative, but not exhaustive, of deprivations of life, liberty and security of the person which are not in accord with the principles of fundamental justice. Otherwise, s. 7 would have no role to play. I conclude therefore that the specific enumerations in ss.11(c) and 13 do not prevent residual content being given to s.7."[95]

 

This part of Wilson J's judgment was concurred in by Lamer J,[96] La Forest J,[97] L'Heureux-Dubé J[98] and Sopinka J (but only in regard to the section 11(c) right to remain silent).[99] For the reasons advanced by Wilson J,  I would hold that the fact that many other freedom rights are entrenched in our present Constitution does not for that reason mean that the section 11(1) right to freedom does not protect similar rights in contexts other than those to which the more particular freedom rights in the Constitution relate; the Court is not thereby precluded from giving "residual content" to section 11(1). The same considerations also do not warrant giving this residual freedom right a narrow construction. In Thomson, Wilson J construed the words "life, liberty and security of the person" disjunctively, holding that:

"it is not necessary for the citizen to show that his right to life, his right to liberty and his right to security of the person have all been violated in order to constitute a breach of the section. It is sufficient that one of them has been violated: see Singh v. Can. (Minister of Employment & Immigration) (1985), 17 D.L.R. (4th) 422, [1985] 1 S.C.R. 177, 14 C.R.R. 13."[100]

This is further support for the disjunctive reading of "freedom and security of the person" which I have favoured in para [41] above.

 

 

[79]           I would, more specifically and in the context of this case, apply the above interpretative approach to the rights enumerated in section 25(3)(c) and (d) respectively of the Constitution, namely the right of an accused person "to be presumed innocent and to remain silent during plea proceedings or trial and not to testify during trial" and "not to be a compellable witness against himself or herself". In Zuma[101] Kentridge AJ, writing for the Constitutional Court, pointed out that South African courts have over the years recognised the origins and the importance of the common law rule placing the onus of proving the voluntariness of a confession on the prosecution.[102] In this context he quoted with approval the following passage from R v. Camane 1925 AD 570 at 575:

"Now, it is an established principle of our law that no one can be compelled to give evidence incriminating himself. He cannot be forced to do that either before the trial, or during the trial. The principle comes to us through the English law, and its roots go far back in history. Wigmore, in his book on Evidence (Volume 4, section 2250) traces very accurately the genesis, and indicates the limits of the privilege. And he shows that however important the doctrine may be, it is necessary to confine it within its proper limits. What the rule forbids is compelling a man to give evidence which incriminates himself"[103] (Emphasis added).

After tracing the history of the embodiment of this rule in South African legislation, Kentridge AJ concluded that:

"the common law rule in regard to the burden of proving that a confession was voluntary has not been a fortuitous but an integral and essential part of the right to remain silent after arrest, the right not to be compelled to make a confession and the right not to be a compellable witness against oneself. These rights, in turn, are the necessary reinforcement of Viscount Sankey's 'golden thread' - that it is for the prosecution to prove the guilt of the accused beyond reasonable doubt (Woolmington's case (supra)). Reverse the burden of proof and all these rights are seriously compromised and undermined. I therefore consider that the common law rule on the burden of proof is inherent in the rights specifically mentioned in section 25(2) and 3(c) and (d), and forms part of the right to a fair trial."[104]

 

Even if it were not otherwise sufficiently clear from the wording of section 25(3)(c) or (d) that these rights include the right of accused not to be compelled to give evidence which incriminates themselves, the aforementioned approach unquestionably does. I conclude that the right of a person not to be compelled to give evidence which incriminates such person is inherent in the rights mentioned in section 25(2) and (3)(c) and (d). The fact that such rights are, in respect of an accused person, included (implicitly or otherwise) in section 25(3) of the Constitution, does not for that reason preclude the Court from giving residual content to section 11(1) and holding that section 11(1) protects rights similar to those in section 25(3)(c) or (d) in contexts and in respect of persons other than those there mentioned.

 

[80]           For this reason, the contention advanced by Mr. Cilliers that, because the section 25(3) rights were enumerated in such detail, it was not possible, on the proper construction of the Constitution as a whole, to interpret the section 11(1) right to freedom in such a way as to include a residual right not to be compelled to give evidence against oneself in a section 417 enquiry, cannot be sustained.

 

[81]           In Reference re s.94(2) of Motor Vehicle Act Wilson J observed:

"Indeed, all regulatory offences impose some restrictions on liberty broadly construed. But I think it will trivialize the Charter to sweep all those offences into s. 7 as violations of the right to life, liberty and security of the person even if they can be sustained under s. 1."[105]

 

I cannot, with due respect to so distinguished a Judge, comprehend why an extensive construction of freedom would "trivialize" the Charter, either in theory or in practice, or, more relevantly for our purposes, our present Constitution. It might trivialise a constitution (it would indeed cause chaos) if it resulted in the regulating measures being struck down. But that is not the consequence. An extensive construction merely requires the party relying thereon to justify it in terms of a limitation clause. It does not trivialise a constitution in theory; in fact it has the reverse effect by emphasising the necessity for justifying intrusion into freedom. It does not trivialise a constitution in practice because in the vast majority of cases dealing with regulatory matters, the justification is so obviously incontestable that it is taken for granted and never becomes a live issue. In the borderline cases (and even in mundane regulatory statutes such cases may arise) there is no pragmatic reason why the person relying on the measure ought not to justify it.

 

 

[82]           Section 11(1) of the transitional Constitution contains no internal limitation such as is found in section 7 of the Canadian Charter. There seems to be no reason in principle why the limitation of the right should not consistently be sought for and justified under section 33(1). The drafters of section 11(1) were undoubtedly well aware of the provisions of section 7 of the Canadian Charter, yet they decided not to place any limitation in section 11(1). Instead a detailed limitation clause has been crafted. It would seem to further the norms of the rule of law and of constitutionalism better for Courts, in applying the Constitution, to seek for any limitation to section 11(1) rights in section 33(1), where the Constitution lays down criteria for limitation, than to seek limits in section 11(1) by means of an interpretative approach which must of necessity, having regard to the nature of the right to freedom, be more subjective, more uncertain and more constitutionally undefined. In Zuma[106] this Court recognised the difference between the "single stage" approach and the "two-stage" approach to determining whether there has been an unconstitutional infringement of an entrenched right. It was further recognised that -

"The single stage approach (as in the United States constitution or the Hong Kong Bill of Rights) may call for a more flexible approach to the construction of the fundamental right, whereas the two-stage approach may call for a broader interpretation of the fundamental right, qualified only at the second stage."[107]

 

 

 

The fact that such a "two-stage" approach is prescribed by the Constitution, and that section 33(1) prescribes fully the criteria that have to be met before an entrenched right can be limited, in my view lends constitutional and policy support to an interpretative approach which requires that the broadest interpretation be given to the entrenched right. If a limitation is sought to be made at the first stage of the enquiry, it requires, at best, an uncertain, somewhat subjective and generally constitutionally unguided normative judicial judgment to be made. The temptation to, and danger of, judicial subjectivity is great. This Court would, in my view, be discharging its interpretative function best, most securely and most constitutionally, if, as far as is judicially possible, it seeks for any limitation of an entrenched right through section 33(1). It may well be that the Constitution itself, either because of the descriptive ambit of one or more of the many other rights entrenched in Chapter 3, or in some other way, expressly or by clear implication, indicates a limitation of an entrenched right at the first stage of the enquiry. Absent such an indication, the Court would be on safer constitutional ground if it were to find any limitation on the basis of the prescribed criteria in section 33(1). This approach will afford a better guarantee against the Court, however unwittingly, reading its own subjective views into the Constitution.

 

[83]           Article 2 of the German Basic Law deals with the right to freedom in two separate sub-paragraphs, namely:

"(1)      Everybody has the right to self-fulfilment in so far as they do not violate the rights of others or offend against the constitutional order or morality.

 

 (2)      Everybody has the right to life and physical integrity. Personal freedom is inviolable. These rights may not be encroached upon save pursuant to a law."

The formulation is patently different from that in section 11(1) of the transitional Constitution. The purpose of alluding to its provisions is not to attempt a direct comparison, but to illustrate that a Constitution can operate effectively where the widest possible construction is given to a freedom right. Article 2(2) is, it is generally agreed, given a very narrow construction which limits "personal freedom" to freedom from physical restraint.[108] Article 104 contains detailed rights applying to detention and arrest. The legislative history of article 2(2), the systematic structure of the fundamental rights and the existence of article 104 are used to support a narrow construction of article 2(2).[109]

 

 

[84]           By contrast Article 2(1) of the Basic Law has been interpreted so broadly by the Federal Constitutional Court that it presently allows the Court to subject any legislative norm (statutory instrument) to constitutional scrutiny, the culmination of a process the basis for which was laid in the late 1950's when the Court interpreted the right to self-fulfilment as a protection of the general "freedom to act".[110] The freedom to act is guaranteed to the extent that it does not offend against the constitutional order, which includes all statutory instruments[111], but, in order to pass constitutional scrutiny, all statutes must conform formally and substantively with the Basic Law. Formally the Court may, for example, examine whether the legislative provision was passed by the appropriate Legislature, but the substantive content of all legislative provisions are tested against the principle of proportionality.[112] The Federal Constitutional Court requires the principle of proportionality to be respected even if a special limitation to the right, such as the "constitutional order" is invoked by the Legislature.[113] The consequences of the extremely wide interpretation given to Article 2(1) is that, in effect, all legislative provisions must be tested for compliance with the principle of proportionality.[114]

 

 

[85]           The phrase “in so far as they do not violate the rights of others or offend against the constitutional order or morality” which qualifies the “right to self-fulfilment” in article 2(1) of the German Basic Law is not an internal qualification of this right for, as indicated above, the German Constitutional Court requires that all statutory provisions which prima facie limit this right be tested for compliance with the principle of proportionality. This is the equivalent of requiring all prima facie infringements of the residual freedom rights in section 11(1) of our Constitution to pass section 33(1) scrutiny. The German Constitutional Court has insisted on such justification according to the principles of proportionality in many cases.

 

 

 

[86]           In Elfes[115], the decision which laid the basis for the German Constitutional Court’s approach to section 2(1) as the general and residual freedom right (“Auffanggrundrecht”), the Court was concerned with the denial of an application for thepassport renewal of a leading member of a political party which opposed the West German government’s re-armament policy in the 1950s. Having rejected the petitioner’s reliance on the right to freedom of movement (section 11 of the Basic Law), on the basis that the right only guaranteed the right to move freely within the boundaries of the Federal Republic of Germany, the Court proceeded to consider the state’s justification for the legislation with reference to section 2(1) and the principle of proportionality. In casu the Court found that considerations of national security justified the law limiting the issuing of passports. Similarly, in 1980 the Court held that a government prohibition on the feeding of doves in a particular city passed constitutional muster.[116] The Court accepted that section 2(1) of the Basic Law had been infringed, but held that the prohibition related to the public’s interest in keeping the city clean and protecting property from damage caused by the doves. The public’s interest, the Court stated, had to be balanced against the relatively minor infringement of individuals’ section 2(1) right to express their affection for animals. In the same year, however, the Constitutional Court invalidated a requirement in Federal hunting laws which compelled those who sought to hunt with falcons to demonstrate their competence in the use of firearms[117]. Again none of the specific freedoms entrenched in the Basic Law applied to the situation, but the applicants successfully relied on the disproportionate infringement of section 2(1). The Court held that the required skill had no connection with the practice of falconry; in fact, the Court stated, falconers who discharged a firearm during the hunt would merely distract or even frighten their falcons. Other examples which illustrate the effect of the residual content found by the German Court in section 2(1) are those decisions dealing with the freedom not to be compelled to join public - as opposed to private -  associations. In a long line of decisions[118] the Court has excluded the possibility of relying on the freedom of association (section 9(1)) against this form of compulsion. The reasoning is that, since individuals may not invoke the right of freedom of association to establish  public associations (the state retains a discretion whether or not to confer public status on an association), individuals may also not rely on the right of freedom of association to refrain from joining such public associations. While excluding reliance on the right to freedom of association, the Court has acknowledged that the individual is protected from state compulsion to join public associations through the residual protection afforded by section 2(1) of the Basic Law.

 

 

[87]           One's sense is that the German Federal Constitutional Court seldom strikes down laws on the basis of section 2(1) - the general freedom of action. The reason seems to be that the Court shows deference to the legislature in many of the areas protected by the freedom and not because it is not prepared to test legislation against the principles of proportionality or because it subjects the legislation to a different type of limitation test. The German Court is more inclined to exercise a stricter form of scrutiny on the basis of section 2(1) when the infringement is somehow analogous to the infringement of another right or freedom, not dissimilar to the heightened scrutiny the US Supreme Court employs through the "fundamental rights" strand of jurisprudence under that part of the 14th Amendment that deals with due process.[119] In other words, when the other rights or freedoms, for some reason or another, do not apply, section 2(1) is activated. This is the situation with which we are dealing here. It is important to define section 11(1) broadly in the first stage of the enquiry because it cannot function as a residual freedom right if narrowly defined at this stage. If a broad residual freedom right is not acknowledged by the Court, the Court will not be able to develop any form of due process jurisprudence - procedural or substantive. There may be concerns about substantive due process and Lochner, but in the absence of a broad interpretation of section 11(1) we will not have a general procedural due process right either. In the present case we are concerned with process as much as with substance. We are not creating a right, we are asking the state to be consistent - procedurally - when it denies individuals their rights.

 

[88]           Article 9(1) of the International Covenant on Civil and Political Rights provides that-

“Everyone has the right to liberty and security of person. No one shall be subjected to arbitrary arrest or detention.  No one shall be deprived of his liberty except on such grounds and in accordance with such procedure as are established by law.”

The other sub-articles ((2) to (5)) of Article 9 deal with arrest and detention. In any event the last sentence in article 9(1) does not constitute an internal limitation of the right but provides scope for statutory limitation and it is not any ground or any procedure, even though established by law, which will justify deprivation of liberty.

 

[89]           Article 5(1) of the European Convention of Human Rights provides that-

            “Everyone has the right to liberty and security of person. No one shall be deprived of his liberty save in the following cases and in accordance with a procedure prescribed by law.”

 

The remaining provisions of article 5 (paragraphs 5(1)(a) - (f) and sub-articles 5(2) - 5(5)) deal exclusively with arrest and detention. The structure of the Convention is determinative of the interpretation of article 5. The Convention contains no general limitation provision, but special limitations are enumerated in relation to virtually all the protected rights and freedoms. The specialized order of limitation is of particular importance for the interpretation of article 5 since the exceptions enumerated in article 5(1)(a) - (f) constitute the only form of limitation to the right to freedom and security of the person. The exceptions merely recognise the legitimacy of arrest and detention in certain circumstances. The Commission and the Court, responsible for the interpretation of the Convention, are therefore confronted with the problem that it is not possible to assign a wide meaning to the terms “liberty” and “security” of the person in article 5(1) since the special limitation provisions deal exclusively with arrest and detention. If forms of conduct, other than the activity of being arrested or detained, were to be brought under the protection afforded by the right to liberty, those forms of conduct would in effect be insulated from state regulation altogether. A narrow definition of “liberty” also follows from the fact that the rights mentioned in sub-articles 5(2) - 5(5) only accrue to “arrested and detained” persons and not to persons who are deprived of their freedom in other respects. In this context it comes as no surprise that the Commission has held that:

“The term ‘liberty’ and ‘security’ must be read as a whole and, in view of its context, as referring only to physical liberty and security.  ‘Liberty of person’ in Article 5(1) thus means freedom from arrest and detention and ‘security of person’ the protection against arbitrary interference with this liberty.” [120]  (emphasis added)

 

 

This narrow definition also flows from the fact that the exceptions dealt with in paragraphs (a)-(f)  of sub-article 5(1) deal only with deprivation of liberty, and only in the context of arrest or detention. The context of section 11(1) in our Constitution is quite different, inasmuch as arrest and detention are dealt with in section 25(1) and (2) and the concluding phrase “which shall include the right not to be detained without trial” in section 11(1) indicates quite clearly that the preceding rights to freedom and security of the person do not constitute a numerus clausus.         

 

[90]           In the end result there appears to me to be no good reason for not giving section 11(1) the broad construction which I have suggested and requiring an infringement of its provisions to be justified under 33(1). The examinee, facing compulsion under section 417(2)(b) of the Companies Act to give self-incriminating testimony, is subjected "to the cruel trilemma of self-accusation, perjury or contempt".[121] On the basis of the considerations mentioned by Wilson J in Thomson's case, to which I have already referred, I have no doubt that the provisions of section 417(2)(b) of the Companies Act, which require an examinee summoned under sub-section (1) to answer, under pain of fine or imprisonment, or both, any question put to the examinee, notwithstanding that the answer might tend to incriminate the examinee and notwithstanding that any answer to any such question may thereafter be used in evidence against the examinee, infringe the examinee's section 11(1) right to freedom, more particularly the residual section 11(1) right of an examinee at a section 417 enquiry not to be compelled to incriminate himself or herself.

 

 

 

The right against self-incrimination.

[91]           Before dealing with the actual application of the provisions of section 33(1) to the infringement of the section 11(1) right in question, it is necessary to examine our own common law as well as the common law in other jurisdictions relating to provisions of the kind with which we are here dealing. This is necessary for general jurisprudential and constitutional reasons[122], but particularly so because section 33(1)(a) (ii) requires any limitation of a right to be justified in the context of an "open and democratic society based on freedom and equality" and section 35(1) mandates us, in interpreting Chapter 3, to "promote the values which underlie" precisely such a society.

 

[92]           In Zuma[123] Kentridge AJ briefly traced the history of the privilege against self-incrimination in English law. I propose to say nothing further on that score, save to suggest that it may at some future occasion become necessary in the light of recent research,[124] to reconsider the received wisdom (for which Wigmore has generally been credited[125]) that the privilege developed in response to the oppressive and often barbaric methods of the Star Chamber.

 

 

[93]           That the "privilege" or "immunity" against self-incrimination applies generally in the English common law in extra-judicial settings is beyond doubt. In Regina v. Director of Serious Fraud Office, Ex Parte Smith[126] Lord Mustill regarded it as a general immunity in "a disparate group of immunities, which differ in nature, origin, incidence and importance" which he categorised collectively as "the right of silence" and which he described as:

"A general immunity, possessed by all persons and bodies, from being compelled on pain of punishment to answer questions the answers to which may incriminate them."[127]

 

 

[94]           This also emerges clearly from the fact that, in a wide variety of situations, reliance on the immunity could only be rejected on the ground that it had been expressly or by implication abrogated by statute. In In re London United Investments Plc[128] it was held that the privilege against self-incrimination was not available to persons who were being examined by inspectors appointed by the Department of Trade and Industry under section 432 of the Companies Act 1985, because sections 434, 436 and 452(1) of the Act excluded the privilege by necessary implication. In Bank of England v. Riley and Another[129] it was held that it was not available to persons who were being examined by inspectors of the Bank of England under the Banking Act 1987, because it had been excluded by necessary implication. A relevant consideration in the latter judgment, however, was the fact that section 31(1) of the Theft Act 1968 provided that no information or documents produced in consequence of the order in question would be admissible in the prosecution pending against the respondent or in any further prosecution under the Theft Act 1968. Bishopsgate Investment Management Ltd. (In Provisional Liquidation) v. Maxwell and Others[130] was concerned with sections 235 and 236 of the Insolvency Act 1986, the purpose whereof was to bring together the law as to personal and corporate insolvency and, in the public interest, to provide a statutory framework in which the law could deal adequately with dishonesty and malpractice on the part of the bankrupt individual or the officers of a company. It was held that it would be contrary to the purposes of the Act if company directors, unlike an individual bankrupt, could rely on the privilege against self-incrimination to defeat the statutory right of the liquidator or other office-holder to obtain the necessary information required to manage the affairs of the company and that, accordingly, sections 235 and 236 of the Act had abrogated the privilege.[131]

 

 

[95]           In England, therefore, Parliament may abrogate the privilege against self-incrimination by statute. In doing so Parliament sometimes provides that a person may be compelled to answer questions which tend to incriminate but limits the use that may be made of his or her answers in any subsequent  prosecution. There are other examples of this approach. In Rank Film Distributors Ltd. and Others v. Video Information Centre and Others[132] the House of Lords held that the privilege against self-incrimination applied in the context of two respondents against whom certain "Anton Piller" orders[133] had been granted in connection with alleged acts of piracy of video tapes of films and which orders inter alia required them to furnish information concerning the video tapes.[134] In consequence of this judgment[135], section 72(1) of the Supreme Court Act 1981 was enacted to abrogate the privilege in intellectual property infringement or passing off proceedings; but it also provided that a statement or admission made by a person in answering questions put in such proceedings could not be used in a prosecution against such person for any related offence, or for the recovery of any related penalty, save in proceedings for perjury or contempt of court. The Criminal Justice Act 1987 established the Serious Fraud Office. Section 2 of the Act provides for the questioning of suspected offenders but it is expressly provided in section 2(8) that a statement made by a person in response to a demand for information under the section may only be used in evidence against such person in proceedings relating to the making of a false or misleading statement or in proceedings of a similar nature.[136]

 

 

[96]           In South African law the privilege is not limited to criminal or civil trial proceedings because

".... it is an established principle of our law that no one can be compelled to give evidence incriminating himself. He cannot be forced to do that either before the trial, or during the trial."[137]

The privilege has been described as one of the personal rights to refuse to disclose admissible evidence the particular right in terms whereof "a witness may refuse to answer a question where the answer may tend to expose him to a criminal charge"[138] and is also available, for example, to a person called as a witness in inquest proceedings.[139] With reference to the above quoted passage from R v. Camane, Thirion J observed in S v. Khumalo that

"[t]here is indeed even a greater need for protection of the accused against forced self-incrimination before the trial than there is at the trial."[140]

Hoffmann and Zeffert[141] also point out that the privilege may be claimed in administrative or quasi-judicial hearings. Lastly, mention should be made of section 65(2) of the Insolvency Act, No. 24 of 1936 which makes provision for the interrogation of the insolvent and other witnesses and stipulates that a person interrogated -

"shall not be entitled at such interrogation to refuse to answer any question upon the ground that the answer would tend to incriminate him or upon the ground that he is to be tried on a criminal charge and may be prejudiced at such trial by his answer."

 

Sub-section (2A)(b) does, however, confer use immunity on such incriminating answers given by the witness by providing that they shall not -

"be admissible in any criminal proceedings, except in criminal proceedings where the person concerned stands trial on a charge relating to the administering or taking of an oath or the administering or making of an affirmation or the giving of false evidence or the making of a false statement in connection with such questions and answers, and in criminal proceedings contemplated in section 139(1) relating to a failure to answer lawful questions fully and satisfactorily."

 

[97]           Two recent Australian decisions, Pyne Board Pty. Ltd v. Trade Practises Commission[142] and Sorby and Another v. The Commonwealth of Australia and Others[143], handed down on the same day by the High Court of Australia, may cast further light on the scope of the privilege against self-incrimination at common law. In both cases the majority of the High Court reached the conclusion that the privilege against self-incrimination is not inherently incapable of application in non-judicial proceedings, but that the availability of the privilege depends on a construction of the statute in question.[144] In Pyne Board the Court held that the statute by implication excluded reliance on the privilege and in Sorby the Court held that it did not. The reasoning of the Court in the latter case is of importance.  In response to the argument that the provision of a “use immunity” excludes  reliance on the privilege against self-incrimination the Court said, per Gibbs, CJ:

 

“In the absence of binding authority the matter must be approached from the standpoint of principle. If a witness is compelled to answer questions which may show that he has committed a crime with which he may be charged, his answers may place him in real and appreciable danger of conviction, notwithstanding that the answers themselves may not be given in evidence. The traditional objection that exists to allowing the executive to compel a man to convict himself out of his own mouth applies even when the words of the witness may not be used as an admission. It is a cardinal principle of our system of justice that the Crown must prove the guilt of an accused person, and the protection which that principle affords to the liberty of the individual will be weakened if power exists to compel a suspected person to confess his guilt. Moreover, the existence of such power tends to lead to abuse and to 'the concomitant moral deterioration in methods of obtaining evidence and in the general administration of justice’. Validity of Section 92(4) of the Vehicles Act, 1957 [Sask.], [1958] S.C.R. 608, at p. 619. It is true that in some cases the legislature may consider that it can only achieve the intended purpose of the statute by limiting or abrogating the privilege against self-incrimination, but, as I have said, if the legislature intends to render the privilege unavailable it must manifest clearly its intention to do so. To provide that the answers may not be used in evidence is not to reveal clearly an intention that the privilege should be unavailable, although, if the legislature did intend to remove the privilege, it might, in fairness, at the same time prevent the use in criminal proceedings of statements which otherwise would have been privileged: cf. Rank Film Ltd. v. Video Information Centre, at p. 448, per Lord Russel of Killowen.”[145]

 

The Court held that the privilege

"protects the witness not only from incriminating himself directly under a compulsory process, but also from making a disclosure which may lead to incrimination or to the discovery of real evidence of an incriminating character."[146]

Equally firm, however, was the rejection by the Court of the argument that the privilege against self-incrimination is constitutionally entrenched: 

 

“It was then submitted on behalf of the plaintiffs that s. 6A was not validly enacted. This argument cannot be accepted. The privilege against self-incrimination is not protected by the Constitution, and like other rights and privileges of equal importance it may be taken away by legislative action. Counsel for the plaintiffs sought to find some constitutional protection for the privilege in Ch III of the Constitution, and submitted that to remove the privilege would be to infringe the guarantee given by s. 80 and to interfere impermissibly with federal judicial power. ....[T]he argument that the compulsory examination of a suspected person is inconsistent with the right to trial by jury was rejected unanimously by the members of this Court in Huddart Parker & Co Pty. Ltd. v. Moorehead [1909] HCA 36; (1909), 8 C.L.R 330; see particularly at  pp. 358, 375, 385-386, 418. With all respect, I agree with the view that the privilege against self-incrimination is not a necessary part of a trial by jury.”[147]

 

[98]           In Canada, the courts have recognised the different nature and the consequently wider ambit of the privilege even before the adoption of the Canadian Charter of Rights and Freedoms. In Solosky v R the Supreme Court remarked:

"Recent case law has taken the traditional doctrine of the privilege and placed it on a new plane. Privilege is not longer regarded merely as a rule of evidence which acts as a shield to prevent privileged materials from being tendered in evidence in a courtroom. The Courts, unwilling to so restrict the concept, have extended its application well beyond these limits".[148]         

Moreover, the position in Canada never quite corresponded to that in the English common law, because sections 4(1) and 5 of the Canada Evidence Act[149] effected a change in the Canadian common law from 1893 onwards.  Wilson J, dissenting in Thomson  Newspapers, summarised the Canadian position as follows:

 

"The effect of s. 4(1) was to maintain the common-law rule of non-compellability at the investigatory stage, subject to the modification by the terms of a particular statute, and to make the accused at his trial a competent witness for the defence but not a compellable witness for the Crown. The effect of s. 5 was to abolish the common- law rule of allowing a witness to refuse to answer a question on the ground that it would tend to incriminate him and replace it with the rule that the witness must answer the question but the answer could not be used against him in a subsequent criminal case. This legislation reflects the state’s interest in having all available information before the tribunal so that a proper determination in that case can be made.  This state interest is achieved in derogation of the common-law rule protecting a witness from answering a question on the basis of the right against self-incrimination.”[150]

After stating that the right against compellability and the right against self-incrimination are “fundamental precepts of democratic societies which respect individual rights and freedoms”, Wilson J went on to describe the rationale for the right against self-incrimination as follows:

“Having reviewed the historical origins of the rights against compellability and self-incrimination and the policy justifications advanced in favour of their retention in more modern times, I conclude that their preservation is prompted by a concern that the privacy and personal autonomy and dignity of the individual be respected by the state. The state must have some justification for interfering with the individual and cannot rely on the individual to produce the justification out of his own mouth. Were it otherwise, our justice system would be  on a slippery slope towards the creation of a police state.”[151]

 

 

[99]           The Fifth Amendment to the United States Constitution, which provides, inter alia, that “[n]o person... shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law...” was initially interpreted as affording protection to individuals from federal authorities only. It was the passing of the Fourteenth Amendment in 1868, especially its prohibition - “nor shall any State deprive any person of life, liberty, or property, without due process of law...” - which brought about the decisive change in the protection of individual rights against the exercise of State power in that country. At first hesitantly and selectively, but from the beginning of the 1960's with greater conviction, the Supreme Court began to apply the Bill of Rights to the States via the Fourteenth Amendment.[152]

 

 

[100]       The freedom against self-incrimination was effectively incorporated against the states in Malloy v. Hogan.[153] The jurisprudence is important since it shows that the US Supreme Court is prepared to utilise the Fourteenth Amendment to extend procedural guarantees, such as the protection against self-incrimination, to situations where it did not seem to apply textually. The question as to whether the right against self-incrimination applies in extra-curial proceedings was not resolved, as one would have expected, in the context of the Fourteenth Amendment. Instead a broad and purposive interpretation of the Fifth Amendment’s right against self-incrimination made a resort to the Fourteenth Amendment unnecessary. As early as 1892 Justice Blackford remarked in Counselman v. Hitchcock that the “[privilege] is as broad as the mischief against which it seeks to guard”.[154] By the 1920's Justice Brandeis, writing for the Court, declared that “[t]he privilege [against self-incrimination] is not ordinarily dependent on the nature of the proceedings in which the testimony is sought or is to be used. It applies alike to civil and criminal proceedings, wherever the answer might tend to subject to criminal responsibility him who gives it.”[155] Finally, in 1973 Justice White stated that “[t]he [Fifth] Amendment not only protects the individual from being involuntarily called as witness against himself in a criminal prosecution but also privileges him not to answer official questions put to him in any other proceeding, civil or criminal, formal or informal, where the answers might incriminate him in future criminal proceedings.”[156] US Bankruptcy laws nowadays explicitly recognise the constitutional right against self-incrimination.[157] There can be little doubt that proceedings similar to the ones envisaged by section 417 of the Companies Act would have been interpreted to constitute a deprivation of liberty and that this would have triggered the due process clause, and more specifically, the right against self-incrimination which forms part of it.

 

 

 

The approach in the USA and Canada to resolving the tension between the privilege against self-incrimination and the interest of the State in investigative procedures of various kinds

[101]       In seeking guidance from the jurisprudence of other countries it is well to heed the warning that 

"[e]ach legal system, intertwined with a particular legal tradition, is predicated on a number of integrated elements, and to look at each piece-meal through a magnifying glass cannot provide an accurate picture of the whole nor can such an exercise take into account differences between the systems ... Fundamental justice may take different forms in different societies, given their own legal traditions."[158]

Nevertheless we are obliged, in construing and applying section 33(1), to give content to the phrase "justifiable in an open and democratic society based on freedom and equality". At the same time it is necessary to recognise (gratefully) that the roots of South African law draw sustenance from Western Europe, the United Kingdom (and derivatively from the other so-called "common law" countries) and from indigenous sources. It is also a fact that since 1945 fundamental human rights are steadily becoming internationalised (albeit not always or everywhere at the same pace and not without set-backs) at the international, regional and domestic constitutional levels.

 

 

[102]       Both in the United States and Canada, and also elsewhere, legislatures have sought a legislative solution to the tension between the privilege against self-incrimination and the interest of the State in investigative procedures of various kinds. This has been achieved by compelling examinees to answer questions even though the answers thereto might tend to incriminate them and, at the same, protecting the interests of the examinees by granting them either an indemnity against prosecution or conferring some form of use immunity in respect of compelled testimony. What is important to note is that the privilege has not, in most cases, simply been abolished by statute without providing some form of protection to the examinee. The somewhat fragmentary treatment in England has been alluded to above.

 

 

[103]       Initially in the United States, this compromise was attempted by legislation which excluded use of the evidence given by the examinee, but which did not indemnify the examinee against prosecution. The use immunity only applied to the evidence given by the examinee; it did not prevent the use of the examinee's testimony to search out other evidence to be used against the examinee in a criminal proceeding, which other evidence had not been gained by the compulsion to testify and to give self-incriminating evidence. In Counselman v. Hitchcock[159] the Supreme Court considered the constitutional validity of such a use immunity (a "direct use immunity") provided by section 860 of the Revised Statutes in the context of Grand Jury testimony and held that it was unconstitutional.[160] Under Section 2486 (c) of the Immunity Act of 1954, 18 USC an indemnity against prosecution was accorded to grand jury witnesses.[161] In Ullmann v. United States[162] Justice Frankfurter delivered the judgment of the majority of the Court. While emphasising that "the Fifth Amendment's privilege against self-incrimination ... registers an important advance in the development of our liberty"[163] and approaching the petitioner's claims "in this spirit of strict, not lax, observance of the constitutional protection of the individual",[164] he reaffirmed[165] the Court's earlier judgment in Brown v. Walker, decided some sixty years earlier, that compulsion to testify under protection of a similar immunity was constitutional:

"While the constitutional provision in question is justly regarded as one of the most valuable prerogatives of the citizen, its object is fully accomplished by the statutory immunity, and we are, therefore, of opinion that the witness was compellable to answer ..."[166]

 

[104]       In Kastigar v. United States[167] the Supreme Court had to consider the constitutionality of the following use immunity in 18 U.S.C. section 6002, which was afforded to a witness in a District Court when compelled to testify over a claim of Fifth Amendment privilege against compulsory self-incrimination:

 

".... no testimony or other information compelled under the order (or any information directly or indirectly derived from such testimony or other information) may be used against the witness in any criminal case, except a prosecution for perjury, giving a false statement, or otherwise failing to comply with the order."

An exclusion of this nature will be referred to as "a direct and derivative use immunity". The Court upheld the constitutionality of this provision on the basis that it left the witness and the prosecutorial authorities in substantially the same position as if the witness had claimed the Fifth Amendment privilege; consequently the immunity was "co-extensive with the privilege and suffices to supplant it".[168] In the course of giving judgment for the majority, Justice Powell stated the following:

"This total prohibition on use provides a comprehensive safeguard, barring the use of compelled testimony as an 'investigatory lead,' and also barring the use of any evidence obtained by focusing investigation on a witness as a result of his compelled disclosures.

 

A person accorded this immunity under 18 U.S.C. § 6002, and subsequently prosecuted, is not dependent for the preservation of his rights upon the integrity and good faith of the prosecuting authorities. As stated in Murphy:

 

'Once a defendant demonstrates that he has testified, under a state grant of immunity, to matters related to the federal prosecution, the federal authorities have the burden of showing that their evidence is not tainted by establishing that they had an independent, legitimate source for the disputed evidence. 378 US at 79 n. 18.'

 

This burden of proof, which we reaffirm as appropriate, is not limited to a negation of taint; rather, it imposes on the prosecution the affirmative duty to prove that the evidence it proposes to use is derived from a legitimate source wholly independent of the compelled testimony.

 

 

This is very substantial protection, commensurate with that resulting from invoking the privilege itself. The privilege assures that a citizen is not compelled to incriminate himself by his own testimony. It usually operates to allow a citizen to remain silent when asked a question requiring an incriminatory answer. This statute, which operates after a witness has given incriminatory testimony, affords the same protection by assuring that the compelled testimony can in no way lead to the infliction of criminal penalties. The statute, like the Fifth Amendment, grants neither pardon nor amnesty. Both the statute and the Fifth Amendment allow the government to prosecute using evidence from legitimate independent sources."[169] (Footnotes omitted)

 

[105]       The use immunity in section 20(2) of the CI Act which qualified the compulsion to testify and was the subject of enquiry in Thomson Newspapers read as follows:

"... but no oral evidence so required shall be used or receivable against such person in any criminal proceedings thereafter instituted against him, other than a prosecution under section 121 of the Criminal Code for perjury in giving such evidence or a prosecution under section 124 of the Criminal Code in respect of such evidence."[170]

It was a direct use immunity only and did not include a derivative use immunity such as was considered by the US Supreme Court in Kastigar. We are concerned with the constitutionality of a statutory compulsion to testify and an override of the privilege against self-incrimination with no indemnity against prosecution or use immunity of any nature. It is important, for our purposes, to consider the way in which policy considerations relating to use immunity were dealt with in Thomson. This will emerge more clearly later.

 

 

[106]       As indicated above,[171] it was only Wilson J and Sopinka J who came to the conclusion that the direct use immunity was insufficient to prevent section 17 of the CI Act from violating the "fundamental justice" provision in section 7 of the Canadian Charter (which qualified the right to "liberty and security of the person"). The purpose of the CI Act has authoritatively been stated to be the following:

"From this overview of the Combines Investigation Act I have no difficulty in concluding that the Act as a whole embodies a complex scheme of economic regulation. The purpose of the Act is to eliminate activities that reduce competition in the market-place. The entire Act is geared to achieving this objective. The Act identifies and defines anti-competitive conduct. It establishes an investigatory mechanism for revealing prohibited activities and provides an extensive range of criminal and administrative redress against companies engaging in behaviour that tends to reduce competition."[172]

Wilson J also pointed out that

"the Act contains numerous provisions enabling the Director to collect information relating to anti-competitive behaviour. Once this information has been obtained a variety of uses can be made of it, including the referral of the matter to the Attorney-General of Canada for possible prosecution."[173]

The Attorney-General is empowered, in terms of section 15(2) of the CI Act, to exercise all the powers and functions conferred by the Criminal Code on the Attorney-General of a province in any ensuing prosecution. Section 13 of the Canadian Charter which provides that

"[a] witness who testifies in any proceedings has the right not to have any incriminating evidence so given used to incriminate that witness in any other proceedings, except in a prosecution for perjury or for the giving of contradictory evidence"

only affords a limited protection against self-incrimination (I pause to point out that the immunity in the section is only a direct use and not a derivative use immunity). Likewise section 11(c) of the Charter, which enacts that -

"Any person charged with an offence has the right .....

 

(c)        not to be compelled to be a witness in proceedings against that person in respect of the offence;"

only affords a limited right of non-compellability.

 

[107]       Wilson J held that the examinees could not avail themselves of either section 13 or 11(c) of the Charter. After reviewing the historical origins of the rights against compellability and self-incrimination in a comparative perspective, Wilson J concluded that their preservation was

"prompted by a concern that the privacy and personal autonomy and dignity of the individual be respected by the state. The state must have some justification for interfering with the individual and cannot rely on the individual to produce the justification out of his own mouth. Were it otherwise, our justice system would be on a slippery slope towards the creation of a police state."[174]

Whilst appreciating

"the importance of getting at the truth in any proceedings, criminal or otherwise ...[o]therwise our justice system might grind to a halt through important evidence not being brought forward"[175]

the learned Judge nevertheless considered that this goal had to be subservient to the protection of the fundamental rights of the accused.[176] Following the reasoning of the United States Supreme Court in Kastigar[177], Wilson J concluded as follows:

 

"It seems to me that in order to prevent a suspect from being conscripted against himself in a criminal or quasi-criminal proceeding (which would clearly include a charge of predatory pricing under the Combines Investigation Act), the suspect must be protected against the use of evidence derived from testimony given at the earlier investigatory proceeding as well as against the use of the testimony itself. Otherwise the suspect is convicted, metaphorically if not literally, out of his own mouth. He has, as the US Supreme Court put it, through the use of the derivative evidence been 'forced to give testimony leading to the infliction of penalties affixed to criminal acts'."

and,

"The judge's discretion under S. 24(2)[178] is no guarantee of protection against the use of derivative evidence obtained as a result of a witness's compelled testimony. It is merely a discretion and one which is required to be exercised on a very specific basis, namely, whether or not the admission of the evidence would bring the administration of justice into public disrepute."

and,

"That exclusion must be a matter of principle and of right, not of discretion .....

I conclude, therefore, that s. 7 protects the witness in a subsequent criminal proceeding against the use of evidence derived from testimony given by him in an earlier proceeding, which protection is not available under either s. 11(c) or s. 13. Where a person's right to life, liberty and security of the person is either violated or threatened, the principles of fundamental justice require that such evidence not be used in order to conscript the person against himself."[179]

 

 

[108]       In dealing with the section 1 limitation provisions of the Canadian Charter, Wilson J held that both the "effective investigation of suspected criminal and quasi-criminal activity" and the opportunity "to monitor economic activity in Canada so as to ensure that the government's economic objectives are met" were each of sufficient importance to warrant infringement of individual rights and freedoms because "[s]ociety has a very real interest both in controlling crime and in ensuring the stability of the marketplace."[180] The learned Judge found, however, that, inasmuch as the legislation in question did not impair the right in question as little as possible, the limitation was not justified under section 1 of the Charter.[181] In this regard Wilson J stated the following:

"There is no evidence to suggest that the government's objective in this case would be frustrated if individuals compelled to testify were afforded derivative use protection. Certainly, the monitoring of the Canadian economy would not be injuriously affected by such protection. Moreover, while there may be instances when the investigation of crime or the effective enforcement of legislation may be hampered if suspects are not conscripted against themselves, such a case has not been made out here. No evidence has been presented to the Court to show that the enforcement of the Combines Investigation Act will be drastically impaired if derivative use protection is given to persons testifying under s. 17"[182] (emphasis added)

Sopinka J held that, for the reasons given by Wilson J, section 17 of the CI Act "violates s. 7 of the Canadian Charter of Rights and Freedoms, in particular, the principle of fundamental justice in which the right to remain silent is embodied."[183] In this context he also expressed himself as follows:

"Obtaining evidence from suspects as a basis for commencing criminal proceedings is not a merely incidental effect of s. 17 of the Act. In this field of anti-competitive crime the police work is carried out largely, if not exclusively, by the Director and his staff."[184]

 

Sopinka J also concluded, for the reasons expressed by Wilson J, that the violation of section 7 could not be justified under section 1 of the Charter.[185]

 

[109]       I have referred somewhat extensively to the judgments of Wilson and Sopinka JJ, although their judgments were in dissent, because they represent the high-water mark in the judgment for striking down a provision which compels self-incrimination and only affords a direct use immunity. The judgment of La Forest J is particularly instructive. La Forest J points to the difference in discovering and investigating ordinary crimes on the one hand and violations of combines legislation on the other; in the former there is usually no question that an offence has been committed and the concern is to establish who committed the offence, while in the latter the position is quite different and the difficulty relates equally to establishing whether an offence has been committed.[186] It has been emphasised that

 

"economic crimes are far more complex than most other federal offences. The events in issue usually have occurred at a far more remote time and over a far more extensive period. The 'proof' consists not merely of relatively few items of real evidence but of a large roomful of often obscure documents. In order to try the case effectively, the Assistant United States Attorney must sometimes master the intricacies of a sophisticated business venture. Furthermore, in the course of doing so, he, or the agents with whom he works, often must resolve a threshold question that has already been determined in most other cases: Was there a crime in the first place? To use the colloquial, it is not so much a matter of 'Whodunit' as 'what-was-done'."[187] (Emphasis in original)

 

 

I shall revert to this aspect of the problem later. La Forest J also observed that,

"the community's interest is one of the factors that must be taken into account in defining the content of the principles of fundamental justice."[188]

 

In this regard the learned Judge made the following point, which is also relevant in the context of this case:

"I see a significant difference between investigations that are truly adversarial, where the relationship between the investigated and investigator is akin to that between accused and prosecution in a criminal trial, and the broader and more inquisitorial type of investigation that takes place under s. 17 of the Act. The lower probability of prejudice the latter represents to any particular individual who comes within its reach, together with the important role such investigations play in the effective enforcement of anti-combines and possibly other regulatory legislation, suggests that a more appropriate balance between the interests of the individual and the state can be achieved by retention of the power to compel testimony and the recognition of the right to object to the subsequent use of so much of the compelled testimony as is self-incriminatory."[189]

 

[110]       In dealing with the difference between "use immunity" and "derivative use immunity", the learned Judge observed that

"Simply because Parliament has provided for the inadmissibility of certain evidence does not mean that it thereby intended that other evidence should be admitted, even when either at common law or under the Charter, such evidence would be rejected on the ground that admitting it would be unfair. It is quite reasonable for Parliament to have dealt with the obvious case of unfairness resulting from the use of self-incriminating testimony, leaving more subtle situations to be dealt with in the application of general principles."[190] (emphasis added).

and that

 

"The witness's oral testimony cannot, of course, be used against him or her. Section 20(2) so provides and I have no doubt that this would, in any event, be the case either under s. 7 or s. 11(d) of the Charter.[191] (emphasis added).

 

[111]       In the following significant passages La Forest J points to a fundamental distinction between the direct use of compelled testimony and derivative use:

"The fact that derivative evidence exists independently of the compelled testimony means, as I have explained, that it could also have been discovered independently of any reliance on the compelled testimony. It also means that its quality as evidence does not depend on its past connection with the compelled testimony. Its relevance to the issues with which the subsequent trial is concerned, as well as the weight it is accorded by the trier of fact, are matters that can be determined independently of any consideration of its connection with the testimony of the accused. If it were otherwise, it would not, in fact, be derivative evidence at all, but part of the actual testimony itself. Taken together, these aspects of derivative evidence indicate that it is self-sufficient, in the sense that its status and quality as evidence is not dependent on its relation to the testimony used to find it. In this regard, the very phrase "derivative evidence" is somewhat misleading.

 

Seen from this light, it becomes apparent that those parts of derivative evidence which are incriminatory are only self-incriminatory by virtue of the circumstances of their discovery in a particular case. They differ in this respect from incriminatory portions of the compelled testimony itself, which are by definition self-incriminatory, since testimony is a form of evidence necessarily unique to the party who gives it.

 

 

I would think that this, without more, raises doubts as to whether we should be as wary of prosecutorial use of derivative evidence as we undoubtedly must be of such use of pre-trial testimonial evidence. What prejudice can an accused be said to suffer from being forced to confront evidence 'derived' from his or her compelled testimony, if that accused would have had to confront it even if the power to compel testimony had not been used against him or her? I do not think it can be said that the use of such evidence would be equivalent to forcing the accused to speak against himself or herself; once the derivative evidence is found or identified, its relevance and probative weight speak for themselves. The fact that such evidence was found through the evidence of the accused in no way strengthens the bearing that it, taken by itself, can have upon the questions before the trier of fact. In this respect, if reference to its origins was not precluded by an immunity such as that presently found in s. 5 of the Canada Evidence Act, it would in most cases be precluded by simple irrelevance."[192]

 

and,

 

"This raises a question of crucial importance in understanding the Collins line of cases and their relevance to a determination of the scope of testimonial immunity required by the principles of fundamental justice; why is the prior existence of evidence regarded as relevant to the fairness of the trial in which it is introduced?

 

There can be only one answer to this question. A breach of the Charter that forces the eventual accused to created evidence necessarily has the effect of providing the Crown with evidence it would not otherwise have had. It follows that the strength of its case against the accused is necessarily enhanced as a result of the breach. This is the very kind of prejudice that the right against self-incrimination, as well as rights such as that to counsel, are intended to prevent. In contrast, where the effect of a breach of the Charter is merely to locate or identify already existing evidence, the case of the ultimate strength of the Crown's case is not necessarily strengthened in this way. The fact that the evidence already existed means that it could have been discovered anyway. Where this is the case, the accused is not forced to confront any evidence at trial that he would not have been forced to confront if his Charter rights had been respected. In such circumstances, it would be the exclusion rather than the admission of evidence that would bring the administration of justice into disrepute."[193]

 

[112]       La Forest J, favouring a flexible approach to the question of derivative use immunity, stated:

 

"In this country, where the question of immunity falls to be determined under the principles of fundamental justice, I think we can achieve a more flexible balance between the interests of the individual and that of the state. In a case like this, where the statute does not provide for the evidence to be admitted, there can really be no breach of the Charter until unfair evidence is admitted. Until that happens, there is no violation of the principles of fundamental justice and no denial of a fair trial. Since the proper admission or rejection of derivative evidence does not admit of a general rule, a flexible mechanism must be found to deal with the issue contextually. That can only be done by the trial judge."

 

and,

 

 

"I see no reason why an approach like that in the now constitutionalized rule adopted in the case of prejudicial evidence should not be extended to derivative evidence which, like other prejudicial evidence within the rule, can only be dealt with having due regard to the need to balance the right of the accused and that of the public in a specific context. In my view, derivative evidence that could not have been found or appreciated except as a result of the compelled testimony under the Act should in the exercise of the trial judge's discretion be excluded since its admission would violate the principles of fundamental justice. As will be evident from what I have stated earlier, I do not think such exclusion should take place if the evidence would otherwise have been found and its relevance understood. There is nothing unfair in admitting relevant evidence of this kind, a proposition consistent with the cases under s. 24(2) of the Charter. The touchstone for the exercise of the discretion is the fairness of the trial process."[194]

 

The learned Judge concluded by stating:

 

"I conclude, then, that the use of derivative evidence derived from the use of the s. 17 power in subsequent trials for offences under the Act does not automatically affect the fairness of those trials. It follows that complete immunity against such use is not required by the principles of fundamental justice. The immunity against use of actual testimony provided by s. 20(2) of the Act together with the judge's power to exclude derivative evidence where appropriate is all that is necessary to satisfy the requirements of the Charter."[195] (emphasis added)

 

[113]       L'Heureux-Dubé J, without commenting on whether or how derivative use of compelled testimony should be controlled, also came to the conclusion that

"use immunity satisfies the requirements of fundamental justice under s. 7 of the  Charter. In the present appeal, such protection is afforded by s. 20(2) of the Act which was referred to earlier."[196]

 

Can the limitation of the examinee's section 11(1) constitutional residual right against self-incrimination by section 417(2)(b) of the Companies Act be justified under section 33(1) of the Constitution?

 

[114]       To meet the requirements of section 33(1) of the Constitution, any limitation of the section 11(1) right to freedom must:

(a)       be "reasonable";

(b)       be "justifiable in an open and democratic society based on freedom and equality";

(c)        "not negate the essential content of the right";

(d)       be "necessary".

 

(i)         The legislative history of sections 417 and 418 of the Companies Act

[115]       In order to determine the nature, extent and weight of the state's interest in the limitation in question, the legislative history and purpose of the investigation and examination procedures embodied in sections 417 and 418 of the Companies Act need to be examined. South African statutory company law has followed closely similar English legislation and drawn heavily on it, all the pre-Union statutes being based on earlier English company legislation.[197] The adoption of the South African Companies, Act 61 of 1973 has, however, "cut the umbilical cord between English and South African company law" which "though still based on the general principles of English law ... goes in many respects its own way."[198] Nevertheless, South African courts have considered English decisions to be authoritative (though of course not binding) in interpreting statutory provisions which are substantially the same, this being particularly the case in interpreting section 417 of the Companies Act and corresponding provisions.[199]

 

 

[116]       The concept of private examination was first introduced in England in the Companies Act of 1862. Section 115 of the English Companies Act of 1862 empowered the Court, after a winding-up order had been made, to summon before it any officer of the company or person known or suspected to have in his possession any of the estate or effects of the company or supposed to be indebted to the company or any person whom the Court might deem capable of giving information concerning the trade, dealings, estate or effects of the company. The Court could require any such officer or person to produce documents and, under section 117, the Court was empowered to examine on oath, either by word of mouth or upon written interrogatories, any person so appearing concerning the affairs, dealings, estate or effects of the company. The provisions were continued in the English Companies (Consolidation) Act of 1908, the Companies Act of 1929 and the Companies Act of 1948.[200] These provisions were repeated, without significant amendment, by sections of the 1985 Companies Act. The Insolvency Acts of 1985 and 1986 introduced major reforms both to the law of personal bankruptcy and to winding-up, the aim of these statutes being to promote harmony between the systems of personal and corporate insolvency. The result of the Insolvency Acts was to remove from the 1985 Companies Act all provisions relating to winding-up and receiverships. The English private examination provisions are now contained in sections 236 and 237 of the 1986 Insolvency Act.

 

 

[117]       The Joint Stock Companies Limited Liability Act 23 of 1861 of the Cape contained no winding up or examination provisions. These were introduced by the Cape Winding-Up Act, 12 of 1868, based on similar provisions in the English Companies Act of 1862. Section 33 of the Cape Act (which was taken over verbatim from section 115 of the English Act) provided that the Court, after it had made an order for winding up, could summon before it -

"any officer of the company or person known or suspected to have in his possession any of the estate or effects of the company, or supposed to be indebted to the company, or any person whom the court may deem capable of giving information concerning the trade, dealings, estate, or effects of the company ..."

Section 34 of the Cape Act, following closely the provisions of section 117 of the English Act, authorised the Court to examine any person appearing or brought before it "in manner aforesaid, or whom it may be desired to examine,” concerning "the affairs, dealings, estate, or effects of the company...". The passage emphasised above was an addition to the corresponding English provision.

 

[118]       The Transvaal Act, 31 of 1909, which borrowed heavily from the English Companies (Consolidation) Act of 1908, served as a model for the first South African Companies Act (46 of 1926).[201] Section 151(1) of the Transvaal Act, 31 of 1909, (which was in terms identical to section 174(1) of the English Companies (Consolidation) Act 1908 and closely resembled section 33 of the Cape Winding-up Act, 12 of 1868, provided for the private examination of -

 

"any officer of the company or person known or suspected to have in his possession any property of the company or supposed to be indebted to the company, or any person whom the Court deems capable of giving information concerning the trade, dealings, affairs, or property of the company."

Section 152(1) (which in terms closely resembled section 175(1) of the aforementioned English Act) provided for the public examination of the promoter, director or officer of a company who, in the opinion of the Master, had committed a fraud in relation to the company. It should be noted that section 151(2) of the Transvaal Act obliged the examinee to answer any question put to him or her in the private examination "notwithstanding that the answer might tend to incriminate him", but that a direct use immunity was given in the following terms:

"Provided that any answer given to any such question shall not be used against him in any prosecution other than for perjury or for the offence under this Act of giving false evidence."

Section 152(5) contained a similar ouster of the examinee's privilege against self-incrimination in the public examination, without providing any indemnity against prosecution or use immunity. This appears to be the first occasion in South Africa where the privilege against self-incrimination has been ousted completely without provision for use immunity in the context of an examination following on the winding up of a company.

 

 

[119]       Section 155 of the Companies Act, 46 of 1926, made provision for private examinations in terms identical to those in section 151(1) of the Transvaal Act mentioned above and section 156 provided for public examination before the Court in terms very similar to that provided in section 152(1) of the Transvaal Act, save that section 156(1) included any creditor of the company in the list of persons who could be examined. Both sections 155 and 156 ousted the examinee's right against self-incrimination, but provided no indemnity or use immunity to the examinee in either case. Section 194 introduced, for the first time, a provision allowing the Court to appoint a commissioner for the purpose of taking evidence or holding an enquiry under the Act, which provision was the forerunner of section 418 of the 1973 Companies Act. Sections 180 bis and 180 ter were introduced into the 1926 Companies Act by section 105 of the Companies Amendment Act of 1952.[202] In terms of section 180 bis, all the directors, the manager and the secretary of a company in liquidation were to attend meetings of creditors. The Master, or other presiding officer at such a meeting, could also, in terms of section 180 bis, subpoena to the meeting -

"any person who is known or on reasonable grounds believed to be or to have been in possession of any property which belongs or belonged to the company or to be indebted to the company, or any person who in the opinion of the Master or such other officer may be able to given any material information concerning the company or its affairs ..."[203]

Section 180 ter made provisions for the examination, at a meeting of creditors of a company being wound up and unable to pay its debts, of a director or any other person present at the meeting -

"concerning all matters relating to the company or its business or affairs ... and concerning any property belonging to the company ..."[204]

 

Section 180 quat inter alia made the provisions of sections 64 to 68 of the Insolvency Act 1936 applicable to 180 bis and 180 ter. In terms of the proviso to section 65(2) of the Insolvency Act 1936, as it existed at the time, a person interrogated under subsection (1) was "not entitled at such interrogation to refuse to answer any question upon the ground that the answer would tend to incriminate him" and subsection (5) provided that any evidence given under section 65 "shall be admissible in any proceedings instituted against the person who gave that evidence."

 

[120]       Sections 180 bis and 180 ter of the 1926 Companies Act have been repeated in the extant Companies Act, 1973, in sections 414 and 415 respectively. The present Companies Act makes no provision for public examinations before the Court.[205] Section 417 of the present Act does, however, make provision for private examinations in terms not dissimilar to section 155 of the 1926 Companies Act. It is to be noted that section 416 (1) of the Companies Act inter alia makes the provisions of section 65 of the Insolvency Act applicable to the interrogation of any person under section 415, "in so far as they can be applied and are not inconsistent with the provisions of this Act," as if such person were being interrogated under section 65 of the Insolvency Act 1936. In 1989 subsection (2A) was inserted in section 65 of the Insolvency Act.[206] It reads as follows:

 

"(2A) (a)  Where any person gives evidence in terms of the provisions of this section and is obliged to answer questions which may incriminate him or, where he is to be tried on a criminal charge, may prejudice him at such trial, the presiding officer shall, notwithstanding the provisions of section 39(6), order that such part of the proceedings be held in camera and that no information regarding such questions and answers may be published in any manner whatsoever.

 

      (b)  No evidence regarding any questions and answers contemplated in paragraph (a) shall be admissible in any criminal proceedings, except in criminal proceedings where the person concerned stands trial on a charge relating to the administering or taking of an oath or the administering or making of an affirmation or the giving of false evidence or the making of a false statement in connection with such questions and answers, and in criminal proceedings contemplated in section 139(1) relating to a failure to answer lawful questions fully and satisfactorily.

 

      (c)  Any person who contravenes any provision of an order contemplated in paragraph (a), shall be guilty of an offence and liable on conviction to the penalty mentioned in subsection (5) of section 154 of the Criminal Procedure Act, 1977 (Act No. 51 of 1977)."

 

[121]       It has been suggested[207] that the person interrogated in proceedings under section 415 of the Companies Act enjoys the benefits of the direct use immunity provided for in section 65(2A)(b) of the Insolvency Act, by virtue of the operation of the particular provision in section 416(1) of the Companies Act, referred to above; and it has also been so held in Podlas v. Cohen and Bryden NNO and Others,[208] where Spoelstra J stated the following:

 

"I am not persuaded that the judgment of van Niekerk J[209] is correct and that those of Goldblatt J[210] and De Villiers J[211] are clearly wrong. On the contrary, Van Niekerk J's judgment is open to criticism that it overlooked important considerations which, had they been considered, might have resulted in a different conclusion. First, s. 416 of the Companies Act provides that S. 65 of the Insolvency Act shall be applied to interrogations under s. 415 of the Companies Act. Section 65(2A) of the Insolvency Act provides that incriminating evidence shall be ordered to be given in camera and that no information regarding such questions and answers may be published in any manner whatsoever. No evidence regarding incriminating questions and answers shall be admissible in any criminal proceedings except in perjury proceedings. Had these provisions been brought to Van Niekerk J's attention, it is very doubtful that he would have found that there was any real prejudice to the applicant." (emphasis and footnotes added).

The inescapable inference from the above is that Spoelstra J considered that the direct use immunity provided for in section 65(2A)(b) of the Insolvency Act applied to incriminating evidence given by a person interrogated under section 415 of the Companies Act. Spoelstra J has, in my view, overlooked the important qualification in section 416(1) itself, namely that the provisions of section 65 of the Insolvency Act are only applicable to the interrogation of a person under section 415 of the Companies Act "in so far as they can be applied and are not inconsistent with the provisions" of the Companies Act. Subsection (3) of section 415 provides expressly that -

"No person interrogated under subsection (1) shall be entitled at such interrogation to refuse to answer any question upon the ground that the answer would tend to incriminate him."

and subsection (5) further expressly provides that -

"Any evidence given under this section shall be admissible in any proceedings instituted against the person who gave that evidence or the body corporate of which he is or was an officer."

 

When these two provisions are read in conjunction with one another they leave open no possible construction other than that the testimony of persons interrogated under section 415, even though it might tend to incriminate them, is admissible against such persons in subsequent proceedings against them, even in subsequent criminal prosecutions. The expression "... admissible in any proceedings instituted against the person who gave that evidence" is too wide and unqualified to admit of any other construction. The direct use immunity, provided for in section 65(2A)(b) of the Insolvency Act, is therefore clearly inconsistent with the combined effect of these provisions in section 415 and to that extent are inapplicable. I accordingly disagree with Spoelstra J's conclusion that "[n]o evidence regarding incriminating questions and answers shall be admissible in any criminal proceedings except in perjury proceedings."

 

(ii)        The statutory purpose of the section 417 and 418 procedures

[122]       The way is now clear to determine the statutory purpose of the interrogation and other procedures in the Companies Act 1973 and, in particular, those in section 417 and 418. Some of the major statutory duties of the liquidator in any winding-up are:

(i)         to "proceed forthwith to recover and reduce into possession all the assets and property of the company, movable and immovable ..."[212]

 

(ii)        to "give the Master such information ... and generally such aid as may be requisite for enabling that officer to perform his duties under this Act."[213]

 

(iii)       to "examine the affairs and transactions of the company before its winding-up in order to ascertain -

 

 

(a)       whether any of the directors and officers or past directors and officers of the company have contravened or appear to have contravened any provision of this Act or have committed or appear to have committed any other offence; and

 

(b)       in respect of any of the persons referred to in paragraph (a), whether there are or appear to be any grounds for an order by the Court under section 219 disqualifying a director from office as such."[214]

 

(iv)       Except in the case of a members' voluntary winding-up, to report to the general meeting of creditors and contributories of the company, the causes of the company's failure, if it has failed.[215]

If the liquidator's report contains particulars of contraventions or offences committed or suspected to have been committed or of any of the grounds mentioned in (iii)(a) and (b) above, the Master must transmit a copy of the report to the Attorney-General.

 

[123]       The purpose of the enquiry under sections 417 and 418 is undoubtedly to assist liquidators in discharging these duties

"so that they may determine the most advantageous course to adopt in regard to the liquidation of the company";[216]

and

"to achieve his primary object, namely the ascertainment of the assets and liabilities of the company, the recovery of the one and the payment of the other, according to law and in a way which will best serve the interests of the company's creditors".[217]

 

As was pointed out in Moolman v. Builders and Developers (Pty) Ltd (In Provisional Liquidation): Jooste Intervening[218]:

"Appellant's counsel is plainly correct in his submission that to enquire into the company's affairs forms part of a liquidator's functions just as much as reducing the assets of the company into his possession and dealing with them in the prescribed manner does. In performing the former part of his functions he exercises an ancillary power without which the second part cannot properly be performed. It is only by enquiring that he is able to determine what is and what is not the property of the company, or who is and who is not a creditor or contributory. It is, moreover, obviously in the interest of creditors that doubtful claims which the company may have against outsiders be properly investigated before being pursued and that claims against the company also be properly investigated before they are admitted or rejected. It is for such reasons that both the South African and the Transkeian Companies Act contain elaborate provisions relating to the interrogation of directors and other persons at meeting of creditors or by a commissioner..."

The purpose of the interrogation may be directed exclusively at the general credibility of an examinee, where the testing of such person's veracity is necessary in order to decide whether to embark on a trial to obtain what is due to the company being wound up.[219]

 

 

[124]       It happens  not infrequentlythat the liquidation of a company is the result of mismanagement, indeed mismanagement involving fraud and theft, on the part of the directors and other officers of the company. Such persons are the only eyes, ears and brains of the company and often the only persons who have knowledge of the workings of the company prior to liquidation. They are often, because of their part in the mismanagement, fraud and theft, reluctant to assist the liquidators voluntarily in the discharge of their duties. This on occasion also applies to outsiders who, for reasons of their own, are reluctant to assist the liquidator voluntarily. That it is necessary, in the interest of creditors and indeed the wider public interest, to compel them to assist, is widely recognised. In Lynn NO and Another v. Kreuger and Others the following was said:

"In my view the procedure provided by sections 417 and 418 of the Companies Act is not primarily concerned with the prosecution of offenders. The sections are aimed at assisting officers of the court in the performance of their duty to the creditors of companies in liquidation, the Master and the Court. It is very often of fundamental importance for the liquidator of a company to find out what has been done with the assets of that company and how the company's business has been run. Speed is of the essence of effectiveness in such an enquiry because, all too often the liquidator must take early and urgent action in order to recover mismanaged or misappropriated assets for the benefit of creditors. The case under consideration seems to be an excellent example of the importance of the need for full information, at a comparatively early stage of the winding up. In this case, on the evidence which is before me, the probabilities indicate very strongly, if not overwhelmingly that the only person who can give the applicants the information which they require is the first respondent. I think that the first respondent's prospects of persuading the Constitutional Court that the 'interrogation procedure' in respect of people who have been involved in the dealings of a company before its liquidation is unconstitutional are remote indeed. I cannot conceive of any other procedure which would enable liquidators, effectively and efficiently, to fulfil their task."[220]

 In Cloverbay Ltd v. Bank of Credit and Commerce International SA[221] Browne-Wilkinson V-C, dealing with an examination under section 236 of the English Insolvency Act 1986, stated the following:

"[T]he reason for the inquisitorial jurisdiction contained in s. 236 is that a liquidator or administrator comes into the company with no previous knowledge and frequently finds that the company's records are missing or defective. The purpose of s. 236 is to enable him to get sufficient information to reconstitute the state of knowledge that the company should possess." (emphasis added.)

 

As explained by Buckley J in Re Rolls Razor, Ltd the position under section 236 of the Insolvency Act 1986 is broadly the same as that under section 268 of the Companies Act:

"The powers conferred by s. 268 are powers directed to enabling the court to help a liquidator to discover the truth of the circumstances connected with the affairs of the company, information of trading, dealings, and so forth, in order that the liquidator may be able, as effectively as possible and, I think, with as little expense as possible ... to complete his function as liquidator, to put the affairs of the company in order and to carry out the liquidation in all its various aspects, including, of course, the getting in of any assets of the company available in the liquidation. It is, therefore, appropriate for the liquidator, when he thinks that he may be under a duty to try to recover something from some officer or employee of a company, or some other person who is, in some way, concerned with the company's affairs, to be able to discover, with as little expense as possible and with as much ease as possible, the facts surrounding any such possible claim."[222]

This passage was subsequently approved by the Court of Appeal.[223] In Re Rolls Razor Ltd (No. 2) Megarry J said the following:

"The process under s. 268 is needed because of the difficultly in which the liquidator in an insolvent company is necessarily placed. He usually comes as a stranger to the affairs of a company which has sunk to its financial doom. In that process, it may well be that some of those concerned in the management of the company, and others as well, have been guilty of some misconduct or impropriety which is of relevance to the liquidation. Even those who are wholly innocent of any wrongdoing may have motives for concealing what was done. In any case, there are almost certain to be many transactions which are difficult to discover or to understand merely from the books and papers of the company. Accordingly, the legislature has provided this extraordinary process so as to enable the requisite information to be obtained. The examinees are not in any ordinary sense witnesses, and the ordinary standards of procedure do not apply. There is here an extraordinary and secret mode of obtaining information necessary for the proper conduct of the winding-up. The process, borrowed from the law of bankruptcy, can only be described as being sui generis."[224]

 

In British and Commonwealth Holdings plc v. Spicer and Oppenheim Lord Slynn, speaking for the House of Lords, approved the passages from Rolls Razor and Rolls Razor (2) quoted above and then said the following:

"I am therefore of the opinion that the power of the Court to make an order under s. 236 is not limited to documents which can be said to be needed 'to reconstitute the state of the company's knowledge' even if that may be one of the purposes most clearly justifying the making of an order."[225]

 

(iii)       The application of section 33(1) of the Constitution

[125]       In applying section 33(1) I propose adopting the approach followed in S v. Makwanyane and Another[226], where, as in the present case, the justification had to be necessary as well as reasonable and in which Chaskalson P formulated the approach as follows:

 

"The limitation of constitutional rights for a purpose that is reasonable and necessary in a democratic society involves the weighing up of competing values, and ultimately an assessment based on proportionality. This is implicit in the provisions of section 33(1). The fact that different rights have different implications for democracy, and in the case of our Constitution, for 'an open and democratic society based on freedom and equality', means that there is no absolute standard which can be laid down for determining reasonableness and necessity. Principles can be established, but the application of those principles to particular circumstances can only be done on a case by case basis. This is inherent in the requirement of proportionality, which calls for the balancing of different interests. In the balancing process, the relevant considerations will include the nature of the right that is limited, and its importance to an open and democratic society based on freedom and equality; the purpose for which the right is limited and the importance of that purpose to such a society; the extent of the limitation, its efficacy, and particularly where the limitation has to be necessary, whether the desired ends could reasonably be achieved through other means less damaging to the right in question. In the process regard must be had to the provisions of section 33(1), and the underlying values of the Constitution, bearing in mind that, as a Canadian Judge has said, 'the role of the Court is not to second-guess the wisdom of policy choices made by legislators'."[227] (footnotes omitted)

 

[126]       Because of the statutory duties which liquidators have to discharge in the winding-up of companies and the serious difficulties they face in recapturing the knowledge of the company prior to liquidation, in determining the cause of the company's failure and in establishing what assets (including claims) the company has, it is clearly reasonable (in the sense of there being a rational connection between mischief and remedy) to compel persons to be interrogated in relation to affairs of the company which are relevant to the discharge by liquidators of their duties, even where the testimony given tends to incriminate the person giving it. It is also necessary, in the sense that there is a pressing or compelling state interest to ensure that assets (including claims) of the company are recovered, for the benefit of creditors, especially from directors and officers of the company who may have been responsible, even criminally so, for the failure of the company. It is also necessary, in this sense, to compel persons to answer all relevant questions put to them even when the answers might incriminate them, for without this compulsion there would be a great reluctance by such persons to make a full and frank disclosure of their knowledge of the affairs of the company and their dealings with it.

 

 

[127]       The real question is whether it is necessary in the sense that no other method exists which achieves the desired objective, but which is less intrusive of the examinee's section 11(1) rights. Differently stated, is there an acceptable proportionality between the legitimate objective sought to be achieved and the means chosen? The answer must clearly be in the negative. The state interest in achieving full information must be just as compelling in the United States of America, Canada and the United Kingdom. Yet these countries, more consistently the United States and Canada, have achieved this objective by means which are less invasive of the examinee's rights, namely by conferring on the examinee either a direct or both a direct and a derivative use immunity in respect of self-incriminating evidence given at the enquiry. There is nothing to suggest that in South Africa the objective cannot be fully achieved if some form of use immunity were to be appended to section 417(2)(b) of the Companies Act. Section 65(2A)(b) of the Insolvency Act provides for direct use immunity in respect of enquiries held under that Act and, while there may be legitimate reasons for distinguishing between enquiries held in respect of personal bankruptcies and those relating to company liquidations, I can think of no proper justification for providing direct use immunity in respect of the former but not the latter. In the light of the aforegoing it is unnecessary to consider whether the essential content of the section 11(1) right has, within the meaning of section 33(1)(b), been negated by this provision. The conclusion is therefore reached that, as currently formulated, the provisions of section 417(2)(b) of the Companies Act, which infringe the examinee's section 11(1) rights, cannot be justified under section 33(1) of the Constitution. These provisions are accordingly found to be inconsistent with the section 11(1) right to freedom.

 

 

The attacks based on sections 8, 10, 13, 15, 22 or 24 of the Constitution

[128]       In view of the above finding it is unnecessary to consider whether the provisions of section 417(2)(b) of the Companies Act are inconsistent with any of the rights protected in sections 8, 10, 13, 15, 22 or 24 of the Constitution.

 

The extent of the inconsistency of the provisions of section 417(2)(b) of the Companies Act with the section 11(1) right to freedom

[129]       Section 98(5) of the Constitution provides that:

"In the event of the Constitutional Court finding that any law or any provision thereof is inconsistent with this Constitution, it shall declare such law or provision invalid to the extent of its inconsistency: Provided that the Constitutional Court may, in the interests of justice and good government, require Parliament or any other competent authority, within a period specified by the Court, to correct the defect in the law or provision, which shall then remain in force pending correction or the expiry of the period so specified."

 

The above subsection enjoins this Court, on finding that any law or any provision thereof is inconsistent with this Constitution, to declare such law or provision invalid "to the extent of its inconsistency." This raises two issues, one of severability and the other of judicial policy. We were urged on behalf of the applicants to strike down section 417(2)(b) in its entirety, leaving it to Parliament to decide whether to re-instate the obligation to give self-incriminating evidence, but coupled this time with a suitable indemnity against prosecution or a suitable use immunity (whether a direct or a direct and derivative use immunity). On behalf of the applicants we were urged not to express our own views as to what an appropriate and constitutionally valid use immunity would be, under the guise of a section 98(5) declaration as to the extent of the inconsistency of section 417(2)(b) with the Constitution. To do so would, it was submitted, be trespassing on Parliament's legislative sphere. On behalf of the second respondents in the Ferreira matter we were invited, in the alternative and in the event of finding section 417(2)(b) to be inconsistent with the Constitution, to make a qualified order in the following terms:

"To the extent only that the words 'and any answer given to any such question may thereafter be used in evidence against him' in section 417(of the Companies Act apply to the use of any such answer by an accused against him or her in criminal proceedings (other than proceedings for common law or statutory perjury in giving evidence under this section), the provisions are declared to be invalid."

 

[130]       On the issue of severability it is unnecessary on the issue before us to do more than apply the test which Kriegler J formulated for this Court in Coetzee v. Government of the Republic of South Africa and Others; Matiso and Others v. Commanding Officer, Port Elizabeth Prison and Others as follows:

"Although severability in the context of constitutional law may often require special treatment, in the present case the trite test can properly be applied: if the good is not dependent on the bad and can be separated from it, one gives effect to the good that remains after the separation if it still gives effect to the main objective of the statute. The test has two parts: first, is it possible to sever the invalid provisions and second, if so, is what remains giving effect to the purpose of the legislative scheme?"[228]

 

Both tests are satisfied in the present case, whether the order takes the form suggested by the applicants, or by second respondents in the Ferreira matter. On the applicants' approach the remainder of the legislative scheme in sections 417 and 418 is not dependent on the bad in section 417(2)(b). On the approach suggested by the second respondent in the Ferreira matter a person examined would still be obliged to answer all questions put, including those that might be self-incriminating, but the deletion of the words "and any answer given to any such questions may thereafter be used in evidence against him" would merely exclude the use of incriminating answers in all subsequent criminal proceedings against the examinee. The exclusion would be limited to criminal proceedings. Such a deletion would not have any effect on the efficacy of the section 417 and 418 proceedings; the removal of the bad would only affect subsequent use of the answers. On the second leg of the test, that which will remain clearly still gives effect to the purpose of the legislative scheme, which has been analysed above.

 

 

[131]       The more difficult problem relates to the way in which the Court should declare the extent of the inconsistency of section 417(2)(b) with the Constitution. There is great force in the warning that this Court ought not to prescribe or even suggest to Parliament how best it should legislate in order to address any statutory vacuum or deficiency caused by a declaration of invalidity. By doing this we might be seen to be trespassing on Parliament's legislative terrain. At the same time, however, the injunction in section 98(5) of the Constitution requires the Court to indicate the "extent" of the inconsistency. This qualification was not essential. The injunction could merely have read "it shall declare such law or provision invalid." The Constitution therefore reflects a choice for a narrow striking down. In certain cases such a narrow striking down is technically and linguistically simple where the constitutional inconsistency is encapsulated in (and limited to) a discrete subsection or paragraph containing nothing but the inconsistent provision. However, the excision cannot always be so surgically neat. The Constitution seems to have foreseen this by using the expression "to the extent of its inconsistency" as a qualification to the bald declaration of invalidity of "any law or any provision thereof." It permits the Court greater latitude in formulating its declaration of invalidity.

 

 

[132]       A not inconsiderable part of the argument was directed to the nature of (a) an indemnity against prosecution, or (b) a direct use immunity or (c) a derivative use immunity which, if coupled with the compulsion to give self-incriminating evidence, might render such compulsion constitutionally unobjectionable. This debate was an important feature in the judgments in Thomson's case.[229] It is not inconceivable (in fact it seems likely) that, if we were simply to strike down section 417(2)(b) in its entirety, Parliament would consider introducing more limited provisions along the lines of the  provisions of section 65(2A) of the Insolvency Act. In so doing, Parliament might decide to provide for a direct use immunity only, which might very well give rise to another constitutional challenge, resulting in another suspension of the section 417 and 418 procedures, the halting of liquidation enquiries and a hearing in this Court simply duplicating the arguments that have been addressed to us in the present case. Such a course of events would be both unnecessary and unfortunate, particularly if it could legitimately be avoided. It can properly, in my view, be avoided. It would be permissible for us, in the process of determining the extent of the inconsistency of section 417(2)(b) with the Constitution, to decide whether, in the South African context, both a direct and a derivative use immunity is necessary to save such a provision from being unconstitutional, or whether a direct use immunity would suffice. Without doing so, it would be difficult, if not impossible to indicate accurately the extent of the inconsistency. I now proceed to address myself to this question.

 

[133]       It has been pointed out above that, in the United States of America, both derivative and direct use immunity is necessary in order to escape constitutional challenge to a statute which limits the right against self-incrimination. In Thomson Newspapers La Forest J pointed out, however, that

"the absolutist position the courts in the United States have adopted in this area is undoubtedly rooted in the explicit and seemingly absolute right against self-incrimination found in the country's constitution"[230]

 

and that

 

"one should not automatically accept that s. 7 comprises a broad right against self-incrimination on an abstract level or, for that matter, on the American model, complete with all its residual doctrines. If that had been intended, it would have been very easy to say so."[231]

 

In embarking on this enquiry regarding derivative use immunity, it is salutary to bear in mind that the problem cannot be resolved in the abstract but must be confronted in the context of South African conditions and resources - political, social, economic and human.[232] The fact that a particular obligation may be placed on the criminal investigative and prosecutorial authorities in one country with vast resources, does not necessarily justify placing an identical burden on a country with significantly less resources. One appreciates the danger of relativising criminal justice, but it would also be dangerous not to contextualise it. The aphorism proclaims that it is better for ten guilty accused to go free than to have one innocent accused wrongly convicted. Does the same hold true if the proportion is stretched to a hundred to one or to a thousand to one? And must a system, which only produces one in a hundred wrong acquittals in one country, be maintained in another if it would consistently give rise to three in five wrong acquittals in the latter?

 

[134]       The distinction which La Forest J draws between the direct use of compelled testimony and the use of evidence derived from compelled testimony is, in my view, important:

(a)       In the case of the direct use of compelled testimony,

"[i]t is only when the testimony itself has to be relied on that the accused can be said to have been forced to actually create self-incriminatory evidence in his or her own trial. The compelled testimony is evidence that simply would not have existed independently of the exercise of the power to compel it; it is in this sense evidence that could have been obtained only from the accused."[233]

(b)       By contrast,

 

"evidence derived from compelled testimony is, by definition, evidence that existed independently of the compelled testimony ... Although such evidence may have gone undetected or unappreciated in the absence of the compelled clues ... [this] is not the same thing as non-existence ... [which in turn means] that it could have been found by some other means, however low the probability of such discovery may have been."[234]

 

[135]       This last mentioned feature means that the relevance, quality and weight of derivative evidence can be determined independently of the testimony of the accused and is therefore self-sufficient.[235] This distinguishing feature is significant. In Lam Chi-Ming v. R[236], an appeal to the Privy Council from Hong Kong, Lord Griffiths, in a passage quoted with approval by this Court in Zuma[237], identified three reasons for excluding confessions obtained by improper methods: (a) possible unreliability, (b) the privilege or principle against self-incrimination and (c) the desire to ensure proper behaviour by the police towards those in their custody and then added:

"the more recent English cases established that the rejection of an improperly obtained confession is not dependent only upon possible unreliability but also upon the principle that a man cannot be compelled to incriminate himself and upon the importance that attaches in a civilised society to proper behaviour by the police towards those in their custody."[238]

 

The policy considerations (a) and (c) above do not apply at all to the admission of derivative evidence. For this reason alone, it is legitimate to approach the admissibility of derivative evidence somewhat differently, the more so when regard is had to the independent existence of derivative evidence, quite apart form the testimony of the person disclosing it. In Thomson Newspapers, La Forest J, in dealing with the admissibility of derivative evidence, drew an analogy to section 24(2) Charter jurisprudence.[239] This subsection of the Charter has adopted an intermediate position with respect to the exclusion of evidence obtained in violation of the Charter. In R. v. Collins the Canadian Supreme Court explained that -

"[S. 24(2)] rejected the American rule excluding all evidence obtained in violation of the Bill of Rights and the common law rule that all relevant evidence was admissible regardless of the means by which it was obtained."[240]

Apart from the obvious statutory exceptions relating to confessions and admissions, the English common law rule is applied in South Africa.[241] No doubt this rule will have to be reconsidered at some stage in the light of the provisions of Chapter 3 of the present Constitution.

 

[136]       In Collins, evidence had been discovered on the accused in pursuance to a search which was in breach of the accused's rights under section 8 of the Charter. Lamer J, in the course of considering whether the admission of such evidence would bring the administration of justice into disrepute, stated the following:

 

"Real evidence that was obtained in a manner that violated the Charter will rarely operate unfairly for that reason alone. The real evidence existed irrespective of the violation of the Charter and its use does not render the trial unfair. However, the situation is very different with respect to cases where, after a violation of the Charter, the accused is conscripted against himself through a confession or other evidence emanating from him. The use of such evidence would render the trial unfair, for it did not exist prior to the violation and it strikes at one of the fundamental tenets of a fair trial, the right against self-incrimination."[242]

In Thomson Newspapers, La Forest J pointed out that Lamer J had not, in Collins:

"intended to draw a hard-and-fast line between real evidence obtained in breach of the Charter and all other types of evidence that could be so obtained. ... what Lamer J had in mind was the much broader distinction between evidence which the accused had been forced to create, and evidence which he or she has been forced to merely locate or identify. In other words, he had in mind the kind of distinction which I have attempted to draw between compelled testimony and evidence derived from compelled testimony."[243]

 

[137]       La Forest J also drew attention to the fact that

"... the testimony of third parties obtained as a result of the pursuit of such clue facts is clearly evidence that exists regardless of whether or not the person who provided the clue facts was compelled to give testimony. As much as the murder weapon or the stolen car, it is evidence that could have been found in the absence of any assistance, compelled or otherwise, from the person subsequently charged. I do not see why this factor should be relevant to the admissibility of the murder weapon under s. 24(2), but irrelevant to the admissibility of the third party's testimony under the same section, or to the admissibility of either piece of evidence under s. 7 or s. 11(d)."[244]

The learned Judge considered it

 

"overly broad to say that there must be an absolute prohibition against the use at trial of all evidence derived from testimony compelled before trial on the ground that the admission of such evidence can in some cases affect the fairness of the trial. ... [I]n defining the scope of the immunity required by the Charter, we are called upon to balance the individual's right against self-incrimination against the state's legitimate need for information about the commission of an offence."[245]

 

[138]       In outlining the advantages to the community as a whole (including the fact that investigation and detection is speeded up and the law's effectiveness as a deterrent enhanced) if there was not a blanket exclusion of derivative evidence, La Forest J made, to my mind, the important point, particularly for our context, that

"[t]he limited resources that society has to spend on law enforcement activity in general will be utilised in a more cost-effective manner ... [which will mean] the effective investigation of a greater proportion of offences ... [enhancing in turn] the law's potency as a deterrent to potential wrongdoers."[246]

He concluded that

"[a]ll of these benefits of a power to compel testimony would either be lost or severely limited if the Constitution required that the legislative grant of any such power must be accompanied by a grant of full use and derivative use immunity."[247]

 

[139]       The learned Judge adopted a flexible approach to balancing the interests of the individual and that of the state, which in his view could only be achieved by the trial judge exercising a discretion.[248] This discretion was, as La Forest formulated it in R. v. Corbett[249] and confirmed it in Thomson Newspapers,

 

"to exclude matters that may unduly prejudice, mislead or confuse the trier of fact, take up too much time, or that should otherwise be excluded on clear grounds of law or policy".[250]  

This discretion "is ultimately grounded in the trial judge's duty to ensure a fair trial."[251] A similar flexible approach could, La Forest J argued, be adopted in regard to the admissibility of derivative evidence, having due regard to the need to balance the right of the accused and that of the public in a specific context:

"... derivative evidence that could not have been found or appreciated except as a result of the compelled testimony under the Act should in the exercise of the trial judge's discretion be excluded since its admission would violate the principles of fundamental justice ... such exclusion should [not] take place if the evidence would otherwise have been found and its relevance understood ... The touchstone for the exercise of the discretion is the fairness of the trial process."[252]

La Forest J concluded by holding that:

"... complete immunity against such use is not required by the principles of fundamental justice. The immunity against use of actual testimony provided by s. 20(2) of the Act together with the judge's power to exclude derivative evidence where appropriate is all that is necessary to satisfy the requirement of the Charter."[253]

[140]       I respectfully favour the approach adopted by La Forest J, for the reasons stated by him, rather than that preferred by Wilson J.  Wilson J criticized La Forest J's approach on basically two grounds. Firstly because,

 

"[t]he public repute of justice is not the relevant consideration in determining whether derivative evidence should be excluded on the ground that it was obtained as a direct result of testimonial compulsion in violation of the principles of fundamental justice."[254]

I do not understand La Forest J to have advanced such a proposition so rigidly. The learned judge was arguing by way of analogy in an attempt (perfectly permissible in my view) to find an acceptable norm on the basis whereof the right of the individual could fairly be balanced against the interests of the state. This is encapsulated in the following observation the learned judge made:

"I find it difficult to imagine how the use of evidence which does not bring the administration of justice into disrepute can at the same time be contrary to the principles of fundamental justice. The consequence of the former finding is, in effect, to declare that the Charter breach by which evidence was obtained was non-prejudicial, and in a sense nominal. To argue that the same reasoning cannot be used to determine whether the use of derivative evidence constitutes a breach of the rights guaranteed under s. 7 would be to take an unduly formalistic approach to the interpretation of the Charter. As I mentioned earlier, the discussion might equally be framed in terms of the right to a fair trial under s. 11(d) with similar results, a matter to which I shall return."[255]

The second criticism was to the effect that

"[the] exclusion [of derivative evidence] must be a matter of principle and of right, not of discretion."[256]

If, as a result of the proper exercise of a discretion, a fair trial is ensured, I fail to see how principle is lacking, any more than when such evidence is admitted in a way which is "in accordance with the principles of fundamental justice", the qualification to section 7 of the Charter.

 

 

[141]       A recent decision in the Canadian Supreme Court, R.J.S. v. The Queen; Attorney-General et al., Interveners[257] (hereinafter "R.v.S. (R.J.)"), which bears on the issue of derivative use immunity as a constitutional requirement, came to our attention after argument. It concerned two young offenders who were both charged with the same offence of "break, enter, and theft" but, because of their age and by virtue of relevant Ontario legislation, were to be tried separately. At the trial of the one young offender ("the accused"), the other young offender ("the witness") was subpoenaed by the Crown to testify against the accused. On an application brought by the witness's counsel, the subpoena against him was quashed on the basis that to require the witness to testify would violate section 7 of the Canadian Charter of Rights and Freedoms. Because of the resultant lack of evidence the accused was acquitted. On appeal by the Crown, the quashing of the subpoena was set aside and a new trial ordered, a decision confirmed by the Supreme Court. It is necessary to point out the obvious, namely, that this particular problem could not arise in our law because of the transactional indemnity which, in similar circumstances, would be available to the witness by virtue of the provisions of section 204 of the Criminal Procedure Act.[258]

 

 

 

[142]       Nevertheless the decision is of significance for a number of reasons. First, it clearly affirms the principle that in all cases "a statutory compulsion to testify engages the liberty interest of s. 7" but that normally "the liberty interest is affected in accordance with the principles of fundamental justice."[259] Second, it confirms that a "deprivation of liberty may arise by virtue of a compulsion to speak per se ..."[260] regardless of the character of the compelled speech. The character of the speech which is compelled (for example, self-incriminatory speech) may, however, depending on the particular construction of the Charter, be determinative of the issue as to whether such deprivation of liberty is in accordance with the principles of fundamental justice or whether an infringement is justified under section 1 of the Charter.[261] Third, it makes clear that the liberty interest in section 7 of the Charter "may be engaged although there is no coincident deprivation in respect of the other s. 7 interests, life or security of the person".[262] Fourth, it holds, relying on earlier dicta, that not every restriction of absolute freedom constitutes a deprivation of liberty. Fifth, the judgment also confirms that, notwithstanding the provisions of sections 11(c)[263] and 13[264] of the Canadian Charter, section 7 of the Charter contains residual protections against self-incrimination extending beyond sections 11(c) and 13 and that this is necessary, in part, to protect the section 11(c) right.[265] Iacobucci J, highlighting "the vigour of section 7", held that there was "a functional, unifying principle" against self-incrimination and that pre-trial silence was no longer merely "a particular manifestation of the general freedom to do as one pleases" but had "been elevated to the status of a constitutional right."[266]  Lastly, it considers extensively the nature of derivative evidence and whether and to what extent a derivative use immunity is necessary in order to render compelled testimony in accordance with the principles of fundamental justice. I shall endeavour to deal as briefly as possible with this last aspect.

 

[143]       The issue of derivative use evidence was considered on the basis that the principle of fundamental justice which operated in the case was the "principle against self-incrimination".[267] It was pointed out that the Canada Evidence Act had abolished the witness's (as opposed to the accused's) privilege and replaced it with a limited form of immunity, applicable in respect of subsequent proceedings and not at the moment of compelled testimony, in as much as section 5(2) of the Canada Evidence Act currently provides that a witness's self-incriminatory answers cannot "be used or admissible in evidence against [the witness] in any criminal trial or other criminal proceeding against him thereafter taking place, other than a prosecution for perjury".[268] Iacobucci J describes the policy justification for the common law protections as resting "on the idea that the Crown must establish a 'case to meet'"[269] and reflecting "a basic distaste for self-conscription".[270]

 

 

[144]       The learned Judge's approach was to seek a compromise[271] between, on the one hand, full transactional immunity if self-incriminating testimony is compelled and, on the other, mere direct use immunity where it is only the witness's direct communication which is protected against subsequent use. In the course of his enquiry, Iacobucci J agreed[272] with the following statement by La Forest J in Thomson Newspapers:

"A right to prevent the subsequent use of compelled self-incriminating testimony protects the individual from being 'conscripted against himself' without simultaneously denying an investigator's access to relevant information. It strikes a just and proper balance between the interests of the individual and the state."[273]

The conclusion reached by Iacobucci J was that the Canadian Charter did not demand absolute derivative use immunity.[274] The learned judge approved[275] of the distinction drawn by La Forest J between compelled testimony and derivative evidence and stated succinctly that

"compelled testimony is evidence which has been created by the witness, whereas derivative evidence is evidence which has independent existence. It is only the class of created evidence which is, by definition, self-incriminatory."[276]

 

 

[145]       Of importance is the fact that Iacobucci J[277], like La Forest J in Thomson Newspapers[278], drew heavily, by way of analogy, on Canadian Charter section 24(2) jurisprudence in dealing with the question of the exclusion of derivative evidence. Nowhere in his judgment does Iacobucci J express disagreement with La Forest J in Thomson Newspapers; in fact it is written in terms of general approval with and further explication of La Forest J's judgment. Iacobucci J accordingly concludes that

"derivative evidence which could not have been obtained, or the significance of which could not have been appreciated, but for the testimony of a witness, ought generally to be excluded under s. 7 of the Charter in the interests of trial fairness."[279]

The qualification "ought generally" was introduced because the learned judge advocated[280] the same discretion on the part of the trial judge as is employed in the case of section 24(2) Charter exclusion, namely, that the exercise of the discretion "will depend on the probative effect of the evidence balanced against the prejudice caused to the accused by its admission."[281] In other words, there is no automatic rule of exclusion. Iacobucci J was, quite correctly in my view, hesitant to elaborate any further on the test and stated:

"Since this test for exclusion can only arise in the context of proceedings subsequent to a witness' testimony ... [i]ts form will become known, as it should, in the context of concrete factual situations."[282]

 

 

[146]       There is, in my judgment, no reason why this approach cannot and ought not to be adopted in regard to the enquiry concerning the admissibility of derivative evidence in the context of section 417(2)(b) of the Companies Act. I have little doubt that two different but related areas concerning the law of evidence will, in due course, have to be reconsidered fully in the light of Chapter 3 of the Constitution and section 25(3) in particular. The one relates to the way in which evidence, particularly in criminal proceedings, is obtained and the second to the question of when and to what extent a trial judge has a discretion to exclude otherwise admissible evidence.

 

[147]       Prior to the coming into operation of the Constitution, courts in South Africa were not particularly concerned with the way in which evidence was obtained. Notable exceptions of course related to admissions, confessions and, more recently, to acts of pointing out.[283] In other cases, however, the general approach was that, provided the evidence was relevant, it was admissible.[284] It is unnecessary in the present case to reconsider this issue beyond the very narrow area of the derivative use of compelled self-incriminating evidence. It can be noted, however, that since the Constitution came into effect, a new approach is beginning to emerge in decisions of the Supreme Court.[285]

 

 

[148]       As far as the discretion to exclude otherwise admissible evidence is concerned, there appears to be little doubt that similar fact evidence may be excluded if the probative value is outweighed by the prejudice it would cause.[286] The existence of a general discretion to exclude admissible evidence is, however, disputed. As Professor Zeffertt points out:

"There can be no more controversial an issue in the South African law of evidence than whether there is a judicial discretion, in criminal proceedings, to exclude admissible evidence. Some authorities say it exists; others deny it".[287]

 

Those in favour[288] of the existence of the general discretion to exclude admissible evidence usually rely on an obiter dictum of Rumpff CJ in S v. Mushimba[289], who referred to the English case of R v. Kuruma,[290] where it was stated that there could be no doubt that "the judge always has a discretion to disallow evidence if the strict rules of admissibility would operate unfairly against the accused";  but those opposed to the discretion point to the fact that the English rule referred to in Kuruma has been narrowly construed in subsequent cases[291] and has in England been affected by statute.[292] In South Africa most decisions of the Provincial and Local Divisions of the Supreme Court seem to confirm the existence of such a discretion, but the decisions are divided as to the basis for exercising the discretion.[293] Some of the decisions merely recognise that the rule relating to similar fact evidence applies in other situations as well, for example in criminal proceedings, where a judge has a general discretion to exclude evidence where its probative value is outweighed by its prejudicial effect.[294] Others appear to support the existence of a discretion, along the lines suggested by Lord Goddard in Kuruma's case, to exclude admissible evidence that would operate unfairly against the accused.[295] The more recent decisions, before the commencement of the Constitution, suggest that the discretion should be based on considerations of public policy, rather than fairness.[296]

 

[149]       In considering matters of evidential admissibility or inadmissibility we ought not to limit the focus of our attention exclusively on the state of the law of evidence which existed prior to the present Constitution coming into operation. Section 25(3) of the Constitution guarantees to every accused person the broad right to a fair trial, which is not limited to the specific enumerated rights in paragraphs (a) - (j) of the subsection. In certain areas of criminal procedure, the specific provisions of these paragraphs will settle debates concerning criminal procedure and criminal justice generally which previously were uncertain or controversial. Thus, the application of section 25(3)(e) of the Constitution in S v. Vermaas; S v. du Plessis[297] settled the

"lively controversy in our law [as to] whether persons standing trial on criminal charges who could not afford to pay for their legal representation were entitled to be provided with it at public expense once its lack amounted to a handicap so great that to try them on their own lay beyond the pale of justice."[298]

 

The general discretion to exclude evidence in a criminal trial is a principle accepted, for example, both in England and in Canada.[299] As La Forest J pointed out in Thomson Newspapers, the discretion to exclude evidence which would otherwise have been admissible, has been applied in various areas of criminal procedure because this discretion is "ultimately grounded in the trial judge's duty to ensure a fair trial."[300] La Forest J had no hesitation in concluding that this discretion ought also to be exercised in the determination of when, and when not, derivative evidence relating to compelled self-incriminating testimony should be admitted against an accused.[301] This approach, subject to its passing the test of section 33(1) of the Constitution, ought to apply in this country as well inasmuch as, just as in Canada, the right to a fair trial has been constitutionalised.[302]

 

[150]       In my view an approach whereby a blanket exclusion of derivative evidence is not applied but where instead it is dealt with on the flexible basis of discretionary admissibility, as outlined above, passes section 33(1) muster. We are not obliged to follow the absolutist United States approach which, as pointed out in Thomson Newspapers in a passage already referred to

"is undoubtedly rooted in the explicit and seemingly absolute right against self-incrimination found in that country's Constitution."[303]

 

The holding of a section 417 enquiry is lawful and serves an important public purpose. Evidence obtained as a result of such an enquiry cannot be equated with evidence obtained as a result of unlawful conduct. Where, for example, derivative evidence is obtained as a result of torture there might be compelling reasons of public policy for holding such evidence to be inadmissible even if it can be proved independently of the accused. Otherwise, the ends might be allowed to justify the means. The admission of evidence in such circumstances could easily bring the administration of justice into disrepute and undermine the sanctity of the constitutional right which has been trampled upon. The same considerations do not apply to derivative evidence obtained as a result of the application of section 417(2)(b) at a section 417 enquiry.

 

 

[151]       Companies are used to raise money from the public and to conduct business on the basis of limited liability. There are obvious advantages to doing so. But there are responsibilities which go with it. Part of the responsibility is to account to shareholders for the way in which the company conducts its affairs and, if the company goes insolvent, to account to shareholders and creditors for the failure of the business. These responsibilities are well known to all who participate in the running of public companies. Giving evidence at a section 417 enquiry is part of the responsibility to account. It cannot simply be said that the administration of justice would necessarily be brought into disrepute by the subsequent use, even in criminal proceedings against the examinee, of derivative evidence obtained as a result of the application of section 417(2)(b) of the Act. Indeed, the public, and especially the victims of the crime, might find a denial of the right to use such evidence inexplicable. Although it has been held that an auditor is not an officer of the company within the meaning of that expression in section 184(1) of the 1926 Act (corresponding to section 423(1) of the present Act)[304] and it has been suggested that there is no basis for regarding an auditor as being an officer of the company for any purpose of the Act,[305] in my view the same public policy considerations apply to the use of derivative evidence of an auditor of the company compelled to testify under section 417(2)(b) of the Act. The auditor has, inter alia, many statutory duties under the Companies Act[306] and the Public Accountants' and Auditors Act,[307] the