South Africa: Land Claims Court

IN THE LAND CLAIMS COURT OF SOUTH AFRICA

CASE NUMBER: LCC64/2010

RANDBURG

Decided on 26/08/2011

In the matter between

DAVID DANIEL JACOBS N.O ….......................................................................................Applicant

and

THE GOVERNMENT OF THE REPUBLIC

OF SOUTH AFRICA …............................................................................................First Respondent

THE CHIEF LAND CLAIMS COMMISSIONER …........................................Second Respondent

THE COMMISSION ON THE RESTITUTION

OF LAND RIGHTS ….............................................................................................Third Respondent

THE DEPARTMENT OF RURAL DEVELOPMENT

AND LAND REFORM ….....................................................................................Fourth Respondent

THE LEGAL AID BOARD …..................................................................................Fifth Respondent

THE REGIONAL LAND CLAIMS COMMISSIONER

FOR THE NORTHERN CAPE …..........................................................................Sixth Respondent

JUDGMENT

____________________________________________________________________________

MPSHE AJ

A. INTRODUCTION

[1] This is an application seeking declaratory orders as well as reviewing and setting aside the decision of the second respondent the Chief land Claims Commissioner. The relevant relief sought is as follows:

1. The review and setting aside of the following decisions and/or actions:

1. the decision of the second respondent on the 6 October 2009 not to take steps to arrange legal representation at the expense of the third respondent in respect of the matter under case number LCC 120/099;

2. the failure of the second respondent to take a decision within a reasonable time or at all, to take steps to arrange legal representation at the expense of the third respondent in respect of the matter under case number LCC 3/98;

3. the failure of the second respondent to take a decision within a reasonable time or at all, to take steps to arrange legal representation at the expense of the third respondent in respect of the matter under case number LCC 120/99;

2. The following other relief:

1. Declaring that the applicant is entitled to the payment of legal expenses at the expense of the Land Claims Commission in the matter under LCC case numbers 3/98 and 120/99;

2. Directing that the third respondent be directed to provide legal representation for the applicant at its own expense in the matters under LCC case numbers 3/98 and 120/99;

3. Directing the first, second and/or third respondents to pay to the applicant’s attorney’s trust account the amounts set forth in annexures DDJ13, DDJ20, DDJ27 and DDJ33 to the applicant’s affidavit, alternatively that the first, second and/or third respondents be directed to secure the funds set forth in annexures DDJ13, DDJ20, DDJ27 and DDJ33 to the applicant’s affidavit, for the provision of legal representation to applicant at the expense of the Commission in the matters under LCC case numbers 3/98 and 120/99;

4. Directing the first, second and/or third respondents to pay to the applicant’s attorney’s trust account, interest on the amounts set forth in annexures DDJ13 and DDJ20 at the prescribed rate of 15.5% per annum from the date of each such invoice to the date of final payment;

5. Costs of suit against the second and third respondents, and such other respondent that opposes this matter, jointly and severally;

6. Further and/or alternative relief.

[2] Relief sough in prayers 2.1 and 2.2 is not opposed by the respondents. I will therefore not deal with these prayers in detail in this judgment.

[3] The Restitution of Land Rights Act 22 of 1994 (The Act) provides as follows at section 29(4):

“Where a party can not afford to pay for legal representation itself, the Chief land Claims Commissioner may take steps to arrange legal representation for such party, either through the State legal aid system, or, if necessary, at the expense of the Commission”

[4] The inclusion of this section as supra, in my opinion was intended to protect the Constitutional rights of the indigent people. It was to ensure a fair trial to litigants.

The desirability of legal representation at state expense has received attention by our courts. The apposite decision in this regard is the Nkuzi Development Association vs Government of The Republic of South Africa & Another¹.

The Nkuzi decision deals with the provisions of Extension of Security of Tenure Act 62 of 1997 and Land Reform (Labour Tenants) Act 3 of 1996. However, I find the judgment to be of general application pertaining to legal representation at state expense. Other cases are Legal Aid Board v Pretorius & Another² and Legal Aid Board v S³.

B. BACKGROUND

[5] In and during 1998 and 1999 the Regional Land Claims Commissioner referred the applicant’s land claims arising out of the dispossession of erf 38 Upington and the farm Uap to this court for adjudication.

[6] After ruling on points in limine in 2000, in respect of both erf 38, as well as the farm Uap, and after a long delay, the then second respondent, agreed to provide funds on 20 March 2007 in terms of section 29(4) of the Restitution Act.

[7] The trial in respect of erf 38 Upington commenced in January 2009, and continued in March 2009 only in respect of the merits of the claim for erf 38 Upington, with quantum to stand over for later determination. The legal expenses were paid until the end of March 2009.

[8] The matter continued in May 2010 and the applicant’s legal team and experts continued to render services.

[9] Although the matter was concluded in May 2010 and judgment granted in favour of the applicants in August 2010, the legal fees and disbursements in the amount of R 700 281.98 for the last days of evidence and argument, including preparation of heads of final argument, needed to be paid.

[10] I have already indicated supra that prayers 2.1 and 2.2 are not opposed. What remains to be determined is the relief sought in prayers 2.3 and 2.4. Prayer 2.3 is about payment of monies to the applicant. These are made up of professional fees to the amount R 700 281.98 as per Annexure DDJ13 to the founding affidavit and an amount of R 10,000 – 00 as professional fees for services rendered by Martin Legassick of Legassick Consultants as per Annexure DDJ20 to the founding affidavit.

[11] The attitude of the second respondent can be gleaned from paragraphs 20 and 27 of the answering affidavit:

“20 AD PARAGRAPH 38 THEREOF:

The first respondent did not authorize the expenditure incurred in respect of the invoice annexure “DDJ13”. As a result thereof it cannot be compelled to pay such invoice.

27. AD PARAGRAPH 9 THEREOF:

It is clear from the allegations made in this paragraph that the amounts as set out in annexure “DDJ13”, “DDJ20”, “DDJ27” and “DDJ33” were not approved. The applicant’s legal representatives were informed prior to such expenditure that there were no more funds available. There is no explanation why they went ahead despite the fact that they were informed that funds were not available and incurred such expenditure.”

[12] It is clear that the dispute is around payment of the sum of R710 281.98. The second respondent’s attitude is that payment cannot ensue because the said amount claimed was not authorized.

[13] It is not in dispute that applicant was granted an amount of R 184 000.00 for a special plea and “R517 100.00 for trial in the erf 38 Upington claim if junior counsel was briefed and R 607 100.00 if Senior Counsel was briefed”.

It is further not in dispute that applicant used all the monies so allocated and accumulated a debt of R 710 281.98 outside the authorized amounts. It is this amount applicant is now claiming in order to pay for professional services rendered.

[14] It is important to deal with the happenings inter-partes after the authorized amounts had been spent.

On the 1 July 2009 applicant sent an account to second respondent for payment.

On 1 September 2009 second respondent replied as follows:

“The funds that were allocated for this matter have been exhausted; in fact we have paid R 410 695.39 over and above the budget that you requested. We are therefore unable to make payment for your invoice number 845 for an amount of R 727 426.06 and R 10 000.00 for an expert, until they have been approved by the Chief Land Claims Commissioner.

Kindly provide an explanation for the above expenditure and a motivation for payment which will be forwarded to the Chief Land Claims Commissioner”.

Applicant duly responded and provided the requested motivation on the 10 September 2009.

[15] The second respondent gave an indication that the account was being considered. This much is clear from e-mail dated 06 October 2009. Hereafter, despite telephonic enquiries by the applicant, silence ensued from second respondent. This application was then launched on 23 March 2010. I need to mention that correspondence on these accounts started back in 2008.

[16] On 5 December 2008 applicant sent an email to respondents confirming undertaking to settle the one account in the amount of R 10 000.00. I have to quote the letter in its entirety as follows:

“Dear Mr Peter

I refer to your conversations today with Advocate Krige and my bookkeeper Caron.

I wish to confirm that you have advised them both that payment of the outstanding fee of R 10 000.00 due to Professor Legassick has been authorised and that payment will be made in respect of that outstanding fee. I further confirm that, owing to internal difficulties, the only outstanding aspect is the timing of the payment.

Thank you for you assistance in resolving this matter. Please will you keep me posted on your progress in processing the payment, as we are requiring Professor Legassick to travel to Upington with us for the trial of this matter in January, and I do not regard it as fair to expect him to spend considerable more time and effort on this matter whilst his fees for past work have still not been settled. I therefore will appreciate if this payment can be prioritized.”

The contents of this e-mail were never responded to nor disputed in any manner.

[17] On the 10 June 2009 Thami Mdlalose, the Director: Legal Support directed an email to one Isaac Peter of third respondent directing payment of R 10 000.00 to applicant. The salient part thereof reads:

“Please see to it that payment is captured and submitted to finance.”

[18] Despite the directive by Thami Mdlalose to pay, applicant made further enquiries on the 21 August 2009 two months down the line. In response thereto Thami Mdlalose sent email dated 22 August 2009 as follows:

Caron

A report has been forwarded to the head of the office for a decision on the matter.

We will revert as soon as he has signed the necessary memo.

Apologies for the delay.

All this is in respect of R 10 000.00 as per DDJ20.

[19] Almost one month after service of Notice of Motion papers on the respondents a letter dated 7 May 2010 was dispatched to the applicant from the office of second respondent. I deem it necessary to quote this letter in its entirety.

“Dear Sir

RE: OUTSTANDING ACCOUNTS DD JACOBS MATTER

We refer to the above as well as your statement dated 22 September 2009. As from the 1^st of April 2010 the Commission took a decision to make payment for legal representation provided to their client from a budget controlled and managed at the office of the Regional Land Claims Commissioner with jurisdiction to the claim. (My underlining)

Your outstanding invoice has been referred to Regional Land Claims Commission for Free State and Northern Cape. It is anticipated that the RLCC shall have received all documentation by the 11^th of May 2010. Mr Victor Mathumba a Deputy Director for legal support in that office, contactable at 051 403 0700 shall assume responsibility for all your payments. (My underlining)

The decision of the Commission follows the unavailability of funds to make payment from the budget of the Chief Land Claims Commissioner, as a result of the reduction of the overall Commission budget.

We apologise for the delay in processing your payment.

Yours Faithfully

Ms N Mboniswa

Director: Legal Support

Date: 7/8/10

[20] The import of this letter is clearly that second respondent finally agreed that the outstanding amount sought by applicant be paid.

I read nowhere in this letter that the claim is being disputed. Instead the letter makes it clear that non-payment was as a result of “unavailability of funds to make payment from the budget of the Chief Land Claims Commissioner”.

[21] I am called upon by the applicant to rule that the respondents took a decision that was irrational and capricious. That the decision has to be set aside. I am not keen to deal with this issue of rationality or otherwise. The rational for this is because respondents took no decision not to pay outstanding amount but rather used their discretion not to pay on the basis of lack of authorization to pay. However, I am of the opinion that whether it be called discretion or decision, the fact of the matter is that payment was not authorized in the 2009/2010 budget.

[22] Is the discretion reasonable?

Applicant submitted request for payment of the outstanding amounts. A motivation was called for by respondents and this was duly done. Perusal of the said motivation demonstrates that the money spent was unavoidable. I say unavoidable as the expenditure was incurred in the running of the trial in both matters.

[23] I do not find anywhere an allegation by respondents that the expenditure was unnecessary or fruitless for that matter.

[24] The refusal to pay outstanding amounts claimed implies that the legal representation was not necessary. This, in my mind is tantamount to denying the applicant fundamental constitutional rights as per section 25(7) and 34 of the Constitution.

[25] I now turn to the payment of interest at the legal rate of 15.5% on the outstanding amounts.

[26] An enquiry as to whether the amounts were due and payable at time of submission of invoices is unavoidable. It is trite that interest at legal rate is payable from the period the amounts became due and payable.

In his minority judgment in the matter of Singh v Commissioner, South Africa Revenue Service 2003 (4) SA 520 (SCA), Olivier JA investigated the meaning of the words “due”and“payable”.⁴

Quoting Galgut AJA in The Master v I L Back and Co Ltd and Others 1983 (1) SA 986 (A) at 1004 G, Olivier AJA states that the ordinary meaning of “due” is that:-

“… there must be a liquidated money obligation presently claimable by the creditor for which an action could presently be brought against the debtor. Stated another way, the debt must be one in respect of which the debtor is under an obligation to pay immediately.”⁵

[27] In casu it cannot be said that the amounts were due and payable at time of submission of invoices. Respondents’ attitude is and had always being that applicant has overspent. Thus there was no obligation on respondents to pay. I find no rational whatsoever to order payment of interest “from date of each such invoice to date of final payment.

C. COSTS

[28] Counsel for the respondents Mr. Notshe argued that applicant be granted partial costs. The rational being that applicant has succeeded in as far as prayers 2.1 and 2.2 are concerned. This I believe is on the apprehension that applicant may not succeed on the remaining prayers.

[29] Applicant has succeeded on the relief sought save the prayer on interest as per prayer 2.4 to the Notice of Motion. I am however, of the opinion that prayer 2.4 is a relief sought in the event of success on the application. This prayer can therefore not be said to be part of the substance of the application.

[30] I am further of the opinion that disapproval has to be shown by this court for the manner in which respondents handled this matter causing applicants to launch this application. It is clear that applicant does not have money to pay for legal fees.

[31] I therefore order that costs should follow the event.

D. ORDER

I consequently make the following order:

(a) Applicant is entitled to the payment of legal expenses at the expense of the Land Claims Commission in the matters under LCC 3/98 and LCC 120/99;

2. Third respondent is directed to provide for legal representation in favour of the applicant at its own expense in the matters LCC 3/98 and LCC 120/99, until finalization thereof;

2. Second and /or third respondents to pay into the account of applicant’s attorney the amount of R 700 281.98 and R 10 000.00 ;

2. Interest at the rate of 15.5% from date of this order to date of payment; and

2. Second and/or third respondents to pay costs of this application the one paying the other to be absolved.

______________

J.M MPSHE

ACTING JUDGE

APPEARANCES

Adv Krige on behalf of the Applicant instructed by Chennells Albertyn Attorneys, Notaries & Conveyancers

Adv Notshe on behalf of the Respondent instructed by State Attorney Kimberley