Community Scheme Ombud Services Bill: Further Deliberations

Human Settlements, Water and Sanitation

16 November 2010
Chairperson: Ms B Dambuza (ANC)
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Meeting Summary

The drafters took the Committee through Clauses 40 to 60 of the Community Scheme Ombud Services Bill (the Bill). In Clause 41, it was suggested that the 60 day time limit could be extended if warranted. It was clarified that Clause 42 was intended to allow the Service to reject applications not within its jurisdiction but to make recommendations for referral elsewhere. It was agreed that Clause 44 would also be amended and that both would make it clear that applications may be rejected if applicants did not respond. The drafters explained that the intention of the Bill was to make all proceedings as user-friendly as possible, which was why legal representation would not generally be allowed, but that Clause 43 would be amended by referring also to Clause 52, to clarify the instances in which it could be granted. The public’s concern why the applicant was limited, in Clause 44, to answering matters raised in the submission, was addressed by clarifying that context could be addressed but no new submissions could be raised. The difference between the functions of the ombud and the adjudicators was explained in relation to Clause 47. The Committee requested that reasonable timeframes be suggested by the drafters in relation to Clause 48.  Members asked for an assurance that applicants would have been made aware of the costs payable before launching their application, and this was addressed in Clause 49 and would be spelt out in regulations, and also clarified what the costs awards in Clause 53 could entail.  Members considered the wording of Clause 50 but agreed to retain the reference to “quickly”. The words “and/or” would be substituted for “and” in Clause 51. Members discussed whether it was appropriate for appeals to the high Court to be limited to questions of law, and discussed the public submission that perhaps a second opinion could be sought, or reviews commenced before referring to the High Court. It had been recommended that further sections be added to empower parties to take the ombud on review, and that time periods must be imposed for the orders. The drafters explained that if one party commenced the proceedings through the ombud, the other could not approach the High Court, and also explained that the ombud would not make decisions, and that there was already adequate provision in the law to take the decision of an administrative official on review, and the Bill specifically set out to stop delays in proceedings by those who could afford endless Court applications. Members noted, in respect of Clause 59, that the regulations must take into account that levies should be required in arrears, to avoid bodies corporate being placed under undue financial burdens.

Members would continue to discuss the Bill further in the first quarter of 2011, and hopefully the entity could be set up during 2011, and overseen by the Committee with effect from 2012.


Meeting report

 

Community Scheme Ombud Services Bill [B21-2010]: Further Deliberations
Mr Kwhezi Ngwenya, Director: Framework Legislation, Department of Human Settlements, outlined the clauses of the Bill to the Committee.

Clause 40
Members did not raise any issues on this clause.

Clause 41
Mr Ngwenya noted that an application for
an order declaring any decision of an association or an executive committee to be void, may not be made later than 60 days after such a decision had been taken.

Ms M Borman (ANC) noted that one of the public comments had suggested that the Committee should consider allowing later applications, provided that they were lodged within a reasonable time, rather than specifying a 60-day period.

Mr Ngwenya responded that there was a reason for imposing this time limit. If a decision could be challenged at any time after it had been made, the community associations would never be sure that it was acting on a finalised decision. The 60 day limit was imposed in an attempt to bring clarity.

The Chairperson said that in general Members were not adverse to the 60 days, but wondered if it would be possible to include a rider that if an adjudicator decided that the merits of the case warranted an extension of time, it could grant an extension.

Mr Ngwenya said that the Department could work on preparing alternative wording.

Clause 42
Ms Berenice Paulse, Parliamentary Researcher, noted that one submission from the public noted that there was no provision in the Bill stating that an applicant must provide the ombud with notice of an application, and suggesting that this should be stated.

Professor Graham Paddock, Consultant to Department of Human Settlements, said that there would not always be a request for that, so it was not a requirement in all cases. If, when investigating the matter, the ombud called for more information in terms of Clause 40, and this was not provided, then this Clause would come into play.

The Chairperson clarified that the public submissions had suggested that since the main aim of the Bill was to prevent expensive litigation, this clause should not to be utilised as an opportunity to institute legal proceedings, but should be used only after all other remedies had been exhausted.

Prof Paddock said the provision was necessary because it was possible that certain matters such as human rights abuses or spousal problems might be brought to the ombud when an applicant was not aware of what exactly the ombud was to do. If the basis of the complaint was something falling outside the jurisdiction of the ombud, for instance a personal rights or labour issue, then the ombud must be able to reject the application. The ombud had jurisdiction restricted to matters in connection with the running of the community scheme. The idea was that anything not within that jurisdiction could be taken off the table. This did not mean, however, that the ombud could not make a recommendation on where the matters should be referred.

The Chairperson said that the wording of “reject an application” was problematic.

Ms Borman agreed that perhaps there was a better way of putting this across.

Mr A Steyn (DA) added that Clause 44(b) also prescribed that if a person was asked to respond to the ombud within 14 days of a notice by the ombud, the ombud must “reject the application”. A person may not wish to respond, but this was effectively forcing confirmation.

Ms N Njobe (COPE) agreed with Mr Steyn, and suggested that the Committee should consider the wording of Clause 44 and then look again at Clause 42.

Mr Steyn said that that he would prefer that an automatic rejection should not happen, and suggested that perhaps the wording should be changed to “may reject an application”, to remove the onus to respond.

Prof Paddock agreed, and added that administrative delays and clogging could be problematic. It needed to be made clear whether applicants wished to pursue the matter, and the drafters would look again at the issues.

Mr Steyn said the drafters could consider inserting a provision that if no response from the applicant was received, the ombud should let the applicant know of the intention to reject.

The Chairperson agreed, and said that the Committee would need to be able to monitor the number of cases under way and completed.

Prof Paddock said this could be reworded so that notification would be given to the applicant before rejection.

Clause 43
Ms Paulse said that proceedings under this Clause should be easily accessible by the public, and should be kept as informal and user friendly as possible.

Prof Paddock referred to Clause 52, and said that there was an intention to keep things simple. There was no a right to legal representation, which again spoke to the need to simplify all procedures, unless everybody agreed that lawyers would be used, or if the adjudicator felt that one party was much stronger than the other, in which case legal assistance should be allowed. He wondered if a right to legal representation should be mentioned here. He thought that perhaps notice should be given to the parties that they were not expected to have legal representation.

The Chairperson asked if it was possible to simplify this further, and wondered if the issues could not be covered in the regulations. She understood what he had said, but stressed that this should be easily understood by everyone involved.

Prof Paddock said it was possible to take out some of the wording from this clause and put it in regulations.

Mr Steyn suggested that a possible alternative was simply to add the words “as contemplated in Section 52” to this clause.

Ms Pausle noted that later on, the Bill did provide for the proceedings to be available to the public.

Clause 44
Ms Njobe said she was not able to link how Clause 42 tied in with this clause, which required notice of any submissions to be given to the applicant.

Ms Paulse said, in respect of Clause 44(b), that one of the public submissions had questioned why the applicant was only to be given an opportunity here to respond to issues raised in the submission, and to set out the circumstances or context around those issues.

Prof Paddock responded that the limitation was not trying to prevent people from raising the context, but was trying to ensure that the applicant’s answer was related directly to the issues in the submission, and was not raising new issues, which would require a return to the beginning of the process.

Clauses 45 and 46
Members noted the content of these clauses but did not raise any comments.

Clause 47
Mr Steyn said he understood the wording of the clause, to the effect that the “ombud may contact the parties to the dispute and any of the affected persons with a view to facilitating a settlement of such disputes”, but wondered if this was really necessary, since the ombud was supposed to negotiate settlements, or make a ruling.

Prof Paddock responded that not every dispute was capable of mediation. The mediation process lay with the ombud and not the adjudicator. Mediation was a social process which involved gaining the confidence of the parties, but they could not be forced to agree to matters. Adjudication was more akin to a judgment on the issues that could not be agreed by the parties themselves. That was the reason for putting this wording here.

Clause 48
Ms Paulse noted that a public submission had been made on this clause, which dealt with the referral to the adjudicator. The submission suggested that there should be a set time frame in which he referral by the ombud must happen, to avoid backlogs or unreasonable delays, and also so that the applicants were aware of the timeframes.

Mr Ngwenya responded that the issues would have been set out by the applicant and respondent, and if new issues were allowed to come in, then the process would have to be extended. That was the rationale for the clause, which required the application, submissions and responses to be sent to the adjudicator.

Prof Paddock added that such applications should not be permitted to lie in a file, but must be dealt with as soon as possible. The parties or the ombud needed to identify the appropriate adjudicator for that particular dispute. However, he would not see any difficulty in adding the words “as soon as reasonably possible”.

The Chairperson said that timelines committed people to acting, and made them account if they were not met. She asked that the drafters should insert a specific reasonable timeline.

Prof Paddock asked if she had a suggestion for this timeframe.

The Chairperson responded that she was asking the drafters to suggest what might be a reasonable time, so that the Committee would be able to call people to account during its oversight.

Mr Steyn suggested that Clause 48(1) should commence with the words “If the ombud does not facilitate...”

Clause 49
The Chairperson noted that Clause 49 said that an adjudicator could not proceed to investigate an application until the prescribed adjudication fees had been paid or secured. She noted that some people may have obtained a waiver of fees and asked whether this clause should not make provision for that.

Prof Paddock said that if the fees were waived, then nothing would be “prescribed” or payable. He said the regulations would spell out how that would work, and the original application would also specify this.

Mr Steyn said that he was concerned that although the Bill had attempted to facilitate cheaper procedures for dealing with disputes, it seemed that many applicants might still not be able to afford these processes. As the costs of the ombud increased, so would the fees. He wondered if there was some way to make people aware of the costs prior to them lodging an application.

Prof Paddock agreed with this comment, and said it was necessary to make people aware of the costs of bringing an application. However, the application process itself forced people to consider if they were entitled to a discount or waiver. There was no danger that they would not know of the costs involved. This would be spelt out in the regulations.

The Chairperson said that she wanted to be sure this would be taken care of.

Clause 50
A Member referred to Clause 50(b), dealing with the duty of the adjudicator to investigate matters, and asked what this specific subclause meant.

Prof Paddock said that the reference to “as little formality and technicality as is consistent with a proper consideration of the application” was intended to distinguish this from an application through the normal court processes. One of the greatest criticisms of ordinary courts was that they operated under procedures and technicalities that were unfamiliar to most people. The ombud did not want to replicate a courtroom, but rather to keep costs down, to deal with matters speedily, and to do things more simply, but without forfeiting due process. Clause 50(b) referred to things being carried out without delay, but with consideration to the due process for considering the applications.

Ms Borman said that “act quickly” was weak, and wondered if “without undue delay” would be better.

Prof Paddock said that “without undue delay” implied that there would be some delay. The word “quickly” was clearer.

The Chairperson agreed with Prof Paddock.

Clause 51
Ms Paulse noted that a public submission had suggested that in Clause 51(1)(a)(ii), the word “and” should be linked also with the word “or”.

The Committee asked the drafters to effect this change.

Clause 52
The Chairperson noted that this clause was now allowing for legal representation in some cases, in contrast to what had been stated in Clause 43, and asked what the drafters were going to do.

Prof Paddock said that the drafters would include a reference to Clause 52 in Clause 43 as well.

Clause 53
Ms Paulse said that a public submission had suggested that the words “must make an order” in Clause 53(1) should be replaced with the word “may make an order”.

Members agreed that this should be done.

Ms Njobe wanted clarification on what the words “in considering the cost” meant, in Clause 53(2)(b).

Prof Paddock responded that this allowed the adjudicator to make an order that also took into account any previous applications made. In other words, if an applicant had brought a number of previous applications, which could amount to an abuse of the process, the adjudicator could take that factor into account when considering an award as to costs. The context therefore had to be considered.

Ms Njobe asked if the making of previous applications would advantage or disadvantage the applicant.

Prof Paddock said this was at the discretion of the adjudicator. If the applications were being made to harass someone, that could be taken into account.

The Chairperson said that this was why the word “may” was used. The adjudicator would be allowed to consider various issues, and communicate them. The respect of the consumers was important in this process. It was important for the government to ensure that the dignity of the people be restored.

Prof Paddock said that the next clause required that the decisions of the adjudicator must be justified, and questions of dignity would therefore be addressed.

Clause 54
Mr Ngwenya read out the clause, noting that it dealt with the orders and included a statement of the reasons for the order, together with time limits for compliance, and ancillary provisions. Members did not raise any comments or queries

Clause 55
Members did not need to raise comments on this clause.

Clause 56
Mr Steyn suggested that the second line of Clauses 56(1) and (2) should read  “must be enforced” instead of “may be enforced”.

Clause 57
Mr Steyn agreed that it was appropriate for an appeal to be made to the High Court on a question of law, but questioned why the clause was silent about issues that were not concerned with law, but fact.

Prof Paddock said this was intentional, and was worded this way to avoid the matter being pursued from one court to another by those who might be able to afford it. He noted that the reasoning was that the issue should be finalised to be able to move on.

Members agreed that this was desirable.

Ms Paulse commented that a public submission had commented that it was very expensive to resort to the High Court, and a possible alternative might be that the ombud could perhaps be requested to get a second opinion or request another adjudicator to review the matter before proceeding to a High Court appeal. There was also the question whether the jurisdiction of ordinary courts was excluded by this Bill, as it was implied that parties could appeal only to the High Court and only on a question of law. It was suggested in the public submissions that it was vital that the intention of the legislature be clarified, as the exclusion or non exclusion of court jurisdiction had serious implications. If the Bill did not exclude jurisdiction of any other court, then the issue of the prescription and the referral must be dealt with in the Bill.

She added that a further comment was made that in the interests of justice it was advisable that there be checks and balance in place in respect to the dispute resolution mechanism, such as review proceedings and appeals from the decisions of the ombud and adjudicator. Currently the Bill did not make any provision for review. It was suggested that this would constitute an infringement of the parties’ constitutionally guaranteed rights to a fair hearing. It was therefore recommended that a section should be inserted empowering parties to take the decision of the ombud on review, to reject the application, and / or that the decision of the adjudicator could be taken on review to the High Court. If so, it would then be necessary to impose a time limit within which the party must institute review proceedings, and it was suggested that a 30 day period be applied, which would be consistent with the time period applicable for appeal.

Ms Paulse said that a general comment was also made on procedural issues, suggesting that it would be in the interests of justice to impose a time period of a month or six weeks within which the ombud and / or adjudicator should inform the parties on their decision or make an order, and that the time should start running from the date when the ombud was provided with the information required, in terms of Section 44.

The Chairperson asked that the Committee should look at these issues.

Prof Paddock responded that the thinking behind the Bill was idea was that the ombud service would be set up to deal specifically with these types of disputes. The public submission was correct in that the parties could agreed to settle their dispute not through the ombud, but in the high Court. However, if one party to the dispute started an application through the ombud, then the other party had to comply with this procedure, and participate through the ombud.

Prof Paddock said that the Bill did provide for an appeal, and he had explained why this was limited to matters of law. The public submissions were now dealing not only with the review of the adjudicator’s award but also with review of the ombud’s decision. The ombud and deputy ombud were mostly concerned with case-management and did not in fact make “decisions”, because once a matter had been referred to an adjudicator they would not be further involved. The ombud was an independent office, and had to have the confidence of the public. There was already adequate provision in the law to commence review proceedings if an administrative official failed to do something properly. However, instituting reviews would allow people with money to delay proceedings, and that was not recommended.

Mr Mdakane agreed. It was important to be mindful of the reasons for the Bill. He said that the Committee y needed to ensure that fair treatment and justice was available for people in general. He agreed that once a decision had been made by an adjudicator, it should be regarded as the final decision, unless there were questions of law and whether the legal principles were correctly applied, in which case the appeal must be seen as the last resort. It was necessary to ensure that people respected the processes and procedures to avoid these matters becoming too expensive, and to prevent those with the funds to do so from dragging out the process for many years.

Clause 58
Members did not comment on this clause.

Clause 59
Mr Steyn asked what the intention was behind paying the levies to the Service, and whether the payments were intended to be paid monthly or annually.

Prof Paddock responded that if the levies were “prescribed”, and it was not yet certain whether this would be necessary, then the payment would be done annually. It was necessary also to look at the costs of collection and to consider how these could be reduced. Annual interaction between the schemes and the Service would be ideal, if there were levies.

Mr Steyn asked if the payment would be made annually in arrears or in advance. Body corporates collected levies monthly. If the levy was expected in advance, before body corporate levies had been collected, then this could place an undue financial burden on the body corporate. This should be considered in the regulations.

Clause 60
Members did not comment on the short title or commencement clause.

The Chairperson said the Committee would continue interacting with the State Law Advisers and Parliamentary Research Unit in the first quarter of 2011, and should hopefully be able to establish the Service in 2011, so that the Committee could begin to oversee it from 2012.

The meeting was adjourned.

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