Judge Dennis Davis on Constitution Seventeenth Amendment Bill & Superior Courts Bill

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Justice and Correctional Services

11 September 2012
Chairperson: Mr L Landers (ANC)
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Meeting Summary

The Portfolio Committee on Justice and Constitutional Development heard input from the Judge President of the Competition Appal Court, Judge Dennis Davis, on the Constitution Seventeenth Amendment Bill [B6-2011] and Superior Courts Bill [B7-2011]. Judge Davis said that the thrust of his proposal was a constitutional amendment which would state that ‘where an Act of Parliament so provides another court other than the Supreme Court of Appeal could be the highest court for the subject matter of that court’. In other words the Constitutional Court would always remain the highest court in the land. The exception for the Constitutional Court was that it took on more and more diverse matters using the principle of in the interest of justice. A further reason that was out forward for the proposed amendment was that there were too many layers of appeal which rendered litigation to be costly, time consuming and frustrating for investors and complainants alike. It was pointed out to the Committee that the Competition Appeal Court and Competition Tribunal had the requisite expertise on the subject matter of competition law and both had developed a rich jurisprudence in comparison to the Supreme Court of Appeal. Judge Davis said that the argument and proposal he had set out for the Competition Appeal Court also applied equally to the Labour Appeal Court. Judge Davis reiterated that his fundamental premise was that the country had too many levels of appeal. Access to justice was at war with the broad structures of the current judicial system. One could not expect people to go through three or four structures if there was a need for there to be access to justice since recourses were scarce.

Members of the Committee raised concerns over the proposed amendment. The first was that if the proposed amendment was accepted as it was then other areas of the law such as family law; environmental law etc would also request to exclude the jurisdiction of the Supreme Court of Appeal. It was suggested that in order to cure the effect of multiple layers either the Competition Appeal Court could sit as a panel of the Supreme Court of Appeal or the threshold for leave to appeal could be lifted even higher. A Member made the point that competition matters on appeal came from a tribunal whilst labour matters on appeal came from a court and that this was a significant difference. The point was also made that in terms of time constraints the Supreme Court of Appeal had the ability to deal with matters quickly as observed with the speed at which they dealt with the sexual offences case.

Some Members of the Committee were sympathetic to the argument made by Judge Davis especially in relation to the issue of a multiple layered appeal system however they pointed out that the Constitution should not be amended every time there was a problem and a constitutional amendment would require support from the majority of political parties in Parliament. The Committee also referred to concerns raised in some financial journals on the move of the competition authorities from the Department of Trade and Industry to The Department of Economic Development as well as backroom negotiations between ministries and competition officials that might have occurred in certain cases.

Meeting report

The Chairperson welcomed the Judge President of the Competition Appeal Court and handed over to him.

Proposal by Judge Dennis Davis on Constitution Seventeenth Amendment Bill & Superior Courts Bill
Judge Dennis Davis, Judge President (JP) of the Competition Appeal Court (CAC), said that he would talk about the Labour Appeal Court (LAC) and the CAC. The thrust of the proposal for the CAC was a constitutional amendment which would state that ‘where an Act of Parliament so provides another court other than the Supreme Court of Appeal (SCA) could be the highest court for the subject matter of that court’. In other words the Constitutional Court would always remain the highest court in the land. The question that arised was whether the SCA would be the intermediate arbiter of matters in relation to labour and competition law. The history of the Competition Act was that there would be a specialist body called the Competition Tribunal (CT) in which three members sat. Appeals from this body would then go to the CAC which had three sitting judges except in interlocutory matters where only one judge sat. If there was a jurisdictional dispute then the SCA and or CC could be approached. For any competition matter the buck stopped with the CAC except for the CC which had ultimate jurisdiction. The reason for this was that in the area of competition law discharging matters expeditiously was important for example a merger had to happen as quickly as possible otherwise the parties would walk away and this would have a massive effect on investments. The jurisprudence in competition law was very complicated and one wanted to ensure that matters were dealt with using requisite expertise in the areas of law and economics. The idea was for there to be a specialist court.

The Competition Act was drafted with careful consideration and a lot of expertise went into it. In Ansack and Botash the point was raised that in Section 167(5) of the Constitution the SCA was the supreme court in all matters except constitutional ones. The matter went to the SCA which held the correct decision and as a result of this it took a decade for the matter to be resolved. The oversight was genuine. The Superior Courts Bill sought to correct this oversight and deem that the CAC was the final arbiter save for the CC. The reason why the CAC would not be the final court was because the CC took matters now which were in the interest of justice and often this was stretched because of the very wide ambit of the Constitution. Judges from Australia and England were horrified at the lavish way in which litigation took place in SA. Appeals tended to continue on an ongoing basis, there were currently four layers e.g. the Tribunal, CAC, SCA and CC. In a country of SA’s resources this was crazy. One could say that the courts were also at fault because they gave leave to appeal too easily. What this also did was that it resulted in re-distribution of wealth to the legal profession.

If one wanted to ensure that a merger did not happen in SA then the easiest way to do this was to ensure that there was a plethora of appeals through the various courts. Nobody would want to invest in such a country where there were so many layers of appeal. The people that were most affected by these matters were poor people. What would be the advantage of having the SCA; it could not be that they had a lot of expertise with respect. The CAC conducted a lot of training for judges in an area of law that was such a novelty for SA. The current system would be intolerable to the small litigants as well as investors. The Act had a fine design and it was unfortunate that it was being subverted in this matter. The system was unwieldy, costly and made no sense. If the CAC was cut out then an expert court would have been sucked out of the system and the SCA would not be geared to handle the cases because the CAC heard urgent cases on an urgent basis. The Committee should uphold the proposed amendment. Everything that had been said about the CAC also applied to the LAC and more so because this was a court unlike the CT. The whole labour system was designed for matters to be discharged expeditiously but this was not happening. One may argue that the CT was not a court however it had built up a lot of expertise and the quality of its jurisprudence did not differ markedly from the CAC’s cases.

Discussion
Mr S Swart (ACDP) said that other judges argued the contrary. If the proposed amendment remained as it was then other areas of the law such as family law, environmental law etc would also request to exclude the jurisdiction of the SCA. The revenue authorities would also request to have similar legislation on the basis of expediting tax matters which had a massive effect on the country. What were Judge Davis’ views on whether the leave to appeal from the SCA should not be higher? What about the possibility of the CAC and LAB not sitting as a panel of the SCA? The financial journals had commented that there was a massive political shift since competition matters now fell under Economic Development as opposed to the previous position when they were under the Department of Trade and Industry (DTI), how had this impacted on the work of the CAC?

Ms D Schäfer (DA) said that the SCA developed a narrow test as to what cases it would take on appeal, it did not just take any cases. Competition matters on appeal came from a tribunal whilst labour matters on appeal came from a court, this was a significant difference. Where would the line be drawn if the Constitution was amended so as to provide for other courts to be courts of final instance except for the CC? The SCA had the ability to deal with matters quickly as observed with the speed at which it had dealt with the sexual offences case.

Ms M Smuts (DA) said that the proposed amendment was an attempt to render constitutional what was unconstitutional. The problem was that the Constitution should not be changed at a whim. What if the Committee ended up not expanding the jurisdiction of the CC as proposed in the Bill however Judge Davis had confirmed that the CC already took on cases that it wanted to take on the basis of what was in the interest of justice. There was sympathy for the point made by Judge Davis. The Chief Justice (CJ) had raised the concern that the Tribunal was not staffed by judges. It was true that there were too many levels of appeal.

Judge Davis said that his fundamental premise was that the country had too many levels of appeal. Access to justice was at war with the broad structures of the current judicial system. One could not expect people to go through three or four structures if there was a need for there to be access to justice since recourses were scarce. In all honesty the SCA was no longer the highest court in the land. It was true that the CC was meant to only deal with matters of a constitutional kind, the reality however was that the constitution had a wide scope and it dealt with matters relating to public and private power. As time went on the CC would take the concept of its in the interest of justice, infuse it with constitutional values and then deal with a whole range of issues. The CC was the highest court in the land and increasingly for all law as well. There was no easy solution to this matter. Having the CAC sitting as a panel would not solve anything as there would still be an extra level; the only difference would be that there would be three judges as opposed to three. The layers would be Tribunal, panel of SCA and then CC.  In tax matters for example a matter either goes to the full bench unusually or straight to the SCA and it ends there. Very rarely if ever would substantive issues on tax law or family law would ever end up at the CC. It could be specified that the proposed amendment would only apply in those matters where a specialised court was necessary. One was sympathetic to the concerns raised by the SCA judges however in meetings with heads of court the JP of the SCA has never objected to the proposal that the CAC should be where it was.

Judge Davis continued to say that if at least one tier was to be cut out then it should be the SCA as it did not have the requisite expertise. In terms of recent jurisprudence, the special leave that Ms Schäfer mentioned was now just normal leave. The special leave threshold was that leave to appeal was not just given because of the view that there was a reasonable prospect of success. One would have to ask if there was a special importance to the parties. If this high threshold was required, the CC was likely to here the case anyway; this meant that there would be a further level of appeal. The jurisprudence of the Tribunal compared very favourably with that of a single judge. What was the difference between a tribunal and a single high court judge, some might argue that a tribunal was more susceptible to making a mistake than a high court judge; such a statement was highly contestable. If this was true would there really be a need for an additional layer of a court that had no expertise on competition law and no understanding of economics. At the moment on the bench there was a paucity of commercial judges, the reason for this was obviously that apartheid created this dreadful racist situation whereby commercial cases only went to white people. Black lawyers never got briefs, so when one wanted to appoint even experienced practitioners that were black or women for that matter very few had years of commercial experience. This would change over the next decade no doubt. It was true that the Constitution should not be changed every time something went wrong however in this case this was a genuine mistake.

Judge Davis continued to state that his premise allowed for expedition and some level of clarity. One should not be hung up on this idea that the SCA would not be what it was; fact of the matter was that the SCA was really not the court that it used to be. 

Mr J Jeffery (ANC) said that he was amongst the converted, the difficulty was that if there was to be a constitutional amendment then there would have to be agreement amongst the majority of not all of the political parties. The Committee was toying with the idea of not amending the jurisdiction of the CC on the basis that there was jurisprudence that had already developed there. In terms of the argument raised by Judge Davis this would not matter because the CC already heard what it wanted to anyway. There was this concern that many ministers would have authority to set up courts, so the Committee was thinking of providing that only the Minister of Justice would have the authority to introduce legislation affecting the courts. This would be on the basis that there was going to be a single judiciary under the CJ; hopefully this would allay some of the other Member’s concerns that there would be a floodgate as only the Minister of Justice could introduce legislation affecting the courts. Could Judge Davis shed more light on other countries and how they dealt with competition matters and also could statistics be provided  on the number of appeals to the SCA and how many were granted as well as the number of judgments from the CAC that were overturned by the SCA.

Judge Davis said that the Competition Act never envisaged cutting out the SCA, the SCA would still have jurisdiction over whether the CAC had jurisdiction within the Act. The CAC would only have jurisdiction within the ambit of its own Act. The SCA did hear the sexual offences Act and the odd matter however it was not going to hear a case with a 10 000 page record in two weeks, that’s what the CAC dealt with. One of the massive advantage of having judges with the necessary expertise was that they knew what to look for. A hotly contested case from CAC found its way to the SCA via a petition. The court Registrar would provide the Committee with the requested statistical information. In terms of international trends, in Europe matters went from a commission to a panel at the European Court of Justice (ECJ), so there were two layers. In many other countries one only got a review to the high courts and no appeals. In America there were many judges on their bench who came from the antitrust bar. Once again there were only two opportunities. Very rarely did the United States (US) Supreme Court take on these cases.

Ms Schäfer asked if it was feasible to specify in the Constitution that the jurisdiction of the SCA may be limited by Acts of Parliament where specialist knowledge was required.

Judge Davis said that this was a perfectly legitimate proposal.

Mr Jeffery said that it would not just be specialist courts, there would have to be further criteria such as urgency so as to avoid the floodgates being opened.

Judge Davis said that in the next 10years one would find that the jurisdiction of the CC would have overwhelmed that of the SCA. Judges would be looking more and more to the CC’s jurisprudence as the ultimate arbiter for almost all critical issues in this country.

Mr Swart asked for a comment on procedural fairness, it seemed that the legal fraternity were of the opinion that the SCA’s judgments were vital to ‘scupper attempts by the competition authorities to abuse their powers when prosecuting offenders and force the competition commission to conduct more vigorous investigations to prevent the legal challenges’. Was the CAC doing enough to protect the procedural aspects?

Judge Davis said that one only had to read David Lewis’ book to see the extent to which we have come under flack for precisely doing that. There was an exquisite balance that had to be struck and a specialist court did that better than the SCA. The exquisite balance was that one wanted the competition authorities to do their job properly, cartels to be caught and dealt with summarily. One had to sensibly balance procedure with the rights of the Competition Commission. Unless one understood the economic harm of a case than often that balancing aspect was applied in a horribly wrong manner. The CAC had been criticised for erring too much on the side of a complainant, it was acceptable that the cartels had rights however the consumer community also had rights. If the CAC got it wrong one could always go to the CC.

Ms C Philane-Makaje (ANC) said that Judge Davis raised an important point when he referred to access to justice and this was something that the Committee would have to think very carefully about.  The issue of transformation had to happen as well as discussed extensively by the Committee.

Judge Davis said that procedural rights had to be protected and cartels also had rights. The present CJ has given an enormous commitment to ensure that there was access to justice. The CAC was the most transformed court in SA in terms of black judges as well as female judges.

Mr Swart said that there were journals indicating that there was a lot of backroom negotiations between competition authorities and the ministry. There was a lot of concern over the fact that the competition authorities have moved from DTI to Economic Development and what this meant for who was running the economic policy of the country. 

Judge Davis said that the CAC has not seen a lot of difference since the move from DTI to Economic Development. A lot of what Mr Swart was referring to came out of the Walmart case. The Commission had decided to approve the merger unconditionally. Minister Davis and his colleagues were concerned about the merger and they went off to the Tribunal and the court. The government was entitled to raise legitimate concerns as seen in the judgment. The Commission has been an independent body that has fiercely upheld the objectives of the Act. In every country in the world where huge stakes were involved, the captains of industry did go to the applicable authorities in order to try and strike a deal.

The Chairperson thanked Judge Davis on behalf of the Committee.

Meeting Adjourned.


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