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The Effect of Non-compliance with Section 34 of the Constitution on Courts’ Decision-making Powers

Section 34 of the Constitution: “Anyone has the right to have any dispute resolved by the application of law decided in a fair public hearing before a court or, where appropriate, another independent impartial tribunal or forum.”

In illustrating how non-compliance with section 34 of the Constitution may affect courts’ decision-making powers, the cases of K v K [2013] JOL 30037 (WCC) and Stopforth and Others v Royal Anthem Investments 129 (Pty) Ltd and Others will be discussed and compared. In this discussion, section 34 is referred to in the broad sense in that it also gives effect to the audi alteram partem rule.

In K v K, parties married in community of property got divorced. Both spouses were cited in the pleadings, but the wife’s pension fund was neither cited nor disclosed in that the wife was a member of such pension fund. Accordingly, the court a quo did not make a decision with respect to the wife’s pension fund benefits. The Supreme Court of Appeal (SCA) found that the pension should be divided in terms of section 7 of the Divorce Act 70 of 1979, despite not citing or mentioning the pension fund in the pleadings.

In terms of the contractual relationship between the wife and her pension fund, a maturity value would pay out to her at a certain time. In terms of section 7 of the Divorce Act, the same maturity value was to pay out in two halves to her and her ex-husband.

It is encouraged that pension fund benefits be pleaded specifically but even where a pension fund is not cited or referred to (as required by section 34 of the Constitution), a court will still order the pension fund to comply with section 7 of the Divorce Act. The most probable reason is because the decision does not expect of the pension fund to deviate from its initial contractual relationship with the spouse, but merely to pay the maturity value thereof to both ex-spouses in equal halves. 

In Stopforth, Swanepoel & Brewis Inc v Royal Anthem Investments 129 (Pty) Ltd, Yeun Fan Lau & Shun Cheng Liang (CCT63/14), a transfer attorney appealed to the court a quo’s decision that he be liable to pay interest on immovable property’s purchase price to the purchasers, such interest accruing after the sale of such property proved unsuccessful. The court a quo’s decision implicated the transfer attorney despite never having cited the transfer attorney as a party to the dispute. The SCA upheld the court a quo’s decision.

In terms of the Attorneys Act 53 of 1979, an attorney has a fiduciary relationship (contractual relationship) with a client. In this matter, the seller and the transfer had a fiduciary relationship. The court a quo and the SCA extended the fiduciary duty to also apply to the transfer attorney and the purchasers, also despite that the purchasers were not a client of the transfer attorney.

The Constitutional Court found that the extension of a fiduciary duty to apply to the transfer attorney and the purchasers was correct, but that both the court a quo and the SCA were incorrect for allowing procedural non-compliance with section 34 of the Constitution. Because the transfer attorney was not cited as a party to the initial dispute, section 34 was not complied with and therefore the transfer attorney could not be implicated by the court order. On closer analysis, non-compliance with section 34 was not allowed because it expected from the transfer attorney to pay interest which would not have been payable by him or her in terms of their initial fiduciary relationship with their client.

These two cases indicate that a court may, as long as the effect of its order is within the bounds of all the implicated parties’ underlying contractual relationship(s), decide to implicate a party that was not correctly cited or referred to in the papers. The legal logic behind the audi alteram partem rule, which is also given effect to in section 34, is not to allow prejudice to a party by not granting him or her the opportunity to state his or her case. The emphasis is on not to allow prejudice – the rule and the section do not apply without the necessary legal logic. 

The risks of an agreement that was copied and pasted: The whole agreement or non-variation clauseThe risks of an agreement that was copied and pasted: The whole agreement or non-variation clause

Many agreements, whether referring to lease agreements, employment agreements, agreements of purchase and sale, service level agreements or other types of agreements include boilerplate clauses. A boilerplate clause is a clause that