Relationship-centred lawyering and its impact on legal practice

by | Nov 8, 2025 | SLR, SLR V36 I1

Relationship-centred lawyering and its impact on legal practice

Author: Jonathan Campbell

ISSN: 1996-2193
Affiliations: BA LLB (UCT) LLM, Associate Professor, Faculty of Law, Rhodes University
Source: Stellenbosch Law Review, Volume 36 Issue 1, 2025, p. 61-78
https://doi.org/10.47348/SLR/2025/i1a4

 Abstract

This contribution emphasises the human factor in the relationship between lawyer and client. It submits that traditional “client-centred lawyering”, which foregrounds the paramount interests of the client, has considerable value but does not go far enough. “Relationship-centred lawyering” (or “relational lawyering”) extends the focus beyond the interests of the client to the relationship between lawyer and client. According to this approach the building of trust and rapport is foundational to a successful professional relationship.
Four key characteristics define relational lawyering: (i) the background contexts of both the client and the lawyer, and the personalities, values, preferences (and more) that each brings into the interactions between them; (ii) the importance of non-legal issues that can determine (in whole or in part) the strategy adopted and even the preferred outcome; (iii) a partnership between lawyer and client that allows for collaborative problem-solving, since the client knows best the facts of the case but also her needs and preferences, with the emphasis on the importance of client autonomy in decision-making; and (iv) a range of psychological matters, including interpersonal literacy, emotional intelligence and empathy in the lawyer-client relationship.
A range of skills and values are required to practice relational lawyering, known as “relational competencies”. These competencies are not widely practiced or understood by lawyers, and usually they are not explicitly included in law curricula. This contribution argues that there is a need for relational skills and values to be taught in law schools so that these valued competencies can aid graduates in serving the best interests of their clients in their future careers.

Perfecting entitlement before filing: patent revocation and the right to apply

by | Nov 8, 2025 | SLR, SLR V36 I1

Perfecting entitlement before filing: patent revocation and the right to apply

Author: Joel Morrison

ISSN: 1996-2193
Affiliations: LLB LLM, LLD Candidate, University of South Africa
Source: Stellenbosch Law Review, Volume 36 Issue 1, 2025, p. 79-92
https://doi.org/10.47348/SLR/2025/i1a5

 Abstract

This case comment examines the recent judgment in Regents of the University of California and Others v Eurolab (Pty) Ltd and Others. The dispute centred on the validity of a South African patent for a pharmaceutical compound marketed by the Regents of the University of California (“UC”) under the brand name Xtandi for certain forms of prostate cancer. Eurolab (Pty) Ltd launched a generic version of the same drug, Enzutrix, which Dis-Chem Pharmacies distributes. When UC pursued an interim interdict, Eurolab and Dis-Chem challenged the patent’s validity on two primary grounds: (1) the patentee’s lack of entitlement to apply for the patent under section 27 of the Patents Act 57 of 1978 and (2) alleged misrepresentations concerning priority. The Commissioner held that, where the applicant for a patent is not the inventor, that applicant must have acquired the right to apply from the inventor before filing. On the facts, certain co-inventors had pre-assigned their rights to a research institution, and no complete re-assignment was furnished to the patentee before the filing date. As a result, the patentee was not “a person entitled under section 27” at the critical date, rendering the patent invalid and liable to revocation. This judgment reinforces the strict requirement that the chain of title must be perfected before filing, underscoring the importance of complete and timely assignments for patent validity. It also clarifies that a post-filing agreement to assign cannot cure an applicant’s lack of initial entitlement. For prospective patent holders, the decision highlights the practical necessity of sound contractual arrangements with inventors (and any third-party research sponsors) before proceeding with a national or international patent filing.

Navigating the VAT Maze: Input Tax Deductibility for Holding Companies and Private Equity Structures in the Post-Woolworths Era

by | Oct 18, 2025 | BTCLQ, BTCLQ V16 I3

Navigating the VAT Maze: Input Tax Deductibility for Holding Companies and Private Equity Structures in the Post-Woolworths Era

Authors: Joon Chong and Des Kruger

ISSN: 2219-1585
Affiliations: Partner, Webber Wentzel; Consultant, Webber Wentzel
Source: Business Tax & Company Law Quarterly, Volume 16 Issue 3, 2025, p. 1 – 14

Abstract

This article provides a comprehensive analysis of the evolving legal landscape governing value-added tax (VAT) input tax deductibility for holding companies in South Africa, as well as for private equity structures. It examines the seminal judgments in Commissioner for the South African Revenue Service (CSARS) v De Beers Consolidated Mines Ltd, the recent landmark case of CSARS v Woolworths Holdings Limited, and the corroborating Tax Court decision in IT 76795. The analysis reveals a fundamental jurisprudential shift away from the restrictive, transaction-focused approach established in De Beers towards the holistic, purpose-driven framework solidified in Woolworths. This evolution presents both significant opportunities and new compliance imperatives for corporate structures, particularly within the private equity (PE) sector.
The central principle emerging from this body of case law is the critical importance for a holding company to defi ne, structure, and evidence its status as an ‘active investment holding company’. To successfully claim input VAT on acquisition, capital-raising, and other strategic expenses, a holding company must demonstrate that its core enterprise involves the continuous and regular provision of taxable supplies – such as management, financial, or administrative services – to its underlying portfolio companies for a fee. The mere passive holding of shares and receipt of dividends or interest is insufficient to constitute a VAT enterprise for the purposes of deducting input tax on associated costs.
The core thesis of this article is that the test for deductibility has evolved. The question is no longer whether an expense has a ‘direct and immediate link’ to a specific operational transaction, but rather whether it has a clear ‘functional link’ to the company’s overall, continuous enterprise. The Woolworths judgment has affirmed that costs incurred in furtherance of strategic expansion, such as capital-raising fees, are deductible if they serve to enhance and grow an active investment management enterprise.
For the PE industry specifically, this represents a pivotal moment. The strategic imperative is clear: PE holding companies must proactively structure their operations to align with the principles of the Woolworths judgment. This involves establishing formal management service agreements, charging market-related fees, and maintaining meticulous records that evidence active strategic involvement in portfolio companies. By doing so, they can create a defensible basis for claiming input VAT on a wide range of transaction costs, thereby mitigating tax leakage and enhancing overall fund returns.

The Conflict Between Director Reliance in the Companies Act and Director Liability in the JSE Listings Requirements

by | Oct 18, 2025 | BTCLQ, BTCLQ V16 I3

The Conflict Between Director Reliance in the Companies Act and Director Liability in the JSE Listings Requirements

Author: Siyabonga Nyezi

ISSN: 2219-1585
Affiliations: BCom (UCT), LLB (Unisa), Attorney of the High Court of South Africa
Source: Business Tax & Company Law Quarterly, Volume 16 Issue 3, 2025, p. 15 – 22

Abstract

In the film The Pursuit of Happyness, the protagonist, Chris Gardner, juggles the challenges of fatherhood on the one hand, with his failing attempts at an entrepreneurial breakthrough on the other. Throughout the film, each keeps getting in the way of the other, almost as if they cannot coexist. A missive on a film about a struggling entrepreneur and father is perhaps not the most conventional way to start an article on delegation and reliance in company law; but the purpose of the anecdote is to emphasise the concept of two attempts at doing the right thing getting in the way of each other – a central theme in this article’s analysis of the Financial Service Tribunal ruling in Munro v Johannesburg Stock Exchange (JSE2/2023) [2024] ZAFST 36. More specifically, this article examines the incongruence between the reliance provisions in section 76(5) of the Companies Act 71 of 2008, and the provisions relating to director liability in the JSE Listings Requirements (‘Listings Requirements’).
In Munro, the Financial Services Tribunal (‘Tribunal’) had to determine, inter alia, whether a (financial) director was liable to be sanctioned for a contravention of the Listings Requirements, resulting from misstatements in the company’s financial statements, where the director relied on information provided to him by other employees of the company. This article asserts that the provisions of the Companies Act and the Listings Requirements result in parallel and conflicting treatment of reliant director conduct. The article further argues that there are instances where the JSE Listings Requirements may unduly impose liability on directors who have, in line with section 76(5), relied on information provided to them by other employees.

Equity Equivalent Programmes: A Tax Analysis

by | Oct 18, 2025 | BTCLQ, BTCLQ V16 I3

Equity Equivalent Programmes: A Tax Analysis

Author: Michael Rudnicki

ISSN: 2219-1585
Affiliations: Tax Executive, Bowman’s Attorneys
Source: Business Tax & Company Law Quarterly, Volume 16 Issue 3, 2025, p. 23 – 29

Abstract

The concept of ‘Equity Equivalents’ in the context of BEE ownership rules and regulations is rearing its head once more. Foreign organisations seeking investable presence in South Africa are cautious about giving up true equity. Ownership points play a key role in the ‘BEE score card’ table. The Department of Trade, Industry and Competition has historically accepted an alternative basis to transfer equity to black owned small and medium organisations. The alternative is referred to as an ‘Equity Equivalent’ programme.
The programme typically envisages a percentage of turnover over a period of time (typically seven to ten years) to be deployed in qualifying beneficiaries or participants in categories of investment such as supplier development, training and research.
This article considers the tax deductibility of the EE expenditure in terms of section 11(a) of the Income Tax Act (’the Act’).
It is submitted that expenditure is ‘actually incurred’ not at the time of signing the framework agreement with the DTIC, but when the contractual obligation to pay beneficiaries arises.
The ‘in the production of income’ test focuses primarily on the act giving rise to expenditure. In the Warner Lambert case (see below for detail), the court concluded that expenditure incurred in respect of social responsibility obligations meets the ‘in the production of income’ test. It is submitted that BEE related expenditure incurred to retain and grow market share meets this test. So too, it is submitted, does expenditure incurred in respect of the EE programme meet this test. The purpose of concluding this programme is to maximise earnings covering existing and new markets.
The more sensitive issue in respect of EE related expenditure is the capital versus revenue nature of the expense. Generally, expenditure incurred in performing the income-earning operations of a business is revenue in nature. Expenditure incurred as part of the cost of establishing or enhancing or adding to the income-earning structure is capital in nature. Supplementary tests are the ‘once and for all test’ and the ‘enduring benefit’ test.
Warner Lambert, supra, considered the social responsibility expenditure in the context of capital and revenue. It concluded that the taxpayer’s income-earning structure had been erected long ago. The expenditure it incurred was to protect its earnings. Accordingly, the judgment concluded that the expenditure was revenue in nature. In the case of companies having erected their income-earning structure long ago, the EE related expenditure does not create an additional structure. Ownerships points are but one of the elements of the BEE scorecard. But the key feature of the expenditure is to maintain and improve market share, thereby protecting the entity’s earnings. As a result, it is submitted, such expenditure is not of a capital nature. The same conclusion should prevail, it is submitted, where a foreign organisation establishes presence in South Africa for the first time and seeks to maximise its market share. Using this income-earning structure to seek profitable business and as a result incur EE related expenditure, does not, it is submitted, label such expenditure capital in nature.