A comparative analysis of codes of corporate governance and their impact on the boards of public companies in Nigeria and South Africa

by | Dec 4, 2020 | JCLA, JCLA V7 I1 2020

A comparative analysis of codes of corporate governance and their impact on the boards of public companies in Nigeria and South Africa

Author Akin Olawale Oluwadayisi

ISSN: 2521-2605
Affiliations: BL ACIArb FIPMD LLM PhD and Notary Public, Lecturer, Department of Commercial Law, Faculty of Law, Adekunle Ajasin University, Akungba Akoko, Ondo State, Nigeria

Source: Journal of Comparative Law in Africa, Volume 7 Issue 1, p. 30 – 62

Abstract

The growth of the economy of any nation requires that public companies, which  dominate the securities sector, are strong financially, and also requires that the  modality for their governance and operations should accord with acceptable and  beneficial standards. Corporate regulatory bodies prescribe codes of corporate  governance (CCG) that regulate the daily activities and performance of corporate  entities. However, it appears that despite the introduction of CCG in Nigeria and  South Africa, public companies are yet to deliver the desired results, due to noncompliance,  enforcement challenges and a lack of internal mechanisms to implement  the spirit and content of CCG. This research provides a comparative analysis of  boards and the compliance level of public companies in Nigeria and South Africa.  The research methodology adopts a combination of doctrinal legal research and  qualitative analysis. The research aims to discover how the two countries can benefit  from each other. The objectives include determining the level of knowledge of CCG,  the level of accountability of boards, the level of responsibility, and enforcement and  compliance levels. The research identifies the gaps in the law and practice, while  offering solutions on how best to apply and enforce the codes in the two countries. 

A critical analysis of codification: Analysing the value of family preservation in African Law

by | Dec 4, 2020 | JCLA, JCLA V7 I1 2020

A critical analysis of codification: Analysing the value of family preservation in African Law

Author Gloria Paidamoyo Chikaonda

ISSN: 2521-2605
Affiliations: BA LLB LLM; PhD candidate and researcher, University of Cape Town

Source: Journal of Comparative Law in Africa, Volume 7 Issue 1, p. 63 – 92

Abstract

The laws and practices of African people have often been regarded as repugnant,  and in many cases have been completely ignored. During the colonial period,  African laws were denied. In this context the important questions surrounding the  preservation and development of a legal theory that is distinctly African arises. I will  argue that the codification of African customary law values is one way of ensuring  the survival of African law and, in furtherance of that aim, I will examine the  value of preserving the family. With reference to South African and Zimbabwean  legislation and jurisprudence and an overview of the Namibian approach to dealing  with the recognition of customary law, I propose that in place of the codification of  customary laws and practices, consolidating – in textual format – the underlying  values, such as the preservation of the family, will be an effective way of laying  the foundation for an African legal theory. This will preserve African law, while  maintaining the dynamism and fluidity of customs and practices. 

Contentious jurisdiction: The Kenyan Kadhis’ courts and their application of the Islamic law of custody and maintenance of wives and children

by | Dec 4, 2020 | JCLA, JCLA V7 I1 2020

Contentious jurisdiction: The Kenyan Kadhis’ courts and their application of the Islamic law of custody and maintenance of wives and children

Author Jamil Ddamulira Mujuzi

ISSN: 2521-2605
Affiliations: Professor of Law, Faculty of Law, University of the Western Cape, South Africa

Source: Journal of Comparative Law in Africa, Volume 7 Issue 1, p. 93 – 119

Abstract

Article 170(5) of the Constitution of Kenya provides that ‘[t]he jurisdiction of  a Kadhis’ court shall be limited to the determination of questions of Muslim law  relating to personal status, marriage, divorce or inheritance in proceedings in which  all the parties profess the Muslim religion and submit to the jurisdiction of the  Kadhi’s courts.’ A provision to the same effect is also included in s 5 of the Kadhis’  Courts Act. It is clear that the Kadhis’ Courts have jurisdiction over marriage,  divorce and inheritance and they have handed down many judgments dealing  with these issues. Neither art 170(5) of the Constitution nor s 5 of the Kadhis’  Courts Act expressly permit or prohibit these courts from dealing with custody  and maintenance matters. This approach is different from the one taken in other  African countries such as Tanzania (Zanzibar) and Uganda, where the issues of  custody and maintenance are expressly mentioned in the law on Kadhis’ Courts.  As a result, there are conflicting decisions from the Kenyan Kadhis’ Courts and  the High Court on the issue of whether the Kadhis’ Courts have jurisdiction  over custody and maintenance matters. In this article, I illustrate how the Kadhis’  Courts and the High Court have dealt with the issues of custody and maintenance  in Islamic law and I refer to Kenyan case law and the drafting history of art  170(5) to argue that the Kadhis’ Courts do not have jurisdiction over custody and  maintenance issues. I rely on legislation and practice from other African countries to  suggest ways in which the issue of the jurisdiction of the Kenyan Kadhis’ Courts  in relation to custody and maintenance could be addressed. 

Opinion: Will the African continental free trade area’s dispute settlement protocol be adequate to ensure compliance?

by | Dec 4, 2020 | JCLA, JCLA V7 I1 2020

Opinion: Will the African continental free trade area’s dispute settlement protocol be adequate to ensure compliance?

Author Yakubu Nagu

ISSN: 2521-2605
Affiliations: PhD candidate and researcher, Centre for Comparative Law in Africa, Faculty of Law, University of Cape Town

Source: Journal of Comparative Law in Africa, Volume 7 Issue 1, p. 120 – 134

Abstract

The success of any regional integration or development initiative depends on  actors within that initiative operating smoothly and with some degree of efficiency.  A dispute settlement framework guarantees efficiency by providing a means by  which friction between actors can be reduced. African integration initiatives always  provide for a framework for conflict management. The African Continental Free  Trade Area (‘AfCFTA’) initiative is no different as it provides a mechanism  by which disputes arising in the course of deepening integration under the free  trade initiative can be resolved. The agreement creating the AfCFTA includes a  Protocol on Rules and Procedures on the Settlement of Disputes. While the broad  importance of this protocol to the initiative cannot be over-emphasised, how the  dispute settlement system that it creates will function, as well as the potential of  its successful operation, appears to be riddled with ambiguity and shrouded in  doubt respectively. This is especially because the efficacy of other regional dispute  settlement systems in Africa has been undermined by myriad issues ranging from  technical inefficiencies to the absence of political will, often manifesting in outright  non-compliance. This article primarily appraises the AfCFTA’s Protocol on Rules  and Procedures on the Settlement of Disputes and comments on the adequacy of  certain provisions. 

A discussion of the requirements of a trial of a serious question of consequence and the best interests of the company as contemplated in section 165(5)(b) of the Companies Act 71 of 2008

by | Nov 28, 2020 | JCCL, JCCL V6 I1

A discussion of the requirements of a trial of a serious question of consequence and the best interests of the company as contemplated in section 165(5)(b) of the Companies Act 71 of 2008

Authors Darren Subramanien

ISSN: 2521-2575
Affiliations: Lecturer School of Law (PMB), University of KwaZulu Natal
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 1, 2020, p. 1 – 23

Abstract

The requirements for judicial discretion to grant leave for a derivative  action are located in s 165(5)(b) of the Companies Act 71 of 2008. The  discretion of the court must be exercised to prevent time-consuming  and costly actions that are deemed to be frivolous, vexatious or  without merit. In terms of s 165(5)(b) the court must be satisfied that  the applicant is acting in good faith, that the proceedings involve the  trial of a serious question of material consequence to the company,  and that it is in the best interests of the company that the applicant  be granted leave. It would therefore be open to the courts to provide  an interpretation of the words in s 165(5)(b) regarding the good faith  requirement, to find that the proceedings involve a serious question  of material consequence to the company, and to find that it is in the  best interests of the company that the applicant be granted leave.  This article discusses the requirements of ‘a trial of a serious question  of consequence’ and the ‘best interests of the company’ in s 165(5)(b)  of the Act. The interpretation of these words and phrases in s 165(5)(b)  will ultimately determine the success or failure of the new statutory  derivative action as an adequate remedy for aggrieved applicants  who seek redress on the company’s behalf if the company or those in  control of it improperly fail or refuse to do so. This article will refer  to the relevant sections in the law of the United Kingdom to provide further clarity about the interpretation of the relevant provisions in  s 165(5)(b) of the Companies Act 71 of 2008. 

Board autonomy and recourse to the courts in south africa

by | Nov 28, 2020 | JCCL, JCCL V6 I1

Board autonomy and recourse to the courts in south africa

Authors Genevieve Paige Wagener

ISSN: 2521-2575
Affiliations: Attorney of the High Court of South Africa
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 1, 2020, p. 24 – 39

Abstract

In the aftermath of the recent comments made by the chairperson  of the Old Mutual Ltd board that the board cannot be dictated to by  the court on matters of corporate governance, it must be clarified  that the Constitution still grants anyone the right to have a legal  dispute settled by a court or other independent and impartial forum  or tribunal if the legal dispute is justiciable and if the party has legal  standing in relation to such dispute. 

Possible manipulation of the ‘solvency and liquidity’ test under the Companies Act makes the test an ineffective alternative to the ‘maintenance of capital’ principle

by | Nov 28, 2020 | JCCL, JCCL V6 I1

Possible manipulation of the ‘solvency and liquidity’ test under the Companies Act makes the test an ineffective alternative to the ‘maintenance of capital’ principle

Authors Joshua Sasha Kadish

ISSN: 2521-2575
Affiliations: Attorney at Fluxmans Inc
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 1, 2020, p. 40– 53

Abstract

This article argues that although great strides have been made with the  abolition of the maintenance of capital principle and its replacement  by the solvency and liquidity test, the possible manipulation of the  latter test raises questions about whether it is an adequate alternative  to the maintenance of capital principle. 

The continued relevance of the Turquand Rule under the current company law regime in South Africa

by | Nov 28, 2020 | JCCL, JCCL V6 I1

The continued relevance of the Turquand Rule under the current company law regime in South Africa

Authors Jacquiline Mujulizi

ISSN: 2521-2575
Affiliations: Advocate of the High Court of Tanzania
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 1, 2020, p. 54 – 65

Abstract

The statutory enactment of the Turquand rule in s 20(7) of the  Companies Act 71 of 2008 raises questions about the continued  relevance of the common-law Turquand rule in South African law. As  the common-law rule addresses aspects of the accepted presumption  that can, legitimately, be made by third parties on the company’s  compliance with procedural or administrative requirements, its  continued relevance and application can hardly be questioned, as  argued in this article. 

Good corporate governance affirms the board (led by the chairperson) as the focal point of governance and the courts have no mandate to undermine this principle

by | Nov 27, 2020 | JCCL, JCCL V6 I1

Good corporate governance affirms the board (led by the chairperson) as the focal point of governance and the courts have no mandate to undermine this principle

Authors Tsepiso Mofokeng

ISSN: 2521-2575
Affiliations: Executive Chairman, Mofisto Investments (Pty) Ltd
Source: Journal of Corporate and Commercial Law & Practice, Volume 6 Issue 1, 2020, p. 66 – 79

Abstract

Corporate governance has long been endorsed globally as a key  factor in the survival or success of every corporation. The failure  of international companies like Arthur Anderson and Enron serves  to reinforce the argument that the courts have a role to play in  circumstances where the board has failed to carry out its functions.  This will be argued by referring to the importance of the prescribed  legislation and the King Codes, and more specifically, King IV as a  watchdog of good governance, often cited in court decisions where  governance is in issue. Reference will also be made to relevant case  law to emphasise the role of the courts in this regard. 

Befriending the bogeyman: Direct horizontal application in AB v Pridwin

by | Nov 27, 2020 | SALJ, SALJ V137 I4 2020

Befriending the bogeyman: Direct horizontal application in AB v Pridwin

Author Meghan Finn

ISSN: 1996-2177
Affiliations: Lecturer in Public Law, University of Johannesburg
Source: South African Law Journal, Volume 137 Issue 4, p. 591-607

Abstract

In AB v Pridwin Preparatory School 2020 (5) SA 327 (CC), the Constitutional  Court held (in four judgments) that independent schools are subject to constitutional  scrutiny and bear duties to the learners enrolled in them. For this reason, the court  declared invalid a school’s decision to terminate a contract without affording any  opportunity to make representations. By rejecting the idea that the independent  schooling sector is insulated from constitutional duties, the Constitutional Court’s  judgment achieves a vital outcome. However, while the court’s outcome is welcome,  its reasoning rests on shaky foundations. The court’s majority, which favoured direct  horizontal application, inadvertently perpetuates the idea that there are parallel  systems of law. Further, the court has a great appetite for making sweeping legal  pronouncements, and then purportedly limiting their precedential effects by claiming  that judgments turn on context-specific inquiries. This cuts against the court’s stated  commitment that horizontal application must progressively transform the law.