South Africa’s NINA debtor plight: Lessons from the Scottish consumer debt relief system post the Covid-19 pandemic

by | Jan 28, 2024 | SAMLJ, SAMLJ V35 I1

South Africa’s NINA debtor plight: Lessons from the Scottish consumer debt relief system post the Covid-19 pandemic

Authors: Shammah Boterere & André Boraine

ISSN: 1996-2185
Affiliations: Postdoctoral Fellow, Faculty of Law, University of Pretoria; Professor, Department of Mercantile Law, University of Pretoria
Source: South African Mercantile Law Journal, Volume 35 Issue 1, 2023, p. 27 – 48
https://doi.org/10.47348/SAMLJ/v35/i1a2

Abstract

In this article, the authors consider the plight of the so-called No Income No Asset (NINA) debtors against the backdrop of debt relief measures provided for this category of debtors who find themselves in a debt trap. It is a well-known fact that South African insolvency law does not provide sufficient debt relief measures for all types of debts, and those, like the NINA debtors, who are effectively excluded from the relief afforded by the sequestration and ultimately rehabilitation procedures of the Insolvency Act 24 of 1936 have no proper statutory measure to provide a discharge of debt in instances where they may desperately need it. It is submitted that the debt restructuring mechanisms provided by the administration procedure and debt review measure, are not sufficient since these do not offer a discharge. Reference is made to the newly proposed debt intervention procedure that may provide some relief in this regard, but it is argued that the legislature needs to consider further procedures to deal with their plight. With the view of making some recommendations for reform, aspects of mainly the Scottish system of debt relief measures are also considered.

The impact of regulatory pluralism and complexity on the governance of state-owned companies in South Africa

by | Jan 28, 2024 | SAMLJ, SAMLJ V35 I1

The impact of regulatory pluralism and complexity on the governance of state-owned companies in South Africa

Author: Tebello Thabane

ISSN: 1996-2185
Affiliations: Senior Lecturer, Commercial Law Department, University of Cape Town
Source: South African Mercantile Law Journal, Volume 35 Issue 1, 2023, p. 49 – 73
https://doi.org/10.47348/SAMLJ/v35/i1a3

Abstract

This article outlines and critiques the regulatory universe applicable to state-owned companies (SOCs) in South Africa. It argues that the governance of SOCs occurs within a plural regulatory universe characterised by an intricate system of norms, principles, and practices that are engendered, monitored, and enforced by state and non-state actors. The article further argues that the complexity of the regulatory universe is one of the main causes of weak governance in SOCs. This argument is premised on the realisation that a coherent, predictable, efficient, and accessible regulatory universe enables compliance and sound corporate governance. In evaluating the regulatory universe, this article follows two lines of inquiry: the first is a doctrinal and principled approach, and the second is an instrumental, policy orientated, and forward-looking analysis. The article concludes that the regulatory universe of SOCs is not only plural and complex but also incoherent and fragmented, resulting in onerous over-regulation, regulatory quandary, and uncertainty, which collectively negatively impact the quality of governance.

The unfortunate dearth of judicial precedent in transfer pricing continues

by | Jan 28, 2024 | SAMLJ, SAMLJ V35 I1

The unfortunate dearth of judicial precedent in transfer pricing continues

Author: Thabo Legwaila

ISSN: 1996-2185
Affiliations: Professor, School of Law, University of the Witwatersrand
Source: South African Mercantile Law Journal, Volume 35 Issue 1, 2023, p. 74 – 93
https://doi.org/10.47348/SAMLJ/v35/i1a4

Abstract

Despite what could be hailed as the first two transfer pricing cases in South Africa, the unfortunate dearth of judicial precedent in South Africa regrettably continues. Transfer pricing is one of the most complex areas of tax alongside provisions dealing with controlled foreign companies, foreign exchange gains and losses, currency conversions, financial instruments, and corporate reorganisations. In fact, as the list goes on, it is just more apposite to say ‘tax is complex’, period. With regard to transfer pricing in particular, the complexity is amplified by the fact that transfer pricing is not even tax per se. It is an economic allocation of contribution through the value chain. It is through transfer pricing that each contributor in the value chain gets an adequate return for their contribution in the value chain. Once that allocation is complete, the tax provisions are applied to the returns of each contributor according to the tax laws of the countries in which they are taxable. A transfer price is a price set by a taxpayer when selling to, buying from or sharing resources with a related person. A transfer price is contrasted with a market price, which is the price set in the marketplace for the transfer of goods and services between unrelated persons where each party strives to get the utmost possible benefit from the transaction (see Arnold & McIntyre, International Tax Primer (Kluwer Law International 2002) 55; Danzinger, International Income Tax (Butterworths 1991) 303–307). Transfer prices are not negotiated in a free open market and as such have the propensity to deviate from prices agreed upon by non-related trading partners in comparable transactions under the same circumstances (Oguttu, International Tax Law: Offshore Tax Avoidance in South Africa (Juta 2015) 213). Unless prevented from doing so, related persons engaged in cross-border transactions can avoid the income taxes of a country through a manipulation of prices, mainly by shifting profits to low tax countries and expenses to high tax countries. To combat this, tax authorities across the globe have the power to adjust, in appropriate cases, the transfer prices set by related persons (Arnold & McIntyre, (Kluwer 2002) 55. In what can be welcomed as the first transfer pricing case in the South African courts, the South Johannesburg High Court had an opportunity to decide on the applicability of s 31(7) of the Income Tax Act 58 of 1962 (‘the Act’; any reference to a section or subsection are to the Act, unless otherwise stated, or the context indicates otherwise) to a debt owed by a foreign company to a South African company. The applicable provision excludes debt instruments that contain core characteristics of debt instruments from the application of transfer pricing provisions. In the second case, the same court missed out on an opportunity to gauge the legitimacy of the revenue collector to use s 31(2) of the Act to adjust prices charged between a taxpayer and third parties that are not related to the taxpayer.

Do taxpayers have to pay tax when SARS has not complied with sections 92, 95 and 96 of the Tax Administration Act? Nondabula v Commissioner: SARS & another explained

by | Jan 28, 2024 | SAMLJ, SAMLJ V35 I1

Do taxpayers have to pay tax when SARS has not complied with sections 92, 95 and 96 of the Tax Administration Act? Nondabula v Commissioner: SARS & another explained

Author: Moseki Maleka

ISSN: 1996-2185
Affiliations: Senior Lecturer, Department of Mercantile Law, University of South Africa
Source: South African Mercantile Law Journal, Volume 35 Issue 1, 2023, p. 94 – 109
https://doi.org/10.47348/SAMLJ/v35/i1a5

Abstract

Section 3 of the South African Revenue Service Act 34 of 1997 (‘SARS Act’) provides that the South African Revenue Service (‘SARS’) is empowered to administer and collect taxes in South Africa. The Commissioner for SARS (‘the Commissioner’) is empowered to invoke the collection methods in terms of ss 164 and 179 of the Tax Administration Act 28 of 2011 (‘the TAA’).

Retraction of a ‘hot-headed resignation’ caused by depression: Lessons from Cairncross/Legal and Tax (Pty) Ltd 2019 (2) BALR 137 (CCMA)

by | Jan 28, 2024 | SAMLJ, SAMLJ V35 I1

Retraction of a ‘hot-headed resignation’ caused by depression: Lessons from Cairncross/Legal and Tax (Pty) Ltd 2019 (2) BALR 137 (CCMA)

Author: Mafanywa Jeffrey Mangammbi

ISSN: 1996-2185
Affiliations: Department of Mercantile & Labour Law, University of Limpopo
Source: South African Mercantile Law Journal, Volume 35 Issue 1, 2023, p. 110 – 122
https://doi.org/10.47348/SAMLJ/v35/i1a6

Abstract

Unlike its celebrated siblings, Metropolitan Health Risk Management v Majatladi 2015 (36) ILJ 958 (LAC) (‘Majatladi’), National Health Laboratory Service v Yona (2015) 36 ILJ 2259 (LAC) (‘Yona’) and HC Heat Exchangers (Pty) Ltd v Araujo 2020 (3) BLLR 280 (LC) (‘HC Heat Exchangers’), Cairncross/Legal and Tax (Pty) Ltd 2019 (2) BALR 137 (CCMA) (‘Cairncross’) is the black sheep of the constructive dismissal family. The arbitration award in Cairncross brings into sharp focus emotional distress in the context of constructive dismissal. Cairncross provides a platform to isolate some of the critical issues that have arisen in recent times concerning constructive dismissal. First, there is a troublesome jurisdictional puzzle: Has the employee resigned or was he or she dismissed? Secondly, the case deals with the vexed question of what would constitute intolerable circumstances to continue the employment relationship, and in particular, whether work-related stress could form the basis of a constructive dismissal claim. In the case under scrutiny, the employee had claimed that her depression was attributable to the unbearable working environment. The basis of her claim of intolerability of continued employment was that an employer has a common-law and statutory duty to provide a safe working environment, which it had failed to deliver. Lastly, Cairncross also brings to the fore a consideration of the effect of tendering a resignation and the aggrieved employee’s subsequent attempt to withdraw it. The question that is answered is whether an employer’s failure to accept the withdrawal of resignation by an employee suffering from work-related stress constitutes a type of constructive dismissal.

On making, reporting, and repeating defamatory statements

by | Jan 28, 2024 | SALJ, SALJ V141 I1 2024

On making, reporting, and repeating defamatory statements

Author: Anton Fagan

ISSN: 1996-2177
Affiliations: WP Schreiner Professor of Law, University of Cape Town
Source: South African Law Journal, Volume 141 Issue 1, p. 1-14
https://doi.org/10.47348/SALJ/v141/i1a1

Abstract

This note starts by distinguishing the making from the reporting of a defamatory statement, and both of these from the repetition of one. Thereafter, having introduced the general rule that a defendant who made or reported a defamatory statement about a plaintiff to a third party cannot avoid liability on the ground that she was merely repeating a statement made by a fourth party, the note goes on to discuss certain already-existing exceptions, and possible exceptions, to this rule. Finally, the note looks at whether our law should acknowledge a further exception, namely where a defendant repeated a defamatory statement by reporting it, while knowing it to be false, but did so only in order to refute it.

A consideration of the Registrar’s powers in matters relating to the National Credit Act: An analysis of Gcasamba v Mercedes-Benz Financial Services (Pty) Ltd and Ngandela v Absa Bank Ltd

by | Jan 28, 2024 | SALJ, SALJ V141 I1 2024

A consideration of the Registrar’s powers in matters relating to the National Credit Act: An analysis of Gcasamba v Mercedes-Benz Financial Services (Pty) Ltd and Ngandela v Absa Bank Ltd

Author: Ciresh Singh

ISSN: 1996-2177
Affiliations: Associate Professor, University of South Africa
Source: South African Law Journal, Volume 141 Issue 1, p. 15-23
https://doi.org/10.47348/SALJ/v141/i1a2

Abstract

Section 23 of the Superior Courts Act 10 of 2013, read with rule 31(5) of the Uniform Rules of Court, empowers the Registrar of the High Court, save in exceptional circumstances involving residential property, to grant default judgments. The purpose of this rule is to prevent the overburdening of the court roll and judicial workload by allowing Registrars the discretion to grant default judgments in uncomplicated, undefended matters. In recent judgments in Gcashamba v Mercedes-Benz Financial Services SA (Pty) Ltd & another 2023 (1) SA 141 (FB) and Ngandela v Absa Bank Ltd & another [2023] ZAECELLC 6, the courts both found that a Registrar is not empowered to grant default judgments in matters relating to the National Credit Act 34 of 2005. The question thus arises whether the National Credit Act has changed and effectively reduced the Registrar’s powers. The implications of these judgments are far-reaching. Not only do they appear to have lessened the powers of the Registrar, but they also have the effect of increasing the administrative workload of judges and potentially delaying the enforcement process of credit agreements subject to the National Credit Act.

Opposing cynical evictions: The possessory action

by | Jan 28, 2024 | SALJ, SALJ V141 I1 2024

Opposing cynical evictions: The possessory action

Authors: Jeremy Phillips & Arthur van Coller

ISSN: 1996-2177
Affiliations: Senior Associate, Cheadle Thompson & Haysom Inc; Associate Professor, Faculty of Law, University of Fort Hare
Source: South African Law Journal, Volume 141 Issue 1, p. 24-44
https://doi.org/10.47348/SALJ/v141/i1a3

Abstract

The possessory action is a relatively unknown common-law remedy. It has not featured in the law reports for the best part of the last one hundred years and is generally relegated to a cursory discussion in most property-law textbooks. Its basic formulation is that where one has been dispossessed of an item, one is to be restored in possession, paid compensation and/or paid damages if one has a stronger right to possess the item than the dispossessor. Although it has fallen out of fashion, there is growing interest in how the possessory action may be used to address contemporary issues. One such issue is persistent and recurring cynical evictions — unlawful evictions during which the home structure is demolished and destroyed. Whether the possessory action is at all available as a remedy for cynical evictions is unclear. This article explores the history, nature, and scope of the possessory action and asks whether it can be appropriately applied to oppose cynical evictions.

The application of the doctrine of informed consent in South African medical law: Reflections on significant developments in the case law

by | Jan 28, 2024 | SALJ, SALJ V141 I1 2024

The application of the doctrine of informed consent in South African medical law: Reflections on significant developments in the case law

Authors: Marno Swart & Pieter Carstens

ISSN: 1996-2177
Affiliations: PhD Candidate in Medical Ethics and Law, University of Cambridge; Emeritus Professor of Medical Law and Criminal Law; Former Director of the Centre for Law and Medicine, University of Pretoria
Source: South African Law Journal, Volume 141 Issue 1, p. 45-83
https://doi.org/10.47348/SALJ/v141/i1a4

Abstract

The doctrine of informed consent is the foundation of the physician–patient relationship. This doctrine remains controversial despite its importance, and issues involving consent are frequently litigated. This article examines the application of the doctrine of informed consent in South African medical law as it has developed in South African case law. This examination first sets a normative background for consent as a ground of justification against a wrong ful act in either contract or delict (or both) that is significantly influenced by the Constitution of the Republic of South Africa, 1996. Against this normative background, a selected anthology of nine significant judgments by South African courts is analysed, with specific attention paid to the critical shift prompted by the promulgation of the Constitution. Finally, the analyses of the nine judgments are consolidated and collated to draw conclusions about the triumphs and failings of the South African courts, based on the normative background. This analysis reveals which aspects of the doctrine of informed consent have crystallised in South African medical law and which remain unclear.

Identification parades in South Africa — Time for a change?

by | Jan 28, 2024 | SALJ, SALJ V141 I1 2024

Identification parades in South Africa — Time for a change?

Authors: Colin G Tredoux, Ryan J Fitzgerald, Aldred Allan & Alicia Nortje

ISSN: 1996-2177
Affiliations: Professor, Department of Psychology, University of Cape Town; Assistant Professor, Department of Psychology, Simon Fraser University; Professor, Department of Psychology, Edith Cowan University; Post-doctoral Researcher, Department of Psychology, University of Cape Town
Source: South African Law Journal, Volume 141 Issue 1, p. 84-111
https://doi.org/10.47348/SALJ/v141/i1a5

Abstract

Identification parades are essential when obtaining evidence of identity from eyewitnesses. Eyewitnesses are shown a line of people containing the suspect(s) and innocent fillers, and witnesses are asked to point out the perpetrator(s) of the crime, noting that the perpetrator(s) might not be present. Corporeal (‘live’) parades are required in South Africa unless there is a good reason not to use them, in which case the police may use photograph parades. We review the rules for conducting parades in South Africa and compare these to those in several other countries, many of which no longer use corporeal parades. We consider evidence from empirical studies that have tested the ‘live superiority’ hypothesis and conclude that there is no clear evidence in its favour, notwithstanding that there are benefits to augmenting static views of faces with additional cues to identity. We then consider the logistical and financial cost of conducting live parades, which we find to be considerable. We conclude that it may well be time to reconsider the use of live identification parades in South Africa but caution that this should coincide with a review of the law regulating the use of alternative methods to ensure that accused persons receive fair trials.