President of the Republic of Namibia v Namibia Employers Federation (SA 53-2020) [2022] NASC (2 September 2022) – suspension of labour laws due to state of emergency
After declaring a State of Emergency, the President of Namibia proceeded to impose a nationwide lockdown restricting the movement of people, save those performing ‘essential services’, purportedly in terms of Article 26(5)(b) of the Constitution. To protect workers’ salaries, the President, purportedly in terms of Art 26(5)(b), suspended certain provisions of the Labour Act, 11 of 2007 (ss 12, 23 and 34), and also delegated to ministers his regulation-making power under Art 26(5)(b) (Regulations 14 and 15).
Article 26(1) and (5) (a) and (b) gives the President power to declare a state of emergency (SOE) and to make regulations to suspend the operation of any rule of the common law or statute, or any fundamental right or freedom protected by the Constitution when the nation is confronted by a national disaster, a state of national defence, or a public emergency threatening the life of the nation or its constitutional order, ‘for such period and subject to such conditions as are reasonably justifiable for the purpose of dealing with the situation which has given rise to the emergency.’
Two employers’ organisations challenged Reg. 19, principally on the basis that it was aimed solely at protecting workers’ livelihoods, and did not meet the constitutional threshold of being ‘reasonably justifiable’ to deal with the situation that gave rise to the SOE. The employers’ organisations also challenged the President’s delegation of directive-making power to ministers on the basis that it was ultra vires Art 26(5)(b), as only the President is authorised to make regulations. The High Court agreed with the employers’ organisations, and struck down the suspension regulations and the President’s delegation of directive-making powers. The Government appealed to the Supreme Court.
On appeal, the Supreme Court considered the appeal and held that:
Article 26(5)(b) must be read to include an implied power for the President to make regulations to deal with the situation that has given rise to the SOE, but such regulations must themselves be reasonably justifiable for the stated purpose; that farther removed such a regulation from the situation that has given rise to the SOE, the higher the burden of justification required; such regulations must also be reasonable, and be rationally connected to the legitimate objective of arresting the spread of the pandemic.
Reg 19 was both unreasonable and irrational, and therefore the High Court’s’ order invalidating it was correct.
The challenge to the directive-making power was premature, and the High Court’s order declaring Regulations 14 and 15 must be set aside.
In the result, the appeal succeeded in part only.
S v Noble (CC 10-2020) [2022] NAHCMD 434 (25 August 2022) – criminal liability of directors or members for acts committed in official capacity on behalf of the corporate entity
The two accused persons were charged with dealing in cocaine in contravention of section 2(c) and possession of cocaine in contravention of section 2(d) of the Abuse of Dependence-Producing Substances and Rehabilitation Act 41 of 1971, and money laundering in contravention of section 4(b)(i) of the Prevention of Organised Crime Act 29 of 2004. It was alleged that the accused imported cocaine from Brazil into Namibia through an entity. The accused denied the charges.
In their section 115 plea, the accused persons asserted that although the state referred to section 332(5) of the CPA in the heading of count 1 on which a natural person (director of a company or member of a CC), could be held criminally liable for actions committed in an official capacity on behalf of a corporate entity, the state failed to explicitly set out the essential facts to be proven (factum probandum) in the body of the charges to rely on criminal vicarious liability as contemplated by section 332(5). The accused persons argued that the state failed to set out allegations on which personal criminal liability of accused 1 and 2 for acts allegedly committed by the entity, can be invoked. The Court considered the evidence, its earlier judgement on 174; S v Kapia (CC 09/2008) 2018 NAHCMD 124 (11 May 2018) and stated that;
‘I am of the view that the evidence referred to supports the contention by the state that accused 1 and 2 utilised the entity to import the container from Brazil. I find that accused 1 and 2 cannot be excluded herein by the provisions of s 332(5) on the basis of the corporate legal personality of the entity, given their close involvement in the matter and the manner in which they improperly used the entity.’
In the result, the court held that a director of a company or a member of a close corporation may be found criminally liable for acts committed in an official capacity on behalf of the corporate entity when the provisions of s 332(5) of the CPA are invoked, notwithstanding the protection that must be afforded to the close corporation being a separate legal entity, as where fraud, dishonesty or improper conduct is proven, the court may consider same and go beyond the corporate personality in order to arrive at the true facts and impute liability accordingly.
Windhoek Wanderers v Municipal Council of Windhoek (HC-MD-CIV-MOT-REV-2020-00306) [2022] NAHCMD 435 (25 August 2022) – resolution required to institute or oppose proceedings on behalf of juristic person.
The applicant approached the High Court, seeking the review of a decision taken by the CoW. On 13 April 2021, 3rd respondent filed an answering affidavit purporting to act on behalf of CoW in which 3rd respondent alleged that he was “employed by the first respondent”, and that he was “duly authorised by the first respondent to depose to this affidavit”. The applicant raised a point in limine of a lack of authority of the 3rd respondent to oppose the review application on behalf of 1st respondent, which point the respondents failed to address. The Court had to determine whether there was evidence before it that 3rd respondent had such authority, and held that:
There was no resolution passed by 1st respondent authorising 3rd respondent to act on its behalf and oppose the application.
It is trite law that, where a litigant is an artificial person, some evidence must be placed before the court to show that such artificial person has duly resolved to institute or oppose the proceedings, and that the proceedings are being instituted or opposed at its instance.
The best evidence that the proceedings have been properly authorised is normally provided by an affidavit made by an official representing the artificial person, annexing a copy of a resolution to that effect. Though not necessary in every case, the court must decide in each case whether enough evidence has been placed before it to warrant a conclusion that it is the artificial person which is litigating, and not some unauthorised person purporting to act on its behalf.
The onus was on 3rd respondent to prove that he was duly authorised. He failed to allege and prove such authority.
In the result, the point in limine succeeded.
Moller N.O v The Master of The High Court (HC-MD-CIV-ACT-DEL-2020-02089) [2022] NAHCMD 359 (21 July 2022) – misappropriation of estate money; circumstances for holding State liable for negligence.
A law firm acting on behalf of the family of the deceased, reported the estate to the Master of the High Court, with a proposal that the former husband of the deceased be appointed as the executor. Security was set in the sum of N$ 2, 055, 000.oo, but neither the former husband or the heirs could provide it. It was then proposed that the appointment be delayed until the 2nd plaintiff turned 21 years. On 26 November 2015, the law firm advised the Master that the 2nd defendant was now a major, and that the letter of executorship could be issued. In response, the Master informed the law firm that 3rd defendant was appointed as executor. The lawyers complained that the heirs and the family of the deceased were not consulted about or informed of the appointment of 3rd defendant.
It turned out that the 3rd respondent had provided a bond of security of N$ 2, 000,000.00 for the due administration of the estate. Subsequent to that, 3rd defendant opened an estate account and transferred N$ 1,274,557.36 into the account, and thereafter, transferred N$ 1,000,000 from the estate’s account to the account of the 4th defendant. The estate account was depleted by March 2016. The plaintiff sued the defendants for delict.
The court held that it was apparent that the Master and its officials at no stage required the 3rd defendant to account for any of the assets he was tasked to liquidate and distribute, prior to reducing the amount of security. It was further clear that the Master or its officials had not the slightest idea what assets were collected, which assets were distributed in the interim, and which remained in the estate to be distributed later. Despite not having any idea, the 3rd defendant was not called upon to account for any of the assets. The Court noted that had that been done, the fact that certain assets were misappropriated would in all probability have come to light. The fact that nothing was done was not only a flagrant disregard for the provisions of section 24 of the Administration of Estates Act, 66 of 1965, it was grossly negligent. The court further found the Master or its officials to have omitted to act, wrongfully and negligently and without due care, and in terms of section 100 of the Administration of Estates Act, held the State liable for negligence or omissions to act by the Master.
In the result, 2nd , 3rd , and 4th defendants were ordered to pay the 1st plaintiff the sum so misappropriated, jointly and severally, the one paying and the other to be absolved.
Lady Pohamba Private Hospital (Pty) Ltd v Shovaleka (HC-MD-LAB-APP-AAA-2021-00053) [2022] NALCMD 42 (28 July 2022) – whether compensation follow reinstatement; appeal against award.
In this Labour matter, the 1st respondent was dismissed by the LPPH following a disciplinary hearing. The 1st respondent referred a dispute to the Office of the Labour Commissioner, and the arbitrator found in favour of the hospital. The arbitrator ordered that the 1st respondent be reinstated and compensated her salary, inclusive of benefits for a period of 14 months. The hospital appealed against the sanction imposed by the arbitrator, on the grounds that insufficient evidence was placed before the arbitrator to justify the sanctions she imposed, and further that her compensation award was manifestly high in the circumstances.
The court considered the applicable legal principles and the provisions of the Labour Act, 11 of 2007, and stated that the arbitrator may make an appropriate order, including but not limited to an order for reinstatement and an award of compensation (section 86(15)), and held that:
There was no evidence presented to the effect that the employer-employee relationship had irretrievably broken down, thereby rendering an order for reinstatement impossible.
No reasons were advanced by the arbitrator for the compensation award. However, given the period of lockdown occasioned by the global Covid-19 pandemic, there was sufficient evidence on record enabling the court to alter the compensation award in terms of s 89(10) of the Labour Act.
In the result, the award of reinstatement was upheld and the 1st respondent was reinstated effectively. The award of compensation was set aside, and the Hospital was ordered to pay 1st respondent compensation by way of full salary and benefits for a period of 9 months in total.
Fedden Mainga Mukwata writes in his personal capacity as an admitted Legal Practitioner and founder of FASZ Legal Consultancy CC, as part of his efforts to promote access to law and justice, and may be reached at consultfasz@gmail.com.