Namibia Fin Exchange (Pty) Ltd v CEO of Namfisa and others (SA 23-2022) [2024]NASC (3 September 2024)

What transpired?  

After consultations with various stakeholders from 2011 to 2012, it became apparent to the appellant that there was a need for a second Stock Exchange in Namibia. The founders of the appellant (Namibia Financial Exchange (Pty) Ltd and with the assistance of consultants – Business Services and Management Solutions International, led by Mr Anthony de Silva – established a consortium to create a second Stock Exchange in Namibia to be called the Namibia Financial Exchange (Pty) Ltd. On 8 May 2012, the appellant applied to Namfisa for a Stock Exchange Licence. According to the appellant, the first respondent, (who was then the late Mr Phillip Shiimi), acknowledged receipt of the licence application and the prescribed application fee by letter dated 15 May 2012. On 9 September 2014, the application was declined following the exchange of numerous correspondence over a period of at least two years. 

Disgruntled by the outcome of its application, the appellant instituted proceedings in the High Court seeking relief. The appellant averred that the decision was unlawful and that the first respondent was not functus officio after 9 September 2014 because it still requested further documents from the appellant after 9 September 2014 thereby creating the impression that it would still assess the application when presented with the requested information. The High Court, dismissed the appellant’s application with costs. The appellant appealed against the whole judgment and order of the High Court, to the Supreme Court.

What were the issues?

The Supreme Court considered three main issues (a) functus officio, (b) delay and (c) conflict of interest. 

Discussion 

‘[112]    In my opinion, the appellant fails on the merits. One looks in vain for the allegations by the appellant against the respondents. This is a case where the appellant must blame itself for its conduct of continuously refusing to provide the information sought from it and over-prescriptive towards the respondents. 

[113]      The functus officio stance of the Registrar of 5 February 2016 is not one of the actions and decisions that caused the respondents to arrive at the decision of 9 September 2014, declining the appellant’s application, which is the appellant’s main prayer. Mr Maleka argued that the court below on the delay reflected on the conduct of the appellant only and not on that of the respondents, and that on the facts that are common cause, much of the delay, if any, was attributed to the conduct of the respondents. I am not persuaded by this argument. As I have demonstrated above, there is nothing to impute to the respondents as the cause for the delay on merits or to fault the approach of the court below on the point, to which I turn very briefly.

[114]      The court below cannot be faulted on the approach it adopted on the delay. Its reasoning is that the decision of 9 September 2014 was done in no uncertain terms and for reasons given, and that the fact that the appellant was also given the option to re-submit the application is neither here nor there because that option was really irrelevant in view of the decision that had clearly been made. The learned judge concluded that the decision of 9 September 2014 was neither inchoate nor incomplete. Once the decision was made, the principle of functus officio came into play. The court relied on the decision of this court in Hashagen v Public Accountants’ and Auditors’ Board, which says an administrative decision is deemed to be final and binding once it is made. The decision-maker cannot re-open or revoke the decision unless authorised by law expressly or by necessary implication. The court below then found that once the decision of 9 September 2014 was communicated to the appellant, it became subject to the right of appeal or review, and the Registrar consequently lost his jurisdiction in the matter. He could not go back on his decision or assume power again in respect of the same matter…

[115]      The court below further found that the period from 9 September 2014 to 26 July 2016 when the appellant lodged its application is a period of almost two years, which was unreasonable. It further found that the delay could not be condoned for the reasons that the appellant had legal advice at all times, and should have appreciated the underlying policy reasons for instituting proceedings for judicial review or declaratory relief promptly and without undue delay, that the delays that the appellant allowed to occur were deliberate and were occasioned knowingly, regardless of the consequences. It found that the appellant’s ill-advised fixation with a provisional licence was flogging a dead horse, and approaching the minister of finance and the AG and chairperson of the second respondent or copying to them the letter of demand of 21 January 2016 was done with a clear intention to influence the decision of the Registrar by one or all of them. Furthermore, the threats contained in the letter of demand, the prejudice to the members of the public who would have made their objections as far back as 2013, and the stale information provided during 2012–2014 is no longer current. 

[116]      The court turned to the merits, and among other things found that it was common cause that the appellant’s application was non-compliant and defective from its submission in May 2012. I agree.

[120]      What comes out in the present case, however, is the appellant’s perpetual refusal to provide the information requested deliberately for that matter, regardless of the consequences. Its pursuit of a provisional licence, well-knowing by its own admission that the Act makes no provision for a provisional licence, is not only unfathomably deliberate and self-defeating but is so unreasonable. The comparison between the delay in this case and of what occurred in Oudekraal is out of place and stands to be rejected. Neither can public interest in the two situations be comparable. The public interest in the Oudekraal speaks for itself.

[121]      On the principle of functus officio, it was argued that the suggestion that the Registrar was functus is fundamentally wrong as a matter of fact and law because in his decision of 9 September 2014, the Registrar never took the position that he was functusbut only did that on 5 February 2016 when the information he had requested was given to him. What the court below said on functus officio holds for this judgment. In the letter of 9 September 2014, the Registrar declined the application and gave reasons for doing so. He further said re-submit a fresh application. The court below articulates the law on functus officio in that regard, inter alia, it said when the Registrar purported to reopen his decision he lacked jurisdiction and could not have done so; meaning re-opening his decision, but once the appellant had rejected his proposals in the letter of 15 October 2014, the Registrar was back in his initial decision as if he never re-opened it and functus kicked in. 

[122]      It must be remembered that when the appellant wrote in its letter of 11 April 2016, inter alia that ‘we thus provide to you the following information requested in your correspondence dated 9 September 2014 on a confidential basis’. The Registrar never requested information in his letter of 9 September 2014. He gave reasons for declining the application. The main relief sought by appellant revolves around his decision of 9 September 2014. That decision was final and he only left the door open for a fresh application. Counsel’s submission on this point should also fail.

[123]      Can this court substitute its own decision for that of the Registrar or compel him to issue the licence to the appellant or give direction to the Registrar on how he should go about the appellant’s application? Mr Maleka argued that the primary remedy that the appellant asks the court to consider is one of substitution. When it was pointed to him that that relief was not part of the notice of appeal, counsel retorted that the court should take both prayers 1 and 2.3 together with para 4 to issue an order the court considers appropriate in the circumstances. That the Registrar did not refuse the application on public interest considerations but rather on s 8(b) and (c) which was a narrow basis and that if the court is not inclined to grant the remedy of substitution, the court should remit the matter back to Registrar with clear directions on how the matter should progress.

[124]      Ms Bassingthwaighte to the contrary, submitted that the court should not venture in that unknown direction as the court does not know whether the rules of the appellant comply with the Act.

[125]      I agree. The answer to the question on point is ‘No’. In Trencon Construction (Pty) Ltd the Constitutional Court of South Africa summarised the factors a court should consider when determining whether an order of substitution is appropriate, namely: (i) whether the court is as well qualified to decide the issue as was the original administrator; (ii) whether the end result is a foregone conclusion; (iii) where there has been a delay in the finalisation of the matter, whether further delay of the matter would be unjustifiable; and, (iv) whether the original decision maker has demonstrated bias or incompetence. That court went on to say the ultimate question is whether a substitution order is just and equitable, which involves a consideration of fairness to all implicated parties. That court further said; a court will not be in as good a position as the administrator where the application of the administrator’s expertise is still required and a court does not have all the pertinent information before it.

[126]      For the reasons I demonstrated above, particularly that the information the appellant purported to provide in its letter of 11 April 2016 was still not compliant with the SECA, in my opinion, the court cannot substitute its own decision for that of the Registrar or compel him to issue a licence to the appellant, nor giving directions on how he should progress going forward. The Registrar has in his letter of 27 April 2016, particularly para 3 referenced what the appellant is required to do. In fact, in his affidavit, he states that the rules have changed, and the appellant’s information of 2012 is stale. It is over 12 years since the application was submitted and the invitation for this court to grant a substitution remedy is unattractive and should be refused which I do. It follows that the conclusion arrived at by the court below cannot be faulted, and the appeal should fail.’

How were the issues determined? 

Held that the decision of 9 September 2014 was lawful. The appellant failed to provide by 9 September 2014, documents and/or information required in terms of s 8 of the Stock Exchanges Control Act 1 of 1985 (SECA) for the granting of a Stock Exchange Licence, despite such information being requested already on 21 November 2012.

Held that, upon communicating the decision of 9 September 2014, the first respondent became functus officio.

Held that, there was no conflict of interest on the part of the first respondent, particularly when regard is had to the conduct of the parties throughout the application evaluation process.

Held that, the appellant caused a significant delay in instituting the application a quo. However, the first respondent’s contribution to the delay cannot be overlooked as he continued to request further information or documents after 9 September 2014. Such requests were in any event ultra vires the Act as he had no power in terms of the Act to revisit his decision of 9 September 2014.

What the court ordered:

The appeal was dismissed with costs, such costs to include the costs of one instructing and one instructed legal practitioner.

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