Thursday, June 26, 2008

The Constitution has forbidden the imprisonment of debtors unable to pay their debts.
The landmark case of Coetzee v Government of the Republic of South Africa; Matiso & Others v Commanding Officer, Port Elizabeth Prison & Others 1995 (4) SA 631 (CC) rendered Sections 65A to 65M of the Magistrate’s Court Act unconstitutional.
It was a decision premised on the finding that these debtors imprisonment provisions were inconsistent with the right to personal freedom entrenched in the Constitution.
The Magistrate’s Court Amendment Act 81 of 1997 was subsequently enacted to abolishing all relevant Sections 65A to 65M provisions.
Section 19(1)(c) of the Supreme Court Act 59 of 1959 dealing with the jurisdiction of the High Court provides:
“(c)…. ,any High Court may-
(i) issue an order for attachment of property or arrest of a person to confirm jurisdiction or order the arrest suspectus de fuga also where the property or person concerned is outside its area of jurisdiction but within the Republic: Provided that the cause of action arose within its area of jurisdiction; and
(ii) where the plaintiff is resident or domiciled within its area of jurisdiction, but the cause of action arose outside its area of jurisdiction and the property or person concerned is outside its area of jurisdiction, issue an order for attachment of property or arrest of a person to found jurisdiction regardless of where in the Republic the property or person is situated.” (my emphasis).
These provisions relate to founding or confirming jurisdiction of a High Court in instances where the defendant in a civil matter is not resident or domiciled in South Africa – in other words, a foreigner.
The general principles of a High Court’s jurisdiction are:
• Either the court within which area the defendant resides or is domiciled has jurisdiction to hear the matter; or
• The cause of action (for example, the contract or a delict) must have arisen within the court’s area of jurisdiction.
In the former case, this principle cannot be applied to a foreigner.
Accordingly, our law allows a resident plaintiff access to the courts so as to avoid the expense of suing a foreign defendant in another country. However, to proceed on such a basis, the court in question has to have jurisdiction, which involves a two-pronged approach whereby the court must be in a position to:
• Take cognisance of the suit in question; and
• Give effect to any judgement which is handed down – the “doctrine of effectiveness”.
Thus, irrespective of whether the cause of action arose within the jurisdictional area of a court, if the defendant is a foreigner, then an attachment or arrest is necessary to found or confirm the jurisdiction of a South African court.
The cause of action element merely determines whether the plaintiff is going to bring an application to found jurisdiction (where the cause of action did not arise within the court’s jurisdiction) or an application to confirm jurisdiction (where the cause of action did arise within the court’s jurisdiction).
Following the Coetzee decision, it was a matter of time before the provision of arrest was challenged on constitutional grounds. And so it came to pass in Bid Industrial Holdings (Pty) Ltd v Strang & Others [2007] SCA 144 (RSA), in which the appellant sued the two Australian-domiciled respondents for delictual damages.
In order to found jurisdiction of the Johannesburg High Court, the appellant applied for an order for the respondents’ arrests.
The respondents opposed the application on the grounds that:
• On the merits, there was no prima facie case against the respondents; and
• Foreign nationals, while in South Africa, enjoyed the protection of the Constitution and their arrest would be contrary to the Bill of Rights.
The Minister of Justice, who was joined to the application owing to the constitutional challenge of the legislation, submitted that the legislation was not unconstitutional as the provisions were enacted to give effect to a plaintiff’s rights to courts’ access under section 34 of the Constitution.
The Minister submitted further that the court could exercise its discretion in granting an application for arrest by balancing the rights of the plaintiff and the defendant; and that the Act spoke of “arrest” only and not actual detention.
The Court emphasised that the crucial jurisdictional purpose of attachment and arrest was to enable it to hand down an effective judgement. In deciding whether the arrest of a foreigner would achieve this purpose, the Court considered various aspects, the first of which was whether arrest infringed on an individual’s rights to freedom and security.
The Court disagreed with the Minister’s argument that arrest in terms of Section 19(1)(c) of the Act was merely a symbolic act and did not require actual detention. There was no legal obligation on a foreigner to either consent to the jurisdiction of a South African court or to provide a monetary basis to avoid the arrest. The legislation could only have contemplated actual detention.
Jurisdictional arrest was thus aimed at limiting the defendant’s liberty.
In determining whether this was unconstitutional, the Court had to consider whether there was a “just cause” for such a limitation.
In considering whether the arrest of a defendant would result in an effective judgement, the Court distinguished between attaching property and arresting a person.
In the former, there is no infringement of constitutional rights and the property itself would serve to secure the payment of any judgement handed down against the defendant. Arrest would achieve neither of these results.
Arrest would only serve to coerce a defendant to make payment of the debt claimed or to provide security therefor in order to guarantee his liberty and prevent imprisonment.
In both instances, it could not be said that there was “just cause” in arresting the defendant.
To declare the provision of arrest unconstitutional, the Court had to decide if the limitation requirements of Section 36 of the Constitution had been satisfied, bearing in mind that the purpose of jurisdictional arrest was to allow a resident plaintiff to institute proceedings against a foreigner in order to avoid the trouble and expense of suing abroad.
The Court maintained that there were less restrictive means to establish jurisdiction than arrest and that the common law needed to be developed to provide alternative possibilities to jurisdictional arrest, especially in matters where attachment was not possible.
The common law, through case law, needed to be developed to decide whether jurisdiction against a foreigner could be established without arrest or attachment. Substitute practices, other than arrest, were required.
The Court cited the example of the enforcement of a foreign civil judgement in South Africa, where a South African court conferred jurisdiction on a foreign court by the mere physical presence of the defendant in that country at the time of the institution of the proceedings.
In considering legally competent alternatives to arrest, the Court held that a court could consider a suit where the summons was served on the defendant while present in South Africa and there was an adequate connection between the suit and the court’s jurisdiction, such as the cause of action having arisen in that court’s jurisdiction.
The Court abolished the common law rule of arrest. In lieu thereof, should attachment not be possible, then a “South African High Court will have jurisdiction if the summons is served on the defendant while in South Africa and there is sufficient connection between the suit and the area of jurisdiction of the court concerned so that disposal of the case by that court is appropriate and convenient”.
Accordingly, Section 19(1)(c) of the Act was made redundant and ordered to be removed by legislative amendment. Until this happens, the section must be read down.
Once again Secdtion 36(1) of the Constitution has resulted in a change in the face of civil procedure to fall within the realms of what is considered to be “reasonable and justifiable in an open and democratic society based on human dignity, equality and freedom”..
Sally D’Arcy-Donnelly is a senior associate at commercial law firm Bowman Gilfillan.