The SABC’s interim board has lost an appeal to review a damning Special Investigating Unit (SIU) report that implicated them in unlawfully awarding a R185 million tender to Mafoko Security Patrols over five years ago.
The interim board members – Khanyisile Kweyana, Mathatha Tsedu, Febe Potgieter-Gqubule, and John Matisohn – were appointed in April 2017.
They approached the Johannesburg High Court intending to review and set aside an SIU report recommending they be rendered delinquent directors under the Companies Act.
They argued that the SIU went beyond the scope of the presidential proclamation when it made its recommendation.
Kweyana, Tsedu, Potgieter-Gqubule, and Matisohn contended that the SIU acted irrationally, and procedurally unfairly, exceeded its powers in reaching the findings it made, and unlawfully imposed severe remedial action against the SABC.
According to the court papers, the SIU made findings against the interim board members regarding events on June 30, 2017, at the SABC interim board meeting when the applicants awarded the tender to the security company.
The SIU found that the interim board had irregularly awarded the contract to Mafoko, a bidder that scored the second highest points.
According to the SIU, the board justified their decision by using BBBEE level status as an objective criterion, which cannot be used as a valid basis.
The interim board members contended that the remedial action contained in the report was reviewable in accordance with the Promotion of Administrative Justice Act (PAJA), as well as the principles of legality and the rule of law. The board insisted that substantive and procedural rationality and fairness requirements have not been complied with.
As a result, the interim board took the matter to the Johannesburg High Court, where the SIU defense counsel argued that the application should be dismissed with costs, as neither PAJA nor the principle of legality applies.
However, Judge Dorio Dosio stated that the recommendations of the SIU must be understood as a legitimate comment on whether any official had been culpable of improper activity.
The Court also stated that a challenge to the validity of an exercise of public power that is not final in effect is premature.
“The findings of the SIU are inchoate and not susceptible to review under PAJA. As a result, the SIU’s report does not comply with the requirements of administrative action in terms of PAJA, as there is no decision yet, merely a recommendation. It is also premature and definitely not final in effect,” said Dosio.
The interim board members had contended that if the SIU report is not reviewable under PAJA, then it is reviewable based on the principle of legality and the rule of law on the grounds that the requirements of substantive and procedural rationality and fairness have not been complied with.
The interim board members argued that the SIU was only empowered to investigate the procurement of goods, works, or services inconsistent with fair, competitive, transparent, equitable, or cost-effective processes.
Nonetheless, Judge Dosio accepted an argument by SIU lawyers who disputed whether they acted irrationally or whether their process in investigating the maladministration was irrational or unfair.
He further accepted their use of a Constitutional Court judgment stating that courts may not interfere with the means selected simply because they do not like them or because other more appropriate means could have been selected.
“The principle of legality is a fundamental principle of constitutional law. It stems from the doctrine of the rule of law, which states that the use of all public power, whether legislative, executive, or administrative, is only legitimate when it is lawful,” said Dosio.
The judge stated that the SIU was asked to investigate severe issues of maladministration at the SABC, and the procedural means adopted by the SIU to obtain the objective sought are rational.
The court further found that the SIU had the power to investigate the fiduciary duties of the SABC, and as a result, the actions of the SIU were not ultra vires.
The interim board members contended that although the audi alteram partem rule applies in respect to the SIU writing to the interim board members to make submissions on evidence, they were entitled to be informed of the remedial action.
The court dismissed the argument that the interim board members were in fact, given a fair hearing and held that the duty on the part of the decision-maker to ‘act fairly’ is simply another way of saying that the decision-maker must observe the principles of natural justice.
The court found that the interim board members were given more than enough opportunity to address any issue that could implicate them, as they did have the benefit of audi alteram partem.
The court dismissed the application of the interim board but did not award any costs against them.
“This court finds that the SIU complied with its duties in terms of the Special Tribunals Act and that the actions of the SIU are not unconstitutional, unlawful, or unfair. Accordingly, the review is dismissed,” ruled Dosio. “The interim board members have brought this review application to vindicate their constitutional rights to fair administrative action and to access justice. Although they brought it in their own capacity, the issue of costs is at the discretion of this court. The interim members were not malicious in launching this review. This court will not make a cost order against the interim board members.”
Mafoko Security Patrols has since distanced itself from the interim board’s decision.