‘Nil compensation’ is a legally and constitutionally sound software that parliament has chosen to make use of to attain authentic governmental ends
Martin van Staden’s screed, The Expropriation Act is essentially unconstitutional’ revealed within the opinion part on the Mail & Guardian’s web site on 29 January, is incorrect.
He alleges that the idea of “nil compensation” is an occasion of parliament performing in fraudem legis (in fraud of the legislation), searching for to subvert the Structure by organising “a legalistic and formalistic ‘simulation’ to obscure and conceal the substance or actuality” of what it’s doing.
What it’s doing, Van Staden says, is allowing the expropriation of property with out compensation opposite to what part 25(2)(b) of the Structure requires. This, he says, is as a result of a “nil” “quantity” can’t be “paid” to the proprietor of expropriated property, therefore the “simulation”. This might be true if it was the complete story, however it’s not.
First, the idea of “nil compensation” is what we legal professionals name a authorized fiction: one thing that exists in legislation however not in actuality. There are various such fictions in our legislation and the legislation of principally each different nation on Earth. One outstanding instance of a authorized fiction is company authorized character, the concept that an organization exists as an entity unbiased of its shareholders.
This implies the corporate can sue and be sued in its personal identify, purchase and promote belongings and be answerable for its personal money owed, amongst different issues. Its impact is that shareholders can’t be held liable for his or her firm’s money owed, nor can they declare its belongings as their very own. This authorized fiction serves a function: to restrict the legal responsibility of the shareholders to provide them an incentive to create and make investments their cash in companies with out placing their private belongings on the road within the case of an organization failing.
It’s an indispensable authorized fiction that’s the bedrock of all financial exercise in all market-based economies. “Nil compensation” will operate in an identical means. It’s going to permit the state, in sure circumstances, to expropriate property with out paying any compensation for it, within the public curiosity. Put in any other case, it should create the fiction that the property was paid for regardless that no cash will probably be exchanged as a result of the quantity can be set at “nil”. This would be the case, particularly, the place the expropriation is for the needs of land reform.
One might quibble with the aim for which the idea of “nil compensation” will probably be employed, however there’s nothing inherently or essentially unconstitutional about it. Like company authorized character, “nil compensation” is a legally and constitutionally sound software that parliament has chosen to make use of to attain authentic governmental ends. It’s not fraus legis to make use of authorized fictions in laws; on the contrary, it’s how legislation — that artefact of synthetic purpose — works.
Second, Van Staden claims that the Expropriation Act is unconstitutional as a result of it permits for the state to take possession of the expropriated property earlier than compensation has been paid to the proprietor. However that is additionally incorrect.
In Haffajee N.O. and Others v eThekwini Metropolitan Municipality, the constitutional court docket held that ‘[t]he provisions of part 25(2)(b) [of the Constitution] don’t require that the quantity of compensation and the time and method of cost should all the time be decided … earlier than expropriation below part 25(2)” whereas acknowledging that it is going to be typically be simply and equitable for compensation to be decided earlier than expropriation takes place. Once more, there isn’t a unconstitutionality there.
Third, Van Staden claims that in response to the work of the Dutch jurist Hugo de Groot, expropriation is “irrevocably tied to compensation” and that “expropriation with out compensation” is thus a contradiction in phrases. Grotius, in his On the Legislation of Conflict and Peace, a piece of public worldwide legislation, discusses expropriation (or eminent area) within the context of what a state might do, after a battle, to settle money owed incurred in battle.
There, he explicitly states that the state should all the time compensate an proprietor for expropriated property and that the proprietor could also be required to contribute a few of that compensation to assist repay these wartime money owed.
Elsewhere in the identical work, addressing the idea of expropriation extra broadly, he states that “by the company of the king, even a proper gained by topics might be taken from them … by the power of eminent area” topic to 2 circumstances. First, there should be a public benefit or function. Second, “compensation from public funds be made, if attainable, to the one who has misplaced his proper”.
Van Staden would have you ever imagine that Grotius considered compensation as an absolute requirement for lawful expropriation. That’s not so. Even Grotian students agree that “not in each case is compensation required”.
Final, Van Staden seems to be satisfied that the Structure requires compensation as an absolute requirement and that parliament couldn’t, by the Expropriation Act, deviate from that requirement. That can be incorrect. Part 25(8) of the Structure explicitly empowers the state to deviate from the opposite provisions of part 25.
It states that: “No provision of this part might impede the state from taking legislative and different measures to attain land, water and associated reform, so as to redress the outcomes of previous racial discrimination, offered that any departure from the provisions of this part is in accordance with the provisions of part 36(1).”
Plainly, Parliament has the facility to deviate from provisions of part 25 together with the compensation requirement in part 25(2)(b).
Van Staden is clearly ideologically motivated to make the sort of argument he makes in his piece. However it’s not in any respect a real reflection of how the legislation, or the Structure, works. Recklessly making alarmist claims might serve his political pursuits, however he’s not a authorized thinker value taking severely.
Maybe he ought to make it clear in future that his arguments relaxation on his thought of what the legislation must be, not what it’s, as a result of it’s embarrassing for any lawyer to have such a poor grasp of the legislation.
Dan Mafora is an LLM candidate in constitutional principle on the College of Cape City and the writer of Seize within the Courtroom: In Defence of Judges and the Structure (Tafelberg, 2023). He’s the senior researcher on the Council for the Development of the South African Structure, and beforehand labored for the constitutional court docket.