The Companies Act gives certain persons the right to apply for a court order to declare a Director as delinquent and whereafter imposing restrictive conditions on said Director.

 

According to Section 162(2) those who may apply for an order to declare a Director delinquent are:

  1. A shareholder;
  2. A Director;
  3. A company Secretary;
  4. Prescribed officer;
  5. A registered Trade Union;
  6. An Organ of State or;
  7. CIPC itself.

 

There are certain reasons or categories of behaviour in which the Director must act to classify himself/herself as a delinquent this would be one of the following but not limited to:

  1. Where the Director consented to act when he/ she was disqualified;
  2. When he/she was under an order of probation;
  3. Where a Director grossly abused their position;
  4. Where they took personal advantage of information or by intentional or by gross negligence caused harm to the company;
  5. Has been convicted of the same offence twice before or subjected to an administrative penalty before

 

In the event where the court finds that an order of delinquency is too harsh then the court may rather declare an order of probation. Some of the grounds of probation are but are not limited to:

  1. Where the Director was present at a meeting and failed to vote;
  2. Acting in such a way that is inconsistent with their duties; or
  3. Where the director acts oppressively or unfairly.

 

A director who has been declared a delinquent may have an order that is conditional or unconditional and the conditions may last from 7 years or longer depending on the nature of the conduct of the director. Certain conditions could include a payment of damages or being supervised by a mentor or alternatively being disqualified as a director altogether.

According to the Act if a Director has been qualified as a delinquent Director then after a period of three years he/she can apply to the court to suspend the order or apply to substitute same to an order of probation.

 

What is the public register?

In many cases people are not honest about their past history with those they get into business with. This is the reason why the Companies Act requires CIPC to have and maintain a public register of disqualified persons from serving as Directors.

 

In Conclusion

It matters not what type of business is created the Companies Act allows for liability of Directors in all businesses and although the Act has allowed many freedoms it makes sure that misconduct is dealt with strictly.

A father will have his parental rights and responsibilities in respect of the child if at the time of the birth he was living with the mother in a permanent life partnership or :

  1. Consents to be identified as the father;
  2. Contributes to the child’s upbringing for a reasonable period; and
  3. Contributed towards expenses with the maintenance of the child for a reasonable period.

 

These rights and responsibilities are in accordance with Section 21 of the Children’s Act and whether or not the father has rights and responsibilities does not affect his duties to contribute towards the maintenance of the child.

 

A court can terminate a parents rights and responsibilities but according to section  to Section 28 of the Act, the court will have to take into consideration:

  1. The best interests of the child;
  2. The relationship between the child and the person whose rights are challenged;
  3. The degree of commitment the parent has shown toward the child and;
  4. Any other relevant factor the court may find important.

Ms Bwanya and Mr Ruch were involved in a long term romantic relationship, supporting each other financially and living together like a married couple. They intended to marry and were engaged but did not have the opportunity before Mr Ruch passed away.

 

Mr Ruch left a will and his only heir was his mother who was recently deceased. Ms Bwanya submitted a claim to the Executor and Master for a Universal Partnership in order to inherit from Mr Ruch’s estate. This was rejected by the Master and she was directed to approach the courts to prove her claim.

 

The Cape Town High Court declared that part of the Intestate Succession Act is unconstitutional as it excludes opposite sex persons in a permanent life partnership. Ms Bwanya has been granted the right to inherit from Mr Ruch’s estate as a permanent life partner.

 

This issue may still be tested by the Constitutional Court and the Intestate Succession Act will have to be amended to include permanent life partners. This is a very interesting development in our law!

Most parents might be asking themselves a few questions about a minor child having to appear at court as a witness and if a minor can appear as a witness what the legal position is.

It important to know what a minor child is. A minor is a child under the age of 18. He/ she lacks full legal capacity and cannot litigate or enter into a contract without the assistance of a guardian.

What is expected from a minor child in court?

The Common Law provides that every child may testify provided that:

  1. The child can appreciate the duty to speak the truth;

 

  1. The child has sufficient intelligence to understand the proceedings;

 

  1. The child can communicate effectively enough to understand his/ her testimony;

A child’s evidence must be approached with caution and the court must be satisfied regarding the competence of the child to give evidence. Like all other witnesses’ children must be sworn in before they testify.

 

What happens if a child is unable to understand the nature of the proceedings?

If the child is unable to understand what it is to take the oath the court is allowed to admonish the in terms of Section 164(1) of the Criminal Procedure Act. This means that the court will make a formal statement to caution the child about his/ her testimony and to make sure that the minor child fully understands the oath. The Judge or Magistrate interviews the child to establish if he/she is competent to give evidence. This generally takes place in Judges’ chambers or in closed court rooms.

 

How must the court deal with the evidence?

Once competency is established the court will allow the minor child to lead evidence in court. The Criminal Law Amendment (Sexual Offences Act) 32 of 2007 enacted certain rules about how the court must deal with evidence of a child complainant in sexual matters when the court is evaluating the evidence of a child.

In S v QN 2012 (1) SACR 380 T the court remarked that it is not improper to rely on the evidence of a minor child. In doing this the court should look at whether, the child was clear and satisfactory in all material aspects.

 

Children as young as 4 years can testify in court whereas in some cases you find that the child is too young and immature to give evidence in court. You might notice that in criminal cases matters court will proceed in closed court or have the perpetrator removed from court to enable the child to give evidence without any fear. A social worker must also be appointed to assist in sexual offences involving a minor child to take the child into an isolation room and allow the child to demonstrate and tell what really took place on the day of the incident. Such evidence is recorded and used in court.

In all essence a minor child can testify as a witness in court provided the above requirements are met. Protect a child and prevent crime.

Should you have any questions do not hesitate to call us on 031 003 0630 or email Jessica@schwenninc.co.za

Written by: Portia Dlamini

On the 2nd of June 2020 the Gauteng High Court handed down judgment declaring that the regulations under alert level 3 and 4 to be unconstitutional but many people are left confused wondering:

  1. What does that mean for me and my family?;
  2. How did this come about? and
  3. What are the consequences if any of such a judgment?.

It is important to start, like any story, at the beginning and the same can be said when it comes to the enactment of laws and regulations.

Who makes laws in South Africa:

Parliament has the necessary legislative powers to make law, amend laws, and repeal laws. These laws however are voted on by parliament as a whole and need cabinet approval before they can come into existence. Most laws have to go through a strict step by step process before they are enacted.

How were the regulations under alert level 3 and 4 enacted?

The state of disaster which was declared by the President this allowed the government to enact the regulations under the Disaster Management Act.

These regulations were unilaterally enacted. Meaning it skipped the normal strict process of enactment due to the fact that it was an emergency situation and there was no time for due process.

Why the regulations were considered to be unconstitutional:

In certain instances, the government can limit citizens right under the constitution if such limitation is rational.

However, the court, in this case, has found that these regulations limit citizens rights to an extent that is not rational and can be seen as contradictory such as (to list a few):

  1. You can walk on the promenade which can be classified as exercise but you cannot be on the actual sand or in the sea itself;
  2. You cannot visit with your close or immediate family members but you can attend their funeral when they die;
  3. You are allowed out in public to exercise but only between the hours of 5 am-9 am.

What happens now:

The minister has 14 days from date of judgment to make the necessary changes to the regulations to abide by the court’s decision however, it is important to note that the minister can appeal this decision to a full bench of the High Court or take the matter to the Supreme Court of Appeal for hearing.

For now though as citizens we are to abide by the regulations until we are told otherwise because at present those are the laws still before us.

Reining of power by the government:

There is a very interesting interview done on 5fm radio with Eitan Stern from Legalese where he outlines governments power to sometimes to do as they deem fit without fully taking into account the citizens of the country and likened his example loosely on what is happening in the United States where the government is forcing police and military to break up protests against racial violence which in effect is creating more violence.

He states that although the two countries are in two very different situations the use of power used by the government, although the intentions may be good for its citizens, has in many circumstances made the relationship of trust with citizens and government worse.

This can be seen in our country by the lack of communication, the executive decisions by the National Comand Council, and the gross misuse of power by certain ministers.

If you would like more news on what is happening in our country and any laws you may be confused about please feel free to contact us today on 031 003 0630 or email us at Charmaine@schwenninc.co.za .

 

 

 

 

Section 26 of the Constitution:

This section stipulates that everyone has the right to access adequate housing and that it is the duty of the state to provide its people with the necessary resources to have said access.

We, however, know that in South Africa there is already a high percentage of our population that do not have adequate housing and we also know that our government does not have the necessary resources to rectify this epidemic.

With COVID 19 on the rise and many people being retrenched the number of evictions and homelessness it seems will only increase.

Rental Collection:

In normal situations, there are two or more parties to a lease agreement whether it be commercial or residential. If the tenant defaults on their monthly payments the owner would give notice of default, place the tenant in breach, cancel the agreement, and then would sue the tenant for arrear rental.

However, these times are different in that no one could have foreseen the possibility of a virus affecting our lives so suddenly and having such a drastic impact.

Within a contact, there may be two clauses that make provision for such unforeseen circumstances.

  1. Force Majeure: This is an act of God, one that neither the tenant nor the owner had any control over. Because of this act, no one could go to work and earn an income and therefore could not pay rent or meet their other financial obligations.

 

  1. Supervening impossibility: This is an impossibility to act either physically or legally. One cannot work during lockdown and alert levels or be vacated at certain times legally due to the regulations given by the government.

Solutions to non- payment:

Your agreement should lead you in terms of the path you can take however, these are difficult times and in saying that this leaves the door to communication and negotiation to take place. The following have been brought up lately as the main solutions:

  1. Deposit utilization: Using the deposit the tenant put down that is usually returned if no damage to the property is found when they vacate the premises. This can be used in the place of rent.

 

  1. Deferment of rent: Some refer to this as a payment holiday. This essentially just means that for a period of time you will be on a reduced payment plan or in some cases will be granted to not pay anything depending on your financial circumstances. This “holiday” however will ultimately increase your payment period and increase your interest on your payments in the long run especially for those who have bonds.

It is important that everything is agreed in writing between the parties and that there is compromise during this time as litigation will indefinitely be expensive if not solved amicably.

Evictions:

Previously the Disaster Management Act had stated that during lockdown no one could be removed from premises, this has since been repealed.

According to Regulation 19 of the Act one can Evict a tenant at any time however said eviction will have to be stayed until the end of alert level 4 which has yet to be announced and will need to be stated in the PIE application.

For any questions on property law whether you are a tenant or an owner please contact us on Charmaine@schwenninc.co.za or call us on 031 003 0630.

The disappearance of a person creates a big problem namely because:

  1. An estate would need to be administered;
  2. Heirs may require inheritance at some point or another; and
  3. The missing person’s spouse may want to remarry.

In the first case, one would need to apply to the High Court for an appointment of a Curator Bonis to oversee and distribute the estate of the missing person while the person is missing. However, for the last two scenarios, which presume the death of the person, you would need to make an application to the High court for an order that the missing person is to be presumed to be dead.

The Presumption of death can be done in two ways:

  1. In terms of the Common law: where any person living in the area of the missing must prove on a balance of probabilities that the person is dead; or
  2. In terms of Statutory law: which would allow the court to state that the person died of unnatural causes

South African Courts unlike English Courts don’t solely look at the period of time that someone is missing but look at many factors which someone went missing such as:

  1. The circumstances which the person disappeared;
  2. The period of time they have been missing for;
  3. Age of the missing person; and
  4. The health of the person.

It is important to note that this order is rebuttable and can be set aside as it is a presumption of death and not a guarantee of death.

It is also to be kept in mind that there are consequences to the order of presumption of death such as:

  1. When inheriting, heirs must pay over security in case the missing person returns, this includes payments from life policies; and
  2. Spouses who want to remarry have to apply for a dissolution of the marriage by an order of the court as the presumption of death in no way dissolves the marriage of the missing person and their spouse.

For more information on the law of persons please contact our offices today on 031 003 0630 or email us at Charmaine@schwenninc.co.za

 

After the announcement that our country might go on a lockdown a few businesses, retail shops and companies have been engaging in the practice of price increment and excessive charging of goods and services. This is based on the fact that most goods and services have been on higher demand as people are preparing for the lockdown. The excessive charging of goods has been mostly spotted on food items and cleaning essentials including bath soaps and sanitizers.

Fairness

The Competition Commission promotes a fair, accessible and sustainable market for consumer products and services and the Consumer Protection Act prohibits certain unfair marketing business practices.

Prohibitions

Suppliers are not permitted to charge unfair prices for the same goods and services as this allows competitors in the market to agree on price-fixing rather than competing with each other. As a consumer, you have the right to be treated equally, irrespective of gender, race, socio-economic status or geographical location.

Your Right to fairness

Your right to fair and reasonable prices gives rise to your right to lodge a complaint against any business or company unfairly charging excessive prices and misleading consumers as means of competition or making up for the loss on quite seasons. The National Consumer Commission in connection with the Equality Court allows for consumers to approach it for complaints against prohibited and unfair practices.

Reporting cases

Should you find yourself facing a situation of unfair excessive pricing of goods, the Competition Commission has appealed that each consumer faced with the situation should not hesitate to report each case of unfair treatment against consumers. Our firm promotes equality and fair treatment of consumers.

For more information contact Charmaine on charmaine@schwenninc.co.za.

 

Written by Portia Dlamini.

Have you considered how COVID – 19 (or “Coronavirus“) affects any of your contracts in place?

Have you considered how COVID – 19 (or “Coronavirus“) affects any of your contracts in place?

 

The last thing that you want is issues with breach of contract on technicalities when we are all working so hard to keep our heads above water and our health in tact!

 

Some gremlins to look out for – what if…

 

  1. Building contracts eg. A building contract that requires site meetings and these are suspended or made into virtual meetings?

We would recommend a minor addendum to be signed so everyone knows where they stand.

  1. Contractual deliver dates : Suppliers or you run out of supplies and it affects your agreed delivery date? Does a penalty clause kick in and would now not be the time to review this?

 

  1. Employment law : you have your employees work remotely. We would recommend the signature of an addendum to the employment agreement that states when and how the employer can call the employee back to full time service at the work address.

 

  1. Debtor’s control – we know that tight times are coming. Now is the time to knuckle down on debtor handovers before your cashflow affects your firm permanently.

 

There’s a lot more to think of.  Contact us, we are a call or email away.

Charmaine Schwenn

charmaine@schwenninc.co.za

031-0030630

www.schwenninc.co.za

 

 

It’s alarming how quickly the COVID – 19 (or “Coronavirus“) is spreading.  Employers and employees need to do all they can to limit the impact of this on businesses, as our economy is already under severe strain!  Businesses need to stay open and keep doing business or else!

 

Here are some answers we have sourced to the most common questions being asked right now:

 

  1. What is an employee’s sick leave entitlement?

The Basic Conditions of Employment Act (“BCEA”) regulates sick leave entitlement.  Each permanent employee is entitled to a “sick leave cycle” – 36 months’ employment with the same employer.   During every sick leave cycle, an employee is entitled to an amount of paid sick leave equal to the number of days the employee would normally work during a period of six weeks.  Usually (for an employee who works 5 days a week) this equates to 30 days’ sick leave per 36 months of employment.

  1. Must an employee be paid for sick leave?

An employer must pay an employee for sick leave: a) the wage the employee would ordinarily have received for work on that day; and b) on the employee’s usual pay day.

  1. When is an employer not required to pay sick leave?

An employer is not required to pay an employee for sick leave if the employee has been absent from work for more than two consecutive days or on more than two occasions during an eight-week period and, on request by the employer, does not produce a medical certificate stating that the employee was unable to work for the duration of the employee’s absence on account of sickness or injury.

  1. What are the basic requirements for the medical certificate?

The medical certificate must be issued and signed by a medical practitioner or any other person who is certified to diagnose and treat patients and who is registered with a professional council.

  1. What if sick leave is exhausted?

An employer is not required to pay employees for sick leave taken when the sick leave entitlement has been exhausted. However, we recommend that authorised unpaid leave be considered. In those instances, the employee must claim illness benefits in terms of the Unemployment Insurance Act 63 of 2001 (“UIA“).  In terms of section 20 of the UIA, a contributor is entitled to the illness benefits contemplated in the UIA for any period of illness if, inter alia, the contributor is unable to perform work on account of illness.

  1. When can an employee be dismissed due to the Coronavirus?

In terms of Schedule 8: Code of Good Practice Dismissals, an employer must investigate the extent of the illness if the employee is temporarily unable to work. If the illness may result in a prolonged absence from work, alternatives to a dismissal must first be considered.  The factors to take into account in considering alternatives to dismissal include, the seriousness of the illness, the period of absence, the nature of the employee’s job and whether a temporary replacement may be secured.  During this process, the ill employee should be given an opportunity to make recommendations as well.  Only once all these processes have been followed and no alternative to dismissal found, an employer may consider dismissal.

  1. May employers consider retrenchments due to the impact of the Coronavirus?

Section 189 of the Labour Relations Act 66 of 1995 applies if an employer contemplates dismissing one or more of its employees for reasons based on its operational requirements.  “Operational requirements” is defined as requirements based on the economic, technological, structural or similar needs of the employer.

A retrenchment is as a result of no fault on the part of the employee.  In the circumstances, it is not an opportunity for an employer to terminate the employment of ill employees.

At this point, the Coronavirus is unlikely to trigger an operational need.  The recommended period for recovery/isolation is 14 days – this in itself cannot trigger a need to retrench.  However, should a large number of employees be infected, an operational need could possibly arise in future.

  1. What can be done about employees who refuse to come to work?

Employees remain obligated to come to work, unless instructed otherwise by their employers.  Employees who refuse to come to work must have a valid reason for their absence.  The mere presence of the Coronavirus in South Africa does not constitute a valid reason to stay away from work.  Employees who stay away from work without a valid reason, may face disciplinary action..  We encourage employees to rather speak to their employers about their concerns before making a decision to stay at home, without authorisation.

  1. Do employees have the right to work from home?

Employees do not have a right to work from home. Working from home may be considered by employers but should not be implemented by employees without the employer’s consent. We encourage employees to rather speak to their employers about their concerns.

  1. May employees be required to work from home?

Yes.  Working from home may be permitted in the discretion of the employer.  This is not always viable but could be considered in a corporate environment.  Should employers consider this option, we recommend that clear guidelines be set for employees.  This may include that the working environment must be safe, the employee must have a secure telephone line and Wi-Fi connection and employees should remain within travelling distance of the office.

  1. May an employee’s professional or personal travel plans be restricted?

Professional travel plans may be changed or prohibited.  However, an employer does not have the right to dictate whether an employee may travel during his/her annual leave or weekends. Employers may, however, require their employees to disclose if they have travelled to any specific locations in order for the employer to assess the risk to other employees or customers.

  1. As an employer, what are my obligations?

The Occupational Health and Safety Act 85 of 1993 (“OHSA“), requires an employer to bring about and maintain, as far as reasonably practicable, a working environment that is safe and without risk to the health of its employees.  For this reason, we recommend that employers adopt contingency plans and communicate with its employees regarding the measures it will adopt in securing the workplace.  This may include –

  • the prohibition of handshakes or physical contact;
  • limitation on meetings;
  • sufficient supply of hand sanitizer; or
  • requiring employees to work from home, should they feel sick in any way.

It may also be necessary to relax the sick leave policy or to permit more flexibility in working arrangements.

  1. As an employee, what are my obligations?

The employee and the employer share the responsibility for health in the workplace. Therefore both the employee and employer must pro-actively identify dangers and develop control measures to make the workplace safe.  For this reason, employees should abide by any policies adopted by the employer to curb the spread of the Coronavirus.  Employees should also inform their employer if they are aware of any risk to the health of their colleagues.

  1. Practical Tips

The following practical tips may be considered:

14.1  The prohibition of unnecessary meetings and the increased use of video conferencing facilities.

14.2  The prohibition of any form of physical contact, specifically hugs and handshakes.

14.3  Requiring employees to report to their manager if they feel unwell in order to possibly allow that employee to work from home.

14.4  Requiring employees to disclose if they have travelled to a high-risk area recently.

14.5  A rule that requires employees to wash their hands regularly.

*The answers to these questions are always subject to the specific facts of each matter and we recommend that you contact an employment law expert for advice applicable to your facts.

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