The first appellant was the MEC for Economic Development, Gauteng, and the second appellant was the Gauteng Growth and Development Agency (the Agency), a state-owned company established under the Gauteng Growth and Development Agency Act 5 of 2003. The respondents were appointed as board members of the Agency on 1 October 2021 by the MEC's predecessor for a three-year term. A dispute arose when the board completed a recruitment process for a Group Chief Executive Officer (GCEO) and recommended Mr Hamilton for appointment. However, the new MEC, who took office after a cabinet reshuffle, informed the board that she had her own preferred candidate for the position, who had not been interviewed or shortlisted. The board resisted, stating the preferred candidate did not meet minimum requirements. The relationship deteriorated through correspondence, with the MEC asserting her statutory powers under section 8 of the Act to appoint the GCEO and directing the board to restart the recruitment process. On 22 March 2023, the MEC required board members to submit written reasons by 17h00 on 23 March 2023 why they should not be removed. Only three of five respondents submitted representations. On 24 March 2023, the MEC terminated all respondents' directorships, citing irretrievable breakdown of trust. The respondents challenged this decision by way of review and sought interim relief to suspend the decision pending the finalization of the review. The high court (Nyathi J) granted the interim relief, reinstating the respondents and interdicting the MEC from appointing replacement board members, and ordered punitive costs on an attorney-client scale. The MEC appealed with leave of the high court.
1. The appeal is upheld with costs including the costs of two counsel, where so employed. 2. The order of the high court is set aside and replaced with the following order: '(a) The application is dismissed. (b) Costs shall follow the result of the relief sought in Part B of the notice of motion.'
1. An interim order is appealable where, despite its form, it is final in effect, makes definitive findings on the rights of parties, and disposes of a substantial portion of the relief claimed in the main proceedings. The interests of justice approach to appealability applies equally to the Supreme Court of Appeal as to the Constitutional Court. 2. An appeal is not moot where the judgment will have practical effects on the parties, including: (a) final pronouncements on parties' statutory powers with ongoing implications; (b) findings affecting eligibility for future appointments; and (c) findings of malice or improper motive that would prejudice a party in ongoing proceedings. 3. When hearing applications for interim relief, courts must not make final findings on matters that fall to be decided in the main application. The prima facie right that must be established is not merely the right to approach a court for review, but a right which, if not protected by interdict, would result in irreparable harm. 4. The requirements for an interim interdict are: (a) a prima facie right, even if open to some doubt; (b) injury actually committed or reasonably apprehended; (c) the balance of convenience favoring the applicant; and (d) the absence of similar protection by any other remedy. An applicant must establish reasonable prospects of success in the main proceedings. 5. Procedural fairness under section 3 of PAJA is contextual. What constitutes adequate notice and a reasonable opportunity to make representations depends on the circumstances of each case, including the extent of prior engagement and knowledge of the issues by the affected person. 6. Courts must exercise caution when granting interdicts that restrain the exercise of executive or legislative powers, carefully considering how the interdict will disrupt those functions and implicate the separation of powers. Such relief should only be granted in the clearest of cases where a proper and strong case has been made.
The Court made several notable obiter observations: 1. After leave to appeal to the Supreme Court of Appeal has been granted, the SCA becomes seized of all ancillary issues, including appealability. Accordingly, a subsequent order by the high court in section 18(2) proceedings declaring an order to be interim and not appealable cannot bind the SCA on the question of appealability. 2. The Court observed that the respondents' allegations of corruption against the MEC were "bald allegations without any factual bases" and noted that such serious allegations, apart from lacking foundation, "undoubtedly had the effect of further souring the relationship between the parties and removing any possibility of the level of cooperation which good corporate governance would demand." 3. The Court noted that while it found the respondents failed to establish prospects of success in the review, it did not need to finally determine this issue, stating: "For the purposes of this appeal, I need not put it any higher than this." This indicates the Court was mindful not to prejudge the review application while still being able to determine that interim relief should not have been granted. 4. The Court commented on the high court's approach, noting that although it "correctly summarised the legal requirements for interim relief," it then identified the wrong issue as central (namely the MEC's powers generally, rather than whether interim relief requirements were met) and proceeded to make final findings inappropriate for interim proceedings. 5. The Court noted that the high court expressed its "displeasure by way of a punitive costs order" based on findings that the MEC acted with ulterior motives, but these findings were made prematurely and impermissibly at the interim stage.
This judgment is significant for several reasons: 1. **Appealability**: It clarifies the modern approach to appealability of interim orders, confirming that form is not determinative and that orders interim in form may be appealable if final in effect. It applies the "interests of justice" approach established in Lebashe Investment Group, emphasizing that courts must consider the effect of orders, not merely their form. 2. **Mootness doctrine**: It provides guidance on when appeals will not be dismissed as moot, particularly where judgments make final findings affecting parties' rights beyond the immediate dispute, including reputational findings and findings affecting future relationships. 3. **Interim interdicts**: It reinforces the proper approach to applications for interim relief, emphasizing that courts hearing such applications must not make final findings on issues reserved for the main application. It clarifies that applicants must establish prima facie rights that, if not protected, would result in irreparable harm - not merely the right to approach a court for review. 4. **Procedural fairness**: It confirms that procedural fairness under PAJA is contextual and that what constitutes "adequate notice" and "reasonable opportunity" depends on the circumstances, including prior engagement between parties. 5. **Separation of powers**: It reinforces the principle from Urban Tolling Alliance that courts must exercise caution when granting interdicts that restrain executive or legislative powers, and should only do so in the clearest cases where a proper and strong case has been made. 6. **Administrative law**: It confirms that the power to appoint and terminate board members of state entities vested in MECs by statute includes the power to terminate such appointments where relationships have irretrievably broken down, subject to procedural fairness requirements. The case serves as an important reminder to high courts to maintain the distinction between interim and final relief and not to usurp the function of deciding review applications when hearing applications for interim interdicts.
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