Minister of Justice and Constitutional Development and Another v South African Restructuring and Insolvency Practitioners Association and Others

The Minister of Justice, acting under s 158(2) of the Insolvency Act 24 of 1936 and corresponding provisions of the Companies Act 61 of 1973 and Close Corporations Act 69 of 1984, issued a policy regulating the appointment of insolvency practitioners (trustees and liquidators). The policy required Masters of the High Court to appoint practitioners strictly according to a rotational quota system based on race, gender and date of citizenship (categories A–D in a 4:3:2:1 ratio), arranged alphabetically, with very limited discretion. Industry bodies and other interested parties challenged the policy in the Western Cape High Court, arguing that it infringed equality rights, unlawfully fettered the Master’s statutory discretion, was ultra vires the empowering legislation, and was irrational. The High Court declared the policy unconstitutional and invalid. The Minister and Chief Master appealed to the Supreme Court of Appeal.

The appeal was dismissed with costs, including the costs of two counsel, and the High Court order declaring the policy unlawful, unconstitutional and invalid was confirmed.

The case is a leading authority on the constitutional limits of affirmative action and transformation measures in South African administrative law. It confirms that remedial measures under s 9(2) of the Constitution must be rational, flexible and consistent with empowering legislation, and may not impose rigid quotas or mechanically override statutory discretion. The judgment is particularly significant for the insolvency profession and for the design of transformation policies across the public administration.