By Nurina Ally on 1 February 2014

The Constitutional Court has previously commented that the characterisation of a particular decision as being of an administrative nature is “something of a puzzle”.  In Motau, the Court is being asked to decipher one dimension of that puzzle.

The case concerns the scope of judicial review and raises the question of when conduct by an executive functionary should be characterised as administrative action.

On 8 August 2013, the Minister of Defence (“the Minister“) terminated the services of the Chairperson and Deputy Chairperson (“the respondents“) of the Board of Armaments Corporation of South Africa (“Armscor” or “the Corporation“)).

The Minister complained that the respondents’ leadership had led to critical failures in the ability of Armscor to achieve its objectives in terms of the Armaments Corporation of South Africa Limited Act, 2003 (“Armscor Act“). More specifically, the Minister pointed to the failure by the Armscor Board, under the leadership of the respondents, to (a) procure defence matériel necessary to meet the requirements of the Department of Defence effectively (as required by section 2(4) of the Armscor Act); and (b) conclude a Service Level Agreement with the Department (as required by section 5 of the Armscor Act).

In the circumstances, the Minister chose to act in terms of section 8 of the Armscor Act, which provides that the Minister may terminate the services of a member of the Board “on good cause shown”. Dissatisfied, the respondents launched an urgent challenge to the Minister’s decision.

In the High Court, Judge Legodi declared that the termination was unconstitutional, unlawful and invalid and set aside the decision. Legodi J made the following key findings:

a)      The Minister’s decision constituted administrative action and may be reviewed in terms of the Promotion of Administrative Justice Act, 2000 (“PAJA“).

b)      The Minister did not afford the respondents an opportunity to make representations regarding the proposed termination. This failure violated the respondents’ right to procedural fairness in terms of PAJA.

c)       Even if the decision was not of an administrative nature, the termination did not meet the requirements of legality. This was because the Minister had failed to show good cause justifying the dismissal of the respondents.

Legodi J was not convinced that there had been an irretrievable breakdown in trust between the Minister and the respondents. To the extent that the issues complained of by the Minister had any merit, the Board as a collective should have been held responsible and not the respondents in particular. As such, Legodi J expressed the opinion that the termination was irrational and, in singling out the respondents, seemed to be motivated by an ulterior purpose.

Appealing to the Constitutional Court, the Minister argues that her decision constitutes the exercise of executive powers and accordingly falls outside the scope of PAJA review. She contends that the termination was based on good cause and the High Court erred in finding that the decision was exercised irrationally. To support her case, the Minister relies on the Court’s previous decision in Masetlha v President of the Republic of South Africa and Another 2008 (1) SA 566 (CC).  In that case, the Court held that the dismissal by the President of the Director-General of the National Intelligence Agency was an executive function. As such, the decision was not subject to administrative review. In addition, the majority held that the break-down of the relationship of trust between the President and Mr Masetlha constituted a rational basis for dismissing the applicant from his post as Director-General of the Agency.  The Court will have to consider whether the Minister’s decision in this case is distinguishable from the nature of the power exercised in Masetlha.

[Note: At the time of posting, the respondents’ answer to the Minister was not available to the author. This post will be updated with a summary and analysis of the respondents’ submissions in due course.]