Barnard and Others v Registrar of Medical Schemes (628/13) [2014] ZASCA 111; 2015 (3) SA 204 (SCA) (16 September 2014)

Barnard and Others v Registrar of Medical Schemes (628/13) [2014] ZASCA 111; 2015 (3) SA 204 (SCA) (16 September 2014)

The Supreme Court of Appeal found that the cumulative effect of the material irregularities in the management and governance of Medshield Medical Scheme justified the appointment of a curator. The evidence demonstrated unlawful payments to unaccredited brokers, contracts that diverted millions of rand to third parties without benefiting the scheme, disregard for scheme rules in trustee appointments, and persistent non-compliance with regulatory directives. The election of trustees was orchestrated to serve the interests of Sapling, a service provider, which compromised the independence of the Board of Trustees. The trustees failed to address regulatory concerns and obstructed...

Citation
[2014] ZASCA 111
Parties
Appellant: Francois Barnard; Appellant: Thabo Pandleton Mabeta; Appellant: Bisnath (Jay) Singh; Appellant: Gavin John Griffen; Appellant: Michael Wright; Appellant: Mark Dawson; Appellant: Amelia Holland; Appellant: Eben Lofty van Wyk; Appellant: Petrus Johannes Kriel; Appellant: Francois Albert Pieterse; Respondent: Registrar of Medical Schemes
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
16 September 2014
Case Number
628/13
Procedural Posture
Civil Appeal / Appeal From North Gauteng High Court, Pretoria; Confirmation of Curatorship Order
Outcome
Appeal dismissed; order of curatorship confirmed.
Judges
Mpati, Lewis, Pillay, Schoeman, Fourie
Legal Topics
Medical Schemes Act, Curatorship, Governance Irregularities, Conflict of Interest, Removal of Trustees, Regulatory Compliance
Administrative Law Civil Procedure Commercial and Corporate Medical Schemes Act Curatorship Governance Irregularities Conflict of Interest Removal of Trustees +1 more

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Parties

Francois Barnard

Appellant

Thabo Pandleton Mabeta

Appellant

Bisnath (Jay) Singh

Appellant

Gavin John Griffen

Appellant

Michael Wright

Appellant

Mark Dawson

Appellant

Amelia Holland

Appellant

Eben Lofty van Wyk

Appellant

Petrus Johannes Kriel

Appellant

Francois Albert Pieterse

Appellant

Registrar of Medical Schemes

Respondent

Procedural Posture

Civil Appeal / Appeal From North Gauteng High Court, Pretoria; Confirmation of Curatorship Order

Legal Issues

  1. 1 Whether material irregularities justified the appointment of a curator to the medical scheme.
  2. 2 Whether the trustees acted in breach of statutory and governance obligations under the Medical Schemes Act.
  3. 3 Whether less intrusive remedies were available to address the registrar's concerns.

Ratio Decidendi

The Supreme Court of Appeal found that the cumulative effect of the material irregularities in the management and governance of Medshield Medical Scheme justified the appointment of a curator. The evidence demonstrated unlawful payments to unaccredited brokers, contracts that diverted millions of rand to third parties without benefiting the scheme, disregard for scheme rules in trustee appointments, and persistent non-compliance with regulatory directives. The election of trustees was orchestrated to serve the interests of Sapling, a service provider, which compromised the independence of the Board of Trustees. The trustees failed to address regulatory concerns and obstructed...

Court Disposition

Appeal dismissed; order of curatorship confirmed.

Orders

  • The appeal is dismissed with costs, including the costs of two counsel, where employed.