Giddey NO v JC Barnard and Partners (CCT65/05) [2006] ZACC 13; 2007 (5) SA 525 (CC); 2007 (2) BCLR 125 (CC) (1 September 2006)

Giddey NO v JC Barnard and Partners (CCT65/05) [2006] ZACC 13; 2007 (5) SA 525 (CC); 2007 (2) BCLR 125 (CC) (1 September 2006)

The Constitutional Court held that the discretion conferred by section 13 of the Companies Act to order security for costs must be exercised with due regard to the right of access to court under section 34 of the Constitution. However, section 13 is not unconstitutional and does not require a court to refuse security merely because it may terminate litigation. The balancing exercise requires consideration of the potential injustice to both parties, including whether the plaintiff has attempted to secure financial support and whether the defendant's conduct caused the plaintiff's financial difficulties. In this case, the applicant failed to provide clear evidence that an order for security...

Citation
[2006] ZACC 13
Parties
Applicant: Trevor B Giddey NO; Respondent: J C Barnard and Partners
Court
Constitutional Court
Jurisdiction
South Africa
Judgment Date
1 September 2006
Case Number
CCT65/05
Procedural Posture
Leave to Appeal / Application for Leave to Appeal to the Constitutional Court After Unsuccessful Appeals in the High Court and Supreme Court of Appeal.
Outcome
Application for leave to appeal granted; appeal dismissed.
Judges
O'Regan, Langa, Moseneke, Madala, Mokgoro, Nkabinde, Sachs, Skweyiya, Van der Westhuizen, Yacoob
Legal Topics
Security for Costs, Right of Access to Court, Companies Act Section 13, Judicial Discretion, Rule 47 Uniform Rules, Constitutional Limitation
Civil Procedure Commercial and Corporate Constitutional Law Security for Costs Right of Access to Court Companies Act Section 13 Judicial Discretion Rule 47 Uniform Rules +1 more

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Parties

Trevor B Giddey NO

Applicant

J C Barnard and Partners

Respondent

Procedural Posture

Leave to Appeal / Application for Leave to Appeal to the Constitutional Court After Unsuccessful Appeals in the High Court and Supreme Court of Appeal.

Legal Issues

  1. 1 Does an order for security for costs under section 13 of the Companies Act unjustifiably limit the right of access to court under section 34 of the Constitution?
  2. 2 What is the correct constitutional approach to the exercise of judicial discretion under section 13?
  3. 3 Should the Constitutional Court interfere with the High Court's exercise of discretion in ordering security for costs?

Ratio Decidendi

The Constitutional Court held that the discretion conferred by section 13 of the Companies Act to order security for costs must be exercised with due regard to the right of access to court under section 34 of the Constitution. However, section 13 is not unconstitutional and does not require a court to refuse security merely because it may terminate litigation. The balancing exercise requires consideration of the potential injustice to both parties, including whether the plaintiff has attempted to secure financial support and whether the defendant's conduct caused the plaintiff's financial difficulties. In this case, the applicant failed to provide clear evidence that an order for security...

Court Disposition

Application for leave to appeal granted; appeal dismissed.

Orders

  • The application for leave to appeal is granted.
  • The appeal is dismissed.