Release From Curatorship in Asset Forfeiture Matters

The issue of asset forfeiture has long created a bone of contention between the public interests and one’s constitutional rights. Granted, the soaring crime levels in South Africa has necessitated tough measures by the State as a tool to combat said threats especially in terms of acts such as Prevention of Organised Crime Act 121 of 1998 (POCA). However, where individual constitutional rights are trampled in pursuit of law enforcement, we need to stand guard against encouraging an unjust regime. In light of circumstances where restraint orders are granted in terms of POCA, and charges have been withdrawn against the defendant, it should follow that an application for rescission ought to follow as a matter of course, and instituted accordingly in terms of S26(10), of POCA.

It is not an uncommon scenario where a curator has control of someone’s assets when their duty is no longer necessary. This could be prejudicial to an affected party. Exploiting this vulnerability in the system may cause hardship for those under curatorship. A major dilemma is striking a balance between the objectives of POCA and the rights of affected parties suspected of offences under POCA, without violating constitutional rights such as the right to property and the right not to be arbitrarily deprived of such property.

Moreover, in terms of POCA, a defendant is ”a person against whom a prosecution for an offence has been instituted, irrespective of whether he or she has been convicted or not, and includes a person referred to in section 25 (1) (b)” of POCA.

It was held in National Director of Public Prosecutions v Rautenbach and Others  2005 SACR 530 (SCA) at paragraphs 24 and 25 that:

“The purpose of a restraint order is to preserve property in the interim so that it will be available to be realised to the satisfaction of [a confiscation] order. A court from which such an order is sought is called upon to assess what might occur in the future…. a restraint order can only be made if there is indeed a reasonable possibility that both conviction and a confiscation will follow. This requires that the court be satisfied that the nature and tenor of available evidence indicates a reasonable possibility of conviction. It also requires – under separate consideration – that the available evidence points to a benefit arrived by the defendant from the offence (s) charged or to be charged and that a confiscation order will follow”.

                                                                                                (My emphasis)

Section 26(10)(a) of POCA prescribes the circumstances in which a High Court which made the restraint order may vary or rescind that order. In terms of section 26(10)(b) of POCAthe court is obliged to rescind the order when the proceedings against the defendant are concluded.

In National Director of Public Prosecutions v Phillips and Others 2005 (5) SA 265 (SCA) at para 17 it was stated that:

“The Court a quo, in coming to the conclusion it did, found that on a proper construction of s 26 of the Act it was free in the exercise of its inherent jurisdiction to rescind or vary a restraint order on good cause shown. It reasoned that a restraint order, unlike a confiscation order in terms of s 18, was interlocutory, that it was akin to and essentially the same as the interim interdict at common law sometimes referred to as an ‘anti-dissipation order’ which it regarded as susceptible to variation or rescission and that the Act did not manifest a clear intention to exclude the common law rule that such an order can be rescinded or varied on good cause shown.“[1]

When one considers these matters it is important to understand the difference between orders in terms of section 26 and 28 of POCA. Section 26 “has the effect of prohibiting any person, subject to certain conditions and exceptions, from dealing in any manner with property made subject to the order. Such a prohibition may, no doubt, in particular circumstances result in undue hardship”[2] and section 28 “makes provision for an order appointing a curator bonis, directing the surrender of the property in question to him or her and determining the latter’s powers in relation to that  property.”[3]

If a defendant wishes to pursue an application to vary or rescind a restraint order, it needs to be proven that there is sufficient cause to do so. This is the approach understood at common law. Once a restraint order is granted, prior to any conviction, barring any requirements for rescission or variation in terms of S26(10)(a) of POCA, a restraint order cannot be changed and therefore, the defendant is without access to the restrained assets, control or use of them. In essence, pending the conclusion of a trial or confiscation enquiry, the defendant is without recourse. The dire result of this is that in constitutional terms, the defendant may suffer grave financial implications as well as a deterioration of the assets as long as the matter drags on, without a just conclusion.

POCA allows for the High Court to grant a restrain order, naturally it would flow that the said court may on application vary or rescind the order. Section 26 (10) (a), is clear that if the said court is satisfied then “on application by a person affected by that order vary or rescind the restraint order or an order authorising the seizure of the property concerned or other ancillary order”. It is important for defendants to be aware that if charges have been withdrawn against him or her or the criminal trial has been concluded, that it is not automatic that the curatorship will fall away, an application must be brought to remove the curatorship, failing which the curatorship remains in place indefinitely.

Moreover, in Phillips and Others v NDPP 2006 (1) SA 505 (CC), the Constitutional Court held that ”section 26(10) of POCA was not capable of a construction that allowed the High Court, in the exercise of its inherent power, to set aside a restraint order on common law grounds.” It found that the subsection dealt with standing, and regulating substantive circumstances when the rescission of a restraint order made under POCA may be sought. The court further held that

”the approach of the Supreme Court of Appeal to section 26(10) of the Act, namely, that the grounds for the rescission of such orders constituted a closed list and that the High Court was not empowered to rescind a restraint order on grounds other than those specified in POCA, could not be faulted and given that there was no constitutional challenge to section 26(10), the Supreme Court of Appeal’s interpretation had to stand.”

The potential prejudice as well as the actual prejudice a defendant may suffer during restraint proceedings, pending the conclusion of the matter or confiscation proceedings, may be great, as defendants are essentially left without remedies. It is submitted that our courts should revisit the law during restraint proceedings and afford defendants an opportunity to reclaim restrained assets at a much earlier stage of the case. To do so otherwise would severely erode a defendant’s constitutionally-protected rights our laws hold so dear.

In essence, persons affected by a restraint order while under curatorship are deprived of their property rights and are prohibited from dealing with their property in any manner. Due to the subjective nature in granting of these orders, it is easy to trample on rights especially as there are no evident safeguards in POCA against a wholly subjective order. Thus, if an affected individual wishes to release themselves from curatorship under the aforesaid circumstances, it is inevitable that an application has to be made to court. While it is noted that section 26 is restricted to the clauses in POCA, there are alternative measures provided for in POCA to free oneself from the restrictions of curatorship, as mentioned.

By Dhahini Naidu (Director at Fairbridges Wertheim and Becker Attorneys), Zolani Dhlamini (Associate) and Kirshia Pillay (Candidate Attorney at Fairbridges Wertheim and Becker Attorneys).

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[1] National Director of Public Prosecutions v Phillips and Others 2005 (5) SA 265 (SCA) at para 17.

[2] Ibid at paragraph 22.

[3] Ibid.