Public Protector Busisiwe Mkhwebane and her office will take the brunt of the storm after the apex court in the country on Monday morning delivered a critical and stringent judgment focused on her conduct in the contentious Bankorp/ABSA report.
Mkhwebane must pay 15% of the South African Reserve Bank’s (SARB’s) legal costs because she was biased and did not fully understand her constitutional duty to be impartial and to perform her functions without fear, favour or prejudice, a majority judgment written by Justices Sisi Khampepe and Leona Theron found.
(A dissenting view by Chief Justice Mogoeng Mogoeng and Acting Judge Patricia Goliath argued that the personal punitive costs order must be set aside.)
“The Public Protector’s conduct in the High Court warranted a de bonis propriis (personal) costs order against her because she acted in bad faith and in a grossly unreasonable manner… The Public Protector’s entire model of investigation was flawed. She was not honest about her engagement during the investigation. In addition, she failed to engage with the parties directly affected by her new remedial action before she published her final report. This type of conduct falls far short of the high standards required of her office”, the judgment found.
The question before the Constitutional Court was Mkhwebane’s appeal against the personal cost order, as well as against the stinging paragraphs underlying this judgment written by a full bench in the High Court in Gauteng in 2018.
The SARB’s cross-appeal asking for a declarator stating Mkhwebane abused her office in conducting the Bankorp/ABSA investigation, was dismissed. (Not because Mkhwebane was found to not have abused her office — the Constitutional court said it couldn’t make such a judgment because it did not have the benefit of the merits underpinning such a case.)
Nevertheless, the ink wasn’t yet dry on the judgment when non-profit organisation Accountability Now wrote to the Legal Practice Council, asking that Mkhwebane be scrapped from the roll as an advocate for lying to the court and having acted in bad faith, resulting in a serious credibility and integrity crisis for Mkhwebane and her office.
The judgment also opened the door for a second cost order: In another case — DA vs Public Protector in Mkhwebane’s equally failed Estina report — the High Court has been waiting for the Constitutional Court before deciding on whether it will afford an another personal costs order against Mkhwebane.
Such an order now seems to be inevitable.
On the political front, this is also a win for Mkhwebane’s detractors. The pending review applications of Minister of Public Enterprises Pravin Gordhan and President Cyril Ramaphosa would benefit from Mkhwebane already having been found biased, unfair and to not fully understand her constitutional duty to be impartial and to perform her functions without fear, favour or prejudice.
Speaking of a constitutional delinquent: Monday’s judgment poses difficulties for the EFF, too. Calling Gordhan a “constitutional delinquent” may have been fairly effective in a way that it slowly chipped away at Gordhan’s credibility and that of the president. It is a tactic that worked very well on former president Jacob Zuma before. The apex court has, however, now all but labelled Mkhwebane a constitutional delinquent. It matters because the EFF’s tactics employed against Gordhan and Ramaphosa are mostly based on Mkhwebane’s findings.
The EFF also has a not a small issue of its own 16 February 2018 statement:
“If this important office is to have integrity it cannot be occupied by people who lie or are misleading. Above all, who are impartial (sic) and hell-bent on undermining the mandate of the office and the Constitution. We call on her to step down with immediate effect; this judgment means she has failed in her duty.”
The DA’s Mmusi Maimane may sit with a similar conundrum. He laid the complaint against Ramaphosa, but also wants Mkhwebane gone. Ramaphosa’s weakened position is at this stage much dependent on the credibility of Mkhwebane. The DA will have to find a way to show that the allegations against Ramaphosa have their own legs — that Ramaphosa can be corrupt and Mkhwebane can be unfit for office, and that the two “facts” are not mutually exclusive.
Mkhwebane attended the reading of the judgment and told journalists after proceedings that “I never told any falsehoods”. She knows “quite well” that she cannot appeal against the apex court’s judgment, and didn’t want to be pushed on the fact that she was found to have acted in bad faith.
“This is a far-reaching judgment that will negatively impact other Public Protectors,” she said.
Personal costs order on a punitive scale
Personal and punitive costs orders are extraordinary in nature and should not be awarded willy-nilly, the Constitutional Court said, “but rather only in exceptional circumstances”.
“The punitive costs mechanism exists to counteract reprehensible behaviour on the part of a litigant.”
It means the conduct concerned is “extraordinary” and worthy of rebuke, Justices Khampepe and Theron said.
Mkhwebane, on the other hand, argued that she may have acted with “unbridled zeal”, and said the recovery of public funds should be applauded, not met with punitive personal costs orders.
The majority judgment disagreed, finding as follows:
“Regard must be had to the higher standard of conduct expected from public officials, and the number of falsehoods that have been put forward by the Public Protector in the course of the litigation… The punitive aspect of the costs order therefore stands.”
The Constitutional Court’s judgment in Public Protector vs SARB
Fears that a costs order against a public official will have a chilling effect on the official in the exercise of their job should be quelled, the Constitutional Court said, because:
“This Court has repeatedly affirmed the principle that a public official who acts in a representative capacity may be ordered to pay costs out of their own pockets in certain circumstances… Costs orders are not granted against public officials who conduct themselves appropriately. They are granted when public officials fall egregiously short of what is required of them. There can be no fear or danger of a personal costs award where a public official acts in accordance with the standard of conduct required of them by the law and the Constitution.”
The only relevant question, therefore, is whether the High Court was wrong in concluding that the Public Protector did not act in good faith, and behaved in an unacceptable and secretive manner, Justices Khampepe and Theron said.
The majority judgment then continued to evaluate six points made in the High Court judgment in order to decide that the lower court came to the correct conclusion.
1. Immunity under section 5(3) of the Public Protector Act:
Mkhwebane said she is indemnified against personal cost orders by the section 5(3) of the Public Protector Act that says no member of the Public Protector’s Office shall be liable when they acted “in good faith”.
The Constitutional Court said that the “High Court found that the Public Protector acted in bad faith. This Court has no reason to interfere with this finding”.
2. Sufficient opportunity to be heard
Mkhwebane said the SARB did not properly ask for a personal costs order against her in its notice of motion, but only in its replying affidavit, and therefore the application was flawed.
The Constitutional Court disagreed, saying this was not necessary. Mkhwebane knew that the personal costs order had been asked for and had an opportunity to defend herself. That was sufficient, Khampepe and Theron said.
3. Wrong principle of law
Mkhwebane argued that the High Court mistakenly conflated the principles of “bias” and “to hear the other party — audi alteram partem”.
She argued that the High Court found she was biased because she did not afford the SARB and ABSA an equal opportunity to put their case forward after Mkhwebane met with then-president Jacob Zuma and then minister of state security David Mahlobo.
Mkhwebane says this was actually a question to be debated under the principle of “hearing the other party”, and therefore the High Court wrongly “found bias on an audi question”.
Justices Khampepe and Theron disagreed.
4. Misdirection of the facts
If the High Court made a mistake on the facts, it would be grounds for an appeals court to interfere, Mkhwebane argued.
However, the High Court held that Mkhwebane acted in bad faith, did not fully understand her constitutional duty to be impartial and perform her functions without fear, favour or prejudice, had failed to produce a full and complete record of the proceedings and was not frank and candid with the court. Justices Khampepe and Theron said these findings are “underpinned by various factual findings made by the High Court regarding the conduct of the Public Protector”.
5. Meetings with the Presidency and the State Security Agency
The Public Protector was obliged to provide a full and frank account of her conduct to the High Court, which had irked the SARB and ABSA. This included proper explanations about why she did not disclose meetings with the Presidency and the State Security Agency in her final report, why she held meetings with them, but did not afford the SARB and ABSA the same time, why she discussed amending the Constitution to take away the central function of the SARB with the Presidency and not with SARB experts, why she discussed the vulnerability of the SARB with State Security Agency and why she did not provide proper notes and transcriptions of these meetings to the court.
She did not.
The SARB was especially perturbed by a handwritten note posing the question “how are they vulnerable?” in a discussion about the central bank with David Mahlobo, and interpreted this as an attack on the bank.
Said the SARB in the argument:
“It is unclear on what possible basis the vulnerability (and vulnerability to whom) of the Reserve Bank was relevant to the Public Protector’s investigation into the CIEX report.”
Mkhwebane “ignored the serious concern”, Justices Khampepe and Theron said, and her belated attempt at an explanation made “no sense”.
In fact, the “Public Protector’s explanation of what was discussed (with Zuma and Mahlobo) is obscure”.
Mkhwebane dug her hole even deeper when she attempted to explain the situation to the Constitutional Court. She claimed to have been confused while filing court papers under pressure and claimed that the president asked her for a meeting when it seems that he did not.
It was in fact all “innocent errors”.
Justices Khampepe and Theron were unimpressed. Mkhwebane has after three attempts to explain the same meeting still “not come clean and frankly explained why the meeting was held”, their judgment found. Her explanations are “contradictory”.
Therefore, the “Public Protector’s conduct in the High Court warranted a de bonis propriis (personal) costs order against her because she acted in bad faith and in a grossly unreasonable manner… The Public Protector’s entire model of investigation was flawed. She was not honest about her engagement during the investigation. In addition, she failed to engage with the parties directly affected by her new remedial action before she published her final report. This type of conduct falls far short of the high standards required of her office”.
And finally #6 — Reliance on expert economic advice
Mkhwebane argued that the High Court made a mistake when it found that she had “pretended” that she had relied on the advice of economist Dr Tshepo Mokoka in compiling her Bankorp/ABSA report.
Whether Mkhwebane actually did consult and who she consulted is important because she claimed that she did consult an economic expert and the economic rationale of the Bankorp “lifeboat” was an important part of her investigation.
Mkhwebane fudged her explanations before the Constitutional Court so badly that Justices Khampepe and Theron again pointed out that they could not be true and that they were contradictory. DM