An important debate is being had in the pages of the Daily Maverick about whether the Expropriation Bill, in particular its provisions allowing the confiscation of property without compensation, may be enacted and operationalised before the Constitution is amended, by way of the Constitution 18th Amendment Bill (Amendment Bill), to remove the unqualified right to receive compensation upon the expropriation of property.

Opinionista Pam Saxby argued that the constitutional amendment must precede the ordinary legislation. A group of jurists then argued that it does not. We agree with Saxby, who has since written a fiery rejoinder.

Our concern with the jurists is focused on this crucial pillar of their argument:

“The constitutional compensation standard of ‘just and equitable’ is still intact, and the discretion is still there to decide when it will be just and equitable to pay nil. … The [Amendment] Bill just states what is legally possible, in terms of section 25 as it currently stands, without any amendment.”

In other words, “nil rands” compensation may be paid under certain, just and equitable circumstances, already, under section 25 of the Constitution as it presently stands.

Confiscation, not expropriation

First, we should clarify a few things about our perspective.

The first is that we do not believe we are dealing with “expropriation” at all, but with “confiscation”. There is virtual unanimity that expropriation always involves the payment of compensation. Even before the first legal instrument to require compensation, the American Bill of Rights, was established in 1789, it was widely taken as given that when the government needed to take private property by law for some public purpose, it would recompense the person whose property is taken.

The reason for this is exceedingly simple, but remains widely unrecognised: expropriation is not a tool of justice or punishment. It is a last resort invocable only when a government, responsible to the whole society and not only to the owners of the property in question, has no other choice but to seize such property for some social improvement. It is not about being able to undermine the owners, to send a message, to let justice be done, or anything like that.

As such, the owners, having done no wrong, even if their property is completely and utterly worthless in the marketplace, must be adequately compensated. Adequate compensation means the owners must receive the market value of their property in addition to what is called solatium, effectively payment for inconvenience — an apology by the government that it had to burden the owners in this drastic but unavoidable way. Solatium cannot be insignificant, particularly if the property in question has a low or effectively no value in the market. The property still had value to the owners, hence why they have not sold or given it away.

Long story short: expropriation is not a political tool that may be used to settle scores, whether present or historical scores, but a tool for social improvement. Compensation upon expropriation is required (indeed per definition) because the owners are not blameworthy for anything, and governments are ordinarily expected to respect property rights, not ride roughshod over them.

What the South African government is proposing, evidently then, is not expropriation. It wants to address an “original sin” — it thinks owners have demanded too much compensation in the past, and it rambles on about a particularly perverse conception of justice. The government, in other words, has a score to settle. They are out to “get” those exploitative landlords and owners by, under certain circumstances, leaving them penniless, and they will use what is commonly known as expropriation to do it.

But this is simply confiscation. Expropriation does not enter into the equation when compensation is off the table or when the institution is used as a political tool.

Basic structure of the Constitution

The second is that while we regard it as important for the Constitution to be amended first before the Expropriation Bill can be enacted, we think the Constitution 18th Amendment Bill itself is also unconstitutional.

Parliament’s own lawyers, the Constitutional and Legal Services Office (CLSO), have admitted that “expropriation without compensation” offends what is called the “basic structure” of the Constitution — its internal principles and logic — and that trying to bring such a notion into the Constitution would therefore fail. The CLSO, like the previous authors, however, think that there is a difference between “expropriation without compensation” and “expropriation where the amount of compensation is nil”.

Yes, our eyebrows are also raised at this. It is our view that, outside of the legal academy, this is a distinction without a difference. The form of something, in our constitutional dispensation, can never outweigh its substance, and in substance, in fact, in reality, seizing Person A’s private property “without compensation” and seizing it by “paying an amount of R0.00 compensation” is exactly the same thing.

In summary, therefore, we regard the whole scheme that the government proposes, from top to bottom, from the constitutional amendment to the ordinary legislation, as a legal impossibility. It is inherently poisonous to law, and it will, if adopted, only apparently be law, much like the laws of the old apartheid regime, rather than being real, respectable law that demands conscientious obedience.

Where does ‘make explicit what is already implicit’ come from?

It is no surprise that various eminent legal scholars have put their names to the argument raised by the previous authors. The impulse is understandable, even respectable.

Good constitutionalists do not want the constitutional text to be needlessly tinkered with, particularly when it is for passing, temporary political expedience. Constitutions only truly prove their mettle if they can go for long periods of time without necessitating radical changes. That is why many people know something about the Constitution of the United States of America, and few around the world know anything about the Constitution of Haiti.

In our view, this is a big part of the reason why so many legal academics have since December 2017 come out of the woodwork trying to compromise with the government on confiscation without compensation.

It is not really necessary to amend the Constitution, the argument goes, because what the government wants is already there, hidden and implicit. All the government needs to do is enact an ordinary piece of legislation, the Expropriation Bill, which gives the government officials the peace of mind that they may, in fact, expropriate property without transferring any money into the bank accounts of the victims of their predation. The government gets what it wants, and the Constitution remains intact; everybody wins. This is the sentiment we get from the jurists who advance this argument.

We naturally agree that the Constitution ought not be amended; certainly not for the purpose the government presently has in mind. But it is entirely unclear why our constitutional supremacy and integrity must be sacrificed to a group of political opportunists. The Constitution as it was adopted in 1996 is fundamentally a good (but imperfect) constitution, and its good content must receive a heartfelt defence by the legal community. We do not see it as necessary to have to compromise with the government on such an important question that could make or break our entire society economically.

Why the constitutional amendment must precede the Expropriation Bill

We turn now to why we regard the previous authors’ argument as fundamentally incorrect.

It cannot, in our view, be argued that “nil”, being the “amount” “paid” in “compensation” for expropriation, is a possibility under South Africa’s present constitutional arrangement. As the previous authors rightly point out, the Constitution was written in plain language, and indeed the language of the Constitution must be construed in line with its plain understanding by ordinary South Africans. The Constitution was not written for jurists and legal practitioners, but for the millions of everyday people who fall under its protection.

As such, when an ordinary person reads in the pre-amended sections 25(2) and (3) of the Constitution that expropriation may only take place subject to the “payment” of an “amount” of “compensation”, they obviously do not walk away under the impression that “receiving” R0.00 (nothing) could ever be akin to being compensated for the loss of their property. Outside of the ivory tower of academic jurisprudence, when you tell someone you are going to “compensate” them, you are going to “pay” them, and your payment will be an “amount” (understood universally as meaning an amount of money), they will not understand that to include the possibility of getting nothing.

The etymology of “compensation” is of relevance in this context. It is derived from the Latin compensatio (compēnsō +‎ tiō), as a verb, to mean “make up for”, or “offset”, “balancing”. In other words, in context, to make right a loss — bring balance back to a disrupted equation.

How is Person A’s loss made right after receiving R0.00? Bear in mind, the just and equitable standard found in section 25(3), and the list of factors thereunder that must guide a court in arriving at a just and equitable amount, makes no difference to the fact that there must be compensation. The compensation could be higher, or it could be lower, but it cannot be absent, or so low as to in substance be absent. In other words, no matter the facts, no matter the circumstances, the government must make up for, must make right the loss, that Person A has suffered. This is compensation.

Furthermore, section 25(3) of the Constitution, as it stands, lists broad and non-political circumstances that must be taken into account to determine just and equitable compensation for an expropriation. What section 12(3) of the Expropriation Bill does, on the other hand, is to list specified conditions where it can be deemed just and equitable for property to be confiscated without compensation. This would supplant the courts’ autonomy to take into account the general circumstances in section 25(3) of the Constitution when determining a just and equitable outcome, and to replace it with politically crafted circumstances where it will be expected of the court to find that “nil” compensation is just and equitable in the circumstances.

In a way, one can imagine that the ANC had very specific landowners in mind when it put these targeted circumstances in the bill. If the premise of “nil compensation” is accepted — and we submit it ought not be — then we submit that the courts’ discretion to determine a just and equitable outcome at the hand of general factors must be left intact, without some legislative instrument enforcing a tunnel-vision approach that, in reality, could never yield a just and equitable outcome.

Land reform has unfortunately become extremely politicised. The result is that the admirable land reform objectives presently ensconced in section 25 have been used by opportunistic politicians to provide a smokescreen for a naked power grab. With the enactment of the Expropriation Bill, in other words, we should expect nothing less than the determination of “just and equitable” compensation being at least in part a political determination. Section 25’s purpose is to protect property rights — with the justice of restitution being an inseverable part of property rights — regardless of who happens to occupy the highest political offices. The approach to expropriation that is adopted in the Amendment Bill and the Expropriation Bill makes who is presently in government a very relevant consideration.

An example of the brazen politicisation of land reform and expropriation is the inclusion of land held for speculative purposes being an open target for confiscation without compensation in terms of the Expropriation Bill. It has long been recognised that speculating with land value is a valid enterprise. It is not harmful to anyone — there is no shortage of agricultural property for sale in South Africa — and is done by owners on their own property, the very institution section 25 is meant to protect. If anything is to qualify as land reform in South Africa, it is allowing owners to be unmolested in the use of their property — something the apartheid government did not tolerate for a moment.

It is, unfortunately, disingenuous to suppose that it has always been “implicit” in the Constitution that land speculators were liable to have their property confiscated without compensation. Land speculation would not have happened in South Africa up to now were this the case. It would, indeed, be necessary to amend the Constitution before such an event could resemble lawfulness.

The inevitable conclusion we are left with is that before the Expropriation Bill can be enacted and brought into operation, the Constitution 18th Amendment Bill must first be enacted so that the unqualified right to compensation in the Constitution is changed. This will be a travesty in itself, however, and for the reasons we mentioned above will itself be unconstitutional.

But it is the necessary step that Parliament must take if it intends to proceed with its destruction of our constitutional order. DM

Martin van Staden is a Legal Fellow and Tian Alberts a Legal Officer at the independent business community Sakeliga. Van Staden is pursuing a doctorate in constitutional law at the University of Pretoria, where he also has a Master of Laws (cum laude), and Alberts is pursuing a Master of Laws at Stellenbosch University.