THE BLOG
02/03/2018 10:42 SAST | Updated 02/03/2018 11:04 SAST

How The Constitutional Court May Still Save Property Rights

No society has ever existed under the rule of law without the existence of property rights; nor can it.

Stefan Schäfer, Lich for Wikimedia Commons

That individuals and communities must have the ability to keep and own things they have earned, found, bought or created, is necessary for any free and just society. Oppressive and poor nations are the ones that have gone against this absolute moral fact: Venezuela, North Korea, the Soviet Union, and Zimbabwe, to name but a few.

Parliament's vote to consider expropriation without compensation of property is perhaps the institution's worst deed since voting to implement apartheid decades ago. And now, like the judiciary had to do during the apartheid era, our courts need to again become the rational branch of government.

The Constitutional Court will be called upon again to correct the irresponsibility and recklessness of parliamentarians, if the Constitution is amended as appears intended. This time, the highest court will need to make a decision quite unlike those it made against Jacob Zuma's presidency, because the cases against Zuma and his government were often clear-cut, and the court could render its judgment without hesitation.

This time it will be different, not only because land reform is an emotional topic in South Africa, but also because of the court's less-than-stellar history on this very topic. In the 2013 Agri SA case, the Constitutional Court engaged in expropriation-by-interpretation when it sanctioned the 2002 law that transferred ownership of minerals from private owners to the state without compensation.

Government argued that it did not acquire ownership – and thus no expropriation was being imposed – but was merely acting as the "custodian" of the minerals on behalf of all South Africans. The court, bizarrely, accepted this form-over-substance argument, even though our legal tradition mandates that courts look at the substance and not merely the form of conduct.

There are two reasons why a proposed repeal of the compensation clause in section 25 – or, at worst, a repeal of section 25 entirely – would be unconstitutional, even if Parliament secures the requisite two-thirds majority: the rule of law and the basic structure of the Constitution.

Tyrannies the world over, without exception, have a distinct lack of property rights, which is also what distinguishes the new South Africa from the old.

The rule of law

The rule of law is a founding provision of the Constitution. Section 1(c) provides that South Africa is founded on the supremacy of the Constitution and the rule of law. Section 74 provides that this section can only be amended with a 75 percent majority in Parliament, unlike the two-thirds majority required for other provisions.

Property rights are an inseparable part of the rule of law, and would thus be law in South Africa even if section 25, the property rights provision, did not exist.

No society has ever existed under the rule of law without the existence of property rights, nor can it. This is because property rights enable the distinction between the "public" and the "private", an essential distinction if the prohibition of arbitrariness – which the rule of law guards against – is to make sense.

Every successful constitutional state, including the much-touted socialist Scandinavian countries, have strong protections for private property. Tyrannies the world over, without exception, have a distinct lack of property rights, which is also what distinguishes the new South Africa from the old.

But if section 25 is to be amended, it will in effect amount to an amendment of section 1(c) of the Constitution as well, because property rights are an essential characteristic of the rule of law. This will require that elusive 75 percent majority.

It is often argued that the founding provisions cannot be directly enforced, because the rest of the Constitution gives effect to those values. However, one of the prominent rules of constitutional interpretation is that a provision cannot be regarded as redundant or superfluous – if it is in the text of the statute, it is there for a reason.

Furthermore, if section 25 is amended to remove the compensation clause, the Constitution will no longer be giving full effect to section 1(c), meaning it must become directly enforceable. That section 1 can only be amended with a 75 percent majority lends further evidence to the fact that this part of our Constitution is not simply filler text – otherwise there would have been no reason for it to receive this level of inflexibility.

How, and whether, property rights appeared in the final Constitution had the potential to make or break the entire constitutional project.

Basic structure

The second reason that the Constitutional Court will have to find Parliament's reckless disregard for constitutionalism unlawful is embodied in the basic structure doctrine.

Section 74 of our highest law enables Parliament to amend the Constitution, not repeal or replace it. The Constitution, after all, does not provide for its own demise. It is, like all constitutions, intended to be perpetual. Any change disguised as an "amendment" that effectively amounts to repealing the Constitution and replacing it with something else would thus violate the basic structure doctrine. Parliament is not empowered to make a change of this nature.

This doctrine has found its clearest judicial exposition in the jurisprudence of the Supreme Court of India. But our Constitutional Court observed in Premier of KZN v President of SAin 1996, and again in the 2002 UDM case, that the basic structure doctrine may be valid in South Africa, but it elected not to investigate the matter further because it was not relevant to the case before the bench.

Property rights are part of the basic structure of the Constitution because the very existence of the Constitution depended on how the Convention for a Democratic South Africa (Codesa), and subsequently the Constitutional Assembly, formulated the property-rights provision.

How, and whether, property rights appeared in the final Constitution had the potential to make or break the entire constitutional project. As noted above, property rights also constitute a part of the founding value of the rule of law and permeates much of the Bill of Rights, including the rights to human dignity and housing.

Without strong protections for private property, any hope South Africa has for prosperity for all and the country at large will be extinguished. Economic growth, savings, investment and freedom all depend on government failing in this current endeavour.

Martin van Staden is legal researcher at the Free Market Foundation and is pursuing a Master of Laws degree at the University of Pretoria.