Unity is Strength
Now we’re going to take on the bullies!
I know some people don’t like confrontation, and I know some people believe in the principle of just turning the other cheek. If you’re one of those people, please don’t read any further, because this letter will upset you.
There are a few injustices happening that are bothering me a lot. What bothers me the most is the fact that the offenders are getting off scot-free. The reason for this is that the victims don’t have the knowledge and/or financial means to do something about it, and the bullies know this. Well, that’s going to change now, because I’ve discovered a new law!
It’s not really a new law, actually, but it’s a principle that was unknown in our legal system before 1994. Thanks to our new constitution, it’s no longer unknown. It just isn’t used very often because not many people know about it. It’s called a class action.
The following excerpt of a judgement by Judge Cameron (at the time still a judge of the Constitutional Court) in Permanent Secretary, Department of Welfare, Eastern Cape, and Another v Ngxusa and Others 2001(4) SA 1184 (SCA) got me thinking, and it illustrates the value of class actions:
“In the type of class action at issue in this case, one or more claimants litigate against a defendant not only on their own behalf but on behalf of all other similar claimants.
The most important feature of the class action is that other members of the class, although not formally and individually joined, benefit from, and are bound by, the outcome of the litigation unless they invoke prescribed procedures to opt out of it. The class action was until 1994 unknown to our law, where the individual litigant’s personal and direct interest in litigation defined the boundaries of the court’s powers in it. If a claimant wished to participate in existing court proceedings, he or she had to become formally associated with them by compliance with the formalities of joinder.
The difficulties the traditional A approach to participation in legal process create are well described in an analysis that appeared after the class action was nationally regularised in the United States through a Federal Rule of Court more than 60 years ago:
The class action cuts through these complexities. The issue between the members of the class and the defendant is tried once. The judgment binds all and the benefits of its ruling accrue to all. The procedure has particular utility where a large group of plaintiffs each has a small claim that may be difficult or impossible to pursue individually. The mechanism is employed not only in its country of origin, the United States of America, where detailed rules governing its use have developed, but in other countries as well.
The reason the procedure is invoked so frequently lies in the complexity of modern social structures and the attendant cost of legal proceedings:
‘Modern society seems increasingly to expose men to such group injuries for it is precisely because so many in our country are in a ‘poor position to seek legal redress’ and because the technicalities of legal procedure, including joinder, may unduly complicate the attainment of justice that both the interim Constitution and the Constitution created the express entitlement that ‘anyone’ asserting a right in the Bill of Rights could litigate ‘as a member of, or in the interest of, a group or class of persons’.”
Groups like Afriforum regularly fight against social injustices, but no-one ever fights against commercial injustices. The question I now have is why can’t we use this class action principle, or even a variation of it, to fight commercial injustices? It looks to me like the reason that it’s not done is because no-one is prepared to go out on a limb. Well, I’m prepared to, and I’m going to do it.
The big obstacle stopping people from taking action themselves is the legal costs, and the biggest reason that people don’t take action jointly is because they don’t have each other’s information. Both these obstacles have now been removed, because I will act as co-ordinator and the legal costs will be equally divided among all the claimants. We’ll even be able to afford to hire the best private investigators to collect evidence. All of this will cost each claimant a fraction. I myself am not looking for any remuneration for my services. The pleasure’s enough for me!
It reminds me of the true-story movie “Erin Brockovich”, where she took the lead in taking on and beating the big mining powers. Do go and rent that DVD.
Injustices that I want to address through separate class actions:
Injustice One – The banks’ repossession policy
Fortunately, not many of our members have been victims, but statistics show that thousands of other people have been victims of the banks. People who lost their income due to the .........................
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Would it be possible to do something similar about the looming water crisis, electricity and state of our roads? In the US class action law suits were successfully brought against state departments for dumping sewerage into the rivers.
Comment by Herman — April 28, 2010 @ 11:21 am
Coert, I have always admired your success. I am really glad to hear that you want to take on the fat cats who own banks and insurance companies. The real arrogance of these companies has always been grossly under-estimated and/or overlooked. Perhaps this is best illustrated by what is happening to the massive financial firm Goldman Sachs in the USA (which is now facing civil fraud charges) This greedy company was actually handing out loans to their clients and then “betting” on the fact that these clients would default on the loans! To compound their arrogance even more, Goldman Sachs today told a US Senate hearing that the entire thing never happened and that the actual transaction which was being investigated, was a perfectly legal but that “ordinary” people (i.e. you and me) are just too “unsophisticated” to understand it!!!! AS Donald Trump would say: “can you believe this sh.t?” Cutting these “institutions down to size” is a long overdue and extremely necessary (and urgent) priority for all of us!
Comment by Stephen — April 28, 2010 @ 12:35 pm
Ek dink jy is op die regte pad Coert. Hierdie is al lankal nodig in ons land maar oor die jare was ons so gekondisioneer dat ons niks daaraan doen nie. Kyk maar na Afriforum se sukses.
Die banke is n groot doring, jou doelwit no 1 is maar net 1 geval maar wat van diensgelde bv op OTM onttrekkings, op verbande, ens waar die ombudsman seker 2 jaar terug bevind het die banke moet minder diensgeld hef maar hulle steur hulle eenvoudig nie daaraan nie! Banke hef tussen R30 – R45,00 per verband om elke 3de maand ‘n staat te stuur?
Jy het my ondersteuning.
Sterkte
Gerhard Eksteen
Comment by Gerhard — April 28, 2010 @ 5:06 pm
These cases need Allen Shaw!
Comment by Ikageng — April 28, 2010 @ 11:02 pm
Coert – I agree 100% with you on the banks, and have been considering how to canvass opinion myself on a class action against First Rand Bank (one of its subsidiaries in fact), so I’ll keep in touch.
Re: “The real arrogance of these companies has always been grossly under-estimated and/or overlooked. Perhaps this is best illustrated by what is happening to the massive financial firm Goldman Sachs in the USA”
However, when it comes to banks in SA, look at not only the dog-bites-hand-that-feeds-it, but also the dog-eat-dog, attitude below (I have emailed you the full article) :
Honey, Nedbank shrunk the shares
Issue # 126 April, 2010
http://www.noseweek.co.za/articles/2234/Honey,-Nedbank-shrunk-the-shares
In a better world the head of Nedbank Capital, Brian Kennedy, would, by now, be in jail.
Why? Three years ago he connived at what amounts to a scheme of reckless lending, which would earn Nedbank close on R150m in fees and interest, but which he knew with near certainty would end up costing an ignorant surety R1bn or more – and, along the way, defraud some investors of another billion or so.
… Business Times broke the news that Nedbank was being sued for R1.3bn for its role in the single stock futures debacle around Pinnacle Point
… Now, clearly, to pull off a crime like that requires a disguise, some sleight of hand and, preferably, the cover of darkness. All were seemingly provided by Safex
… As far as noseweek has been able to establish, it all disappeared off-shore, and is likely buried on some Caribbean island, at the place marked “X”.
… There is a last, ugly twist to this unfortunate tale: apart from the shares it dumped on Absa when De Beer defaulted, Nedbank held another 25-odd million Acc-Ross shares on its own account. De Beer was officially in default on 3 December 2008, but this was only disclosed to the public on 1 February, when Business Times broke the story. Only then did the share price crash. It now emerges that Nedbank made use of the intervening weeks to quietly dispose of its remaining shares at the still inflated price – an ugly bit of insider trading if ever there was one.
<<>>
Comment by True Justus — April 29, 2010 @ 3:26 pm
… continued (Take IV)
(I give up on delimiters) :
What the Noseweek article in paper and ink had, that the online article seems to be missing, is that ABSA are apparently “walking away” from any legal action regarding misconduct by Nedbank in this deal. Noseweek suggested that this can only mean unacceptably high degree of collusion amongst the banks – they must be really scared of the maxim “people in glass houses should not throw stones” !
Comment by True Justus — April 29, 2010 @ 3:32 pm