THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Reportable
Case no: 267/2020
In the matter between:

COMPCARE WELLNESS MEDICAL SCHEME

Appellant

and

REGISTRAR OF MEDICAL SCHEMES

First Respondent

COUNCIL FOR MEDICAL SCHEMES

Second Respondent

CHAIRPERSON OF THE APPEAL BOARD OF
THE COUNCIL FOR MEDICAL SCHEMES

Third Respondent

UNIVERSAL HEALTHCARE ADMINISTRATORS
(PTY) LTD

Fourth Respondent

Neutral citation:
Compcare Wellness Medical Scheme v Registrar of Medical
Schemes and Others (267/2020) [2020] ZASCA 91 (17 August 2020)

Coram:
Cachalia, Schippers and Plasket JJA and Ledwaba and Matojane AJJA

Heard:
No hearing. Decided without a hearing in terms of s 19(a) of the Superior
Courts Act 10 of 2013.

Delivered:
This judgment was handed down electronically by circulation to the
parties’ legal representatives by email, publication on the Supreme Court of Appeal
website and release to SAFLII. The date and time for hand-down is deemed to be
09h45 on 17 August 2020.

Summary:
Section 38(d) of the Constitution – organ of state acting in the public
interest – reviewing its own decision – Promotion of Administrative Justice Act 3 of
2000 applies – Medical Schemes Act 131 of 1998 – Registrar of Council of Medical
Schemes has no discretion to allow a medical scheme to change its name to a name
that is likely to mislead the public – the Registrar has no power to impose allow a
name-change subject to conditions.

ORDER

On appeal from: Gauteng Division of the High Court, Pretoria (Fabricius J as court of
first instance):
The appeal is dismissed with costs, including the costs of two counsel.

JUDGMENT

Plasket JA (Cachalia and Schippers JJA, Ledwaba and Matojane AJJA
concurring)

[1] The Medical Schemes Act 131 of 1998 (the Act) was enacted, inter alia, ‘to
make provision for the registration and control of certain activities of medical
schemes’.1 Section 3 of the Act created the Council for Medical Schemes (the
Council). Its functions include protecting the interests of beneficiaries of medical
schemes.2 In terms of s 18(1), the Minister is required to appoint a Registrar of Medical
Schemes (the Registrar). This officer is the Council’s executive officer and has the
function of managing the Council’s affairs.3 To this end, the Act vests in the Registrar
a wide range of powers, one of which is relevant to this appeal. It is the power, in terms
of s 23, to register or refuse to register a medical scheme’s name or a change to a
medical scheme’s name. This section provides:
‘(1) The Registrar shall not register a medical scheme under a name, nor change the name of
a medical scheme to a name-

(a)
which has already been registered;

1 Long title.
2 Section 7(a).
3 Section 18(2).

(b)
which so closely resembles the name of a medical scheme already registered
that the one is likely to be mistaken for the other; or

(c)
which is likely to mislead the public.
(2) A medical scheme shall not use or refer to itself by a name other than the name under
which it is registered or a literal translation or an abbreviation thereof which has been approved
by the Registrar.
(3) A medical scheme may, with the consent of the Registrar, in conjunction with its registered
name, use, or refer to itself by, the name of a medical scheme with which it has amalgamated
or which it has absorbed or, in the case of a change of name, the name by which it was
previously known.
(4) A medical scheme shall not change its name without the prior written consent of the
Registrar.’

[2] The appellant, Compcare Wellness Medical Scheme (Compcare), applied to
the Registrar, the first respondent, for approval of a change of name. The Registrar
refused approval because he was of the view that the new name was likely to mislead
the public. His decision was upheld on appeal by an appeal committee of the Council.4
Compcare then appealed to the Appeal Board established by s 50 of the Act.5 The
Appeal Board upheld Compcare’s appeal and ordered the Registrar to give effect to
the name-change but attached conditions that Compcare was required to comply with.

[3] The Registrar and the Council brought an application in the Gauteng Division
of the High Court, Pretoria for the review and setting aside of the Appeal Board’s

4 Section 49 of the Act provides:
‘(1) Any person who is aggrieved by any decision of the Registrar under a power conferred or a duty
imposed upon him or her by or under this Act, excluding a decision that has been made with the
concurrence of the Council, may within 30 days after the date on which such decision was given, appeal
against such decision to the Council and the Council may make such order on the appeal as it may
deem just.
(2) The operation of any decision which is the subject of an appeal under subsection (1) shall be
suspended pending the decision of the Council on such appeal.
(3) The Registrar or any other person who lodges an appeal in terms of subsection (1) may in person
or through a representative appear before the Council and tender evidence or submit any argument or
explanation to the Council in support of the decision which is the subject of the appeal.’
5 In terms of s 50(1), the Appeal Board is made up of three persons appointed by the Minister. Section
50(3) provides that ‘[a]ny person aggrieved by a decision of the Registrar acting with the concurrence
of the Council or by a decision of the Council under a power conferred or a duty imposed upon it by or
under this Act, may within a period of 60 days after the date on which such decision was given and
upon payment to the Registrar of the prescribed fee, appeal against such decision to the Appeal Board’.
In terms of s 50(16), the Appeal Board has the power to ‘confirm, set aside or vary’ the decision
appealed against or to ‘order that the decision be given effect to’.

decision. Fabricius J granted that relief. He then granted Compcare leave to appeal to
this court.

Background
[4] Compcare is a medical scheme that is registered in terms of the Act. When it
submitted a number of rule changes and a name-change application, to the Registrar
for his approval, the name-change application was somehow overlooked. It was dealt
with later on its own. The proposed change of name was motivated in detailed written
submissions addressed to the Registrar.

[5] Compcare wished to change its name to Universal Medical Scheme. As its
administrator was Universal Healthcare Administrators (Pty) Ltd, a part of the
Universal group of companies, Compcare appeared to be alive to the fact that the
proposed name had the potential, at the very least, to mislead the public. Indeed, its
motivation for the change was to take advantage of the Universal brand, which it
considered to be much stronger and attractive than its own Compcare brand. Because
it foresaw that the public may be misled by the new name, it undertook in its
submissions to take a number of steps to attempt to mitigate that possibility.

[6] It informed the Registrar that if approval was granted, ‘the Universal group of
companies . . . will grant a royalty free license to the Scheme to use the “Universal”
name and brand, whereafter the Scheme will operate under the name “Universal
Medical Scheme” and will use the Universal logo’. It then gave the first of its
undertakings, namely that ‘all Scheme communication channels, platforms and
materials will be branded as Universal Medical Scheme – clearly indicating that it is
the Scheme as an entity that is being dealt with’ and that the ‘Scheme’s administrators
will always be identified as “Universal Administrators” or “Universal Healthcare
Administrators”’.

[7] Later in the submissions, Compcare gave the following undertakings:
‘6.12
The independence and autonomy of the Scheme and its Board are of paramount
importance. Thus under the shared “Universal” brand attributes, the Scheme and its
administrator will have separate and distinct governance structures, which will include

separate legal advisors, separate auditors and a clear communications policy to ensure that
the respective roles and responsibilities of the Scheme and its administrator (and its managed
health care organization) are clearly delineated and that there is no  confusion created in the
minds of members or the general public that Universal Administrators carries on the business
of a medical scheme, and that members and the general public are not otherwise misled in
any manner.
6.13
Independence will be ensured through the brand architecture and the Scheme will be
branded as an independent entity. A brand is a name, symbol, design or mark that enhances
the value of a product beyond its functional purposes. It is a complex entity as consumers do
not just buy a product, but also the image and experience associated with a product. Brand
architecture is the way in which a set of brands are managed, differentiated and applied in the
market. . .
6.14
All Scheme communication channels, platforms and materials will be branded with the
Universal Medical Scheme logo – clearly indicating that it is the Scheme as an entity that is
being dealt with. “Universal Medical Scheme” will always be used when referring to the
Scheme. The Scheme will also retain its own communications channels, including but not
limited to brochures, a website, client service line and letterhead. The same principles will
apply in respect of communications of Universal Administrators.
6.15
The Board will continue to use every reasonable step available to educate its members
and to reinforce previous training in respect of the demarcation between the Scheme and its
administrators.’

[8] It then said that, in its view, ‘there is no ascertainable harm or prejudice to
members or to the general public if a medical scheme and its administrators share a
common brand’. It thought that the contrary was true – that ‘to the extent that a shared,
trusted brand helps to increase the growth and sustainability of small and medium
open medical schemes, this promotes price and quality competition to the benefit of
members and the general public’.

[9] It is apparent from the Appeal Board’s reasons that it was of the view that the
name that Compcare wanted to take was likely to mislead the public. With reference
to the submissions, the Appeal Board said that Compcare had ‘tendered certain
measures it would implement upon the application being granted to ensure that the
public would not be misled by the proposed name’. Then, again in relation to the

undertakings, the Appeal Board, in explaining why it intended to uphold the appeal,
said:
‘The measures proposed by the appellant to ensure that the public is not likely to be misled
are reasonable, and if diligently implemented as undertaken, are likely to go a long way
towards averting the harm sought to be prevented by section 23(1)(c). The proposed
measures weighed heavily with us in favour of the appellant. It would therefore be appropriate,
in the Order we make, to ensure that the appellant lives up to its undertaking to implement
them. This is because we believe that, absent these measures, it is, as the Act says, “likely”
that the public will be misled; that much is recognized by the appellant itself. Surely, it must
have been exactly as a result of that recognition that the appellant tendered the above
measures in support of its application. Once the name change is approved, as we believe it
should be, on the strength of those measures, the appellant cannot thereafter abandon them
or fail to implement them as diligently as it has undertaken to.’

[10] The Appeal Board concluded its reasons as follows:
‘We are satisfied that the measures tendered by the appellant to ensure that the public would
not be misled, are reasonable. We are therefore of the view that the decisions of the Registrar
and the Appeal Committee should be set aside. The following Order is therefore made:
11.1
The appeal is upheld.
11.2
The decisions of the respondent and the Appeal Committee of the Council for Medical
Schemes are set aside.
11.3
The Registrar of the Council for Medical Schemes is hereby directed to approve the
applicant’s change of name from “CompCare Wellness Medical Scheme” to “Universal
Medical Scheme” in terms of section 23 of the Medical Schemes Act, 131 of 1998.
11.4
The approval for the change of the name is subject to the following conditions:

11.4.1 The appellant shall fully and diligently at all times implement the measures set
out in paragraphs 7.1, 7.2, 7.3 and 7.4 above.

11.4.2 The Registrar’s instrument of approval shall state that the approval is subject
to the appellant fully and diligently at all times implementing the measures set out in
paragraphs 7.1, 7.2, 7.3 and 7.4 above, which measures shall also be stipulated in the
instrument of approval.’

[11] In the court below, Fabricius J held that the Appeal Board had misdirected itself
by upholding the appeal and ordering the Registrar to approve the name-change
subject to conditions. He thus granted the application brought by the Registrar and the

Council to review and set aside the Appeal Board’s decision. He also dismissed a
counter-application for the dismissal of the review application that Compcare brought.

The issues
[12] Two issues arise for decision. The first is jurisdictional. It is whether the Appeal
Board’s decision is reviewable at the instance of the Registrar and the Council in terms
of the Promotion of Administrative Justice Act 3 of 2000 (the PAJA), or in terms of the
principle of legality that is part of the founding Constitutional value of the rule of law.
The second issue is substantive. It is whether the ground of review relied upon by the
Registrar and the Council has been established, as the court below found.

Source of jurisdiction: the PAJA or the principle of legality
[13] The two major ‘pathways’ to the review of administrative-type actions are s 6 of
the PAJA and the principle of legality. The PAJA applies generally to the review of
administrative action as that term is defined in it. The principle of legality applies when
an exercise of public power does not fall within the PAJA’s definition of administrative
action.6 It is necessary to determine which of these pathways to review applies
because that decision determines the basis for the court’s review jurisdiction. That
decision should not, generally speaking, be avoided.7

[14] In State Information Technology Agency SOC Ltd v Gijima Holdings (Pty) Ltd8
the Constitutional Court held that when an organ of state, acting in its own interest,
applies to set aside its own administrative action, the PAJA does not apply. The court’s
reasoning, which has not been without trenchant criticism,9 was that s 33 of the

6 Hoexter Administrative Law in South Africa (2 ed) (2012) at 118 describes the PAJA as the ‘primary
or default pathway to review’. At 121, she says of the principle of legality that it ‘provides a general
justification for the review of exercises of public power and operates as a residual source of review
jurisdiction’. See too National Director of Public Prosecutions and Others v Freedom Under Law [2014]
ZASCA 58; 2014 (4) SA 298 (SCA) paras 28-29.
7 State Information Technology Agency SOC Ltd v Gijima Holdings (Pty) Ltd [2016] ZASCA 143; 2017
(2) SA 63 (SCA) paras 35-36.
8 State Information Technology Agency SOC Ltd v Gijima Holdings (Pty) Ltd [2017] ZACC 40; 2018 (2)
SA 23 (CC); 2018 (2) BCLR 240 (CC).
9 See Boonzaier ‘A Decision to Undo’ (2018) 135 SALJ 642; De Beer ‘A New Role for the Principle of
Legality in Administrative Law: State Information Technology Agency SOC Ltd v Gijima Holdings (Pty)
Ltd’ (2018) 135 SALJ 613. In Buffalo City Metropolitan Municipality v Asla Construction (Pty) Ltd [2019]
ZACC 15; 2019 (4) SA 331 (CC); 2019 (6) BCLR 661 (CC) para 112, Cameron and Froneman JJ
acknowledged the criticism and conceded that the decision may have to be revisited in due course.

Constitution – the fundamental right to just administrative action – that is given effect
to by the PAJA, is for the exclusive benefit of private persons. Organs of state are not
bearers of the fundamental right to just administrative action. When they wish to review
their own decisions, they consequently must do so in terms of the principle of legality.

[15] In this case, the Registrar and the Council claimed standing to review the
Appeal Board’s decision on the basis of the public interest. Section 38 of the
Constitution, which concerns who has standing to enforce fundamental rights,
provides:
‘Anyone listed in this section has the right to approach a competent court, alleging that a right
in the Bill of Rights has been infringed or threatened, and the court may grant appropriate
relief, including a declaration of rights. The persons who may approach a court are-

(a)
anyone acting in their own interest;

(b)
anyone acting on behalf of another person who cannot act in their own name;

(c)
anyone acting as a member of, or in the interest of, a group or class of persons;

(d)
anyone acting in the public interest; and

(e)
an association acting in the interest of its members.’

[16] In the founding affidavit, the Registrar stated that he and the Council ‘regulate
medical schemes in the public interest’ and that they had brought the application ‘in
the public interest, as envisaged by section 38(d) of the Constitution’. He then stated:
’16.1
As I indicate below, the decision of the Appeal Board directs the Registrar to perform
conduct that is ultra vires. I respectfully submit that it is in the public interest that a
decision requiring the Registrar to act unlawfully should be set aside on review.
16.2
Furthermore, the Registrar is acting in the interests of the public in light of the
provisions of section 23(1)(c) of the Act which contemplates the possibility of a
proposed name change causing harm to the public.’

[17] Compcare contented itself with a bare denial that the Registrar and the Council
acted in the public interest or that the name-change would cause prejudice to the
public. Fabricius J appears to have accepted that the Registrar and the Council had
standing in terms of s 38(d) of the Constitution. In keeping with the generous approach

to representative standing that the Constitutional Court in particular has mandated,10
and on the basis of the Registrar’s averments that I have quoted, I find that they indeed
have standing to act in the public interest.

[18] In the State Information Technology Agency case, the Constitutional Court was
only concerned with an organ of state acting in its own interest and reviewing its own
decision. It was not concerned with ‘a scenario where an organ of state that is in a
position akin to that of a private person (natural or juristic) may be seeking to review
the decision of another organ of state’ or with ‘a situation where — in seeking a review
of its own decision — an organ of state is purporting to act in the public interest in
terms of s 38 of the Constitution’.11

[19] The second of these issues was dealt with in Hunter v Financial Sector Conduct
Authority and Others.12 A natural person had claimed standing in terms of s 38(d) of
the Constitution to challenge an exercise of power that the court found was
administrative action. Khampepe J held, as to the consequence of acting in the public
interest:13
‘As a general rule, PAJA must therefore apply unless the review is brought by a public
functionary in respect of its own unlawful decision. In this case, it is Ms Hunter (and not the
FSCA itself) who seeks relief against the registrar's alleged unlawful decisions. Ms Hunter is
not acting on behalf of the FSCA. She is acting in the public interest. Anybody who constitutes
“the public” on whose behalf she has assumed the responsibility to act is entitled to challenge
the fairness of the administrative action that has aggrieved her in terms of PAJA. She, having
stepped straight into their shoes, enjoys all the rights and obligations they each would
ordinarily have shouldered had they chosen to be litigants. PAJA must therefore apply to Ms
Hunter's claim.’

[20] In this case, the decision of the Appeal Board is an administrative action as
defined in the PAJA: it is a decision of an administrative nature, taken in the exercise

10 See for example, Albutt v Centre for the Study of Violence and Reconciliation and Others [2010]
ZACC 4; 2010 (3) SA 293 (CC); 2010 (5) BCLR 391 (CC) paras 32-35.
11 Note 8 para 2.
12 Hunter v Financial Sector Conduct Authority and Others [2018] ZACC 31; 2018 (6) SA 348 (CC);
2018 (12) BCLR 1481 (CC).
13 Para 49.

of a public power by an organ of state in terms of empowering legislation that has the
potential to adversely affects rights, has a direct, external legal effect and is not
excluded by any of sub-sections (aa) to (ii) of s 1 of the PAJA.14 When the Registrar
and the Council brought their application in the public interest, they did so in order to
safeguard the fundamental right of each member of the public to just administrative
action. That being so, they stepped into the shoes of the members of the public on
whose behalf they litigated and, in this sense were, despite being organs of state,
bearers of fundamental rights to just administrative action. The PAJA consequently
applies to the review of the Appeal Board’s decision. It ought to have been applied by
the court below in relation to the argument that the Registrar and the Council had
delayed unduly in launching their review – an issue that is not persisted with by
Compcare – and in relation to the substance of the review. While a review in terms of
the principle of legality produced the same result in this case, that may not always be
so. For instance, the common law that applies to legality reviews differs from the PAJA
in respect of the exhaustion of internal remedies and there are some differences
between the common law delay rule and the PAJA’s delay rule.

The substantive issue: the review of the Appeal Board’s decision
[21] Baxter made the point that administrative law ‘rests upon the principle of
legality’ with the consequence that where a person’s interests have been prejudiced
by ‘administrative action or inaction not authorized by law’ he or she may be awarded
a ‘suitable remedy’.15 He went on to explain the workings of this first principle:16
‘Public authorities possess only so much power as is lawfully authorized, and every
administrative act must be justified by reference to some lawful authority for that act. Moreover,
on account of the institutional nature of law the public authority itself exists as an office or body

14 For the definition of administrative action, see the PAJA, s 1. See too Grey’s Marine Hout Bay (Pty)
Ltd and Others v Minister of Public Works and Others [2005] ZASCA 43; 2005 (6) SA 313 (SCA) paras
21-25.
15 Lawrence Baxter Administrative Law (1984) at 299.
16 At 384. See too De Villiers v Pretoria Municipality 1912 TPD 626, 645-646 in which Bristowe J set
out the principle thus:’ This conclusion seems indeed to be a necessary corollary from the principle that
a statutory corporation established for a particular purpose has no power qua corporation outside the
sphere of activity especially or impliedly prescribed for it by the Legislature. Its acts outside those limits
are therefore void, not so much because the Legislature has prohibited them, as because the powers
which it has conferred upon the being which it has created, do not extend to them. For the purpose of
such acts the corporate persona is in fact non-existent'. On the principle of legality being the first
principle of both administrative law and the rule of law, see Hoexter (note 6) at 255-256.

created by law. A valid exercise of administrative power requires both a lawful authorization
for the act concerned and the exercise of that power by the proper or lawful authority.’

[22] Woolf, Jowell, Donnelly and Hare17 say of the first of a list of legal standards
that public bodies are required to meet in order for their acts to be valid:
‘Public bodies must have legal authority for their actions. This may be derived from statute,
the common law or (in the case of some central government functions) a prerogative power.
Public bodies must act within the scope of that legal authority.’

[23] As the source of the principle of legality is the rule of law, which is a principle of
the common law, was an implicit value of the interim Constitution and is an express
value of the final Constitution, the same position that Baxter and Woolf, Jowell,
Donnelly and Hare outlined continues to apply now. In Fedsure Life Assurance Ltd
and Others v Greater Johannesburg Transitional Metropolitan Council and Others18
Chaskalson P, Goldstone and O’Regan JJ held that it was ‘central to the conception
of our constitutional order that the legislature and executive in every sphere are
constrained by the principle that they may exercise no power and perform no function
beyond that conferred upon them by law’.19

[24] Section 33(1) of the Constitution, a provision which gives effect to the founding
value of the rule of law, guarantees for everyone the rights to lawful, reasonable and
procedurally fair administrative action. Section 6(2)(a)(i) of the PAJA is one of a
number of provisions that give effect to the right to lawful administrative action. It
provides that a court may review and set aside an administrative action if it was taken
by an administrator who ‘was not authorized to do so by the empowering provision’.
This is the principal ground of review that is implicated in this case.

[25] Before turning to whether the Appeal Board exceeded its lawful authority, it is
necessary to deal briefly with one factual issue: whether the proposed new name for

17 Woolf, Jowell, Donnelly and Hare De Smith’s Judicial Review (8 ed) (2018) para 1-001.
18 Fedsure Life Assurance Ltd and Others v Greater Johannesburg Transitional Metropolitan Council
and Others [1998] ZACC 17: 1999 (1) SA 374 (CC); 1998 (12) BCLR 1458 (CC).
19 Para 58. This dictum has since been approved by the Constitutional Court in numerous judgments.
See for example President of the Republic of South Africa and Others v South African Rugby Football
Union and Others [1999] ZACC 11: 2000 (1) SA 1 (CC); 1999 (10) BCLR 1059 (CC) para 148.

Compcare was likely to mislead the public. In my view, the answer is in the affirmative.
Compcare itself appeared to accept that this was so by giving mitigatory undertakings,
and the Appeal Board accepted that too: its order is based on the premise that the
new name was likely to mislead the public, and so required conditions to be added to
minimize that consequence.

[26] Both Compcare and the Appeal Board were correct. The very basis for the
name-change, which was explicitly stated in Compcare’s submissions, was to enable
Compcare to ride on the coat tails of the Universal group of companies and derive
benefit from the Universal brand. Compcare, in other words, wanted to create in the
minds of the public the impression that it was part of the Universal Group. All that a
string of disclaimers was likely to achieve was greater confusion. In the result, the
Registrar’s finding that the proposed new name was likely to mislead the public was
rational and cannot be faulted. The same may be said of the Appeal Board’s finding
to the same effect.

[27] Two issues arise in relation to the empowerment of the Registrar to accept or
reject a change of name in terms of s 23(1)(c) of the Act, and by extension, of the
Appeal Board to order him to do so. They are whether the Registrar has a discretion
to allow a name-change even though it is likely to mislead the public and, related to
this, whether he has the power to approve a name-change subject to conditions. If the
Act does not authorize one or both, the Appeal Board, in making its order, exceeded
its powers – it would have taken administrative action that it was not authorized to
take.

[28] Section 23(4) provides that a medical scheme may not change its name without
the consent of the Registrar. Section 23(1) then limits the power of the Registrar by
stipulating what types of names he may not approve – those that have already been
taken, those that resemble so closely names that have already been registered that
confusion between them is likely and those that are likely to mislead the public. While
in respect of the first category, the Registrar’s decision will no doubt be determined
with reference to his records, decisions in respect of the second and third categories
inevitably require a measure of judgment on his part. Once he has made a decision

that a name proposed by a medical scheme is one contemplated by either a 23(1)(a),
(b) or (c), however, the Act is clear: he may not register that name or allow a change
to that name.

[29] There is no room within the structure of s 23(1) for a discretion. There is no
indication in the section that could lead one to conclude that a discretionary power to
deviate from its express terms could have been intended, or that it is necessary to
attain its purposes, or is incidental to the express provisions. To the contrary, the
recognition of an implied discretion would create a conflict within the section: the
Registrar would be expressly prohibited from registering names that he decided were
prohibited by s 23(1), but then at the same time allowed to exercise a discretion to do
so nonetheless. One only has to consider the case of an application to register a name
that is already registered to highlight the absurd results that such an interpretation of
the section could spawn.

[30] The second issue that arises for decision is whether, despite a name being one,
for instance, that is likely to mislead the public, conditions may be imposed to reduce
the risk of that eventuating. Compcare’s argument is that the Registrar may impose
conditions in these circumstances because the imposition of conditions is not
precluded by s 23(1). This is not the correct approach. In Burghersdorp Municipality v
Coney20 it was argued that a municipality had power to do anything it was not
prohibited from doing. Davis J was of the view that this submission was ‘startling’,
holding that it was in conflict with the ‘current of authority’.21

[31] In that conclusion, Davis J was undoubtedly correct. In Principal Immigration
Officer v Medh,22 this court was required to decide on the validity of a decision of a
minister to exempt the respondent from the status of a prohibited person subject to
conditions. De Villiers JA approached the issue thus:23

20 Burghersdorp Municipality v Coney 1936 CPD 305.
21 At 308. See too Malherbe v South African Medical and Dental Council 1962 (1) SA 825 (N) at 829G-
830A.
22 Principal Immigration Officer v Medh 1928 AD 451.
23 At 457-458.

‘In dealing with the power of exemption the section is silent as to conditions to be imposed.
But an exemption conditional upon maintaining his domicile can hardly be called an
exemption. A person is either exempted from the class of prohibited immigrants or he is not.
There is no intermediate position. The Minister is given the power to take a prohibited
immigrant out of the class of prohibited immigrant or not, as he pleases. But if he decides in
favour of the former course, he must take that person out of the class entirely and once and
for all. It might be, however, said that power to grant exemption includes a power to attach
whatever conditions the Minister might consider reasonable. But the argument begs the
question. The powers of the Minister must be found within the section creating them, and
according to that section the Minister only has power either to exempt or not: there is no third
course. In the absence of specific provisions to that effect, such power cannot be construed
as embracing the wider power of attaching conditions. If it had been the intention of the
Legislature to confer upon the Minister the additional power of attaching conditions to the
exemption, it should have said so, as it has done in the case of temporary permits as well as
in sec. 31(2), Act 38 of 1927.’

[32] The starting point of the enquiry in this case is s 23(1). For a power to impose
conditions to exist, it must be created by the Act. Section 23(1) does not expressly
empower the Registrar to impose conditions, assuming for purposes of the argument
that he has a discretion to register a name that offends s 23(1). I can see no possible
basis for somehow implying it in the section. In much the same way as there was no
‘third course’ in Principal Immigration Officer v Medh, so too in this case: the
Registrar’s choices are either to approve a name or to refuse to approve it. There is
much to be said too for the argument that if the legislature had intended the Registrar
to have the power to impose conditions, it would have said so, as it did in s 24(1) which
deals with the registration of medical schemes. This section provides that the Registrar
‘shall, if he or she is satisfied that a person who carries on the business of a medical
scheme which has lodged an application in terms of section 22, complies or will be
able to comply with the provisions of this Act, register the medical scheme, with the
concurrence of the Council, and impose such terms and conditions as he or she deems
necessary’.

[33] I conclude therefore that the Appeal Board’s decision cannot stand and that the
court below was correct to set it aside because: (a) the Registrar had no lawful power

to approve Compcare’s proposed change of name once he had concluded that it was
a name that was likely to mislead the public; (b) he also had no lawful power to approve
such a change of name subject to conditions; and (c), as a result, the Appeal Board
exceeded its powers by purporting to order the Registrar to approve a name that was
likely to mislead the public, subject to conditions.

The order
[34] I make the following order:
The appeal is dismissed with costs, including the costs of two counsel.

________________________
C Plasket
Judge of Appeal

APPEARANCES

For the appellant:

M Du Plessis SC and S Pudifin-Jones
Instructed by:
ENSafrica, Johannesburg
Webbers, Bloemfontein

For the first and second respondents:

A Cockrell SC and A J Lapan
Instructed by:
Lawtons Inc, Johannesburg
Symington & De Kok, Bloemfontein

THE SUPREME COURT OF APPEAL OF SOUTH AFRICA

MEDIA SUMMARY OF JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

FROM

The Registrar, Supreme Court of Appeal

DATE

17 August 2020

STATUS

Immediate

Please note that the media summary is for the benefit of the media and does not form part of
the judgment.

Compcare Wellness Medical Scheme v Registrar of Medical Schemes & others
(267/2020) [2020] ZASCA 91 (17 August 2020)

MEDIA STATEMENT

The Supreme Court of Appeal (SCA) today dismissed the appeal of Compcare Wellness
Medical Scheme (Compcare) against the Registrar of Medical Schemes (the Registrar) and
the Council of Medical Schemes (the Council). Compcare had applied to the Registrar for
approval of a change of its name from Compcare to Universal Medical Scheme. It was
administered by Universal Health Care Administrators, a part of the Universal group of
companies, and wanted to take advantage of the Universal brand, which it considered to be
stronger than its own brand. The Registrar, in terms of s 23(1)(c) of the Medical Schemes Act
31 of 1998 (the Act) refused the application because he considered the new name to be likely
to mislead the public.
Compcare appealed successfully to the Appeal Board created by s 50 of the Act. The
Appeal Board found that the new name was indeed likely to mislead the public but imposed
conditions proposed by Compcare to mitigate the misleading effect. It ordered the Registrar
to give effect to the name-change subject to the conditions. The Registrar and the Council
took this decision on review. Fabricius J, in the Gauteng Division of the High Court, Pretoria
upheld their application and set aside the Appeal Board’s decision.
In Compcare’s appeal against that decision two issues required resolution. The first
was whether the court’s review jurisdiction arose from the principle of legality or the Promotion
of Administrative Justice Act 3 of 2000 (the PAJA). The Constitutional Court has decided that
the PAJA does not apply when an organ of state, acting in its own interest, reviews its own
decision because an organ of state is not a bearer of administrative justice rights. In this case,
however, the Registrar and the Council brought the application in the public interest (in terms
of s 38(d) of the Constitution). In so doing they, in effect, stepped into the shoes of the
members of the public who they represented and who were bearers of administrative justice
rights. As a result, the PAJA applied.

The second issue concerned the merits of the Appeal Board’s decision. That in turn,
required an analysis of the Registrar’s powers in terms of s 23(1) of the Act. The section gave
him no discretion to allow a change of name if it was likely to mislead the public. He was bound
to refuse it. And the section did not empower him to impose conditions. That being so, because
the Registrar had no power to approve Compcare’s change of name, the Appeal Board
exceeded its powers by purporting to order the Registrar to do so.