THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

JUDGMENT

Case No:  178/08

In the matter between:

SOUTH AFRICAN BROADCASTING CORPORATION LTD      APPELLANT

v

FRED PETER COOP & OTHERS                                             RESPONDENT

Neutral citation:
SA Broadcasting Corporation v Coop (178/2008) [2009]
ZASCA 30 (30 March 2009).

Coram:
Nugent, Jafta, Mlambo, Maya JJA et Hurt AJA
Heard:
2 March 2009
Delivered:
30 March 2009

Summary:    Court order – meaning and effect – SABC seeking to phase out
and withdraw benefits it had been ordered to maintain – not
shown by SABC that legal basis of order no longer in existence.

______________________________________________________________

ORDER
______________________________________________________________

On appeal from: High Court, Witwatersrand (Mogagabe AJ sitting as court of
first instance).

The following order is made:

‘The appeal is dismissed with costs including the costs of two counsel.’

_____________________________________________________________

JUDGMENT
_____________________________________________________________

MLAMBO JA (Nugent, Jafta, Maya JJA, Hurt AJA concurring)

[1] This is an appeal by the South African Broadcasting Corporation
(SABC),
against
the
judgment
of
the
Johannesburg
High
Court
(Mogagabe AJ) granting the respondents an interdict and other ancillary relief
against it. The appeal is with the leave of the court a quo.

[2] The matter has a somewhat chequered past spanning some 8 years of
litigation between the parties and I sketch such to facilitate an appreciation of
the issues of contestation. The respondents were part of a group of
employees who left the employ of the SABC between 1993 and 2000 and
were paid the full actuarial value of their pensions. They, however, remained
members of the SABC medical scheme and the SABC continued paying a 60
per cent subsidy of their monthly medical scheme contributions, amongst

other so-called retirement benefits (the subsidies).1 The SABC also paid the
same subsidies to other employees who had left its employ and who had
remained members of the medical scheme but who had not been paid the full
actuarial value of their pensions. These latter employees came to be known
as ‘bona fide pensioners’ and are regarded by the SABC as retirees in terms
of its pension fund rules.

[3] In 2001 the SABC gave notice to the respondents of its intention to
withdraw their subsidies. The SABC justified its stance on the basis that the
respondents were not retirees and that the subsidies paid on their behalf had
not been authorised. The SABC relied on the fact that upon termination of
their employment the respondents lost any claims they may have had in terms
of its pension fund rules, having been paid the full actuarial value of their
pensions. Having unsuccessfully disputed the SABC’s stance the respondents
instituted motion proceedings in the Johannesburg High Court seeking an
order, amongst others, for the reinstatement of their subsidies, which the
SABC had withdrawn in keeping with its notice to the respondents.

[4] In view of some irresoluble disputes of fact on the papers, the matter
was referred to trial for the hearing of evidence. Blieden J heard the matter
and rejected the SABC’s claims. He found that the SABC had ratified the
decisions by its officials to extend the subsidies to the respondents, and
granted the respondents the relief they sought. That judgment has since been
reported: Coop & others v South African Broadcasting Corporation & others

1 The other subsidy related to television licenses.

[2004] 25 ILJ 1933 W. Blieden J essentially ordered the SABC to reinstate the
subsidies.

[5] Having been granted leave by Blieden J the SABC appealed his orders
to this court. In that appeal this court upheld Blieden J’s orders, albeit for
different reasons. This court disapproved Blieden J’s finding that the SABC
had ratified the decision of its officials in extending the subsidies to the
respondents. It reasoned that the respondents had established that the SABC
was estopped from denying the authority of its officials who had purported to
represent it in agreeing that the respondents could be treated as retirees and
therefore entitled to the subsidies. It further found it unnecessary to decide
whether the respondents were contractually entitled to the subsidies as
contended by them or whether these were gratuitous as asserted by the
SABC. The decision of this court has also since been reported: South African
Broadcasting Corporation v Coop & others 2006 (2) SA 217 (SCA).

[6] Nearly a year after the handing down of the judgment and order of this
court, the SABC sent out a standard letter to the respondents stating,
amongst other things, that after intensive consultation with the so-called bona
fide pensioners (retirees) it had decided to commence phasing out the
subsidies paid to these retirees over a five year period. The SABC stated that
it continued to hold the view that it was entitled to vary, withdraw or phase out
the subsidies on reasonable notice. In that letter the SABC gave the
respondents notice that it had decided to commence phasing out their
subsidies at the rate of 20 per cent per annum with effect from 1 February

2007. On receipt of that letter the respondents disputed the SABC’s stance
and threatened litigation to enforce their rights to the subsidies unless the
SABC undertook not to phase them out. After eliciting no response the
respondents again launched motion proceedings in the Johannesburg High
Court inter alia seeking an order interdicting and restraining the SABC from
withdrawing or in any way reducing or phasing out the subsidies.

[7] In that matter the respondents’ stance was simply that the conduct of
the SABC in phasing out or reducing their subsidies was in conflict with and in
contempt of the judgment and order of Blieden J. On the other hand the
SABC asserted that it was entitled to phase out the subsidies by virtue of the
fact that it had commenced phasing out same in respect of the bona fide
pensioners. The SABC’s interpretation of the reasoning underlying Blieden J’s
order was that the respondents had to be treated in the same manner as the
bona fide pensioners. On that basis its counsel submitted that because it had
decided to phase out the subsidies of those pensioners, it was entitled to
phase out the subsidies of the respondents as well.

[8] Having heard argument Mogagabe AJ found in favour of the
respondents and ordered the SABC to comply with the order issued by
Blieden J. He also granted an order interdicting and restraining the SABC
from phasing out the subsidies. In arriving at that conclusion Mogagabe AJ
reasoned that the SABC was misguided in interpreting Blieden J’s order to
mean that it was entitled to disregard that order so long as it was treating the
respondents in the same manner as the bona fide pensioners. In this regard

Mogagabe AJ reasoned that Blieden J’s order could not be interpreted to
mean that the SABC was entitled to phase out and withdraw the subsidies of
bona fide pensioners.

[9] On appeal before us counsel for the SABC submitted that Mogagabe
AJ had erred in holding against it. He submitted that Blieden J’s order did not
mean that the SABC was bound to comply therewith in perpetuity. He
submitted that the SABC’s decision to phase out the subsidies in conformity
with its decision to do so in relation to bona fide pensioners was a new act
that occurred after the order had been granted and relieved the SABC of its
obligation to henceforth comply with the order.

[10] I do not think a litigant who is bound by a continuing mandamus is able
to escape those obligations merely by alleging that he or she has chosen to
end them. It cannot be disputed that the order was made because it was
found that the respondents had a legal right to continue to receive the
subsidy. While it is correct that the order was not made in perpetuity it
remains effective until the rights upon which it was founded come to an end.
Where those rights emanate from a contract then no doubt they end when the
contract lawfully terminates. But the SABC has laid no basis for finding that
the rights have been lawfully terminated in this case. A mere assertion that it
has terminated those rights, without establishing that the termination was
lawful, does not seem to me to be sufficient to relieve it of the continuing
obligations imposed by the order.

[11] We were asked by counsel for the respondents to rule that the finding
by Blieden J in the course of his judgment that the respondent’s contracts
entitled them to the subsidies is res judicata between the parties. I do not
think we are called upon to stray beyond what is properly required for our
decision in this appeal.

[12] The appeal is dismissed with costs including the costs of two counsel.

_________________
D MLAMBO
JUDGE OF APPEAL

APPEARANCES:

COUNSEL FOR APPELLANT:
C E Watt-Pringle SC; M S Baloyi
INSTRUCTED BY:
Maserumule Inc; Johannesburg
CORRESPONDENT:                   Honey Attorneys; Bloemfontein

COUNSEL FOR RESPONDENT: J J Reyneke SC; A Mooij
INSTRUCTED BY:
Blake Bester Inc; Johannesburg
CORRESPONDENT:

Naudes ; Bloemfontein

THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

From:
The Registrar, Supreme Court of Appeal

Date:
30 March 2009

Status:
Immediate

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

SOUTH AFRICAN BROADCASTING CORPORATION v COOP & OTHERS

The Supreme Court of Appeal (SCA) today confirmed the decision of the
Johannesburg High Court which had interdicted the SABC from phasing out
certain subsidies enjoyed by the respondents who were no longer employees of
the SABC but had remained on the SABC Medical Scheme,.

The SABC had, years before, withdrawn the subsidies but the Johannesburg
High Court ordered it to reinstate them. That order was confirmed by the SCA.
Subsequently the SABC commenced phasing out the subsidies of another group
of former employees and notified the respondents in this case that it would
commence doing the same regarding the subsidies paid to them. As a result of
an impasse the respondents instituted motion proceedings in the Johannesburg
High Court.

The Johannesburg High Court found that its previous order remained binding on
the SABC. On appeal the SCA, upholding the judgment and order of the
Johannesburg High Court, concluded that the previous order of the High Court
remained effective until the rights upon which it was founded came to an end.