IN THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA
Reportable
Case No:
131/2000
In the matter between:
THE NATIONAL DIRECTOR OF
Appellant
PUBLIC PROSECUTIONS
and
WOUTER BASSON
Respondent
Coram:
Hefer, ACJ, Scott, Streicher, Mpati, JJA and Nugent, AJA
Heard:
17 September 2001
Delivered: 28 September 2001
Summary:
Section 18(1) of the Prevention of Organised Crime Act 121
of 1998 – whether retrospective in effect.
J U D G M E N T

NUGENT, AJA:
[1] A statute is said to operate retrospectively if it creates legal
consequences for  conduct only after that conduct has occurred.  The
decisive question in the present appeal is whether s 18(1) of the
Prevention of Organised Crime Act 121 of 1998 (prior to the
amendment of the Act by Act 38 of 1999) operates with that effect.  If
it does, further questions would arise relating to its constitutional
validity, but for the reasons that follow those questions need not
concern us in this appeal.
[2] Before turning to the circumstances which gave rise to the
appeal it is convenient to summarise some of the salient features of the
Act.  Section 18(1) is the foundation for Chapter 5 of the Act, which is
designed to enable a court to deprive a convicted person of the

proceeds of crime.  The section permits a court which has convicted a
person of an offence to make what is referred to as a “confiscation
order” which has the effect of a civil judgment.   The section reads as
follows:
“Whenever a [criminal] defendant is convicted of an offence the
court convicting the defendant may, on the application of the
public prosecutor, enquire into any benefit which the defendant
may have derived from –
(a)
that offence;
(b)
any other offence of which the defendant has been
convicted at the same trial;
and
(c)
any criminal activity which the court finds to be
sufficiently related to those offences,
and, if the court finds that the defendant has so benefited, the
court may, in addition to any punishment which it may impose
in respect of the offence, make an order against the defendant
for the payment to the State of any amount it considers
appropriate and the court may make any further orders as it may
deem fit to ensure the effectiveness and fairness of that order.”

[3] In terms of s 12(3) a person has “benefited from unlawful
activities” (which presumably means that he has derived a benefit as
contemplated by s 18(1)) if:
“… he or she has at any time, whether before or after the
commencement of this Act, received or retained any proceeds of
unlawful activities.”
[4] The amount for which a confiscation order may be made may
not exceed the lesser of (a) “the value of the defendant’s proceeds of
the offences or related criminal activities referred to in [subsection
18(1)]” or (b) the net value of the sum of the defendant’s property and
certain defined gifts made by the defendant (s 18(2)).   Section 19(1)
defines the “value of a defendant’s proceeds of unlawful activities” to
be:
“…the sum of the values of the property, services, advantages,
benefits or rewards received, retained or derived by him or her

at any time, whether before or after the commencement of this
Act, in connection with the unlawful activity carried on by him
or her or any other person.”
[5] Part 3 of Chapter 5 deals with “restraint orders”, which are
designed to ensure that property is preserved so that it can be realised
in satisfaction of a confiscation order.  Section 26(1) authorises the
National Director of Public Prosecutions to apply to a High Court, ex
parte, for an order “prohibiting any person … from dealing in any
manner with any property to which the order relates.”   The remaining
provisions of part 3 of Chapter 5 confer wide powers upon the court as
to the terms of any such restraint order.  In particular, it may appoint a
curator bonis to take charge of the property that has been placed under
restraint, order any person to surrender the property to the curator
bonis, authorize the police to seize the property, and place restrictions

upon encumbering or transferring immovable property.   It may also
make a provisional restraint order having immediate effect and
simultaneously grant a rule nisi  calling upon the defendant to show
cause why the order should not be made final.
[6] The circumstances in which a restraint order may be made are
provided for in s 25(1) as follows:
“A High Court may exercise the powers conferred on it by
section 26(1) [i.e. the powers to make restraint orders] –
(a)
when –
(i)
a prosecution for an offence has been
instituted against the defendant concerned;
(ii)
either a confiscation order has been made
against that defendant or it appears to the
court that there are reasonable grounds for
believing that a confiscation order may be
made against that defendant; and
(iii)
the proceedings against that defendant have
not been concluded;  or
(b)
when –

(i)
that court is satisfied that a person is to be
charged with an offence;  and
(ii)
it appears to the court that there are reasonable
grounds for believing that a confiscation order
may be made against such person.”
[7] The present appeal concerns a provisional restraint order that
was made by the High Court at Pretoria on 3 August 1999.  At that
time the respondent had been indicted on numerous charges of fraud
and theft.  The appellant applied, ex parte, for a restraint order to be
made in relation to property under the respondent’s control.  The
application was supported by affidavits deposed to by Mr Fouche,
formerly employed as a Deputy Attorney-General in the Office for
Serious Economic Offences, who had been instrumental in
investigating the allegations made against the respondent, and Mr
Ackerman, a Deputy Director of Public Prosecutions, who had been

deputed to undertake the prosecution of the respondent.  (The
appellant and a Mr Swanepoel also deposed to affidavits but they take
the matter no further).   What appeared from the affidavits was little
more than a summary of the allegations made against the respondent
in the indictment and the summary of substantial facts. Those
allegations, briefly stated, were that the respondent, while he was a
member of a top secret military project of the former South African
Defence Force, misappropriated for his own benefit some R45 million
of the moneys that had been made available for the project by the
State by channeling the moneys to a web of private companies and
accounts that were under his control.  Mr Fouche and Mr Ackerman
both said that they had considered the evidence against the respondent

and believed that there was a reasonable prospect that he would be
convicted and that a confiscation order would be made.
[8] The application came before Cassim AJ who granted a
provisional restraint order operating with immediate effect.  The order
is lengthy, and its detailed provisions are not material to the present
appeal.   It is sufficient to say that the order incorporated the following
principal features.   It prohibited all persons from dealing with certain
specified property, which included the respondent’s house in Pretoria,
immovable property in Paarl and in England, rights in various
companies situated in this country and abroad, and moneys held in
bank accounts in this country and abroad.   A curator bonis was
appointed to assume control of the property, which was required to be
surrendered to the curator, failing which he was authorized to instruct

the police to seize it.  The respondent, and a certain Mr Viljoen were
also directed to make various disclosures on oath relating to other
property interests.
[9] On the return day of the provisional order the respondent
opposed its confirmation.  The matter came before Roux J who set
aside the provisional order with costs on the attorney and client scale.
The appellant now appeals against that order with leave granted by
this Court.
[10] The offences upon which the respondent was indicted (which
served as the basis upon which the restraint order was sought) were all
alleged to have been committed before the Act came into operation.
The court a quo held that any court that might convict the respondent
would not be entitled in those circumstances to make a confiscation

order because s 18(1) does not have retrospective effect.  It followed
that a restraint order was also not permitted, and on those grounds the
provisional order was set aside.  The court a quo went on to find that a
proper case had in any event not been made out for the grant of a
restraint order, and furthermore that the provisional order was liable to
be set aside for the failure to disclose certain facts to the court which
granted it.  In view of the conclusion I have reached on the main issue
the latter findings are relevant only to the question of costs.
[11] There is a natural resistance to creating legal consequences for
conduct only after the conduct has occurred.  As stated by Justice
Scalia, concurring with the majority in Kaiser Aluminium and
Chemical Corporation et al v Bonjorno et al 494 US 827 at 855:
“The principle that the legal effect of conduct should ordinarily
be assessed under the law that existed when the conduct took

place has timeless and universal human appeal.  It was
recognized by the Greeks … by the Romans … by English
common law … and by the Code Napoleon.  It has long been a
solid foundation of American Law…”
[12] That principle is also recognized by the law of this country in
which there is a strong presumption against the retrospective operation
of a statute: generally a statute will be construed as operating
prospectively only unless the legislature has clearly expressed a
contrary intention (Genrec MEI (Pty) Ltd v Industrial Council for the
Iron, Steel, Engineering, Metallurgical Industry & Others 1995 (1)
SA 563 (A) at 572E-F).   Moreover, a statute that purports to create an
offence (which was not at least an offence in international law) or to
prescribe a punishment, with retrospective effect, will conflict with

sections 35(3)(l) and (n) respectively of the Constitution and might be
invalid unless it can be justified in terms of s 36(1).
[13] If the imposition of a confiscation order upon a convicted person
constitutes a punishment as envisaged by s 35(3)(n) of the
Constitution (cf Welch v United Kingdom 20 EHRR 247) we might for
that reason alone be enjoined by s 39(2) to construe s 18(1) of the Act
so as to operate only prospectively, in order to promote the spirit,
purport and objects of the Bill of Rights.  Because the matter can be
disposed of on ordinary principles of construction, however, we are
not called upon to decide that question in this appeal.
[14] In support of the submission that s 18(1) operates with
retrospective effect the appellant relied upon certain remarks that were
made by this Court in National Director of Public Prosecutions v

Carolus & Others 2000 (1) SA 1127 (SCA), which concerned the
provisions of Chapter 6 of the Act.  In dealing with the question
whether those provisions operated retrospectively Farlam AJA said
the following at par 20:
“It is clear from s 12(3) and s 19(1) of the Act, which are both
contained in chap 5, that the provisions of chap 5…are
retrospective in the sense that, in determining the value of the
proceeds of an accused person’s unlawful activities, the Court is
not confined to those activities which took place after the
coming into operation of the Act …” [emphasis added].
[15] Those remarks do not meet the point that arises in the present
case.   The fact that events preceding the coming into operation of the
Act are to be taken into account in determining whether the defendant
has “benefited from unlawful activities” (s 12(3)), and in valuing the
“proceeds of unlawful activities” (s 19(1)), is not decisive of whether s

18(1) operates with the same effect.  Those sections allow for benefits
received before the commission of the particular offence to be taken
into account, both in determining whether a confiscation order should
be made, and in determining the scope of such an order, and are
equally consistent with the section operating only prospectively as
they are with it operating retrospectively.  To the extent that they are
of assistance at all, in my view they indicate a contrary intention to
that which the appellant contends for: the express reference in those
sections (and in the definitions of ‘pattern of criminal gang activity’
and ‘pattern of racketeering activity’) to events that preceded the Act
coming into operation indicates that the legislature was alive to the
question of retrospectivity, and the absence of similar words in 18(1)
suggests that the omission was deliberate.

[16] The only other provision of the Act upon which the appellant
relied in support of a retrospective construction of s 18(1) was the
definition in s 12(1)(iii) of a “defendant”, which means “a person
against whom a prosecution for an offence has been instituted …”   It
was submitted that the definition includes a person against whom a
prosecution had been instituted at the time the Act came into
operation, from which it follows that s 18(1) extends to offences that
had already been committed. That submission begs the question
whether the definition does indeed include such a person.  It assumes
that s 18(1) operates retrospectively, for if it does not, then the
definition of a “defendant” ipso facto excludes a person against whom
a prosecution was pending at the time the Act came into effect. To
place reliance upon that definition in an attempt to resolve the present

problem seems to me to commit one to a process of circular reasoning.
What is more important, in my view, is to ask whether the legislature
would have resorted to such an oblique method to give retrospective
effect to s 18(1) when express words (as in s 12(3) and s 19(1)) would
have sufficed.  In my view it clearly would not have done so.
[17] The sections that were referred to by the appellant in support of
the construction that it contended for do not constitute the clear
expression of legislative intent that is required before a court will give
retrospective effect to a statute.  The section must thus be construed as
operating only prospectively, with the result that a confiscation order
may not be imposed in consequence of a conviction for an offence
committed before the Act came into effect.  That being so, it could not
be said in the present case that there were grounds for believing that a

confiscation order might be made and a restraint order ought to have
been refused.  On those grounds alone the appeal must fail.
[18] Two matters remain that are relevant to the question of costs.
The learned judge granted a punitive order, both because he
considered the application to be hopeless, and as an expression of
disapproval at certain conduct relating to the circumstances in which
the application was brought.
[19] Section 25(1) of the Act does not permit a court to grant a
restraint order upon nothing more than a summary of the allegations
made against the defendant concerned, and an expression of opinion
by members of the appellant’s staff that a confiscation order will be
granted (which is all that was before the court in the present case).
The section requires that it should appear to the court itself, not

merely to the appellant or his staff, that there are “reasonable grounds”
for such a belief, which requires at least that the nature and tenor of
the available evidence needs to be disclosed.  Precisely what evidence
is required, and the form that it should take, is not necessary, to decide
in the present case, because the punitive costs order was in any event
justified on other grounds.
[20] On the day before the application was brought the respondent’s
legal advisers, who had become aware that a restraint order might be
sought, telephoned Mr Ackerman and told him that such an order was
unnecessary because the respondent laid no claim to any of the
property concerned (other than his house, two motor vehicles, and
personal belongings) which he was willing to place under the control
of the State.  As for the house, Mr Ackerman was told that it was

already under the control of the State as security for the respondent’s
bail.  Mr Ackerman’s response was that they should speak to Mr
d’Oliviera, the Deputy National Director of Public Prosecutions, who
was dealing with the matter. The respondent’s legal advisers
attempted to telephone Mr d’Oliviera on his cell phone the following
morning but the phone had been switched off the previous night and
remained off for the next two days.  On the  morning of 3 August,
before the application was brought, Mr Ackerman spoke to Mr
d’Oliviera, and told him that he had learnt the previous night that the
respondent’s legal representatives were aware of the pending
application.   It seems that he did not disclose the offer that had been
made, because that was not disclosed to the court when the application
was moved by Mr d’Oliveira, who said that he was unaware of it.

Sometime in the course of that morning Mr Ackerman also deposed to
an affidavit in support of the application, in which he made no
mention of the offer that had been conveyed to him the previous day,
but expressed the opinion that it was “necessary and in the interests of
justice” that a restraint order should be made.
[21] Where an order is sought ex parte it is well established that the
utmost good faith must be observed.  All material facts must be
disclosed which might influence a court in coming to its decision, and
the withholding or suppression of material facts, by itself, entitles a
court to set aside an order, even if the non-disclosure or suppression
was not wilful or mala fide (Schlesinger v Schlesinger 1979 (4) SA
342 (W) at 348E – 349B).  The fact that the respondent had
volunteered to place all the affected property under the control of the

State was clearly material.  Why it was not disclosed to Mr d’Oliveira,
and then suppressed in the affidavit deposed to by Mr Ackerman in
support of the application, has not been explained.  It was submitted
on behalf of the appellant that Mr Ackerman might have considered
that the offer was made without prejudice.  There is no suggestion of
that in the evidence.  In my view the affidavit deposed to by Mr
Ackerman was materially misleading.  Although the appellant himself
cannot be said to have been at fault, he must perforce bear the
consequence of the conduct of the officials who are entrusted to
litigate on his behalf.
[22] The question of costs was a matter for the discretion of the court
a quo and this Court will not lightly interfere in the exercise of that
discretion.    In my view there were ample grounds in the present case

for the court a quo to have exercised its discretion in the way in which
it did.
[23] The appeal is dismissed with costs which are to include the costs
occasioned by the employment of two counsel.
_____________
R W NUGENT
Acting Judge of Appeal
Hefer,
ACJ)
Scott,
JA)
Streicher,
JA)
Mpati,
JA)
concur