Racial quotas ruled unconstitutional
SCA rejects published policy for appointing insolvency practitioners
The Supreme Court of Appeal has ruled that racial quotas are unconstitutional and irrational. The ruling came in a matter brought before the court by the justice minister and the Master of the Supreme Court. Solidarity, various associations acting on behalf of concerned insolvency practitioners and a society of Afrikaans-speaking law practitioners (Vereniging van Regslui vir Afrikaans) were the respondents.
The Supreme Court of Appeal (SCA) has ruled racial quotas are unconstitutional and irrational.
The ruling came in a matter brought before the court by the justice minister and the Master of the Supreme Court.
Solidarity, various associations acting on behalf of concerned insolvency practitioners and a society of Afrikaansspeaking law practitioners (Vereniging van Regslui vir Afrikaans) were the respondents.
At issue was a policy determining the appointment of insolvency practitioners published by the then minister of justice and constitutional development in the Government Gazette in February 2014.
According to the policy, 40% of appointments would go to African, coloured, Indian and Chinese women, 30% to African, coloured, Indian and Chinese men; 20% to white women; and 10% to white men. In 2015, the High Court in Cape Town ruled in favour of Solidarity and others and declared the policy unconstitutional and invalid.
The state approached the Supreme Court of Appeal.
In its judgment delivered on Friday, the appeal court said: “Affirmative action measures are designed to ensure that suitably qualified people, who were previously disadvantaged, have access to equal opportunities and are equitably represented in all occupation categories and levels. They must be suitably qualified in order not to compromise efficiency at the altar of remedial employment.”
Remedial measures had to operate progressively assisting those who, in the past, were deprived of the opportunity to access the relevant requirements to enter the insolvency profession, but such remedial measures must not trump the rights of previously advantaged insolvency practitioners.
“Rigidity in the application of the policy … is frowned upon and runs contrary to [section] 9(2) of the Constitution.”
The multimillion-rand insolvency industry has been shrouded in controversy for years, and changes made to the appointment of liquidators have led to fronting and corruption.
The South African Restructuring and Insolvency Practitioners Association, which represents more than 400 members, and which participated in the case, has warned the policy determining the appointment of insolvency practitioners might have similar unintended consequences.
According to Solidarity CE Dirk Hermann, the Supreme Court of Appeal ruling is of “key directional importance for SA as far as transformation and equality are concerned”.
“What we find surprising, though, is that government seems to believe that its obsession with race takes precedence over the Constitution.
“The SCA found that government is guilty of unfair racial discrimination.
“This is a grave charge against a government that wants to use legislation to criminalise racism,” he said.
Mthunzi Mhaga, Department of Justice spokesman, said they would consider the judgment’s implications.
THE MULTIMILLIONRAND INSOLVENCY INDUSTRY HAS BEEN SHROUDED IN CONTROVERSY AND CHANGES HAVE LED TO FRONTING AND CORRUPTION