Weekend Argus (Saturday Edition)
‘Win paves way for class-actions’
WHISTLE-blowing bread distributor Imraahn Mukkadam is “thrilled” at his Constitutional Court win, but says the court victory is less about money and more about paving the way for other class-action lawsuits.
On Thursday the Cape Town man won his Concourt appeal, in a bid to lodge a class-action lawsuit against major bread producers, but said afterwards his win would open the way for others, “like mineworkers who suffer from silicosis”, to pursue legal action against their employers.
The judgment sets aside earlier judgments by the Western Cape High Court and the Supreme Court of Appeal (SCA), which refused Mukkadam the certification necessary to lodge a class-action lawsuit. Along with 100 other bread distributors, he will now pursue a class-action claim for damages allegedly suffered as a result of price-fixing by Pioneer Foods, Tiger Consumer Brands and Premier Foods.
The mechanisms around such a class action are not well-defined in the constitution, and are generally considered untested legal ground in South Africa.
Mukkadam said his case was about establishing new ground for class- action lawsuits, and holding unscrupulous companies accountable.
During Thursday’s ruling, Justice Chris Jafta found that the SCA had erred in not having found Mukkadam’s application “potentially plausible”, as it had found in a separate application by several NGOs, consumers and institutions.
He said that court should also not have decided that the certifi- cate could be granted only if Mukkadam showed exceptional circumstances why this should be. The order, in effect, enables Mukkadam to return to the High Court to pursue certification.
His case dates right back to 2006, when the Competition Commission launched an investigation into the bread producers involved, after Mukkadam blew the whistle about price-fixing.
Tiger Brands was fined almost R99 million and Pioneer Foods about R196m. Premier Foods evaded a fine for co-operating with the commission.
Yesterday Mukkadam also called for directors to be held personally accountable for the illegal dealings of their companies.
“The companies get a slap on the wrist while the directors walk away with a smile on their faces, and consumers and shareholders are the ones made to pay.
“If they are found to have known about the illegal dealings, then they should be banned from holding such directorships.”
He said the directors behind the bread scandal would likely escape legal action by taking early retirement “off the profits from their illegal actions”.