Lucky Mashavha v Enaex Africa (Pty)Ltd and others [2024] ZAGDJHC (22 April 2024)

On April 16, 2024, Wilson J dismissed an application due to lack of jurisdiction and the applicant's lack of standing. The applicant, Mr. Mashavha, was ordered to pay the costs of the application.

However, a new rule, Rule 67A of the Uniform Rules of Court, came into effect on April 12, 2024, which requires party and party costs in the High Court to be awarded on one of three scales: "A", "B", or "C". Wilson J sought written submissions from the parties on the applicability of Rule 67A to this case and the appropriate scale for costs. Rule 67A addresses the maximum rate at which counsel's fees can be recovered in party and party costs orders, focusing on the work done in presenting the case before the court. The rule allows the court to set a maximum recoverable rate considering the importance, value, and complexity of the matter. Wilson J interprets the rule to mean that the appropriate scale should be identified first, considering the nature of the case, and then potentially reduced if there was unethical conduct by the successful party. The rule applies prospectively to cases heard after April 12, 2024, with the nominated scale applying only to work done after that date. Wilson J concludes that the case is uncomplicated, competently and ethically pursued, and the "A" scale is applicable. Despite requests for the "C" scale by the first respondent, Wilson J emphasises that the focus of Rule 67A is on the nature of the case and the conduct of the successful party, not the losing party. The importance and complexity of the case do not justify a higher scale, and the damages claimed by Mr. Mashavha are irrelevant to the costs assessment for the fourth respondent. Wilson J expresses concern about escalating counsel fees and the potential for injustice if higher scales are applied in ordinary cases.

The core legal principle underlying the decision is the interpretation and application of Rule 67A of the Uniform Rules of Court, which came into effect on April 12, 2024, and sets out a new framework for awarding party and party costs in the High Court. The principle can be summarised as follows:

1. Prospective Application: The rule applies prospectively to cases heard after April 12, 2024, with the nominated scale only applicable to work done after that date.

2. Nature of the Case and Conduct of the Successful Party: The focus of Rule 67A is on the nature of the case (its importance, value, and complexity) and the conduct of the successful party, rather than the losing party. The court should first identify the appropriate scale ("A", "B", or "C") based on these factors and then consider any unethical conduct that may warrant a reduction in the scale.

3. Ordinary Cases and Scale "A": Run-of-the-mill or ordinary cases, which are the majority of cases in the High Court, should generally attract an order on Scale "A," which is the default position. Scales "B" and "C" should be reserved for truly important, complex, or valuable cases.

4. Complexity and Importance: The assessment of complexity and importance should be objective and based on the arguments that had to be advanced, rather than the potential complexity or the subjective beliefs of the parties.

5. Misconduct of the Unsuccessful Party: The misconduct of the unsuccessful party is irrelevant to the costs assessment once a punitive costs order has been declined.

6. Duty of Diffidence: There is a concern about escalating counsel fees, and Judges should exercise restraint in applying Scales "B" and "C" to avoid further inflating fees and causing substantial injustice.

The case law referenced in the judgment provides context and supports the interpretation of Rule 67A:

1. Camps Bay Ratepayers and Residents Association v Harrison 2012 (11) BCLR 1143 (CC): This Constitutional Court case expressed concern over the skyrocketing counsel's fees and emphasised the need for restraint in a country with gross disparities and poverty. The court found no justification for advocates charging hundreds of thousands of rands, regardless of the complexity of the issues. This case sets a precedent for the interpretation of Rule 67A, emphasising the duty of diffidence and the need to prevent further inflating legal fees.

2. Rule 67A of the Uniform Rules of Court: This rule, which came into effect on April 12, 2024, directly addresses the awarding of party and party costs in the High Court. It allows the court to set a maximum value for the recovery of counsel's fees based on the importance, value, and complexity of the matter. The rule introduces three scales ("A", "B", and "C") with increasing maximum tariffs for counsel's fees. The court's interpretation of this rule forms the basis for the decision in the present case.