Heinrich Schulze

BLC LLB (UP) LLD (Unisa) is a professor of law at the University of South Africa.

May 2007 (3) South African Law Reports 1 to 322 (week 1 – week 3); [2007] 2 All SA Law Reports vol 1 April no 1 (pp 1–125); and no 2 (pp 127–225)

Criminal law

A number of cases dealing with matters pertaining to criminal law were reported in the material under review. Two of these cases dealt with the concept of ‘instrumentality of an offence’ as defined in the Prevention of Organised Crime Act 121 of 1998.

Confiscation orders: The Schabir Shaik-saga has contributed yet another chapter to the law reports. Following the much publicised Schabir Shaik corruption appeal, the SCA’s decision on the validity of the confiscation order granted against Shaik has now been reported under the citation of Shaik and Others v S [2007] 2 All SA 150 (SCA).

In the criminal trial of Shaik and his co-accused, they were convicted of several offences. The relevant one for purposes of the present matter was the contravention of s 1(1)(a) of the Corruption Act 94 of 1992. Following the criminal proceedings, the prosecution applied for the holding of an inquiry under s 18(1) of the Prevention of Organised Crime Act 121 of 1998 (POCA) into such benefits as Shaik and his co-accused (the appellants) may have derived from the corruption offence. The confiscation order was granted and the appellants were ordered to pay the State three amounts. The first was the value of the appellants’ shareholding in a company which was part of the consortium which won a munitions contract. The shareholding was acquired as a result of the first appellant’s (Shaik’ s) corruptly obtaining intervention by the former Deputy-President. The second amount comprised dividends paid in respect of that shareholding, and the third amount represented the value of the appellants’ shareholding in another company.

In a joint judgment (the Bench consisted of Howie P, Mpati DP, Steicher, Navsa and Heher JJA) the court held that the State had satisfactorily proved the connection between the first two amounts payable by the appellants in terms of the confiscation order and the offence of corruption. Put differently, the amounts were indeed instrumentalities of the offence as contemplated by POCA.

But the same connection had not been proved in respect of the third amount and the offence of corruption. Although the amount which was payable in terms of the confiscation order constituted proceeds which were received as a consequence of the unlawful activity, it was not a consequence that was necessary for achieving the object of the unlawful activity and the appellants did not intend to derive a financial benefit as a result of the share transaction, and did not do so. The court a quo should therefore not have ordered the appellants to pay the third amount to the State. The appeal was thus dismissed in respect of the first two payments, and upheld in respect of the third payment.

With acknowledgements to Heinrich Schulze and De Rebus.