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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:The draft legislation concerning public interest actions and class actions: the answer to all class ills?
Author:Hurter, EstelleISNI
Periodical:The Comparative and International Law Journal of Southern Africa
Geographic term:South Africa
company law
Abstract:Although the terms 'class rights' and 'class actions' are not alien to South African company law, these terms have generally not been part of the legal parlance. The 1996 Constitution has formally introduced class actions into South African law. The type of class action envisaged in the Constitution is limited to the protection of the fundamental rights set out in chapter two. The protection is directed at the contents of all legislation and in respect of administrative decisions by the State. Because of this limitation the South African Law Commission recommended that 'legislative intervention in the form of an act of Parliament is necessary to make provision for class actions' and proposed draft legislation. The American class action is generally considered an effective class remedy. The question arises whether or not the class action, as contained in the Law Commission's proposed legislation, will present an equally useful remedy for minority shareholders if applied to company law in South Africa. To determine this the present article first examines the American law relating to class actions. It concludes that although the proposed class action has the potential to be utilized as a remedy by minority shareholders in South African company law, there is serious doubt about its effectiveness, chiefly because of the power of the court to order that costs be secured. Notes, ref.