Name of Legislation:
State Liability Amendment Act No. 14 of 2011 (‘new legislation’).

Commencement date:
 30 August 2011.

 Re:
The satisfying of a final court order granted against the state sounding in money.

Reason for the Amendment:
In Nyathi v Member of the Executive Council for the Department of Health Gauteng and Another 2008 (5) SA 94 (CC), Section 3 of the State Liability Amendment Act 20 of 1957 (‘previous legislation’) was declared unconstitutional. The previous legislation prohibited the attachment of state property in order to satisfy final court orders sounding in money (‘judgment debt’).

Procedure to attach property of the state in order to satisfy judgment debt according to the new legislation:
Once a court order has been made final against the state, the State Attorney has 7 days to inform the Executive Authority (‘relevant Department’), the Accounting Officer of that department (‘Accounting Officer’), and the Treasury relevant to that department (‘the Treasury’) of the final order.

The judgment is to be satisfied by the relevant Department within 30 days of the final order being granted or within a time period agreed upon between the Accounting Officer and the Judgment Creditor. All payments are to be charged against the budget of the relevant Department.

If the judgment is not satisfied within 30 days, the Judgment Creditor may then serve the court order on the relevant Department, the Accounting Officer, the State Attorney and the Treasury. The Treasury must ensure that the order is satisfied within 14 days of having the order served on it.

If the Treasury fails to satisfy judgment within 14 days, then the Judgment Creditor may issue a writ of execution against the movable property of the relevant Department. The Sheriff may then attach such movable property of the relevant Department but may not, at this stage, remove such property.

During the attachment stage, the Sheriff and the Accounting Officer may come to an agreement on which property may not be attached, removed and sold in execution (‘the excluded property’). This may only be done if attachment of the excluded property will result in the disruption of service delivery, any threat of life or where the security of the public at may be placed at risk. If no such agreement is reached, the Sheriff may attach any movables which he believes will satisfy the judgment debt.

After 30 days have passed from the date of attachment, the Sheriff may then remove and sell said movable property.

An affected party may make an application, before the sale of execution, to stay the sale where it is believed the sale of the movables will result in the disruption of service delivery, any threat of life or where the security of the public at may be placed at risk. Notice of such application must be served on the Judgment Creditor and on the Sheriff. If such an application is made by the relevant Department, they must include a list of replacement movable property that may be attached and sold in execution of the judgment debt.

Liability of the Accounting Officer:
The new legislation places a heavy burden on the Accounting Officer of the relevant Department, in so far that if the Treasury has to satisfy the judgment debt after the expiration of the initial 30 days after the final order is granted, the Accounting Officer is held to be responsible, liable and accountable (section 3(13) (a) and (b) and Section 16) and is guilty of financial misconduct in terms of the Public Finance Management Act No. 1 of 1999 which would carry a penalty of imprisonment of a period not exceeding 5 years.

Does the new legislation apply retrospectively?
No, the old provisions apply if court order was granted before the commencement of the new legislation

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