BBBEE Commission’s fronting decision is set aside by High Court as an unreasonable decision
On 28 January 2022, the Gauteng High Court set aside a decision of the BBBEE Commission in relation to a fronting complaint against Cargo Carriers (Pty) Ltd relating to its owner-driver programme. The BBBEE Commission had made various findings against Cargo Carriers, including that Cargo Carriers had deprived the complainants the economic benefits they reasonably anticipated from the proceeds of the deliveries they were making as truck drivers and being part of the Owner Driver initiative. The Commission found that conduct of Cargo Carriers was contrary to the objectives of the BBBEE Act and may amount to fronting practice. The Commission recommended that Cargo Carriers pay reasonable compensation with the calculation thereof to be approved by the BBBEE Commission although no sanction was issued against Cargo Carriers.
The High Court found that several of the factual findings made by the BBBEE Commission were incorrect, such as the finding that Cargo Carriers had achieved BBBEE scorecard points as a result of the owner-driver programme and that the owner drivers did not receive appropriate training. The Court found that not a single jurisdictional fact for fronting had been established by the BBBEE Commission and there was no misrepresentation to the complainants.
The High Court found that the BBBEE Commission had violated sections 6(2)(h) and 6(2)(e)(iii) of the Promotion of Administrative Justice Act which entitles a court to set out a decision of an administrative body if :
- “irrelevant considerations were taken into account or relevant considerations were not considered” or
- “the exercise of the power or the performance of the function authorised by the empowering provision, … is so unreasonable that no reasonable person could have so exercised the power or performed the function.”
All the findings of the BBBEE Commission against Cargo Carriers were reviewed and set aside with costs payable by the BBBEE Commission.
For more information, please contact Erika Holmes at email@example.com or 031 5757410.