1. The Values inherent in the Right
Although the above analysis of the Constitution leads to the conclusion that sale in execution for less than it is worth is unconstitutional, there is another view of the Constitution that makes the point is an arguably stronger manner. This view points out that Constitutional law is not simply about balancing one thing against another in terms of utilitarian calculus. Rather fundamental rights should be seen as deontological values that ‘trump’ the normal business of political compromises and weightings.[1] This analysis sees rights as “firewalls” (Habermas), “trumps” (Dworkin) or “shields” (Schauer). This should not be taken in an absolute sense that rights do or should ‘trump” the cost benefit analysis in every case even when the costs of enforcing a right are massive and the value of enforcing the right small. Dworkin accepts that[2] as does Bilchitz in his concept of pragmatic minimum threshold.[3] Schauers analysis makes the right presumptive but not conclusive.[4] Even Robert Alexy, who generally favours balancing, allows for different weighting depending on the views of the political community.[5] In most political communities, a person’s home is considered a very important value.
However, rights can be far more of the nature of trumps, excepting extreme circumstances, than they are in the practice of simply balancing costs and benefits. Many examples for when that is needed are provided in any standard critique of utilitarianism, or consequentialism, on deontological (often Kantian) grounds.[6],[7]
The first stage of the constitutional process and the consideration of the nature of right in the second stage are thus important and should be given more emphasis.[8] Further, Alexy suggests that the greater the violating of the right, the greater the degree of evidence that should be required. It is certainly possible and necessary to give greater weight to certain rights that a pure utilitarian perspective would require.
This is connected with the idea that the values inherent in the rights should be more rigorously developed. Bilchitz argues that there are two sources of human rights: having positive experiences and the ability to fulfil a diversity of purposes.[9] In our terms the sale in execution process denies these in a number of ways in its current form. The experience of having one’s own home; on being able to change and customise one’s own home (as opposed to renting); and on seeing financial growth over time through owning ones one home. The judgment itself will generally deny the debtor the option of owning another, even a smaller home, at least for five years. It may also deny her ability to rent or get a job or to pursue the line of business in which she has the greatest market value. At the very least the diversity of options in renting or working in likely often to be severely restricted.
Although this theory attempts to be applicable to a great number of sources of value that vary between individuals, the application is easy in this case: the value placed on the home is in fact remarkable common against the whole human[10] population and throughout history. Thus Lieberman’s argument[11] that Bilchitz’s view is too universal would not hold in this subject matter area.
On the other hand, the rights of creditors against debtors, is more the kind of relationship described by Liebenberg in her concept of rights based on dialog that resist final closure and completeness.[12] Banking law has been in the past far more draconian than today. From the practice of selling people into slavery to pay their debts[13] to the debtors prisons of Victorian times, our debtors rights have been very different from today. The proposals in this document are perhaps another step in the dialogue that brings bank practice more in line with our Constitutional values and order. The National Credit Act and the judgements in Jafta, Gundwana et al, have still left iniquities in the system. This then leads to the current “conversation”.
Yet the continuing fluidity of the right over time does not necessarily imply value pluralism. The vast majority of the population (and even bank employees) believe that selling people’s houses for significantly less than they are worth when they default is wrong.[14]
In most cases, taking seriously the values component of constitutional rights will have budgetary implications; not in this case. There would be no need to consider the effect on government’s scarce resources in a Constitutional Court decision as recommended by this document. The costs if any would be borne by large banks to whom it would a drop in the ocean compared to both their assets and their annual income.[15]
Bilchitz applies the theory directly with inter alia the case of Grootboom[16] alleging that the case pays insufficient attention to the content of the right. He argues for a “minimum core”[17] that would at least insure the survival of the individuals. In our case we should consider that while most sales in execution will not risk the actual survival of the victims of the process, at the lowest socio- economic levels, to deny a person the capacity to have a bond (on a smaller house) , to rent and to a job[18] may in some cases endanger their survival. For a person not brought up in a township to be forced to live there, may be dangerous, especially where that person might be from another African country and not be a South African citizen. Further the very process of eviction may be threatening to survival. In an illegal eviction in the townships police officers have allegedly thrown an old lady from a township in the back of a police van to remove her from the premises and intimidate her to leave.[19] This can lead to threats to survival in such vulnerable people.
Bilchitz then offers some situations where the minimum core does not apply: (1) when there are not enough resources to fulfil the obligations; (2) when disproportionate resources would need to be applied to few individuals; (3) in order to ensure some individuals can pursue goals beyond minimum core; (4) when applying minimum core to some, would deny it to others. None of these would apply in this case where the destruction of the minimum core by sale in executions for less than value, can be prevented without destroying the minimum core obligations of others, disproportionately allocating resources to a few, or prevent others from pursuing goals beyond the minimum core. As argued in the Section relating to the Right to Housing, there are no problems with insufficient resources in this case.
Lieberman goes on to argue that a minimum core argument of “survival” might be used to justify a minimalist approach to social justice as people can survive on very little[20] On the other hand expensive health care solutions are required to deal with “survival” in a urgent, medical emergency situation. There is thus the need for some pragmatic justification even for value based approaches. This does not however reduce the approach back to the raw utilitarianism of a purely balancing approach.
A minimum core based on survival might also ignore or deprioritised other important values[21] but this is not an argument that would reduce us to a purely balancing approach. It is possible that a minimum core could be developed concretising the other rights mentioned (dignity, freedom, etc).[22] Some of these minimum cores are already present (for example habeas corpus would be part of the minimum core for freedom); some need developed. This could be a third principle between minimum core for survival and ability to achieve ones goals, or could be seen as equal to the first ‘survival’ minimum core. A minimum core for housing might ban sales in execution at less than value and incorporate the other policy changes that are discussed in the chapter on remedies. Such an approach also deals with the problem that the minimum survival criteria might then become a justification for doing too little. In any case Bilchitz responds that minimum criteria are a starting point for progressive realisation and not the end of the matter.[23]
The goal must be to provide principles that however contingent, reviewable and incomplete seek to provide some further content to constitutional rights. Such principles in the sale in execution[24] should be that sale in execution should be a genuine last resort, and supporting sub principles would be
- No house should be sold in execution when the borrower now has a job or income that could pay off the mortgage with the term of the loan or his normal working life.
- No house should be sold in execution unless the equity in the property is less than 15%
- No house should be sold in execution at an auction without a reserve price.
- No house should be sold by sheriff’s auction without at least one year of it being actively marketed by estate agents, including ones of the judgment debtors choosing should he or she wish.
- A bank will not be able to claim any deficit against a judgment debtor when it sells a house for less than the amount of the bond.
- A bank will be liable for the amount of the deficit when it sells a property for under fair market value of the property at the state that it is in.
These principles may be refined by “dialog” but provide a definitive example of solid principles that a court could use pending any further conversations that might give rise to better principles and sub principles.
Even a scenario that provided a positive socio–economic outcome[25] may not adequately deal with the content of the right.[26] First, the content of the right must be understood and only then should the reasonableness analysis and the balancing criteria inherent therein take place. Many characteristics that the court already takes into account such as urgency; short, medium and long term criteria; exclusion and thinking of the impact on those who cannot pay would be better classified as part of the content of the right rather than as part of the reasonableness criteria.[27]
[1] Biltchitz “Does balancing adequately capture the nature of rights?” in Woolmand and Biltchitz (eds) Is this Seat Taken
[2] Biltchitz “Does balancing adequately capture the nature of rights?” in Woolmand and Biltchitz (eds) Is this Seat Taken p425
[3] Liebenberg Book Review of “Poverty and Fundamental Rights” (2007) (Oxford: Oxford University Press) p887. See below for further discussion.
[4] Liebenberg Book Review of “Poverty and Fundamental Rights” (2007) (Oxford: Oxford University Press) p888
[5] Biltchitz “Does balancing adequately capture the nature of rights?” in Woolmand and Biltchitz (eds) Is this Seat Taken p430
[6] Biltchitz “Does balancing adequately capture the nature of rights?” in Woolmand and Biltchitz (eds) Is this Seat Taken p430 n36
[7] CBT coherent?
[8] Biltchitz “Does balancing adequately capture the nature of rights?” in Woolmand and Biltchitz (eds) Is this Seat Taken p432
[9] Bilchitz Poverty and Fundamental Rights (2007) (Oxford: Oxford University Press); Liebenberg Book Review of “Poverty and Fundamental Rights” (2007) (Oxford: Oxford University Press)
[10] And animal for that matter.
[11] Liebenberg Book Review of “Poverty and Fundamental Rights” (2007) (Oxford: Oxford University Press) p886
[12] Bilchitz “Does Sandra Lieberberg’s New Book provide a viable approach to adjudicating Socio – Economic rights” p547
[13] Bible: Exodus 22: 1-4
[14] Studies by the author with about 30 persons.
[15] Even compensating everyone whose house they had sold for less than value for the last 20 years is estimated at R60 billion, which while a lot of money in absolute terms is only around one year’s income for the big four banks. If the court decided only to compensate those currently taking cases to the courts, then the costs might be only R50 million, less an thousandth of one year’s income.
[16] Government of the RSA and others v Grootboom and others 2000 (11) BCLR 1169 (CC); 2001 (1) SA 46 (CC) see discussion under the Section on the Right to Housing.
[17] Though this approach was rejected in both Grootboom (above) and Minister of Health v Treatment Action Campaign (2) 2002 (5) SA 721 (CC)
[18] A judgment may make it difficult to get a rental or a job,
[19] Case known to the author
[20] Liebenberg Book Review of “Poverty and Fundamental Rights” (2007) (Oxford: Oxford University Press) p886
[21] Liebenberg Book Review of “Poverty and Fundamental Rights” (2007) (Oxford: Oxford University Press) p888
[22] See Bilchitz “Does Sandra Lieberberg’s New Book provide a viable approach to adjudicating Socio – Economic rights” p554. A minimum core for water appears feasible from this analysis.
[23] Bilchitz “Does Sandra Lieberberg’s New Book provide a viable approach to adjudicating Socio – Economic rights” p555
[24] Which is at a lower, narrower level of analysis but analogous with broader principles of constitutional interpretation.
[25] Minister of Health v Treatment Action Campaign (2) 2002 (5) SA 721 (CC)
[26] Biltchitz “Towards a Reasonable Approach to the Minimum Core: Laying the Foundations for Future Socio-Economic Rights Jurisprudence” in 19(1) South African Journal of Human Rights 1-26 (2003) p9
[27] Biltchitz “Towards a Reasonable Approach to the Minimum Core: Laying the Foundations for Future Socio-Economic Rights Jurisprudence” in 19(1) South African Journal of Human Rights 1-26 (2003) p9