Under the correct set of circumstances a party may treat an administrative act as void and await developments, which must not be ‘equated with contumacious disregard for the law by anarchists and legal delinquents’, according to a judgment of the Namibia High Court
The judgment stayed the implementation and application of the provisions of the notices and regulations that required:
- every registered insurer or registered reinsurer to cede to NamibRe the prescribed percentages of each short-term or long-term insurance contract issued or renewed in Namibia; and
- cession of each of the prescribed percentages of a reinsurance contract placed by a registered insurer or reinsurer in or outside Namibia.
On 20 September 2018, the High Court of Namibia gave judgment in the urgent application launched by the Minister of Finance and Namibia National Reinsurance Corporation Limited (NamibRe) (Applicants) against Hollard Insurance Company of Namibia Limited and 15 others (Respondents) who make up the insurance market in Namibia. The Applicants sought an order compelling the Respondents to comply with the notices and regulations issued under the Namibia National Reinsurance Act 1998. It is notable that the Chief Executives of several insurers were cited in their personal capacities and threatened with criminal contempt of court proceedings for defying the law.
The Respondents were, prior to the launch of the urgent application, placed on terms for non-compliance with the notices and regulations. Despite the promulgation of the notices and the demand from the Minister of Finance, the Respondents remained defiant. The Respondents contended that they would not comply with the notices and regulations pending a final determination of their constitutional law challenge alleging that the notices and regulations were void and raised a collateral challenge of voidness as their defence against the urgent application.
Of importance, the Respondents had, prior to the launch of the urgent application, instituted a constitutional law challenge against the notices and regulations, which they seek to set aside.
From the judgment it is apparent that there is a history between the applicant Minister and respondent insurers, which is evidenced by the striking-out of certain portions of the answering affidavits of the Respondents on the grounds that the content is scandalous, vexatious and irrelevant.
The result of the judgment is that the Respondents are not required to comply with the provisions of the notices and regulations pending the outcome of the court review. The reasoning for the finding is that, under the successful collateral challenge of voidness raised by the Respondents to the proceedings, it is a lawful defence to treat an administrative action as void and await developments.
It now remains to be seen whether legislation providing for an automatic cession of insurance proceeds collected by registered insurers and registered reinsurers in Namibia as contemplated in the notices and regulations will pass muster under the constitutional law challenge. The court urged the leadership of the court to see that the review is heard as soon as possible in the public interest.