The thorny issue of liability raised its head recently in a case involving the release of a container by a customs officer who was bribed by a clearing agent to issue a false release letter. When it was discovered that the container had never been examined and that the release was false, a penalty was imposed on the importer because his agent had bribed the customs official. But who is liable when the fraud is uncovered? The importer or the agent? To untangle the legal complexities we called on the expertise of Quintus van der Merwe and Zama Mgwedli of Shepstone & Wylie Attorneys who provided the following explanation: Where an innocent third party suffers a loss because of the wrongful behaviour of a customs official acting in the course and scope of his employ, SA Revenue Service may be held liable to claim for damages based on the principle of vicarious liability and the provisions of the State Liability Act No 20 of 1957. This position was upheld by the Supreme Court of Appeals in the matter of C: Sars and Another v TFN Diamond Cutting Works (Pty) Ltd 2005 (5) SA 104 (SCA) (67 SATC 171). Section 4(13) of the Customs and Excise Act No 91 of 1964 (“the Customs Act”) provides that customs officials cannot be held liable for any loss or damage arising out of any bona fide action of an officer under that section. Fraud cuts through everything, and is obviously not a bona fide act. The clearing and forwarding agent may escape liability in terms of the proviso to section 99(2) of the Customs Act, which makes provision for the liability of an agent for obligations imposed on its principal provided the agent has taken all reasonable steps to comply with the Customs Act, reported the contravention or non-fulfilment to Sars and was not party to the contravention. Clearly, where the customs officer is bribed by a clearing agent, the clearing agent could be held liable by Sars. The importer is in an invidious position, because section 98 of the Customs Act provides that the importer is responsible for any acts performed by its agent. This is premised on the basis that, in law, the importer would have a right of recourse against his agent. Notwithstanding the reverse onus on the importer to show due entry in terms of section 102 of the Customs Act, ie, sellers of goods to produce proof of payment of duty, where Sars alleges fraud, the onus of proof clearly lies with Sars. Authority for this can be found in AMI Forwarding (Pty) Ltd v Government of the Republic of South Africa (Department of Customs & Excise) & another [2010] JOL 25382 (SCA). It is therefore imperative that importers make use of third-party agents that they trust and agents that have implemented strong anti-bribery and corruption practices across their business. The transport industry is traditionally not very transparent and has only made a slow shift over the years to change this. Fraud, bribery, and other illegalities are endemic to some parts of the industry, and the world.
