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[2022] ZAWCHC 40
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Agenbach v Lutzville 1999 Co-operative Limited (A235/2021) [2022] ZAWCHC 40 (23 March 2022)

IN THE HIGH COURT OF
SOUTH AFRICA
(WESTERN CAPE
DIVISION, CAPE TOWN)
Case No: A235/2021
Court a quo Case No:
RCATL02/13
In
the matter between:
AJ AGENBACH
Appellant
and
LUTZVILLE
1999 CO-OPERATIVE LIMITED
Respondent
JUDGMENT DELIVERED
ELECTRONICALLY: WEDNESDAY, 23 MARCH 2022
NZIWENI AJ
Introduction
[1]
This is an appeal against the judgment of the Regional Court
Magistrate.  In
this judgment for the sake of convenience,
the parties will be cited as they were referred to in
the court
a quo
, namely the Appellant as the Defendant and the
Respondent as the Plaintiff.
[2]
The Plaintiff is a Co-Operative duly incorporated in terms of the
Co-Operatives Act,
14 of 2005 (the Co-Operative Act).  It is
common cause in this matter that the Defendant, a farmer, at all
material times
was a member of the Plaintiff in terms of the
constitution of the Plaintiff.   The Defendant became a
member of the Plaintiff
before or, during 1998 until the termination
of his membership on or about 30 May 2013.   This was
admitted by the Defendant
in his response to Plaintiff’s
request for trial particulars.   The Defendant further
admitted in his response
to the Plaintiff’s request for trial
particulars, that he delivered grapes to the Plaintiff for a number
of years in accordance
with his rights and obligations as one of the
Plaintiff’s members.
[3]
The amended particulars of claim aver that rights and obligations
under the Plaintiff’s
constitution were conferred to the
Defendant, at the relevant time.
[4]
Furthermore, the amended particulars of claim quote the relevant
express terms of
the Plaintiff’s constitution.  I will
however cite only one term, quoted as follows:
“
. . . The
Plaintiff’s board of directors (‘The Board”)
determines annually a commission/fixed costs (“the
commission”)
that is recovered from the members in order to satisfy the
Plaintiff’s and Lutziville Vineyards Limited’s

(hereinafter referred to as “the Company “) income and
capital requirements.  The commission may be recovered
from
members based on their delivery of grapes during that year or based
on their pressing quota (parskwota’) at the Plaintiff.

The commission shall be limited to the Plaintiff’s and the
Company’s fixed costs, which fixed costs consist of the

following items . . .”
[5]
It is further common cause that on 2 October 2000, the Plaintiff
concluded a processing agreement
(‘verwerkingsooreenkoms’)
with Lutzville Vineyards Ltd.  On 20 April 2000, the
‘verwerkingsooreenkoms’
became effective.   On
10 December 2004, the Plaintiff and the Defendant concluded a
“Leweringsooreenkoms, which
came into effect on 1 January
2005”.
[6]
The Plaintiff instituted an action against the Defendant in the
Atlantis Regional
Court.  The Plaintiff’s claims are set
out under three headings for payment of monies.  According to
the particulars
of claim, the claim for payment of monies is in
respect of ‘fixed costs’, which are recoverable from the
Defendant
in terms of the Plaintiff’s constitutions.   In
a nutshell, the Plaintiff sued the Defendant for
the
non-delivery of grapes in accordance with its constitution.
[7]
In the court below, the only party that presented oral evidence was
the Plaintiff.
The Plaintiff, called two witnesses in its
endeavour to prove that it was entitled to the prayers sought.  At
the close
of the Plaintiff’s case, the Defendant brought an
application for absolution from the instance.    On 31
March
2021, the Regional Court Magistrate delivered her judgment on
absolution from the instance.  She dismissed the application
for
absolution from the instance with costs.
[8]
It is of note that the Defendant, pursuant to the dismissal of the
application for
absolution from the instance, closed his case without
leading oral evidence.  After the Defendant closed his case, the
Regional
Court Magistrate, in her judgment delivered on 20 August
2021, granted judgment in favour of the Plaintiff.  The
Defendant
now appeals against the cost order granted on 31 March
2021, and the whole judgment of the 20 August 2021, (the main
judgment including
costs).
[9]
At the trial, the Defendant’s defence proceeded principally on
two distinct
components. This is so because in his defence, the
Defendant raised two special pleas. Firstly, the Defendant challenged
the
locus standi
of the Plaintiff and or failure by the
Plaintiff to join a necessary party (non-joinder).  Secondly,
the Defendant pleaded
that the conduct of the Plaintiff’s
business was contrary to the co-operative principles. It is further
contended on behalf
of the Defendant that the Plaintiff was not
operational as contemplated in the Co-operative Act.  Consequently,
the Plaintiff
cannot recover any monies it claims to be due to it.
[10]
The first component of the Defendant’s defence can be described
in the following way:
(a)  The Plaintiff
ceded all its rights, title and interests to claim the amounts set
out in its particulars of claim to Lutzville
Vineyards Ltd. In the
premises, the Plaintiff has no claim against the Defendant.
(b)  The Plaintiff
failed to join the necessary party; Lutzville Vineyards Ltd which
should have been joined as a co-plaintiff
to claim the monies due to
it.
[11]
The second component of the Defendant’s defence can be outlined
as follows:
(a)  The Plaintiff
did not conduct any business.
[12]
The Defendant also advanced further arguments along the following
lines:
(a)  That the
Plaintiff’s Constitution/s are in contravention of certain
sections of the Competition Act, 89 of 1998
(the
Competition Act);
and
they stand to be declared void and unenforceable by the
Competition Tribunal;
(b)   Accordingly,
the jurisdiction of the court a quo was ousted, in terms of
section
65
(2) (b) of the
Competition Act, as
the matter had to be referred
to the Competitions Tribunal for its adjudication.
[13]
At the commencement of the trial, it was agreed that the
preliminary points were to be determined
simultaneously with the
merits.   It is also worth noting that at commencement of
trial, counsel on behalf of the Plaintiff
stated the following in the
opening remarks:
“
Your Worship of
some importance there are two special pleas that have been raised by
the defendant my learned friend and I discussed
the issue, because of
the fact
that there will be a substantial
overlapping dealing with the special pleas and merits.
We think it is going to be . . . it will not be an effective use of
judicial time to deal with those separate and that it
would make
sense to deal with all the evidence at once . . .”
[14]
Some of the issues between the parties concerned the proper
construction of the agreement entered into
between the Plaintiff and
Lutzville Vineyards Ltd (‘verwerkingsooreenkoms’),
various others statutes are not points
of interpretation.
[15]
It is a curious feature of this case that this court is also asked to
determine whether the nature
of the reasons given by the Regional
Magistrate can bear scrutiny.
[16]
The central issues for determination in this matter can be summarised
as follows:
(a)  Whether the
nature of the reasons for the findings of the Regional Court
Magistrate; is a stand-alone ground for appeal.
Rearticulated,
this court is also tasked with the duty of determining whether, there
are deficiencies in the judgment
of the trial court, and if such
deficiencies exist; whether if they are taken together with the trial
record as a whole, excludes
a meaningful appeal.
(b)  If this Court
finds that the judgment of the court
a quo
is adequate, then
the next enquiry is whether the findings of the court below inclusive
of the cost orders are correct.
(b1) Whether the
preliminary points raised by the defendant during the trial should
have been sustained.
(b2) Whether the cost
order granted by the Regional Court Magistrate on 31 March 2021 is a
competent cost order.
(b3) Condonation by the
Defendant for the late noting of the appeal against the cost order of
the 31 March 2021, and for the late
filing of the Defendant’s
application for an appeal hearing date.
Condonation
[17]
It is my firm view that the Defendant has furnished sufficient
grounds for the delay.  Consequently,
the failure to comply with
the Court’s Rules is hereby condoned.
[18]
I propose to deal with the different aspects of this appeal in the
following fashion.
The nature of the
judgment of the court below.
[19]
Reasons behind the findings of a trial court plays a significant role
in court proceedings.  The
task of giving reasons
is
inherent in a presiding officer’s role.
In
accordance with the well-established principles set out by the
Courts, the function of giving reasons for judgment is always

integrally and fundamentally embedded  in the concept of
judicial accountability.
[20]
The duty of giving reasons is an obligation
owed
to the public at large
. The parties and the public in general
justifiably expect that judicial officers should account through
their reasons for the decisions
they make.    It is
thus expected of every judicial officer to be answerable for his/her
decision through the mechanism
of giving reasons.  In order to
enhance the objective that justice should be seen to be done,
judicial officers must recognise
the need to articulate, justify and
explain the reasons for their actions or results.
The consequence of this
is that, where inadequate reasons are given for a finding, that can
make the entire proceedings to be susceptible
to be set aside on
appeal.
[21]
The Defendant in this matter has assailed the
nature of the reasons given by the Regional Magistrate.  The
reasons have been
described as scant,
poorly expressed
and
construed and do not constitute meaningful reasons at all.
It
is thus asserted
inter alia
on behalf of the Defendant that
the reasons given by the trial court are inadequate and scant.
Additionally, it is the contention
of the Defendant that it is not
discernible at all as to how the Regional Court Magistrate reached
her decision.
M
oreover, before this
Court, the Defendant raises the nature of the trial court’s
judgment as a self-standing ground of appeal,
which should justify
its reversal by this Court.
[22]
If regard is had to the reasons given by the court
below for its finding, the Defendant cannot be faulted for his
sentiments regarding
the nature of the reasons.
It is
true that a party to proceedings
should not be
left in doubt about why a finding went against it.  It is clear
therefor, that a judicial officer should always
be mindful of the
task of giving reasons and always strive to give well-articulated
reasons.
[23]
Of course, a judicial officer is not held to an abstract standard of
perfection.  It is only expected
that the judicial officer
should provide reasons that adhere to the required standard.
[24]
It is true and worth noting that under certain
circumstances,
absence of sufficient reasons, can lead to a
finding that the Court of Appeal could not carry out its appellate
function. Thus,
at times inadequate reasons can be considered a
material defect that warrants the setting aside of a judgment
altogether.
[25]
However, it is to be noted that where the nature of the reasons for
the judgment are concerned,
not every failure or
deficiency in the reasons provides a ground of appeal.
[26]
This
Court cannot simply set aside the proceedings because the
trial court did a poor job of expressing itself. Partly this is
because at times the basis for the finding may be
apparent from the record. Put in another way,
when the
finding is in any event sustainable on the evidence or where the
circumstances of the case manifests the grounds of the
conclusion, a
matter cannot be set aside because of inadequate reasons.
[27]
Consequently, deficient reasons do not
automatically mean that an appeal should succeed solely based on
that.
[28]
I am stating this at the cost of repeating myself
that,
in order for the party to succeed based on the claim of insufficient,
or unclear reasons, it must be shown that the judgment
was incorrect
and thus be set aside. Thus, whether insufficient or unclear reasons
warrant setting aside of the decision of the
trial court will
differ
from case to case.
[29]
Turning to the present case, the vital question to be answered here
would be;
whether this Court sitting as an Appeal
Court, is able to discern how the court
a
quo
reached its finding and whether the
finding is borne out by evidence.
In the determination as to whether the findings of the trial court
are
well based on the evidence, regard has to be given,
amongst others, to the nature of the subject matter before the trial
court.
For instance, it cannot be said in the case in
casu
,
that the matter was one which called for, or demanded from the
Regional Magistrate, critical examination of evidence.   In

the instant case, it is worth noting that oral evidence was not
tendered by both sides but only by the Plaintiff.  Thus, the

present case rested chiefly on the evidence tendered by the
Plaintiff.
[30]
Insofar as the credibility of the Plaintiff’s witnesses the
magistrate expressed the following
sentiments:
“
This court cannot
find that the evidence of the Plaintiff’s witnesses are either
reliable, credible, probable and (sic) logical.”
[31]
With the benefit of the complete record, I cannot comprehend how the
credibility findings made about
the Plaintiff’s witnesses are
justified.
[32]
I am mindful to the fact that credibility must be assessed in light
of all evidence.  On examination
of the evidence and the
circumstances of this case, the record does not support the trial
court’s finding that the Plaintiff’s
witnesses were not
credible or reliable.
[33]
It is also significant to note that the evidence of the Plaintiff’s
expert witness was not disputed
by producing countervailing expert
evidence.   In the present case,
there
were no noteworthy inconsistencies or conflicts in the evidence.
There was thus no need to resolve
tangled
or contradictory evidence on key aspects by the Regional
Magistrate.   Additionally,
the case did not turn on
credibility.  The credibility of the Plaintiff’s witnesses
was also not assailed during this
appeal.  It appears to me,
therefore, that, as far as the trial court’s assessment of the
credibility of the Plaintiff’s
witness and the expert witness
are concerned, they are not borne out, or cannot be supported on any
reasonable perspective of the
evidence.  Consequently, the
credibility findings of the court below can be ignored by this Court.
[34]
In light of the fact that during the trial, the Defendant closed his
case without leading evidence
strongly suggest that the appeal in
this matter is directed at the findings rather than the reasons for
the findings.
The Regional Magistrate’s
finding is obvious from the record, even without being articulated in
reasons.
[35]
Whilst the trial court’s reasons for her findings are
not clear, if regard is had to the record, it is not difficult to
understand
the reasoning behind her finding.  The nature of the
evidence, which was led during the trial,
is
easily
identifiable from the rest of the
record. This in turn allows this Court to determine the correctness
of the lower court’s
decision.
[36]
Equally important, albeit the trial court’s reasons are
lacking, but given the circumstances
of this case, this Court,
sitting as the Appeal Court is able to explain the results to the
parties. It cannot be said that the
conclusion of the trial court is
unreasonable or unsupported by evidence.
Thus,
there is no need in this case for the trial to start de novo or for
the proceedings to be set aside
.
Jurisdiction /
Competition Act
[37
]
Turning to the aspect as to whether the Jurisdiction of the Regional
Court was ousted by the provisions
of the
Competition Act.  At
the outset I wish to point out that during the testimony of the
Plaintiff’s witness, Mr. Mostert (Mostert);  was referred

to correspondence written by the Competition Commission. Gleaning
from the same document, it is evident that the Competition Commission

decided not to refer the complaint against the Plaintiff regarding
commission of a prohibited practice, to the Competition Tribunal.
[38]
Section 50
of the
Competition Act states
the following:
“
Outcome of
complaint
50. After completing its
investigation the Competition Commission must-
(a) refer the matter to
the Competition Tribunal, if it determines that a
prohibited
practice
has been established; or
(b) in any other case,
issue a notice of non-referral to the
complainant
in
the
prescribed
form.”
[39]
Section 51
(1) of the
Competition Act states
the following:
“
(1) If the
Competition Commission issues a notice of non-referral in response to
a complaint, the
complainant
may
refer the complaint directly to the Competition Tribunal, subject to
its rules of procedure.”
[40]
In the present case, of course, the Defendant was at pains to point
out, that the jurisdiction of the
Regional Court to conduct the trial
was ousted in terms of
section 65
of the
Competition Act.  According
to the Defendant, this is so because the Plaintiff’s
Constitution and its implementation constitutes prohibited conduct as

contemplated in
sections 8
and
9
of the
Competition Act.  As
mentioned previously, this particular challenge was raised during the
trial and evidently, it was not successful.
[41]
It is significant to note that the evidence of Mostert, reveals that
in early February 2013, an investigation
by the Competition
Commission was already underway. This was pursuant to a complaint
which was lodged by a member of the Plaintiff.
According to
Mostert, during this critical time, a group of farmers were opposed
to the registration of the constitution and the
Defendant’s
name appeared on the list of the farmers who were opposed to the
registration of the Constitution.  The
complaint was that the
Plaintiff was a monopoly and farmers could not deliver their grapes
to other parties.  The Competition
Commission
on 21 March
2013
dismissed the complaint.  Furthermore, Mostert read
a
letter dated 21 February 2013
, from Werksmans Attorneys, into the
record, purportedly written on behalf of the Defendant.
[42]
It is convenient to quote the contents of the letter.
“
1.
We confirm that we act on behalf of Mr. AJ Agenbag (“our
client”).
2. ...
3. It is common cause
that the Competition Commission is currently investigating a
complainant of ant-competitive conduct, in respect
of Lutzville 1999
Co-operative Limited and Lutzville Vineyards Limited’s
(“Lutzville”) business practices. A
particular aspect of
the conduct which is being investigated relates to Lutzville’s
levying of commission and penalties against
producers who have not
met their full quota requirements.
4. Further to the above,
we are currently defending a claim Lutzville instituted against our
client, under case number RCATL02/2013
in the Atlantis Regional Court
in respect of money Lutzville claims is owned to it for the
no-delivery of grapes by our client
in accordance with its Statute.
We are of the opinion that any claim in respect of commission and
penalties allegedly owing by
our client to Lutzville amounts to a
prohibited practice in terms of the Competition Act 89 of 1998 (“the
Competition Act&rdquo
;). In addition any such claim is premature as
the investigation by the Competition Commission is still underway.
5. It is our instruction
that our client accepts Lutzville’s offer to cancel and retract
his shares and “parskwota”
in Lutzville subject to
Lutzville abandoning all past or future claims of whatsoever nature
it may have against our client.
6. We further place on
record that Lutzville is not entitled to levy any penalties against
our client in terms of Article 44 of
the Statute or any claim any
other outstanding commission, levels or penalties as provided for in
the Lutzville Statute, as same
forms subject matter of the current
complaint before the Competition Commission and amounts to a
prohibited practice in terms of
sections 5
and
8
of the
Competition
Act.
7 . . .”
[43]
It is common cause in this matter that on the 28 March 2013, the
Competition Commission issued a notice
of non-referral of complaint,
concerning John Conroy Smuts against the Lutzville 1999 Co-Operative
Limited [The Plaintiff] and
Lutzville Vineyards Limited.  It is
also not disputed that the Competition Commission after it concluded
its investigation,
decided that the Lutzville statutes were not
restrictive.
[44]
Central to this issue is that, in
a letter
also dated 28 March 2013, the Competition Commission further informed
the complainant that if he disagrees with the Commission’s

decision, he
has 20 business days, after
the date of issue of the Notice of Non-Referral, to refer the
complaint to the Tribunal
.
[45]
Section 65
of the
Competition Act,
which
is the key provision
in this issue,
provides as follows:
65
‘
Civil actions and jurisdiction
(1) Nothing in
this
Act
renders void a provision of an
agreement
that,
in terms of
this Act
, is prohibited or may be declared
void, unless the Competition Tribunal or Competition Appeal Court
declares that provision to
be void.
(2) If, in any action in
a
civil court
, a party raises an issue concerning conduct
that is prohibited in terms of
this Act
, that court must
not consider that issue on its merits, and—
(a) if the issue raised
is one in respect of which the Competition Tribunal or Competition
Appeal Court has made an order, the court
must apply the
determination of the Tribunal or the Competition Appeal Court to the
issue; or
(b) otherwise, the court
must refer that issue to the Tribunal to be considered on its merits,
if the court is satisfied that—
(i) the issue has not
been raised in a frivolous or vexatious manner; and
(ii) the resolution of
that issue is required to determine the final outcome of the action.
(3) ...
(4) ...
(5) ...”
[46]
In the present case, when regard is to be had to this particular
challenge, it is quite noticeable
that the party, who raised this
challenge, did not adduce any evidence during the trial.
I have   also borne
in mind that the law is well settled
that a plaintiff bears the onus to prove that the court has
jurisdiction.
However, that does not detract from the fact that
there are instances where it can be required that; where a defendant
raises a
defence of jurisdiction, he or she cannot simply close and
dispose of a case without placing certain facts before court.
[47]
It is to be emphasised that the Plaintiff put facts before the court
below and that the Competition
Commission has already decided the
matter of dominance.   Furthermore, it is quite clear from
the testimony of Mostert
and the letter dated 21 February 2013, by
Werksmans Attorneys on behalf of the Defendant, that the Defendant
was part of the group
of farmers who lodged the complaint with the
Competition Commission.  The evidence further evinces that the
Competition Commission
notified the complainant when it issued the
notice of non–referral that if the complainant still desires to
refer the complaint
to the tribunal, this should be done within 20
business days.
[48]
An
ex facie
consideration of the court a quo record, makes it
evident that the trial commenced only in 2019, notwithstanding the
fact that
the summons was issued some years prior to that.
[49]
I have no hesitation in saying that, as far as the objection to the
jurisdiction of the Regional Court
is concerned, the Plaintiff’s
version has been consistent throughout.  For instance, when the
Plaintiff was responding
to the Defendant’s amended plea, it
stated that the alleged contravention to which the Defendant refers,
has already been
referred to the Competition Commission and the
Competition Commission has concluded that the Plaintiff’s
constitution is
not restrictive and does not contravene the
Competition Act.
>
[50]
Therefore, all along the Defendant knew what the Plaintiff was going
to say during the trial regarding
this particular objection.
While I do not think that it is always necessary that a legal
argument should always have an accompaniment
of evidence, in certain
circumstances, absence of evidence from one party entails the
acceptance of the evidence given by another
party.  Under such
circumstances, the trier of facts can certainly give regard to the
only evidence presented by one party
with some degree of assurance
than might otherwise have been the case, if there was evidence to
gainsay the version.
[51]
In the context of this case, it is significant to note the sentiments
as expressed
in the case of
Malherbe
v Britstown Municipality
1949 (1) SA 281(C)
,
on
page
287
when
the Court opined as follows:
“
Under
the procedure now prescribed by Act 32 of 1944 any question of onus
which arises in connection with any challenge of the Court's

jurisdiction must, in my judgment,
be
determined on a consideration of the particular form in which that
challenge is raised on the pleadings in the particular case
(my own
underlining)
. It is
the province of the plaintiff to establish the jurisdiction of the
Court into which he, as
dominus
litis
, has brought
the defendant. In this sense the onus of establishing jurisdiction
is, in my view, always on the plaintiff.
But
the form of defendant's plea
may
be such as to burden him with an onus to prove certain facts (my own
underlining)
. As
shown by VAN DEN HEEVER, J.P. (as he then was) in
Lubbe
v Bosman
, there is
weighty Roman-Dutch authority for the proposition that once a
defendant raises the
exceptio
fori declinatoria
as
a substantive plea 'the onus rests upon him of proving the facts upon
which his plea to the jurisdiction is based'. In such a
case the
defendant in his plea avers the existence of certain facts which, if
proved, will defeat the jurisdiction.
The
onus of proof of such facts rests upon the defendant (my own
underlining).”
[52]
In the matter of Munsamy v Govender 1950 (2) SA 622 (N) at 624,
Broome J, echoed the sentiments expressed
in
Britstown
Municipality supra
, when he opined as follows:
“
Mr.
Hathorn’s submission is far-reaching and uncompromising.
It is that the plaintiff, who as dominus litis choses the
forum,
carries on his shoulders at all times the burden of showing that the
Court in which he has elected to sue has jurisdiction
to try the
case. The question, it is true, may never be raise, in which case his
burden will not trouble him. But once the question
is raised, in
whatever form it is raised, he must discharge his onus or give up the
fight.  I cannot accept that argument…
in the present
case the defendant has alleged a fact . . . The onus is clearly upon
him to establish this fact. . . in the circumstances
of the present
case, the onus was on the defendant to establish the fact which he
alleged , proof of which would determine the
question of
jurisdiction.  As he failed to discharge this burden, the
question . . .   must be decided in plaintiff’s

favour”.  See also
Botha
v Andrade
(578/2007) [2008]
ZASCA 120 (26 September 2008)
at
paragraph 18.
[53]
The Plaintiff’s case in this regard is that the Competition
Commission has already found in its
favour.  In the instant
case, notwithstanding the evidence tendered on behalf of the
Plaintiff regarding the jurisdiction
issue, the Defendant chose not
to gainsay or to respond to what was stated on behalf of the
Plaintiff.    In this
matter, there is no evidence to
show that there is a pending complaint currently before the
Competition Tribunal or Commission.
[54]
It was thus significant during the trial for the Defendant to produce
facts that would counter the
evidence of the Plaintiff and that would
give an indication that the Regional Court’s jurisdiction was
ousted.
[55]
It is clear therefore in this case that, no evidence was tendered in
the trial court, to attest that
pursuant to the non-referral finding
of the Competition Commission; the complaint is currently pending
before the Competition Tribunal,
or there is a new complaint lodged
for investigation with the Competition Commission.
[56]
With the risk of repeating myself, and as described extensively
above, the facts which were presented
before the Regional Magistrate
plainly demonstrate that the Competition Commission issued a notice
after a complaint was lodged
with it against the Plaintiff, to the
effect that if the complainant wishes to refer the complaint to the
Tribunal that should
be done within 20 business days.  In these
circumstances, it follows that there are good grounds for believing
that there
was no referral of the complaint to the Competition
Tribunal, after the 28 March 2013.
[57]
Consequently, in the context of this case, it is incomprehensible
that the counsel on behalf of the
Defendant contends that the
findings of the Competition Commission are not binding.   There
is no scintilla of evidence
in support of the contention.
[58]
As such, by virtue of the letter written by the Competition
Commission on the 28 March 2013, it does
not follow that the
Defendant can infinitely rely on the same issue.  Hence, under
the circumstances of this matter, the assertion
that the
Plaintiff practices a prohibited conduct as envisaged in the
Competition Act;   is
not sufficient to oust the Regional
Court jurisdiction.
[59]
In his heads of argument, counsel for the Plaintiff
correctly states that there are
no basis for the Defendant now to
seek to air a complaint that has been determined, effectively against
him, without the issue
having been taken any further at the
appropriate time.
[60]
Because the surrounding facts involved in
establishing the jurisdiction of the Competition Tribunal were
critical in the determination
of the jurisdictional aspect; it was
not sufficient for the Defendant to simply close his case without
leading evidence.
Accordingly, in the context of this case,
after the evidence of the Plaintiff was heard regarding
jurisdictional fact; it was incumbent
upon the Defendant to tender
facts, which would show that the Regional Court has no
jurisdiction.   It is critical to
emphasise that it is
evident that this particular issue was  primarily decided on the
evidence presented by the Plaintiff.
The Regional Magistrate in
dismissing the challenge cannot be faulted on that point.
Locus Standi
[61]
It is argued that the Plaintiff does not have has
locus standi in
iudcio
to make the claims against the Defendant. The high
watermark of this submission is because the following is asserted
against the
Plaintiff:
(a)  did not conduct
any business;
(b)  was at all
material times, a mere ‘shell’; and
(c)   did not
and could not have, incurred any fixed costs.
(d)   When the
‘verwerkingsooreenkoms’ was concluded, it was the
intention of the Plaintiff and Lutzville
Ltd to divest the Plaintiff
of all rights and duties vis-à-vis the members of the
Plaintiff and to vest them in Lutzville
Ltd.  The Plaintiff
ceded all its rights and interests to Lutzville Ltd.
(e)  The Plaintiff
as a single Plaintiff, has nothing to claim.
(f)    The
Plaintiff is not suing in the capacity of cessionary.
(g)  Lutziville Ltd
has not been joined as co-plaintiff.
(h)  cession.
[62]
It is relevant to quote some of the relevant parts (Clauses 3.1; 3.2;
3.3; 5; 6; 7 and 8) of the ‘Verwerkingsooreenkoms’.
The
clauses read as follows:
“
3.1 Die
Koöperasie stel hiermee vir die Maatskappy aan on namens
die  Koöperasie diens te lewer aan verskaffers,
en sedeer
verder sy volle reg in en tot lewering van produksie deaur
verskaffers aan die Maatskappy aanvaar hiermee die stelling
en sessie
op die terme en voorwaardes hierin uiteengesit.  Sonder om die
algemeenheid van voorgenoemded te beperk, sluit voormelded
sessie die
reg in om produkte van verskaffers te verpoel soos hieronder
uiteengesit.
3.2 Die  Koöperasie
onderneem om mee te werk om alle nodige ondersteuning aan die
Maatskappy te gee om die Maatskappy
in staat te stel om die
leweringsreg uit te oefen ten opsigte van al die produkte van die
verskaffers, so volmaak en doeltreffend
asof die Maatskapyal die
magte, bevoeghede en verpligtinge het van die  Koöperasie
in gevolge die statute.
3.3 Indien 'n verskaffer
in gebreke is van die leweringsreg van Koöperasie hierkragtens
sedeer aan die Mmaatskapy na te kom,
dan in so 'n geval onderneem die
Koöperasie en sal dit verplig wees indien die Maatskapy aldus
versoek, om al die nodige stappe
te doen kragtens die statute
toelaatbaar om verskaffer te verplig om die produkte aan die
maatskappy te lewer.
5. REGTE EN VERPLIGTINGE
VAN DIE MAATKAPPY
Die Maatskappy sal,
sonder om afbreuk te doe naan diens in die breë strekking
daarvan, vir die volgende verantwoordelik wees:-
5.1 . . .
5.2 . . .
5.3 . . .
5.4 Die Maatskappy sal
verplig wees om, indien daartoe versoek deur die Koöperasie, ten
volle alle rekords openbaar te maak
aan die Raad van die
Koöperasieten opsigte van die verkoopspryse behaal deur die
Maatskappy met die verkoop van wyn uit die
produkte.
5.4 . . .
6. VERPLIGTE VAN DIE
KOöPERASIE
Die Koöperasie sal
verplig wees om:-
6.1 te verseker dat die
verskaffers volhou om hul produkte betyds en direk aan die Maatskappy
lewer om die Maatskappy in staat te
stel om sy verpligtingeefektie na
te kom;
6.2 jaarliks, op die
effektiewe datum of enige verjaring daarvan, vir die Maatskappy in
kennis te stel van die beraamde volume per
produk variteit wat die
Maatskappy verplig is om te verwerk;
6.3 . . .
6.4 jaarliks wanneer deur
die Maatskappy daartoe versoek, ʼn  wingerdsstoksensusonder
sy ledeto hou en die resultate daarvan
tot beskikking van die
Maatskkapy te stel;
6.5 te bewerkstelling dat
verteenwoordigers van die Maatskappy van tyd to ty den te alle
redelike tye die re gen bevoegheid het
om:-
6.5.1 die wingerdboorde,
die dryf van die wingerdstok  en nuwe aanplantings te
inspekteur;
6.5.2 te adviseur ten
opsigte van korrekte en behoorlike boerdery-praktyke en gehalte
beheer;
6.5.3die verskaffers te
adviseer en in te lig ten opsigte van cultivar en kwaliteit vereis;
en
6.5.4 indien die
Maatskkapy die nodig vind, ʼn wingerdstoksensus te hou.
7. VERPOELING EN
VERGOEDING
7.1 Die Maatskkapy
onderneem hiermee ten gunste van die Koöperasie en die
verskaffers om as agent van die verskaffers:-
7.1.1 Die produkte te
verpoel;
7.1.2 Betaling te maak
aan die verskaffers ten opsigte van die produkte Aldus verpoel, . . .
7.2 . . .
8. RISIKO
Die Koöperasie sal
toesien dat die risiko ten opsigte van die produkte deur die
verskaffers direk aan die Maatskappy gelewer
in gevolge van hierdie
ooreenkoms steeds in die betrokke verskaffer vestige en vrywaar
hiermee die Maatskaapy teen enige eise deur
verskaffers ten opsigte
van verlies te wyte aan opste growwe nalatigheid aan die kant van die
Maatskappy.”
Was the Plaintiff at
all material times, a mere ‘shell’?
[63]
Mostert testified that the Plaintiff is an agricultural Co-Operative,
with members.   The
Plaintiff’s witnesses never
testified that the Plaintiff was a mere shell.  It is settled
law that a registered Co-operative
is a legal entity.   The
Defendant admitted this in his response to Plaintiff’s request
for trial particulars,
asserting that the Plaintiff is currently
incorporated.
[64]
Mostert further testified that on 17 December 1999, the Co-Operative
[Plaintiff] was registered with
the intention of conducting the
business of wine cellars on behalf of its members.  According to
Mostert, the members of the
Plaintiff share in the liability of the
fixed costs of the Plaintiff.  He also testified that the
Plaintiff still exists with
the two constitutions and has not
disappeared from the scene.
[65]
On the other hand it was the testimony of  the auditor of the
Plaintiff, Mr Voss (Voss) that;
because the Plaintiff had a
constitution and the ‘verwerkingsooreenkoms’ agreement in
place, it cannot be said that
the Plaintiff was a shelf
co-operative.  Furthermore, it was Voss’s testimony that
the Plaintiff cannot be a shelf co-operative,
as it had meetings,
annual directors’ meetings, annual general meetings and had an
agreement with Lutzville Vineyards Ltd.
He testified that a
shelf company does not have such agreements and does not hold
directors meetings. According to Voss, a company
in a shelf merely
lays on the racks and nothing goes on.
[66]
Additionally, if one has regard to Clause 8 of the
‘verwerkingsooreenkoms’ under the heading
‘RISKO’;
it becomes evident that notwithstanding the cession contained in
clause 3 of the ‘verwerkingsooreenkoms’,
that the
Plaintiff still remained as an active co-operative. As set out above
in clause 8 of the ‘verwerkingsooreenkoms,’
the Plaintiff
categorically makes an undertaking to do certain things and even
indemnifies Lutzville Vinyards Ltd, against any
claims from the
suppliers with regards to loss of produce whilst in possession of
Lutzville Vinyards Ltd, excluding loss due to
gross negligence on the
part of Lutzville Vinyards Ltd.
[67]
The question, which immediately begs is, if the Plaintiff is a ‘shell
co-operative’, how
is it possible for it to have active
members, conclude agreements, make undertakings to indemnify
Lutzville Vineyard Ltd against
law suits.  Equally, clause 9 of
the verwerkingsooreenkoms,’ under the heading ‘OORMAG EN
OES MISLUKKING’
reads as follows:
“
9.1.3.2. Indien
die Maatskappy die party in versuim is, sal die Koöperasie
geregtig wees om alternatiewe reëlings te tref
met ʼn derde
party vir daardie bepaalde parsseisoen om die produktevan die
verskaffers te ontvang vir daardie parsseisoen,
tot die mate dat die
Maatskappy nie sy verpligtinge kragten die ooreenkoms kan na kom
nie.”
[68]
If Clauses 8 and 9 of the ‘verwerkingsooreenkoms’ prove
anything, it is that the Plaintiff at
the critical time was active.
[69]
There is a close correlation between clause 8 and 9, of the
‘verwerkingsooreenkoms,’ and the
testimony of the
Plaintiff’s witnesses; that the Plaintiff still exists, is
active and has members.  The two provisions
cited of
the‘verwerkingsooreenkoms’ supports the testimony that
the Plaintiff was not a shell.   By contrast,
Defendant
tendered no evidence to contradict Plaintiff's evidence.
[70]
Clause 3.2 of the Plaintiff’s constitution of 2004 and 2012
state the following:
“
Die Koöperasie
is opgerig om saam met die maatskappy [Lutzville Vineyards Ltd]
te dien as kollektiewe bedryfsvoertuie
vir die lede van Koöperasie.”
[71]
On the other hand, the terms and conditions of the
Leweringsooreenkoms state the following:
“
VOORWAARDES VAN
OOREENKOMS
AANGESIEN die koöperasie
en die maatskappy as kolletiewe bedryfsvoertuie op gronde van sy
verbintenis met die maatskappy oor
die infrastruktuur beskik om
druiwe te verwerk tot wyn en verwante produkte end it te bemark:
EN AANGESIENdie lid oor
aandele en parskwota in die koöperasie beskik en die lid
kragtens die statuut van die koöperasie
'n  leweringsreg
het om, onderhewig  aan die bepalings van die koöperasiese
statuut, druiwe wat op die ingeskrewe
plaas verbou word by die
koöperasie te lewer vir die verwerking tot wyn en verwante
produkte en die bemarking daarvan; . .
. “
EN AANGESIEN die
koöperasie bereid is om sodanige ooreenkoms met die lid aan te
gaan:”
[72]
The ‘leweringsooreenkoms’ entered between the Defendant
and Plaintiff after the conclusion
of the
‘verwerkingsooreenkoms, clearly illustrates that the Plaintiff
was very active. The Plaintiff even concluded
another agreements
after the cession.
[73]
Although it is argued that the Plaintiff is a shell, there is no
version to adequately provide substance
to this argument.
In the absence of any evidence to gainsay the Plaintiff’s
version, there is nothing
to contradict the evidence that the
Plaintiff was active.
Did Plaintiff conduct
any business?
[74]
It is contended on behalf of the Defendant that the Plaintiff did not
and could not have incurred any
fixed costs.
The evidence in this
matter, particularly the evidence of Voss, reveals that the
directors of the Plaintiff perform the duties
of compiling
financial statements annually for the Plaintiff and putting in place
the ‘verswerkingsooreenkoms’ and
the
‘leweringsooreenkoms’.
[75]
Voss testified that there was no operational activity as a winery in
the Plaintiff, but also elaborated
that it cannot be said that there
was no business conducted by the Plaintiff.   According to
Voss, it is typical in co-operatives
and companies with co-operative
to have a pooling system, where all monies go into one banking
account.
[76]
Voss further testified that he is a chartered accountant, and for the
period of 2011 to 2014, he was
personally involved in the auditing of
the Plaintiff.  For each year, there was a financial statement
for the Plaintiff and
he was present in the general meetings and he
presented financial statements.  There is nothing sinister about
the fact that
the Plaintiff did not have income statements and cash
flow statement.  He further testified that generally a financial
statement
contains a balance sheet and an income statement.
Where there is no income statement, it has to be indicated in the
financial
statements that there is no income or expenses for the
year.
[77]
Clearly, there is no other version to dispute the claim of the
Plaintiff’s expert witnesses.
There was no evidence
produced to contradict or rebut Voss’s testimony.
[78]
I simply cannot fathom why it is contended in the heads of argument
of the Defendant that it is apparent,
beyond doubt from the evidence
both oral and documentary that the Plaintiff did not conduct any
business. Once again, this assertion
is not supported by evidence.
The cession
[79]
The issue here is whether the Plaintiff as a cessionary ceded all the
rights and interests to Lutzville
Ltd.  According to Voss the
Plaintiff only ceded ‘lewerings reg’ in terms of the
‘verwerkingsooreenkoms’
agreement and the Plaintiff
through the ‘verwerkingooreenkoms’ asked Lutzville
Vineyards Ltd to do the functions mentioned
there, for instance
recovery of fixed costs.  He does not agree that Lutzville
Vineyards Ltd took over the duties of the Plaintiff.
He is not
aware of any document that states that Lutzville Vineyards Ltd, will
take over the duties of the directors of the Plaintiff
regarding the
constitution.
[80]
Voss, testified that the Plaintiff has an obligation to take in
produce and make wine.  However,
the Plaintiff does not have
assets.  Because the Plaintiff does not have a winery, it
concluded a ‘verwerkingsooreenkoms’
with Lutzville
Vineyards Ltd.   Lutzville Vineyards Ltd did the function
through ‘verwerkingsooreenkoms’.
Lutzville
Vineyards Ltd then gets paid through commissions, for its incurred
expenses and winery.  According to Voss, in terms
of the
‘verwerkingsooreenkoms’, Lutzville Vineyards Ltd has no
ownership right in respect of the wine manufactured.
[81]
The cession is created in the ‘verwerkingsooreenkoms’. It
is however, significant that nowhere in
the
‘verwerkingsooreenkoms’ is there mention made of the
Plaintiff ceding his right of action to the Lutziville.
[82]
The most relevant part of this issue is under the heading
‘Aanstelling en sessie’ in the
‘verwerkingsooreenkoms’.
Clause 3.1, categorically states that the purpose of the cession is
to do with
delivery of products by suppliers and the right to pool
the products of the suppliers.  Gleaning from the terms of the
‘verwerkingsooreenkoms’,
under the cession heading, it is
quite clear that the ownership in the rights pertaining to delivery
of product by suppliers remains
vested with the Plaintiff despite the
cession.  Therefore, the right of action by the Plaintiff was
not transferred with the
cession.
[83]
Clause 3.3 of the ‘verwerkingsooreenkoms’ clearly
illustrates the point when it states
that the Plaintiff undertakes to
work together and give the necessary support to Lutzville Ltd, so
that Lutzville Ltd can
be in a position to perform the delivery
right perfectly and effectively; as if Lutzville has all the powers,
authority and responsibilities
the Plaintiff has in terms of the
statute.  This quite clearly indicates that no powers,
authorities and responsibilities
were ceded to Lutzville Vineyards
Ltd.
[84]
Importantly,  clause 3.3 of the ‘verwerkingsooreenkoms'
states pertinently that, if the
supplier breaches the delivery right
which is ceded to by the Plaintiff to Lutzville Vineyards Ltd; the
Plaintiff under such circumstances
undertakes and will be obliged if
Lutzville so requests,
to take all the necessary  permissible
steps under the statute, to compel the supplier to deliver the
products to Lutzville
.
[85]
Clause 3.3 of the ‘verwerkingsooreenkoms’ plainly
differentiates between the ceded right
and the right of enforcement.
Noticeably clause 3.3 explicitly stipulates that when there is breach
from the supplier, the
Plaintiff derives the right to enforce
directly from the statute.
[86]
Along with that, or perhaps, more importantly is that clause 8 of the
‘leweringsooreenkoms’,
which interestingly was entered
into between the Defendant and the Plaintiff, after the
‘verwerkingsooreenkoms’ became
effective; states the
following:
“
8. KONTRAKBREUK:
Indien die lid sou
versuim om sy verpligtinge teenoor die koöperasie ingevolge
hierdie ooreenkoms na te kom, sal die koöperasie
geregtig wees
om:
8.1
Onmiddelike spesifieke nakoming van hierdie ooreenkoms van die lid te
eis en onmiddelik regstappe
teen die lid te stel . . .
8.2 . . .
8.3 . . .”
[87]
Manifestly, in terms of clauses 3.3 of the ‘verwerkingsooreenkoms’
and 8 of the leweringsooreenkoms,
the Plaintiff has exclusive right
of action.  If these clauses do not categorically evince that
the Plaintiff retains the
right to enforce the terms of the
constitution of the Co-operation, despite the cession of the delivery
rights; nothing will.
[88]
Equally, if the conclusion of the  ‘verwerkingsooreenkoms'
was intended to  strip the
Plaintiff’s of  all its
rights and duties as far as the members are concerned, and vest them
to Lutzville Vineyards
Ltd;  then it does not make sense that
clause 9.1.3.2 of the ‘verwerkingsooreenkoms' would still
allow the very
same Plaintiff  to make alternative arrangements
with third parties to receive products from the suppliers for the
specific
press season;  if Lutzville Vineyards Ltd is in
default.
[89]
Likewise, if regard is had to clause 6 of the ‘verwerkingsooreenkoms'
under the heading ‘VERPLIGTINGE
VAN DIE KOöPERASIE’,
it is evident that the Plaintiff still retained obligations towards
its members.  For instance,
clause 6.1 states the following:
“
Die Koöperasie
sal verplig wees om:-
6.1
te verseker dat die verskaffers volhou om hul produkte betyds en
direk aan die Maatskappy lewer
om die Maatskappy in staat  te
stel om sy verpligte effektief na te kom;”
6.2
jaarliks , op die effektiewe datum of enige verjaring daarvan, vir
die Maatskkapy in kennis te
stel van die beraamde volume per produk
variteit wat die Maatskappy verplig is om te verwerk;
6.3
Indien die Maatskappy aldus versoek, om te bewerkstelling dat nie
later as 15 Desember  van
elke jaar, die verskaffers
'
n
skriftelike staat indien by die gereggistreerde kantoor van die
Maatskappy van die hoeveelheid en elke sort druif, vir die maak
van
wyn bestem, wat hy verwag om in die eersvolgende oes te produseer
waarop die lewringsreg betrekking het. Nieteenstaande die

voorafgaande sal die Maatskappy ook geregtig maar nie verplig wees om
sodanige oesskatting van die produkte self te doen sonder
die tussen
koms van die Koöperasie
;
6.4
jaarliks wanneer deur die Maatskappy daartoe versoek, 'n
wingerdstoksensus onder sy lede te hou
en die resultate daarvan to
beskikking van die Maatskappy te stel;
6.5
. . .
[90]
Similarly, in clause 5 under the heading ‘REGTE EN VERPLIGTINGE
VAN DIE MAATSKAPPY’, the
following is stated in clause 5.4:
“
5.4
Die Maatskappy sal verplig wees om, indien daartoe versoek deur die
Koöperasie, ten volle alle rekords openbaar te
maak aan die Raad
van die
Koöperasie ten opsigte
van die verkoopspryse behaal deur die Maatskappy met die verkoop van
wyn uit die produkte.”
[91]
Remarkably, merely from the provisions of clause 5.4, Lutzville
Vineyards Ltd is financially accountable
to the Plaintiff.  In
my mind it is palpable that Lutzville Vineyards Ltd was dealing with
the monies in terms of the ‘verwerkingsooreenkoms’
on
behalf of the Plaintiff.  Hence Lutzville Vineyards Ltd is
obligated to account.
[92]
From the aforegoing, it is thus incorrect to contend that when the
‘verwerkingsooreenkoms’
was concluded, it was the
intention of the Plaintiff and Lutzville Ltd to divest the Plaintiff
of all rights and duties vis-à-vis
the members of the
Plaintiff and to vest them in Lutzville Vineyards Ltd.  The
‘leweringsooreenkoms’, eloquently
articulates this point.
[93]
In the context of this matter, it is correct to contend that the
conclusion of the agreement did not
lead to the Plaintiff losing its
identity or becoming a shell.  Instead, the Plaintiff created
its own operational agreements
to enforce its constitutions.  It
is also significant to note that the constitutions of the Plaintiff
are the primary statutes
that maintain the relationship between the
members and the Plaintiff.  The Plaintiff’s constitutions
are also the documents
that retain the Co-operative in existence.
This action owes its genesis to the Plaintiff’s
constitutions and not the
‘verwerkingsooreenkoms’.
[94]
Under the circumstances of this matter it was not necessary to join
Lutzville Vineyards Ltd as a party to
the proceedings. It is well
established that the term “direct and substantive interest’
means an interest in the right
which is the subject matter of the
litigation and not merely an indirect financial interest in the
litigation.   See,
Verbatim Ex parte
Body Corporate of Caroline Court
2001(4)
SA 1230 SCA on page 1239 A.
[95]
There is no basis to assert that the Plaintiff’s claim is for
monies which (if any were due and
owing) accrued, or were owed to
another legal entity, the Company, or at best for Plaintiff, the
‘group’.
Surely, if the monies belonged to a
group it was not necessary to set up accountability mechanism, which
would oblige Lutziville
Vineyards Ltd to lay all records to the
‘Raad’ of the Plaintiff.
[96]
Mostert testified that the ‘verswerkingsooreenkoms’ was
put into place to make sure that
the grapes delivered by members or
producers would be pressed and the commercial part would be done
through Lutzville Vineyards
Ltd on behalf of the Plaintiff.
It was his testimony that the Company acted on behalf of the
Plaintiff regarding the
pressing and marketing of the product.
Invoices were issued in the name of the Plaintiff.  When the
‘verswerkingooreenkoms’
came into effect it did not
affect the obligations of the members of the Plaintiff.
He testified that the ‘verswerkingooreenkoms’,
is an
agreement between Lutzville Vineyards Ltd and the Plaintiff to do
functions which the Plaintiff should have done.
[97]
Vos testified that he would understand if Mr Mostert testified that
it was a group that conducted business,
if he said that in layman’s
terms.  But it was not a group in terms of the Companies Act
perspective.   There
is no evidence to contradict this.
[98]
The above takes care of the non-joinder plea.   Therefore,
it is not necessary to deal with
the non-joinder issue separately.
The provisions of the
Co-operative Act
[99]
It should, however, be borne in mind that, it was the testimony of
Mostert that they decided to make
a change in their business. In
1999, they then put the new Co-Operative next to the Company to
control the membership of farmers.
The payment obligation of
the members stems from clause 101 of the Constitution. In terms of
clause 101 of 2011 constitution, the
board determines the commission
on annual basis that is payable by members of the Plaintiff. It is
also averred in the particulars
of claim that the Plaintiff was duly
incorporated in terms of the Co-Operative Act.
[100]   This
Court has already found that the evidence in this matter does reveal
that the Plaintiff  conducted business.
In any event, this
Court cannot see how non- compliance with the Co-operative Act is
linked to the claim of the Plaintiff. This
Court tends to align
itself with the sentiments as expressed in the heads of argument on
behalf of the Plaintiff that the Co-Operative
Act provides for its
own remedies for violation or noncompliance with the Co-Operative
Act.
[101]   Surely,
it would be illogical to expect that a party that has issued
summonses should in addition to proving the
cause of action, also
prove general compliance with a statute that created it,
particularly, if they are not related to the cause
of action.
There is no prerequisite in the Co-Operative Act that states that;
before a party  can be able to claim what
it believes it is
owed, it should prove general compliance with the  provisions
Co-Operative Act.  It is unfathomable
in the context of this
case that non-compliance with the statute can be raised as a defence
to the claim of the Plaintiff.  The
cause of action in this
matter is not the Co-Operative Act.
It is my firm view that in the context of this case, t
he
non-compliance, or compliance with the Co-Operative is irrelevant to
the inquiry of failure to comply with the constitution of
the
Co-Operative.  I do not accept that argument of the Defendant
when it comes to this aspect.
[102]   No
evidence was put forward to defeat the evidence of the Plaintiff,
that it is entitled to the prayers it sought.
Cost orders issue
[103]   It is
well settled, that, a court of appeal does not normally interfere
with a cost order of the court of first
instance.  Costs is a
matter for the exercise of the trial court discretion.  A court
of appeal can only interfere with
the discretion of the lower court
if it has not exercised its discretion judicially or has misdirected
itself.
[104]   The
costs orders granted by the Regional Court Magistrate are not typical
costs orders. I am acutely alive to
the fact that in terms of rule 33
(1) of the Magistrates’ Court Act, 32 of 1944, (the
Magistrates’ Court Act) the magistrate
can award such costs as
he /she deems fit.    In the Magistrate’s Court,
there is a rising scale A, B, C and
D, which sets out the scale upon
which the costs are to be computed.  The rising scale is
premised on the amount in dispute
or the nature of the cause of
action.
[105]   It is
not entirely correct to state that there is no Regional Court scale.
Particularly if regard is had
to the provisions of Annexure 2 of the
Magistrate’ Courts Rules.  Part 1 to Annexure 2 reads as
follows:
“
. . . [W]hen the
amount in dispute exceeds the maximum jurisdictional amount so
determined but the Minister in respect of magistrates’
courts
for districts and
the process issued out of a
magistrate’s court for a regional division or when the matter
is in respect of a cause of action
in terms of section 29 (1B)(A) of
the Act, costs shall be taxed on scale D.
”
(My emphasis) Thus, scale D is a regional court scale.
All the amounts claimed by the Plaintiff in this
matter, fall under
scale D.
[106]
However, in the instant case, the trial court’s failure to
furnish reasons to elucidate the basis upon which
she awarded the two
cost orders, is problematic.  Moreover, it is not clear why the
second cost order was made to be paid
on a higher scale and which
higher scale she is referring to as the Plaintiff did not make
mention of any ‘higher scale’
in its amended particulars
of claim.    Furthermore, considering the issues
raised by the Defendant, this matter
was not a simple matter; as
such, services of a counsel was warranted.
[107]   Under
the circumstances, it is difficult to determine whether the Regional
Court Magistrate exercised her discretion
judicially, when she
phrased the cost orders in the fashion which she did.   The
issues raised by the Defendant pertaining
to the costs were not going
to create insurmountable hurdles for the taxing master. Moreso, if
regard is had to the fact that there
is no such thing as a cost for
senior counsel, and that it was not really necessary for the Regional
Court Magistrate to itemise
the costs to be billed.
[108]   In
order to avoid confusion in future for the parties. I am going to
substitute the cost orders issued by the
Regional court magistrate as
follows:
Costs pertaining to
absolution application
“
1.
Defendant is ordered to pay the costs of the application for
absolution from the instance,
on a party and party scale;
2.
The costs include the costs of counsel.”
[109]
Costs pertaining to the action
“
The Defendant
shall pay Plaintiff’s costs of suit on party and party scale
including services of a counsel and fees for the
expert witness.”
In
the results, the following order is made:
1.
The Regional Court Magistrate cost order dated 31 March 2021, is
hereby set aside and substituted as
follows:
1.1
Defendant is ordered to pay the costs of the application for
absolution from the instance, on a party and party scale;
1.2
Such costs to include cost of counsel.
2.
The Regional Court Magistrate costs order dated 20 August 2021, is
hereby set aside and substituted as follows:
2.1
The Defendant shall pay Plaintiff’s costs of suit on
party and party scale including services of a counsel and fees for
the
expert witness.
3.
The appeal is dismissed with costs
CN NZIWENI
Acting Judge of the
High Court
I agree and it is so
ordered
MI SAMELA
Judge of the High
Court