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[2016] ZAGPJHC 167
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Property Master (Pty) Ltd v Redefine Properties Ltd (42983/2015) [2016] ZAGPJHC 167 (24 June 2016)
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REPUBLIC
OF SOUTH AFRICA
IN THE
HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO:
42983/2015
DATE:
24 JUNE 2016
In
the matter between:
Property
Master (Pty)
Ltd
.......................................................................................................
Applicant
And
Redefine
Properties
Ltd
........................................................................................................
Respondent
Judgment
Van der Linde, J:
Introduction
[1]
The applicant applies under s.50(1)(a) of
the Promotion of Access to Information Act 2 of 2000 (“PAIA”)
for an order
against a “
private
body”
as defined to provide it
with two written sale of land agreements.
[1]
The respondent resists the disclosure on four bases,
[2]
amongst other things because the applicant has not shown a “
right”
as required by s.50 (1)(a) of PAIA.
[2]
The essence of the parties’ dispute
on this score is that the applicant contends that the words “
any
rights”
are so wide that they
even include the right to investigate whether the applicant has a
cause of action available to it to claim
relief in an appropriate
forum from the respondent.
[3]
The respondent contends that such an interpretation is a bridge too
far, and that the applicant needs to define with some exactitude
the
right that it will want to enforce.
[4]
But in any event, according to the respondent the applicant has such
material as it needs to enforce such right as it has.
[5]
[3]
These two opposing contentions illustrate
where the rub lies in this application. The applicant’s
contention, if unqualified,
implies virtually no threshold to access
entitlement. A person need then only allege that s/he wishes to
investigate whether s/he
has any rights against anyone, and access
would be compellable.
[4]
The
respondent’s contention in turn, if unqualified, implies that
if a person is able to define, with some exactitude, the
right s/he
wishes to enforce, the availing of information is unnecessary for the
exercise or protection of that right. These issues
are considered
below after referring to the facts.
The facts
[5]
The
applicant owned a stand, Erf 3, in K W’s T, some 6 m2 in
extent. On 21 October 2004 it sold the stand to a trust called
Thycel
Trust in terms of a written agreement which contained the following
provision (emphasis supplied):
“
The
parties confirm that here is an existing application for the
subdivision of Erf 3, K W’s T. The parties agree that it
is
their intention that the purchaser acquires the portion marked ‘A’
on the attached draft sub divisional diagram.
Although this agreement
is for the sale of the whole of Erf 3, K W’s T, once the
application for the subdivision is approved,
the
parties agree herewith that the portion of Erf 3 marked ‘B’
on the attached draft sub divisional diagram,
will
then be transferred into the name of the Seller without any
consideration
payable by the
Seller to the Purchaser. The parties further agree that the costs of
such transfer, will be borne by the Seller.”
[6]
According to the applicant,
[6]
when this agreement was concluded, and since then to this day, the
applicant was and has been occupying the portion defined as
“B”.
[7]
Portion “B” is larger than portion “A”, the
former measuring 3982 m2 and the latter measuring 2316 m2.
[8]
The purchase consideration of R1.8m took account of the subdivision
and the retransfer of portion “B” to the applicant.
[7]
The
transfer took place but before any subdivision occurred, slightly
more than four months later, Thycel on-sold the property to
ApexHi on
8 March 2005. Their written agreement contained a clause in these
terms (emphasis supplied):
“
11.1
The parties record and agree that their intention is:
11.1.1 for
the purchaser to acquire the property and to take transfer thereof on
the transfer date; and
11.1.2 for
the purchaser, after having taken transfer and after the
sub-division, to
transfer the specified portion back to the
seller
.
……
..
11.3 The
purchaser agrees:
11.3.1
…
11.3.2
that once the sub-division is complete,
to
transfer the specified portion back to the seller at nil
consideration, it being agreed that the purchase price payable by the
purchaser for the property already takes into account the
sub-division
.”
[8]
The sub-clauses in between those quoted
above, oblige Thycel to do all things necessary to achieve the
sub-division. ApexHi in turn
agrees to sign all documents on request
to achieve this result. The “
specified
portion”
underscored above is
identified in the agreement as portion B in the annexed diagram; and
the same diagram as was annexed to the
first sale from the applicant
to Thycel, was again annexed to this agreement.
[9]
The applicant says of these provisions that their purpose was to
protect the interest that the applicant had in the property as
reflected in its agreement with Thycel.
[10]
[9]
Subsequently, at some stage during 2010,
ApexHi was either taken over by or merged with Redefine Properties
Ltd, the respondent,
a listed company. Although the applicant said
that it did not know details of this, nor clearly whether it was a
take-over by the
respondent or a merger, the respondent did not
clarify any of this uncertainty. It simply agreed that the details
are not relevant.
[11]
[10]The
applicant has obtained a copy of the deed of transfer whereby ApexHi
transferred Erf 3046 to the respondent on 11 November
2010 for
R13.3m.
[12]
The size of the property transferred suggests that no sub-division
had taken place.
[13]
[11]Since the applicant knows no
detail of the take-over or merger between ApexHi and the respondent,
it also does not have the
written agreement whereby ApexHi sold the
property to the respondent. It obviously therefore cannot tell what
the respondent knew
of the written agreement between ApexHi and
Thycel, in particular the clause in the agreement that the purchase
price for the acquisition
of the property took account of the
sub-division whereby portion “B”, occupied by the
applicant, would be transferred
back to Thycel.
[12]This agreement is being
sought in terms of prayer (a)(i) of the notice of motion.
[13]Within the same timeframe the
respondent on-sold the property to Arrowhead Properties (Pty) Ltd on
8 September 2011. It was
transferred by the respondent to Arrowhead
on 28 November 2011. This agreement too is not available to the
applicant, and so it
cannot tell whether anything was said between
those contracting parties about portion B, then still occupied by the
applicant.
This agreement is now being sought in terms of prayer
(a)(ii) of the notice of motion.
[14]Thereafter,
on 20 November 2013, Arrowhead sold the property to Mathipane Tsebane
CC for R2.545m.
[14]
In clause 8.2 it is recorded that the shaded portion “A”
was being occupied by a third party, a reference to the applicant,
“
without the payment of
compensation or otherwise by such third party.”
[15]
In
the attached diagram the applicant is referred to as “the
squatter.”
[16]
“
Any right”
[15]Against
this background the applicant submitted that notice of what it calls
its initial right to subdivision and retransfer
was not passed on
from one purchaser to another. It speculates that it was dropped
between ApexHi and the respondent, or between
the respondent and
Arrowhead. It submitted that the purpose of clause 11 of the second
sale, from Thycel to ApexHi, was to preserve
Thycel’s capacity
to give effect to its obligation to transfer portion “B”
to the applicant after subdivision
will have occurred.
[17]
The
point is that at this stage the applicant requires, it says, the
deeds of sale to determine whether it has a damages claim against
any
of the companies in this series of transactions and, if so, against
whom.
[18]
[16]
The applicant submitted that the “
broadest
possible interpretation”
should
be ascribed to the term “
any
rights”
, relying on M & G
Media Ltd and Another v 2010 FIFA World Cup Organising Committee
South Africa Ltd and Another.
[19]
It
argued too, relying on the Supreme Court of Appeal in Cape
Metropolitan Council v Metro Inspection Services (Western Cape)
CC
and Others,
[20]
that the concept is so wide as to include the right to investigate
whether any right exists at all.
[17]The
applicant stressed the dicta of Streicher, JA who recorded that the
party concerned had alleged in his founding affidavit
that the access
was reasonably required “
for the
exercise or protection of its rights and in particular to consider
whether it had a contractual or delictual claim for damages
against
the appellant or a claim for damages against SDR or any other
party.”
[21]
[18]These
words must be seen against the background of the how the founding
affidavit in that case actually read. The relevant portion
is not
reproduced in the judgment of the Supreme Court of Appeal, but in the
judgment of Cleaver, J in the court a quo (emphasis
supplied):
[22]
“
Metro
further relies on its constitutional right of access to information
as contained in s.32 of the Constitution. In this regard
the access
prayed for in the notice of motion is reasonably required for the
exercise or protection of Metro’s rights and
in
particular to consider whether Metro has a contractual or delictual
claim in damages against the respondent, or a claim for damages
against SDR Inspection Services or any other party, or to exercise
its constitutional rights to equality, or to protect its business
reputation and good name by obtaining an interdict or otherwise.
”
[19]The
respondent’s response to these submissions was that both cases
relied on by the applicant were still subject to the
test laid down
by the Supreme Court of Appeal in Clutchco (Pty) Ltd v Davis.
[23]
There Comrie, AJA was concerned with a shareholder of a private
company who sought to use the provisions of PAIA to get access
to the
books and records of the company. The court a quo granted the relief,
but is was reversed on appeal. The appeal court held
that the
information was not “
reasonably
required”
to protect or exercise
the right concerned, since the provisions of the Companies Act 61 of
1973 contained a refined structure
for providing information to
shareholders of a private company.
[20]That obviously does not apply
here; but what is important for present purposes is that the Clutchco
court followed Streicher,
JA (who was also on the Clutchco court) in
CMC, specifically at [28]. There the learned judge held that “
an
applicant has to state what the right is that he wishes to exercise
or protect, what the information is which is
required and
how that information would assist him in exercising or protecting
that right.”
[21]It must of course be
remembered the CMC court held that that threshold was met on the
facts of that case. And the facts of that
case, particularly the
relevant portion of the founding affidavit that bears out the
uncertainty that then still beset the applicant,
have been quoted
above.
[22]In the present matter the
applicant set out the factual background. That is followed by its
assertion that it had a right to
subdivision and retransfer. It
argues that notice of that right was not passed from one purchaser to
another. And it wants to investigate
whether it has a “
claim
in damages”
against any of the
companies in the series, following from the failure to have passed on
notice of the right to subdivision and
retransfer.
[23]Granted, it has not further
particularised its claim. But one knows from the factual background
that the purchase price of the
sale of Erf 3 excluded, at least in
respect of the first two sales, a price for portion “B”,
because that portion was
to go back to the applicant, who was
actually occupying it throughout. One knows too that there was
either a merger or a
take-over between ApexHi (a party to the second
sale and thus in the know) and the respondent. But that is where the
knowledge
trail ends.
[24]The applicant is thus unable
to particularise a potential claim for damages against say the
respondent, because it cannot tell
what the respondent knew.
Obviously neither ApexHi nor the respondent is the applicant’s
contracting party, and so a claim
in contractual damages is not
envisaged against either ApexHi or the respondent. The only claim for
damages that could be envisaged
against a defendant other than Thycel
is a delictual claim for damages.
[25]The applicant potentially
also has a claim for damages against ApexHi. From its contract with
Thycel one knows that the former
had knowledge at least of Thycel’s
interest and obligation to the applicant, and so also of the
applicant’s interest,
since the applicant was present on
portion “B” throughout. What the applicant does not know,
is how ApexHi treated
such knowledge in its on-sale of the property
to the respondent, as part of the take-over or merger.
[26]I return now to where the rub
lies in this application. If the applicant had enough information to
formulate its claim for damages
with more accuracy, it would not need
the information sought. It could then assess its prospects of success
and, if favourable,
institute an action. Further information, in the
nature of
facta probantia
,
could then be obtained either by discovery or, if the repository of
the information was not a party to the litigation, by
subpoena
duces tecum
.
[27]But if it has too little
information to formulate its cause of action with precision, and it
therefore cannot issue a summons,
but it can show that it has a
claim, at least potentially, then in my view the provisions of PAIA
avail. The applicant must show
a cognizable right, the potential
exercise or enforcement of which is involved on the particular facts
of the case, depending on
the information that is reasonably required
to be availed.
[28]Here the applicant has shown
that it started off in this series of transactions with an
entitlement to obtain retransfer of
portion “B”. That was
clearly a contractual right against Thycel. Thereafter Thycel
conveyed knowledge of the applicant’s
entitlement to ApexHi,
all the while with the applicant still on the premises.
[29]That knowledge could
conceivably expose ApexHi, if with knowledge of the applicant’s
interest, it acted in a manner intended
to deny the applicant the
ability to enforce that right, to a delictual claim for damages. And
if that is so, then the same reasoning
would apply in the case of the
respondent.
[30]Such
a claim could potentially fit the requirements for liability arising
from a third party’s intentional interference
in the
contractual rights of another; or it could fit the wrongful
infringement of a “
legally-recognised
right”
of another. In these
instances, where the recognition of a claim is often fact-driven,
[24]
the foundation of liability is Aquilian, not contractual.
[31]In these circumstances the
dicta of Morison, AJ in M & G Media, which is binding on me,
apply. It follows that in my view
the threshold requirement in
s.50(1)(a) of “
any rights”
has been met.
Is the
information sought “
required
”?
[32]S.50(1)(a)
provides that the information (or “
record”
)
must be “
required
for the exercise or protection of any rights”
.
Another of the respondent’s four challenges to the relief
sought was the contention that the applicant does not need any
further documents to ascertain whether it has a claim, since the
property was in fact never subdivided.
[25]
[33]The
Clutchco court considered
[26]
that the word “
required”
here “
does not mean necessity, let
alone dire necessity. I think that ‘reasonably required’
in the circumstances is about
as precise a formulation as can be
achieved, provided that it is understood to connote a substantial
advantage or an element of
need.”
[34]Once one accepts, as here one
must, that the applicant’s case as mounted in its founding
affidavit was not that it wished
further to investigate its rights
against Thycel, then the conception that the applicant is intent on
pursuing a contractual claim
may be set aside. Rather, as the
founding affidavit has pointed out, the claim for damages is
potentially against sellers who despite
knowledge failed to pass on
notice of the applicant’s interest to subsequent purchasers.
That can, in law, only be
a delictual claim, if the detailed facts
bear it out and policy considerations support it.
[35]On this basis it is difficult
to see why the information sought would not afford the applicant a
“
substantial advantage”
or would not signify “
an element
of need
.” The two contracts may
not completely satisfy the applicant’s need for information,
but that is a different issue.
Did the
applicant comply with the “
procedural requirements
”?
[36]S.50(1)(b)
provides that a requester must comply with the procedural
requirements of PAIA. The respondent contended that
the
applicant did not.
[27]
S.53(1) requires that “
a request
for access to a record of a private body must be made in the
prescribed form.”
S.53(2)
provides that the form so prescribed must at least require the
information set out in paragraphs (a) to (f).
[37]Regulations
under PAIA were published,
[28]
and
regulation 10 reads: “
A request
for access to a record as contemplated in section 53 (1) of the Act
must substantially correspond with Form C of Annexure
B.”
[38]Form C requires particulars
of the private body concerned; of the requester; of the record
sought; of any reasons for exemption
from fees; of the form of access
required; of the right sought to be exercised or protected; and of
the preferred form of notice
in response to the request.
[39]The
applicant’s request was not the prescribed form, but was
contained in three letters, dated 3 November 2014, 12 May
2015 and 25
August 2015 respectively.
[29]
The
aggregation of the contents of these letters covers the topics
identified in the prescribed form, barring the question of the
payment of fees. Of the right sought to be exercised or protected,
the following is said: “
Client was
the initial owner of Erf 3, K W’s T, and upon the sale thereof
certain rights were reserved in its favour.”
And, “
Client requires a copy of
both deeds of sale to determine how, in the sequence of later sales,
his rights were extinguished.”
[40]The applicant submitted that
the letters contain all of the content set out in and required by
s.53(2) of PAIA, and that those
letters “
substantially”
correspond with Form C.
[41]The
respondent contends however that it compiled a manual as required by
s.51(1) of PAIA, which manual is required by regulation
9 to be
published on the website of the private body concerned. The
respondent does not actually contend that the applicant was
required
to have complied with the manual, although the manual itself might be
read as suggesting that it is imperative that form
C be complied
with.
[30]
[42]The
respondent’s general submission is simply that the applicant
has not complied with the peremptory provisions of PAIA,
[31]
and
here reliance is placed on the language of s.53(1), the relevant
portion of which is quoted above.
[43]There is no doubt that the
language of s.53(1) suggests, by the use of the word “
must”
,
that compliance is peremptory. But the substance of the sub-section
is to exact compliance with a regulation, which is in more
accommodating terms. It requires simply that the request “
must
substantially correspond”
with
form C.
[44]The
contents of the letters cover the required contents of form C,
barring fees. But the respondent’s manual says that
the
prescribed fee is only R57 (including VAT), and the applicant in
reply challenged that the manual was on the website at any
time
before 4 February 2016.
[32]
[45]For
the rest, it seems incongruous to say that despite all of the
required information (except the fee) being included in the
letters,
there will not have been “
substantial
correspondence”
with form C
unless the contents of the letters were actually cast in the format
of the form. This might still have been an argument
if the letters
were lengthy and cumbersome, but as is illustrated by their contents,
they were not. They were crisp and to
the point, and there was
no reply to them.
[33]
[46]In my view the applicant has
accordingly substantially complied with the procedural requirements
of PAIA relative to the request
for access to the record of a private
body.
Has
access been refused
[34]
in terms of chapter 4 of part 3 of PAIA?
[47]Here
the onus is on the respondent.
[35]
It is required to put up evidence to persuade a court that, on the
probabilities, the information sought fall within the exemption.
[36]
The respondent’s case on this point is presented in one
paragraph
[37]
in the introduction section of the answering affidavit, and in six
paragraphs under the rubric of “
Confidentiality”
.
[38]
[48]The
case mounted is that the information sought: constitutes
“
confidential information relating
to the inner workings of the respondent’s business”
;
if disclosed, could adversely affect its share price; if disclosed,
its competitors “
could gain an
insight into the respondent’s business transactions.”
In
this latter regard it is said that a competitor could extrapolate the
manner in which the respondent assesses whether a particular
property
represents an attractive investment opportunity.
[39]
A competitor, it is said, could use this information “
to
the respondent’s detriment.”
[40]
[49]Concerning
confidentiality it is said that the ApexHi sale was part of the
larger take-over transaction, and that the details
of the transaction
remain confidential in order to protect the respondent’s
business interests detailed in the various agreements
that comprise
the take-over.
[41]
[50]PAIA
requires, for the exemption to favour a private body, that the
information sought either aspires to “
trade
secrets”
,
[42]
or that the disclosure of the information is “
likely
to cause harm to the commercial or financial interests”
[43]
of the body.
[51]As
to trade secrets: the respondent nowhere asserts that the contents of
the two sale agreements constitute trade secrets. This
is
particularly relevant having regard to the fact that the title deeds
of the property are public documents, available in the
relevant Deeds
Registry. These provide details of the location and size of the
property; they provide particulars of real
rights, including mortgage
bonds and township conditions, over the property; they provide
particulars of the seller of the property;
and they tell one what the
purchase price was.
[44]
[52]The point is not only that
this information cannot constitute trade secrets because it is in the
public domain; the point is
also that the respondent has not
explained why those parts of the sale agreements that do not find
their way into the Deeds Registry,
constitute trade secrets, when
those parts of the sale agreements that do find their way into the
Deeds Registry, obviously no
not constitute trade secrets.
[53]In my view the respondent has
accordingly not discharged the onus of proving that the information
contained in the sale agreements
constitutes trade secrets.
[54]As to whether the disclosure
of the information is “
likely to
cause”
the respondent commercial
or financial harm: two propositions are apposite. First, the
threshold imputes a probability yardstick;
the respondent is required
to show that it is more probable than not that the harm will
eventuate. And here it is of importance
to note that the respondent
has not averred that harm is likely to eventuate. It has
asserted merely that harm “
could”
eventuate. That is not sufficient, because it makes no attempt at
assessing the probabilities of the harm occurring.
[55]The second proposition is
that, in any event, if those aspects of the sale agreements that are
within the public domain do not
cause the respondent commercial or
financial harm, it is difficult to be persuaded that other aspects of
the sale agreements that
are not in the public domain would do it.
Again, there is no attempt at explaining what the topics are that
those other non-disclosed
clauses of the sale agreements deal with,
that would likely have this consequence.
[56]It follows that this aspect
too of s.68 of PAIA has not been satisfied.
Conclusion
[57]As will have been inferred,
in my view the application must succeed. I make an order in the
following terms:
(a)
The
respondent is directed to comply with the request for information
contained in the letter of Smith Tabata Attorneys dated 25
August
2015, annexed to the founding affidavit, within ten days of the
applicant paying the prescribed fee.
(b)
In
particular, the respondent is to provide to the applicant copies of
the deed of sale by which the respondent acquired Erf 3 K
W’s
Town from ApexHi Properties Ltd on or about 12 April, 2010; and the
deed of sale by which the respondent sold that property
to Arrowhead
Properties Ltd on or about 8 September 2011.
(c)
The
respondent is to pay the costs of the application.
WHG van der
Linde
Judge, High
Court
Johannesburg
For the
applicant: Adv. L. Schafer
Instructed
by: Smith Tabata Inc.
c/o Preshnee
Govender Attorneys
147
Grosvenor Road
Bryanston
Tel: 011463
2655
Ref: PG/ch/S113
For the respondent:
Adv. E. Rudolph
Instructed by:
Werksmans Attorneys
155 – 5
th
Street
Sandown
Tel: 011535 8000
Ref: D van den
Berg/REDE 12965.45
Date argued: 15 and 17
June, 2016
Date of
judgement: 24 June 2016
[1]
Notice of motion, pp 1 and 2.
[2]
Answering affidavit, pp 79 to 81, paragraphs 5.1
to 5.4, asp paragraph 5.3.
[3]
Applicant’s supplementary heads of
argument, paragraph 6.3.
[4]
It assumes in its heads of argument that the only
conceivable right can arise from a contract which, since it was
subject to a
suspensive condition, never could give rise to any
rights: see paragraphs 7 to 11.
[5]
Op cit, paragraph 2.2.
[6]
Founding affidavit, page 9, paragraph 12.
[7]
See page 24 for the diagram.
[8]
Ibid.
[9]
Page 52.
[10]
Founding affidavit page 7, paragraph 6.
[11]
Answering affidavit page 86, paragraph 25.
[12]
Annexure D, page 53.
[13]
Ibid, page 54.
[14]
Page 57.
[15]
Clause 8.2, page 62.
[16]
Page 69; see too answering affidavit page 8,
paragraph 10.
[17]
Applicant’s heads of argument, paragraphs
25, 27.3.
[18]
Founding affidavit, page 9, paragraph 15.
[19]
2011 (5) SA 163
(GSJ) at [334].
[20]
2001 (3) SA 1013 (SCA).
[21]
Ibid, at [24]. See also [29].
[22]
Reported at
1999 (4) SA 1184
(C) at 1196.
[23]
2005 (3) SA 486 (SCA).
[24]
See generally, LAWSA, 2
nd
ed, vol 8, Part 1, Delict, by JR Midgley and JC Van der Walt, at
paragraph 60. Compare Neethling – Potgieter – Visser,
Law of Delict, by J Neethling and JM Potgieter, 7
th
ed, page 69, paragraph 5.2.5.
[25]
Answering affidavit, page 80, paragraph 5.3.
[26]
At [13].
[27]
Answering affidavit, page 79, paragraph 5.1.
[28]
On 15 February 2002 in GG 23119, GN R187, and
subsequently amended.
[29]
Only the last two are part of these papers, being
annexures F and G respectively, at pages 70, 72.
[30]
Answering affidavit, page 95, “
Completion
and submission of the access request form (Form C).”
[31]
Answering affidavit, page 82, paragraph 11.
[32]
Replying affidavit, page 107, paragraph 7.
[33]
Founding affidavit, page 10, paragraph 17.
[34]
There has been a deemed refusal; s.58, read with
s.56(1), of PAIA, and founding affidavit, page 10, paragraph 17.
[35]
S.81(3) of PAIA.
[36]
President of the Republic of South Africa and
Others v M & G Media Ltd,
2012 (2) SA 50
(CC) at [23].
[37]
Page 80, paragraph 5.2.
[38]
Page 83, paragraphs 12 to 17.
[39]
Answering affidavit, page 83, paragraph 14.
[40]
Answering affidavit, page 84, paragraph 15.
[41]
Answering affidavit, page 84, paragraph16.
[42]
S.68(1)(a).
[43]
S.68(1)(b).
[44]
Compare founding affidavit, annexure D, pages 53
to 56.