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[2016] ZAGPJHC 169
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Edcar Rubber Liners CC and Others v Rema Tip Top Holdings SA (Pty) Ltd and Others (24615/2015) [2016] ZAGPJHC 169 (24 June 2016)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO:
24615/2015
DATE:
24 JUNE 2016
In
the matter between:
Edcar
Rubber Liners CC (In
Liquidation)
....................................................................
First
Applicant
Surmany,
Albert Ivan
N.O
...........................................................................................
Second
Applicant
Buwa,
Patrick Dumisani
N.O
........................................................................................
Third
Applicant
Cowin,
Monica Gezina
N.O
.........................................................................................
Fourth
Applicant
And
Rema
Tip Top Holdings SA (Pty)
Ltd
.........................................................................
First
Respondent
John
Davies Pipeline Services
CC
...........................................................................
Second
Respondent
Marques,
Miguel
.........................................................................................................
Third
Respondent
Davies,
John
Robert
..................................................................................................
Fourth
Respondent
Problast
(Pty)
Ltd
.........................................................................................................
Fifth
Respondent
Judgement
Van der Linde, J:
Introduction
1) This is an application by the liquidators of an
insolvent close corporation for an interim interdict to prevent the
first respondent
from using, or giving permission to others to use,
an autoclave and boiler pending an action to determine their
ownership. The
liquidators assert ownership in their representative
capacity, but the first respondent contends that it is the owner.
[1]
2) An autoclave is an oven which is used for heating
rubber to enable it to be moulded into shape. The boiler provides the
heat.
[2]
The equipment is large and heavy, and can be moved only with extreme
difficulty. It is attached to the surface on which it sits
by bolts
and cement, and to remove it would require destruction of the brick
room within which it is located, a heavy duty crane,
and an abnormal
load truck. This particular autoclave and boiler combination has been
at its present location since approximately
2009.
[3]
3) The applicant applies not to attach
[4]
and remove the equipment, nor simply to attach it. It seeks merely to
interdict its user, on the basis that this will expose the
equipment
to risk of destruction or, at least, to diminution in value. These
aspects are disputed, the respondent asserting that
the equipment is
made of steel, does not wear out, was manufactured in 1975, and has
been in use since then.
[5]
A prima facie right:
the test
4) But the discussion starts with earlier, around
the disputed issue of ownership. Since the relief sought is interim
the applicants
need only establish a prima facie right, although open
to doubt. More specifically, the applicants must show that on their
version,
together with the allegations of the respondents that they
cannot dispute, they should obtain relief at the trial. If, having
regard
to the respondents contrary version and the inherent
probabilities serious doubt is then cast on the applicants’
case, the
applicants cannot succeed.
[6]
5) This tried and tested approach was significantly
qualified by a full bench of this court in Ferreira v Levin, NO and
Others;
Vryenhoek and Others v Powell, NO and Others.
[7]
Ferreira, which received the imprimatur of the Constitutional
Court,
[8]
materially lowered the bar set by Gool. The latter required that on
the asserted case the applicant “
should”
obtain
final relief at trial; the former requires only “
a”
prospect of success, albeit “
weak.”
6) The correct perspective, however, of these
ostensibly dichotomous positions is, in my view, captured by Holmes,
J (then) in Olympic
Passenger Service (Pty) Ltd v Ramlagan,
[9]
approved by Holmes, JA in Erikson Motors (Welkom) Ltd v Protea
Motors, Warrenton, and Another,
[10]
in
turn followed by Ferreira, and approved by the Constitutional Court:
“
It thus appears
that where the applicant's right is clear, and the other requisites
are present, no difficulty presents itself about
granting an
interdict. At the other end of the scale, where his prospects of
ultimate success are nil, obviously the Court will
refuse an
interdict. Between those two extremes fall the intermediate cases in
which, on the papers as a whole, the applicants'
prospects of
ultimate success may range all the way from strong to weak. The
expression 'prima facie established though open to
some doubt' seems
to me a brilliantly apt classification of these cases. In such cases,
upon proof of a well-grounded apprehension
of irreparable harm, and
there being no adequate ordinary remedy, the Court may grant an
interdict - it has a discretion, to be
exercised judicially upon a
consideration of all the facts. Usually this will resolve itself into
a nice consideration of the prospects
of success and the balance of
convenience - the stronger the prospects of success, the less need
for such balance to favour the
applicant: the weaker the prospects of
success, the greater the need for the balance of convenience to
favour him. I need hardly
add that by balance of convenience is meant
the prejudice to the applicant if the interdict be refused, weighed
against the prejudice
to the respondent if it be granted.”
7) The approach approved then by these authorities
is that “
a prima facie right, though open to some doubt”
conveys that the strength of the right is allowed to fluctuate from
strong to weak: if it is strong, the other requirements for
an
interim interdict may be weak; if it is weak, the other requirements
for an interim interdict may be strong.
8) The perspective of the meaning of “
a
prima facie right, although open to some doubt”
, as
collected by Ferreira from Erikson Motors and Olympic Passenger
Service and approved by the Constitutional Court, seems to
me to
render future reliance on Webster and Gool otiose. Of course, the
remedy remains “
an extraordinary remedy within the
discretion of the Court,”
as Erikson Motors
underscored,
[11]
but
that is a description apt for the entire discretion-exercising
process, not only the first element of it.
The applicants’
case
9) The case mounted by the applicants is that Edcar
concluded an oral agreement with Specialised Rubber Products (Pty)
Ltd (“SRP”)
in terms of which it would borrow the
equipment from SRP for two years to manufacture rubber linings. In
terms of this agreement,
if Edcar then purchased rubber worth R2m
from SRP during the two years of the lease, Edcar would acquire
ownership of the equipment.
[12]
10) The witnesses relied on by the applicants
are the two members of Edcar, De Bruin as to 30% and Marques as to
70%. The
respondent argues that their versions are thoroughly
unsatisfactory for a number of reasons, one of which is that the
versions
are inherently contradictory. De Bruin says in one place
that the R2m was not achieved,
[13]
but
Marques disputes this asserts that the purchase volume was in fact
achieved.
[14]
In
other places De Bruin alleges that the R2m mark was obtained.
[15]
His subsequent evidence at an insolvency enquiry was ambivalent.
[16]
11) These two witnesses do not date their oral
agreement. That is important, because one does not know then when the
two year
period commences running. It must have been concluded before
September 2009, however, as that is when according to Marques, the
business of SRP, including the agreement between the first applicant
and SRP, was sold to the first respondent.
[17]
12) And it is likely that the agreement was
concluded in 2008, probably 29 October 2008, because that is the
starting date
for Marques’ calculation of an aggregate of
R2678262.48 purchases by 15 September, 2010.
[18]
This period is said to include the purchases of both SRP and,
subsequent to the sale of the business to the first respondent, the
latter.
13) The difficulty for the success of this
version is that on 16 September 2009, SRP (the written agreement says
“
Specialised Rubber and Industrial (Pty) Ltd”
, but
that is probably a misnomer
[19]
)
entered into a written agreement with the first respondent for the
acquisition of this equipment.
[20]
This agreement, properly interpreted,
[21]
provides
for the transfer of ownership of the equipment to the first
respondent Remus on that date.
14) Since by 15 December 2009, which is a date
after 16 September 2009, the first applicant had – on its own
version
– purchased only R1986925.85 worth of rubber from
SRP,
[22]
the
first applicant could not have acquired ownership before the written
agreement in terms of which SRP sold the equipment and
transferred
ownership to the first respondent.
[23]
15) The applicants’ answer to this
agreement is that the respondents’ affidavits do not say when
in terms of this
agreement ownership passes. But in my view, as a
matter of law, such evidence was not only unnecessary but probably
inadmissible
as offending the parol evidence rule. The written
agreement is the legal constitution of the parties’ rights and
obligations.
It deals expressly with what the purchaser acquires on
the defined effective date. The clauses identified in an earlier
footnote
convey, in my view conclusively, that ownership was intended
to pass on the “
Effective Date”
, as defined.
16) Add to this the following: the equipment
is, on the admissible factual matrix,
[24]
massive. Assuming it is legally a movable, delivery – a
necessary constituent for the passing of ownership – will
likely take the form of
constitutum possessorium.
The written
agreement expressly reposes physical possession of the equipment in
the purchaser on the effective date.
[25]
That feature adds to the conclusion that the agreement was intended
to transfer ownership.
17) The applicants argue that the annexure A
was not initialed. But that is not a requirement for the validity of
the agreement.
They say that other annexures referred to in the
agreement were not included in the papers, and that these may through
a different
light on the agreement. They may, or not; that is, with
respect, speculative.
[26]
It is improbable that they do, since the the express wording of the
clauses dealing with what is transferred to the purchaser do
not
refer to these annexures.
18) The applicants argue that the payment
clause envisages that a portion of the purchase price is payable in
instalments,
and that one would have expected that ownership would
have been reserved until the price was fully paid. But it is not so
reserved
in terms of the agreement, and on the parol evidence rule
that is the end of the matter. If anything, the law is that in credit
sales ownership passes on delivery, and not only on full payment;
that applies to cash sales.
Conclusion
19) In these circumstances the applicants have not
shown a prospect of success at trial on these papers, and thus have
not shown
a prima facie right, although open to some doubt. Even
weighing in the requirement of a favourable balance of convenience,
assuming
in the applicants’ favour that they need not show a
reasonable apprehension of irreparable harm and no other satisfactory
remedy, I cannot conclude that the relief sought ought to be granted,
for these reasons.
20) The equipment is, in local parlance, going
nowhere. It is by virtue of its size such a presence that if that
should happen,
the applicants will get to know about it.
21) The risk of total destruction is difficult to
visualize. But if there is such a risk, it will remain, even if the
relief is
granted, because the equipment will remain. The risk of
value deterioration through user during the time it takes for this
matter
to get to trial is, with respect, speculative. The convenience
is therefore not balanced in favour of the equipment being frozen.
22) It follows that in my view the application
cannot succeed, and it is dismissed with costs.
WHG van der Linde
Judge, High Court
Johannesburg
For the applicant: Adv. L. Hollander
Instructed by: Jason Micheal Smith Inc.
Suite 1, 26 Baker Street
Rosebank
Tel: 011 447 8188
Ref: K.Vinokur-RMG1/0001
For the first respondent: Adv. A.D. Wilson
Instructed by: Spells Lengert Kuebler Braun Inc
64 4
th
Avenue
Melville
Tel: 011 482 1431
Ref: F Lengert/REM2/0001
Date argued: 17 June, 2016
Date of judgment: 24 June, 2016
[1]
It also owns, it says, many other autoclaves and
boilers at many other locations; answering affidavit page 169,
paragraph 8.4.
[2]
Answering affidavit, page 169, paragraphs 8.8 and
8.9.
[3]
Answering affidavit, page 170, paragraphs 8.10 to
8.13.
[4]
It is not an application for an attachment of
goods pending a vindicatory action, as to which see SA Taxi
Securitisation (Pty)
Ltd v Chesane,
2010 (6) SA 557
(GSJ) at [6].
[5]
Answering affidavit, page 178, paragraphs 38, 39.
[6]
Webster v Mitchell,
1948 (1) SA 1186
(W) at
11189, as qualified by Gool v Minister of Justice and Another,
1955
(2) SA 682
(C) at 688E.
[7]
1995 (2) SA 813
(W).
[8]
South African Informal Traders Forum and Others v
City of Johannesburg and Others,
2014 (4) SA 371
(CC) at [25].
[9]
1957 (2) 382 (D) at 383 D.
[10]
1973 (3) SA 685
(A) at 691.
[11]
At 691.
[12]
Founding affidavit, page 14, paragraphs 33.1.1
and 33.1.2.
[13]
Op cit
, page 12, paragraph 10.
[14]
Op cit
, page 13, paragraphs 5, 6.
[15]
Op cit
, page 18, paragraph 39.
[16]
Op cit, page 31.
[17]
Op cit, page 13, paragrapg 4.
[18]
Op cit, page 13, paragraphs 6,7.
[19]
Op cit, page 14, paragraphs 30, 31.
[20]
Answering affidavit, annexure SF 3, pages 184 and
following.
[21]
Clauses 3.1 to 3.3; 4.1; 4.5; 5.1; 5.1.1 to
5.1.4; and 6.1 .1 to 6.1.3.
[22]
Founding affidavit, page 13, paragraph 6.
[23]
Whether there lies a breach of contract action by
the first applicant against the first respondent, as successor to
SRP, is another
matter, but it need not detain the present enquiry.
[24]
As to which, see KPMG Chartered Accountants (SA)
v Securefin Ltd and Another
2009 (4) SA 399
(SCA): “
[39]
First, the integration (or parol evidence) rule remains part of our
law. However, it is frequently ignored by practitioners
and seldom
enforced by trial courts. If a document was intended to provide a
complete memorial of a jural act, extrinsic evidence
may not
contradict, add to or modify its meaning (Johnson v Leal
1980
(3) SA 927
(A) at 943B). Second, interpretation is a matter of law
and not of fact and, accordingly, interpretation is a matter for the
court and not for witnesses (or, as said in common-law
jurisprudence, it is not a jury question: Hodge M Malek (ed) Phipson
on
Evidence (16 ed 2005) paras 33 - 64). Third, the rules about
admissibility of evidence in this regard do not depend on the nature
of the document, whether statute, contract or patent (Johnson &
Johnson (Pty) Ltd v Kimberly-Clark Corporation and Kimberly-Clark
of
South Africa (Pty) Ltd 1985 BP 126 (A) ([1985] ZASCA 132 (at
www.saflii.org.za)). Fourth, to the extent that evidence may
be
admissible to contextualise the document (since 'context is
everything') to establish its factual matrix or purpose or for
purposes of identification, 'one must use it as conservatively as
possible' (Delmas Milling Co Ltd v Du Plessis
1955 (3) SA 447
(A) at 455B - C). The time has arrived for us to accept that there
is no merit in trying to distinguish between'background
circumstances' and 'surrounding circumstances'.
The distinction is artificial and,
in addition, both terms are vague and confusing. Consequently,
everything tends to be admitted.
The terms 'context' or 'factual
matrix' ought to suffice. (See Van der Westhuizen v Arnold
2002
(6) SA 453
(SCA) ([2002]
4 All SA 331)
paras 22 and 23, and
Masstores (Pty) Ltd v Murray & Roberts Construction (Pty) Ltd
and Another
[2008] ZASCA 94
;
2008 (6) SA 654
(SCA) para 7.)”
[25]
Annexure SF 3, page 193, clause 6.1.1.
[26]
These could have been obtained under the High
Court rules.