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2021
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[2021] ZAGPJHC 10
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Medicross Healthcare Group (Pty) Limited v EXP Healthcare Solutions (Pty) Ltd and Others (446/2021) [2021] ZAGPJHC 10 (13 January 2021)
IN THE HIGH
COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
(1)
REPORTABLE:
NO
(2)
OF INTEREST TO OTHER
JUDGES:
NO
(3)
REVISED:
CASE
NO
:
446/2021
DATE
:
13
th
January 2021
In
the matter between:
MEDICROSS
HEALTHCARE GROUP (PTY) LIMITED
Applicant
and
EXP
HEALTHCARE SOLUTIONS (PTY) LIMITED
First Respondent
DR
CORRIE KROON AND ASSOCIATES
INC
Second Respondent
KROON
,
DR
CORNELIS
Third Respondent
DU
PREEZ
, DR HENDRIK
GIDEON
Fourth Respondent
ICE
BREAKERS 96 (PTY)
LIMITED
Fifth Respondent
Coram:
Adams
J
Heard
:
12 January 2021 – The ‘virtual hearing’ of the
application was conducted as a videoconference on the
Microsoft
Teams
digital platform.
Delivered:
13 January 2021 – This judgment was handed down
electronically by circulation to the parties' representatives by
email, by
being uploaded to the
CaseLines
system of the GLD
and by release to SAFLII. The date and time for hand-down is deemed
to be 15h00 on 13 January 2021.
Summary:
Urgent application – interdictory relief
–
mandament van spolie
–
urgent application for eviction from business premises
– application granted –
ORDER
(1)
The matter is urgent.
(2)
The first respondent is directed to:
(2.1)
vacate and immediately restore the
applicant’s full and undisturbed occupation and possession in
and to the property situated
on the ground floor of the building on
the premises at the corner of Peter Mokaba and James Moroka Street,
previously known as
Van Riebeeck and Lombard Streets, Potchefstroom
(‘the property’), including that area designated for a
medical practice;
(2.2)
replace and restore:
(2.2.1)
all the applicant’s logos, marks and other signage that
were
previously affixed to the property;
(2.2.2)
all of the applicant’s computer equipment,
computer network
system, PABX system, printing, accounting and other administrative
infrastructure (‘the infrastructure’);
(2.2.3)
the applicant’s medical equipment and other
devices (‘the
equipment’) to its previously installed positions;
(2.2.4)
all of the applicant’s medical supplies removed
from the
medical supply cabinets;
(2.2.5)
the applicant’s sole and unrestricted access
to the property
and its medical centre on the property. In this regard the
respondents are required to provide the applicant with
sole access to
all locks which give access to the property, including the access
codes;
(2.2.6)
all keys and access codes in respect of all locks
on the property and
to surrender any keys and access codes which are in their, or their
representatives’ possession;
(2.2.7)
all the applicant’s business operations to
the property and to
allow the applicant to conduct its business, administering a medical
centre, including a medical practice of
its choice, on the property
under the Medicross name;
(2.3) not further interfere with or restrict the
applicant’s use and enjoyment of the property;
(3)
The second, third and fourth respondents
are directed to:
(3.1)
immediately restore the applicant’s
full occupation and possession in and to the property, including that
area of the ground
floor making up the medical practice;
(3.2)
replace and restore:
(3.2.1)
all of the applicant’s logos, marks and other
signage that were
previously affixed to the property;
(3.2.2)
the infrastructure;
(3.2.3)
the equipment to their previously installed positions;
(3.2.4)
all of the applicant’s medical supplies removed
from the
medical supply cabinets;
(3.2.5)
the applicant’s business operations to the
property and to
allow the applicant to peacefully conduct its business, of
administering a medical practice of its choice, on the
property under
the Medicross name;
(3.2.6)
all keys and access cards in respect of all locks
on the property and
to surrender all keys and access codes which are in their, or their
representatives’, possession;
(3.3) not
further interfere with the applicant’s use and enjoyment
of the
property;
(4)
The second respondent is directed to vacate
itself, including its assets, from the property within five (5) days
of this order;
(5)
In the event of the second respondent not
vacating or failing to vacate the property within five (5) days from
the date of this
order, the sheriff of the court be and is hereby
authorised and directed to evict the second respondent, including
anybody being
in occupation of the property through and by virtue of
the second respondent, from the property;
(6)
The applicant is granted leave to join the
business rescue practitioner, appointed for the second respondent,
and to proceed with
the urgent application, insofar it may be
necessary, against the second respondent under business rescue;
(7)
The fifth respondent is directed to:
(7.1) maintain
the
status quo
in respect of the lease agreement entered into
between the applicant and the fifth respondent;
(7.2) afford
the applicant the full and unrestricted use of the property,
as is
provided for in the written agreement of lease, dated 25 September
2012;
(8)
The first to fourth respondents are
directed to jointly and severally, the one paying the other to be
absolved, pay the applicant’s
costs of the application on the
attorney and client scale, such costs to include the costs consequent
on the employment of two
counsel, one being a Senior Counsel.
JUDGMENT
Adams J:
[1].
This is an
opposed urgent application by the applicant, Medicross Healthcare
Group (Pty) Limited (‘Medicross’), for
an order
reinstating it to business premises, which it leases in terms of a
written commercial lease from the fifth respondent,
Ice Breakers 96
(Pty) Limited (‘Ice Breakers’), and which premises
Medicross utilises to house the second respondent,
Dr Corrie Kroon
and Associates (‘Kroon and Associates’). Until the 31
st
of December 2020 Medicross administered the medical practice of Dr
Kroon and Associates, of which the third respondent, Dr Kroon,
and
the fourth respondent, Dr Du Preez, are shareholders and directors.
This Medicross did in terms of and pursuant to a suite
of agreements
between Medicross and Dr Kroon and Associates, including an
administration agreement. Dr Kroon and Dr Du Preez are
also
shareholders and directors of Ice Breakers, which is the owner of the
leased immovable property and the business premises.
The
administration agreement came to an end at the end of December 2020,
which means, so Medicross alleges, that Dr Kroon and Associates
no
longer had any right to occupy these premises and an order evicting
the said company from the premises is also sought.
[2].
The
respondents oppose the application on a number of grounds, notably on
the basis that there is no urgency in the matter and also
on the
basis that Medicross was not spoliated.
[3].
As indicated,
in this spoliation application Medicross seeks an order reinstating
its erstwhile peaceful and undisturbed possession
of certain premises
situated at the corner of Peter Mokaba and James Moroka Street,
Potchefstroom (‘the property’).
Medicross contends that
it has been spoliated by the first respondent, EXP Healthcare
Solutions (‘EXP’), and the second
respondent (‘Kroon
& Associates’) over the weekend of 1 to 4 January 2021.
[4].
The crisp
issues in this urgent application is whether the applicant was in
peaceful and undisturbed possession of the premises
up to and until
the 31
st
of December 2020 and whether such possession was unlawfully
interfered with by the respondents. The respondents also contend that
in this urgent application the applicant has failed to demonstrate
urgency and a need for it not to comply with the ordinary rules
of
this court. These issues are to be decided against the factual
backdrop, which I set out in the following paragraphs.
[5].
Medicross
utilises and applies the property for purposes of conducting a
medical centre and has done so since 1995 from which time
it has been
in peaceful and undisturbed possession of the said property. Its
occupation of the property is in terms of and pursuant
to a written
agreement of lease concluded between Ice Breakers, the owner of the
property – acting as lessor – and
Medicross, the lessee.
The lease at present is extant and enforceable and remains in place
for the foreseeable future.
[6].
Medicross
carries on business as administrators of medical practices. For
purposes of conducting and operating a medical centre,
it would lease
a building and then, in turn, would make portions of the building
available to the medical practices which would
form an integral part
of a
Medicross
Medical Centre
.
In the present instance the medical centre situated on the property
consists of a medical practice, a dentistry practice, a day
hospital
and a pharmacy. Medicross uses the remainder of the building and the
premises for its own purposes, being the rendering
of administrative
and other services to the medical and dentistry practices.
[7].
EXP is a
competitor of Medicross in the market and it has entered into an
administration agreement with Kroon & Associates,
seemingly
taking over the administration of that practice with effect from 1
January 2021, that is after the administration agreement
between
Medicross and Kroon and Associates came to an end.
[8].
Up to 31
December 2020 Medicross rendered the service of an administrator to
Dr Kroon & Associates, thus attending to the administration
of
the medical practice and rendering related services, which included
the supplying of medical supplies to the practice conducted
by Dr
Kroon & Associates. Medicross rendered these administrative
services in terms of an administration agreement, entered
into
between the parties. In terms of the administration agreement
Medicross was
inter
alia
obliged to make available to Dr Kroon & Associates suitable
premises from where it could conduct its medical practice. It is
by
virtue of this arrangement that Dr Kroon & Associates was in
lawful occupation of part of the ground floor of the building
situated on the property until 31 December 2020, when its right to
lawfully occupy that part of the ground floor terminated.
[9].
EXP and Kroon
& Associates, assisted by Dr Kroon and Dr Du Preez, however
spoliated Medicross of its possession and peaceful
occupation of the
entire ground floor of the building. This is borne out by the
evidence and all of this happened on the weekend
of the 1
st
to the 4
th
of January 2021. Kroon & Associates – who previously
occupied only part of the ground floor in terms of the administration
agreement – now opportunistically refuses to vacate that
portion of the ground floor which it occupied in terms of the
administration
agreement.
[10].
As regards
urgency, it is the case of Medicross that it has contracted with
another medical practice, Dr A E Smook & Associates
Incorporated
(‘Smook & Associates’), to attend to the
administration of their medical practice as part of its medical
centre. Similar to Dr Kroon & Associates the medical practice of
Smook & Associates will be using part of the ground floor
of the
building. Not only is Medicross effectively being prevented from
operating its medical centre on the property, but it is
also
prevented from rendering administrative services to Smook &
Associates. Smook & Associates is also effectively barred
and
prevented from taking occupation and establishing itself on the
ground floor of the building. As submitted by Mr Stockwell
SC, who
appeared on behalf of the applicant with Mr Posthumus, the prejudice
flowing from the aforesaid is apparent and it is equally
apparent
that this unfortunate state of affairs needs to be remedied as soon
as possible.
[11].
In any event,
by virtue of the blatant lawlessness implicit in the conduct of the
respondents and the fact that the very nature
of spoliation
proceedings demands a speedy remedy, I am persuaded that the matter
is urgent. It is necessary to prevent members
of the public from
taking the law into their own hands or to resort to self-help, and do
so with expeditiously. This is exactly
what EXP and Dr Kroon &
Associates made themselves guilty of in the present proceedings.
[12].
The rule of
law requires that the brazen conduct of EXP, on instructions of Dr
Kroon and Associates, be frowned upon. They cannot
be heard to
complain that there is no need for the applicant to have taken this
legal action in the face of their unlawful conduct.
[13].
The point is
that EXP and Dr Kroon and Associates have no right to be on the
property and their attempts to strong arm Medicross
and to insist not
only on remaining in occupation of that portion of the premises
previously occupied by them in terms of the administration
agreement
but also to take over the rest of the premises, should be dealt with
expeditiously. Such unlawful conduct does not belong
in a civilised
society.
[14].
What the
respondents did was to bypass court processes. This is unacceptable
and unless the applicant is granted relief on an urgent
basis, the
respondents will be allowed to engage in impermissible acts of
self-help. The right of access to court is the bulwark
against
vigilantism and the chaos and anarchy which it causes.
[15].
The flipside
of the coin is that Medicross has every right to occupation of the
property. It has been in occupation of the property
since 1995. In
2012 it entered into a new agreement of lease with Ice Breakers in
terms of which Medicross leased the property
for ten years. Upon
expiration of the initial ten-year period, Medicross has an option to
further extend the period of the lease.
Medicross can extend the
lease for two further periods of five years each. The right of
Medicross in and to the property, including
its right to be in
occupation of the property, cannot be disputed in light of the
provisions of the agreement of lease. I am therefore
satisfied that
the matter is urgent
[16].
As regards Dr
Kroon and Associates, which is presently in business rescue and
unrepresented in these proceedings, the respondents
contend
in
limine
that the applicant has instituted proceedings without the consent of
the business rescue practitioner or the court in contravention
of
section 133
of the
Companies Act 71 of 2008
. There is no merit in
this legal point.
[17].
On the 8
th
of January 2021 Dr Kroon and Associates delivered notice of intention
to oppose the applicant’s urgent application and on
the very
same day their attorneys withdrew as attorneys of record. There is no
doubt in my mind that the Business Rescue Practitioners
are aware of
these proceedings and the inference to be drawn is that they will
abide the Court’s decision. This is also borne
out by
correspondence from them.
[18].
The fact that
the Business Rescue Practitioners have not been specifically cited
should also not stand in the way of the granting
of the relief, if
for no other reason than on the basis that in the administration of
justice form should never be elevated above
substance. As was said in
Gainsford
NO v Tanzer Transport (Pty) Ltd
2014 (3) SA 468
(SCA) para 14:
‘
As
stated above, Mailula J was correct ... to have regard to the
provisions of
s 386(5)
, which demonstrate that liquidators act in the
stead of the company in liquidation. A distinction between the
locus
standi
accorded to the company in liquidation and that of its liquidators
acting in their representative capacity, is pedantic or illusory.
To
disqualify liquidators properly appointed from acting on behalf of a
company in liquidation would truly be elevating form above
substance.’
[19].
Although
concerned in that case with liquidators, there is in principle no
difference as between a company in liquidation and one
in business
rescue in these circumstances. The business rescue practitioner in
terms of
section 140(1)(a)
of the
Companies Act ‘has
full
management control of the company in substitution for its board and
pre-existing management’.
[20].
In any event,
on a plain reading of the Act,
section 133
is not applicable
in
casu
.
Section 133
provides as follows:
‘
133
General
moratorium on legal proceedings against company
(1)
During
business rescue proceedings, no legal proceeding, including
enforcement action against the company, or in relation to any
property belonging to the company, or lawfully in its possession, may
be commenced or proceeded with in any forum, except –
(a)
with
the written consent of the practitioner;
(b)
with
the leave of the court and in accordance with any terms the court
considers suitable.
”
[21].
As rightly
contended by Mr Stockwell, the moratorium applies only where the
claim is for property lawfully in the possession of
the corporation
in business rescue. In proceedings for property unlawfully in
possession of the corporation, the moratorium does
not apply and the
proceedings are permissible, without consent. The occupation of the
business premises in this matter is unlawful,
the legal basis for
such occupation – the administration agreement – having
been terminated effective the 31
st
of December 2020, and accordingly the moratorium in
section 133
does
not apply. This point
in
limine
is
therefore dismissed.
[22].
As regards the
merits of the urgent application, the respondents’ main
contention relating to the applicant’s right
to occupy the
premises is an averment to the effect that the Ice Breakers would not
have concluded the agreement of lease, had
it envisaged that a
different practice to that of Dr Kroon & Associates would occupy
the medical section of the building. There
is no merit is this
contention, which loses sight of the non-representation and
non-variation clauses in the lease agreement. The
respondents are
clutching at straws.
[23].
In addition,
it must be borne in mind that Medicross assisted Ice Breakers by
financing the transaction. This enabled Ice Breakers
to acquire the
property. This was done in order to assist the shareholders to obtain
an interest in the property. The fact of the
matter is that Medicross
had a lease with the previous owner of the building and then financed
the acquisition of the building,
purely to assist the shareholders as
a gesture of kindness and cooperation.
[24].
It bears
emphasising that Dr Kroon & Associates had no right to and did
not occupy any part of the building other than that
portion which
housed their practice. More specifically, Dr Kroon & Associates
did not occupy the reception area, situated on
the ground floor. This
area of the ground floor, consisting of a reception area, has since
been spoliated from Medicross’
possession. Medicross was
spoliated by EXP who presently occupies that area, probably with
Kroon & Associates. Apart from the
reception area, there is also
a pharmacy. The pharmacy is able to continue doing business as it did
in the past.
[25].
The
administration agreement terminated on 31 December 2020. Accordingly,
Kroon & Associates’ right to further occupy
that section of
the ground floor, designated for a medical practice, came to an end.
In terms of the administration agreement,
Kroon & Associates,
including the medical practitioners who practice as part of that
medical practice, undertook and agreed
to vacate the property,
particularly the area occupied in terms of the administration
agreement.
[26].
The process of
spoliation commenced on 1 January 2021, when Dr Kroon threatened and
coerced an employee of Medicross to give him
access to the building
on the property. Once Dr Kroon had access to the building, he, duly
assisted by EXP, once it had gained
access to the building, commenced
removing Medicross’ signage, its telephone system and its
administrative infrastructure.
This process was overseen by Dr Du
Preez. In addition to the aforesaid, EXP started establishing their
own telephone system and,
one would assume, their own administrative
infrastructure. I agree with the applicant that this is conduct
unequivocally directed
at spoliating Medicross from the building,
which property it is leasing from Ice Breakers.
[27].
On Monday
morning, 4 January 2021, when Medicross’ medical centre was
scheduled to reopen, EXP was present on site and its
representatives
inter alia
prevented Medicross’ staff, who are required to render services
to the medical practice, from entering the building and from
attending to their duties. In addition to the aforesaid, the
receptionist and administrative staff, who worked on the ground
floor,
were precluded from taking up their posts. This was due to the
fact that their working spaces had been either replaced with working
stations for the EXP staff, or had otherwise been removed. The
aforesaid is the very definition of spoliation.
[28].
Apart from the
aforestated spoliation, EXP also proceeded to change a number of
locks on the doors giving access to the building
and other areas. In
addition to the aforesaid, access was gained, and locks were changed,
giving access to cabinets which Medicross
used to store medical
supplies and confidential papers. The medical supplies are the
property of Medicross and was used by Medicross
to supply the medical
practice and dentistry with medical supplies, if and when required.
As mentioned, the administration agreement
came to an end. Apart from
the fact that Kroon & Associates is required to vacate the
property, there is also no further obligation
on Medicross to further
supply Kroon & Associates with medical supplies.
[29].
EXP and Kroon
& Associates however took the law into their own hands. They
forcefully opened the cabinets where the supplies
were stored and
started using these medical supplies, which is the property of
Medicross. The aforestated misappropriation by EXP
and Kroon &
Associates is nothing short of common theft.
[30].
EXP’s
forceful opening of a cabinet containing confidential information,
unique to Medicross’ business model and practice,
is yet
another example of EXP’s unlawful conduct. In that regard, they
are probably motivated by a need to compete in the
medical practice
administration market in which Medicross is a major role player.
[31].
Accordingly,
the relief sought by the applicant should be granted.
Costs
[32].
The general rule in matters of costs is
that the successful party should be given his costs, and this rule
should not be departed
from except where there are good grounds for
doing so, such as misconduct on the part of the successful party or
other exceptional
circumstances. See:
Myers
v Abramson
, 1951(3) SA 438 (C) at 455.
[33].
I can think of no reason why I should
deviate from this general rule.
[34].
Mr Stockwell has also urged me to grant a
punitive costs order on the scale as between attorney and client to
show the court’s
displeasure with the conduct on the part of
the respondents. I am not persuaded that in this matter a case has
been made out for
punitive costs
[35].
I therefore intend awarding cost against
the first, second, third and fourth respondents in favour of the
applicant.
Order
Accordingly,
I make the following order: -
(1)
The matter is urgent.
(2)
The first respondent is directed to:
(2.3)
vacate and immediately restore the
applicant’s full and undisturbed occupation and possession in
and to the property situated
on the ground floor of the building on
the premises at the corner of Peter Mokaba and James Moroka Street,
previously known as
Van Riebeeck and Lombard Streets, Potchefstroom
(‘the property’), including that area designated for a
medical practice;
(2.4)
replace and restore:
(2.2.1)
all the applicant’s logos, marks and other signage that
were
previously affixed to the property;
(2.2.2)
all of the applicant’s computer equipment,
computer network
system, PABX system, printing, accounting and other administrative
infrastructure (‘the infrastructure’);
(2.2.3)
the applicant’s medical equipment and other
devices (‘the
equipment’) to its previously installed positions;
(2.2.4)
all of the applicant’s medical supplies removed
from the
medical supply cabinets;
(2.2.5)
the applicant’s sole and unrestricted access
to the property
and its medical centre on the property. In this regard the
respondents are required to provide the applicant with
sole access to
all locks which give access to the property, including the access
codes;
(2.2.6)
all keys and access codes in respect of all locks
on the property and
to surrender any keys and access codes which are in their, or their
representatives’ possession;
(2.2.7)
all the applicant’s business operations to
the property and to
allow the applicant to conduct its business, administering a medical
centre, including a medical practice of
its choice, on the property
under the Medicross name;
(2.3) not
further interfere with or restrict the applicant’s use and
enjoyment of the property;
(3)
The second, third and fourth respondents
are directed to:
(3.1)
immediately restore the applicant’s
full occupation and possession in and to the property, including that
area of the ground
floor making up the medical practice;
(3.2)
replace and restore:
(3.2.1)
all of the applicant’s logos, marks and other
signage that were
previously affixed to the property;
(3.2.2)
the infrastructure;
(3.2.3)
the equipment to their previously installed positions;
(3.2.4)
all of the applicant’s medical supplies removed
from the
medical supply cabinets;
(3.2.5)
the applicant’s business operations to the
property and to
allow the applicant to peacefully conduct its business, of
administering a medical practice of its choice, on the
property under
the Medicross name;
(3.2.6)
all keys and access cards in respect of all locks
on the property and
to surrender all keys and access codes which are in their, or their
representatives’, possession;
(3.3) not
further interfere with the applicant’s use and enjoyment
of the
property;
(4)
The second respondent is directed to vacate
itself, including its assets, from the property within five (5) days
of this order;
(5)
In the event of the second respondent not
vacating or failing to vacate the property within five (5) days from
the date of this
order, the sheriff of the court be and is hereby
authorised and directed to evict the second respondent, including
anybody being
in occupation of the property through and by virtue of
the second respondent, from the property;
(6)
The applicant is granted leave to join the
business rescue practitioner, appointed for the second respondent,
and to proceed with
the urgent application, insofar it may be
necessary, against the second respondent under business rescue;
(7)
The fifth respondent is directed to:
(7.1) maintain
the
status quo
in respect of the lease agreement entered into
between the applicant and the fifth respondent;
(7.2) afford the
applicant the full and unrestricted use of the property, as is
provided for in the written agreement of lease, dated 25 September
2012;
(8)
The first to fourth respondents are
directed to jointly and severally, the one paying the other to be
absolved, pay the applicant’s
costs of the application on the
attorney and client scale, such costs to include the costs consequent
on the employment of two
counsel, one being a Senior Counsel.
L R ADAMS
Judge of the High Court
Gauteng Local Division, Johannesburg
HEARD ON:
12
th
January 2021 – in a ‘virtual hearing’
during a videoconference on the
Microsoft Teams
digital
platform
JUDGMENT DATE:
13
th
January 2021 – judgment handed down
electronically
FOR THE APPLICANT:
Adv R Stockwell SC, together with Advocate I L Posthumus
INSTRUCTED BY:
Whalley & Van der Lith Inc, Randburg
FOR THE FIRST, THIRD, FOURTH & FIFTH RESPONDENTS:
Adv E Theron SC
INSTRUCTED BY:
Mashabane Liebenberg Sebola Incorporated, Roodepoort
FOR THE SECOND RESPONDENT:
No appearance
INSTRUCTED BY:
No appearance