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[2022] ZAECELLC 16
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Vavika High School and Another v Saunyama and Others (EL166/2022) [2022] ZAECELLC 16 (30 June 2022)
IN
THE HIGH COURT OF SOUTH AFRICA
(EAST
LONDON CIRCUIT LOCAL DIVISION)
CASE
NO. EL 166/2022
NOT
REPORTABLE
In
the matter between:
VAVIKA
HIGH SCHOOL
(Reg.
No. 2020/571161/07)
First
Applicant
MIYOBA
KALINDA
Second
Applicant
and
ROBERT
SAUNYAMA
First
Respondent
CORNELIOUIS
TAFARA MAKANDA
Second Respondent
TENDAI
MAKIWA
Third
Respondent
HILLARY
TOMU
Fourth Respondent
TAFADZWA
MUTANHAURWA
Fifth Respondent
FIRST
NATIONAL BANK
Sixth
Respondent
CIPC
Seventh
Respondent
JUDGMENT
IN RESPECT OF
APPLICATION
UNDER PART A
FOR
INTERIM RELIEF
HARTLE J
[1]
The first applicant is a registered independent
school (“the school”). It is a private company,
bearing the registration
number cited on the face of the notice of
motion and other pleadings filed in the matter. The second
applicant (not indicated
on the face of the notice of motion but
mentioned in the founding affidavit) is alleged to have been the
founder of the first applicant.
He also claims to be its senior
operations employee and a current director of the first applicant.
[2]
It is
both the company and his interests that the second applicant seeks to
protect in an urgent application to interdict the first
to fifth
respondents from appropriating registration and other fees collected
from parents of learners due to the school, and basically
from
running the school or entering its premises to control it, or
interfering with “any member of the applicant”,
pending
the determination of Part B of the application in which the
applicants seek to set aside a sale agreement concluded between
the
“school” (sic) and the first to fifth respondents
pursuant to which the school’s business was sold to them.
The primary premise for the interdict is that the sale is null and
void
ab
initio
because
the sale was supposedly actuated by duress, acts of violence and
coercion, and for this reason, so the second applicant
asserts, the
conduct described above must in protection of their interests
essentially be restrained pending the determination
of the
applicants’ claim to have the agreement set aside.
[1]
[3]
The sixth respondent is cited by reason of the
fact that funds which are the property of the first applicant have
been redirected
to a new account held with the bank at the behest of
the first to fifth respondents, the gains of which the applicants
want this
court to freeze pending the determination of Part B.
[4]
The CIPC is cited as the seventh respondent for
its interest in the proceedings, although for what reason it is not
quite clear.
[5]
No resolution of the first applicant was put up to
show that its “directors” (the first to fifth respondents
claim to
have been substituted as directors since the sale)
authorized the institution of the proceedings or that the second
applicant is
supposedly authorized to represent its interests.
He however claims to have been authorized in a “due and proper
manner”
to depose to the founding affidavit in support of the
relief sought in the application.
[6]
Not surprisingly the first to fifth respondents
filed a notice in terms of rule 7 (1), together with their notice to
oppose, calling
on the second applicant to account for his authority
to represent the first applicant, which is not borne out in any
formal documentation
provided by him.
[7]
The pretext of the application, according to the
second applicant, is that the first to fifth respondents forced him
to sell “the
company” to them because they had not been
able to personally redeem from him their “investments” in
a separate
money lending business called Vavika Trading Academy (of
which he was also the founding director) after that company began to
take
financial strain due to the economic ravages of the COVID
pandemic. (The first to fifth respondents deny lending to
Vavika
Trading Academy, asserting instead that their loans were made
to the second applicant in his personal capacity.)
[8]
This
culminated, so he claims, in him having been ambushed and held
against his will by the first to fifth respondents
[2]
in a dark shady room at a venue at Falcon College in East London on
13 January 2022. Purportedly the first respondent lured
him
there under the false pretence of taking a drive with him which he
says he acceded to because he thought the first respondent
had a
business proposal for him (this despite the claimed animosity between
them as a result of it having supposedly become clear
to the
perpetrators that his lending company could not reimburse their
“investments” in the company.) He alleges
that
after the first respondent snatched his cell phone from him, the
first to fifth respondents demanded their investment shares
from him
personally. His explanation that Vavika Trading Academy was
unable to pay them was not well received and the situation
got
heated. The first respondent suddenly assaulted him on his face
with a closed fist, and repeatedly thereafter.
Thereupon the
first respondent prevailed upon him to sign the sale agreement,
explaining that this would entail him signing over
“ownership”
of the first applicant to them. They insisted, against his
pleas that this was not possible and against
the interests of various
stakeholders, that this was the only way to recover the debt(s) owed
to them, on his version, by Vavika
Trading Company.
[9]
They locked him up in a dark closed room after he
at first refused to sign the document, whereupon he was held captive
until they
showed up again. This weakened his resistance and
fearing what “more” might come, he “decided to
comply
with their directives”. He did so but had no
intention nor desire however to sign over his “ownership”
of the school to the first to fifth respondents.
[10]
His further experience of the situation was
explained in his own words as follows:
“
I
could not endure the assault and being kept captive in a closed a
dark room and awaiting for what I do not know.
[3]
I thought of the worst that could happen to my life.
[4]
My logic dictated that I should succumb to the illegal order to ease
myself from the beatings. I then signed over the
ownership of
the first applicant to the first to the fifth respondents under those
conditions. I have been informed by those
I instructed that
such a contract is therefore concluded under duress. I was only
let go after signing that illegal contract.”
(Sic)
[11]
This resulted in him signing the impugned sale
agreement which he envisages being ultimately set aside by this court
under Part
B of his claim.
[12]
The
purportedly “illegal” sale agreement put up by him on the
face of it appears to be an authentic regular agreement,
typed,
reflecting proper names with ID references, significant dates and
figures and details comprising the necessary elements
of a sale and
acknowledgment of a substantial debt owing which is being set off in
lieu of the sale price of the school as a going
concern. It
bears the second applicant’s signature as seller authorized by
a resolution which was not attached to the
second applicant’s
annexure “VHS 2”, although the sale agreement imports it
by reference as forming part of the
deed of sale. The first to
third and fifth respondents have signed the copy put up by the second
applicant, which the first
respondent in his answering affidavit
concedes he furnished the second applicant with on 8 January 2022
after its signing.
[5]
[13]
The second applicant avers that “immediately
thereafter” he reported the claimed incident to the Fleet
Street Police
Station and that a charge of robbery and assault common
was laid against the first to fifth respondents. Snippets from
the
docket provided by him do not unequivocally indicate his earliest
interaction with the police, although it appears from his own
statement made to them that he only lodged a complaint on 25 January
2022. He further attached the cover pages of the constitutional
warning statements of the alleged perpetrators (the first to third
and fifth respondents) no doubt to paint them as criminals,
but it
appears from a statement deposed to by the investigating officer,
Detective Constable Mzukisi Mja, that the four suspects
implicated by
him co-operated by coming to his office and making warning statements
in which they all denied the allegations against
them. He omitted to
disclose to this court what they alleged in those statements.
[14]
It is further notable from the docket
contents in fact disclosed by the second applicant that he complained
to the police that the
incident happened at 10am on 13 January 2022.
This was no doubt meant to coincide with the document attached to his
founding affidavit
marked “VHS 4” which reflects a
clinical appointment at the Frere Hospital on the same date to give
colour to his allegation
that he had to receive treatment for his
injuries sustained at the hands of the first respondent.
[15]
Also attached (unmarked) is a random “attendance
record” of the Frere Hospital (with no header or identification
of
any patient’s details) under which reference is made to
“J88” opposite a recorded date of 8 January 2022.
[16]
The note attached in support (Annexure “VHS
4”) however indicates that he visited the ENT Clinic at the
Frere Hospital
at
7am
on
13 January 2022. Even if the incident purportedly happened on
the 13
th
,
the time (of the hospital visit) self-evidently precedes the claimed
meeting with four of the respondents at 10am that morning
on his
version during which he was allegedly assaulted, and his rights
violated. In his statement made to the police he put
the
incident at 10am that morning and claimed that he had been held for 7
hours against his will.
[17]
The court was not taken into the second
applicant’s confidence concerning the exact nature of the
injuries sustained by him,
neither why he attached the random
document referencing a J88 without the report itself.
[18]
Be that as it may, this alleged criminal event is
the foundation for his contention that the sale falls to be set aside
and underpins
the relief he intends to pursue under Part B.
[19]
The relief claimed under Part A is interim relief
pending the setting aside of the sale agreement.
[20]
Urgency
(also challenged by the first to fifth respondents because of the
second applicant’s delay in acting on the supposed
coerced
agreement of sale) is premised on the fact that until he can be heard
by the court in respect of Part B, consequences (which
would
otherwise naturally arise after the successful conclusion of a valid
sale agreement) have been flowing from the impugned
sale that are
purportedly compromising the first applicant.
Inter
alia
this
entails the respondents taking the lead at the school and approaching
the Department of Education to “change the details
of the Viva
Trading Academy to themselves” (sic)
[6]
as a prelude to “gain control of the monies or fees paid by
parents to the school account”. This the first to
fifth
respondents have purportedly done by “altering the banking
details of the school into one of their own” and re-directing
the payment of registration and school fees to this new account.
The second applicant further relies on claimed
prejudice to the
learners who are “supposed to benefit from the school”
but are allegedly not because of this coerced
takeover. The
second applicant complains too (but without any substantiation) that
the fees paid by the parents are not being
applied towards the
payment of the school’s rental obligations, possibly resulting
in the school being evicted from its premises.
[21]
The second applicant hangs its case on the premise
of this conduct posing “serious threats not only to the first
applicant
but the children’s future and the Department of
Education” (Sic). It is this conduct that he hopes to
“quell”
by the interim relief sought as well as to
“preserve the status quo”. A complaint is uttered
that unless the
relief is granted the first to fifth respondents will
“squander” the funds which “may cause pandemonium
between
the parents and (himself)”. Also expressed is the
fear that unless the first to fifth respondents are restrained from
their machinations in this respect, they will succeed in their plan,
which is “not to operate the school but to suck as much
money
as they could get until their debt is paid in full”.
[22]
Far from accepting that they are up to no good
and/or do not have the interests of the school, its learners, and
parents at heart,
the first to fifth respondents explain that the
first applicant needed rescuing from the second applicant (a close
friend and business
associate of theirs) who is putting the school at
risk because of his dangerous addiction to gambling and his growing
personal
debt to so many which has caused him to give up valuable
assets for next to nothing to other debt collectors.
[23]
They claim quite openly to have consciously
embarked upon an “intervention” to safeguard their
collective interest in
the first applicant. Moreover, they felt
themselves compelled to take over the reins of the school because the
second applicant
was compromising the school and its assets. In
this respect the staff at the school had not been paid for eight
months and
rent had gone unpaid, giving rise to litigation and
property of the first applicant having been attached in execution.
Monies
intended for the school had been put to the second
respondent’s gambling habit rather than for the purposes which
these funds
were being paid.
[24]
According to them the second applicant at a
pre-arranged meeting on 8 January 2022 (which lasted around two hours
only) voluntarily
signed an acknowledgement of debt and agreed with
their proposals for the sale of the school (or the second applicant’s
shares
in the company) to them. A photograph depicting the
second applicant signing the impugned agreement on the date indicated
in the sale document, in a well-lit room and self-evidently not under
any manifestation of duress, was also put up to prove that
nothing
untoward had happened. An independent witness further lent
support in a confirmatory affidavit to the second applicant’s
un-coerced signature of the agreement. The second applicant was
furnished with a signed copy of the agreement pursuant to
his
signing, co-incidentally evidenced by his attachment of it as an
annexure to his own founding affidavit, albeit without reference
to
any resolution signed by him.
[25]
The applicant in effect seeks an interdict to stop
the implementation of the sale agreement pending determination of his
application
under Part B as indicated above on the pretext that he
was a victim of a serious crime perpetrated by the first to fifth
respondents
against him who forced him against his will, under
assault and deprivation of his freedom and liberty, and under threat
of his
life and liberty, to sign over ownership of school to the
first to fifth respondents.
[26]
The clear right which he asserts is his standing
as “director” and “owner” of the first
applicant which
I will assume for present purposes is a residual
right since on his own showing the business was in fact sold to the
first to fifth
respondents, albeit on his version under duress.
The so-called injury to the right is that the first to fifth
respondents
have “successfully gained access (to the school)
and are now owning the company” and stand “to cause
inconvenience
in the smooth running of the school in that school fees
will now be channeled to a different direction (than) school
activities”.
(This is another way of saying -again on his
case, that the farce of sale has been given effect to as if it were a
regular sale
untainted by any criminality.) In respect of the
requirement of absence of “alternative remedy”, the
second applicant
alludes to the fact that the South African Police
service have fobbed off the criminal charges as a civil matter to be
resolved
between the parties on a basis other than a resort to a
criminal prosecution and that unless this court intervenes an illegal
situation
will prevail until he can get redress under Part B
entailing the setting aside of the sale. As for the financial
requirement
of “balance of convenience” the first
applicant amorphously alleges that this “favours the
first
applicant
and there is no greater loss
to be suffered by the respondents due to the granting of the
interdict”.
[27]
The supposed
prima
facie
right and other contentions
highlighted above stand or falls on the pretext that the first to
fifth respondents made themselves
guilty of the violent criminal
conduct relied upon by the second applicant.
[28]
In order to decide whether an applicant for an
interlocutory interdict has
prima facie
established his right the court is
obliged to look at the respondent’s affidavit as well.
[29]
The
approach to be adopted to establish a
prima
facie
right
where there is a dispute of fact was laid down in Webster v
Mitchell
[7]
as follows:
“
[T]he
right to be set up by an applicant for a temporary interdict need not
be shown by a balance of probabilities. If it
is “
prima
facie
established
though open to some doubt” that is enough. …
The
proper manner of approach I consider is to take the facts as set out
by the applicant, together with any facts set out by the
respondent
which the applicant cannot dispute, and to consider whether, having
regard to the inherent probabilities,
[8]
the applicant could on those facts obtain final relief at the
trial. The facts set out in contradiction by the
respondent
should then be considered.
If
serious doubt is thrown upon the case of the applicant he could not
succeed in obtaining temporary relief, for his right,
prima
facie
established,
may only be open to “some doubt”
.
But if there is mere contradiction, or unconvincing explanation, the
matter should be left to trial and the right be protected
in the
meanwhile, subject of course to the respective prejudice in the grant
or refusal of interim relief.”
(Emphasis added.)
[30]
This
test was modified in Gool v Minister of Justice
[9]
as follows:
“
With
the greatest respect, I am of the opinion that the criterion
prescribed in this statement for the first branch of the inquiry
thus
outlined is somewhat too favourably expressed towards the applicant
for an interdict. In my view the criterion on an
applicant’s
own averred or admitted facts its:
Should
(not could) the applicant on those facts obtain final relief at the
trial
.
[10]
Subject to that qualification, I respectfully agree that the approach
outlined in Webster v Mitchell … is the correct
approach for
ordinary interdict applications.”
[31]
In
this instance the first to fifth respondents emphatically deny the
claimed criminal and forceful pretext and have pointed to
peculiar
circumstances, firstly to support their contention that the second
applicant has perverted the truth, secondly to emphasize
that the
sale agreement was not signed under duress, and thirdly to explain
why they claim that the intervention was necessary
in all the
circumstances in their own interests as well as those of the
learners, their parents and of the school.
[11]
The fourth respondent co-incidentally also asserts that she was not
even present whereas the second applicant has indiscriminately
averred in his founding affidavit that she was among the perpetrators
who employed violence against him when the sale agreement
was
concluded.
[32]
Significantly the second applicant has not
refuted any of the respondents’ allegations detailed in the
answering affidavits
which raise serious doubt about the
circumstances under which the second respondent claims the sale was
concluded or the reasons
for it. Mr Skoti who appeared on his behalf
consciously elected to argue the application on the papers as they
were when the matter
was called before me.
[33]
The
case on the second applicant’s own showing was only reported to
the police on 25 January 2022 despite him supposedly being
forced to
sign over his interest in the first applicant on 13 January 2022
already on his version. (The written agreement
of sale put up
by the second applicant however self-evidently suggests that it was
signed on 8 January 2022 an anomaly he did not
try to explain at
all.)
[12]
The claimed
criminal incident which on his version happened at 10am on 13 January
2022 followed his supposed visit to the
hospital allegedly to receive
treatment on that date
at
7am.
[13]
He furnished no
J88 medical report in substantiation of the injuries claimed to have
been sustained by him despite a random
annexure supposedly confirming
such a scenario. Obvious discrepancies exist between his
statement made to the police and
the one made to support his
allegations in the present application. Most notably he failed
to disclose in his founding affidavit
that each of the respondents
denied the charges against them immediately upon being criminally
charged, no doubt seeking to avoid
drawing attention to the serious
dispute of fact between the parties which he must plausibly have
anticipated.
[34]
It appears to me that the second applicant could
hardly succeed on such a doubtful basis to set aside the legal effect
of a sale
of the school’s business to the first to fifth
respondents pending the determination of Part B on the basis of the
claimed
coercion which to my mind seems contrived as were the
criminal charges ostensibly to serve as a belated basis to negate the
fact
that he had agreed voluntarily, though begrudgingly, to hand
over the reins of the school to his friends and associates. The fact
that he co-incidentally owed them money is neither here nor there.
This in itself would not constitute a basis to set aside
the sale.
[35]
I need not consider the other requisites for an
interim interdict in all the circumstances or the respondents’
contention
that no urgency existed. As I said before, the
matter in my view stands or falls on the supposed pretext of the
first to
fifth respondents claimed thuggery which purportedly induced
the second applicant to part with his interest in the first
applicant.
I mention however that the school appears to be
flourishing under the new ownership and that it would be
counter-intuitive and
against the interests of all concerned to keep
its running in limbo, pending the doubtful determination of Part B in
the second
applicant’s favour.
[36]
As for the question of costs, the second applicant
has patently not taken the court into his confidence, has
contradicted himself
and in fact sought to gild the lily, if not to
mislead the court concerning the supposed criminal conduct on the
part of the first
to fifth respondents to gain an advantage by
affording interim relief. To my mind he should be censured for
his conduct by
a punitive costs order. It follows most
logically that no costs order can be made against the first applicant
of which the
first to fifth respondents are directors and
shareholders which did not authorise nor seek the protection of this
court.
[37]
In the result I issue the following order:
1.
The application under Part A for interim relief is
dismissed.
2.
The second applicant is directed to pay the costs
of the application on the scale of attorney and client.
B
HARTLE
JUDGE
OF THE HIGH COURT
DATE
OF HEARING:
10
February 2022
DATE OF
JUDGMENT:
30
June 2022*
*Judgement
delivered by email to the parties on this date.
APPEARANCE
S
:
For
the applicants: Mr.
D Skoti and Mr. L Rusi
instructed
by I
C Clark Inc.,
East London
(ref. Mr. Klaas).
For
the first to fifth respondents: Mr.
F Kunatsagumbo
instructed
by Precious
Muleya Attorneys,
East London
(ref. Ms. Muleya).
For
the sixth & seventh third respondents:
No appearance.
[1]
The
second applicant left the date blank under Part B concerning when
the sale agreement was concluded. In his founding
affidavit he
claimed however that he was coerced on 13 June 2022 to sign over
ownership of the first applicant to the first to
fifth respondents.
On the face of it the sale agreement, put up by the second applicant
himself, is dated 8 June 2022 with
the effective transfer date of
the business being 9 January 2022.
[2]
In
a police statement made by him he only accuses four suspects.
This is consistent with the fourth respondent claiming
in her
answering affidavit that she was not even in the country at the time
of the sale. This is further borne out by the
fact that the
copy of the sale agreement put up by the second applicant (which the
first respondent agrees was given to the second
applicant after the
signing) is not signed by the “fourth purchaser”, who is
also the fourth respondent.
[3]
In
his police statement he claims he was held for 7 hours against his
will but this allegation was not repeated in his founding
affidavit.
[4]
In
his police statement he claimed that the perpetrators threatened to
kill him, a far cry from just feeling like he was at risk
of losing
his life which is what he averred in his founding affidavit.
[5]
It
makes sense on the first to fifth respondents’ version that
the second applicant would have the copy not yet signed by
the
fourth respondent because she was not in the country on the date of
their pre-arranged meeting, but the second applicant’s
case to
the effect that all five respondents coerced him to sign an
agreement on the one single occasion is not borne out from
the copy
put up by him.
[6]
It
appears that the second applicant meant to refer here to the first
applicant.
[7]
1948
(1) SA 1186
W at 1189.
[8]
And
in the ultimate onus (Godhold v Tomson
1970 (1) SA 61
(D) at 63C-D).
[9]
1955
(2) SA 682
(C) at 688 D – E.
[10]
Author’s
italics.
[11]
For
example, a transcript of the first respondent’s WhatsApp
conversation with the second applicant evidencing an arrangement
to
give the latter a lift to the venue where the sale agreement was
signed on 8 January just before the pre-arranged meeting
time at
10am,a photograph of the second applicant signing the agreement
without any manifestation of duress, CCMA referrals by
staff of the
school preceding the sale complaining that the second applicant was
not paying their salaries despites promises
to them to do so and
proof of the second applicant giving substantial assets as
collateral for loans at huge interest rates.
The respondents have
also put-up copies of minutes of meetings and transactions of the
school reflecting that they had naturally
gone about the business of
the school as its new owners and of having to have taken steps
against the second applicant to interdict
him, under the provisions
of section 2 (1) of the Protection from Harassment Act, 2011, from
perpetrating hooliganism at the
school and intimidating and
harassing its staff and learners. Also, quite significant is proof
that he managed to persuade a
parent to pay school fees to a
“temporal account” after the date of transfer in the
name of Silver Solutions 956
CC. Even on his own version, he would
have no business diverting monies owed to the school into the
account of another entity.
[12]
The
impression is gleaned that he contrived to bring the date closer to
the date of the launch of the urgent application so that
he would
not have to explain why he did nothing to vindicate his complaint of
coercion from 8 January 2022 until that date.
[13]
On
his version in his police statement, he would only have been
released from the venue at 5pm after been held for 7 hours.
Conversely, if he had reported to the Frere Hospital that morning he
would unlikely have been at a venue across town by 10am. Indeed,
in
his police statement he said that he was coming from his brother
that morning before he was waylaid by the first respondent.