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[2021] ZAGPJHC 502
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Nqanawe Hollding (Pty) Ltd and Another v Innovators Resources (Pty) Ltd (19/2283) [2021] ZAGPJHC 502 (4 October 2021)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
SOUTH
GAUTENG DIVISION, JOHANNESBURG
CASE
NUMBER: 19/2283
REPORTABLE:
YES
OF INTEREST TO OTHER JUDGES: YES
REVISED
4/10/2021
NQANAWE HOLDING (PTY)
LTD
1
st
PLAINTIFF
IR JOINT VENTURE (PTY)
LTD
2
ND
PLAINTIFF
AND
INNOVATORS RESOURCES (PTY)
LTD
1
ST
RESPONDENT
WESCOAL MINING (PTY) LTD
2
ND
RESPONDENT
ARNOT OPCO (PTY)
LTD
3
RD
RESPONDENT
COMMODITY LOGISTIX MANAGERS AFRICA
(PTY) LTD
4
TH
RESPONDENT
MINISTER OF MINERAL RESOURCES, GWEDE
MANTASHE NO. 5
TH
RESPONDENT
JUDGMENT
KEKANA AJ
INTRODUCTION
[1]
This is an exception brought by the first, second and third
defendants in terms of rule 23 of the Uniform Rules of Court. The
defendants except to the plaintiff’s particulars of claim on
the basis that the particulars of claim do not disclose a cause
of
action and / or that they are vague and embarrassing.
FACTS
[2]
The First plaintiff and the Second defendant entered into a
memorandum of agreement and a non- disclosure agreement (NDA). In
terms of the MOU they agreed to (a) jointly pursue a contractual
agreement with other parties to constitute a consortium to draft
a
multi-party agreement and (b) to co-operate in the execution of the
intended transaction and not to circumvent each other. The
NDA
prohibited the parties from disclosing confidential information
obtained from the other party to third parties. Subsequent
to the
conclusion of the MOU and the NDA, the First defendant and the second
defendant concluded a memorandum of agreement (the
Wescoal MOU).
[3]
The basis of the plaintiffs’ claim against the first defendant
is that by entering into the Wescoal MOU, the First defendant
breached the MOU and NDA entered into between and first plaintiff and
the first defendant. For the claim against the second and
the third
defendant the plaintiffs allege that the second and/or the third
defendant owed them a legal duty not to interfere in
a contractual
relationship between the first plaintiff and the first defendant.
THE
PLAINTIFFS’ CLAIM AGAINST THE FIRST AND/OR SECOND AND/OR
DEFENDANT
[4]
The plaintiffs’ claim against the first and/or second and/or
third defendant is for an order: (a) rectifying the MOU;
(b)
declaring that the first defendant has breached the MOU and a NDA;
(c) declaring that the second and/or third defendant have
conducted
themselves unlawfully in that they interfered in a contractual
relationship between the first plaintiff and the First
Defendant;(d)
declaring that the first and/or second and /or third defendant are
liable jointly alternatively severally to make
payment to the first
and/or second plaintiff for such damages suffered by the first and/or
second plaintiff as a result of the
first defendant’s breach of
the memorandum of understanding and/or the non-disclosure agreement
and/or the unlawful wrongful
conduct of the Second and/or third
Defendant mentioned above; (e) that there be an enquiry into the
quantification of the damages
suffered by the first and/or second
plaintiff.
PLEADINGS
[5]
During August 2019 the second and third defendants delivered a notice
in terms of rule 23(1) affording the plaintiff an opportunity
to
remove various causes of complaints. The plaintiffs delivered a
notice to amend its particulars of claim on the 20
th
September 2019 to which there was no objection. The Plaintiffs
delivered their amended particulars on the 17
th
October
2019.
[6]
Subsequent to the delivery of the amended particulars the first,
second and third defendants delivered a further notice in terms
of
rule 23(1) directed at the plaintiff amended particulars of claim. On
the 5
th
February 2020 and the 10
th
March 2020
the first, second and third defendant, respectively delivered their
exception to the amended particulars. The first,
second and third
defendants have raised numerous grounds of exceptions. The plaintiffs
are opposing this application.
LAW
[7] The purpose of an exception is to
protect litigants against claims that are bad in law or against a
serious embarrassment. It
is trite that a party has to plead the
material facts upon which he relies for the conclusion of law he
wishes the Court to draw
from those facts with sufficient clarity and
particularity. The court deciding on an exception must accept all
allegations of fact
made in the particulars of claim as true and may
not have regard to any other extraneous facts or documents. It is not
sufficient
to plead a conclusion of law without pleading the material
facts giving rise to it. The excipient has to satisfy the court that
the conclusion of law for which the Plaintiff contends cannot be
supported on every interpretation that can be put upon the facts.
(Mabaso v Felix1981 (3) SA 865 (A) at 875A-H; Radebe and Others v
Eastern Transvaal Development Board
1988 (2) SA 785
(A) at 792J-793G;
Pretorius and Another v Transport Pension Fund and Others
2019 (2) SA
37
(CC).”
FIRST DEFENDANT’S EXCEPTIONS
First
ground of exception
[8]
The first defendant’s first ground of exception is that the
plaintiff’s allegation that the Second Plaintiff expressly
alternatively by conduct accepted the benefit of the MOU subsequent
to the conclusion of the MOU is stated in the vaguest terms.
It was
submitted that in as far as the second plaintiff relies on an express
acceptance of the benefits of the MOU, the particulars
of claim are
vague and embarrassing. Further that in so far as the plaintiff
relies on a conduct, then the failure to plead the
conduct relied
upon has a consequence that the particulars of claim lack the
averments to support the cause of action or that in
the very least
renders the particulars of claim to be vague and embarrassing.
[9]
According to the defendant the plaintiffs have failed to allege when
the second defendant accepted the benefit, who represented
the
parties when the acceptance was communicated and the conduct that
constituted the acceptance of a benefit.
[10]
The plaintiffs’ submission in this regard is that the question
of when the benefit was accepted, by who and what conduct
constituted
the acceptance amounted to
facta probantia
and can be dealt
with by way of request for trial particulars. The plaintiff argued
that the first defendant failed to show vagueness
amounting to
embarrassment or embarrassment amounting to prejudice or that it will
be unable to plead.
Evaluation
[11]
The relevant part of the particulars of claim to which the complaint
relates reads as follows:
“
24.
Pursuant to the MOU:
24.1 The JV entity
envisaged in terms of the MOU was incorporated being the second
plaintiff.
24.2 The second
plaintiff, subsequent to the conclusion of the MOU, expressly
alternatively by conduct accepted the benefit of the
MOU.
24.3 The second
plaintiff, in the circumstances referred to in paragraphs 24.1 and
24.2 above became a party to the MOU and acquired
rights in terms of
the MOU...
24.4 The first and second
plaintiff complied with all their obligations in terms of the MOU and
NDA”
[12]
The plaintiffs allege that the agreement entered into between the
first plaintiff and the first defendant was entered into
for the
benefit of the second plaintiff. That the second plaintiff became a
party to the contract after it accepted the benefit.
In Crookes NO
and Another v Watson and Others
1956 (1) SA 277
(AD) at p291 B-F
Schreiner JA stated that a contract for the benefit of third party,
appropriately styled, is not only a contract
designed for the benefit
of a third party but a contract between two persons that is designed
to enable a third person to come
in as a party to a contract with one
of the other two parties.
[13]
The basis of the plaintiffs’ claim in this regard is that
second plaintiff became a party to the MOU upon accepting the
benefit. Rule 18(6) of the Uniform rules requires a party relying on
a contract to state when, where and by whom it was concluded.
Therefore, to establish that the second plaintiff became a party to
the MOU, the plaintiffs must state when and where the second
defendant accepted the benefit, how the acceptance was conveyed and
who acted on behalf of the second defendant when the benefit
was
accepted.
[14]
In terms of Rule 18(4) the plaintiffs must establish the facts on
which their claim is based and those facts must be pleaded
with
sufficient particularity to enable the defendants to plead thereto.
In Standard Bank of South Africa Ltd v Hunkydory Inv 194
(Pty) Ltd
(No1) 2010 (1) SA (C) it was stated that whether a pleading is vague
and embarrassing on the ground of lack of particularity
depends on
whether it complies with the relevant Uniform Rules of Court. The
first defendant will suffer prejudice if it will not
be able to
prepare properly to meet the plaintiffs’ case.
[15]
The plaintiffs’ particulars of claim in this regard do not
comply with Rule 18(4) and 18(6). The plaintiffs’ allegation
that the Second Plaintiff “expressly alternatively by conduct
accepted the benefit of the MOU and thus became a party to
the MOU is
stated in such broad terms, as a consequence it lacks sufficient
particularity to enable the First Defendant to plead
thereto. In my
view the plaintiffs’ claim in this regard is vague and
embarrassing and therefore, the exception stands to
be upheld.
Second
to the eighth grounds of exception
[16]
The second to the eighth complaints relates to the allegation by the
plaintiffs that had it not been for the breach of the
MOU and the NDA
by the first defendant, certain transactions would have come to
‘fruition’ and the first and/or the
second plaintiff
would have made a profit therefrom. The essence of the complaints is
that there is uncertainty regarding which
transactions is the
plaintiffs referring to as those that would have come to fruition and
in which way would the plaintiff have
made a profit therefrom. I do
not intend to deal with each cause of complaint separately.
[17]
The relevant parts of the particulars of claim to which the
complaints relate is as follows:
“
17
In terms of the MOU, as rectified, inter alia:
17.1 it was recorded
inter alia that:
17.1.1 the parties wished
to jointly enter into an agreement to formalise their relationship
and terms in the pursuit of a contractual
agreement.
17.1.2 the parties were
in pursuit to establish a joint venture entity (“the JV
entity”) for the purposes of obtaining
a lease for the mining
right at Arnot Mine and an off take agreement from the utility or
other acceptable off take. The JV entity
would be owned by the first
defendant holding 49% and the fourth defendant holding 51%.
17.1.3 The parties agreed
that the first defendant would be the entity to be used for the
purpose of housing the lease for the mining
rights and the operations
would occur in the JV entity.
17.1.4 The parties agreed
that the first defendant would lead the process of obtaining the
lease from Eskom and the requisite off-take
agreement, with
assistance from the consortium.
17.1.5 The parties agree
that the consortium (being the first plaintiff and the fourth
defendant) would be responsible for raising
the funding necessary to
commence mining of the open cast portion covered under the lease. The
first defendant would work together
with the consortium (being the
first plaintiff and the fourth defendant) in ensuring financial
closure was reached.
17.1.6 The parties agreed
to explore the possibility of the transaction to acquire Arnot Mine
outright should the parties so desire.
17.1.7 The parties once
they had fulfilled all obligations and the lease had been approved by
the current owners, would enter into
a formal shareholding structure
in the JV entity.
17.2 the parties agreed
to jointly pursue a contractual agreement with the other parties to
constitute a consortium to draft a multiparty
agreement (clause 1)
17.3 the parties agreed
not to circumvent each other in the process referred to in paragraph
17.2 above and would endeavour to co-operate
as a collective in the
transaction. (clause 2)
17.4 The MOU would be
binding on the parties’ successors, assigns, and affiliates.
(clause 3.4)
17.5 The parties agreed
that the terms of the MOU were confidential and could only be shared
with interested parties after all parties
had agreed in writing.
(clause 3.9)
17.6 The parties agreed
to practice good faith in terms of implementing the terms of
implementing the terms of the MOU. (clause
3.10)”
“
18.
The transactions envisaged in terms of the MOU were:
18.1
the establishment of the joint venture entity for the purpose of
obtaining a lease for the mining right
of Arnot Mine and an off take
agreement from the utility or other acceptable off-take, which joint
venture entity would be owned
by the first plaintiff holding 49% and
the fourth defendant holding 51%;
18.2
the first defendant being the entity to be used for the purpose of
housing the lease for the mining
rights and the operations occurring
in the joint venture entity;
18.3
the first defendant leading the process of obtaining the lease from
Eskom and the requisite off-take
agreement, with the assistance of
the first plaintiff and the fourth defendant;
18.4
the first plaintiff and the fourth defendant being responsible for
raising the funding necessary to
commence mining of the open cast
portion covered under the lease;
18.5
the first defendant working together with the first plaintiff and the
fourth defendant ensuring financial
closure was reached;
18.6 the acquisition of
the Arnot Mine outright; and
18.7 a formal
shareholding structure in the joint venture entity
(“the
envisaged transactions”)”
“
23.
In terms of the NDA inter alia
23.1 …
23.2
All confidential information made available by one party to the other
would be kept secret from third
parties. (clause 3.1)
23.3 No confidential
information could be supplied to a third party without prior written
permission of the other party to the NDA
(clause 3.2)
23.4
….”
“
24.
Pursuant to the MOU:
24.1 The JV entity
envisaged in terms of the MOU was incorporated, being the second
plaintiff.
…”
“
27.
Subsequent to the conclusion of the MOU and the NDA, and to the
exclusion of the first and second plaintiffs
and the fourth
defendant, the First Defendant and the second defendant concluded a
Memorandum of Understanding (“the Wescoal
MOU”)”
“
31.
The conduct of the first defendant in concluding the Wescoal MOU …
constituted a material breach
by the first defendant of:
31.1
the MOU …
…
31.2
the NDA …”
“
32
But for the first defendant’s breach of the MOU and / or the
NDA
32.1 One or more of the
envisaged transaction having come to fruition; and
32.2 Pursuant to one or
more or all of the envisaged transaction having come to fruition, the
first and / or second plaintiff would
have earned profits.”
[18]
The second to the eighth cause of complaint deal with the “envisaged
transactions” which, according to the plaintiff
had there been
no breach of the MOU and the NDA the said transactions would have
come to fruition and the first plaintiff and the
second plaintiff
would have made a profit therefrom.
[19]
The first defendant submitted that the allegation that but for the
first defendant’s breach, one or more of the envisaged
transactions would have come to fruition and that as a result the
first and / or second plaintiff would have earned profits, lack
sufficient particularity to enable the first defendant to plead
thereto. The first defendant contended that it is not clear from
the
particulars of claim as to which transactions is the plaintiffs
relying on, when they would have been entered into, by whom
and on
what terms. Further that the allegation that the plaintiffs would
have made a profit amounts to a conclusion. It is on this
basis that
the first defendant complains that, the particulars of claim lacks
averments necessary to sustain a cause of action
or at the very least
are vague and embarrassing.
[20]
The plaintiffs submitted that they have pleaded a complete cause of
action. They contended that the when, who and on what terms
the lease
for the mining rights at Arnot Mine or the Eskom lease and an
off-take agreement from the utility or other acceptable
off-take
agreement which would have come to fruition and pursuant to which the
first and/or second plaintiff would have earned
profit are a matter
of evidence.
Evaluation
[21]
The basis of the plaintiffs’ claim is that had the defendant
not breached the MOU and the NDA, certain envisioned transactions
would have come to fruition. Further that the first plaintiff and/or
the second plaintiff would have earned profits from those
‘envisioned
transactions’.
[22]
The plaintiffs’ contention was that it is clear from the
amended particulars that the envisaged transaction is “the
establishment of the joint venture entity and the envisaged, i.e.
actual obtaining by the joint venture entity a lease entity for
the
mining rights at Arnot Mine and an off-take agreement from the
utility or other acceptable off-take, and that it was the envisaged
i.e. actual obtaining by the joint venture entity of a lease for the
mining rights at Arnot Mine and an off-take agreement from
the
utility or other acceptable off-take which would have earned profits.
[23]
The question is whether the particulars of claim in this regard has
been phrased in such a way that the first defendant may
be reasonably
and fairly be required to plead thereto. The paragraph dealing with
the transaction from which the plaintiffs allege
that they would have
made a profit in not a model of clarity. However, an exception that a
pleading is vague and embarrassing must
go to the root of the matter
and not only refer to certain paragraphs of the particulars of claim.
The first defendant must show
that the whole cause of action is vague
and embarrassing.
[24]
In Reivelo Leppa Trust v Kritzinger
[2007] 4 All SA 794
(SE) [10]
Jones J stated that: “To make out a cause of action, a
plaintiff must plead that the wrongful conduct caused damage
or if
appropriate it will cause prospective damage, even if only on a
contingency basis, and he or she must quantify the amount
of the
loss. In my view, the plaintiff must positively allege the
prospective harm even if on the facts it can be foreseen only
with a
relatively low degree of probability at the time of the cause of
action has not yet eventuated and may or may not occur
in the future.
Similarly, its quantification at that time must be estimated even
though this may not be easy. When it comes to
proof the court must do
its best to put a figure on the quantum of the prospective loss once
it is proved on a balance of probabilities,
even if the evidence upon
which to quantify it is scant.”
[25]
It is not clear whether the plaintiffs are relying on the
establishment of the joint venture or the obtaining of the mining
rights or the Eskom lease or reaching of financial closure and in
which way would the plaintiffs have made a profit from the said
transaction(s).
[26]
The particulars of claim in this regard do not mention the basis on
which the plaintiffs allege they would have made a profit
from the
envisaged transaction. They simply mentioned what transactions would
have entered into without offering the particulars
of the alleged
transactions from which would they would have made a profit. They
also do not mention the quantum that they are
claiming. In my view
the particulars of claim lacks sufficient particularity to enable the
first defendant to plead thereto.
[27]
It is trite that the object of pleadings is to enable the parties to
come to trial prepared to meet each other’s case
and not be
taken by surprise. The plaintiffs therefore have to plead a complete
cause of action which identifies the issues upon
which they seek to
rely. In this case the plaintiffs’ claim is based on the fact
that certain transactions would have come
to fruition. It is
therefore important that the transactions on which the plaintiffs’
claim is based be clearly identifiable,
further that the loss be
quantified. In my view the cause of action has not been pleaded
lucidly, logically and with precision
to enable the first defendant
to know the case it has to meet. I therefore find that the
particulars of claim in this regard is
vague and embarrassing.
EXCEPTIONS
OF THE SECOND AND THIRD DEFENDANTS
First
ground of exception
[28] First complaint of the second and
the third defendant is based on the allegation by the plaintiffs that
Waheed Sulaiman or
other directors of the second and/or the third
defendant were aware of the second plaintiff, the MOU and the NDA.
The paragraph
to which this complaint relates is phrased as follows:
“
33. At all
material times hereto, the second defendant, in particular Waheed
Sulaiman alternatively one or more of the other directors
of the
second defendant, and/or the third defendant, in particular one or
more of the directors of the third defendant were aware:
33.1 of the Second Plaintiff;
33.2 of the MOU, more particularly:
33.2.1 the envisaged transactions; and
33.2.2 the rights of the first and
second plaintiffs and the obligations of the first defendant in terms
of the MOU.
33.3 that by virtue of the MOU the
first and/ or second plaintiff and / or the fourth defendant and / or
the first defendant might
be exploring one or more or all of the
envisaged transactions;
33.4 of the NDA and the rights of the
first plaintiff and the obligations of the first defendant in terms
of the NDA; and
33.5 that the consequence of the
Wescoal MOU and / or the Sale of the Assets Agreement would be that
one or more or all of the envisaged
transactions would be completely
precluded from coming to fruition and the first and / or second
plaintiff would be completely
deprived of such benefit and that as a
consequence thereof the first and or the second plaintiff would
suffer damages being the
profits that the first and / or the second
plaintiff would have earned had one or more or all of the envisaged
transactions come
to fruition.
(“the Second and / or third
defendants’ knowledge”)”
Their complaint is that the plaintiffs
do not allege who made Waheed Sulaiman and/or other directors aware,
when did he or the other
directors become aware of the MOU and the
NDA and how did he or they become aware of the MOU and the NDA.
[29] The plaintiffs argued that it is
not sufficient for the Second and third defendants to rely on the
fact that the particulars
lack particularity since the remedy
available to the defendants in this regard is to request discovery or
particulars for trial.
[30] The plaintiffs’ claim
against the second and third defendant is based on the allegation
that the defendants interfered
with a contractual relationship
between the plaintiffs and the first defendant. The plaintiffs are
required to plead the material
facts on which their claim is based
and therefore, in so far as the plaintiffs allege that Waheed
Sulaiman became aware of the
MOU and the NDA, they have to allege the
facts relating to that knowledge. I therefore find that the
particulars of claim in this
regard lack sufficient particularity.
The second ground of exception
[31] Second complaint is that the
plaintiffs do not allege that Waheed Sulaiman or other directors of
the second and or third defendant
breached the MOU and /or the NDA
when they became aware of the MOU and the NDA and how the breach
occurred.
[32] The plaintiffs argued that the
cause of action that was pleaded is that the second and third
defendant breached their legal
duty not to interfere in the
contractual relationship between the first and/or second plaintiff
and the first defendant in terms
of the MOU and the first plaintiff
and first defendant in terms of the NDA.
[33] The claim is not based on breach
of the MOU and the NDA by the second and/or third defendant. There is
no allegation that the
second and/or the third defendant were party
to the MOU and the NDA and therefore the allegation that Waheed
Sulaiman or any of
the directors of the First plaintiff breached the
MOU or the NDA is not required for the cause of action pleaded by the
plaintiff.
I therefore find that this cause of complaint cannot
stand.
The third ground of exception
[34] The
second and third defendant’s third cause of complaint is that
the plaintiffs do not mention who acted on behalf of
the first
defendant and gave them sight of the MOU and NDA. They based this
complaint on the allegation by the plaintiffs that
the Second and
third Defendants had sight of the MOU and the NDA which were
disclosed to them by the first defendant. Their contention
in this
regard is that the particulars of claim are accordingly vague and
embarrassing.
Evaluation
[35] The question is whether the
plaintiffs’ allegation that the second and third defendants
were aware of the MOU and/or
the NDA because they were given sight of
the NDA and the MOU by the first defendant is lacking in
particularity. Rule 18(4) requires
the pleader to allege the facts
upon which he relies for his claim with such particularity as to
enable the opposite party to reply
to. There is no exhaustive test to
determine whether a pleading contains sufficient particularity, it
depends on the facts of each
case.
[36] The parties in this matter are
juristic persons, and can only act through natural persons. The
plaintiffs are obviously attributing
the conduct of certain natural
persons to the second and third defendants and must therefore set out
facts that indicate who acted,
when and how to enable the defendants
to respond thereto. The plaintiffs have an obligation to define the
issues so that the defendants
know the case they have to meet. In my
view it is not sufficient to just mention that the second and /or
third defendants were
aware because they were given sight of the MOU
and the NDA without the particular details of that knowledge.
The fourth ground of exception
[37] The
second and third defendants’ fourth cause of complaint is that
in so far as the plaintiffs pleaded that the second
and third
defendants owed them a legal duty not to interfere with the
contractual relationship between the first and/or second
plaintiffs
and the first defendant in terms of the MOU and/or the first
defendant in terms of the NDA, they have failed to allege
what the
source of the legal duty owed to the first and/or second plaintiff
and third defendant is.
[38] The second and third defendant
submitted that a party relying on the breach of a duty must specify
the basis of the duty owed
and must plead the facts from which such
duty arises. Further that it was not enough for the plaintiffs to
just plead that the
second and third defendants had a duty not to
interfere with a contractual relationship as this does not make out a
cause of action.
[39] The plaintiffs argued that they
have pleaded the source of the legal duty which is the fact that the
Waheed Sulaiman alternatively
one or more or other directors of the
second and/or third defendant were aware (a) of the MOU and its
contents, and that by virtue
of the MOU the first plaintiff and/ or
the second plaintiff and/or the first defendant and/or the fourth
defendant might be exploring
one or more or all of the envisaged
transactions; (b) that the consequence of concluding the Wescoal MOU
and/or the Sale of Assets
Agreement would be that the envisaged
transactions would be precluded from coming to fruition depriving the
plaintiffs of a benefit
and consequently the plaintiffs would suffer
damages.
[40] In Law of Delict 7
th
Edition by Neethling et al on page 309-310, it is stated that
knowledge and foreseeability are amongst important factors used by
the courts to determine whether the defendant owed the plaintiff a
legal duty.
[41] In Corronation Brick (Pty) Ltd v
Strachan Construction Co (Pty) Ltd
1982 (4) SA 371
(D) 384 it was
stated that in determining in a given case whether the defendant’s
conduct which resulted in foreseen or foreseeable
economic loss was
unlawful or wrongful the question is whether it would in all
circumstances be reasonable to recognize that defendant
owed the
plaintiff a legal duty. ‘The imposition of the legal duty is a
matter for judicial determination involving a criteria
of public and
legal policy consideration’. (see also Fourway Houlage SA (Pty)
Ltd v SA National Road Agency.
[42] The
plaintiffs’ claim in this regard is based on the fact that they
had entered into a MOU and an NDA with the first
defendant; that the
second and third defendant had a legal duty not to interfere with
that contractual relationship. Consequently,
the plaintiff having
alleged the existence of a legal duty it is for the court to
determine whether such a duty indeed existed.
The facts to determine
whether the second and third defendant owed the legal duty constitute
facta probantia. I therefore find
that the complaint in this regard
cannot be sustained.
The fifth and sixth grounds of
exception
[43] The
fifth cause of complaint is that the plaintiff alleged that the
second and third defendant induced the first defendant
to breach the
MOU and the NDA by concluding the Wescoal MOU but they failed to
allege how the second and third defendants induced
the first
defendant to breach the MOU and the NDA.
[44] The sixth complaint is that is
that the plaintiffs failed to allege who on behalf of the first
defendant was induced by the
second and third defendant to breach the
MOU and/or the NDA.
[45] According to the plaintiffs the
issue of how the second and/or third defendant induced the first
defendant and who on behalf
of the first defendant was induced is a
matter of evidence. They submitted that the second and third
defendants failed to show
(a) vagueness amounting to embarrassment;
(b) that they cannot plead to the particulars; (c) that they will be
unable to prepare
to meet the plaintiffs’ case.
[46] The plaintiffs alleged that the
second and / or third defendants induced the first defendant to
breach the MOU and the NDA
by concluding the Wescoal MOU but they do
not provide details regarding the conduct complained of. Since the
second, third and
the first defendant are juristic persons, the
particulars of the persons who acted on behalf of the first, second
and third defendants
are necessary allegations. The broad allegation
that the second and/or the third defendant induced the first
defendant to breach
the MOU and the NDA does not comply with the
requirements of section 18(4). In my view the particulars of claim in
this regard
lacks sufficient particularity to enable the second and
third defendant to reply thereto.
The seventh ground of exception
[47] The
seventh cause of complaint is that the plaintiffs pleaded that they
have suffered damages of loss of profits as a result
of the first
defendant’s breach of the MOU and/or NDA and/or the second and
third defendants’ unlawful and wrongful
conduct of concluding
the Wescoal MOU and Sale of Assets Agreement; this claim is based on
the possibility or hope that the envisaged
transactions would have
materialised, making the plaintiffs’ claim one for pure
economic loss.
[48] It was submitted that (a) the
plaintiff failed to plead the facts from which it appears that the
Wescoal MOU was not supposed
to have been entered into; (b) they do
not allege or plead the facts that show that Eskom agreed or would
have agreed to lease
the mining rights to the plaintiffs or to enter
into off-take agreements; (c) they do no allege or plead the facts to
show that
they would have obtained funding to commence mining and (d)
they do not plead the facts from which it appears that the conclusion
of the Wescoal MOU caused the plaintiffs not to procure the lease and
off-take agreements with Eskom and to obtain funding. It
is on this
basis that the second and third defendant contend that the claim
lacks the necessary allegations to show that but for
the conclusion
of the Wescoal MOU the plaintiff(s) would have made profits.
[49] The plaintiffs submitted that a
complete cause of action has been pleaded and that the abovementioned
complaints pertain to
evidence and not essential allegations in
regard to the cause of action.
Evaluation
[50] A cause of action exists if all
requirements (facta probanda) are present. The plaintiffs’
claim is to the effect that
but for the Wescoal MOU, the plaintiff
and the first defendant would have obtained a lease of mining rights
from Arnot Mine and/or
secured Eskom lease and/ or entered into
off-take agreement from which they would have made a profit. The
question of whether Eskom
would have agreed to enter into a lease
agreement or any offtake agreement, or whether the parties would have
obtained funding
amongst others are in my view secondary facts to
prove the primary facts.
[51] In my view the particulars
provided in this regards are sufficient. The plaintiffs are not
required to plead ‘every piece
of evidence to prove the fact’.
It cannot be said that on every interpretation, no cause of action is
disclosed. (See McKenzie
v Farmers Co-operative Meat Industries Ltd
1922; Drummond Cable Concepts v Advancenet (Pty) Ltd
2020 (1) SA 546
(GJ)). I am therefore bound to agree with the plaintiffs that the
particulars required by the second and third defendant constitutes
facta probantia. Therefore, this exception cannot be upheld.
The eighth ground of exception
[52] The eighth cause of complaint is
that the plaintiffs do not allege: (a)“ that the parties in
fact agreed to explore the
possibility to acquire Arnot Mine”;
(b) “that or whether the damages that they suffered is profit
that they would have
earned if they acquired a lease for the mining
rights of Arnot Mine and an off-take agreement for utility; (c) “
that and
whether the damages that they have suffered is profit that
they would have made if they acquired Arnot Mine outright”; (d)
“ that the conduct of the second and or third defendant
prevented the parties to the MOU from acquiring Arnot Mine outright”;
(e) “that the second and third defendants were precluded from
concluding the Wescoal MOU and/or the Sale of Assets Agreement”.
[53] The abovementioned complaint is
based on the plaintiffs’ allegation that they have suffered
damages as a result of the
first defendant’s breach of the MOU
and / or NDA, and / or the second and / or third defendant’s
conduct, the damages
being profits that the first and / or second
plaintiff would have earned; Further that the parties to the MOU
agreed to explore
the possibility of a transaction to acquire Arnot
Mine outright should the parties so desire.
[54] The basis of the plaintiffs’
claim is that but for the Wescoal MOU and/or the Sale of Assets
Agreement the plaintiffs
would have made a profit. According to the
plaintiffs they suffered damages because the second and third
defendants interfered
with the contractual relationship between the
Plaintiff(s) and the first defendant.
[55] Plaintiff’s submission is
that the second and third defendants were aware of the second
plaintiff, the MOU together with
its contents, the NDA together with
its contents. Further that the second and third defendants were aware
that the consequence
of the Wescoal MOU and / or the Sale of the
Assets Agreement would be that one or more or all of the envisaged
transactions would
be completely precluded from coming to fruition
and the First and / or Second Plaintiff would be completely deprived
of such benefit
and that as a consequence thereof the First and or
the Second Plaintiff would suffer damages being the profits that the
First and
/ or the Second Plaintiff would have earned had one or more
or all of the envisaged transactions come to fruition.
[56] I do not find that the
allegations in this regard lack the necessary averments to sustain a
cause of action at best I find
that the allegationS are rather vague
and embarrassing.
CONCLUSION
[57] The defendants have succeeded on
most of their grounds of complaints against the plaintiff’s
particulars of claim. Most
of the averments lack sufficient
particularity to enable the first, second and third defendant to
plead thereto.
[58] When the cause of action against
the first defendant is considered, not just specific paragraphs, I
find that they go to the
root of the cause of action. Therefore in so
far as the complaint against the particulars of claim is that they
are vague and embarrassing,
I find that same ought to be upheld.
COSTS
[59] On the issue of costs I find that
the first, second and third defendant were successful on most of
their grounds of exception
and thus are entitled to costs of the
exception
In the results I make the following
order:
1.
The first defendant’s exception is upheld;
2.
The second and third defendant’s exception is upheld;
3.
The plaintiffs are granted leave to amend the particulars of claim
within 15
days of the date of this order;
4.
The plaintiff is ordered to pay the costs of the exception of the
first, second
and third defendant.
P
D KEKANA
ACTING
JUDGE OF THE HIGH COURT
Counsel
for the Plaintiff: L Hollander
Instructed
by Swartz Weil Van Der Merwe Greenberg Inc.
Counsel
for the First Defendant: Ad De Kok Sc
Instructed
by Fasken Inc.
Counsel
for the Second and Third Defendant: Ms Baloyi Sc
Instructed
by Edward Nathan Sonnenbergs
Date
of Hearing: 03 June 2021
Date
of Judgment: 04 October 2021