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[2021] ZAGPJHC 545
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Advanced Valves CC v Electrolux South Africa (Pty) Limited and Others (20/18686) [2021] ZAGPJHC 545 (6 October 2021)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
LOCAL DIVISION, JOHANNESBURG)
CASE
NO: 20/18686
Reportable:
NO
Of
interest to other judges: NO
Revised
06/10/2021
In
the matter between:
ADVANCED
VALVES
CC
Applicant
and
ELECTROLUX
SOUTH AFRICA (PTY) LIMITED
First Respondent
THE
SOUTH AFRICAN BUREAU OF STANDARDS
Second Respondent
THE
NATIONAL REGULATORY COUNCIL FOR
COMPULSORY
SPECIFICATIONS
Third Respondent
Delivery:
This judgment is handed down
electronically by circulation to the parties' legal representatives
through email and released to the
court's library. The date for
hand-down is deemed to be 05 October 2021.
Summary:
Application
to invoke the provisions of Rule 35 (13) read with Rule 35 (14) of
the Uniform Rules of the High Court. Application
of the discovery
rules to motion proceedings.
JUDGEMENT
Molahlehi
J
Introduction
[1]
The issue for
determination in this interlocutory application is whether the court
should permit the applicant's request to invoke
the provisions of
rule 35 (13) of the Uniform Rules of the High Court (the Rules). In
other words, the applicant’s request
is that the court should
allow the rules relating to discovery to find application in the main
application instituted by the applicant,
Advance Valves CC, against
the first respondent Electrolux South Africa (Pty) Limited
(Electrolux).
[2]
The other
relief sought by the applicant is that if successful in its request,
then the court should order the second respondent,
the South African
Bureau of Standards (SABS), to make available for inspection and
copying in terms of rule 35 (14) of the Rules
a report concerning the
products of the Electrolux.
[3]
The applicant
contends that the findings in the said report are related to the
complaint it had lodged with the SABS and are thus
relevant to the
main application which it had instituted against the respondent.
[4]
The applicant
of avers that it became aware of the existence of the SABS report and
findings through the correspondence dated 23
October 2020 from the
SABS.
[5]
The Electrolux
opposed the application mainly because, according to it, the
requested report is irrelevant to the determination
of the dispute in
the main application.
The
parties
[6]
The applicant
is a closed corporation with limited liability and incorporated in
terms of the close corporation laws of the Republic
of South Africa.
[7]
Electrolux is
a private company registered in terms of the company laws of the
Republic of South Africa. It is a division of an
international
company, Electrolux AB, a Swedish global home appliance manufacturer
in Stockholm, Sweden.
[8]
The
SABS and the National Regulatory for Compulsory Specification are
statutory bodies established respectively in terms of the
Standards
Act,
[1]
(the Standards Act) and
the National Regulator for Compulsory Specifications Act,
[2]
(the NRCS Act).
[9]
The NCRS is,
in terms of the NCRS Act, charged with determining compulsory
specifications for the safe storage of water in the water
heaters. In
terms of section 13 of the NRCS Act, the NCRS is responsible for the
following:
a.
making recommendations to the Minister of Trade Industry to declare a
SANS compulsory specification of a product.
b.
issuing a letter of authority to permit the sale of goods falling
within the ambit of a particular compulsory specification.
c.
monitoring compliance with the NRCS Act by role players in the
industry.
[10]
In terms of
the NRCS Act, businesses are prohibited from importing, selling or
supplying a product to which the compulsory specification
applies
unless that product complies with the mandatory specification.
[11]
The applicant
and Electrolux are competitors in the market of the sale of water
heaters and the parts thereof.
History
of the litigation
[12]
The
application in this matter was instituted as an urgent application on
31 July 2020, and it was struck off the roll for lack
of urgency on
25 August 2020. After that, the applicant re-enrolled the matter on
the ordinary roll for a hearing on 27 October
2020.
[13]
A
day before the hearing date, namely 28 October 2020, the applicant
filed a supplementary affidavit indicating that it requires
the
discovery of the SABS October report before the main application
could be heard. This resulted in the postponement of the hearing
with
the applicant granted leave to institute the current application.
[14]
The
papers in the current application were filed between December 2020
and January 2021.
The
case of the applicant.
[15]
The applicant
seeks a final interdict based on the allegation that the respondent
does not have the necessary permits to sell the
regulated goods.
[16]
The
application to compel discovery is related to the proceedings
instituted by the applicant (the main application) concerning
the
first respondent's alleged unlawful and illegal competition.
[17]
The alleged
unlawful and illegal competition in the main application concern the
following allegations by the applicant:
(a)
The respondent
does not have permits issued in its name, which entitled it to affix
the SABS approved mark on its drain cork, temperature
and pressure
safety valves (T&P valves).
(b)
The
respondent’s T & P valves and drain cork, did not comply
with the relevant South African National Standards (SANS)
and was not
eligible to affix the SABS mark to its products.
[18]
The above
complaint arose from purchasing the Kwikot branded temperature and
pressure of the T & P valves and the branded drain
cocks from a
spares retailer, Plumblink.
[19]
The T & P
valve's purpose is to ensure safety in the regulation of excessive
water pressure in the electric water heater and
to avoid any possible
explosion of the water heater.
[20]
The
applicant's conclusion that it is entitled to call for the discovery
as envisaged above arises from the letter of the SABS to
it dated 23
October 2020 where in the last paragraph thereof the following is
stated:
"The
SABS has conducted an investigation, the conclusion of which will be
informed by the general permit conditions between
SABS and
Electrolux. Our findings were communicated to Electrolux for action."
[21]
On 26 October
2020, the applicant's attorneys addressed a letter to SABS's
attorneys requesting that it make available a copy of
the findings
alluded to in the letter of 23 October 2020.
[22]
The applicant
further interprets the letter's contents to say that SABS must have
committed some form of transgression. It is based
on this that it
contends that the report is relevant to the main application. The
relevant part of the letter reads as follows:
"It
is abundantly clear that your client must have transgressed on one or
more of the grounds contained in our client's application
(as there
were the grounds which informed the complaint to the SABS). The
report and findings are highly relevant to the issues
before the
Court and, as such, we request that you provide us with a copy
thereof forthwith."
[23]
The SABS never
responded to the request for the report's release, and thus the
applicant instituted this application.
[24]
In its
supplementary affidavit, the applicant alleges that an employee of
SABS informed it that the respondent's drain cork and
T & P
valves were non-compliant and impermissibly embossed with the SABS
mark. It further contends that the SABS’s findings
are
inextricably linked to the reports relied on by Electrolux as part of
its defence.
The
respondent's case
[25]
The
respondent's case is that the test conducted by the SABS and its
findings in the report are applicable as of May 2020 reveal
that the
valve, the drain cork and the vacuum breaker were compliant with the
SANS standard and accordingly certified as such.
The respondent
further contends that there has been no subsequent decision by SABS.
[26]
It is on the
basis of the above that the respondent contends that:
a.
The documents
sought by the applicant have no bearing on the factual or legal
position as of May 2020.
b.
The
relationship between it and SABS is contractual, and in terms of the
contract, the respondent is allowed to use the license
issued to it
by SABS. As a third party to the contractual relationship, the
applicant has no interest in the issue of the license
granted by
SABS.
c.
The Electrolux
contends further that the SABS's employee's evidence is unreliable
and prejudicial as it is based on hearsay. It
may also constitute a
breach of the confidentiality rule of the employee's employment
contract.
Legal
principles
[27]
The
broad principles governing the approach to discovery in application
matters are set out in First Rand Bank Ltd t/a West Bank
v Manhattan
Operations (Pty) and Others,
[3]
as follows:
"The
authorities are in agreement that, in general, discovery does not
apply in application proceedings as a matter of course…"
[28]
The
court further in that case quoted with approval, what was said in
Moulded Components and Routoumolding South Africa (Pty) Ltd
and
another,
[4]
where the court
said:
"In
application proceedings, we know that discovery is a very rare and
unusual procedure to be used and have no doubt that
is a sound
practice and it is in exceptional circumstances, in my view, the
discovery should be ordered in application proceedings."
[29]
It
is trite that the court has a very wide discretion to order discovery
in application proceedings. It will do so where it is persuaded
that
it is in the interest of justice to grant permission for
discovery.
[5]
To avoid a
compelling order of discovery, the respondent in an application such
as the present must show that the document requested
is irrelevant to
the issues at hand or privileged.
[6]
[30]
In
Premier Freight v Breathtex,
[7]
the court identified two aspects relating to the notion of
exceptional circumstances that may require permission for discovery
in a motion proceeding as being:
a.
it is rare
that a litigant would seek a compelling order of discovery in
application proceedings.
b.
there must be
special features that render the application of the rules of
discovery applicable to application proceedings.
[31]
The court
further opined that the notion of exceptional circumstances has to be
seen in the context of the Constitutional values
of fairness, equity,
openness and transparency. Moulded Components (Supra)
[32]
In the heads
of argument, the applicant submits that it seeks to invoke rule 35
(13) not on the grounds of seeking general discovery.
[33]
In my view,
this matter turns on whether the issue of the requested discovery is
relevant. As the above discussion shows, the October
report was
issued several months after the sale of the products in question by
Electrolux in May 2020. There is no dispute that
the SABS had issued
certificates and permits after conducting the tests on the products.
In the circumstances, this renders the
sales of the products to be
compliant with the required standard.
[34]
The contention
of the applicant that the report may say that the certificates were
incorrectly issued and thus Electrolux must take
corrective action
does not assist the applicant's case. As stated earlier, the
discovery application was issued in October 2020
when the sale of the
products in question was in May 2021. This means that even if the
October report was to say that the certificate
of permits at the time
of the sale was incorrect, that would have no bearing on the
lawfulness of the sale. The legality or otherwise
of the sale would
turn based on the certificate or permits that existed at the time. I
am thus in agreement with the submission
by Electrolux that the
legality or otherwise of the sale must be determined as at the date
of the sale.
[35]
In the
circumstances, I find the October report to be irrelevant and thus
the applicant’s application stands to fail
Order
[36]
In the
circumstances, the applicant's application is dismissed with costs.
E
Molahlehi
Judge
of the High Court
Gauteng
Local Division,
Johannesburg
Representation:
For
the Applicant:
Adv G Kairinos SC with Adv R
Pottas
Instructed
by: Smit and Herbst Attorneys
For
the Respondent: Adv G Marriot
Instructed
by: Adams and Adams Attorneys.
Heard:
29 July 2021
Delivered:
6 October 2021
[1]
Act
number
8
of 2008.
[2]
Act
number
5
of 2008.
[3]
2015
(5) SA 238
[GCJ].
[4]
1979
(2) SA 457
(W) at 470D – E.
[5]
Pensionfonds
v Smith
[1993] ZASCA 47:
[1993 [3] SA459 [A at 467B – D.
[6]
See
Center for Child Law, the Government Employee Hoer Skool Fotchville
and another
(2015) 4 ALL SA 571
at 582.
[7]
[20301/02)]
[2003] ZAECOHC 10 (10 March 2003).