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[2016] ZAFSHC 17
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Neuro Learning Link v Biolink (Pty) Ltd and Another (4830/2015) [2016] ZAFSHC 17 (11 February 2016)
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Certain
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IN THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION: BLOEMFONTEIN
Case
No.: 4830/2015
In the
matter between:-
NEURO
LEARNING LINK
Applicant
and
BIOLINK
(PTY) LTD
1
st
Respondent
(Registration
number: 2012/134712/07)
HENDRIK
GIDEON VISSER
2
nd
Respondent
(ID
number: [.....])
CORAM:
DAFFUE,
J
JUDGMENT BY:
DAFFUE,
J
HEARD ON:
28
JANUARY 2016
DELIVERED ON:
11
FEBRUARY 2016
I
INTRODUCTION
[1]
Central to the dispute between the parties is a software programme
known as BioWiz, developed by Mr Andries Jakobus Mouton (“Mouton”)
with the sole purpose to provide neurotherapy to children and adults
who suffer from learning and concentration disabilities.
Respondents’ right to be in possession of and/or to use a
License File Generator (herein later referred to as a “LFG”),
a software utility programme that enables one to install the BioWiz
software programme (“BioWiz”) on one’s computer
and
which has been created with the sole purpose to protect BioWiz
against unlawful copying as it is password protected, is seriously
contested in the application and needs to be adjudicated by the
court.
II
THE PARTIES
[2]
Applicant is Neuro Learning Link, a sole proprietorship of which
Mouton is the sole proprietor. I shall refer to Mouton
as
applicant in this judgment.
[3]
First respondent is Biolink (Pty) Ltd. Second respondent, Mr
Hendrik Gideon Visser, an associate professor in chemistry
at the
University of the Free State, is the sole director of first
respondent.
III
THE RELIEF
CLAIMED
[4]
Ex facie
the notice motion applicant seeks the following relief which is
quoted
verbatim
:
“
1.
An order compelling the Respondent to destroy the License File
Generator from his personal computer or
any other copy he might have
of the license file generator to the software program BioWiz;
2. That the First and/or Second
Respondent be compelled to provide a full detailed list of all of
the
First and Second Respondent’s agents who was provided with the
license filed generator including:
2.1 Their names;
2.2 The area that they are operating their
business;
2.3 A full description of their business addresses;
3. Interdicting the Respondent, either
personally or through an agent or employee, from installing
and
distributing any copies of the software program BioWiz;
4. An order compelling the Respondent,
either personally or through an agent or employee to remove
/ delete
any BioWiz software program(s) which was/were installed on any of his
or any of Biolink agents’ computer(s) after
21 April 2015.
5. An order compelling the Respondent
to supply the above honourable court with a sworn affidavit
that he
complied with prayer 1 herein above;
6.
That the Respondent pays the costs of this application;”
IV
FINAL
INTERDICT
[5]
The nature of the remedy is that of a final and permanent interdict.
In prayers 1, 2, 4 and 5 of the notice of motion
applicant seeks
mandatory relief in terms whereof the performance of certain action
is required and in prayer 3 a prohibitory interdict
is sought.
However it is uncertain against which respondent relief is sought in
prayers 1, 3, 4, 5 and 6. Interdict
procedure is a remedy of a
summary and extra-ordinary nature, allowed in cases where a person
requires protection against an unlawful
interference or threatened
interference with his or her rights. It is not a remedy for
past invasion of rights, but is concerned
with the present or the
future. See LAWSA, vol 11, para [390].
[6]
The requisites for the grant of a final interdict have been set out a
century ago in
Setlogelo v Setlogelo
1914 AD 221
, at
227 a judgment which has been quoted with approval on a regular
basis. The three requisites for a final interdict, all
of which
must be alleged and proven, are:
i. a clear right on the part of
the applicant;
ii. an injury actually committed
or reasonably apprehended;
iii. the absence of any other
satisfactory remedy available to the applicant.
I
shall consider the aforesaid requirements in more detail
infra
when I evaluate the evidence
.
V
ADJUDICATION
OF OPPOSED MOTIONS
[7]
In motion proceedings the affidavits constitute both the pleadings
and the evidence and the issues and averments in support
of the
parties’ cases should appear clearly therefrom. See
Minister of Land
Affairs and Agriculture v D & F Wevell Trust
2008 (2) SA 184
(SCA) at 200D.
[8]
It is trite that the applicant in application proceedings must make
out his/her case in the founding affidavit. A litigant
should
not be allowed to try and make out a case in the replying affidavit.
The founding affidavit must contain sufficient
facts in itself upon
which a court may find in the applicant’s favour. An
applicant must stand or fall by his/her founding
affidavit. See
Director of
Hospital Services v Mistry
1979 (1) SA 626
(AD) at 635H – 636D. Fresh allegations
cannot be made in the replying affidavit. Allegations in an
applicant’s
replying affidavit which should have appeared in
the founding affidavit or which are irrelevant and would gravely
prejudice the
respondent may be struck out and/or disregarded.
It is not sufficient to prepare a skeleton of a case in the founding
affidavit
and then to add flesh in the replying affidavit. See
Titty’s Bar
and Bottle Store (Pty) Ltd v ABC Garage and Others
1974 (4) SA 362
(TPD) at 369A and further.
[9]
A court should adjudicate factual disputes in application procedure
having regard to the well-known
Plascon-Evans
Paints
dicta
recently approved and considered in more depth in
Wightman
t/a JW Construction v Headfour (Pty) Ltd and Another
[2008] ZASCA 6
;
2008 (3) SA 371
(SCA). I quote from para [12]:
“
[12]
Recognising that the truth almost always lies beyond mere linguistic
determination the courts have
said that an applicant who seeks final
relief on motion must in the event of conflict, accept the version
set up by his opponent
unless the latter’s allegations are, in
the opinion of the court, not such as to raise a real, genuine or
bona fide dispute
of fact or are so far-fetched or clearly untenable
that the court is justified in rejecting them merely on the papers:
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984 (3) SA
623
(A) at 634E-635C. See also the analysis by Davis J in
Ripoll-Dausa v Middleton NO
[2005] ZAWCHC 6
;
2005 (3) SA 141
(C) at 151A-153C with
which I respectfully agree.”
VI
MATERIAL
UNDISPUTED FACTUAL BACKGROUND
[10]
During the course of 2013 and 2014 applicant created BioWiz for the
sole purpose to provide neurotherapy to children and adults
with
learning and concentration disabilities.
[11]
BioWiz was created together with the application specific software
utility programme, LFG, to protect BioWiz against unlawful
copying,
it being password protected. BioWiz cannot be installed without
the LFG and it is impossible to run BioWiz without
applying the LFG.
[12]
First respondent is a company that also provides neorotherapy to
people to teach them how to learn to concentrate by using
computer
based programmes. It has agents nationwide and a few
internationally who provide these services to the public.
[13]
Applicant saw a mutual beneficial opportunity for BioWiz to
compliment the business of first respondent. Thereupon he
approached second respondent and this led to a verbal agreement being
entered into between applicant and first respondent, represented
by
second respondent.
[14]
The minutes of the meeting during which the verbal agreement was
entered into between the two gentlemen is annexed to the founding
affidavit, but the parties agreed that the contents thereof do not
encapsulate the full agreement between them. I do not
intent to
deal extensively with any of the terms and conditions of the
agreement; however certain terms will be specifically mentioned
when
I evaluate the evidence.
[15]
Second respondent was allowed to do the initial installation for
first respondent’s agents by making use of the LFG which
was
provided by applicant to second respondent via drop box they both
shared. Second respondent received R300,00 for each
installation and applicant received R1 700,00 for each copy of
the BioWiz installed.
[16]
Since 21 April 2015 no further sales of BioWiz to agents of first
respondent occurred and first respondent did not do any new
installations of BioWiz since this date. This last aspect is
not common cause, but respondents’ version cannot be rejected
as false.
[17]
On 23 April 2015 applicant’s attorneys wrote a letter to second
respondent, terminating the agreement between the applicant
and first
respondent with immediate effect, but subject to several conditions.
The last sentence of the letter reads as follows:
“
Ons
vertrou u vind bogenoemde in orde en ontvang graag u terugvoer
hierin.”
On 30
April 2015 respondents responded through their attorneys, indicating
that a formal settlement agreement should be prepared
and
simultaneously making counter proposals. Finally applicant’s
attorneys were requested to provide respondents’
attorneys with
a draft settlement agreement for consideration. Applicant
relies on these two letters as proof of consensual
cancellation of
the agreement and states in paragraph 19.1 of the founding affidavit
“….
that we agreed to
cancellation of the agreement between us …
”
and
continues in paragraph 19.3 as follows:
“
The
agreement was then formally terminated on or about 23 April 2015, in
that termination of the agreement was offered and accepted
by the
first respondent.”
VII
DISPUTED FACTS
[18]
The facts contained under the previous heading are undisputed, save
for the one aspect referred to, but the following are in
dispute:
1.
That the agreement
between the parties has been cancelled by agreement as alleged.
2.
Whether or not
applicant is entitled to rely on cancellation by notice which will be
addressed briefly although this is not the
case that respondents were
called upon to meet.
3.
Whether or not
respondents have a legal right to possession of the LFG;
4.
Whether or not
applicant is entitled to the further relief claimed in the notice of
motion.
VIII
EVALUATION OF
THE EVIDENCE IN LIGHT OF THE LEGAL PRINCIPLES AND SUBMISSIONS BY
COUNSEL
[19]
I regard it convenient to evaluate the evidence based on the
requirements for final interdicts and such evidence will be
considered
under the relevant headings.
Clear
right
[20]
LAWSA loc cit at para [397] deals with proof of a clear right as
follows: “
Whether an applicant
has a right is a matter of substantive law. Whether that right
is clear is a matter of evidence.
In order therefore to
establish a clear right the applicant has to prove on a balance of
probabilities facts which in terms of
substantive law establish the
right relied upon.
”
[21]
Insofar as applicant seeks a final interdict he has to prove an
unlawful state of affairs and the right to secure a permanent
cessation thereof. In saying this, an interdict is not a remedy
for the past invasion of rights, but is concerned with present
or
future infringements.
[22]
It is applicant’s case that respondents are not entitled to be
in possession of the LFG and therefore this court should
order them
to destroy same. Respondents indicate that first respondent is
entitled to be in possession of the LFG even in
the event of a
finding that the contract between applicant and first respondent has
been cancelled, the reason being that it is
necessarily required to
re-install BioWiz for its agents whose computers might be stolen
and/or become defective and who obtained
the software before 21 April
2015. Applicant’s viewpoint is that such installations
could never be regarded as first
installations, but second
installations and that first respondent was not allowed to do second
installations, especially insofar
as it might be done without the
knowledge of applicant and/or without payment to applicant as agreed
upon when the contract was
concluded.
[23]
As mentioned it is respondents’ case that such re-installations
would only be required in respect of first respondent’s
agents
who purchased BioWiz until 21 April 2015, the date when applicant and
first respondent ceased to do business with each other.
[24]
I have considered the terms and conditions of the contract entered
into between applicant and first respondent, the fact that
the
minutes attached to the papers do not set out the full terms of the
parties’ agreement as confirmed by first respondent
and also
applicant in reply, as well as the background facts. Although I
was initially sceptical about first respondent’s
right to
remain in possession of the LFG even in the case of a finding that
the contract between the applicant and first respondent
had been
cancelled, I have been persuaded, bearing in mind the network of
agents which first respondent has established, that it
cannot be
found that respondents’ version is so far-fetched and untenable
that it should be rejected on the papers.
First respondent
needs the LFG to do re-installations to existing agents who purchased
BioWiz prior to 21 April 2015 in the circumstances
referred to
above.
[25]
Applicant does not rely in the founding affidavit on a notice of
termination of the contract between the parties and/or that
he was
entitled to cancel the contract due to first respondent’s
breach of contract. He clearly tries to make a case
that the
contract has been cancelled by mutual agreement. However, the
two letters relied upon, referred to
supra,
serve as proof to the contrary. When these letters are properly
considered, it is apparent that applicant intended to cancel
the
agreement subject to certain conditions, that first respondent was
prepared to terminate the agreement subject to certain proposals
and
that it invited applicant to prepare a draft settlement agreement for
consideration. Respondents responded with a counter
offer which
has not been accepted.
[26]
Respondents met the case they were called to meet in the founding
affidavit and I am satisfied that notwithstanding applicant’s
viewpoint, no consensual cancellation of the agreement has been
effected.
[27]
Strictly speaking that should be the end of the case as to whether
the contract between the parties is still in existence or
not.
I shall however briefly deal with other submissions made on behalf of
applicant in order to convince me that the contract
had in fact been
terminated. The letter of applicant’s attorneys referred
to
supra
at
first glance gives the impression in paragraph 2 thereof that
applicant cancelled the contract with immediate effect. A
contract for an unspecified duration may be terminated by one of the
parties with reasonable notice. Also, any notice to
cancel or
the actual notice of termination itself must be clear and
unequivocal. See
Kragga
Kamma Estates CC and Another v Flanagan
[1994] ZASCA 137
;
1995 (2) SA 367
(AD) at 375D. For the reasonableness of a
notice of cancellation the reader is referred to
Amalgamated
Beverage Industries Ltd v Rond Vista Wholesalers
2004 (1) SA 538
(SCA) at 545A - E. Reasonableness in this
context should be tested at the time when the notice was given and
the surrounding
circumstances must also be considered.
Sufficient time should be allowed to the other party to regulate its
own affairs.
[28]
I am satisfied that the contract could not have been terminated in
the manner applicant might have intended to do. Firstly,
the
notice was not clear and unambiguous, but secondly, a reasonable time
should have been provided to first respondent to make
the necessary
arrangements within its business environment, considering the extent
of its activities and its agents across the
country that relied on it
for maintenance and support. Bearing in mind the manner in
which applicant approached the litigation,
it was not necessary for
respondents to put facts before the court as to what should be
regarded a reasonable period in the circumstances.
However,
logic dictates that if the nature of the business is considered, a
reasonable notice period would probably be between
three and six
months. Therefore applicant did not convince me that it was
entitled to cancellation on notice.
[29]
It was furthermore intimated by applicant that a tacit cancellation
of the contract occurred based on the facts on record.
First
respondent decided not to purchase any knew BioWiz from applicant
from or about 21 April 2015 and no selling of such software
to its
agents took place since this date and the same applied to new BioWiz
installations. At the present moment respondent
sells only
PlayAttention systems which are based on EEG technology. It is
the sole distributor of this product in South Africa.
BioWiz
will according to first respondent soon be replaced by the
PlayAttention system, but at the present moment the existing
BioWiz
software programmes are still in use by agents and first respondent
is contractually bound to ensure that the necessary
maintenance is
conducted and support provided. Thus, although no new business
is being conducted between the parties since
21 April 2015, I find
that existing business as at 21 April 2015 and the contractual rights
and obligations flowing therefrom have
not been terminated by any
tacit agreement. I refer to the following
dictum
of Corbett JA in
Standard
Bank of SA Ltd & Others v Ocean Commodities Inc and Others
1983 (1) SA 276
(AD) at 292B:
“
In
order to establish a tacit contract it is necessary to show, by a
preponderance of probabilities, unequivocal conduct which is
capable
of no other reasonable interpretation than that the parties intended
to, and did in fact, contract on the terms alleged.
It must be proved
that there was in fact consensus
ad
idem
.”
[30]
In any event and even if I am wrong in respect of any of my findings
supra, I am still satisfied that, bearing in mind the
Plascon-Evans
principles, the matter must be adjudicated upon the version of
respondents together with the version of applicant which has been
accepted by respondents. That being the case, applicant has not
proven a clear right in terms whereof respondent (it is uncertain
which one of the two) shall be ordered to destroy the LFG.
[31]
Applicant also seeks mandatory interdicts in prayers 2 and 4 of the
notice of motion, requiring the court to compel respondents
to
provide a list of all agents who had been provided with a LFG and to
remove or delete any BioWiz software programmes which were
installed
on the computers of first respondent’s agents after 21 April
2015. Applicant has not proven that anyone of
respondents’
agents was provided with a LFG, save for Me Du Plessis in Australia
to which I shall refer hereinafter and/or
that respondents installed
BioWiz on its agents’ computers after 21 April 2015. In
fact this is clearly respondents’
case that they never provided
the agents with LFG’s (save for Me Du Plessis in Australia),
and furthermore it is denied that
any BioWiz was installed after 21
April 2015. Respondents did not merely deny applicant’s
entitlement to the relief
claimed, but positively stated their
reasons for such denial. There is no reason to doubt
respondents’ sincerity, bearing
in mind the utilisation of the
PlayAttention system and the circular to agents confirming that first
respondent would not supply
or market any new BioWiz software.
[32]
In prayer 3 of the notice of motion a prohibitory interdict is sought
whereby respondent (it is uncertain which of the two)
is to be
prohibited from installing and distributing any copies of BioWiz.
Again, and for the same reasons mentioned above,
I am satisfied that
applicant has not proved a clear right in this regard.
[33]
Respondents indicate that it was nowhere agreed that applicant would
have sole and exclusive rights of distribution of BioWiz
outside the
borders of South Africa. It is not necessary to make any
finding in this regard in light of the fact that Me
Du Plessis to
whom BioWiz and a LFG were made available, confirmed under oath that
she already destroyed the LFG in 2014.
If applicant was of the
view that first respondent materially breached the contract with him
in this regard, he could and should
have pursued his contractual
remedies and cancelled the contract forthwith. However he
elected not to do so and cannot now
be heard to rely on such alleged
breach of contract for termination of the agreement. He cannot
now change his mind, or put
otherwise:
“
(H)e
cannot both approbate and reprobate.”
See
Thomas v Henry
and Another
1985 (3) SA 889
(AD) at 895J – 896E. This aspect might
have a bearing on the second requirement for final interdicts and I
shall deal
with that
infra
.
An
injury actually committed or reasonably apprehended
[34]
Applicant has produced no evidence to show that respondents
distributed or provided BioWiz to any person or entity since 21
April
2015 or that they attempted to do so. There is also no evidence
that, save for supply of the LFG to Me Du Plessis,
any LFG’s
were supplied to other persons or entities or that respondents
attempted to do so. There is no real likelihood
that
respondents will act in such manner. I am prepared to accept
respondents’ version set out as long ago as 30 April
2015 in
the letter of their attorneys and their undertaking not to distribute
BioWiz any further. Applicant has not proven
the second
requisite for a final interdict.
The
absence of similar protection by any other ordinary remedy
[35]
In the light of the conclusions arrived at in respect of the first
two requisites for final interdicts, it is unnecessary to
consider
the third requisite at all.
IX
CONCLUSION
[36]
Applicant failed to prove the first two requisites for a final
interdict and therefore, the application stands to be dismissed.
There is no reason why costs should not follow the event.
X
ORDER
[37]
Therefore the following order is issued:
1.
The application is
dismissed with costs.
_______________
J.
P. DAFFUE, J
On
behalf of the applicant:
Adv. H. van Zyl
Instructed by:
Hennie Stander Attorneys
BLOEMFONTEIN
On
behalf of the respondents:
Adv. D.
J. van der Walt SC
Instructed by:
Symington & De Kok
BLOEMFONTEIN
/eb