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[2015] ZAGPPHC 329
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JRMM Technologies (Pty) Ltd and Another v Ball and Another (8595/2015) [2015] ZAGPPHC 329 (12 May 2015)
IN
THE GAUTENG DIVISION, PRETORIA
(REPUBLIC
OF SOUTH AFRICA)
CASE NO:
8595/2015
DATE: 12 MAY 2015
NOT REPORTABLE
NOT OF INTEREST
TO OTHER JUDGES
In the matter
between:
JRMM TECHNOLOGIES
(PTY)
LTD
...............................................................................
1
st
APPLICANT
MICHAEL JOHN
PRINSLOO
............................................................................................
2
nd
APPLICANT
And
ROBIN DOUGLAS
BALL
................................................................................................
1
st
RESPONDENT
JEFFREY
MORGAN
........................................................................................................
2
nd
RESPONDENT
JUDGMENT
MSIMEKI J:
INTRODUCTION
[1] The applicants,
in this application, seek an order as follows:
“
1.
That the forms and service provided in the Uniform Rules of Court be
dispensed with in terms of Rule 6 (12) and that the application
be
enrolled and adjudicated as an urgent applicant (sic);
2. That the First
and Second Respondents be interdicted and restrained from:
2.1 Divulging to
anyone any of the First Applicant’s confidential information
and/or trade secrets, which include but is not
limited to the
identity and contact details of the First Applicant’s
customers, suppliers, service providers, agents, equipment
sourcing
costs, price lists, and pricing structures and the identities of any
of the First Applicant’s trade connections;
2.2 Using any of the
confidential information and/or trade secrets of the First Applicant
as set out in prayer 2.1 hereinabove either
directly or indirectly in
any way whatsoever, including for the purposes of canvassing the
First Applicant’s customers, suppliers,
service providers,
and/or trade connections or soliciting the business of the First
Applicant’s customers, suppliers, service
providers, agents
and/or trade connection;
2.3 Soliciting or
seeking any business whatsoever from any person, firm or company who
was a customer or trade connection of the
First Applicant during the
First and Second Respondents’ period of employment with the
First Applicant;
2.4 Passing off
their business as that of the First Applicant and/or being associated
with the First Applicant, and/or as representing
the First Applicant,
and/or as being connected in the course of trade with the First
Applicant, and/or using the First Applicant’s
name and/or
get-up or any name and/or get-up which is confusingly or deceptively
similar to the First Applicant’s distinctive
name and/or
get-up;
3. That the First
and Second Respondents be ordered to hand over to the First Applicant
all of the soft and/or hard copies of documentation
containing
information relating to the identity and/or contact details of the
First Applicant’s customs and/or suppliers,
and/or service
providers, and/or agents and/or equipment sourcing costs and/or price
lists and/or pricing structures and/or trade
connections within two
days from date of this order;
4. That the First
and Second Respondents be ordered to hand over to the First Applicant
all assets and equipment of the First Applicant
in the possession
and/or control of the First and/or Second Respondents, including all
Integra Intelligent Motor Controllers, demonstration
units,
measurement equipment and sellable units, within two days from the
date of this order;
5. That the First
and Second Respondents be ordered to pay the costs of this
application on a scale as between attorney and client,
only in the
event of First and/or Second Respondents opposing any of the relief
sought herein.
6. In the
alternative to prayer 2 to 5 above:
6.1 That interim
relief with immediate effect be granted in favour of the Applicants
against the First and Second Respondents in
terms of prayers 2 to 4
above, pending the outcome of this application and/or pending the
outcome of final relief sought by the
Applicants against the First
and Second Respondents in an action to be instituted by the
Applicants against First and Second Respondents
within 30 days from
the date of this order;
6.2 That the First
and Second Respondents show cause on a return date to be determined
by this Court why the interim relief should
not be made final and why
First and Second Respondents should not be ordered to pay the costs
of this application on a scale as
between attorney and client, which
costs order will be sought against the First and Second Respondents
only in the event of any
one or more of them opposing any of the
relief sought herein.
7. Further and/or
alternative relief as may be required to be awarded to the
Applicants.”
[2] Adv P A
Swanepoel (Mr Swanepoel) (assisted by Adv C A Boonzaier) and Adv R J
Groenewald, (Mr Groenewald) respectively, represented
the applicants
and the respondents when the matter was heard.
BRIEF FACTS
[3] The applicants’
version is that the deponent to the founding affidavit, Mr Michael
John Prinsloo (Mr Prinsloo Junior),
Prinsloo senior and the
respondents agreed to start a business. The respondents, at this
stage, do not include Prinsloo Junior
as one of those who attended
the meeting. This, according to the respondents, was during or about
February 2014 whereas according
to the applicants, this happened
during January and February 2014. Up to here, the parties agree. The
purpose of the business was
to import and distribute Integra
Intelligent Motor Controllers (Integra Controllers) which calibrate
and control rock crusher units
in mining operations. On 18 February
2014 the parties agreed that a shelf company had to be bought to
speed up the process of registration
and to commence with the
business as soon as possible. A shelf company called Kerlister (Pty)
Ltd was purchased. The name, in due
course, would be changed to JRMM
Technologies (Pty) Ltd. JRMM represents the parties’ names
which are Jeff, Robin, Mike and
Michael. The shareholding would be as
follows:
The first and second
respondents would be allocated 25% each of the shares while the
second applicant would be allocated 50%. Prinsloo
senior would be the
funder. The first respondent would be responsible for the marketing
division while the second respondent would
be in charge of sales.
Prinsloo Junior and the two respondents were to be the directors. The
collection of the shelf company from
Mr Marc Lindsay (Lindsay), a
business associate of Prinsloo senior, according to the applicants,
was left to the second respondent
who was also to effect the change
of the name of the company at the companies and intellectual
properties commission (“CIPIC”).
He would see to the
allocation of shares and the appointment of directors. Due to slow
progress by the second respondent, the parties,
according to the
applicants, mandated Mr Lindsay (Lindsay) to do the job. This
included the opening of the applicant’s bank
account. In the
meantime, World Focus CC’s bank account, an entity operated by
the first respondent, would be used to receive
all funds that would
be payable to the first applicant. This would be the arrangement
until the first applicant got its own bank
account. Once the bank
account was opened the first respondent would then transfer the first
applicant’s funds from World
Focus account into the new
account.
During March 2014
the first applicant commenced its business. On 27 June 2014 the first
respondent, representing the first applicant,
concluded a Value Added
Resellers Agreement with the first applicant’s main
supplier-Suresense Technologies Ltd (Suresense)
based in the United
Kingdom. Mota-Engil one of the applicant’s main clients and
others were approached regarding the sale
of the Integra Controllers.
On 18 August 2014 the bank account at the First National Bank (the
nominated bank) was opened in the
name of JRMMC. This, according to
the applicants, was caused by the change of name to JRMM which had
not yet been effected. The
process was completed on 3 December 2014.
On 26 August 2014, and at the first applicant’s principal place
of business, a
meeting was held by the first and second respondents,
Dr Mark Hall (“Hall”), Lindsay, Prinsloo senior and Mr
Davies
(Davies) who represented Capital Mineral Resources Investment
Limited (CMRI). A conditional offer for an investment in JRMM
Technologies
(Pty) Ltd was signed by the parties. This is annexure
“D” to the founding affidavit. The term sheet as it is
called
contained the commercial terms as well as the rights and
responsibilities of the parties to the agreement. Matters relating to
the business of the respondent were discussed and Dr Hall was
appointed the General Manager of the first applicant. The applicants
contend that the first respondent misappropriated funds while the
second respondent benefited and concealed information which should
have reached the applicants. The first and second respondents were
suspended and ultimately subjected to a disciplinary hearing
in their
absence after they decided not to attend the disciplinary hearing.
They, at the
disciplinary hearing, faced various charges. They were at the end of
the hearing convicted as charged. They were then
advised of the
outcome of the hearing by email dated 28 November 2014. The outcome
is dated 1 December 2014. Developments after
the hearing resulted in
this application which was launched on 5 February and by way of
urgency. The application is opposed by
the respondents. The second
applicant, under case 9414/14 brought another application seeking a
final winding up order of the respondent
(first applicant) and that
its estate be placed in the hands of the Master of this court. That
application is also opposed by the
respondents
[4] The parties
agreed that the issue of urgency was first to be dealt with. The
parties argued and submitted their reasons why
the matter was urgent
or not urgent. I ruled that the matter was urgent. The parties then
dealt with the merits of the application.
[5] A dispute arose
between the shareholders of the first applicant. The applicants
contend that the respondents are:
divulging the
applicants’ confidential information and/or trade secrets;
wrongfully using the applicants’ confidential
information
and/or trade secrets; soliciting or seeking business from persons,
firms or companies who were or which were customers
of the applicant
during the period the respondents were employed by the first
applicant and passing off their business as that
of the first
applicant, and/or as representing the first applicant, and/or as
being connected in the course of trade with the first
applicant,
and/or using the first applicant’s name, and/or get-up or any
name and/or get-up which is confusingly or deceptively
similar to the
first applicants name and/or get-up. The applicants contend that the
respondents, because of their wrongful conduct,
ought to be
interdicted and restrained from such wrongful conduct. The
respondents dispute and deny this.
[6] To the founding
affidavit, and as annexures, the applicant has annexed the documents
relating to the winding up application.
The respondents are not happy
therewith.
[7]
The respondents are also not happy with the fact that the first
applicant features as an applicant in the application. The parties,
however, are in full agreement that the second applicant features as
an applicant because he is a shareholder. This then settles
the
problem of
locus
standi
particularly
once the first invalid resolution of the first applicant was replaced
by the resolution of 17 February 2015 through
which the actions by
the company were ratified.
THE ISSUE
[8] The issue to be
resolved is whether the respondents engaged in the conduct that the
applicants complain about. Put differently,
the issue is whether the
applicants have made out a case to be entitled to the relief that
they seek.
[9] On 23 February
2015 the respondents filed a Notice in terms of Rule 7 (1) of the
Uniform Rules of Court disputing the second
applicant’s
authority as well as that of Barnard Inc. Attorneys to act on behalf
of the first applicant. Mr Groenewald did
not seriously pursue the
dispute which I regard as having been out of the way.
COMMON CAUSE
FACTS
[10] These are
admitted facts and facts which are not seriously challenged or placed
in dispute. These are:
1. That the
respondents have been canvassing and conducting the business of the
first applicant;
2. that the
respondents performed services in terms of contracts in which the
first applicant is the service provider;
3. that the
respondents contacted the first applicant’s clients and told
them that there were people who were hi-jacking the
first applicant
and its business and that the clients should deal directly with them;
4. that the
respondents did business in the name of “originate Venture
partners” which simply referred to the first
applicant;
5. that the
respondents on Friday 30 January 2015 contacted Mr Louis Botha
(Botha), the first applicants’ agent, of Blue Torch
Electrical
in Cape Town attempting to get information from him relating to first
applicant’s client details in the Western
Cape and that
WhatsApp messages were also sent to Botha regarding this information.
Botha has provided a confirmatory affidavit
in connection therewith
and the affidavit is annexure “MJP9”. The applicants
contend that the conversation between
Botha and the first respondent
reveals that the first and second respondents intend taking over the
first applicant’s business
clients, suppliers, trade
connections, agents, and using the first applicant’s
confidential information and trade secrets,
equipment and stock to
the detriment of the first applicant and to the exclusive benefit of
the first and second respondents.
6. that the
respondents accepted funds in the bank accounts of numerous entities,
which the respondents control, received from first
applicant’s
clients.
7. that they are in
possession of an unspecified amount of Integra Controllers. They
however, contend that the Integra Controllers
were paid for by an
entity that is controlled by the first respondent, namely Champion
Tours CC.
8. that on 17
December 2014 the second respondent unlawfully and without the first
applicant’s authorisation took possession
of two Integra
Controllers valued at R210 000.00 from the first applicant’s
suppliers. The units were not delivered to the
first applicant.
9. that World Focus
CC received R1 628 727.00 from Mota-Engil
10. that First and
second respondents represented to the first applicant that only an
amount of R1 140 108.90 and not R1 628 727.00
had been paid to World
Focus CC by Mota-Engil.
11. that the
business of the first applicant was conducted under the name of JRMM
Technologies
12. that Mr Prinsloo
senior funded the business activities of the first applicant
including buying the Integra Controllers.
13. that World Focus
CC received on amount of R1 140 108.90 from Mota-Engil in its bank
account and only paid R199 794. 49 into
the bank account of the first
applicant. World Focus CC is the entity that was run and controlled
by the first respondent.
14. that the first
and second respondents are aware of the whereabouts of all the first
applicant’s Integra Controllers that
they did not return to the
first applicant.
15. that the first
and second respondents contend that they are entitled to represent
the first applicant.
16. that the
respondents admitted attending to the order placed by the applicant
during 2014.
17. that the
respondents and Prinsloo senior agreed to set up business together.
It seems to me that the directors would eventually
be the second
applicant and the respondents.
18. that Mr M P
Lindsay is the sole registered director of the first applicant as
borne out by annexure “B” the CIPIC
report on page 63 of
the papers.
19. that to solve
the problem of the bank account, which the first applicant did not
have, it was agreed that the bank account of
World Focus CC would, in
the meantime be used.
20. Once the first
applicant was properly registered after the name change, the first
respondent would have to transfer applicant’s
money from World
Focus CC’s account into the first applicant’s opened
account.
[11] Although the
decision was to have the respondents and the second applicant as
directors, for the reasons that I shall deal
with shortly, the only
registered director is still Mr Lindsay.
[12] Mr Groenewald,
for the respondents, submitted that the application was replete with
factual disputes necessitating the dismissal
of the application or
its referral to trial.
The following
factual disputes, according to him, relate to:
1. The authority to
represent the first applicant.
2. who the current
directors of the first applicant are
3. whether the
respondents were validly dismissed as directors of the first
applicant
4. whether Hall was
duly appointed as the general manager of the first applicant
5. whether the
second applicant is properly authorised to act on behalf of the first
applicant
6. the owner of the
movables which the applicants seek to claim from the respondents
7. whether the
respondents have the right to represent JRMM
8. whether the
second applicant and his father are attempting to exclude the
respondents from the day to day running of JRMM
9. whether the
respondents’ conduct was unlawful
10. whether the
first applicant is possessed of any confidential information or trade
secrets which the respondents may be intending
to use for personal
benefit or to the detriment of JRMM
11. whether such
information is confidential and worthy of protection.
The factual
disputes, according to Mr Groenewald, cannot be resolved in motion
proceedings. His submission is that the applicants
ought to have
foreseen the disputes arising.
[13] Mr Swanepoel,
for the applicants, contends that the application is devoid of
factual disputes of note.
THE LAW
[14] Farlam and
others in Erasmus: Superior Court Practice at B1-50A say:
“
The
Court will dismiss an application if the applicant should have
realised when launching his application that a serious dispute
of
fact, incapable of resolution on the papers, was bound to develop.”
This
view is echoed in
Gounder
v Top Spec Investments (Pty) Ltd
[2008] ZASCA 52
;
2008 (5) SA 151
(SCA) at
[10]
;
Tamarillo (Pty) Ltd v B N Aitken (Pty) Ltd
1982 (1) SA 398
(A) at
430G-431A; Burnkloof Caterers Ltd v Horseshoe Caterers Ltd
1976 (2)
SA 930
(AD) at 938; Stellenbosch Farmers’ Winery Ltd v
Stellenvale Winery (Pty) Ltd
1957 (4) SA 234
(C) at 235E-G); Transnet
Ltd t/a Metrorail and Others v Rail Commuters Action Group and Others
2003 (6) SA 349
(SCA) AT 368 C-D and G-H
and
Room Hire Co (Pty)
Ltd v Jeppe Street Mansions (Pty) Ltd
1949 (3) SA 1155
(T) at 1162
and 1168.
It is therefore
clear to the court that where a party makes a wrong choice by
following the route of motion proceedings where serious
disputes of
fact, incapable of resolution on the papers are bound to surface,
does so at his/her peril.
[15]
An application, where there are disputes of fact can only be granted
if the facts as stated by the respondents together with
the admitted
facts in the applicant’s affidavits justify such an order. The
facts alleged or admitted by the respondent are
paramount in the
consideration whether the application should go through or not. Facts
which cannot be denied though not formally
admitted must be regarded
as admitted.
Stellenbosch
Farmers’ Winery Ltd (supra).
THE SECOND
APPLICANT’S AUTHORITY TO ACT ON BEHALF OF THE FIRST APPLICANT
[16] The challenge
here is based on the validity of the special board resolution
annexure “MJP1” to the founding affidavit.
The annexure
clearly has been signed by Prinsloo senior and the second applicant.
The document is invalid simply because they are
both not registered
directors with CIPC. Lindsay is the sole registered director of the
first applicant. This cannot be denied.
The defective resolution was
substituted by the resolution that was passed by the director of JRMM
at a meeting which was held
on 17 February 2015. The resolution,
which is annexure “MJP16", appearing on page 377 of the
papers ratifies the actions
by the company (the first applicant). The
actions are the following:
“
1.
1.1. Institution of urgent legal proceedings in the High Court of
South Africa, Gauteng Division, Pretoria under case number
8595/2015
against Messrs R D Ball and J Morgan;
1.2 that the company
be authorised to instruct attorneys and legal counsel to attend to
any such legal proceedings;
1.3 that the company
may perform all such action and sign all such documents as may be
required to receive the interdict and protect
the business of the
company.
2. That MICHAEL JOHN
PRINSLOO (ID 820901 5126 08 8) be authorised to sign all such
documents, to depose to affidavits and do all
such things as may be
necessary to give effect to the above resolutions”
The resolution
relates to the directors of JRMM TECHNOLOGIES (PTY) LTD with
registration number 2014/034536/07 and has been signed
by the sole
director Mr Marc Paul Lindsay.
It
is noteworthy that ratification is permissible.
See
LYNN NO and Another v Coreejes and Another
2011 (6) SA 507
(SCA) at
510 B-C and Smith v Kwanonqubela Town Council
1999 (4) SA 947
(SCA)
[17] That the
ratifying resolution is signed by the sole registered director cannot
be denied. Mr Groenewald, however, submits that
the resolution has
not been signed by any of the persons who are supposed to be the
directors of the first applicant. Evidence
evinces that no other
person, save Lindsay, at the time, had become a director of the first
applicant. Evidence further evinces
that Lindsay, because of the
problem that had been experienced when forming the first applicant,
had to become the director who
would be in a position to effectively
bring the first applicant into existence and also open its bank
account. It seems to me,
that the respondents and the second
applicant becoming directors was overtaken by the souring of the
relationship between the respondents
and the Prinsloos and that
resulted in the two applications - this and the winding up
application. No one has to date brought an
action or an application
challenging the directorship of Lindsay. One gains an impression that
Lindsay became a director by agreement
between the parties. The fact
that the resolution of 17 February 2015 has not been signed by any of
the persons who were supposed
to be directors for the reason stated
above, is neither here nor there. Only the sole registered director
was authorised to sign.
This put paid the issue of authority raised
by the applicant and argued and submitted by Mr Groenewald.
[18] What I say in
paragraph 15 above effectively tells who the current legitimate
directors are.
WHETHER THE
RESPONDENTS WERE VALIDLY DISMISSED AS DIRECTORS OF THE FIRST
APPLICANT
[19] Depending on
the facts of the case, whether or not the respondents were validly
dismissed as directors may not necessarily
affect the launching of
this application. What must be remembered is that there is a sole
director who has the right to protect
the interests of the first
applicant in the event that they are wrongfully and unlawfully
threatened. It does not appear that the
respondents have challenged
the suspensions and the dismissals that they refer to in their
Answering Affidavit.
[20] The question
whether the second applicant is properly authorised to represent the
first applicant has, in my view, been answered
above.
THE OWNER OF THE
MOVABLES
[21] The
confirmatory affidavit of Mr Louis Botha (“Botha") becomes
very relevant in answering this question and others.
Botha is the
first applicant’s agent. His evidence is clear, unambiguous and
easy to follow. He briefly says that the first
respondent, in Cape
Town, contacted him and requested a meeting. They met on 30 January
2015. The first respondent advised him
that the two respondents had
been desirous of obtaining his services. Regarding the first
applicant, the first respondent said
to him:
1. that Lindsay
registered the company in his own name to cut the respondents out of
the first applicant;
2. that Prinsloo
senior and Dr Mark Hall (“Hall”) were trying to steal the
first applicant from the respondents;
3. that Hall
appointed himself in some position and “ just sits on his ass
and does nothing"
4. that Mr Andre
Swanepoel (“Andre”) was fully aligned with the cause of
the respondents and refused to work for the
first applicant.
5. that the first
respondent (and not the first applicant) had been paying the salary
of the second respondent over the last few
months including his
computer, car and phone;
6. that the first
respondent had signed an agreement with the first applicant’s
supplier (“Suresense”) in the
United Kingdom and that the
agreement was with the first respondent and not the first applicant.
7. that the
respondents were busy setting up their own company to deal with
Integra Controllers.
8. that within the
two weeks that would follow the first respondent would travel to the
United Kingdom to meet Suresense representatives
where he would
attempt to secure a R100m funding for Integra related business;
9. that the first
respondent was prepared to pay all agents 30% commission for
marketing the Integra products;
10. that the
respondents were busy with several large projects;
11. that the
respondents were to meet with Enviroserve, another current client of
the first applicant, on 2 February 2015 and they
wanted him to take
them to the first applicant’s other clients;
12. that Prinsloo
senior had only contributed R450 000.00 to the business of the first
applicant for the original stock purchase;
13. the first
respondent had only returned a few items of stock to the first
applicant’s office just to satisfy them. The
first respondent
had retained a lot of stock in his possession and the stock was
available to react quickly to potential orders;
14. the first
respondent implored Botha not to reveal this to anybody. He was not
to talk to representatives of the applicant and
that included Mr
Bernard Gilbert who worked for Botha as he was a friend of Prinsloo
senior.
[22] Botha could not
keep this to himself as implored. He decided to tell Ball about this.
On 2 February 2015 he received messages
from the second respondent
via WhatsApp. He requested Botha to send him details, addresses,
contact names and telephone numbers
of the first applicant’s
clients in the Western Cape where Botha had installed Integra
Controllers. The WhatsApp messages
received from the respondents are
annexures “LB1” and “LB2” respectively.
[23] Evidence
reveals that the respondents made several important admissions. These
are, inter alia:
1. that the first
respondent had met with Botha. The second respondent in the answering
affidavit, does not deal with the important
allegations that Botha
makes regarding the respondents and their conducts;
2. that the first
applicant, at all times, used the name JRMM Technologies. This is not
denied;
3. that Prinsloo
senior funded the business activities of the first applicant
including the purchase of Integra Controllers. This
is not denied;
4. that World Focus
CC, controlled by the first respondent, received the amount of R1 140
108.90 from Mota-Engil in its bank account.
This is not disputed;
5. that only R19
794.49 of the R1. 140 108.90 was paid to the first applicant by World
Focus CC. This is not disputed;
6. That World Focus
CC is implicated in invoices issued to clients of the first
applicant. This is not disputed;
7. That the second
respondent collected 2 Integra Controllers on 17 December 2014 which
were paid for by Prinsloo senior. This is
not seriously challenged;
8. that the first
respondents are aware of the whereabouts of all the first applicant’s
Integra Controllers not returned to
the applicant’s possession.
This is not disputed. This is further bolstered by Botha’s
evidence;
9. that the
respondents persist in their contention that they represent the first
applicant and that they are entitled to do so;
10. that they tell
applicant’s clients that people purporting to represent the
first applicant have “hi-jacked”
the enterprise and that
the client must deal directly with them;
11. that the
respondents are competing with the first applicant. The respondents
only contest the unlawfulness of their conduct.
[24] Mr Swanepoel
submitted, correctly in my view, that the admission by the
respondents that they were doing the first applicant’s
business
when they denied it in the winding up application does not augur well
for the respondent’s case. The respondents,
indeed, have
admitted a number of important allegations of the applicants.
[25] The admission
by the respondents that they did the first applicant’s business
presupposes that they are using the first
applicant’s
confidential information and/or trade secrets which includes the
first applicant’s customers, suppliers,
service providers,
agents, equipment sourcing costs, price lists and pricing structure
as well as the identities of any of the
first applicant’s trade
connections. This simply confirms the applicants’ complaint
that the respondents are using
the confidential information and/or
trade secrets of the first applicant for canvassing the first
applicant’s customers,
suppliers, service providers, agents
and/or trade connections or soliciting the business of the first
applicant’s customers,
suppliers, service provider, agents
and/or trade connections. This is borne out by Botha’s evidence
which discloses that
he had an important meeting with the first
respondent. Botha’s evidence clearly evinces that the
respondents are passing
off their business as that of the first
applicant and/or as being associated with the first applicant and/or
representing the first
applicant, and/or as being connected in the
course of trade with the first applicant, and/or using the first
applicant’s
name and/or get-up which is confusing or
deceptively similar to the first applicant’s distinctive name
and/or get-up
[26] Botha’s
evidence further shows that the respondents have the first
applicant’s assets and equipment including the
Integra
Controllers, demonstration units measurement and sellable units that
they appear to have retained. Botha has got nothing
to do with the
case. He has no reason to lie. He acted out of concern when he
decided to disclose what the respondents were busy
doing to Hall.
Coming by people such as Botha is a rarity.
[27] If there is a
case where the interests of a concern or a company need to be
protected, this is. It is clear that the relationship
between the
parties has irretrievably broken down with no chance of repairing
same.
[28] When evidence
is such as the court has, it can never be said that the respondents
are the right people to protect the first
applicant and its
interests. They do not, in my view, have the desire to represent the
first applicant. They were to become directors
but this did not
progress up to there. It was perhaps just as well that their becoming
directors was delayed. There is, at this
juncture, only one
registered director who has the right and authority to assist the
first applicant. The respondents are shareholders
and never became
directors of the first applicant. Had the respondents not done what
they did they probably would have become the
directors of the first
applicant.
[29] It does not
appear that the Prinsloos are attempting to exclude the respondents
from the day to day running of JRMM. After
all, the idea, when the
first applicant was formed, was that Prinsloo senior would only be
the funder who in turn would allow the
second applicant to become
director of the first applicant together with the respondents. One
sees no sinister or evil intention
on the part of the Prinsloos. They
appear to have had good intensions for the first applicant from the
very word go. Most of their
evidence is either admitted, not denied,
not disputed or not seriously challenged by the respondents. On the
contrary, the respondents
started by denying and ended up admitting
the applicants’ most important allegations. Botha sufficiently
exposed them. Their
conduct, in my view, is wrongful and unlawful.
[30] The
respondents, according to evidence, and for their conduct, were
suspended and removed from office. For the purposes of
this
application it is not necessary to determine whether the respondents
were properly suspended and removed from office. The
matter is
capable of solution without such a determination.
CONFIDENTIAL
INFORMATION AND TRADE SECRETS
[31] Confidential
information will undoubtedly include clients lists, details of
suppliers, service providers, trade connections,
agents, price lists
and structures and equipment sourcing costs. These are things which
are essential for the proper running of
one’s business. The
information, therefore, to qualify as confidential must be useful;
must not be public knowledge; and
must objectively have economic
value. A party claiming that information is confidential must have
proprietary, quasiproprietary
or other legal interest therein.
Evidence demonstrates that the applicants have satisfied the
requirements. For one to properly
do the applicant’s business,
the information which is confidential and only relating to the
business of the applicants becomes
a requirement. It cannot be
gainsaid that the respondents had such information. It became
necessary for the respondents to approach
Botha who ought to furnish
them with the information which they might not have had. It must be
remembered that the first respondent
would be responsible for the
marketing side and the second respondent the sales side of the first
applicant’s business. They,
accordingly, had access to the
first applicant’s confidential information and trade secrets.
[32] Mr Swanepoel,
for the applicant, correctly submitted that the respondents were
unlawfully competing with the applicant. Botha's
evidence supports
this. I accept Botha’s evidence. I have already referred to its
quality. One wonders what could have happened
had Botha danced to the
respondents’ tune.
[33]
The applicants’ case is clear and well supported where
necessary. The same cannot be said when it comes to the respondents’
case. They failed to produce necessary evidence such as evidence
relating to the two Integra Controllers which they claim to have
paid
for. They could have, for instance, produced receipts to prove this.
Such receipts are not there. Their denials are, in the
main, bare.
The denials, in my view, are of such a nature that they do not raise
real, genuine or
bona
fide
disputes
of fact.
(Plascon
Evans Paints v Van Riebeeck Paints 1984(3) SA 623(A) at 634 H-l).
[34]
I do not therefore agree that the application has real, genuine and
bona fide
disputes
of fact which prevent the court from arriving at a sound and informed
decision.
[35]
The facts averred in the applicant’s affidavits which have been
admitted by the respondents together with the facts alleged
by the
respondents, justify the granting of an order by the court. The
respondents’ allegations to me appear far-fetched,
clearly
untenable and so implausible as to warrant their rejection on the
papers. Viva voce evidence, in my view, would not disturb
the balance
of probabilities evident from the papers.
See
Rail Commuters Action Group and Others v Transnet Ltd t/a Metrorail
and Others 2005 (2) SA (CC) at 392 C-G; ELS v Weideman
2011 (2) SA
126
(SCA) at 138F-H and SH v GF and Others
2013 (6) SA 621
(SCA) at
626 G-H.
[36] It is not
correct that the applicants seek to interfere with the respondents’
rights to trade. If that were so the need
to wind up the first
applicant would not arise. Mr Swanepoel, while arguing the issue of
urgency, said that the bleeding of the
company needed to be stopped.
Looking at the evidence at the disposal of the court, his submission
becomes more clearer and acceptable.
ALTERNATIVE
REMEDY
[37] Mr Swanepoel
submitted that damages would be difficult to quantify. This is
correct. If one was dealing with the respondents
who revealed
everything, the position would be different. The respondents have
information regarding the applicants’ assets
but reveal very
little. They deny allegations and thereafter, when pressed to, admit
the very allegations. This strengthens Mr
Swanepoel’s
submissions that damages would be very difficult to quantify.
[38] The respondents
did not take the applicants and the court into their confidence
regarding this matter. The respondents are,
indeed, passing
themselves off as the first applicant as a springboard for their
business activities and to the first applicant’s
detriment.
They are, indeed, unlawfully and wrongfully competing with the
applicants. Most, importantly, they admit to conduct
that applicant
contend is clearly unlawful
[39] The
application, I my view, should succeed. However, an interim order is
more suited.
COSTS
Mr Swanepoel argued
for costs against the respondents on a punitive scale - i.e on the
scale as between attorney and client. They
base their submission on
the following
1. The respondents
were warned that in the event that they opposed the application,
costs on a punitive scale, would be asked for.
The respondents have
opposed the application.
2. The respondents
have maliciously and for their own benefit taken over the business of
the applicant
3. Their opposing
the application demonstrates ill intent. Mr Swanepoel submitted that
no costs would have been payable had they
opted for a proper route.
His further submission was that the respondents would not have
opposed the application if they had the
interest of the first
applicant at heart.
4. The respondents
failed to disclose the true financial and factual position of the
first applicant’s affairs and assets
in their possession and
under their control. This, according to Mr Swanepoel, would have
demonstrated their virtue in conducting
the affairs of the applicant
to the benefit of all.
[40] I am persuaded
to agree with Mr Swanepoel’s submissions which, in my view,
have merit. This matter is of such a nature
that costs of two counsel
are warranted.
[41] Mr Swanepoel
provided me with two draft orders. The one is for a final order and
the other for the interim order. I perused
both of them and found
that the interim order is most suited. Agreeing with the contents of
the interim order, I shall then proceed
to make it an order of the
court.
[42]
I, in the result,
make the following order:
The Draft order I
have marked “X”, signed and dated is made an order of the
court.
M.W MSIMEKI
JUDGE OF THE
GAUTENG DlVISION
PRETORIA
COUNSEL FOR THE
APPLICANT: Adv P A Swanepoel C A Boonzaier
INSTRUCTED BY:
COUNSEL FOR THE
RESPONDENT: Adv R J Groenewald
INSTRUCTED BY:
DATE OF HEARING:
DATE OF JUDGMENT:
IN
THE HIGH COURT OF SOUTH AFRICA
[GAUTENG
DIVISION, PRETORIA]
CASE NUMBER:
8595/15
In the matter
between:
JRMM
TECHNOLOGIES (PTY)
LTD
.........................................................................
1
ST
APPLICANT
MICHAEL
JOHN
PRINSLOO
......................................................................................
2
nd
APPLICANT
and
ROBIN
DOUGLAS
BALL
............................................................................................
1
st
RESPONDENT
JEFFREY
MORGAN
...................................................................................................
2
nd
RESPONDENT
DRAFT ORDER
AFTER
HAVING HEARD
the
representatives of the parties and having read the papers filed, the
following order is made:
IT IS ORDERED
THAT:
1. The First and
Second Respondents are hereby interdicted and restrained from:
1.1 Divulging to
anyone^ap/of the First Applicant’s confide Itial information
and/or trade secrets, which include but is not
limited to the
identity and contact details of the First Applicant’s
customers, sippliers, service providers, agents, equipment
sourcing
costs, price lists, and pricing structures and the identities of any
of the First Applicant’s trade connections;
1.2 Using any of the
confidential information and/or trade secrets of the First Applicant
as set out in prayer 1.1 hereinabove either
directly or indirectly in
any way whatsoever, including for the purposes of canvassing the
First Applicant’s customers, suppliers,
service providers,
agents and/or trade connections or soliciting the business of the
First Applicant’s customers, suppliers,
service providers,
agents and/or trade connections;
1.3 Soliciting or
seeking any business whatsoever either directly or indirectly from
any person, firm or company who was a customer
or trade connection of
the First Applicant during the First and Second Respondents’
period of employment with the First Applicant;
1.4 Passing off
their business as that of the First Applicant and/or as being
associated with the First Applicant, and/or as representing
the First
Applicant, and/or as being connected in the course of trade with the
First Applicant, and/or using the First Applicant’s
name and/or
get-up or any name and/or get-up'which is confusingly deceptively
similar to the First Applicant’s distinctive
name and/or
get-up;
2. The First and
Second Respondents are ordered to hand over to the First Applicant
all of the soft and/or hard copies of documentation
containing
information relating to the identity and/or contact details of the
First Applicant’s customers and/or suppliers,
and/or service
providers, and/or agents and/or equipment sourcing costs and/or price
lists and/or pricing structures and/or trade
connections within two
days from date of this order;
3. The First and
Second Respondents are ordered to hand over to the First Applicant
all assets and equipment of the First Applicant
in the possession
and/or control of the First and/or Second Respondents, including all
Integra Intelligent Motor Controllers, demonstration
units,
measurement equipment and sellable units, within two days from date
of this order;
4. The order as set
out in paragraphs 1 to 3 above will operate as an interim relief with
immediate effect, pending the outcome
of final relief sought by the
Applicants against the First and Second Respondents in an action to
be instituted by the Applicants
against First and Second Respondents
within 30 days from the date of this order.
5. The First and
Second Respondents are ordered to pay the Applicants’ costs on
a scale as between attorney and client, including
the costs of two
counsel.
BY ORDER
REGISTRAR