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[2014] ZAGPPHC 413
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African Oxygen Ltd v M & H Cohen CC and Others, In Re; M & H Cohen CC v African Oxygen Ltd (42659/2012, 54541/2012) [2014] ZAGPPHC 413 (28 May 2014)
REPUBLIC
OF SOUTH AFRICA
IN THE HIGH COURT
OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE
NO:
42659/2012
DATE:
28 MAY 2014
NOT
REPORTABLE
NOT
OF INTEREST TO OTHER JUDGES
In the matter
between:
AFRICAN OXYGEN
LTD
..........................................................................................................
APPLICANT
and
M & H COHEN
CC
...........................................................................................................
1
st
RESPONDENT
MAXINE GERHARD
COHEN
.......................................................................................
2
nd
RESPONDENT
BELL CRESCENT
PROPERTIES
CC
...........................................................................
3
rd
RESPONDENT
AND
CASE
NUMBER:
54541/2012
In the matter
between:
M & H COHEN
CC
.....................................................................................................................
APPLICANT
and
AFRICAN OXYGEN
LTD
......................................................................................................
RESPONDENT
JUDGMENT
KUBUSHI, J
[1]
In these court proceedings there are two
ex
parte
applications.
Both applications were launched in chambers. I shall for purposes of
convenience refer to the application under case
number 42659/2012
(which was instituted first) as the main application and the
application launched under case number 54541/2012
as the counter
application. The main application was instituted by Afrox, who is
also a respondent in the counter application.
I shall therefore refer
to the applicant in the main application and respondent in the
counter application as Afrox. The counter
application was instituted
by M
&
H
Cohen CC, who is also the 1
st
respondent in the main application. I shall refer in this judgment to
the applicant in the counter application and the 1
st
respondent in the main application as M
&
H.
I shall also refer to the 2
nd
respondent in the main application as Cohen and the third respondent
in the main application as Bell Crescent. Where I refer to
M & H
and Cohen jointly, I shall refer to them as the respondents.
[2]
The main application was launched on 15 August 2012 by Afrox against
M & H and Cohen. In that application the relief
sought by
Afrox was in two parts, namely, part A and part B. In terms of Part A
Afrox sought an order permitting it to attach certain
liquid
petroleum gas (LPC) cylinders belonging to it which were in the
possession of M & H and Cohen or either of them;
and in part
B it sought an order that the cylinders so attached be returned to
Afrox, together with final interdicts, preventing
M
&
H
and Cohen from receiving, filling and distributing Afrox’s LPG
cylinders together with certain ancillary relief, aimed at
ensuring
compliance with the interdict. Afrox was granted an
interim
relief
as a result of the
ex
parte
application.
Pursuant to that order 515 cylinders belonging to it were attached by
the sheriff at the premises controlled by the
M
&
H.
Some of these cylinders were full some were empty. The said order was
also served on M
&
H
and Cohen.
[3]
In retaliation, on 20 September 2012, M & H also brought an
ex parte
application
against Afrox for the attachment of its cylinders at Afrox’s
premises. The relief sought is along the same lines
as that sought by
Afrox in part B of the main application. M
&
H
was granted the
interim
relief
as a result of the
ex
parte
application
and pursuant to that order approximately 6 500 "Solgas”
cylinders and 682 “Indigas" cylinders
were attached from
Afrox’s premises by the sheriff.
[4]
Initially Afrox’s application was against M & H and
Cohen only. But later in the proceedings Bell Crescent was
joined as
the 3
rd
respondent in the main application. In its papers in the main
application, Afrox cited M & H as a close corporation
trading
as ‘The Gas Company’. In M & H’s
answering affidavit in the main application, Cohen, who is the
deponent
therein, contends that he is the sole member of M
& H
and
denies that M & H trades as The Gas Company’.
According to Cohen the entity trading as ‘The Gas Company’
is Bell Crescent Properties CC (Bell Crescent). Consequently Afrox
launched an application to join Bell Crescent to the proceedings
which was granted. Bell Crescent is now the 3
rd
respondent in the main application.
[5]
M
&
H
and Cohen are opposing both Afrox’s
interim
order
and the substantive relief claimed in part B of the application.
Afrox is also opposing M & H’s
interim
order
and the substantive relief sought therein. Bell Crescent as the third
respondent in the main application is also opposing
Afrox’s
interim
order.
BACKGROUND
[6] Afrox and M & H
are wholesale sellers and distributors of LPG. Afrox cylinders carry
the logos “Afrox”
and “Handigas” whilst M
& H’s cylinders carry the logos “Indigas”
and “Solgas”.
Afrox is contesting that the cylinders
carrying the logo “Solgas” belong to M & H.
During argument, the respondents’
counsel relented and conceded
that the “Solgas" cylinders should for purposes of this
judgment not be considered as
M & H’s cylinders. Both
parties have a significant number of gas cylinders in the market
place and are thus lawful
competitors in the LPG market. Afrox
however, is admittedly the bigger player of the two in the industry.
[7] It is common
cause that each party retains ownership of its cylinders which get
distributed into the market on a deposit system.
The end user
purchases only the LPG in such cylinders. It is also not in dispute
that the filling and distribution of the cylinders
is regulated by
various regulations and safety standards. In terms of these
regulations and safety standards it is unlawful to
fill LPG cylinders
without the permission of the owner. Conversely it is also unlawful
to distribute the cylinders without authorisation
from the owner. A
trade practice has as a result developed where consumers can take
their empty gas cylinders to any LPG distributor
to swop it for a
full one. The distributors come into possession of each other’s
cylinders, and exchange such cylinders from
time to time. Afrox and M
& H have an agreement in line with this exchange practice.
They have each approached the court
for relief on the ground that the
other does not fully comply with the terms of the said agreement.
POINTS
IN LIMINE
[8]
In opposing the main application, the respondents as well as Bell
Crescent have, respectively, raised points
in
limine.
The
respondents have raised the following points
in
limine
a.
Lis alibi
pendens-,
b. No case made out
against Cohen; and
c. Doctrine of
unclean hands.
Bell
Crescent raised the following points
in
limine.
a. the supplementary
founding affidavit of Andre du Preez is defective;
b. No allegations
made against Bell Crescent; and
c. Dispute of fact.
I shall deal with
the points
in seriatim
as they were argued in court.
Lis Alibi
Pendens
[9] It is common
cause that Afrox instituted application proceedings against the
respondents in the magistrate’s court under
case number
39918/09 (the 2009 application). The respondents opposed the 2009
application. Afrox’s contention is that the
facts in the main
application demonstrate that the application is based on entirely
different facts to those in the 2009 application.
Afrox’s
counsel submitted in argument that the dispute in the 2009
application was finalised when the parties entered into
a settlement
agreement.
[10] The respondents
are however, not in agreement with Afrox’s submissions.
According to them the facts between the main
application and the 2009
application are the same; and that the settlement agreement between
the parties was not in respect of
the 2009 application but in respect
of the search and seizure warrant which Afrox issued against M & H.
[11]
The issue to be determined is whether Afrox is precluded from
obtaining relief against the respondents on account of the defence
of
lis
alibi pendens.
[12]
The general principle is that once a suit has been commenced before a
tribunal that is competent to adjudicate upon it, the
suit must
generally be brought to its logical conclusion before that tribunal
and should not be replicated
{Us
alibi pendens).
The
suit between the same parties should be brought once and finally. See
Socratous
v
Grindstone
Investments
.
1
[13]
The party wishing to raise a defence of
Us
alibi pendens
bears
the
onus
of
alleging and proving that there is pending litigation between the
same parties or their privies, based on the same cause of action
in
respect of the same subject matter. See Harms:
Amler’s
Precedents of Pleadings
2
.
the LPG industry
and/or against payment of a deposit for each cylinder and/or against
payment of the value of LPG in each cylinder.
2.5 Failing
compliance by African Oxygen Limited with the terms of paragraph
2.4
above the relevant sheriff, who may be accompanied by a
representative of M & H Cohen CC and/or attorney of M & H
Cohen CC of record, is directed to take possession of any of M
&
H
Cohen CC’s cylinders which are found by the sheriff in the
possession of African Oxygen Limited at any premises where African
Oxygen Limited may be trading, or which are found by the sheriff on
any motor vehicle or motor vehicles which are identified as
those of
African Oxygen Limited or which are being used to convey any such
cylinders for or on behalf of African Oxygen Limited
either presently
or in the future, and whether such cylinders contain LPG or not and
that the sheriff is authorised forthwith to
hand these over to M & H
Cohen CC and/or M & H Cohen CC duly authorised
representative in terms of the cylinder
exchange practice which
operates in the LPG industry and/or against payment of a deposit for
each cylinder and/or against payment
of the value of LPG in each
cylinder.
2.6 African Oxygen
Limited return to M & H Cohen CC all of M & H Cohen
CC’s cylinders in their possession
in terms of the cylinder
exchange practice which operates in the LPG industry and/or against
payment of a deposit for each cylinder
and/or against payment of the
value of LPG in each cylinder.
3. Each party to pay
own costs.
[14] My view is that
the 2009 application and the main application are virtually the same.
The parties in both applications are
Afrox and the respondents; the
relief sought and the subject matter in both applications is the
same.
[15] I find Afrox’s
contention that the facts giving rise in the main application are new
facts which occurred after the 2009
application and as such cannot be
used to revive the 2009 application, to have no merit. Although the
facts in the present application
are new, they however relate,
firstly, to the same subject matter, that is, the alleged unlawful
filling and distribution of Afrox’s
LPG cylinders by the
respondents. In the 2009 application what was in issue was Afrox’s
LPG cylinders bearing the following
names or brand names: Handigas,
Afrox, African Oxygen and Acetylene Company, AOL, BOC Gases, Mobil,
Engen, Homegas, Sonap, Sonarep,
Treb, Socony, Caltex and Calgas. In
the main application the cylinders in issue are those bearing Afrox’s
brand names ‘Afrox’
and ‘Handigas’. The
cylinders with these brand names are also part of the subject matter
of the 2009 application. The
premises at which the cylinders are to
be attached in the main application are the same premises as in the
2009 application, that
is, the Bell Crescent property. It is on this
basis that I would conclude that the subject matter in both
applications is the same.
[16] Secondly, the
relief sought in both applications is the same as well. The relief
sought in both applications is:
a. to interdict and
restrain the respondents or any other person representing the first
respondent from receiving or being in possession
of LPG cylinders
with Afrox’s brand name.
b. to interdict and
restrain the respondents or any person acting on their behalf from
filling and distributing LPG cylinders bearing
Afrox’s brand
name.
c. that the
representatives of Afrox be permitted to enter the premises of the
first respondent and direct the respondents or persons
representing
them to surrender or handover to Afrox and/or any duly authorised
person any cylinders which bear it’s brand
name which may be in
the respondents’ possession.
d. failing
compliance by the respondents to direct the sheriff, who may be
accompanied by a representative of Afrox and/or attorney
to take
possession of any cylinder bearing the brand name of Afrox, found in
the possession of the respondents at any premises
the first
respondent is trading or which are found on the vehide(s) of the
respondents.
e. ordering the
respondents to jointly and severally, the one paying the other to be
absolved, pay Afrox’s costs of this application
on an attorney
and client scale.
[17]
The
I
is
in
the 2009 application between the parties is still before court as it
has not been finalised. A defence of
Us
pendens
rests
on the existence of a pending earlier action and is indeed dependent
on the actual existence of such other action. An action
at law is
disposed of and the
lis
(dispute)
between the parties is no longer before the court as soon as the
court has delivered its judgment and order or perhaps
the previous
action upon which the defendant relies is withdrawn. See
RSA
Faktor Bpk v Bloemfontein Town Developers (Edms) Bpk En Andere
3
.
[18]
Afrox’s submission that the
lis
between
the parties does no longer exist is factually incorrect. Its
contention is that there was a settlement agreement between
the
parties by which the 2009 application was finalised. The respondents’
objection to this contention is that the settlement
agreement was as
a result of the warrant of search and seizure which was issued by
Afrox pursuant to a criminal case against the
respondents and not
pursuant to the 2009 application. Afrox in its founding affidavit,
paragraphs 9.5 to 9.11 thereof, confirms
that it sought and obtained
a search and seizure warrant in terms of
sections 20
,
21
and
25
of
the
Criminal Procedure Act, 51 of 1977
, which was executed on 26
October 2010. Subsequent to the execution of the order, an oral
agreement in line with the exchange practice
in the industry was
concluded with Cohen.
[19]
It is well established that
Us
pendens
is
not an absolute bar. The court has a discretion to allow a matter to
proceed notwithstanding that the same issue may be pending
in another
court of competent jurisdiction. See
Janse
Van Rensburg NO
v
Steenhamp and Another; Janse Van Rensburg NO v Myburgh
4
.
[20]
As it has been said
Us
alibi pendens
is
a discretionary remedy. Consequently, even where all the required
elements of the defence are present, a court, if satisfied
that the
balance of convenience and equity are in favour of allowing the case
to proceed, may rule that the case should proceed.
On the basis of
the circumstances of this application, I am persuaded to exercise my
discretion in favour of Afrox. Afrox’s
submission that it had
to institute new proceedings because it would have been impracticable
to revive the 2009 application to
include the facts arising out of
the new investigations, which would lead to the necessity of further
sets of affidavits has convinced
me to exercise my discretion in its
favour.
[21] It is common
cause that the 2009 application was stalled at the behest of both
parties when they entered into a settlement
agreement pursuant to the
search and seizure warrant obtained by Afrox. Consequently Afrox did
not file its replying affidavit.
For Afrox to have proceeded with the
2009 application, firstly, it would have to file the replying
affidavit. Since the time within
which it was supposed to have filed
the replying affidavit has elapsed, Afrox would have to apply for
condonation for the late
filing of the said affidavit. Secondly,
since the facts which prevailed at the time of the launch of that
application have become
irrelevant, Afrox's case is that it
investigated the matter afresh and came up with new facts. In order
to bring these new facts
before the court, Afrox would have to apply
for the filing of a further affidavit to supplement its founding
affidavit. These are
procedures which are allowable in terms of the
uniform rules. However, my view is that it is much easier to proceed
with the current
application than to proceed with the cumbersome 2009
application which requires the filing of further affidavits. Afrox
must still
approach the court to be permitted to file the affidavits.
In my opinion the only sensible thing to do is to proceed with the
current
application before me. All parties in this case have
delivered full papers and the matter is ripe to be heard.
Unclean Hands
[22]
It is common cause that in the two
ex
parte
applications
the parties are accusing each other of unlawfully stockpiling each
other’s LPG cylinders and also unlawfully
filling and
distributing each other’s LPG cylinders. As a result each of
the parties alleges in their respective applications
that the other
party conveniently failed to disclose several material facts to the
court. This is indicated for example, by the
numerous cylinders
belonging to the other party attached by the sheriff.
[23] My view is that
both parties have approached this court with unclean hands. This
point is therefore neutral.
Case not made out
against Cohen
[24]
Afrox in making out a case against Cohen contends that Cohen should
be personally regarded as a joint wrongdoer with M & H.
Cohen’s response to the said allegation is that there is no
basis for him to be joined in his personal capacity in the
application.
My understanding of Afrox’s complaint is that i
should disregard the juristic personality of M & H and find
Cohen,
a member of M
&
H
which is a close corporation, to be jointly liable with M
&
H.
[25]
It is a well-known principle of our law that a company has legal
personality separate from that of its shareholders. That separate
personality may however, in certain circumstances be disregarded by a
court. The mere fact that a company has only one shareholder
who is
in full control of the company does not however constitute a basis
for disregarding its separate legal personality. See
Net
v
Metequity
Ltd
5
.
[26]
Judicial discretion to disregard or negate a juristic person's
separate personality is a generally acceptable principle in
our law.
Courts are however traditionally reluctant to disregard separate
juristic personality and are willing to do so only in
limited
circumstances. Such circumstances would generally have to include an
element of fraud or other improper conduct in the
use of the company
or the conduct of its affairs. In case of a close corporation, s 65
of the Close Corporation Act 69 of 1984
endows the judiciarv with the
statutory power to negate separate juristic personality, where it is
found that “the incorporation
of, or any act by or on behalf
of, or cny use of, that corporation, constitutes a gross abuse of the
juristic personality of the
corporation as a separate entity”.
See
Net
u Meteguity Ltd
above
6
.
[27]
Can it be said that in this instance the conduct of Cohen acting on
behalf of M & H as alleged by Afrox, constitutes
a gross
abuse of the juristic personality of M
&
H
as a separate entity?
[28]
The conduct of Cohen that Afrox is complaining of is that Cohen is
directly involved in the unlawful storing, filling and distribution
of Afrox’s cylinders. According to Afrox, the evidence
demonstrates that Cohen is aware of the activities of M & H’s
employees in the storing, filling and distribution of such cylinders.
He (Cohen) personally gives instructions to M & H’s
employees that they (the employees) store or fill empty cylinders of
Afrox that come into the possession of M
&
H.
Cohen gives such instructions well knowing that Afrox and M
&
H
do not have a distribution agreement between them. It is Afrox’s
submission that one of its sales manager, Andre Du Preez
whilst doing
some investigation, observed Cohen personally supervising the loading
of Afrox’s cylinders and took photographs
of Cohen performing
such supervision. Copies of the said photographs are attached to
Afrox’s founding affidavit as evidence.
[29]
These allegations against Cohen are not challenged by either M & H
or Cohen. Besides submitting that there is no basis
for Cohen to be
joined in his personal capacity in this application, none of the
allegations are specifically challenged. Cohen
concedes that M
&
H
is filling, although on a limited scale, Afrox’s cylinders in
order to survive because Afrox is also filling and distributing
M
&
H’s
cylinders. My view is that the filling and distribution of Afrox’s
cylinders by M & H without an agreement
between them is
unlawful and the reason Cohen provides for M & H to fill and
distribute Afrox’s cylinders, does
not take away the fact that
M
&
H
is performing those activities unlawfully. I have to conclude
therefore that Cohen’s involvement is such activities
constitutes
a gross abuse of the juristic personality of the
corporation as a separate entity and Cohen should as a result be
regarded as a
joint wrongdoer with M
&
H.
Failure to Comply
with Regulation 3.1
[30]
The first point
in
iimine
raised
by Bell Crescent is that Afrox’s supplementary founding
affidavit does not comply with the provisions of regulation
3.1 of
the Regulations Covering the Administration of Oaths or Affirmation
CN R1258 dated 21 July 1972 (the Regulations), in that
the affidavit
was not signed by the deponent. I was in this regard referred to the
judgments in
S
v Msibi
7
,
Swart
u Swart
8
and
Engineering
Requisites (Pty) Ltd v Adam
9
.
[31]
Uniform rule 6 (1) requires that every application to be brought on
notice of motion should be supported by an affidavit as
to the facts
upon which the applicant relies for relief. An affidavit in
application proceedings must set out all that would be
necessary in a
trial. See
Saunders
Valve Co Ltd v tnsamcor (Pty) Ltd
10
.
[32] In terms of
regulation 3.1 the deponent should sign the declaration in the
presence of the commissioner of oaths. A declaration
includes an
affidavit. In this instance. Bell Crescent’s contention is that
Afrox’s case against it is exclusively
based on the allegations
contained in Afrox’s unsigned supplementary founding affidavit.
And according to the respondents’
counsel since the affidavit
is not signed it cannot be said that there is an affidavit before the
court because the applicant did
not comply with the requirements of
regulation 3.1. He contends that as a result Afrox has not complied
with uniform rule 6.1.
To the contrary, the submission by Afrox’s
counsel is that based on the common cause facts on this point, the
defect is a
technical point which should not be entertained by this
court.
[33]
Non-compliance with the provisions of regulation 3 does not
per
se
render
a purported affidavit void, for that provision is not peremptory, but
directory. The court has a discretion to regard a declaration
that
does not comply with regulation 3 as worthless, or to recognise it as
an affidavit. It also has a discretion, in a suitable
case, to allow
evidence to be produced on the question whether in reality the
provisions were satisfied or not, before a decision
is arrived at on
the information so produced. See
S
v Msibi
above
and
Cape Sheet
Metal Works (Pty) Ltd v J J Calitz
Builder
(Pty) Ltd
11
.
[34]
In deciding whether the non-compliance is of such a nature that the
court should refuse to entertain the affidavit, it is clearly
relevant to have regard to the nature and purpose of the requirement
with which there has been failure to comply. In this instance,
the
complaint is that the deponent did not sign the affidavit whereas in
terms of the regulation the deponent should have signed
the
declaration in the presence of the commissioner of oaths. Compliance
with the regulations provides a guarantee of acceptance
in evidence
of affidavits attested in accordance therewith. Where an affidavit
has not been so attested, it may still be valid
provided there has
been substantial compliance with the formalities in such a way as to
give effect to the purpose of the legislator.
The courts discretion
to refuse to receive an affidavit attested to otherwise than in
accordance with the regulations would depend
upon
whether
or not substantial compliance with the regulations has been proved.
See
S
v Munn
12
.
[35] It is common
cause that the proceedings in this instance are application
proceedings which should be supported by an affidavit.
It is common
cause that Bell Crescent was joined to the proceedings at a later
stage and a supplementary founding affidavit had
to be filed by Afrox
in that respect. It is not in dispute that the said supplementary
founding affidavit on which Afrox relied
in support of its case
against Bell Crescent was not signed by the deponent. It is also not
in dispute that the supplementary founding
affidavit was initialled
on all the pages including the last page but a full signature was not
attached. Afrox has also subsequently
filed a new supplementary
founding affidavit which complies in all respects with regulation
3.1.
[36] It is indeed so
that the defect in the supplementary founding affidavit initially
filed by Afrox does not render the purported
affidavit void because
the provisions of regulation 3.1 are merely directory. I therefore
have a discretion to decide whether to
accept the affidavit into
evidence or not. In order for me to exercise this discretion, I must
be provided with the grounds for
the exercise of the discretion.
Counsel for Bell Crescent is of the view that such grounds have not
been made available to me.
I am however of the opinion that the
common cause facts as stated in paragraph [35] of this judgment are
sufficient grounds to
enable me to exercise the discretion.
[37]
Based on the said common cause facts my view is that I should
exercise the discretion in favour of Afrox. It is so that the
Regulations do not state the manner in which the affidavit ought to
be signed. My view therefore is that the initials of the deponent
attached to the supplementary founding affidavit should be accepted
as an indication that the declaration was indeed signed. The
submission by Bell Crescent’s counsel that it cannot be
determined from the said initials that it was the deponent who put
the initials there is to me without merit. The deponent initialled
all the pages in the presence of the commissioner of oaths who
attested same. A new affidavit was filed which was initialled and
fully signed by the deponent. The initials on the old affidavit
appear to be the same as those in the new affidavit and there being
no evidence to the contrary should be accepted as having been
attached by the deponent.
[38] I conclude
therefore that there has been substantial compliance by Afrox with
the provisions of regulation 3.1. As a matter
of convenience, the new
affidavit, which complies in all respect with regulation 3.1 should
substitute the old affidavit. Bell
Crescent will not be prejudiced by
the admission of the affidavit into evidence. The purpose of the
initial affidavit was to inform
Bell Crescent of the case it has to
meet and the new affidavit serves the same purpose. Consequently
there is compliance with uniform
rule 6 (1).
No Case Against
Bell Crescent
[39] It is common
cause that at the commencement of these proceedings Bell Crescent was
not a party to the proceedings. It was joined
as a party at a later
stage when Cohen provided information in his answering affidavit that
the party trading as ‘The Gas
Company’ is Bell Crescent.
As such in its founding affidavit Afrox did not make out a case
against Bell Crescent. It therefore
had to file a supplementary
founding affidavit.
[40]
Bell Crescent contends that there is a dispute of fact as regards the
allegations against it in Afrox’s supplementary
founding
affidavit. The clearest instance in which a real dispute of fact
arises is of course when the respondent denies all the
material
allegations made by the various deponents of the applicant on the
applicant’s behalf and produces positive evidence
by the
deponents to the contrary. See
Room
Hire Co (Pty) Ltd v Jeppe Street Mansions (Pty) Ltd
13
[41]
My view is that there is a dispute of fact in this instance. The
allegation by Afrox in the supplementary founding affidavit
which
connects Bell Crescent to the unlawful allegations is that. Bell
Crescent trades as ‘The Gas Company’. And ‘The
Gas
Company’ in turn is actively involved or participates with M
& H in the unlawful activities. This, according
to Afrox, is
because M & H uses a vehicle clearly marked with the signage
of ‘The Gas Company’ as a delivery
vehicle. Bell Crescent
in its answering affidavit denies any involvement of whatever nature
with the business affairs of M
&
H
relating to the allegations by Afrox.
[42]
The approach that a court adopts when there is a dispute of fact in
motion proceedings is set out
in
Ptascon-Euans
Paints v Van Riebeeh Paints Ltd
14
.
In
such an event the court will decide the matter on the version of the
respondent and the common cause facts. The exception to
this rule is
a finding that the respondent’s version set out in the
answering affidavit, taken as a whole, is so palpably
implausible,
far-fetched and untenable that it must be rejected out of hand.
[43] It is therefore
my view that I having concluded that there is a dispute of fact in
this instance, I have to decide the matter
on the version of Bell
Crescent. Consequently I have to find that there is no case made out
by Afrox against Bell Crescent and
Afrox’s claim against Bell
Crescent must as a result fail.
MERITS
[44] It is common
cause that both Afrox and M & H are lawful participants in
the cylinders exchange practice. In terms
of the said practice,
lawfully operating suppliers of cylinders participate in the exchange
practice to enable them to regain possession
of their cylinders. The
exchange practice operates as follows:
a. When a supplier
or distributor receives cylinders belonging to another supplier on
exchange, it returns them to the supplier,
receiving in exchange such
cylinders as the latter may have which belong to the former.
b. If the number of
empty cylinders exchanged do not match, the recipient of the greater
number of empty cylinders will pay the
current deposit value of those
empty cylinders received, which exceed in number the empty cylinders
delivered.
c. When a customer
or end-user purchases LPG from any wholesale supplier or distributor
for the first time, the customer pays the
refundable deposit plus VAT
in respect of the cylinder containing the LPG, in order to obtain
possession of the cylinder.
d. In practice,
suppliers and distributors seldom service customers by refilling the
empty cylinders as and when they are returned.
e. Usually the
customer is provided with a pre-filled cylinder whilst the empty
cylinder returned by such customer is refilled later
(But only by the
entity authorised to re-fill such cylinder) and thereafter supplied
to another customer.
f. A customer may
replace an empty cylinder from time to time by way of an “exchange",
i.e. returning the empty cylinder
and being provided with a “full”
cylinder but only being charged for the contents thereof depending on
the volume of
actual LPG supplied.
g. The distributors
who provides and end user with a full cylinder on exchange is only
permitted to provide a full cylinder belonging
to a supplier who has
authorised the distributor to supply its cylinder.
[45] The exchange
system is designed to ensure that all cylinders, including their
fittings, are returned to their owners and inspected
and checked for
damage or corrosion. Should the cylinder be found to be defective,
they are either repaired (providing that they
can be repaired and
safely used thereafter) or they are discarded.
[46]
I
am
of
the view that the cylinder exchange practice which operates in the
LPG industry can be used to resolve the dispute between the
parties.
In terms of this practice the parties will be able to collect their
cylinders from each other’s premises against
payment of
deposits. Both parties are lawful participants in the LPG industry
and are bound to, on a regular basis, come in possession
of each
other's cylinders. This cannot be avoided. The only way they can
collect their cylinders from the other’s premises
is through
the cylinder exchange practise. The parties are agreed that this
practice is acceptable within the LPG industry. They
are agreed that
they have respectively taken part in this practice. They have also in
the past exchanged cylinders between each
other in terms of this
practice. This evident from the following:
a. At the time the
parties terminated the distribution agreement between them, they
entered into an agreement to exchange cylinders.
In paragraph d) of
termination agreement dated 10 December 2007, the parties agreed as
follows:
i. Return and
Exchange of Cylinders
ii. Both parties
agree to exchange cylinders:
- on a like for like
basis
- any for any basis
- in accordance with
the ruling deposit rates and in accordance with conventional
accounting practices
- as per the
dictates and norms of the LPG industry and LPG Association.
b. Pursuant to the
execution of the search and seizure warrant of October 2010 the
parties entered into an oral agreement which
was in line with the
exchange practice relied on by Afrox in its founding affidavit and
was confirmed in a letter dated 9 November
2010. The terms of which
were as follows:
i. the first
respondent would release the applicant's cylinders to it against
payment of the applicable deposit;
ii. the applicant
would return to the first respondent any of the first respondent’s
cylinders that had come into the applicant’s
possession against
payment of a deposits;
iii. he applicant
would be entitled to attend at the first respondent’s premises
on a fortnightly basis to collect its cylinders.
In terms of the said
agreement both parties collected a number of cylinders from each
other’s premises against payment of
deposits. This agreement
has until the launch of these applications been in place and
apparently operating.
[47] What is however
is in issue is that both parties allege that the other is unlawfully
stockpiling the other’s cylinders
and as such refuses to hand
them over when the other party comes in to collect them. This
challenge can be resolved by an order
that allows similar to the one
sought by Afrox in part B of its notice of motion which is also
similar to the order sought by the
respondents in its notice of
motion. I am as such inclined to grant such an order.
[48] I therefore
grant the following order:
The order marked
with an “X’’ is made the order of this court.
E. M. KUBUSHI
JUDGE OF THE HIGH
COURT
HEARD ON THE: 25
FEBRUARY 2014
DATE OP JUDGMENT:
28 MAV 2014
APPLICANT'S
COUNSEL: ADV P STRATHERN
APPLICANT’S
ATTORNEY: BOWMAN GILFILLAN
c/o
GILDENHUYS LESSING MALATJl
lst
& 2
nd
RESPONDENTS’ COUNSEL : ADV
B. NEUKIRCHER SC
ADV S. MENTZ
lst
& 2
nd
RESPONDENTS’ ATTORNEY: COENRAAD KUKKUK ATTORNEYS
3
rd
RESPONDENT’S COUNSEL: ADV A. THOMPSON
1
st
RESPONDENT’S ATTORNEY: JACOBS ATTORNEYS
IN THE HIGH COURT
OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE NO:
42659/2012
In the matter
between:
AFRICAN OXYGEN
LTD
..........................................................................................................
APPLICANT
and
M & H COHEN
CC
............................................................................................................
1
st
RESPONDENT
MAXINE GERHARD
COHEN
........................................................................................
2
nd
RESPONDENT
BELL CRESCENT
PROPERTIES
CC
..........................................................................
3
rd
RESPONDENT
AND
CASE NUMBER:
54541/2012
In the matter
between:
M & H COHEN
CC
.....................................................................................................................
APPLICANT
and
AFRICAN OXYGEN
LTD
......................................................................................................
RESPONDENT
ORDER
1. Re: Main
Application – Case Number: 42659/2012
1.1 The cylinders
inventoried and attached at the Bell Crescent property as belonging
to the African Oxygen Limited be returned
to it in terms of the
cylinder exchange practice which operates in the LPG industry and/or
against payment of a deposit for each
cylinder and/or against payment
of the value of the LPG in each cylinder.
1.2 M & H
Cohen CC and/or any of its servant or employee or other person
purporting to act on its behalf is interdicted
and restrained from
receiving or being in possession of any cylinders, which are the
property of African Oxygen Limited and/or
to which African Oxygen
Limited has a lawful claim and which bear the African Oxygen
Limited’s brand names “Afrox”
or “Handigas”.
1.3 M & H
Cohen CC and/or its servant or employee or person purporting to act
on its behalf is interdicted or restrained
from filling or
distributing any of African Oxygen Limited’s cylinders which
carry African Oxygen Limited’s brand names
“Afrox"
or “Handigas”.
1.4 Representatives
of African Oxygen Limited be permitted to attend at and to enter upon
the Bell Crescent property or any other
premises within the
jurisdiction of this court from which M & H Cohen CC
conducts business, on a weekly basis during normal
business hours,
and M & H Cohen CC should surrender and hand over to African
Oxygen Limited and/or any other person duly
authorised thereto by
African Oxygen Limited’s, any of African Oxygen Limited’s
cylinders which can be identified as
such and/or which carry African
Oxygen Limited’s branding which are in the possession of M & H
Cohen CC in terms
of the cylinder exchange practice which operates in
the LPG industry and/or against payment of a deposit for each
cylinder and/or
against payment of the value of the LPG in each
cyclinder.
1.5
Failing compliance by M & H Cohen CC with the terms of
paragraph 4 above the relevant sheriff, who may be accompanied
by a
representative of African Oxygen Limited and/or attorney of African
Oxygen Limited of record, is directed to take possession
of any of
African Oxygen Limited’s cylinders which are found by the
sheriff in the possession of M & H Cohen CC
at any premises
where M & H Cohen CC may be trading, or which are found by
the sheriff on any motor vehicle or motor vehicles
which are
identified as those of M
&
H
Cohen CC or which are being used to convey any such cylinders for or
on behalf of M
&
H
Cohen CC either presently or in the future, and whether such
cylinders contain LPG or not and that the sheriff is authorised
forthwith to hand these over to African Oxygen Limited and/or African
Oxygen Limited duly authorised representative in terms of
the
cylinder exchange practice which operates in the LPG industry and/or
against payment of a deposit for each cylinder and/or
against payment
of the value of the LPG in each cylinder.
1.6 M & H
Cohen CC to return to African Oxygen Limited all of African Oxygen
Limited’s cylinders in their possession
in terms of the
cylinder exchange practice which operates in the LPG industry and/or
against payment of a deposit for each cylinder
and/or against payment
of the value of the LPG in each cylinder.
2.
Re: Counter Application
2.1
The cylinders inventoried and attached at Emmanuel Street, Roodefeop,
Germiston, (the premises) as belonging to M
&
H
Cohen CC be returned to it in terms of the cylinder exchange practice
which operates in the LPG industry and/or against payment
of a
deposit for each cylinder and/or against payment of the value of the
LPG in each cylinder.
2.2 African Oxygen
Limited and/or any of its employees or other person purporting to act
on its behalf is interdicted and restrained
from receiving or being
in possession of any cylinders, which are the property of M & H
Cohen CC and/or to which M & H
Cohen CC has a lawful claim
and which bear the M & H Cohen CC’s brand name of
“Indigas”.
2.3
African Oxygen Limited and/or its employees or person purporting to
act on its behalf is interdicted or restrained from filling
or
distributing any of M
&
H
Cohen CC’s cylinders which carry M & H Cohen CC’s
brand name of “Indigos”.
2.4
Representatives of M & H Cohen CC be permitted to attend at
and to enter at Emmanuel Street, Roodebop, Germiston or
any other
premises within the jurisdiction of this court from which African
Oxygen Limited conducts business, on a fortnightly
basis during
normal business hours, and African Oxygen Limited should surrender
and hand over to M
&
H
Cohen Limited and/or any other person duly authorised thereto by M
&
H
Cohen CC’s, any of M & H Cohen CC’s cylinders
which can be identified as such and/or which carry M
&
H
Cohen CC’s branding which are in the possession of African
Oxygen Limited in terms of the cylinder exchange practice which
operates in the LPG industry and/or against payment of a deposit for
each cylinder and/or against payment of the value of LPG in
each
cyclinder.
2.5 Failing
compliance by African Oxygen Limited with the terms of paragraph 2.4
above the relevant sheriff, who may be accompanied
by a
representative of M & H Cohen CC and/or attorney of M & H
Cohen CC of record, is directed to take possession
of any of M & H
Cohen CC’s cylinders which are found by the sheriff in the
possession of African Oxygen Limited
at any premises where African
Oxygen Limited may be trading, or which are found by the sheriff on
any motor vehicle or motor vehicles
which are identified as those of
African Oxygen Limited or which are being used to convey any such
cylinders for or on behalf of
African Oxygen Limited either presently
or in the future, and whether such cylinders contain LPG or not and
that the sheriff is
authorised forthwith to hand these over to M & H
Cohen CC and/or M & H Cohen CC duly authorised
representative
in terms of the cylinder exchange practice which
operates in the LPG industry and/or against payment of a deposit for
each cylinder
and/or against payment of the value of LPG in each
cylinder.
2.6African Oxygen
Limited return to M & H Cohen CC all of M & H Cohen
CC’s cylinders in their possession
in terms of the cylinder
exchange practice which operates in the LPG industry and/or against
payment of a deposit for each cylinder
and/or against payment of the
value of LPG in each cylinder.
3.
Each party to pay own costs.
1
(149/10)
[2011] ZASCA 8
para [14] (10 March 2011)
2
7
th
ed p26B - 264
3
1981 (2)
SA
141
(O) at 145A - B
4
2010
(1) SA 649
para [35]
5
2007
(3) SA 34
(SCA) para [11] at 38H - I
6
at
para [11]
7
1974
(4) SA 821
(T)
8
1950
(1) SA 263
(0) at 267
9
1977
(2) SA 175
(O) at 178
10
1985
(1) SA 144
(TPD) at 149C
11
1981
(1) SA 697
(O) at 699A - D
12
1973
(3) SA 734
(NQ at 737 and 738A -
C
13
1949
(3) SA 1155
(T)
14
[1984] ZASCA 51
;
1984
(3) SA 623
(A) at 634F