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[2011] ZAECELLC 4
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IDEA Technologies (Pty) Ltd v AK Communications CC and Another (EL 224/2011) [2011] ZAECELLC 4 (31 May 2011)
NOT
REPORTABLE
IN THE HIGH COURT OF SOUTH AFRICA
(EAST LONDON CIRCUIT LOCAL
DIVISION)
EL: 224/2011
ECD: 224/2011
In the matter between: Case No:
IDEA TECHNOLOGIES (PTY) LTD
…........................................................
Applicant
And
AK COMMUNICATIONS CC First
…......................................................
Respondent
THE MANAGER, NEDBANK LTD
VINCENT PARK, PORT ELIZABETH
…...................................
Second Respondent
Coram:
Chetty J
Date Heard:
17 May 2011
Date Delivered:
31 May 2011
Summary:
Final
interdict – Requisites for established – First respondent
admitting liability to applicant – Form of relief
circumscribed
– Rule
nisi
confirmed in part
______________________________________________________________
JUDGMENT
______________________________________________________________
Chetty, J
[1] The first respondent was awarded a
tender to supply the Compensation Fund (the Fund) with toners,
cartridges and photo conductors
on a quotation and purchase order
basis and to that end concluded a service level agreement with the
Fund. By its own admission
it lacked the financial resources to
fulfil its contractual obligations and consequently entered into a
written agreement with
the applicant for the supply to it of the
goods which formed the subject matter of the service level agreement
with the Fund.
[2] The agreement concluded between
the applicant and the first respondent provided as follows:
“
1)
It is recorded that for the duration of the contract with the
Compensation Commissioner, the Managing Director of “Idea”,
i.e. Edward Jadine Batty, or failing him for whatever reason
whatsoever, Nobubele Valencia Vuba shall enjoy joint signing
authority
on any banking account operated by AK Communications and
specifically the cheque account at Nedbank, Account Number 1206 075
155.
Branch Code 120 621.
2) It is furthermore
recorded that “Idea” have secured the supply of printer
cartridges to be sold by “AK Comm”
to the Office of the
Compensation Commissioner and by virtue of its financial exposure
which will arise out of the execution of
contract, “Idea”
shall be entitled to payment of 50% (fifty percent) of the Gross
Profit generated by all sales from
“AK Comm” to the
Office of the Compensation Commissioner.
3) Should the managing
member of “AK Comm”, i.e. Sitembiso Sicengu become
unable, for any reason whatsoever, to continue
to operate the
business known as “AK Comm”, the said Sitembiso Sicengu
hereby nominates irrevocably Nobubele Vuba to
assume his functions as
managing member of “AK Comm” for purposes of completing
the contract with the office of the
Compensation Commissioner.
4) “AK Comm”
hereby acknowledges that no other party will be involved in this
contract other than “Idea”.
5) The parties hereto
record that the printer cartridges to be delivered in terms of this
contract, will be supplied by Advanced
Channel Technologies (Pty) Ltd
and that agreement has been reached with Advanced Channel
Technologies (Pty) Ltd to the effect that
payment to the supplier,
i.e. Advanced Channel Technologies (Pty) Ltd, will be made
immediately upon, but no later than 7 days
after receipt of payment
from the Office of the Compensation Commissioner.
6) Sitembiso Sicengu
hereby acknowledges that he shall not be entitled to sell, divest in
any other way part with the 100% members
interest that he currently
holds/owns in “AK Comm” for the duration of this
contract.
7) It is furthermore
recorded that the parties hereto acknowledge that this venture shall
be conducted throughout the utmost good
faith.”
[3] Initially, the contractual
arrangements between the applicant and the first respondent were
performed in the manner provided
for in the agreement. During August
2010 however, the first inkling that the first respondent had
breached the terms of the agreement
surfaced and, potentially exposed
to risk, the applicant unsuccessfully attempted to resolve the
impasse between itself and the
first respondent’s alter ego, Mr
Sitembiso Sicengu
(
Sicengu
). The first respondent’s
breach of its contractual obligations was further exacerbated by its
refusal in September 2010 to
authorise the transfer of funds received
from the Fund in accordance with the agreement. Further enquiries
revealed the withdrawal
of funds, likewise in breach of the
agreement.
[4] Notwithstanding the fact that as
far back as January 2011, the applicant had been appraised of the
fact that a substantial amount
of money had been deposited into the
first respondent’s banking account with the second respondent
coupled with the refusal
to settle its indebtedness to the applicant
and the removal of the applicant’s managing director,
Edward
Jadine Batty
(
Batty
) as a signatory to the banking account
as envisaged in paragraph 1 of the agreement, the applicant, save for
remonstrating with
Sicengu
, took no tangible steps to protect
its interests.
[5] On 4 March 2011, it awoke from its
slumber and sought orders as one of urgency in which the relief was
framed as follows:-
“
2.
Directing that a rule nisi to issue returnable on a date to be
determined by the above Honourable Court calling upon the First
Respondent to show cause, if any, why, pending an action to be
instituted by the Applicant against the First Respondent for all
amounts due to the Applicant in terms of the Memorandum of Agreement
entered into between the Applicant and the First Respondent
and
costs;
2.1 The First
Respondent should not be interdicted and restrained from making any
withdrawals from its bank account held at the
East London branch of
Nedbank, Vincent Park (the bank) under account number 1206 075 155
(the bank account) without the prior written
permission of the
Applicant.
2.2 The First
Respondent should not be directed to deposit into the bank account
all amounts it may receive as payment from the
Compensation Fund in
respect of the supply of toners and printer cartridges;
2.3 The Compensation
Fund should not be directed to deposit into the bank account all
amounts payable by it to the First Respondent
in respect of the
toners and printer cartridges which have and will be supplied to the
Compensation Fund in accordance with the
tender awarded to the First
Respondent by the Compensation Fund.
2.4 The Sheriff of the
above Honourable Court should not be authorised and directed to
attach all funds in the bank account.
2.5 The First
Respondent should not be directed to pay the costs of the
Application.”
[6] There is no clear indication from
the papers that the application was served on the second respondent
but the application was
nonetheless entertained as one of urgency and
a
rule nisi
issued in conformity with the relief foreshadowed
in the notice of motion. On 18 March 2011, the first respondent gave
notice of
its intention to oppose the application and filed its
answering affidavit on the return day. By agreement between the
parties the
matter was postponed to the 17
th
of May 2011
with directions as to the filing of further papers.
[7] The answering affidavit, in common
with the founding affidavit, lacks cohesion and is likewise not a
model of clarity. It raises
a dispute of fact but it is unnecessary
to deal with it or the founding affidavit in any detail for the
simple reason that the
first respondent, in contradistinction to its
earlier averments therein consented to an order being made
authorising the second
respondent to withhold an amount of R162 129,
97 standing to its credit in its banking account pending the
finalisation of the
proceedings. In the replying affidavit, the
deponent thereto,
Batty
, sought the dismissal of the first
respondent’s opposition to the application and confirmation of
the rule nisi only in the
amount of R162 791, 33. In amplification of
this narrowed ambit of the relief sought, he annexed a letter
addressed to the first
respondent’s manager wherein the
following agreement is recorded as follows:-
“
2.1
It is agreed that A K Communications is indebted to our client, Idea
Technologies (Pty) Ltd in the sum of R162 129, 97 and that
instructions are to be given to Nedbank to release the sum of R162
129, 97 and for the said sum to be transferred to the following
account:
Bank : First National
Bank
Account Name : Edward J
Batty
Branch Code : Private
Client, Port Elizabeth
258 612
Account Number : 622
788 650 38
2.2 It is further
agreed that in terms of the Court Order dated the 4
th
March 2011, the sum of R58 000, 00 is to be retained in the Nedbank
account until further notice.
2.3 It is a further a
term of the agreement that the balance in the said Nedbank account is
to be released to AK Communications.
[8] In argument before me, Mr
Sicengu
,
who argued in person, was constrained to concede that the first
respondent was lawfully indebted to the applicant in the sum of
R162
129, 97 and in effect consented to an order being made in terms of
which the second respondent was ordered to retain such
amount in its
banking account with the proviso that the first respondent be
permitted to otherwise operate its banking account.
The simple
solution would of course be for the first respondent to pay its
admitted liability to the applicant.
[9] It is apparent from the aforegoing
that the rule nisi must be confirmed with costs but its ambit
curtailed. In the result the
following order will issue:-
1. The rule nisi is confirmed to the
extent that the second respondent is directed to retain and pay over
to the applicant’s
designated banking account number 6227 886
5038 held at First National Bank under the name Edward J Batty,
branch code, Private
Client, Port Elizabeth 258 612 the amount of
R162 129, 97.
2. The first respondent is to pay the
costs of the application including the costs occasioned by the
postponement on 28 March 2011.
__________________
D. CHETTY
JUDGE OF THE HIGH COURT
Obo the Appellants: Adv Wood
Instructed by: Niehaus Mc Mahon, 13
Belgravia Crescent, Southernwood, East London, Tel: 043-743 3680
Obo the 1
st
Respondent:
Sitembiso Sicengu