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2024
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[2024] ZALMPPHC 96
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Schoeman and Another v Big 5 Security Company Wihon 25 CC and Others (7093/2024) [2024] ZALMPPHC 96 (6 August 2024)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
LIMPOPO
DIVISION, POLOKWANE
CASE
NO: 7093/2024
(1)
REPORTABLE: YES/NO
(2)
OF INTEREST TO THE JUDGES: YES/NO
(3)
REVISED
In
the matter between:
FRANCIS
SCHOEMAN
First Applicant
MESSINA BIG 5 ALARMS
AND CCTV
t/a 1ST DEFENCE ARMED
RESPONSE
Second Applicant
(Registration Number:
2020/511835/07)
and
BIG 5 SECURITY COMPANY
WIHON 25 CC
First Respondent
(REG. NO:
2002/086248/23)
PIET VAN DER
WESTHUIZEN
Second Respondent
STEPHANUS
GEYER
Third Respondent
JUDGEMENT
GAISA
AJ
INTRODUCTION
[1]
This is an urgent application brought by
the Applicants seeking relief against the Respondents relating to a
security services business.
The matter involves somewhat complex
factual and legal issues surrounding the sale of a business,
contractual obligations, and
allegations of interference with
business operations.
[2]
The Applicants seek the following main
relief:
2.1.
an order enforcing a sale of shares
agreement dated 1 July 2022;
2.2.
the return of certain GPRS radios;
2.3.
an interdict prohibiting the Respondents
from contacting the Applicants' clients.
[3]
The First and Second Respondents oppose the
application. The Third Respondent has not filed any opposing papers.
BACKGROUND
[4]
On 1 July 2022, the First Applicant entered
into a written sale of shares agreement to purchase the Second
Applicant (then known
as Messina Big 5 Alarms and CCTV) from the
Third Respondent. The Third Respondent was then a director of both
the Second Applicant
and the First Respondent (Wihon 25 CC).
[5]
A key term of the agreement was that the
First Respondent would "exclusively" provide monitoring
services for the Second
Applicant's clients at a specified rate. The
Applicants argued that the agreement also provided for the transfer
of 50 GPRS monitoring
radios to the Second Applicant upon full
payment of the purchase price.
[6]
In March/April 2023, the Second Respondent
purchased the First Respondent from the Third Respondent.
[7]
On 2 July 2024, the First Respondent sent a
letter to the Applicants terminating all services between the parties
effective 1 August
2024.
[8]
The Applicants allege that since April
2023, the Respondents have been interfering with their business
operations, contacting their
clients directly, and removing GPRS
radios. They claim this conduct breaches the sale agreement and is
causing irreparable harm
to their business.
[9]
The Respondents deny any unlawful conduct.
They contend that the First Respondent is not bound by the sale
agreement, that the GPRS
radios belong to the First Respondent, and
that they have lawfully terminated their business relationship with
the Applicants.
ISSUES FOR
DETERMINATION
[10]
The key issues for determination are:
10.1.
whether the matter is urgent;
10.2.
whether the 1 July 2022 sale agreement
binds the First Respondent;
10.3.
whether the Applicants have proven
ownership of the GPRS radios;
10.4.
whether the Applicants have established
grounds for an interdict;
10.5.
the admissibility and weight of certain
evidence; and
10.6.
costs.
URGENCY
[11]
The Applicants contend that this matter is
extremely urgent due to alleged ongoing interference with their
business and the impending
termination of services on 1 August 2024.
[12]
Regarding
the purpose of rule 6(12), Norman Manoim
[1]
said:
“
The
judicial system, not unlike the private individual, does not take
kindly to people who push to the front of the queue. The doctrine
of
urgency was developed and encapsulated in the rules of court in order
to allow those for whom the wait in the queue would not
be worth it
unless they push in front, to do just that without attracting dirty
looks from those behind them.
”
[13]
The
test for urgency is well-established. In
Luna
Meubel Vervaardigers (Edms) Bpk v Makin,
[2]
Coetzee J said:
“
Practitioners
should carefully analyse the facts of each case to determine, for the
purposes of setting the case down for hearing,
whether a greater or
lesser degree of relaxation of the Rules and of the ordinary practice
of the Court is required. The degree
of relaxation should not be
greater than the exigency of the case demands. It must be
commensurate therewith. Mere lip service
to the requirements of Rule
6(12)(b) will not do and an applicant must make out a case in the
founding affidavit to justify the
particular extent of the departure
from the norm, which is involved in the time and day for which the
matter be set down
.”
[3]
[14]
I have serious concerns about the urgency
of this application:
[15]
The Applicants allege interference with
their business since April 2023, yet only brought this application in
July 2024, over a
year later.
[16]
The termination letter provides a month's
notice until 1 August 2024, which is a reasonable period.
[17]
The extremely truncated timelines imposed
on the Respondents (less than 24 hours to file an answering
affidavit) are not adequately
justified.
[18]
The Applicants have not demonstrated
imminent irreparable harm that cannot be addressed through normal
court procedures.
[19]
Many of the Applicants' allegations about
client losses and business interference lack concrete evidence.
[20]
It appears that any urgency in this matter
is largely self-created due to the Applicants' delay in bringing the
application. The
principle that a party cannot rely on self-created
urgency is well-established in our law.
[21]
Furthermore, the Applicants have not
adequately explained why they cannot obtain substantial redress
through normal court procedures.
Their main complaint relates to
potential financial losses, which our courts have held is generally
not sufficient grounds for
urgency.
[22]
In
I
L & B Marcow Caterers (Pty) Ltd v Greatermans SA Ltd &
another; Aroma Inn (Pty) Ltd v Hypermarket (Pty) Ltd &
another
,
[4]
Fagan J stated:
“
It
is clear from the requirements set out in Rules 27 and 6(12) that the
Court's power to abridge the times prescribed and to accelerate
the
hearing of the matters should be exercised with judicial discretion
and upon sufficient and satisfactory grounds being shown
by the
applicants. The major considerations normally and in these two
applications are three in number, viz the prejudice that
applicants
might suffer by having to wait for a hearing in the ordinary course;
the prejudice that other litigants might suffer
if the applications
were given preference; and the prejudice that respondents might
suffer by the abridgment of the prescribed
times and an early
hearing.
”
[23]
Later
in the judgment, the learned judge, with reference to prejudice to
other litigants in general, held that the issue boiled
down to
whether the harm alleged by an applicant in an urgent application was
the kind of harm that justified “
the
disruption of the roll and the resultant prejudice to other members
of the litigating public”
whose matters would take longer to be heard.
[5]
[24]
For these reasons, I find that the
Applicants have failed to establish that this matter is truly urgent.
However, given the full
arguments presented by both parties, I will
proceed to consider the merits of the application.
ENFORCEABILITY OF
THE SALE AGREEMENT AGAINST THE FIRST RESPONDENT
[25]
The Applicants seek to enforce the terms of
the 1 July 2022 sale agreement against the First Respondent,
particularly the provision
for exclusive monitoring services.
[26]
It is trite law that only parties to a
contract are bound by its terms. The evidence before me clearly shows
that the First Respondent
was not a signatory to the sale agreement.
The agreement was between the First Applicant and the Second
Applicant (represented
by the Third Respondent).
[27]
The Applicants argue that because the Third
Respondent was a director of both the Second Applicant and the First
Respondent at the
time, the First Respondent is bound. This argument
is flawed. There is no evidence that the Third Respondent was
authorized to
bind the First Respondent to the agreement. A company
is a separate legal entity from its directors and members.
[28]
The
Applicants' reliance on the case of
Oakland
Nominees (Pty) Ltd v Gelria Mining & Investment Co Ltd
[6]
is misplaced. That case dealt with the ownership of shares
after a share certificate was stolen, which is not analogous to
the
present situation.
[29]
Even if there was a separate agreement
between the Applicants and the First Respondent regarding monitoring
services, this would
be distinct from the sale agreement. The First
Respondent would be entitled to terminate such an agreement on
reasonable notice,
which they have done.
[30]
For these reasons, I find that the First
Respondent is not bound by the terms of the 1 July 2022 sale
agreement. The Applicants'
prayer for specific performance against
the First Respondent cannot succeed.
OWNERSHIP OF GPRS
RADIOS
[31]
The Applicants seek the return of 50 GPRS
monitoring radios, which they claim were sold to them as part of the
business purchase.
[32]
The evidence before me shows that:
32.1.
the GPRS radios are registered in the name
of the First Respondent;
32.2.
the First Respondent pays all fees and
expenses related to the radios;
32.3.
the radios are connected to the First
Respondent's base station.
[33]
While the sale agreement does mention the
transfer of 50 GPRS radios upon full payment, this term was between
the Applicants. The
First Respondent was not a party to this
agreement.
[34]
Furthermore, the Applicants have not
identified which specific radios they claim ownership of, nor have
they provided concrete evidence
that the Respondents have taken any
radios belonging to them.
[35]
On the evidence before me, I cannot
conclude that the Applicants have proven ownership of the GPRS radios
in question. Their claim
for the return of these radios must
therefore fail.
INTERDICT
[36]
The Applicants seek an interdict
prohibiting the Respondents from contacting their clients directly or
indirectly.
[37]
The requirements for a final interdict are
well-established:
37.1.
a clear right;
37.2.
an injury actually committed or reasonably
apprehended;
37.3.
the absence of any other satisfactory
remedy.
[38]
The Applicants have failed to establish
these requirements:
[39]
They have not demonstrated a clear right to
prevent the Respondents from communicating with clients. The First
Respondent is not
bound by the non-solicitation terms of the sale
agreement.
[40]
The evidence of actual injury is largely
based on hearsay and unsubstantiated allegations. Many of the clients
the Applicants claim
to have lost appear to have terminated services
long before the alleged interference.
[41]
The Applicants have other remedies
available, including a claim for damages (which they state they
intend to pursue).
[42]
For these reasons, the Applicants have not
established grounds for the interdict sought.
ADMISSIBILITY AND
WEIGHT OF EVIDENCE
[43]
I must address serious concerns about
certain evidence presented by the Applicants, particularly in their
replying affidavit.
[44]
The Applicants attached three unsigned
letters which they rely on to substantiate their allegations. There
are significant issues
with these letters:
[45]
A letter purportedly from the First
Respondent dated 5 July 2024 is denied by the alleged author, Ms.
Leoni Botha. The Applicants
have not explained why this letter was
not included in their founding papers if it existed prior to the
application.
[46]
A letter supposedly from AAA Security
terminating services is contradicted by evidence from the purported
author, Mr. S. Naidoo,
who provides a different termination letter
with an earlier date.
[47]
A letter from "The Brave Security"
is unsigned and its provenance unexplained.
[48]
These discrepancies raise serious doubts
about the authenticity of these documents. The Applicants have not
adequately addressed
the origin of these letters or how they came
into their possession.
[49]
Considering
these issues, and applying the principles in section 15(3) of the
Electronic Communications and Transactions Act,
[7]
I find that little to no weight can be attached to these disputed
letters.
[50]
This finding significantly undermines the
Applicants' allegations of interference with their business and
client relationships.
COSTS
[51]
The general rule is that costs follow the
result. However, the court has a discretion to make a different order
where the circumstances
warrant it.
[52]
In this case, the Respondents have sought a
punitive costs order on an attorney and client scale. They argue that
the Applicants'
conduct has been vexatious and that they have
attempted to mislead the court with fraudulent documents.
[53]
While I have found against the Applicants
on the merits, and have serious concerns about some of the evidence
presented, I am not
persuaded that their conduct rises to the level
warranting a punitive costs order. The issues in this case were
complex, and while
the urgency was not established, I do not find
that the application was brought in bad faith.
CONCLUSION
[54]
For the reasons set out above:
1.
The application is dismissed.
2.
The Applicants are ordered to pay the costs
of the First and Second Respondents on a party and party scale.
GAISA
AJ
ACTING
JUDGE: HIGH COURT
POLOKWANE:
LIMPOPO DIVISION
APPEARANCES
FOR
THE APPELLANT:
Ms
MG MAHASHA
INSTRUCTED
BY:
MG
MAHASHA AND ASSOCIATES INC.
FOR
1
st
& 2
nd
RESPONDENTS:
ADV
SS GREEN
INSTRUCTED
BY:
CHARLES
PIETERSE ATTORNEYS
DATE
OF HEARING:
18
JULY 2024
DATE
OF JUDGEMENT:
6
AUGUST 2024
[1]
Norman
Manoim ‘Principles Regarding Urgent Applications’ in
Nicholas Haysom and Laura Mangan (eds) Emergency
Law at
79.
[2]
1977
(4) SA 135 (W)
[3]
Luna
Meubel
supra
136C-137G
[4]
I
L &B Marcow Caterers (Pty) Ltd v Greatermans SA Ltd &
another; Aroma Inn (Pty) Ltd v Hypermarket (Pty) Ltd &
another
1981
(4) SA 108
(C) at 112H-113A.
[5]
I
L &B Marcow Caterers
supra
at
114A-B
[6]
1976
(1) SA 441 (A)
[7]
Act
25 of 2002