About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Supreme Court of Appeal
SAFLII
>>
Databases
>>
South Africa: Supreme Court of Appeal
>>
2020
>>
[2020] ZASCA 78
|
|
Van Huyssteen and Others v Pepkor Speciality (Pty) Ltd and Another (334/2019) [2020] ZASCA 78 (30 June 2020)
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Not
reportable
Case
No: 334/2019
In
the matter between:
ABRAHAM
JOHANNES VAN HUYSSTEEN FIRST
APPELLANT
BERNARD
EUGENE
MOSTERT SECOND
APPELLANT
MICHAEL
BROWN THIRD
APPELLANT
GERT
CHRISTOFFEL
CLAASSENS FOURTH
APPELLANT
DAVID
VAN
NIEKERK FIFTH
APPELLANT
and
PEPKOR
SPECIALITY (PTY)
LTD FIRST
RESPONDENT
PEPKOR
HOLDINGS
LIMITED SECOND
RESPONDENT
Neutral
citation:
Van
Huyssteen and Others v Pepkor Speciality (Pty) Ltd and Another
(334/2019)
[2020] ZASCA 78
(30 June 2020)
Coram:
PETSE
DP and CACHALIA, VAN DER MERWE, MAKGOKA and MBATHA JJA
Heard:
14 May
2020
Delivered:
This
judgment was handed down electronically by circulation to the
parties' representatives by email, publication on the Supreme
Court
of Appeal website and release to SAFLII. The date and time for
hand-down is deemed to be 10h00 on 30 June 2020.
Summary:
Appeal
– whether interests of justice require determination of appeal
against interim order – absence of envisaged annexure
to order
– interpretation and effect of order – order sufficiently
clear – not meaningless or unjust –
matter struck from
the roll.
ORDER
On
appeal from:
Western
Cape Division of the High Court (Baartman J sitting as court of first
instance):
The matter is struck from
the roll with costs, including the costs of two counsel.
JUDGMENT
Van
der Merwe JA (Petse DP and Cachalia, Makgoka and Mbatha JJA
concurring)
[1]
What is the consequence of the absence of an envisaged annexure to
the order of the court below?
[1]
That is the issue that the parties presented to this court for
determination on appeal. As shall presently become apparent, however,
the anterior question is whether this court should entertain the
appeal. This question must be answered against the background
set out
below.
[2]
The first appellant, Mr Abraham Johannes van Huyssteen, was the
founder of a business known as Tekkie Town (the Tekkie Town
business). It was owned by Tekkie Town (Pty) Ltd. It mainly sold
branded footwear. The Tekkie Town business was particularly
successful
and by the middle of 2016 it operated more than 300 retail
stores. By then, the appellants had for some time formed the core
management
team of Tekkie Town (Pty) Ltd. Mr Van Huyssteen was its
chairman and the second appellant, Mr Bernard Eugene Mostert, was its
chief
executive officer. The third appellant, Mr Michael Brown, was
the chief procurement officer, the fourth appellant, Mr Gert
Christoffel
Claassens, its head of store merchandise and development
and the fifth appellant, Mr David van Niekerk, its chief operating
officer.
[3]
The shares in Tekkie Town (Pty) Ltd were held by various companies
(the former shareholders). The former shareholders were largely
controlled by Messrs Van Huyssteen, Claassens and Van Niekerk. On 29
August 2016, the former shareholders entered into an agreement
(the
exchange agreement) with Steinhoff International Holdings NV
(Steinhoff), a company incorporated in accordance with the laws
of
the Netherlands. In terms of this agreement, the former shareholders,
in essence, exchanged all their shares in and claims against
Tekkie
Town (Pty) Ltd for 43 million shares in Steinhoff, valued at
R3 257 250 000.
[4]
The appellants were collectively referred to in the exchange
agreement as the key management of Tekkie Town (Pty) Ltd. It was
a
suspensive condition of the exchange agreement that each of the
appellants conclude a written service agreement with Tekkie Town
(Pty) Ltd, for a minimum employment term of five years. In terms of
the condition these agreements had to include confidentiality
and
restraint provisions that had to subsist during the employment of the
appellants as well as for a period of three years from
the date of
cessation thereof. As each of the appellants had existing employment
agreements with Tekkie Town (Pty) Ltd, the suspensive
condition was
fulfilled by them entering into addenda to their employment
agreements.
[5]
Each addendum, entered into on 14 September 2016,
inter alia
provided as follows:
‘
Your contract of employment
will be amended to a Fixed Term Contract effective 1 September 2016
to 30 September 2021. Your one month
notice period as per your
current employment contract will no longer apply.
In addition, it is agreed that there
will be a 3 (three) year Restraint of Trade from the last day of your
employment (be it through
dismissal or your contract expiring.) The
restraint is as defined in the Steinhoff Sale of Shares and Claims
agreement and covers
any retail or commercial activities in which
Steinhoff may have a direct or indirect interest.’
The
addenda referred to clause 16 of the exchange agreement. This clause
contained an extensive covenant in restraint of trade.
In this manner
each appellant, in essence, undertook not to be interested in or
concerned with any business in South Africa or
Namibia which is
competitive with or similar to the Tekkie Town business, for a period
of three years following on the last day
of his employment.
[6]
Subsequent to the execution of the exchange agreement, Steinhoff
transferred the shares in Tekkie Town (Pty) Ltd to the second
respondent, Pepkor Holdings Limited (Pepkor). Tekkie Town (Pty) Ltd
therefore became a wholly owned subsidiary of Pepkor. With
effect
from 1 October 2017, Tekkie Town (Pty) Ltd sold and transferred the
Tekkie Town business to the first respondent, Pepkor
Speciality (Pty)
Ltd (Speciality), as a going concern. The Tekkie Town business thus
became a division of Speciality, which apparently
rendered Tekkie
Town (Pty) Ltd an empty shell. As a result of these developments, the
employment contracts of the appellants were
transferred to Speciality
in terms of
s 197
of the
Labour Relations Act 66 of 1995
.
[7]
On 11 May 2018 the former shareholders issued summons in the Western
Cape Division of the High Court of South Africa (the high
court)
against Steinhoff. They essentially alleged that the exchange
agreement had been induced by the misrepresentations of the
chief
executive officer of Steinhoff which, to his knowledge, were false.
They claimed redelivery of the shares in and claims to
Tekkie Town
(Pty) Ltd, alternatively the value thereof.
[8]
The appellants remained in charge of the management of the Tekkie
Town business within Speciality until approximately the middle
of
2018. Mr Van Huyssteen’s employment with Speciality was
terminated on 24 May 2018. On 25 June 2018 the rest of the
appellants,
together with many other former employees of Tekkie Town
(Pty) Ltd, resigned from their employment with Speciality.
[9]
It is common cause that the appellants have since been involved in
the operation of a business under the name of Mr Tekkie.
The
respondents’ case is that Mr Tekkie competes directly with the
Tekkie Town business. As a result, they approached the
high court
during September 2018 for an order enforcing the restraint of trade
covenants, pending an action for final relief to
be instituted by the
respondents.
[10]
In terms of the notice of motion the respondents sought extensive
relief. During argument in the court a quo (Baartman J),
however, the
respondents claimed the relief set out in a draft order that they had
presented to the court. The draft order envisaged
that the appellants
would be interdicted and restrained from being interested in or
concerned with any business that stocks, or
offers for sale, the
footwear that the respondents proposed would be listed in annexure A
thereto. In terms of the draft order,
the parties would also be
directed to treat annexure A thereto as confidential.
[11]
Such a list did not form part of the papers in the application, nor
was it annexed to the draft order. In order to explain
this, the
respondents placed a transcript of the oral argument in the court a
quo before this court, without objection from the
appellants.
It appears from the
transcript that the respondents initially intended that
annexure A to
the draft order would constitute a list of the footwear that the
Tekkie Town business stocked, or offered for sale,
at the time of the
argument in the court a quo. This took place on 30-31 October 2018.
During the respondents’ reply, the
court a quo directed that
the proposed list be made available to the appellants by 15h00 on
that day (31 October 2018), with
the understanding that the
appellants had until 10h00 on the following day to respond thereto.
During further argument the court
a quo directed the respondents to
provide two lists, that is, the list that the respondents had
proposed, as well as a list of
the footwear that the Tekkie Town
business had stocked, or offered for sale, on the effective date of
the exchange agreement, namely
1 October 2016. Counsel for
the respondents indicated that it might not be possible to provide
the second proposed list
by 15h00.
[12]
Whether such lists were made available to the appellants does not
appear from the record and this question is apparently in
serious
dispute. They were not, however, provided to the court a quo. The
reason for this appeared from what counsel for the respondents
had
said towards the end of his reply. He submitted that there were three
proposed lists that could constitute annexure A to the
draft order,
depending on what the findings of the court a quo would be. These
were, first, a list of the footwear that had been
stocked, or offered
for sale, by the Tekkie Town business on 31 October 2018,
second, a list of the footwear that the
Tekkie Town business would,
according to its order book, stock, or offer for sale, during June
2019 and, third, a list of the footwear
that it had stocked, or
offered for sale, on 1 October 2016. He concluded as follows:
‘
And then the Annexure A will be
what M’Ladyship may order is the appropriate date. So it’s
not annexed, but we will
deliver it in response to M’Ladyship’s
order if any be made.’
This
statement did not elicit comment from the court a quo nor objection
from the appellants.
[13]
On 7 November 2018 the court a quo handed down its judgment. It held
that the respondents had made a proper case for an interim
interdict
pending an action to be instituted for a final interdict. It made an
order in accordance with the draft order of the
respondents in the
following terms:
‘
(a) The non-compliance by
Applicants with the Rules relating to form and service is condoned,
and this application is heard as one
of urgency in terms of Uniform
Rule 6(12).
(b) The trial of the action to
be instituted shall be heard as an expedited trial on dates to be
agreed between the parties
in consultation with the Judge President.
(c) Until the conclusion of the
trial, or until any further Order by a Court, the First to Fifth
Respondents, and each of
them, are interdicted and restrained from
being interested in, or concerned with, any business which, anywhere
within South Africa
or Namibia, stocks, or offers for sale, the
footwear listed on annexure “A” hereto. [footwear that
existed as at 1
October 2016 and before]
(d) The parties are directed to
keep annexure “A” confidential as between them.
(e) Costs of 30 October 2018,
including the costs of two counsel.’
[14]
As I have indicated, no annexure was attached to the order. The
action referred to in para (b) thereof, had in the meantime
been
instituted on 5 November 2018. The costs order in para (e) was made
in favour of the respondents, the court having concluded
that each
party should pay its own costs in respect of the hearing on 31
October 2018.
[2]
[15]
In their application for leave to appeal filed on 19 November 2018,
the appellants mainly relied thereon that no list had been
made
available to them or to the court. In its judgment on the application
for leave to appeal, the court a quo gave a full exposition
of what
had been said in respect of the proposed lists (as set out in paras
11 and 12 above) and stated:
‘
I did not hear from the parties
in respect of the arrangement with the list. I accepted, erroneously
so, that the list had been
exchanged and that the respondents were
satisfied that it contained the shoes relevant to each period.’
It
is quite clear that the court a quo accepted the proposal of the
respondents and contemplated that it would subsequent to the
delivery
of the judgment be provided with the appropriate list, depending on
its findings in respect thereof, but on the understanding
that the
lists had been made available to the appellants.
[16]
On 4 March 2019 the court a quo granted leave to the appellants to
appeal to this court. We were informed from the bar that
in the
meantime, on 11 December 2018, the respondents had launched
an application in terms of Uniform
Rule 42
in the high court. The
notice of motion in that application was placed before us with the
leave of my brother presiding, Petse
DP. It included the following
prayer:
‘
That the ambiguity in paragraph
(c) of the order be cured by a declaration that the Annexure “A”
referred to therein
is the document annexed thereto marked “X”,
being a detailed list of the footwear items stocked and/or offered
for
sale by Tekkie Town as at 1 October 2016 and before.’
We
were also informed from the bar that this application had been
dismissed by Baartman J, but that is the full extent of our knowledge
in this regard.
[17]
As I have said, the first order of business is to determine whether
the order of the court a quo is susceptible to appeal.
In an
oft-quoted passage, Harms AJA, writing for the court, stated in
Zweni
v Minister of Law and Order
[1993] (1) All SA 365
(A);
1993 (1)
SA 523
(A) at 532I-533A:
‘
A "judgment or order"
is a decision which, as a general principle, has three attributes,
first, the decision must be final
in effect and not susceptible of
alteration by the court of first instance; second, it must be
definitive of the rights of the
parties; and, third, it must have the
effect of disposing of at least a substantial portion of the relief
claimed in the main proceedings’.
As
is apparent from this passage, it did not purport to be exhaustive of
the matter. See also
Moch
v Nedtravel (Pty) Ltd t/a American Express Travel Service
1996
(3) SA 1
(A) at 10F.
[18]
In
S v
Western Areas Ltd and Others
[2005]
3 All SA 541
(SCA);
2005 (5) SA 214
(SCA), this court had occasion to
consider the issue of appealability in accordance with the prescripts
of s 39(2) of the Constitution.
[3]
Howie P concluded as follows at para 28:
‘
I am accordingly of the view
that it would accord with the obligation imposed by s 39(2) of the
Constitution to construe the word
“decision” in s 21(1)
of the Supreme Court Act to include a judicial pronouncement in
criminal proceedings that is
not appealable on the
Zweni
test but one which the interests of justice require should
nevertheless be subject to an appeal before termination of such
proceedings.
The scope which this extended meaning could have in
civil proceedings is unnecessary to decide. It need hardly be said
that what
the interests of justice require depends on the facts of
each particular case.’
This
dictum
clearly applies with equal force to the word ‘decision’
in the successor to s 21(1) of the Supreme Court Act 59
of 1959,
namely
s 16(1)
of the
Superior Courts Act 10 of 2013
.
[4]
[19]
In
Philani-Ma-Afrika
and Others v Mailula and Others
[2009]
ZASCA 115
;
[2011] 1 All SA 459
(SCA);
2010 (2) SA 573
(SCA) para 20,
this court further developed the law in this regard by applying the
reasoning in
Western
Areas
to
a civil matter. It said that ‘what is of paramount importance
in deciding whether a judgment is appealable is the interests
of
justice’. It bears emphasis that what the interests of justice
require is not determined by a closed list of considerations
and
depends on the relevant facts and circumstances of each individual
case.
[20]
The appellants rightly accepted that the matter is not appealable
under the
Zweni
test. It is an interim order that did not finally determine rights
nor any portion of the relief claimed in the action. It follows
that
the question is whether the interests of justice nevertheless require
the intervention of this court on appeal.
[21]
The appellants confined their argument in this regard to the
contention that the absence of annexure A rendered the order of
the
court a quo meaningless and unjust. The appellants referred us to the
judgments of this court in
Minister of Home Affairs and Others v
Scalabrini Centre and Others
[2013] ZASCA 134
;
[2013] 4 All SA
571
;
2013 (6) SA 421
(SCA) para 77 and
Minister of Water and
Environmental Affairs v Kloof Conservancy
[2015] ZASCA 177
;
[2016] 1 All SA 676
(SCA) para 13. In
Scalabrini
Nugent JA
said:
‘
Moreover, litigants who are
required to comply with court orders, at the risk otherwise of being
in contempt if they do not, must
know with clarity what is required
of them.’
The
appellants relied heavily on the apparent recognition by the
respondents in the
rule 42
application that the order was ambiguous.
Their further lament was that it would be manifestly unjust for the
appellants to face
proceedings for contempt of court in respect of
obligations that are uncertain and unclear.
[22]
Whether the order of the court a quo is sufficiently clear, depends
on an interpretation thereof. It is trite that the court’s
intention is to be ascertained by a construction of the order in
accordance with the usual well-known rules. See
Firestone
South Africa (Pty) Ltd v Gentiruco AG
[1977]
4 All SA 600
(A);
1977 (4) SA 298
(A) at 304D-E. This entails giving
meaning to the words used within the context in which they were used,
including the apparent
purpose of the order. The reasons for the
order provide the essential context thereof. It follows that the view
reflected in the
notice of motion in the
rule 42
application, is of
no moment.
[23]
After having dealt with all the arguments that had been raised, the
court a quo in its judgment clearly held that the appellants
should
be interdicted and restrained from being interested in or concerned
with any business that stocks, or offers for sale, the
footwear that
the Tekkie Town business stocked or offered for sale on 1 October
2016. With reference to para (c) of the draft order
and the
provisions of the exchange agreement, the judgment concluded:
‘
[47] The draft order, paragraph
C, provides for a list containing the footwear subject to the
restraint. Various dates were canvassed.
The relevant section
provides:
“
16.1.4
…utilise or directly or indirectly divulge or disclose or make
available to any person, any of the intellectual property,
know-how
or confidential information of the Business existing as at the
effective Date or prior thereto.
”
[48] The effective date is 1 October
2016. I have considered that prior to that date, the respondents have
employed entrepreneurial
skill, talent and have achieved much
success. They provide much needed employment. They should not be
hampered in their economic
activity beyond the effective date.’
[24]
In the judgment granting leave to appeal, the court a quo rightly
said:
‘
I finalised judgment and made
an order restraining the respondents from “being interested in,
…footwear that existed
as at 1 October 2016 and before.”
As indicated above, that list of footwear was available. It is
apparent from the judgment
that the respondents, who had set up
Tekkie Town and managed it after it was sold to the applicants would
have had intimate knowledge
of the shoes that Tekkie Town sold in
October 2016.’
As
a matter of logic and in its context, para (c) of the order could not
relate to footwear that the Tekkie Town business had discontinued
prior to 1 October 2016 and all references to the list during
argument and in the judgments were made on this basis.
[25]
In context, para (c) of the order conveys with sufficient clarity
what it requires of the appellants, namely to refrain from
being
interested in or concerned with any business that stocks, or offers
for sale, the footwear that the Tekkie Town business
stocked or
offered for sale on 1 October 2016. The addition of annexure A could
not alter this meaning, it would only provide greater
specificity.
[26]
It is trite that civil contempt of court consists of wilful and
mala
fide
disobedience of a court order. Even though proof of non-compliance
with an order places an evidential burden on a respondent in
respect
of the elements of wilfulness and
mala
fides
,
the applicant must prove all the requirements of contempt of court
beyond reasonable doubt. See
Fakie
NO v CCII Systems (Pty) Ltd
[2006]
ZASCA 52
;
2006 (4) SA 326
(SCA) para 42.
[27]
In this case the first requirement for a committal of the appellants
for contempt of the order of the court a quo, would be
proof beyond
reasonable doubt that the appellants caused Mr Tekkie to stock, or
offer for sale, the footwear that the Tekkie Town
business had
stocked or offered for sale on 1 October 2016. Annexure A to the
order could have facilitated such proof. In its absence,
the
respondents would bear the full onus of proving this beyond
reasonable doubt. As the appellants would probably be in a better
position than the respondents to determine this, I can see no real
possibility of injustice.
[28]
In the result the order of the court a quo is neither meaningless nor
unjust. It follows that the appellants’ reliance
on the
interests of justice was without foundation.
[29]
There is a further consideration that illustrates that the interests
of justice do not favour the determination of an appeal
against the
interim order. During argument counsel for the appellants was asked
to formulate the order that the appellants would
seek in the event of
the appeal succeeding on this point. He responsibly found himself
unable to suggest that in that event the
respondents’
application had to be dismissed. Instead, he proposed that para (c)
of the order be set aside and the matter
be left at that,
alternatively that it be referred to the court a quo for
reconsideration of para (c). But the primary proposal
would result in
an inchoate order and, in respect of the alternative proposal, the
interests of justice would clearly be better
served by the
determination of this issue at the expedited trial.
[30]
One final matter remains. I do not think that it would be unfair to
say that the court a quo granted leave to appeal because
it was
unable to find a solution for the apparent or alleged failure of the
respondents to make the proposed lists available to
the appellants.
In granting leave to appeal to this court, the court a quo referred
to para 48 of the judgment on the merits (quoted
in para 23 above)
and concluded:
‘
It is unclear whether that
purpose will be achieved amid the current confusion. In the
circumstances of this matter, it must be
in the interest of justice
to grant leave to appeal.’
[31]
But that was no reason to grant leave to appeal, let alone to this
court. Leave to appeal could only have been granted in terms
of
s
17(1)
of the
Superior Courts Act.
[5]
In the absence of a determination in terms of
s 17(6)
of
the
Superior Courts Act that
the matter required the attention of
this court, leave to appeal had in any event to be given to the full
court. Despite the difficulties
presented by the conduct of the
parties, these provisions had to be applied.
[32]
In this case, as I have said, the court a quo contemplated the
supplementation of its order with the appropriate list. There
was
accordingly no reason for it not to do so, after hearing further
argument if that was required, on the basis of the exception
to the
functus
officio
principle
set out in
Firestone
South Africa (Pty) Ltd v Gentiruco AG
,
supra at 306H, namely that an order may be supplemented in respect of
accessory or consequential matters. If that proved not to
be
possible, the court a quo had to grasp the nettle and interpret its
order in the manner set out in this judgment.
[33]
For these reasons this court should decline to determine the appeal.
Even though the respondents employed three counsel, they
sought the
costs of two counsel only.
[34]
The matter is struck from the roll with costs, including the costs of
two counsel.
_______________________
C
H G VAN DER MERWE
JUDGE
OF APPEAL
APPEARANCES
For
appellants: W R E Duminy SC and N Traverso (heads prepared by D F
Irish SC, W R E Duminy SC and N Traverso)
Instructed
by: Webber Wentzel Attorneys, Cape Town
Symington
De Kok Attorneys, Bloemfontein
For
respondents: L Kuschke SC, A M Smalberger SC and R M G Fitzgerald
Instructed
by: Bowman Gilfillan Attorneys, Cape Town
Matsepes
Inc , Bloemfontein
[1]
The order is fully set out in para 13
below.
[2]
No order was made as to the costs of
the application; it did not appear from the judgment whether this
was by design or inadvertently.
[3]
Section 39(2) of the Constitution of
the Republic of South Africa, 1996:
‘
When interpreting any
legislation, and when developing the common law or customary law,
every court, tribunal or forum must promote
the spirit, purport and
objects of the Bill of Rights.’
[4]
Section 16(1)
of the
Superior Courts
Act 10 of 2013
:
‘
16. Appeals generally
(1) Subject to
section 15(1)
, the
Constitution and any other law –
(a)
an appeal against any decision of a Division as a court of first
instance lies, upon leave having been granted –
(i) if the court consisted of a
single judge, either to the Supreme Court of Appeal or to a full
court of that Division, depending
on the direction issued in terms
of section 17 (6); or
(ii) if the court consisted of more
than one judge, to the Supreme Court of Appeal;
(b)
an
appeal against any decision of a Division on appeal to it, lies to
the Supreme Court of Appeal upon special leave having been
granted
by the Supreme Court of Appeal; and
(c)
an appeal against any decision of a court of a status similar to the
High Court, lies to the Supreme Court of Appeal upon leave
having
been granted by that court or the Supreme Court of Appeal, and the
provisions of section 17 apply with the changes required
by the
context.’
[5]
Section 17(1)
of the
Superior Courts
Act:
‘
17. Leave to appeal
(1) Leave to appeal may only be given
where the judge or judges concerned are of the opinion that –
(a) (i) the appeal would have a
reasonable prospect of success; or
(ii) there is some other compelling
reason why the appeal should be heard, including conflicting
judgments on the matter under
consideration;
(b) the decision sought on appeal
does not fall within the ambit of
section 16(2)
(a)
;
and
(c) where the decision sought to be
appealed does not dispose of all the issues in the case, the appeal
would lead to a just and
prompt resolution of the real issues
between the parties.’