IN THE HIGH COURT OF SOUTH AFRICA
EASTERN CAPE DIVISION, G QEBERHA
Case No.: 1447/2022
Date Heard: 21 November 2024
Date Delivered: 18 February 2024
In the matter between:
SPECTRUM LOGISTICS (PTY)LTD Plaintiff
and
KAROO TREATS CC t/a JFM LOGISTICS Defenda nt
JUDGMENT
RONAASEN AJ
Introduction
[1] In May 2022 the plaintiff instituted action against the defendant for payment of the sum
of R814 775.00 and interest on that sum in respect of transport services allegedly
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rendered by the plaintiff to the defendant pursuant to a written agreement concluded
between them in June 2019, entitled “ Facility Agreement”.
[2] The defendant has defended the action and instituted a claim in reconvention.
[3] In its plea, the defendant admits the conclusion of the “Facility Agreement” and that
the plaintiff had rendered transport services to it over the period alleged by the plaintiff,
namely December 2021 to March 2022.
[4] In terms of its claim in reconvention the defendant seeks payment from the plaintiff of
the sum of R3 646 748.48 for damages in the form of a loss of profits, against the
following background:
4.1. in May 2020 , the plaintiff as subcontractor, and the defendant as principal
contractor concluded a written subcontracting agreement ;
4.2. the subcontracting agreement was concluded subsequent to the conclusion of
the “Facility Agreement” and thus, according to the defendant, superseded the
“Facility Agreement” ;
4.3. in terms of the subcontracting agreement, inter alia :
4.3.1. the plaintiff undertook to maintain, at all times, the highest degree of
good faith to the defendant and to avoid any conflict of interest arising
between them;
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4.3.2. the failure by the plaintiff to advise the defendant of any conflict of
interest would amount to a material breach of the subcontracting
agreement;
4.3.3. the plaintiff acknowledged that during the subsistence of the
subcontracting agreement and in the course of its performance of its
obligations in terms thereof it would gain access to and acquire
knowledge of various aspects of the defendant’s business , which were
collectively referred to as its “confidential information”; and
4.3.4. the plaintiff undertook, for the duration of the subcontracting
agreement as well as after its termination, not to utilise the defendant’s
confidential information for its benefit ;
4.4. in March 2022 the plaintiff employed one Roland Barrath (“the employee”) who,
until 28 February 2022, had been employed by the defendant since October
2019;
4.5. the employee played a crucial management role in the operations of the
defendant;
4.6. by virtue of his position in the defendant’s structure the employee had access
to very confidential information regarding the defendant’s operations ;
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4.7. the plaintiff, by employing the employee, and utilising his knowledge of the
defendant’s confidential information resulted in the plaintiff gaining an unfair
advantage against the defendant and thereby breach ed the terms of the
subcontracting agreement by failing to maintain the highest degree of good
faith towards the defendant, allowing a conflict of interest to materialise
between the plaintiff and the defendant and failing to advise the defendant
immediately of such conflict ; and
4.8. thus, the plaintiff was in material breach of the subcontracting agreement by
misusing the defendant’s confidential information gained from employing the
employee, resulting in a loss of profits and the defendant suffering damages in
the sum claimed from the plaintiff .
[5] The plaintiff has pleaded to the claim in reconvention , denying any liability to the
defendant for the payment of damages.
[6] The interlocutory dispute which I am required to determine, revolves entirely around
the claim in reconvention .
Summary of the interlocutory dispute
[7] During May 2024 the plaintiff delivered a the following documents:
7.1. a notice in terms of Uniform Rule 35(3) (“the notice”) ; and
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7.2. a request for particulars for trial (“the request”).
[8] According to the plaintiff the pr esent interlocutory application was prompted by the
defendant’s alleged failure to respond:
8.1. to the notice; and
8.2. sufficiently to the request .
[9] In terms of its notice of motion the plaintiff, in summary, seeks relief in the form of
orders directing the defendant to :
9.1. “comply with the provisions of ” certain paragraphs in the notice (to which I
shall revert, below); and
9.2. “provide proper responses to the enquiries ” contained in identified paragraphs
in the request (to which I shall also revert, below).
Discussion of relevant legal principles and their application to this matter
The notice
[10] Rule 35(3) (“the rule”) provides as follows:
If any party believes that there are, in addition to documents or tape recordings disclosed as
aforesai d, other documents ( including copies thereof) or tape recordings which may be relevant
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to any matter in question in the possession of any party thereto, the former may give notice to
the latter requiring such party to make the same available for inspection in accordance with
subrule (6), or to state on oath within 10 days thereof that such documents or tape recordings
are not in such party’s pos session , in which event the party making the disclosure shall state
their whereabouts, if known.
[11] The clear intention of the rule is to ensure the availability to a party of documents which
are relevant issue in dispute between the parties.
[12] A discovery affidavit delivered by a party to an action is ordinarily conclusive unless it
can be shown from the discovery affidavit itself, from the documents listed in the
discovery affidavit, from the pleadings in the action or from any admission made by the
party who delivered the discovery affidavit that there are reasonable grounds to assume
that there are additional documents in the position of that party . Federal Wine and
Brandy Co Ltd v Kantor 1958 (4 ) SA 732 (ECD) at 749H .
[13] In this case the plaintiff relies entirely on the claim in reconvention for the relief it seeks .
[14] In paragraph 1 of the notice the plaintiff seeks access to the defendant’s rate schedule,
referred to in paragraph 8.3 of the claim in reconvention . Paragraph 8 of the claim in
reconvention sets out the employee’s job description with the defendant . One of his
tasks is described in paragraph 8.3 as being to complete the defendant’s rate schedule
of both its subcontractors and its customers, for invoicing purposes .
[15] Paragraph 2 of the notice is direct ed at the discovery of the contracts referred to in
paragraph 10 of the claim in reconvention . Paragraph 10 of the claim in reconvention
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refers to the defendant’s contracts with third parties to which the employee would have
had access by virtue of his employment with the defendant.
[16] No attempt is made by the defendant in its founding affidavit to motivate why the
documents referred to in paragraphs 8 .3 and 10 of the claim in reconvention are
relevant to any matter in question in the action . The applicant content s itself with a
statement , in the form of a conclusion , that the documents are “material to an
understanding by the Plaintiff of the Defendant’s claim ”. In any event I cannot see how
documents refer red to in the context of the employee’s job description and the
defendant’s contracts with third parties are relevant to a claim for damages arising from
the alleged breac h of the subcontracting agreement . The principal issue is the extent
to which the employee had access to confidential information of the defendant . In the
subcontracting agreement neither the rate schedule of the defendant or its contracts
with third parties are identified as forming part of the defendant’s confidential
information. In paragr aph 10 of the claim in reconvention the defendant distinguishes
between its confidential information, on the one hand and its contracts, on the other
hand.
[17] Thus, on the ground that the plaintiff has not demonstrated the relevance of the rate
schedule or the contracts and on the ground that their relevance does not appear from
the pleadings , the plaintiff is not entitled to these documents. To this I must add that
it is significant that the plaintiff was able to plead to the relevant paragraphs of the
claim in reconvention by way of motivated denials without access to these documents.
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[18] Pursuant to paragraph 4 of the notice the plaintiff requires access to the credit
applications referred to in paragraph 1 3 of the claim in reconvention. Paragraph 13
reads like this :
“Barrath having resigned his employment on 28 February 2022 and having commenced his
employment with the plaintiff, the defendant became aware that the plaintiff started sending
through credit applications to customers and subcontractors of the defendant .”
[19] In reply the plaintiff concedes that defendant is not in pos session of the documents
referred to in paragraph 4 of the notice and this paragraph accordingly requires no
further attention.
[20] Paragraph 5 of the notice calls on the defendant to discover its “financial records would
[sic] demonstrate the manner in which the profit margin of 20% referred to by the
Defendant in its Counterclaim is arrived at ”. The defendant states that it has made
discovery of its detailed ledgers . One would have expected the plaintiff to be more
precise in identifying the documentation to which it seeks access. As it correctly states
in its replying affidavit, a profit is determined with reference to expenses incur red. Proof
of those expenses may be embodied in any number of documents, which have not been
identified by the plaintiff. It is uncertain whether the plaintiff’s request refers to annual
financial statements or all the source documents which were used to compile the annual
financial statements . In my view the request in paragraph 5 of the notice is vague and
overbroad. As has been stated the rule is not intended to “afford a litigant a licence to
fish in the hope of catching something useful .” Erasmus - Superior Court Practice, D1
Rule 35 -20 (Issue 22, 2023) and the authorities collected there.
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[21] Under paragraph 6 of the notice the Plaintiff seeks access to the Defendant’s “financial
records in respect of the six month period up to the 28th of February 2022 and in respect
of the six month period after the 28th of February 2022 from which the total sales of the
Defendant to those of its customers and suppliers not referred to in paragraphs 21.5
and 21.11 of its counterclaim to those customers are apparent ”. This paragraph is also
vaguely formulated , referring only in broad terms to “ financial records ”. The plaintiff
has also not stated why the documents referred to are relevant to any matter in
question in the action . The plaintiff has not alleged in its founding affidavit that the
relevance of these documents appear from the defendant’s discovery affidavit, or
documents referred to in the discovery affidavit . There is no admission by the defendant
which refers to the documents alluded to in paragraph 6 of the notice. In respect of the
entirety of the averments in paragraph 21 of the claim in reconvention the plaintiff has
proffered a bare denial. The plaintiff has not made any averment that the defendant’s
alleged loss of profits is not confined to the entities referred to in paragraphs 21.5 and
21.11 of the claim in reconvention. Therefore, there is no basis on which the plaintiff
could be entitled to access to the documents referred to in paragraph 6 of the notice.
The request
[22] In terms of Uniform Rule 21(2) a party to an action is entitled to seek from an opposing
party “only such further particulars as are strictly necessary to enable him or her to
prepare for trial ”.
[23] The relief the plaintiff seeks in respect of the request is for a “proper ” response to
certain enquiries contained therein. If the word “proper” in this context is given its
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ordinary grammatical meaning it refers to the form of the defendant’s response rather
than its content . I shall however assume in favour of the plaintiff that the use of the
word refers to the alleged insufficiency of the defendant’s response to the notice .
[24] Rule 21(4) provides that if “the party requested to furnish any particulars as aforesaid
fails to deliver them timeously or sufficiently, the party requesting the same may apply
to court for an order for the ir delivery or for the dismissal of the action of the striking
out of the defence, whereupon the court may make such order as to it seems meet ”.
[25] Rule 21(4) was interpreted by this Court in Warner v Warner and two other matters
2000 (4) SA 147 (E) at 150A-C, as follows:
“It is clear from the final words of this subrule , emphasising that the wrecks above, that the
Court retains the discretion to grant or refuse an order for the delivery of further particulars.
An applicant is accordingly not entitled to an order compelling a reply as of right should the
opposing party failed to deliver further particulars timeously all sufficiently, that must sit out
sufficient information to enable the Court to consider whether or not to exercise its discretion
in his favour.”
[26] In its founding affidavit the plaintiff has not set out any information to enable me to
consider whether or not to exercise my discretion , to order the furnishing of further
particularity , in its favour. It simply states that the particularity is sought to enable it to
prepare for trial. Th is statement does not satisfy the requirement of sufficient
information in the absence of an explanation why the particularity is required for trial
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preparation. Moreover, the requests were all responded to in some detail. Nothing in
the founding affidavit says why, and to what extent, these responses are insufficient.
[27] I have had regard to a letter dated 11 September 2024 , annexed to the founding
affidavit , which was addressed by the plaintiff’s attorney to the defendant’s attorney ,
demanding a more detailed response to the request. This letter is merely argumentative
but does not contain sufficient information to satisfy me as to why the particularity
sought is required for preparation for trial.
Conclusion and order
[28] For these reasons the plaintiff is not entitled to the relief sought in the notice of motion
dated 2 October 2024. In respect of costs t here is no reason for me to deviate from the
ordinary rule that costs follow the result. Thus, I make the following order:
The application is dismissed with costs.
O H RONAASEN
ACTING JUDGE OF THE HIGH COURT
The parties were represented as follows:
The applicant : Adv. KM Morris
Instructed by BLC Attorneys, 4 Cape Road, Gqeberha.
The respondent : Adv. L Ellis
Instructed by Steyn Inc (PE), 29 Bird Street, Central, Gqeberha