In the High Court of South Africa
(Western Cape Division, Cape Town)
Case No: A196/2024
In the matter between:
NORDIEN FAMILY ENTERPRISES (PTY) LTD First Ap pellant
THE IT EXPERIENCE GROUP SA (PTY) LTD Second Appellant
BAKED GROUP (PTY) LTD Third Appellant
and
NEONOMAD CAPITAL (PTY) LTD Respondent
Matter Heard: 10 March 2025
Judgment Delivered: 27 March 2025
JUDGMENT
MANTAME, J
[1] The first, second and third appellants ( appellants ) appeal against the
judgment and order of the Court a quo that was handed down on 20 March 2024
cancelling the agreement that was concluded between the appellants and the
respondent on account of the appellant’s repudiation; ordering payment of an
amount of R 5.7 million to the respondent and the respondent, upon receipt of the
payment of R5.7 million, to provide the appellants with a duly signed and completed
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share transfer form in terms of which the respondent’s shares in the thi rd appellant
are to be transferred to the transferee identified by the respondent.
[2] The appeal is opposed by the respondent on the basis that it lacks merit.
Essentially the respondent stated that the refusal to perform in accordance with the terms agreed upon amounted to a repudiation. However, if both parties believe a
contract was concluded, but each contend for materially different terms, then there can be no doubt that both parties are mistaken and that no contract was concluded. [3] The first appellant established the Baked restaurant business (Baked) in
2020. Basically , it conducts the business of operating café’s, deli’s, bars, lounges
and online shops specialising in the sale of cannabis infused products. It was a year
later that the respondent became interested in this business . The appellants
contended that during 2021, Mr Beukes approached them and expressed his wishes to branch into the cannabis industry and a cannabis – friendly retail business such as
Baked was identified by him as an ideal one. He was aware that the appellants do
not have funds to open more Baked branches.
[4] During 2021/2022, the appellant’s represented by Mr. Shaan Nordien ( Mr.
Nordien) and the respondent represented by Mr. JA Beukes ( Mr Beukes ) entered
into an agreement in terms of which the respondent would invest an amount of R5.7
million in the Baked business. [5] According to the appellants, Mr Beukes presented them with a proposal that
would generate sufficient funds to expand the Baked brand in South Africa and internationally. Mr. Beukes proposed that 200 000 000 crypto currency tokens would
be issued when t he respondent launched the crypto currency tokens on behalf of the
third appellant . It was then agreed that Mr Beukes would prepare a prospectus for
the respondent to present to the crypto currency market to raise the funds for the
expansion of the Baked brand globally. The prospectus was never provided and Baked was never listed on the crypto market.
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[6] For the purposes of this proposal, the appellants said that Baked
Bloubergstrand was estimated to be worth R10 million, based on the annual profits
at the time. Based on Mr. Beukes’s proposal the parties agreed t hat:
6.1 The respondent would invest an amount of R10 million for purposes of
opening two more Baked branches, before taking the Baked to the crypto market to raise the funds;
6.2 Mr. Beukes undertook to sell 200 000 000 Baked tokens on the crypto
currency in stages;
6.3 From the funds raised, an amount of R10 million would be paid to the
first appellant and the respondent’s investment of R10 million would be repaid;
6.4 The assets of the first appellant would be transferred to a new entity to
be formed called Baked Group (Pty) Ltd and the balance of the funds raised from the crypto currency listing would be used to expand the Baked brand globally;
6.5 Once this obligation was fulfilled by Mr Beukes to launch the
respondent and raise the capital on the crypto currency market, Baked Group
(Pty) Ltd would commence operations;
6.6 Once the Baked Crypto tokens were launched on the crypto currency
market, the third appellant would pay Mr. Beukes a director’s salary, an office
rental, vehicles and vehicle insurance.
[7] The appellants contended that the motivation to become involved with Mr.
Beukes and the reason for the acceptance of his proposal was not so much about
the R10 million investment to open two more branches, but rather the stated intention by Mr. Beukes that would expose Baked Group (Pty) Ltd to the crypto currency and utilise the funds so generated to open more branches in South Africa and globally.
[8] The respondent denied the entire version of the appellant’s agreement and
that the R5.7 million investment paid was part of a R10 million which he would have paid to open two more branches. On the respondent’s interpretation of the entire
agreement the appellants relied on, the respondent would have to provide the first
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appellant with R20 million of non- refundable funding in return for a 50% share in the
third appellant, which would remain an empty shell until the respondent has fulfilled
all the obligations stated in paragraph 6 above. In the respondent’s view, t hat did not
make business sense.
[9] A dispute in this matter centres around the terms of the oral agreement that
prompted the respondent to pay an amount of R5.7 million in the expectation that it would become the co – owner of the Baked business in De Waterkant, Green Point
and which would be housed in the third appellant.
[10] The respondent stated that if regard is had to its version of the agreement, it
is more probable than the “detour type of an agreement” that the appellants relied on. The respondent averred that it was agreed with the second appellant that the
third appellant would be incorporated in order to use it as a vehicle to conduct and expand the Baked business. The first appellant would contribute the existing Baked outlet in Bloubergstrand and the various activities related thereto. The R5.7 million investment in the Baked business would be utilised to conduct and expand the
business and, more particularly would fund the establishment of a new Baked outlet
in De Waterkant, Green Point. It would further be utilised to provide some office
space for the third appellant and the respondent.
[11] The respondent and the second appellant would each obtain 50% of the
authorised and issued share capital in the third appellant. The respondent, Mr.
Nordien, hi s wife and son would all be entitled to serve as directors of the third
appellant’s board. An amount of R5.7 million was duly paid by the respondent in 2022 and the respondent and second appellant were each issued with their 50%
shares in the third appellant . It was the respondent’s understanding that Mr. Nordien
required his investment as he could not afford the establishment of the new Baked
outlet in De Waterkant, Green Point.
[12] On 02 February 2022 Mr. Nordien confirmed to Mr Beukes that the Baked
Green Point outlet would consist of the head office, bakery, an online shop, a Baked café and deli, a fine dining space called The Vault, a Baked hookah lounge and a
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cocktail bar. This outlet was opened during October 2022 and has remained
operational until to date.
[13] The appellants raised four grounds of appeal . First, that the Court a quo
applied the incorrect test for the determination of factual disputes in motion proceedings. In so doing, it erred in concluding that the appellants’ version was
untenable. Their version can only be rejected in motion proceedings only if it is “fictitious” or so far- fetched and untenable that it can confidently be said, on the
papers alone, that it is demonstrably, and clearly unworthy of credence – They found
support in their contention in Fakie N.O v CC II Systems (Pty) Ltd .
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[14] The respondent contended that a determination as to whether, upon the
application of the correct test and principles, a litigant’s version is so improbable that it is rendered untenable or far – fetched and maybe dismissed out of hand involves
the exercise of a discretion in ‘broad” or “loose” sense of a value judgment that is
performed after regard is had to a variety of diverse and contrasting considerations. Accordingly, an appellate court is entitled to interfere if it should find that it would have come to a different conclusion than the Court a quo.
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[15] The Court a quo, the respondent argued, correctly resolved the issue
pertaining to the terms of the oral agreement considering the fact s as presented by
the parties in order to determine whether the dispute of fact was a genuine and bona fide one or whether the appellants’ version was far – fetched and untenable that it
could be rejected out of hand.
[16] The respondent agreed that the correct approach and a stringent test to be
applied is the one that was espoused in National Sc rap Metal (Cape Town) (Pty) Ltd
v Murray and Roberts Ltd.
3 The parties differed on the appellant s contention that a
mere fact that a version may be unsatisfactory, or even improbable, does not render it so far – fetched and untenable as to be dismissed without evidence. The
1 2006 (4 ) SA 326 SCA at para [56]
2 Oakdene Square Prop (Pty) Ltd vs Farm Bothasfontein (Kyalami)(Pty) Ltd 2013 (4) SA 539 (SCA)
paras [18] – [21]; and Trencon Construction (Pty)Ltd vs Industrial Development Corporation of South
Africa (Pty) Ltd 2015 (5) SA 245 (CC) paras [82] to [92]
3 2012 (5) SA 300 (SCA)
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respondent submitted that the Court a quo considered and evaluated the parties’
respective versions of the terms of their oral agreement in the light of the objective
facts which emerged from the papers. S uch objective facts include the
contemporaneous WhatsApp messages the parties’ exchanged, their respective
conduct in performance of their agreement and the contention advanced in correspondence by their attorneys on their behalf. The respondent submitted that the
Court a quo correctly came to a conclusion that the appellants’ version of the oral
agreement was utterly inconsistent and incompatible with the available objective evidence. I n this respect, the court a quo held that , the appellants’ version was
untenable and the appellants failed to raise a bona fide genuine dispute of fact
warranting referral to oral evidence.
[17] For instance, if the appellants stated that the respondent was supposed to
have paid an amount of R10 million upf ront for the two Baked businesses, it should
have insisted that it be paid because that was a quid pro quo for the 50 %
shareholdership. That did not happen. The appellant’s version is therefore not supported by the objective facts.
[18] Whilst it is common cause that there is a dispute, in so far as to what was the
ultimat e agreement between the parties, however, the objective fact is that all the
terms alleged by the respondent were complied with. The fact that the respondent
admitted that some issues were discussed during the negoti ation phase by the
parties, does not necessarily , in our view, amount to an agreement and clearly such
may not necessary constitute a genuine dispute of fact. A bona fide genuine dispute
of fact means a real and since re disagreement over a factual matter, not a mere
denial or a fabricated claim.
[19] In this instance, it was incumbent upon the appellants’ raising a real, genuine
and bona fide dispute of fact to seriously and unambiguously address the disputed
facts on their answering affidavit.
4 However, they failed to do so. The Court a quo
correctly pointed out in its judgment that the objective facts support the respondent’s
version. On the other hand, t he appellants’ failed to support their long list of
4 Wightman t/a JW Construction v Headfour (Pty) Ltd and Another 2008 (3) SA 371 (SCA) para [13]
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allegations with evidence. In such a situation, an unsupported mere say – so of the
appellants cannot amount to a genuine dispute of fact that would result in the matter
being referred to oral evidence. In our view, t here is no merit to this ground.
[20] Second ground, t he appellants contended that the Court a quo erred in its
evaluation of the facts, and in so doing incorrectly found that there were unsatisfactory aspects of the appellants’ version. For instance, the appellants said the Court a quo did not attach due weight to certain common cause facts relied upon
by the appellants; it relied on factual allegations that were not made in the papers; and impermissibly relied on a presumption as to what constitutes business like consequences.
[21] This contention was denied by the respondent and it was stated that the mere
fact that ideas were bandied about or a creation of crypto currency tokens was
discussed as means of raising capital whilst negotiating a contract does not mean that these ideas were adopted as terms of any contract.
[22] It is trite that in motion proceedings, the affidavits constitute both the
pleadings and evidence, and the issues and averments in support of the parties’ case should appear clearly from the affidavits.
5 Where a party annexes documents
to their affidavits, it is incumbent on a party to identify portions thereof in which reliance is placed as an indication of the case which is sought to be made out on the strength of the document. I t cannot be expected of a party to speculate on the
relevance of annexures.
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[23] When the appellants were presented with the respondent’s case in the Court
a quo it was not their defence that they did not know which case to meet. Similarly, in
their answering affidavit, they did not indicate that they had difficulties with the relevance of the annexures. Clearly there are inconsis tencies in as far as the
appellants alleged their version of the contract that was agreed upon and the respondent alleged a totally different one.
5 Minister of Land Affairs and Agriculture v D and F Wevell Trust 2008 (20 SA 184 (SCA)
6 Swissborough Diamond Mines (Pty) Ltd and Others v Government of the RSA 1999 (2) SA 279 (T)
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[24] In this instance, common cause facts remained common cause. There was
no obligation on the Court a quo to adjudicate on such matters, unless an area of
importance and/or concern was brought to its attention. In fact, this Court agrees
with the respondent’s view that the version of an oral agreement as alleged by the appellants is unbusinesslike. That is a matter of interpretation and need not necessarily be alleged factually as the appellants suggested.
[25] The Court a quo in its evaluation of the evidence and its finding of the aspects
of the appellants’ evidence cannot be faulted as its case was littered with unsupported defences. The respondent submitted that where a party’s version of an agreement is not merely found to be unbusiness like but is held to be extremely
unbusiness like, if not absurd, that would certainly be a ground for rejecting such a
version. We are agree with this submission. Similarly, there is no merit on this
ground.
[26] Third ground, the appellants submitted that the Court a quo erred in making
an order that was inconsistent with its earlier finding that the parties were not ad
idem as to the terms of their agreement. The appellants argued that the Court a quo
erred in ordering that the agreement was cancelled by virtue of the appellants’ repudiation thereof. In the appellants’ interpretation, such a finding presupposes that a valid agreement existed and a consensus between the parties as to the terms of the agreement was reached. It was therefore not competent to order cancellation
based on repudiation.
[27] The respondent submitted that the Court a quo correctly observed that upon
receipt of the appellants’ response to the respondent’s cancellation of the agreement, it became apparent that the parties held divergent views of the terms of their agreement. The Court a quo came to the conclusion that the respondent’s
version of the agreement was the correct one and the appellants’ implicit refusal to
perform in accordance with its terms amounted to a repudiation, which repudiation justified the respondent’s cancellation.
[28] It is indeed so that the parties held divergent views with regards to the terms
of their oral agreement . Despite that being so, that did not preclude the Court a quo
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from analysing the evidence that was put before it and coming to conclusion that the
agreement was cancelled by virtue of the appellants’ repudiation. As stated in this
judgment, there was no bona fide genuine dispute of fact that warranted a referral of
the matter to oral evidence. Importantly, a court ’s observation or a comment in
passing (obiter dictum) should be differentiated from the court ’s findings. The Court
a quo had enough evidence to observe and conclude as such. In this Court’s view,
there is no inconsistency between the observations, the findings that were reached by the Court a quo and the ultimate order.
[29] Fourth and final ground, the appellants contended that the Court a quo erred
in not dismissing the application or referring the matter for oral evidence, as required by Rule 6 (5) (g). The appellants submitted that i n light of the dispute as to the terms
of the oral agreement, the Court a quo should have resolved the dispute by referring
the matter to oral evidence and not decided the matter on papers.
[30] The appellants’ suggestion seems to lose sight of the fact that a dismissal of
an application or a referral of a matter to oral evidence cannot be made as of right
and or entitlement. There is a balancing act which the Court has to take i nto
consideration. As stated in Wightman it was held that a Court must be satisfied that a
party raising a dispute has seriously and unambiguously addressed the fact in
question. That means a party cannot simply deny a fact to create a dispute. It should be a bona fide genuine dispute of fact. A party must provide a specifi c and a
reasoned basis for its denial. The Court will therefore employ a balancing act of
considering whether the dispute is genuine and/or whether it is capable of resolution on the papers presented or it will call for fur ther evidence or trial. Referral of a matter
to oral evidence is not a forgone conclusion if raised. The Court has to be satisfied
that there is indeed merit to the point raised and consequently there is not merit to this ground .
[31] Dissensus between the parties , although it was the last point raised in the
parties’ submissions, it was said to be irrelevant and not a basis for the Court a quo’s
decision. However, it is the natural alternative to repudiation. Be that as it may, this Court is of the view that it should not be occupied by the issues that were not before the Court a quo.
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[32] In the result the following order shall issue:
[32.1] The appeal is dismissed with costs.
MANTAME J
WESTERN CAPE HIGH COURT
I agree, it is so ordered:
DOLAMO J
WESTERN CAPE HIGH COURT
I agree:
SLINGERS, J
WESTERN CAPE HIGH COURT
COUNSEL FOR THE APPLICANTS: ADV P GABRIEL
INSTRUCTED BY: VAN ZYL KRUGER ATTORNEYS
COUNSEL FOR THE DEFENDANT: ADV A NEWTON
INSTRUCTED BY BOUCHER ATTORNEYS