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[1] The plaintiff seeks summary judgment in terms of Rule 3 2(1) of the Uniform Rules
in the amount of R500 000.00 against the first and second defenda nts, jointly
and severally.
[2] The plaintiff alleges that on 16 September 2022 she paid the amount of
R500 000.00 to the second defendant, Tammy Taylor SA Holdings having been
induced to do so by the first defendant, Mr Peet Viljoen, who at the time
represent ed the second defendant . The payment follow ed negotiations between
the plaintiff and the first defendant relati ng to a franchise agreement to be entered
into between the plaintiff and the second defendant.
[3] The plaintiff claims to have paid the R500 000.00 with the expectation that a valid
franchise agreement would be concluded and in the event it was not, that the
money would be refunded. The franchise agreement was subsequently not
concluded . As a result the plaintiff demanded payment of the R500 000.00 from
the defenda nts and the defendants refused to pay.
[4] The plaintiff’s claim against the first defendant is based on misrepresentation and
the claim against the second defendant is based on undue enrichment. The
defendants are defending the claims and have filed a joint plea thereto. The first
defendant is opposing the summary judgment application and has filed an
affidavit . There was no affidavit filed on behalf of the second defendant resisting
the summary judgment application. At the hearing of the application though, one
counsel filed heads of argument , appeared and submitted argument for both the
first and second defendants.
[5] In this judgment I shall refer to the first and second defendants, collectively, as
the defendants and w here context demands, I shall refer to the first defendant as
Viljoen and the second defendant as Tammy Taylor SA.
Facts
[6] In the affidavit filed in support of the summary judgment, the plaintiff alleges that
on 15 September 2022 she met with Viljoen to negotiate a possible franchise
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agreement , a copy of which was furnished to her for consideration. Viljoen
represented to her that Tammy Taylor SA is the licensee of Tammy Taylor Nails
USA, being the main holder of the franchise license.
[7] According to t he plaintiff Viljoen persuaded her to pay the amount of
R500 000.00 so she could be in a better position for consideration as entering
into a franchise agreement under the name and style Tammy Taylor SA was in
demand.
[8] After payment was made, the plaintiff established that the master license
agreement between Tammy Taylor SA and Tammy Taylor USA , the main license
holder, was terminated in February 2021 . Therefore a sublicense with third
parties by way of a franchise w ould not have been legally possible. She became
concerned that Viljoen may have misrepresented Tammy Taylor SA’s ownership
of the trademark to her in that despite the termination of the master license
agreement, Viljoen represented that Tammy Taylor SA was the licensee of
Tammy Taylor Nails USA, and therefore legally entitled to enter into sublice nsing
agreements with third parties, in this case the plaintiff.
[9] The plaintiff pleaded that the defendants were aware of the termination because
Tammy Taylor USA issued a “cease and desist letter ” against the defendants for
the continued unlawful use of the trademark in May 2021. The plaintiff then
decided not to proceed with the franchise agreement and because no agreement
was entered into, the amount of R500 000.00 was not due and payable or owing
by the plaintiff to the defendants. As a result , on 23 September 2022 the plaintiff
demanded payment of the money from the defendants and they refused to pay .
[10] Viljoen and Tammy Taylor SA filed one plea. In the plea the defendants admit
the negotiations, that Viljoen represented Tammy Taylor SA and that the plaintiff
paid the amount of R500 000.00 to Tammy Taylor SA. The defendants den ied
the rest of the allegations and specifically that there were any misrepresentations
on the part of Viljoen. They pleaded that the R500 000.00 was a deposit in terms
of the franchise agreement and deny as a result, that they have derived any
benefit from t he payment.
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[11] The affidavit resisting summary judgment is deposed to by Viljoen. He admits
that he negotiated the franchise agreement with the plaintiff representing Tammy
Taylor SA, but state d that he no longer does. Viljoen also admits that following
the negotiations the plaintiff paid the amount of R500 000.00 to Tammy Taylor
SA. He explain ed that the R500 000.00 was a deposit and in partial payment of
the full price in terms of a franchise agreement that the plaintiff has then reneged
from.
[12] Viljoen denied that the R500 000.00 was paid to Tammy Taylor SA without
proper cause and specifically that there were any misrepresentations made by
him to the plaintiff. Viljoen denied , in particular , having derived any benefit from
the payment because, as he argues, the money was not paid to him but to
Tammy Taylor SA, he was never in possession of the money and therefore was
not enriched thereby.
Legal principles
[13] Rule 32(1) provides that the plaintiff may, after the defendant has delivered a
plea, apply to court for summary judgment on a claim based on a liquid
document; for a liquidated amount in money; for delivery of specified movable
property; or for ejectment. A liquidated amount in money is an amount which is
either agreed upon or which is capable of speedy and prompt ascertainment .1
[14] Rule(2)(a) and ( b) provides that an affidavit made by the plaintiff in support of
summary judgment or by any other person who can swear positively to the facts
shall, in addition to verify ing the cause of action and the amount claimed and
identify ing the facts upon which the plaintiff’s claim is based, explain briefly why
the defence as pleaded does not raise any issue for trial.
1 Lester Investments (Pty) Ltd v Narshi 1951 (2) SA 464 (C) ; Fatti’s Engineering Co (Pty) Ltd v Vendick
Spares (Pty) Ltd 1962 (1) SA
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[15] In Standard Bank v Rahme and Similar Cases2 the court stated the following, in
relation to the new requirement in Rule 32(1) that the plaintiff must briefly explain
why the defence as pleaded does not raise any issue for trial:
‘The amended rule appears to raise the bar and onus for securing summary
judgment. By implication, a plaintiff must satisfy the court that the defendant
has no defence on the merits when under the old rule, it was enough to show
a defendant lacks a bona fide defence .’
[16] Rule 32(3)( b) provides that the defendant may satisfy the court by affidavit that
the defendant has a bona fide defence to the action . Such affidavit shall disclose
fully the nature and grounds of the defence and the material facts relied upon.
[17] In Joob Joob Investments (Pty) Ltd3 the court stated that Summary judgment
proceedings are not intended to deprive a defendant with a triable issue or a
sustainable defence of their day in court. The court went to state that “ After
almost a century of successful application in our courts, summary judgment
proceedings can hardly continue to be described as extraordinary. Our courts,
both of first instance and at appellate level, have during that time rightly been
trusted to ensu re that a defendant with a triable issue is not shut out .”
[18] The well-established principle in the Maharaj4 is that the Court must consider,
first, whether there has been sufficient disclosure by a defendant of the nature
and grounds of his defence and the facts upon which it is founded , and second
whether the defence so disclosed is both bona fide and good in law. If this
threshold has been crossed the court is then bound to refuse summary judgment.
[19] In Maharaj , the court continued to state that where the defence is based upon
facts, in the sense that material facts alleged by the plaintiff in his summons, or
combined summons, are disputed or new facts are alleged constituting a
defence, the Court should not att empt to decide these issues or to determine
whether or not there is a balance of probabilities in favour of the one party or the
2 Unreported, GJ case nos 17/46904; 27740/2018; 27741/2018; 3765/2019; 11912/2018 dated 3
September 2019, at paragraph [8].
3 Joob Joob Investments (Pty) Ltd v Stocks Mavundla Zek Joint Venture 2009 (5) SA 1 (SCA) at 11G –
12D.
4 Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A) at 425G –426E.
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other. The defendants must fully disclose the nature and grounds of their defence
and the material facts on which it is founded. All a defendant has to do is set out
facts which if proven at trial will constitute a good defence to the claim.5
Analysis
[20] The defendants have admit ted that the plaintiff paid Tammy Taylor SA the
amount of R500 000.00 and have refused to pay the plaintiff the money despite
demand . The plaintiff’s claim is therefore for a liquidated amount and it was
agreed and therefore easily determinable .
[21] The question for determination is therefore whether the defendants have
disclosed a bona fide defence to the plaintiff’s claims .
[22] Viljoen filed an affidavit resisting summary judgment in which, while admitting
that he represented the second respondent at the time, he now stated that he no
longer does. Given the nature of the claims in this action and the fact that Tammy
Taylor SA is a corporate entity, Viljoen d id not give any particularity as to when
exactly he ceased to represent Tammy Taylor SA. In so doing Viljoen appeared
to attempt to sep arate himself from Tammy Taylor SA.
[23] I say attempted because Viljoen and Tammy Taylor SA were represented by the
same counsel briefed by the same attorney. In the heads of argument and during
oral argument joint legal submissions were made for both defendants. Viljoen
himself also submitted statements and argument in his affidavit in defence of
Tammy Taylor SA. The attempt to separate himself from Tammy Taylor SA in
those circumstances, does not appear bona fide but devised solely to avoid
liability.
[24] For his part, Viljoen admitted that he held the negotiations with the plaintiff in
relation to the franchise agreement . He however, denies that he made any
mirepresentations to the plaintiff and induc ing her to pay the the amount of
5 Fn5 Supra ,.
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R500 000.00 . Just as pleaded by the defendants in the plea, Viljoen argue d that
the payment was made as a deposit in terms of the franchise agreement .
[25] It is a well -established principle of our law that the party relying on
misrepresentation must prove that the representation relied on was made, that
the representation was false in that what was shown as fact was not as
represented. What the plaintiff must show is not merely that it was, or turned out
to be, erroneous, but that it did not represent the bona fide view, at the time when
it was expressed, of the person who expressed it. The plaintiff must then prove
that the representation was material to defendants’ representation s and that the
representations were intended to induce the person to whom it was made to enter
into the transaction sought to be avoided.6
[26] In this case, although the plaintiff has pleaded details of the misrepresentation
relating to Tammy Taylor SA’s license to trade as such, the defendants,
particularly Viljoen, have failed to plead or submit any evidence to show
otherwise. Viljoen has failed to attach to his affidavit the license or any document
showing Tammy Taylor SA’s entitlement to enter into the franchise agreement,
as he represented. Viljoen also did not attach the franchise agreement on the
basis of which the deposit was purportedly paid, nor did he state the full franchise
price to which the R500 000.00 was the deposit. In those circumstances, Viljoen
also failed to state the reason for accepting an offer of a deposit, as he claims,
on behalf of Tammy Taylor SA for no legal basis whatsoever.
[27] Viljoen could not have been of the bona fide view that the representations were
fact and true. The representa tions were material to the negotiations relating to
the franchise agreement and the payment of R500 000.00 was made by the
plaintiff to Tammy Taylor SA as a direct result of those representations.
[28] The fact that Viljoen in his affidavit has now stated that he does not know the
reason why Tammy Taylor SA has not paid back the R500 000.00 to the plaintiff ,
6 Novick and another v Comair Holdings LTS and Others [1979] 3 All SA 73 (W) at 149
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also indicates that he similarly could not have bona fide regarded the
R500 000.00 as not refundable in the event the franchise agreement was not
concluded.
[29] It was argued on behalf of the defendants that allegations of misrepresentation
were ill-suited for summary judgment and must appropriately be referred for trial.
It was argued that Summary judgment is an extraordinary remedy, granted only
where it is manifest that the defendant has no bona fide defence and has entered
an appearance to defend merely to delay the plaintiff’s claim. It is not intended to
short -circuit disputes that ought to be properly ventilated at trial.
[30] I disagree. The above defences of the defendants leave nothing for
determination at trial. In Tumileng Trading CC v National Security and Fire (Pty)
Ltd the court stated that the fact that there is a triable issue does not mean
summary judgment must be refused only on that basis. This is because the
enquiry is not whether the plea discloses “an issue for trial” in the literal sense of
those words, it is whether the ostensible defence that has been pleaded is bona
fide or not. It is for these reason s that the the rule -maker deci ded to leave subrule
32(3) substantively unamended. That is demanding from the defendant to show
that its defence to the action is bona fide ; i e that its ostensible defence is not a
sham.7
[31] As stated above, Tammy Taylor SA is a corporate entity and at all relevant times
was represented by Viljoen who, beyond denying some of the material
averments relating to his role, did not ascribe any of the misrepresentations made
to the plaintiff to anyone. His attempts to diassociate himself from Tammy Taylor
SA in those circumstances in my view points to the lack of bona fides in his own
defence.
[32] Viljoen has simply failed to show bona fide defence to the plaintiff’s claims of
misrepresentation on his part and most importantly, to set out fully, the facts and
evidence on which the defence that “the representations were true” is based on.
7 2020 (6) SA 624 (WCC) at para [40]
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[33] Tammy Taylor SA on the other hand, did not file an affidavit resisting summary
judgment. Having admitted in the plea that it has received the R500 000.00 and
refusing to refund the money notwithstanding that there was no franchise
agreement, Tammy Taylor SA had the duty under Rule 32(3) to show that it has
a bona fide defence to the claim of undue enrichment and set out fully the nature
and grounds of its defences, if any, and the material facts relied upon. Tammy
Taylor SA has failed to do so.
[34] I therefore find that the representations made by Viljoen to the plaintiff were
false , constituted misprepresentations and therefore unlawful. Viljoen’s
misrepresentations in turn induced the plaintiff to pay the amount of R500
0000.00 to Tammy Taylor SA and as a result of which the plaintiff suffered a loss.
Viljoen is therefore personally liable for the plaintiff ’s loss and damages in the
amount of R500 000.00.
[35] Because there was no franchise agreement subsequently entered into between
Tammy Taylor SA and the plaintiff, the payment of R500 000.00 was not due and
payable, Tammy Taylor was unduly enriched thereby and there is no legal basis
for Tammy Taylor SA to refuse to pay the money to the plaintiff .
[36] In line with the principle in the Maharaj8 there has not been sufficient disclosure
by the defendants of the nature and grounds of their defence and the facts upon
which it is founded. Their bare denials, particularly of material allegations are
simply not defences that are bona fide and good in law . Significantly, the
defendants have not established a case for matters for determination at trial.
Accordingly, the defendants have failed to cross the threshold required for the
refusal of summary judgment.
[37] On the other hand, I am satisfied that the plaintiff has sufficiently explained her
cause of action and the reasons why the defence as pleaded does not raise any
issue for trial, as required in terms of Rule 32(1)(b). I find consequently that the
plaintiff has made out a proper c ase for summary judgment to be granted in her
8 Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A) at 425G –426E.