Case Note

City Power Johannesburg (SOC) Ltd v Devinity Trading (Pty) Ltd

Case No 035118/2024-as; Johannesburg High Court

Handed down: 31 July 2025

Reportability

This judgment raises issues of continuing practical importance to commercial litigants who make use of private arbitration but thereafter resist payment on the basis of belated attacks on the award. The court’s refusal to indulge an eleventh-hour, bar-mounted application for a postponement, coupled with a trenchant restatement of the limited grounds upon which an arbitral award may be reviewed under the Arbitration Act 42 of 1965, makes the matter one that the profession and the business community alike ought to note.

The decision is also significant because it emphasises that impecuniosity on the part of an organ of state or public entity—especially where unexplained—is not a circumstance that will lightly move a court to afford procedural indulgences. In a climate where state-owned enterprises regularly face liquidity challenges, the judgment draws an important line between genuine constraints and what the court called a “slovenly and indifferent” attitude to litigation.

Finally, the case reiterates the policy rationale that arbitration is intended to be a speedy and inexpensive mechanism. Courts must therefore be astute not to allow dilatory tactics to frustrate the enforcement of awards. For these reasons the judgment is plainly reportable.

Cases Cited

The judgment is largely self-standing and doctrinal. No earlier authorities were expressly cited in the portions of the judgment that deal with the merits of the postponement or the standard for a “gross irregularity”. Instead, the court relied directly on the wording and jurisprudence of the Arbitration Act 42 of 1965.

Legislation Cited

Arbitration Act 42 of 1965 – specifically the provisions governing review on the ground of gross irregularity in the conduct of the arbitration.

Rules of Court Cited

Although the application was mounted as an opposed motion (and so fell under Uniform Rule 6), the judgment does not refer to any specific rule beyond noting the informal, oral nature of the postponement request.

HEADNOTE

Summary

The applicant, Devinity Trading (Pty) Ltd, sought to have an arbitral award—made eighteen months earlier pursuant to an agreement concluded on 22 December 2015—made an order of court. The respondent, City Power Johannesburg (SOC) Ltd, filed a belated review application alleging gross irregularity on the part of the arbitrator. On the date set down for hearing, City Power’s instructed counsel withdrew because City Power had not paid its legal fees for several months. A replacement counsel, Mr Loopoo, appeared solely to seek a postponement from the bar.

The court refused the postponement. It held that City Power’s unexplained non-payment of its legal team displayed indifference both to its own interests and to the authority of the court. Assessing prejudice, the court found that further delay would significantly harm Devinity Trading, which had already waited nearly a decade for payment, whereas City Power had advanced no sworn evidence of prejudice. Turning to prospects of success, the court concluded that City Power’s review stood no chance: the alleged “legal point” said to have blindsided City Power was not identified on the papers, and the balance of its complaints went to the arbitrator’s factual and evaluative findings—matters that do not found a gross-irregularity review. The application for postponement was therefore dismissed with costs.

Key Issues

The proper test for granting a postponement when the request is made orally from the bar on the hearing date.

The scope of “gross irregularity” under section 33 of the Arbitration Act 42 of 1965 and the distinction between such a review and an appeal on the merits.

Prejudice to the opposing party and the public interest in finality and expedition of arbitral proceedings.

Held

The court held that City Power demonstrated neither good cause for a postponement nor any reasonable prospects of succeeding in its pending review application. In the absence of affidavit evidence explaining either its financial default or the substance of the alleged irregularities, refusing the postponement occasioned no unfairness. Devinity Trading’s enforcement application therefore proceeded, and the award was made an order of court with costs.

THE FACTS

Devinity Trading concluded a services contract with City Power in 2015 that incorporated a private arbitration clause. Disputes arose and were referred to arbitration, culminating in an award in favour of Devinity Trading some eighteen months before the present hearing. Despite the award, City Power neither honoured the debt nor immediately reviewed the award. Instead, it began sparring procedurally, ultimately launching a review on the last permissible day but without pressing it forward.

On the eve of the opposed motion hearing City Power’s long-standing attorneys and counsel withdrew because the municipality-owned entity had not paid them since December of the previous year. City Power briefed Mr Loopoo at the proverbial eleventh hour; his instructions extended only to seeking a postponement. No formal postponement application was prepared; no affidavit explained the failure to pay or disclosed any concrete prejudice should the matter proceed. By contrast, Devinity Trading had been deprived of the fruit of its award for almost a decade counting from the original contract.

THE ISSUES

The court was required to decide whether to grant a postponement requested orally on the day of hearing in circumstances where:

1. The requesting party had failed to pay its legal representatives, resulting in their withdrawal.


2. No affidavit or substantive explanation under oath was furnished.


3. The enforcement applicant continued to suffer ongoing financial prejudice.

A subsidiary but critical issue was whether City Power’s pending review application, premised on “gross irregularity,” had any reasonable prospect of success. If it did not, the balance of prejudice would overwhelmingly favour refusal of a postponement.

ANALYSIS

The judge began by emphasising that a litigant seeking a postponement bears an onus to show good cause, ordinarily by affidavit. An oral request made from the bar is an exceptional procedure and will seldom suffice absent compelling, fully explained circumstances. City Power failed at the threshold: it offered no sworn explanation for its financial default, nor any indication of concrete steps taken to secure alternative representation in good time. The court inferred a “slovenly and indifferent” litigation stance.

Turning to prejudice, the court contrasted Devinity Trading’s decade-long wait for payment, coupled with the costs of repeated delays, against City Power’s unsubstantiated assertions. Prejudice cannot be presumed; it must be proven. With no such proof, the scale tipped decisively in favour of proceeding.

Prospects of success received detailed attention. The judge scrutinised the notice of motion and founding affidavit in the review. The first ground—an alleged legal point decided without argument—was nebulous; the purported point of law was never identified. The second ground—wrongful weighting of evidence—fell squarely within the realm of appeal, not review. Under section 33 of the Arbitration Act, only errors so fundamental as to deny a fair trial qualify as “gross irregularities.” Disagreement with an arbitrator’s fact-finding or evaluative process does not meet that bar. Consequently, the review was described as “stillborn.” Absent any real prospect of success, the court found that refusing a postponement could not lead to injustice.

REMEDY

The oral application for postponement was dismissed with costs on the attorney-and-client scale, marking the court’s displeasure at City Power’s conduct. The arbitral award was forthwith made an order of court in favour of Devinity Trading (Pty) Ltd, thereby entitling it to execute against City Power for the amounts awarded, together with interest and costs.

LEGAL PRINCIPLES

A party seeking a postponement must demonstrate good cause on affidavit; an informal request from the bar will ordinarily fail unless truly exceptional circumstances, fully explained, are shown.

The grounds for reviewing an arbitral award under the Arbitration Act 42 of 1965 are narrow. “Gross irregularity” refers to procedural unfairness so severe that it deprives a party of a fair hearing; it does not encompass mere factual or legal error, nor disagreement with the weighting of evidence.

Prejudice is a factual matter that must be proved. When balancing prejudice in postponement applications, courts will weigh delay, financial harm, and the public interest in finality against any real, demonstrable disadvantage to the requesting party. Where prospects of success are virtually non-existent, denial of a postponement is unlikely to constitute an injustice.