IN THE HIGH COURT OF SOUTH AFRICA
(GAUTENG DIVISION, JOHANNESBURG)
(l) Rc:PORT ABc.!:: NO
(2) OF INTEREST TO OTHER JUDGES: NO
(3) REViSED. NO
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~AiE / SIGNATURE
SOUTH AFRICA BROACASTING CORPORATION SOC
LIMITED
SPECIAL INVESTIGATING UNIT
AND
NAZEEM HOWA
VURUN GUPTA
ATUL KUMAR GUPTA
GARY NAIDOO
Case Number. 2018/16694
FIRST APPLICANT
SECOND APPLICANT
FIRST RESPONDENT
SECOND RESPONDENT
THIRD RESPONDENT
FOURTH RESPONDENT
JUDGMENT
MAKUME, J:
1. This is an application in terms of Rule 10 of th e Uniform Rules
in which the applicant 's seek an order joining the first , second ,
third and fourth respondents as the third , fourth , fifth and sixth
respondents in the main application (t he review application)
against TNA Media Pty Ltd in liquidation.
2. Besides seeking an order for substituted serv ice against certain
of the respondents , by virtue of them being no longer in the
Republic of South Africa , the applicant 's seek an order in terms
of Section 20(9) of the Company's Act 71 of 2008 , to declare
that TNA Med ia not be deemed to be a juristic person , but a
venture of the respondents personally.
3. Last ly, that , i n the event that TNA Media is ordered to repay
moneys it received in the impugned tender , then upon joinder it
be declared that the joined respondents are jointly and severally
liable to the fi rst applicant for repayment of such amount .
BACKGROUND FACTS
4 . On or about 13 March 2012 SABC entered into a written
agreement with TNA Media in terms of which TNA undertook to
ho st a series of events, known as "The New Age Breakfast
Briefing , brought by SABC ".
5. On 20 February 2015 the same parties concluded a renewal and
amendment agreement of the main agreement, which was to
extend same for a period of 36 months , terminable in the year
2018.
6. The events leading to the conclusion of the two agreements
were raised at the ad hoc parliamentary committee , that was
investigating events at the SABC. This led to the ad hoc
committee, referring it to the interim board of SABC, who, after
investigation, decided to refer the matter to the special
investigating unit that had been tasked with investigating all
Gupta-related contracts , due to revelations at the State Capture
Commission (Zondo Commission) .
7. Investigations had revealed that TNA Medi a had been awarded
the contract by SABC improperly and not in accordance with
procurement procedures , as envisaged in Section 217 of the
Constitution , as well as supply-chain procedures of the SABC .
8. It is common cause that , at the time of the conclusion of the
contract the first, second , th ird and fourth respondents were all
directors of TNA Media.
9. On 6 June 2017 the Chief Operations Officer of SABC , in the
person of Bessie Tugwotwa , and the Deputy Chairperson of the
SABC Board , Mathata Tsedu met with a delegation from TNA,
and in fo rmed them that SABC was terminat ing the impugned
contract.
10. Attorneys acting for TNA then addressed a letter of demand to
the SABC , accepting repud iation of the agreement and claimed
damages in amount of R144 million. The attorneys
subsequently referred the dispute for arbitration to AFSA , in
terms of the impugned contract.
11 . It was shortly after that, that SABC brought an appl ication on
an urgent basis. Part A is an interdict stopping the arbitration
process , pending outcome of Part B, in which SABC seeks an
order declaring the two agreements null and void ab initio.
12. Shortly thereafter TNA was placed under provisional
liquidation and was finally liquidated later. In the year 2019
the SIU successfully applied to be joined as a second
applicant in the main application.
13. On 1 O December 2022 the first applicant launched this
applicat i on to join the second , third and fourth respondents as
respondents in the main application. The joinder application
was brought on the basis that firstly the state capture report
had recommended that the SABC should consider instituting
civil proceedings against TNA Media , or its directors , and
recover all costs incurr ed by the SABC, including
disgorgement profits by TNA Media in relation to the breakfast
shows .
14. The second and third respondents filed notice to oppose the
joinder application and appointed Van Der Merwe Attorneys as
the attorneys of record on 6 February 2023.
15 . On 14 Feb ruary 2023 Wer ksma ns Attorneys withdrew the
original applica tion for joinder , and on 4 March 2024 an
amended notice of joinder was relaunched with the following
prayers:
15 .1 . That first, second , third and fourth respondents be joined
as the third , fourth , fifth and sixth respondents
(respond ents ) in the review application between the
applicants and TNA Media under case number 16694/18 .
15 .2 . That the application may be served on the respondents
by :
(i) one public ation of the notice of motion , excluding
affidavit in an English Newspaper , circulating
throughout the Republic of South Africa ;
(ii) forwarding a copy of the notice of mo ti on , iri'cluding
affid avits, to the respondents via electronic media
platform s, such as WhatsApp , Facebook , lnstagram
and or like p latfo rm , alternatively ;
(iii) granting lea ve for the appl icants to serve the
respondents by means of ed ict al citation.
15 .3 . It is dec lared that in terms of Section 20(9 ) of the
Company 's Act 71 of 2008 , as amended , TNA Media
shall be deemed not to be a juris tic person , but a
venture of the respondents persona lly.
15.4 . It is hereby furthe r declared that , in the event of TNA
media being ordered to repay any moneys to the
applicants in the review application , that the
respondents, upon their joinder be declared to be
jointly and severally liable to the applicants for
repayment of such moneys , the one paying the other
to be absolved .
16 . On 6 May 2024 the applicants further amended the prayer set
out above by deleting prayers 15.3 and 15.4 above. It is
further worth noting that the prayers in respect of substituted
service were later abandoned due to the respondents having
agreed that service on them be at their attorneys of record .
What then in reality remains, is the application to join the four
respondents and the cost of that application.
17 . There are two separate applications to strike , one by the
applicants t hemselves in respect of certain averments set out
in paragraph 9, 16 .8, 17 ~nd 14.2 up to 53 in the affidavit by
Nomsa Penelope Felity in view of the fact that the applicant
had by then amended its notice of motion by deleting prayers
3 and 4 . That application was not opposed and is accordingly
granted .
18 . The second application to strike out is by the respondents ,
seeking the striking out of the word "nefarious " as it appears
on paragraph 29 of the affidavit by Nomsa Penelope Felity , as
well as paragraphs 37 and 41 , up to and including paragraph
48 and 53 .
19. According to the dictionary the word "nefarious" is an
adjective, meaning "extremely wicked , villainous, criminal or
immoral ". It describes actions , plot s or people that are
shockingly evil or underhanded. The applicants used this word
only once in paragraph 29 of its foundi ng affid avit. The
deponent specif ically says : " Nefarious acts of TNA Media " and
does not refer specifically to any of the respondents that are
sought to be joined.
20. Rule 23(2) of the Uniform Rules provide as follows:
"Where any pleading contain averments
which are scandalous , vexatious or
irrelevant, the opposite party may within the
period allowed for filing any subsequent
pleading apply for the striking out of the
matter aforesaid , and may set such
appl ication down for hearing in terms of
paragraph F or subrule (5) of Rule 6 , but the
cou rt shall not grant the same , unless it is
satisfied tha t the appl icant will be prejudiced
in the conduct of his claim or defence , if it is
not granted ."
21. This rule firstly gives the court a discretion , secondly , it also
requ ires the appl icant to demonstrate how it will be prejudiced
if the appl ication to strike out is not granted . In the matter of
Titties Ba r and Bottle Store (Pty) Ltd v ABC Garage (Pty) Ltd
1974 (4) SA 362 (T) at 368 F - H it was held that:
"Th e rules gives the court a discret ion and did
not make it obligator y to strike out a matter
which is scandalous ."
22. A perusal of th e anne xu res attached to the founding affidavit ,
and sourced from senior employees of SABC indicate that TNA
officials handled the acquis ition of that contract by devious
means. I am accordingly sat isfied that respondents are not in
any way prejudiced if there is no strik ing of the averments in
paragraph 16 .8, 17, 14 .2 as well as paragraph 53, and 41 up
to 48 of the aff idavits of Felity .
23 . The writers , Jacob and Goldrein , in the matter , in "Pleading
Princ iples and Practice ", at page 271 write as follows:
"Allega ti ons in a pleading are scandalous if
t hey state matter s which are indecent or
offens ive , or are made for the mere purpose
of abusing or prej udi cing the opposing party ."
24 . T he affidav it in the mai n application , deposed by Maseko . who
caref ully narrated how he was threatened and pressurised by
both the Gupta broth ers into al loc ating the TNA advertising
cont ract by the government is probably some of the evidence
the app licants will use to sho w the un acce ptable conduct by
TNA directors . The application to strike out is in the result
dism i ssed .
THE JO/NDER APPL/CATION
25 . It is trite law that the reason for joinder is usually convenience ,
time , effort and costs, are saved by joining parties or causes
of action in one action, instead of bringing separate
applications or actions . Apart from considerations of
convenience there are circumstances in which it becomes
essential to join a party because of the interest that that party
has in the matter.
26 . A party must be joined , if they have a legal interest in the
subject matter , not mere ly a financial one , which could be
prejudicially affected by the judgment. In the matter of Pheko
and Others v Ekurhuleni City 2015 (5) SA 600 (CC) Nkabinde
J held as follows :
"The test for joinder requires that a litigant
have a direct and substantial interest in the
subject matte r of the litigation , that is a legal
interest in the subject matter of the litigation ,
wh ich may be affected by the decision of the
court . This view of what constitutes a direct
and substantial interest has been explained
and endorsed in a number of decisions of our
courts ."
27 . Nkabinde J went on to refer , amongst others , to the judgment .
in National Union of Metal Workers of South Africa v lntervalve
Pty Ltd and Others 2015- (2) 8CLR 182 (CC). That matter
concerned an applica tio n by t he National Union of Metal
Workers of South Africa (NUMSA) to join lntervalve and BHR
as parties to unfair dismissal proceedings pending in the
Labour Court against Stein Muller. lntervalve , BHR, and Stein
Muller were associated companies with interlinked
shareholders and directors. They shared the same human
resource services. Nkabinde J held at paragraph 189 that they
had a direct and substantial interest in the proceedings on the
following basis, that they had a hand in the dismissal of some
of the employees, albeit through the medium of a shared HR
ser v ices entity , and that these _ entities acted jointly and in
single process to effec t the dismissa ls.
28 . In the matter of Internation al Trade Administratio n Serv ice
Commission v Scaw Metal, Sca w South Africa (Pty) Ltd 2012
(4) SA 618 (CC) a case that concerned an app lication for
certain int e rdictory relief in respect of anti-dumping duty ,
i mposed in respect of certain steel wire , rope products ,
imported from Breden International Limited (UK), the
applicant , Sca w, was a South African ent ity , and the
re sp ondents (ITA C ), a statutory body with the duty to make
recommendations to th e Minister of Trade and Industry.
Bred en sought leave to inter _vene in the applicat i on for leave
to appeal to the Constitutional court. Moseneke DCJ for the
court was satisfied that Brede n did indeed has a direct and
substantia l interest and he ld as follows:
"There can be no gainsaying that Breden UK
has a pressing commercia l interest in the fate
of the existing anti-dumping duties against its
products. For as long as this restraining
order is in place ITA.C and the two min isters
of state would be precluded from taking steps
that would bring the sunset review to fruition ,
and that may lead to the end of anti-dumping
du ti es. The duties would remain in force , to
the obvious commercial detriment of Breden
UK's potential exposure in so·uth Africa.".
29. It is against this background that I now consider whether it be
convenient to join the respondents , and if so , whether they
have a direct or substantial interest in the re.view application
set out in part B.
30 . In the opposing affidavits, as well as in their heads , the
respondents say firstly that they have no direct and substantial
interest in the outcome of the r'eview a pp I ica tic n. They then
proceed to raise three points in -limine . Firstly , that this court
has no jur isdiction in respect of the second and third
respondents (the Gupta brothers). Secondly , that any possible
claim against the respondents has prescribed , and lastl y that
th ere is no cause of action pleaded against the respondents.
JURISDICTION
31. The concep t "juri sd iction " is closely linked to the existence of
a set of leg al rules, and the au thority to take action on behalf
of the law. One of th e well-known rules is one of submission,
or consent.
32. In this matter both th e second and the third respondents have
submitted themselve s to the jurisdicti on of this court by
electing to accept se rvice of do cuments on them , at their
South African attorneys. This , to enab le t he m to participate
fully in the conduct of the proceedings. They fil ed oppo sing
affidavits, thus fully engaging with the proc ess of the South
African court. In th e matter of Jameson Nei l v Sab ingo Amindo
Cesar Case number 329/2000 SC A, heard on 21 February 2002
Fallam JA found that a letter written to the app el lant' s
attorneys by the respondent's attorneys constituted sufficient
submiss ion by Peregrinus to the court' s jurisd iction. At
paragraph 4 of that j udgment the Hono urabl e Judge quotes
that letter in full as follows:
"In light of the fact th at we repr ese nt our
client in South Afr ica, we confirm that
our client hereby consents to the
jurisdiction of the Witwatersrand Local
divis ion of th e High Court , in respect of
your client's action, and our client also
appoints ou r offices as his chosen
domicilium cita ndi et executandi for all
purposes. There is accordingly no need
for you to confirm the order already
obtained, or indeed to serve the order
for attachment of the judgment, and
there is also no need for the writ of
attachment which must have been
issued by yourselves in respect thereof
to be executed by the Sheriff . An
attachment Is now not necessary or
competent under the circumstances."
33. In American Flag PLC v Great African T-shi~t Corporation CC
2000 ('l) SA 36 (W) it was held that , even where there was no
other cause jurisdict ion is , such as that the contract sued on
was concluded in the court area of jurisdiction , where the
plaintiff was an incola in an action for money, submission to
the ju risdiction by the perigrinus defendant was effective .
34 . The agreement , which is the subject matter of the review
appli c ation was concluded in this court 's jurisdiction and the
respondents have not disputed that. The respondents, through
their own attorneys , have conceded that all processes in this
matter be served on the attorneys , as their chosen domicilium .
They l1ave in the result unilaterally submitted themselves to
the jurisdiction of this court. The court further held that a
j udgme nt given by a court against a peregrinus who has
submitted to its ju ri sd ir.ti nn w ill be internationally enforceable
and will be recognise by the cou rt of the judgment debtor 's
dom icile.
PRESCRIPTION
35 . The respondents argue that a claim against them and the
company TNA Media has become prescribed . This can never
be correct . It is a plea that the respondents are free to raise
in th e ir an swerin g affidavit to the main appl ication . It is in that
cour t w here a dec ision w il l be made about prescription .
36 . The respo ndents mainta in that the applicants have not
atte mpted to de f ine the nature of the claim that SABC could
po ss ibly have aga inst TNA . They presume it could on ly be in
the form of an enrichment claim , and if so , such a cla im is
ag ainst T NA , and not against TNA d irectors . If the debt
against TNA has p rescribed . the same applies to the di recto rs .
37 . Th e fo urth resp ondent , Gary Naidoo , fil ed the oppos ing
affid avit o n be half of all the respondents , and in paragraphs
77.5 of his affidavit he says that the cause of action , if a ny,
arose in Ju ne 2018 , wh ich is the date on which , acco rd ing to
th e m, the applic ants became aware of the purported facts
leading to the cl aim. As a res u lt tha t c la im prescribed on 7
June 2 02 1.
38 . It is trit e law th at i n te rms of Section 12 (3) of the Pres cript ion
Act , a debt fa lls due whe n a cred itor acqu ires knowledge of all
the facts giving rise to tt1e de b t. The difference concerning
the facts in this matter is that a rev iew application must first
decide on the validity or otherwise of th e impugned contract,
and until such time no prescription can run against the
applicant 's possible claim.
39 . The issue of prescription was raised and dealt with by the full
court in the matter of SA Broadcasting Corporation (SOS
Limited and another) v Motsoeneng and Others
(A2022 /046784) (2024) ZAGP JAC 688. The majority decision
by Wilson J and Mud au J held that:
"A debt to the state aris ing from an
unlawfu l administrative act falls due
when the act is set aside . In other
words , when the act ceases to stand as
a fac t."
40 . The cour t in Trinity Asset Management (Pty) Ltd v Grindstone
In vestmen t 132 (Pty) Ltd 2018 (1) SA 94 (CC) held that:
" It is a fundamental principle of
prescription that it will begin to run , only
when the creditor is in a position to
enforce his right in law , not necessari ly
when that rig ht arises ."
41. In pa ragraph 22 of SABC the court held as follows:
"It follows from this that a pa rty wishing
to recover a debt that will be due , but
for an unl awful adm in ist rative action
must first ~et that debt aside , before the
debt can be claimed .'"
42. Accordingl y this point re garding prescription is based on
wrong in terpretation and understandi ng o_f Section 12(3) of the
Prescription Act , and falls to be dismissed.
43 . The next defence made by the respondent is that there is no
cause of act ion demonstrated on the papers to hold the
respondents li able for debts or action of the company , TNA .
The respondents allege th at , notwithstanding the provisions of
Sect ion 77 of the Company's Act , which deals with potential
liabi li ty of di re ctors of a company . there is according to them
no facts alle ge d by the appl icants against the respondents to
• : • ' ) • ,. : • • I
attract any personal li ability .
44 . Once again , the respondents wished to turn a blind eye to the
report and finding s of the Stat e Capture Commission , as well
as those of the SIU, which clearly indicate that TNA Media
directors were complicit in the ir maleficence , fraud , and /or
corrupt ion that occurred in the negotiations and conclusion of
the agreements between TNA Media and the SABC .
45 . That cau se of action will be clearly set out in the
supplement ary affid avit in support of the review appl ication ,
and It is only at that stage that the respondents are at will, or
be free to f ile exceptions to the app lic ation as not disclosing
any cause of ac tion in terms of Rule 23 of the Uniform Rules
of Cou rt.
THE DIRECT AND SUBSTANTIAL l~TEREST IN THE MATTER
46 . It is trite law that the tes t t o determine whether a party has to
be joined has been at direct and substantial interest. Direct
and substantial interest has been held to mean , an interest in
the right wh ich is the subject matter of the litigation , and not
me rely a financ ial interest , which is only an indirect interest in
such lit igat ion.
4 7. In t he matte r of Amalgama ted Engineering Union v Minister of
Labou r 1949 (3) SA 637 at 659 it was held as follows :
"I ndeed it seems clear to me that the
co urt has consi stently refrained from
.dealing wi th iss ues i'n which a third
party may have a direct and substantial
in teres t, wi thout either having that party
jo ined in the SU it , or if the
circumstances of a case admit of such
a cause , taking other adequate steps to
ensure tha t i ts judgment will not
prejudicially
interes t. "
affect
I
that party 's
48 . It is not i n d ispu te tha t the respondents were , all of them , ,.
directo rs of TNA Media at the time of the conclusion of the
con t ract . Both the SABC as well as the SIU have indicated
th at , once a joi nde r :1p p ti ·:rt tion sh a 11 have been granted they
int ~nd to arn en ci the reli ef ~o t.:yhi: ii''l tl1e review c1pplication , to
include a ji..s t and equitab!E: , emt.;d y, that che damages suffered
by the Sf\BC tram th e irre g ular appointment of TNA Media be
recov 0re d f rom th e direc tors of TNA Media.
49 . The respon dents therefore have a d irect and substantial
interest in the ul ti mate outcome of the review application . The
respo ndents have not demonstrated that they have no direct
and sub;;tantial int erest in the subject matter of the revi,ew
app li cat ion . Thi s court agrees with the appl icant 's content ion
that the re sp ond e nts have mere ly f iled opposition to this
appl ication for purposes of dela y, and to avoid accountability
t • •••
for t11eIr participat io n in the irregularities that occurred
• r. . ! • , • . , : : 1 : • , ' ::.. :
betwe en SABC and TNA Media .
50 . The: jo1nd e r of the respondents will serve to avoid duplicat ion
of lega: expenses. The relief sought by the app lic ants in the . . .
main application cannot be sustained or carried into effect . . . .
without pre judi cing the respondents. In the event the court in
the review application finds in favou r of the applicant , then it
goes w ithout saying that the erstw hi le directors of TNA Media
should join tly and severally be held li ab le for the losses
incurred by SABC, due to the u nlawful contracts concluded
with their knowledg e and the act ive participat ion of the
directors.
51. I am satisfied that, based on the grounds set out above , the
test for joining th e responde nts has been satisfied . I n the
res ult I make the foll owin g order .
ORDER
1. The first , second , third an d fo urth re spo nden ts are hereby
joined as the third , fourth, fifth and sixt h respondents in the
review application betwe en app lican ts and TNA Media under
cas e umber 16694/1 8.
2. The respondents are ordered to pay th e costs of t his
applicat ion , i ncludin g the co sts of two cou nse l.
MAKUMEJ
JUDGE OF THE HIGH COURT
JOHANNESBURG
Appearance
For the Applicant :
Instructed by:
For the Respondent :
Instructed by:
Adv Jabu Motepe SC
Werksmans Attorneys
Adv Michael Hellens SC
Adv Leon Van Gass
Dockrat Attorneys