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[2026] ZAGPJHC 546
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Moller N.O. v Hoffman and Others (2024/059973) [2026] ZAGPJHC 546 (18 May 2026)
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REPUBLIC OF SOUTH
AFRICA
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
JOHANNESBURG
Case
Number: 2024-059973
(1)
REPORTABLE: NO
(2)
OF INTEREST TO OTHER JUDGES: NO
(3)
REVISED: NO
In the matter between:
PIETER
MÖLLER N.O.
Applicant
and
NICOLAAS
HOFFMAN
First Respondent
GIDEON
PIERRE JOUBERT
Second Respondent
SUPREME
HEAT TREATMENT (PTY) LTD
Third Respondent
SCOTOPS
PROPERTY (PTY) LTD
Fourth Respondent
SHT
PRODUCTION (PTY) LTD
Fifth Respondent
JUDGMENT
DJ Smit, AJ
Introduction
[1]
The applicant (
Mr
Möller
) is the executor of the
estate of the late Mr Derick Hutchison, who passed away on 30 June
2023. Mr Möller applies in his
official capacity for rescission
of an order made on 18 September 2024 (
the
order
) in default of his appearance.
[2]
The order compelled him to deliver to the
first and second respondents (
Mr Hoffman
and
Mr
Joubert
, respectively) the original
share certificates in respect of shares the deceased held in three
private companies: the third respondent
(
Supreme
Heat
), the fourth respondent (
Scotops
)
and the fifth respondent (
SHT
).
The certificates were to be delivered against a tender of payment for
the shares. Mr Möller was also ordered to sign share
transfer
forms. If he disobeyed the order, the sheriff was directed to enforce
compliance. Mr Möller was also ordered to pay
costs on a
punitive scale.
[3]
This
case was argued on the basis that compliance with the order made Mr
Hoffman and Mr Joubert the owners of the shares. I express
no view on
that topic, which is irrelevant to this judgment. This judgment
concerns whether there is “
sufficient
cause
”
to set aside the order (which is the test at common law).
[1]
[4]
The
existence of “
sufficient
cause
”
depends on whether: (a) the applicant has presented a reasonable and
acceptable explanation of his default;
and
(b) the applicant has shown the existence of a
bona
fide
defence, i.e. one that has some prospect or probability of success.
These requirements are conjunctive.
[2]
[5]
I find below that Mr Möller’s
reasons for failing to appear were relatively weak but that, even if
they were stronger,
I would not have granted a rescission of the
order because of the weakness of the defence envisaged on the papers.
Background
[6]
Messrs Hutchison, Hoffman and Joubert were,
at least in ordinary parlance, business partners. They were co-owners
of Supreme Heat,
Scotops and SHT although Mr Hutchison held the
lion’s share (63%) of the shares in Supreme Heat and Scotops.
They co-owned
SHT in equal shares. A Mr Nobrega held a 7% share in in
Supreme Heat and Scotops, but his position is not relevant to this
application.
[7]
Messrs Hutchison, Hoffman and Joubert were
the only directors of Supreme Heat, Scotops and SHT until the death
of the deceased.
[8]
Supreme Heat was, at first, a close
corporation but it was converted in 1989 to a private company. Messrs
Hutchison, Hoffman and
Joubert were directors of Supreme Heat from
when it was a private company, i.e. for more than three decades.
Supreme Heat carries
on business in Germiston. It provides heat
treatment and hardening of steel and related materials.
[9]
Scotops was incorporated in 2004. It owns
the premises from which Supreme Heat carries on its business.
[10]
SHT was incorporated in 2017. It employs
persons who provide labour to Supreme Heat.
[11]
The heart of the dispute between Mr Möller
(as executor), on the one hand, and Messrs Hoffman and Joubert on the
other, is
whether Messrs Hoffman and Joubert are entitled under a
contract (which, like the parties, I refer to as the “second
agreement”)
to a deemed sale of the shares in the three
companies concerned to them on the death of Mr Hutchison.
[12]
Messrs Hoffman and Joubert’s evidence
– not meaningfully contested by Mr Möller – is that
they concluded
an association agreement with Mr Hutchison while
Supreme Heat was still a close corporation. This agreement provided,
similarly
to the second agreement, for the disposal of the members’
interest in Supreme Heat upon the death or disability of a member.
After conversion of Supreme Heat to a private company, it was
discussed and orally agreed between the parties that a shareholders’
agreement would provide for the surviving shareholders to acquire the
shares of a deceased shareholder, funded through life assurance.
The
parties took out a life insurance policy which eventually would fund
such a purchase.
[13]
Sometime in 2006, after registration of
Scotops, the parties agreed to formalise an agreement in that regard.
A draft “Purchase
and Sale” agreement was prepared but
apparently not signed. During or about early April 2011, however,
two
agreements were signed using the template prepared in 2006:
a.
An agreement styled “
Purchase
and Sale Agreement (Partnership – three or more partners)
Supreme Heat Treatment (Pty) Ltd and Scotops (Pty) Ltd
(automatic
sale of partnership interest and claim at the death, withdrawal or
disablement of a partner
”. The
last party to this agreement signed it on 4 April 2011. This is why
it’s called the “first agreement”
by the parties.
b.
An identical agreement save that no
reference is made to Supreme Heat and Scotops and that the last party
in time to sign, signed
it on 5 April (and not on 4 April) 2011. This
is why it’s called the “second agreement” by the
parties.
[14]
In later years, the business partnership
appears to have been unhappy, and allegations are made of untoward or
at least unwise business
practices. Nothing turns on them, for
present purposes; since neither the first nor the second agreement
seems to have been expressly
amended or revoked. There are
indications that Mr Hutchison sought advice in that regard from Mr
Möller, who is also an attorney,
but Mr Möller –
perhaps understandably – did not disclose the tenor of these
discussions with Mr Hutchison.
[15]
After Mr Hutchison passed away, disputes
erupted including regarding the ownership of the shares. The disputes
led to several urgent
and other applications, some of which are still
ongoing, as well as the application for what is described as transfer
of the shares
(
transfer application
).
[16]
In the transfer application, Messrs Hoffman
and Joubert tendered 63% of the value of the shares in Supreme Heat
and Scotops, as
valued by their auditor (at R5.6 million). They
contend that the shares in SHT have no value, because SHT has no
assets.
[17]
The
parties seem to have initially envisaged that the court should, at
this hearing, determine the costs of various interlocutory
applications ancillary to the rescission application, but at the
hearing they were agreed that I could ignore them and that either
of
the parties could set them (or some of them) down for determination
as and when so advised. This was appropriate, given what
could only
be described as the chaotic state of the CaseLines folder and the
parties’ lack of diligence in agreeing to a
joint practice note
which delineates the issues.
[3]
A reasonable and
acceptable explanation for the default
[18]
Messrs Hoffman and Joubert brought the
transfer application in May 2024 (
transfer
application
), during but not as part of
ongoing separate litigation with Mr Möller, as executor.
Although Mr Möller is also an attorney,
he instructed his
current attorney in those other matters. There is no dispute that Mr
Möller received personal service of
the transfer application.
[19]
Mr Möller’s explanation for his
failure to enter an appearance to oppose is that, on receipt of the
transfer application,
he assumed that Messrs Hoffman and Joubert
would serve the application on his attorney too or would at least
alert his attorney
to the application. The basis for this assumption
is that the attorney acting for Messrs Hoffman and Joubert knew of
the identity
and involvement of Mr Möller’s attorney and
in the other legal matters copied “
each
of the role-players … on correspondence exchanged between the
parties, as well as the service of legal notices and documents
concerning pending litigation
”.
[20]
Mr Möller states that when the
transfer application was served on him, he “
took
it for granted that [his attorney] had also been appraised thereof,
one way or another, and that he would attend thereto
”.
[21]
It goes almost without saying that these
were dangerous and unwarranted assumptions. There was no agreement
that Mr Möller’s
attorney would always be served with
documents, including new litigation. There was also no obligation in
terms of the Rules of
Court for the transfer application to be served
on his attorney, although it would have been courteous to do so.
[22]
Further, it was unreasonable for Mr Möller
not to have, at least, followed up with his attorney regarding
receipt of the application.
Mr Möller, as an attorney, knew that
an appearance to oppose had to be entered; and that an answering
affidavit was due within
a relatively short period after that.
Axiomatically, his attorney did not contact him for instructions in
this regard. This should
have struck him as strange and alarming long
before the order was taken in September 2024 (more than three months
after the transfer
application was served on Mr Möller) and he
should have made enquiries in that regard.
[23]
It follows that Mr Möller was at least
negligent in not entering an appearance to oppose. Messrs Joubert and
Hoffman contend
that he was in wilful default or at least grossly
negligent.
[24]
Although
nothing turns on this, I do not consider Mr Möller to have been
in wilful default. The case law makes it clear that
for a party to be
in wilful default, he or she must have – with full knowledge of
the risks attendant on default –
taken a decision not to
appear.
[4]
Mr Möller did
not to take a decision not to appear. He (unreasonably) assumed his
attorney would appear on his behalf without
him prompting the
attorney to do so.
[25]
This
does not mean Mr Möller’s relatively weak explanation is
irrelevant. A court seized with a rescission application
may
excuse even wilful default if it is accompanied by a strong
defence.
[5]
Concomitantly, if Mr
Möller’s reason for his default had been innocent, a court
could have overlooked even a relatively
weak defence (even though it
must, of course, have some prospects of success).
Mr
Möller’s defence on the merits of the transfer application
[26]
In this case, both Mr Möller
explanation for his default as well as the defence proffered on the
merits, are weak. This means
that the application for rescission
should be dismissed.
[27]
It is not easy to encapsulate Mr Möller’s
defence, as set out in his founding affidavit in the rescission
application.
It appears to be that the second agreement (but,
importantly,
not
the first agreement) is invalid and unenforceable. The reasons for
the unenforceability are said to be the following:
a.
The second agreement is void for vagueness
because it does not reflect the names of Supreme Heat or Scotops or
any other company.
b.
The second agreement (like the first)
refers to “
a former partner’s
”
“
interest
”
in and “
claims
”
against a partnership; not to shares in a company or companies.
(Although the first agreement refers, of course, explicitly
to
Supreme Heat and Scotops.)
c.
Messrs Joubert and Hoffman initially relied
in preceding urgent proceedings on the first agreement. They
contended initially that
the first agreement applied, which did not
refer to the shares in SHT.
d.
Both agreements are, on Messrs Joubert and
Hoffman’s own version, spliced versions consisting of a mix of
original pages and
photocopied pages without any explanation how or
why this was done.
e.
Messrs Joubert and Hoffman do not explain,
adequately, or at all, why the parties signed two agreements a day
apart. The explanation
appears to be that someone has attempted to
“
splice
”
together an agreement to acquire the deceased’s shareholding in
all three companies and did a bad job in doing so.
[28]
Thus, Mr Möller’s counsel
submitted that it cannot be said on a plain reading of the second
agreement that the parties
thereto were
ad
idem
that the second agreement was
intended to refer to Supreme Heat, Scotops and SHT, which was not in
existence at the time, and to
the parties’ respective
shareholding in such companies.
[29]
Messrs Hoffman and Joubert contend, on the
other hand:
a.
It is obvious that the second agreement was
intended to refer to and deal with their shareholding, together with
the deceased’s
shareholding, in Supreme Heat and Scotops, as
well as SHT, which was not registered at the time when the second
agreement was concluded.
The reason why the second agreement did not
in terms refer to Supreme Heat and Scotops is precisely that it was
contemplated that
the parties may, after 2011, register further
businesses.
b.
Mr Möller has no personal knowledge of
how the first or second agreement came into being. He relies simply
on suspicion and
baseless conjecture, as opposed to the actual
knowledge of Messrs Hoffman and Joubert.
c.
The reason why, at first, they relied on
the first agreement was because they only found the second agreement
in February 2024.
Nothing turns on this, in any event, because the
first agreement would in substance have the same effect as the second
agreement.
Although the first agreement does not refer to SHT, the
shares in SHT have no value.
d.
It would thus have been more beneficial for
Messrs Hoffman and Joubert to continue to rely on the first
agreement, but they did
not do so because they found the second
agreement. They relied on it simply because it exists.
e.
Mr Möller acknowledged in
correspondence before litigation that an agreement exists in terms of
which the shareholding of (at
least) Supreme Heat would be deemed to
be sold upon the death of Mr Hutchison. He also stated that he knew
Mr Hutchison’s
“
intent
”
in that regard, but he failed to say what the intent was.
[30]
It seems that Mr Möller’s case
proceeded on the assumption that the second agreement revoked the
first agreement. It
is common cause that both agreements provide in
clause 13 that “
[t]he p
rovisions
of this agreement have precedence over any provisions to the contrary
contained in any other agreement that the parties
have entered into
with each other.
”
[31]
A major difficulty facing Mr Möller is
that, if the second agreement is invalid and unenforceable, as he
contends, or even
if it refers to something other than the shares in
Supreme Heat and Scotops, it did not revoke the first agreement. In
that case,
he would have no defence against the transfer application
save insofar in respect of the SHT shares (which are apparently
valueless).
Thus, if I understood Mr Möller’s case
correctly and he attacks only the validity of the second agreement,
the application
should fail save perhaps regarding the transfer of
the SHT shares.
[32]
In case, however, I misunderstood Mr
Möller’s case, I consider his remaining bases of attack.
[33]
In my view, the second agreement is not
void for vagueness because it does not reflect the names of Supreme
Heat or Scotops or of
any other company or because it refers to
“
partners’ interests
”
rather than shares.
[34]
A
contract has to be interpreted in light of the circumstances
attendant upon its coming into existence, the apparent purpose to
which it is directed and the material known to those responsible for
its production (among other factors). A sensible meaning is
to be
preferred to one that leads to insensible or unbusinesslike results
or undermines the apparent purpose of the contract.
[6]
[35]
When the second agreement was signed –
and I should make it clear that Mr Möller at no stage
disputed Mr Hutchinson’s
signature – the parties knew
that:
a.
They had been for decades engaged in what
in ordinary parlance would be described as a business partnership.
(Concomitantly, in
law one often describes a closely-held company
such as Supreme Heat as “
an
incorporated partnership
”.)
b.
The parties had incorporated another
company, Scotops, and it was possible that they would incorporate
further companies in future.
c.
They had been desirous from the time when
Supreme Heat was a close corporation to arrange for the situation
whether a partner should
pass away through a transfer of his
ownership interests to the other parties, financed by life insurance.
[36]
Against this backdrop – and without
even taking account of the directly preceding first agreement –
it seems obvious
that the partnership referred to in the second
agreement refers to the parties’ joint business ventures
carried on through
Supreme Heat and Scotops, and which may in future
be carried on through other entities. The interpretation of the
second agreement
is therefore straightforward.
[37]
In
addition, Messrs Jobert and Hoffman gave direct evidence on affidavit
identifying the “
partnership
”
and the “
interests
”
with which the second agreement deals. Even before the paradigm shift
in contractual interpretation brought about by the
Supreme Court of
Appeal’s judgment in
Endumeni
[7]
,
as continued and expanded by the Constitutional Court in
University
of Johannesburg
[8]
,
such evidence was admissible to identify the persons, things, or
factual setting to which a document refers, or to apply a contract
to
the relevant facts.
[9]
[38]
The other issues raised by Mr Möller’s
defence are rightly described as attempts to cast suspicion devoid of
facts to
back it up. It is as well to be reminded of the following
dicta
of
the Supreme Court of Appeal:
“
Whatever
place mere suspicion of malfeasance or moral turpitude might have in
other discourse, it has no place in the courts –
neither in the
evidence nor in the atmosphere in which cases are conducted. It is
unfair, if not improper, to impute malfeasance
or moral turpitude by
innuendo and suggestion. A litigant who alleges such conduct must do
so openly and forthrightly so as to
allow the person accused a fair
opportunity to respond. It is also prejudicial to the judicial
process if cases are adjudicated
with innuendo and suggestion
hovering in the air without the allegations being clearly
articulated. Confidence in the process is
built on transparency and
that calls for the grounds upon which cases are argued and decided to
be openly ventilated.
”
[10]
[39]
If Mr Möller meant to say that Messrs
Joubert or Hoffman forged the second agreement to achieve transfer of
the shares in SHT
(in addition to those in Supreme Heat and Scotops),
he should have said so and should have proffered evidence of forgery,
if necessary
of an expert nature. He did not. And there appears to be
no obvious reason why they would do so, in light of their uncontested
evidence that the SHT shares have no value.
[40]
The same holds true for the issues
regarding the late discovery of the second agreement and the
so-called “
splicing
”
of the agreements:
a.
It is not uncommon for parties to
litigation to scour their records for documents that may bear on a
case. The discovery of the
second agreement also did not
fundamentally alter the position between the parties. There seems to
be no reason why Messrs Joubert
or Hoffman would lie about the
discovery.
b.
As for the “
splicing
”,
neither Messrs Joubert and Hoffman, nor Mr Möller explain why it
appears as if some pages from the one agreement found
their way into
the other. Messrs Joubert and Hoffman deal with this openly in their
founding affidavit in the transfer application.
There could be any
number of innocent explanations for it but, perhaps appropriately,
they did not speculate. Mr Möller did
not accuse them directly
of wrongdoing, thereby perhaps recognising that the splicing may have
come about in an innocent way.
[41]
In the circumstances, Mr Möller’s
allegations in his founding affidavit do not cast significant doubt
on Messrs Joubert
and Hoffman’s entitlement to transfer of the
shares, as recognised in the order sought to be rescinded. Together
with Mr
Möller’s weak explanation for his default in
appearing, this means that his application for rescission should be
dismissed.
Costs
[42]
Messrs Joubert and Hoffman sought punitive
costs against Mr Möller (in his representative capacity as the
executor, meaning
that such costs would be paid by the estate of Mr
Hutchison). It seems to me that punitive costs are justified because
Mr Möller’s
default was caused by, at the very least,
negligence and that his defence is speculative.
[43]
Counsel
also sought to motivate that the costs should be taxed on scale C.
Counsel was unable to assist with authority on whether
it is
appropriate to make an order for both punitive costs and for
counsel’s costs to be taxed on scale C. It seems to me
that
Rules 67A and 69, which created and regulate scales A to C, only
applies to party-and-party costs. Therefore, if attorney-and-client
costs are awarded, counsel’s fees are not subject to the scales
set out in Rule 69; the only question is whether they have
been
reasonably incurred.
[11]
Order
[44]
I therefore make the following order:
a.
The application for rescission is
dismissed.
b.
The applicant shall pay the costs of the
application for rescission, such costs to be taxed as between
attorney and client.
DJ SMIT
ACTING JUDGE OF THE
HIGH COURT
JOHANNESBURG
Date of hearing: 3 March
2026
Date of judgment: 18 May
2026
For the Applicant:
HP
West instructed by Chris Liebenberg Attorneys
For
the Respondents:
S Symon SC with RG Cohen
instructed by Glynnis Cohen Attorney
[1]
Harris
v Absa Bank Ltd t/a Volkskas
2006
(4) SA 527
(T) para 4. Mr Möller expressly brought the
application under the common law.
[2]
Harris
(supra)
paras
4-5
[3]
Each
party filed multiple separate practice notes and the applicant,
without explanation for the failure to file a true joint
practice
note, filed a unilateral practice note styled “joint practice
note”.
[4]
Harris
(supra)
paras
7-8 and the cases quoted there.
[5]
Harris
(supra)
para
10.
[6]
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012 (4) SA 593
(SCA) para 18 endorsed by the Constitutional Court
in
Independent
Institute of Education (Pty) Ltd v KwaZulu-Natal Law Society
2020 (2) SA 325
(CC) para 41.
[7]
Supra
[8]
University
of Johannesburg v Auckland Park Theological Seminary
2021
(6) SA 1 (CC).
[9]
Delmas
Milling Co Ltd v Du Plessis
1955 (3) SA 447
(A) at 454F-H.
[10]
Allpay
Consolidated Investment Holdings (Pty) Ltd v Chief Executive
Officer, South African Social Security Agency
2013 (4) SA 557
(SCA) para 4.
[11]
See
also the cases cited in
Erasmus:
Superior Court Practice
RS
28, 2025, D1 Rule 67A-1 footnote 22.