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[2026] ZAGPJHC 577
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Cos Consult CC v Basil Read Limited and Others (2024/067809) [2026] ZAGPJHC 577 (21 May 2026)
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IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, JOHANNESBURG)
CASE
NO: 2024/067809
(1)
REPORTABLE: NO
(2)
OF INTEREST TO OTHER JUDGES: NO
(3)
REVISED.
In
the matter between:-
COS
CONSULT
CC
Applicant
and
BASIL
READ LIMITED
(in Business Rescue)
First Respondent
JOHN
DYMOKE LIGHTFOOT N.O.
Second Respondent
SIVIWE
DONGWANA
N.O.
Third Respondent
RETIRED
JUDGE MEYER JOFFE
Fourth Respondent
JUDGMENT
ALLEN
AJ
INTRODUCTION
[1]
This is an opposed application to review and set aside the decision
by fourth respondent concerning applicant’s
claims brought
against first respondent. Applicant seeks an order in the following
terms:
“
1.
The findings and conclusions made in paragraph 67 to 73 of the fourth
respondent’s award, handed
down on 29 February 2024 (“the
Award”) are reviewed and set aside.
2.
That paragraphs 67 to 73 of the Award are replaced with the
following:
a.
the second and third defendants are to recognise, in accordance with
the Plan, the claimant's claims
against the first defendant of:
i.
R50 836 127.31, together with interest thereon; and
ii.
R8 970 000.00, together with interest thereon,
b.
it is declared that the claimant has an in-principle entitlement
under the Management Agreement,
the quantum of which is held over for
determination at a later stage, and
c.
that claimant's costs in the dispute under section 40 of the business
rescue plan are to
be paid by the first, second and third defendants
jointly and severally, the one paying, the other to be absolved, on
the attorney
and client scale.
3.
The applicant's costs in its review application are to be paid by the
first, second and third applicants
jointly and severally, the one
paying, the others to be absolved, on the attorney and client scale,
and
4.
Further and/or alternate relief.”
BACKGROUND
[2]
The first respondent was appointed by Eskom to construct certain
portions of the Medupi Power Station in Limpopo, appointed
under
three contracts. First respondent entered into five contracts with
applicant to effectively manage the commercial and contractual
aspects of its three contracts with Eskom. The Ash Dumps Management
Agreement and the Clarifiers Management Agreement were described
as
the management agreements. These agreements pertain to the management
of the claim compilation and dispute process by applicant
on behalf
of first respondent in relation to its contracts with Eskom which
included the management of claims submitted to first
respondent by
its various sub-contractors.
[3]
The Ash Dumps Services Agreement, the Clarifiers Services Agreement
and the Miscellaneous Buildings Services Agreement
were described as
the services agreements. These agreements required applicant to
provide contract specific documentation as well
as to attend to site
support, to guide and train first respondent’s commercial team
in the effective management and issue
of notices to Eskom as required
in the respective main contracts.
[4]
On 29 August 2012 applicant and first respondent amended the terms of
the services agreements and management agreements
and at the hearing
agreed that the terms of the aforementioned agreements as well as
their respective amendments are not in dispute.
The parties also
agreed on a structure for payments and “all amounts not
finalized in terms of the main contract are to be
finalized with the
participation and agreement of COS Consult”. The parties
further agreed that under the main contracts,
there are two means by
which the quantum of the contract can be altered that is clause 13
“Variations and Adjustments”
and Clause 20 “Claims,
Disputes and Arbitration”.
[5]
Initially applicant was paid by first respondent in terms of each of
the agreements and in May 2015 first respondent sought
to bring to an
end the agreements with applicant on the contention that same had
been terminated by mutual agreement between the
parties. Applicant
disputed this whereafter first respondent issued a summons during
August 2015 and the Honourable Retired Judge
Cloete resolved at
arbitration that the five agreements had not been terminated and
remained extant.
[6]
First respondent was hereafter placed in business rescue with second
and third respondents as the business rescue practitioners
(BRPs).
Applicant submitted each of its claims in terms of the five
agreements.
[7]
On 5 July 2018 the BRPs sent a first update to its creditors which,
amongst other, read: “
9. However, at this
stage, the company cannot commit to a position where it
can definitively
continue to engage you for the
provision of your further
services
during Business Rescue and as such,
such
services are currently
suspended
until further notice from the Business Rescue
Practitioners. This
position may change
once we have clarity on the level of post
commencement
funding and how it will be allocated to contracts…”
(Own
emphasis)
[8]
On 24 July 2018 the BRPs confirmed that the supply of goods and
services must only take place if specifically authorized
in writing
by the BRPs. The BRPs at no time engaged with applicant regarding
services performed, the manner in which it assisted
first respondent
in the past, and the continuance to assist during business rescue.
[9]
On 27 September 2018 the Business Rescue Plan (the Plan) was adopted
by majority vote of creditors. On 21 November 2018
applicant
submitted further information in respect of its claims to the BRPs at
their request. Applicant hereafter followed up
with the BRPs,
regularly sent each invoice and tendered to perform its services as
set out in each of the five agreements. On 31
May 2019 the claims
were rejected in full without reasons or explanation.
[10]
Applicant initiated a dispute in terms of section 40 of the Business
Rescue Plan which provides for the determination
of disputes in
respect of claims by creditors. The fourth respondent, the Honourable
Retired Judge Meyer Joffe, was appointed by
the parties as the Expert
to determine the dispute regarding the claims submitted.
[11]
Applicant requested completion certificates from first respondent and
a number of “settlement agreements”
were produced which,
amongst other, contains a performance certificate that first
respondent is considered to have completed all
obligations in terms
of each contract on 30 September 2021 and confirmed the final agreed
contract price of R1 874 534 891.61
in full and final settlement
of all monies first respondent is entitled to, under or in connection
with the ash dumps and dams
main contract. The clarifiers settlement
agreement records that the completion of the works has been achieved
on 4 June 2021 and
a formal taking over certificate for all sections
was issued on the same day. It also contains a taking over
certificate from the
engineer which states that the works have been
substantially completed in terms of the clarifiers main contract and
confirms the
final agreed contract price of R208 543 683.01 in full
and final settlement of all monies first respondent is entitled to,
under
or in connection with the clarifiers main contract. The total
amount
R 2 083 078 574,62.
[12]
No settlement agreement in respect of the miscellaneous buildings
main contract was produced by first respondent. No
final payment
certificates have been produced by first respondent.
[13]
According to the agreed facts, what remained in dispute was also
detailed in a statement. The statement of agreed facts
was placed
before the Expert and after the hearing, the Expert rendered his
Award on 29 February 2024.
[14]
The parties communicated as to the effect of the Award and that
certain facts were agreed between the parties prior to
the hearing
and not confirmed by the Expert.
[15]
In light of the response from the BRPs, applicant seeks the portion
of the award as set out in paragraphs 67 - 73 of
the Award be
reviewed and set aside and replaced with a different order.
[16]
Applicant contends that the mentioned portion of the Award dismissing
the agreed amounts constitutes a gross irregularity
and a manifest
error that is a reviewable irregularity. The Expert misconstrued the
issue that he was called on to decide, had
regard to irrelevant
considerations and disregarded relevant considerations, in particular
that the pre-commencement amount was
admitted in the pleadings, in
the statement of agreed facts and in the heads of argument filed on
behalf of the BRPs. In addition,
since there is no connection between
the facts and evidence presented and the Expert's finding, the Award
is also irrational on
this ground.
DISCUSSION
[17]
The statement of agreed facts before the Expert consists of some 15
pages of which
inter alia
reads:
“
THE ADMITED
PORTION OF COS CONSULT’S CLAIM
33. Basil Read initially
persisted in its denial of COS Consult’s claims. However, in an
amendment dated 28 August 2023,
the BRPs admitted all of COS
Consult’s claims to 15 June 2018
, the date on which
business rescue proceedings commenced.
35.
The above amounts
(which sum R 50 836 127,31) together with interest thereon, are
admitted by the BRPs and shall dealt with in accordance
with the
provisions of the Plan
.
THE DISPUTED PORTION OF
COS CONSULT’S CLAIM
36. What remains in
dispute is:
36.1. whether COS Consult
has an entitlement in principle under the Management Agreements (as
pleaded in paragraphs 59 and 78 of
the statement of claim); and
36.2. whether COS Consult
has any entitlement to any amount which became due in terms of the
Service Agreements or the Management
Agreements during business
rescue proceedings (or after 16 June 2018).
37. COS Consult’s
remaining claims fall into two categories:
37.1. the amount that is
due under the Service Agreements after 16 June 2018; and
37.2. the amount that is
due under the Management Agreements after 16 June 2018. In
consequence of the agreed separation, the quantum
portion of this
claim is to stand over for determination at a later point.
The amounts claimed
under the Service Agreements post-15 June 2018
38. The capital portion
of COS Consult’s claims arising after 15 June 2018 is (to end
October 2023), R 8 970 000.00 comprised
of the following amounts:
38.1. …
THE ISSUES TO BE
DETERMINED
39. In light of the above
agreed facts,
the arbitrator is to determine
whether:
39.1. The BRPs suspended
the contracts between Basil Read and COS Consult in terms of
section
136(2)
of the
Companies Act 71 of 2008
;
39.2. COS Consult has an
entitlement to any amount which became due under the Service
Agreements during business rescue proceedings;
39.3.
commercial/contractual close out has been proved to have occurred
(and if so, on what date);
39.4. COS Consult has an
entitlement in principle to any amount under the Management
Agreements (paragraphs 59 and 78 of the statement
of claim) and, if
so, whether it has an entitlement to any amounts which became due
under the Management Agreements during business
rescue proceedings;
and
39.5. either party is
liable for the costs of the arbitration that have been incurred thus
far and, if so, which party and in what
proportion.
41.
If it is found
that the BRPs did not properly exercise the power granted under
section 136(2)
of the
Companies Act, then
:
41.1. the admitted
amount of R 50 836 127.31, together with interest thereon, stands to
be confirmed as owing by Basil Read to COS
Consult and dealt with in
accordance with the Plan; 41.2. the amount of R 8 970 000.00,
together with interest thereon, stands
to be confirmed as owing by
Basil Read to COS Consult and dealt with in accordance with the Plan
;
and
42. If it should be found
that COS Consult has an in-principle entitlement to any amount under
the Management Agreements and that
the BRPs did not properly
exercise the power granted under
section 136(2)
of the
Companies Act
>,
then:
42.1. it should be found
that
COS Consult is entitled to payment under the Management
Agreements,
which amount is to be held over for determination in
due course”. (Own emphasis)
[18]
On 29 February 2024 the Expert rendered his Award wherein it was
inter alia
said:
”
9. CC's counsel
set out in their heads of argument what they described as the
"undisputed facts". These undisputed facts
are gleaned from
admissions on the pleadings, Mr Cooke's witness statement and the
agreed facts. I can do no better than quote
them verbatim:….”
It was further said:
“
63. It is clear
from the judgment of van der Linde J that the BRP has conferred upon
him the power to suspend the obligations of
the company in business
rescue.
Section 136(2)(a)
does not confer upon him any rights in
regard to the creditor whose reciprocal rights and obligations remain
unaffected notwithstanding
the exercise of the powers by the BRP
provided in
section 136(2)
of the Act”. And:
“
64.
In the
result the notices sent by the BRP did not suspend the claimant's
contractual rights
”. And:
“
67.
This claim
does not take into account the reciprocal nature of the Service
Agreements
. It is not in dispute that CC did not render any
services to BR during the period referred to in the previous
paragraph.
68. Whilst CC may have
correctly been of the view that the BRPs did not comply with the
provisions of
section 136(2)
of the Act, it must have been apparent
to those in control of CC what the intention of the BRPs was. They
now seek to benefit from
the BRPS' error in the application of the
section. They do this knowing full well that CC did not render any
services in respect
of the amounts claimed. In the circumstances CC
is not entitled to claim such payment. Counsel for the BRPs referred
to Panama
Properties (Pty) Ltd and Another v Nel and Others NNO 2015
(5) 63 ((SCA) where it was held: "Consequently they have given
rise to confusion as to their meaning and provided ample scope for
litigious parties to exploit inconsistencies and advance technical
arguments aimed at stultifying the business rescue process or
securing advantages not contemplated by its broad purpose. This is
such a case." Whilst this dictum arose in a different context it
is equally applicable in the instant matter.
69. In the circumstances
the claim in respect of the Service Agreements falls to be
dismissed
. 70. As far as the claim in respect of the Management
Agreements is concerned CC contends that it is entitled to a
substantial
portion of each and every claim and variation order
covered by the settlement agreements between BR and Eskom. In regard
hereto,
as with the Service Agreements CC has provided no services
whatsoever to BR under the Management Agreements.
71. In the circumstances
the claim in respect of the Management Agreements falls to be
dismissed.
72. As far as costs are
concerned,
the main dispute between the parties was the
application of section of 136(2) of the Act. CC was successful in
this regard
. The BRPs were successful in their opposition to the
claims in respect of the Service Agreements and Management Agreement.
In the
result no order should be made in respect of the costs
relating to the above. 73. My award is as set out above”. (Own
emphasis)
[19]
In sum the Expert dismissed applicant's claim in respect of the
service agreements, dismissed applicant's claim in respect
of the
management agreements and ordered each party to pay its own costs.
[20]
During argument I canvassed from the parties what was the intention
of the parties in the statement of agreed facts with
the wording
“stands to be confirmed as owing…” and when and
where it should be confirmed. It was proffered that
the Expert was to
confirm the admitted amounts as part of his findings.
[21]
Section 40
of the Business Rescue Plan deals with dispute
resolution which makes provision for the appointment of a Retired
Judge as an Expert.
[22]
The section reads as follows:
”
40.
DISPUTE RESOLUTION
40.1 Subject to paragraph
40.3, save as provided for in
section 133
of the
Companies Act,
in
respect of all or any
disputes by the BRPs on Claims submitted by Creditor(s), PCF
Creditors and Employees,
which disputes include, but are not limited to, disputes on
the existence or
otherwise of Claim(s), on quantum of Claim(s), security claimed by a
Creditor, the nature of
the security, the extent and value of the security and the like
(“the dispute”)
such dispute may be resolved in accordance with the dispute
mechanism outlined below
(“the Dispute Mechanism”).
…
..
40.2.5. The Creditor/s or
Employee/s agrees that,
save for any manifest error the
determination of the
expert will be final and binding on the Creditor/s or
Employee/s, the
Company and the BRPs and will not be subject to any
subsequent
review or appeal application / procedure / process
.
40.2.6.
The
expert shall be entitled to make an award for costs in his
discretion.
40.2.7.
To the extent necessary, should the BRPs be
of the view that
certain
disputes
may be settled
or compromised,
the
BRPs shall be authorised to
settle
and compromise such a dispute
”
.
(Own emphasis)
[23]
Section 136
of the
Companies Act 71 of 2008
reads as follows:
“…
..
(2)
Subject to subsection (2A), and despite any provision of an agreement
to the contrary, during business
rescue proceedings, the practitioner
may—
(a)
entirely, partially or conditionally suspend, for the duration of the
business rescue proceedings, any
obligation of the company that—
(i)
arises under an agreement to which the
company was a party at the
commencement of the
business rescue proceedings; and
(ii)
would otherwise become due during those proceedings; or
(b) ….”
[24]
The definition of ‘agreement’ in
section 1
of
the
Companies Act ‘includes
a contract, or an arrangement or
understanding between or among two or more parties that purports to
create rights and obligations
between or among those parties.’
[25] In the instant
case the BRPs elected to exercise their power in terms of
section 136
(2) (a) of the
Companies Act to
suspend applicant’s
obligations, instead of first respondent’s obligations, under
its contracts, service providers,
etc. and accordingly gave notice.
[26]
At the hearing before the Expert Mr. Peter Cooke, on behalf of
applicant, submitted a witness statement which stood as
evidence in
chief, was confirmed under oath and the BRPs’ legal
representative elected not to cross-examine him on the contents
at
all. Mr. Siviwe Dongwana, third respondent, on behalf of the BRPs
also submitted a witness statement which stood as evidence
in chief,
was also confirmed under oath and during cross-examination made some
“stark and telling concessions”.
[27]
During Mr. Dongwana's testimony he referred to specifically
section
136
of the Act and gave an exposition why applicant would no longer
be required to render goods and services during business rescue.
This
defence was rejected by the Expert.
[28]
In cross-examination Mr. Dongwana confirmed that the first
respondent's obligations under the agreements was not suspended only
the services were suspended which prevented the applicant from doing
its work. Applicant therefore continuously tendered its services,
but
was denied access to the Medupi site, which constitutes a breach of
the agreements between the parties.
[29]
In cross-examination Mr. Dongwana admitted that creditors
should be given reasons for the rejection of their claims, but could
not
explain why applicant did not receive a response to any of its
requests. He never investigated applicant's claims. He did not know
how many agreements were in place between first respondent and
applicant. He did not know what applicant would have to do to become
entitled to payment under any of the agreements. He did not know what
services were rendered in terms of the agreements. He did
not know
how the payment structure of agreements worked. He never read the
agreements between first respondent and applicant.
[30]
He further testified that the anticipated liquidation dividend
to concurrent creditors was 5,4 cents in the rand and in business
rescue nothing (R0.00).
He confirmed the
fundamental purpose of business rescue could not be achieved, but
admitted having charged his fees for the past
five years.
[31]
He
could not explain his duties under
section 141
of the
Companies Act
and
when so asked, he responded:”remind me
”
.
He
also did not take any steps to comply with the duties in
section 141
of the
Companies Act to
end the business rescue.
[1]
[32]
Mr Dongwana’s oral evidence was in
conflict with his statement (and conclusions drawn therein) as well
as the statement of
agreed facts and was unable to proffer any
substance to substantiate same. An attempt to shift the blame to his
co-BRP was also
unsuccessful as the latter did not testify or adduced
any evidence.
[33]
In the Award, paragraph 7, the Expert noted: “This is not a man
that should be charged with the fate of distressed
companies. He is
neither fit nor proper to fulfil that function. His appointment has
in this case resulted in patent detriment
to the body of creditors
generally and, Cos Consult in particular. His appointment in other
cases likely will too”.
[34]
The Award of the Expert is reviewable, according to the applicant, on
at least five grounds:
“
1.
The first respondent did not contend that applicant was not entitled
to payment because services were
never provided;
2.
The issue of reciprocity precluding payment, as a ground independent
of the
section 136
issue was not pleaded, canvassed in evidence or
put to either party in argument;
3.
The Expert did not have regard to the undisputed evidence of why
applicant did not render services after
May 2015, it having been
precluded from doing so by first respondent;
4.
The Expert ignored the undisputed evidence that applicant repeatedly
tendered to render the relevant
services.
5.
The Expert upheld the BRPs’ defence under
section 136
of the
Companies Act without
legal or factual foundation or justification”.
[35]
The Expert incorrectly upheld the BRPs’
section 136
defence and
its consequence without any evidence or foundation despite having
correctly reasoned that there was no factual or legal
merit in the
BRPs’ defence.
[36]
It is common cause that applicant has not rendered services after May
2015 having been prevented from doing so by first
respondent. First
respondent admitted liability under the service agreements for the
period to 15 June 2018 included in the total
amount of R50 836
127.31. This underscores the fact that first respondent never relied
on reciprocity outside of the BRPs’
section 136
defence.
[37]
Had reciprocity been pleaded by the BRPs at any time, their admission
of liability would have been limited to May 2015
and not to 15 June
2018 when first respondent went into business rescue.
[38]
There was no other defence raised by the BRPs or found by the Expert.
The Expert in finding against the BRPs in respect
of the
section 136
issue, ought to have given effect to paragraph 41 and 42 of the
agreed statement of facts.
[39]
The Expert made a finding on the costs issue predicated on his
reciprocity finding. Applicant was already entitled to the agreed
pre-commencement amount. The Expert ought to have confirmed the
amount of R50 836 127.31, and based on the outcome of the
section 136
issue the amount R8 970 000.00 as well, which amounts to
substantial success.
[40]
In the
matter of
Natal Joint
Municipal Pension Fund v Endumeni Municipality
(920/2010)
[2012] ZASCA 13
;
[2012] 2 All SA 262
(SCA);
2012 (4) SA 593
(SCA) (16
March 2012)
it was said
:”
[18]
Over the last century there have been significant developments in the
law relating to the interpretation of documents, both
in this country
and in others that follow similar rules to our own. It is
unnecessary to add unduly to the burden of annotations
by trawling
through the case law on the construction of documents in order to
trace those developments. The relevant authorities
are collected and
summarised in
Bastian
Financial Services (Pty) Ltd
v
General
Hendrik Schoeman Primary School.
[2]
The
present state of the law can be expressed as follows. Interpretation
is the process of attributing meaning to the words
used in a
document, be it legislation, some other statutory instrument, or
contract, having regard to the context provided by reading
the
particular provision or provisions in the light of the document as a
whole and the circumstances attendant upon its coming
into existence.
Whatever the nature of the document, consideration must be given to
the language used in the light of the ordinary
rules of grammar and
syntax; the context in which the provision appears; the apparent
purpose to which it is directed and the material
known to those
responsible for its production. Where more than one meaning is
possible each possibility must be weighed in the
light of all these
factors. The process is objective not subjective. A sensible
meaning is to be preferred to one that leads
to insensible or
unbusinesslike results or undermines the apparent purpose of the
document. Judges must be alert to, and guard
against, the temptation
to substitute what they regard as reasonable, sensible or
businesslike for the words actually used. To
do so in regard to a
statute or statutory instrument is to cross the divide between
interpretation and legislation. In a contractual
context it is to
make a contract for the parties other than the one they in fact made.
The ‘inevitable point of departure
is the language of the
provision itself’, read in context and having regard to
the purpose of the provision and the
background to the preparation
and production of the document.
[19]
All this is consistent with the ‘emerging trend in statutory
construction’.
[3]
It
clearly adopts as the proper approach to the interpretation of
documents the second of the two possible approaches mentioned
by
Schreiner JA in
Jaga
v
Dönges
NO and another
,
[4]
namely
that from the outset one considers the context and the language
together, with neither predominating over the other.
This is the
approach that courts in South Africa should now follow, without the
need to cite authorities from an earlier era that
are not necessarily
consistent and frequently reflect an approach to interpretation that
is no longer appropriate. The path that
Schreiner JA pointed to is
now received wisdom elsewhere. Thus Sir Anthony Mason CJ said:
‘
Problems
of legal interpretation are not solved satisfactorily by ritual
incantations which emphasise the clarity of meaning which
words have
when viewed in isolation, divorced from their context. The modern
approach to interpretation insists that context be
considered in the
first instance, especially in the case of general words, and not
merely at some later stage when ambiguity might
be thought to arise.’
“
[41] In my
consideration of the statement of facts, I cannot come to the same
conclusion as the Expert in not confirming the
pre-commencement
amount, the confirming of the post-commencement amount in the event
of his finding against
s 136
and costs. The wording of the first
notice of the BRPs is clear regarding suspension of applicant and
should there have been ambiguity,
which is not, the interpretation is
to go against the BRPs. If, for a moment, I have to consider the
intention of Mr. Dongwana
it also does not come to his aide
considering the agreed facts, his testimony and the Expert’s
remarks about him.
[42] In the matter
of
Transnet National Ports Authority v Reit
Investments (Pty) Limited and Another
(1159/2019)
[2020] ZASCA 129
(13 October 2020)
it was said:
“
[33]
This distinction serves an important purpose in review proceedings
because, as Ponnan JA put it in
Lufuno
Mphaphuli & Associates (Pty) Ltd
v
Andrews
and Another
[2007]
ZASCA 143
;
2008
(2) SA 448
(SCA)
para
22:
‘
.
. .
Whenever two parties agree to refer
a matter to a third for decision, and further agree that his decision
is to be final and binding
on them, then, so long as he arrives at
his decision honestly and in good faith, the two parties are bound by
it
. . . .’
[34]
Accordingly, the power of the courts to interfere with an expert’s
decision in review proceedings is severely circumscribed.
The
juridical ambit of this power was described by this Court
in
Wright
v
Wright
[2014]
ZASCA 126
;
2015
(1) SA 262
(SCA)
para
10 as follows:
‘
The
position of a referee under
s
19b
is,
as the high court correctly found, similar to that of an expert
valuator who only makes factual findings but dissimilar to that
of an
arbitrator who fulfils a quasi-judicial function within the
parameters of the
Arbitration
Act 42
of 1965
. In this regard, the dictum of Boruchowitz J
in
Perdikis
v
Jamieson
is
apposite:
“
It
was held in
Bekker
v
RSA
Factors
1983
(4) SA 568
(T)
that
a valuation can be rectified on equitable grounds where the valuer
does not exercise the judgment of a reasonable man, that
is, his
judgment is exercised unreasonably, irregularly or wrongly so as to
lead to a patently inequitable result.”
This
is also the position in respect of the referee’s report –
it can only be impugned on these narrow grounds.’
[36] …
The crux
of the dispute, as I see it, was essentially whether Mr Seota had
acted in accordance with his mandate from the parties
and, if so,
whether his determination was otherwise manifestly unjust
.
[37…In
Telcordia
Technologies Inc v Telkom SA Ltd
[2006]
ZASCA 112
;
2007
(3) SA 266
(SCA)
para
51, Harms JA made the following pointed remarks:
‘
Last,
by agreeing to arbitration the parties limit interference by courts
to the ground of procedural irregularities set out in
s 33(1)
of the
Act. By necessary implication they waive the right to rely on any
further ground of review, “common law” or
otherwise….’
[38]
Thus, it was not open to him to disregard the parties’ explicit
instructions and, on a frolic of his own, …. in
Hos+Med
Medical Aid Scheme
v
Thebe
Ya Bophelo Healthcare Marketing & Consulting (Pty) Ltd and
Others
[2007]
ZASCA 163
;
2008
(2) SA 608
(SCA)
para
30:
‘
In
my view it is clear that the only source of an arbitrator’s
power is the arbitration agreement between the parties and
an
arbitrator cannot stray beyond their submission where the parties
have expressly defined and limited the issues, as the parties
have
done in this case to the matters pleaded
.
. . .’
[40] On the authorities
discussed above, it is now well established that an expert’s
bona fide determination or award will
not be lightly interfered with
by the courts.”
[43] In the instant
case the parties agreed on the statement of facts which limited the
issues embodied in the mandate referred
to the Expert and his Award
will be final and binding except in the case of a manifest error. It
is apparent that the Expert did
not act in accordance with his
mandate by not making a bona fide determination and exercised his
powers manifestly unjust by not
confirming any amount. Reciprocity
was not in issue or raised by either party. The
section 136
issue was
found in favour of applicant and if so, the parties agreed what the
result would be, namely confirmation of the post-commencement
amount
as well.
[44]
In the case of
Rebah Construction
CC v Renkie Building Construction CC
(
42794/2007)
[2008] ZAGPHC 34
;
2008
(3) SA 475
(T) (11 February 2008)
at paragraph 31 it was said:”In
McKenzie
NO
v
Basha
1951
(3) 783 (NPD) 786A, BROOME JP said:’The Court may always
interfere with an award which extends to matters not submitted.
If an
arbitrator deals with a question which is not within the terms of the
submissions, the decision of the arbitrator is a nullity.
The
submissions made by the parties in this case, makes no provision for
default awards and by granting default award without giving
any
notice to the respondent, the arbitrator acted outside the terms of
reference’.
On
this ground alone, the court is entitled to set aside the award as
the arbitrator has exceeded his powers as mentioned in
section
33(1)(b)
of
the
Arbitration
Act
supra
.”
[45]
In the matter of
Gutsche Family
Investments (Pty) Ltd and Others v Mettle Equity Group
(Pty) Ltd and Others
(115/2011)
[2012] ZASCA 4
(8 March 2012)
it was said in paragraph 18:”…
(c)
Arbitrators, including arbitral appeal tribunals, are bound by the
pleadings. The only difference between the two in this regard,
as I
see it, is that on appeal the pleadings also include notices of
appeal and cross-appeal. Unlike a court, arbitrators therefore
have
no inherent power to determine issues or to grant relief outside the
pleadings. Arbitrators who stray beyond the pleadings
therefore
exceed their powers as contemplated by
s
33(1)(
b
).”
[46]
In the matter of
Kingsgate
Clothing (Pty) Ltd and Others v Edcon Limited (In
Business Rescue) and Others
(57045/2020)
[2021] ZAGPPHC 769 (15 November 2021)
it was said:”
[7] The
jurisdictional fact for any further appeal or review procedure is the
existence of a 'manifest error' in the determination
made by the
expert. Due to the wording of this clause, I am of the view that
it
is irrelevant whether the adjudicator of any dispute provided for in
clause 39 is referred to as an 'expert' or an 'arbitrator'
or even a
'mediator.' Absent a manifest error, the determination of the dispute
in issue is final.
[8] In
Media24
(Pty) Ltd
v
Estate
Late Du Plessis
[5]
the
Supreme Court of Appeal explained that a manifest error is an error
that is:
'plain and indisputable
and that amounts to a complete disregard of the controlling law or
the credible evidence on record.'
The
Supreme Court of Appeal referred with approval
to
Winfield
v
Dimension
Data Holdings Limited & Others,
[6]
where
the court in turn referred not only to the meaning ascribed to the
term in Black's Law Dictionary, but also to a decision
of the
Chancery Division of Northern Ireland –
Dixon
Group plc v John Andrew Murray-Oboynski
[7]
where
it was held that a manifest error is an error that 'may easily be
seen by the eye or perceived by the mind'.
[9] Van
der Linde AJ, as he then was, held in
James v Micor
Holdings Ltd
[8]
that-
'A narrower
interpretation of 'manifest error', is that it refers to an error
which is manifest, or patent, on the face of determination;
one which
results in the determination not being that which the appointee
himself/herself had intended. On this interpretation,
'error' would
relate to the standards set by the appointee himself/herself and
'manifest' would relate to the obviousness of this
deviation.'
He rejected the argument
that that deviation from the required standard of conduct would
constitute a manifest error as this would
mean that:
'the determination may be
revisited on the merits, in order to assess whether it contains a
deviation …, and if so, whether
the deviation in question is
manifest or not. In my view, such an interpretation of 'manifest
error' is subversive of the notion
of the final determination of
complex accountant disputes by a third party'.
[10] A cumulative
reading of the case law referred to above, leads to the conclusion
that a 'manifest error' is more than merely
a wrong conclusion. It
refers to oversights and blunders so obvious and obviously capable of
affecting the award or determination
'as to admit no difference of
opinion'. This narrow interpretation of the term limits a
court's jurisdiction to interfere
with awards made subject to what
can be referred to as the manifest error exception. This limitation
is justified, however, in
the context of cases like the present,
where the legislature provided for the adoption of a BRP in
prescribed circumstances with
the aim of speedily resolving issues.
It sets a high bar for establishing that such an error has occurred.
If courts were to have
a wider scope in which to interfere with an
expert's determination the courts would simply become an alternative
forum for the
party dissatisfied with the expert's conclusions, and
this would refute the purpose of business rescue proceedings. Having
said
this, the question as to whether a plain and obvious error has
occurred will be a question of fact that needs to be assessed in
the
face of the 'controlling law or the credible evidence on record.'
Audi
et alteram
was not violated. The
applicants did not provide an iota of evidence indicating that the
fourth respondent failed to follow a procedurally
fair process or
that they were not afforded a fair hearing.
[15] Even
if it is accepted to the benefit of the applicants, without finding
so, that the applicants' proposed interpretation
constitutes an
arguable competing interpretation, the applicants failed to show that
the fourth respondents' interpretation was
obviously wrong. The
applicants did not make out a case that the fourth respondent's
report is the product of an indisputable
error of judgment in
complete disregard of the facts of the case, the applicable law and
credible evidence”.
(Own emphasis)
[47] In the case
before me the applicant did make out a case regarding the Expert’s
error of judgment by disregarding
the statement of agreed facts and
credible evidence.
I cannot come to a
different conclusion that a manifest error did occur or the existence
of an exclusion to a manifest error that
occurred.
[48] The statement
did refer to an Arbitrator whereas an Expert heard the dispute in
terms of
section 40
of the business rescue plan. I accept it was a
mistake common to the parties and was also not in issue.
[49]
In the matter before me the
audi
alteram partem
rule was violated with regards to the reciprocity issue. Reciprocity
was never pleaded by first respondent or placed in dispute.
The
dispute was limited to the
section 136
issue. No portion of the
reciprocity finding was put to applicant’s witness by the
respondents or to counsel in argument
by the Expert. The
audi
alteram partem
failure led to a reviewable irregularity.
[9]
[50]
In his Award the Expert relied on the
BP
case for his finding on reciprocity. I have considered the matter of
BP Southern Africa (Pty) Ltd v
Intertrans Oil SA (Pty) Ltd and Others
(34716/2016) [2016] ZAGPJHC 310;
2017
(4) SA 592
(GJ) (25 November 2016)
where it was said:”
[37]
Interpretation starts with a textual treatment of the words in their
context. The language conferring the power of suspension
is
pretty clear, at least on the face of it; “
any”
is
notoriously a word of wide if not unlimited import, and so it would,
at least
prima facie
and
unless any absurdity is thrown up, include obligations that are
contractually tied with a reciprocal obligation of the
creditor.”
[51] In the
proceedings before the Expert, applicant took issue with the wording
of the Notices alleging an improper exercising
of the BRPs power
under
section 136(2)
to the extent that the BRPs sought to suspend
the contractual rights and/or obligations of service providers rather
than the contractual
obligations of the first respondent. The Expert
found that the BRPs could not under
section 136(2)
suspend any
obligation of the applicant that contracted with the first respondent
and therefore did not suspend the applicant’s
contractual
rights as a claimant.
[52] Applicant
continued to tender its suspended services. Whilst it may have been
the intention of the BRPs to suspend first
respondent’s
obligations, it was never communicated to applicant and what was
agreed in the statement of agreed facts expressed
the contrary. This
has also to be considered with what was said about the BRP that
testified.
[53] Predicated on
this, applicant was entitled to its post-commencement claims,
notwithstanding the non-provision of services
during business rescue
proceedings (and as agreed prior thereto). In the statement of agreed
facts this was also not in dispute.
I have considered paragraph 9 of
the 5 July 2018 notice and cannot come to a different conclusion.
[54]
It cannot be excluded that the BRPs’ actions in the exercise of
their powers may amount to gross negligence in
terms of section
140(3)(c)(ii) of the
Companies Act.
[10
]
[55] In the
BP
case the BRP exercised the power under
section 136(2)
of the
Companies Act suspending
the obligations of the company in business
rescue and the impact on the reciprocal obligations of the other
party. In the case
before me the BRPs suspended the obligations of
the claimant only and reciprocity was not pleaded, canvassed in
evidence or put
to either party. The BRPs also admitted a portion of
the pre-commencement claim, knowing that services were not rendered
in lieu
thereof, which was not the case in the
BP
matter.
[56] One cannot
assume what the BRPs actually intended since they might well have
continued with their payment obligations
after having received in
excess of
R 2 083 078 574,62
in 2021 in lieu of completed services. This has to be considered
against the backdrop of what
was agreed between the parties. Whilst
it may be true that applicant should not be entitled to payment for
services not rendered
post-commencement, it was expressly agreed what
the outcome will be in the event of the BRPs’
section 136(2)
defence not successful.
[57]
Notwithstanding the fact that it may not be the norm or standard to
agree as it happened in the case before me, the BRPs
acquiesced by
persisting with the notices and agreeing to the statement of facts.
[58]
In the matter of
Tongaat Hulett Limited
and Others v South African Sugar Association and Others
(945/2024)
[2025] ZASCA 190
;
2026 (3) SA 108
(SCA) (15 December 2025)
it was
said:”
[34]
These provisions should be construed in accordance with the
recognised principles of interpretation. The proper approach
to
legislative interpretation in our law requires courts to ascertain
and give effect to the intention of the legislature, as expressed
in
the wording of the statute, while also considering the context,
purpose, and underlying values of the Constitution. In this
regard,
the purposive approach is favoured, ensuring that statutory
provisions are read holistically and in a manner that promotes
the
spirit, purport, and objects of the Bill of Rights.
[11]
[35]
The
Constitutional Court, in
Investigating
Directorate: Serious Economic Offences and Others
v
Hyundai
Motor Distributors (Pty) Ltd and Others
(
Hyundai
Motor Distributors
),
[12]
affirmed
that interpretation must be consistent with constitutional values and
that ambiguity must be resolved in a way that
best promotes those
values.
[36] It is a fundamental
tenet of our law of statutory interpretation that legislation must,
wherever possible, be read in a manner
that is consistent with the
Constitution. This principle, often referred to as the doctrine of
constitutional compliance, has become
a cornerstone of modern
interpretive methodology in South Africa. It requires
courts to favour an interpretation of statutory
provisions that
upholds, rather than undermines, constitutional rights and values.
[37] Section 39(2) of the
Constitution specifically directs that when interpreting any
legislation, every court, tribunal, or forum
must promote the spirit,
purport, and objects of the Bill of Rights. This interpretive
injunction means that if a statutory provision
is reasonably capable
of more than one meaning, the meaning that is consistent with the
Constitution should be preferred. Therefore,
courts are not permitted
to adopt an interpretation that would render the provision
unconstitutional if a constitutionally compliant
construction is
reasonably possible.
[38] This approach was
articulated by the Constitutional Court in
Hyundai Motor
Distributors
, as follows:
‘
Accordingly,
judicial officers must prefer interpretations of legislation that
fall within constitutional bounds over those that
do not, provided
that such interpretative approach can be reasonably ascribed to the
section.’
[39] The Constitutional
Court further emphasised that ambiguity is not a prerequisite for the
application of this principle –
wherever a statute is
reasonably capable of a meaning that avoids constitutional
invalidity, that meaning ought to be adopted.
This ensures that
legislative intent is realised as far as possible without encroaching
upon constitutional rights.
[56]
In
summary, I find that the definition of an agreement under
the
Companies
Act contemplates
a
covenant concluded by parties through mutual assent, creating rights
and obligations
inter
partes
.
[13]
(Own
emphasis)
[59]
In the instant case the statement of facts agreed has to be
considered with the history between the parties and the BRPs
intentions in specifically this case. What was agreed in writing was
consented to as set out in the
Companies Act.
[14
]
[60]
In the matter of
Ragavan and
Others v Optimum Coal Terminal (Pty) Ltd and Others
(136/2022)
[2023] ZASCA 34
;
2023 (4) SA 78
(SCA) (31 March 2023)
at para 23 it was said:”
The
primary purpose of business rescue is to enable the practitioner to
prepare and implement a plan ‘to rescue the company
by
restructuring its affairs, business, property, debt and other
liabilities, and equity in a manner that maximises the likelihood
of
the company continuing in existence on a solvent basis or, if it is
not possible for the company to so continue in existence,
results in
a better return for the company’s creditors, or shareholders
than would result from the immediate liquidation
of the company.’
[15]
[28] It follows that
the purported differentiation by the appellants in respect of pre-and
post-adoption of the plan has no
foundation in the provisions of
chapter 6. This case is concerned with the creditors’ right to
vote as contemplated in
s 151
read with
s 152.
The shareholders do
not feature.
Section 152(3)
(c)
deals with shareholders’
rights. In terms of that section, if the proposed plan alters the
rights of any class or classes
of the holders of the company’s
securities, the holders of such rights will be present at the meeting
where the plan is being
considered. Thus, in that special case, the
shareholders are consulted.”
[61] In the case
before me it cannot be said that the BRPs’ plan was to rescue
the first respondent and, failing to,
thereafter immediately
liquidate the first respondent. The first respondent went into
business rescue eight years ago with a dividend
of 5,4 cents to the
rand that diminished to 0,00. First respondent also attempted to
terminate the agreements with applicant eleven
years ago.
CONCLUSION
[62]
In this case the Expert misconstrued the issue he was called upon to
decide and acted outside his mandate. The dismissing
of the agreed
amounts in the Award, with the reciprocity issue, constitutes a gross
irregularity and a manifest error. The review,
in my view, is
successful and it is in the interests of justice that the findings
and conclusions made in paragraph 67 to 73 of
the Expert’s
Award, handed down on 29 February 2024 is reviewed and set aside.
COSTS
[63]
Applicant’s application was successful with costs to follow the
result.
The
general principle regarding the award of costs is
well-settled: it is entirely a matter for the discretion of the
court
which is to be exercised judicially upon a consideration of the facts
of each case and in essence it is a matter of fairness
to both
sides.
[16]
[64]
In
De
Naamloze Vennootschap Alintex v Von Gerlach
1958
(1) SA 13
(T)
on
page 16 it was said: “T
he
question of the engagement of two counsel has of course
been discussed in a number of cases and in
South
African Railways and Harbours v Mills
,
1924
CPD 110
,
numerous authorities were reviewed and from the case there are to be
extracted the following requirements, namely, the length
of the
hearing or argument, the importance of questions of principle or of
law involved, and the number of legal authorities quoted.”
In
my view the issues involved, length of the argument, questions of law
and the complexity of the matter warranted the employment
of two
counsel and I therefore allowed the cost of two counsel.
[65]
In the result the following order is made:
ORDER:
1. The findings and
conclusions made in paragraph 67 to 73 of the Expert’s award,
handed down on 29 February 2024 (“the
Award”) are
reviewed and set aside.
2. Paragraphs 67 to
73 of the Award are replaced with the following:
2.1 The second and third
respondents are to recognize, in accordance with the Plan, the
claimant's claims against the first respondent
of:
2.1.1
R50 836 127.31, together with interest thereon; and
2.1.2
R8 970 000.00, together with interest thereon.
2.2 It is declared that
the applicant has an in-principle entitlement under the management
agreement, the quantum of which is held
over for determination at a
later stage, and
2.3 The applicant’s
costs in the dispute under
section 40
of the business rescue plan are
to be paid by the first, second and third respondents jointly and
severally, the one paying, the
other to be absolved, on the attorney
and client scale.
3. The applicant's
costs in its review application are to be paid by the first, second
and third respondents jointly and severally,
the one paying, the
others to be absolved, on the attorney and client scale to include
the costs of two counsel where so employed.
ALLEN
AJ
ACTING
JUDGE OF THE HIGH COURT,
GAUTENG
DIVISION JOHANNESBURG
This judgment was
prepared by Acting Judge Allen. It is handed down electronically by
circulation to the parties or their legal
representatives by email,
by uploading to the electronic file of this matter on Caselines, and
by publication of the judgment to
the South African Legal Information
Institute. The date for hand-down is deemed to be 21 May 2026.
HEARD
ON:
12 May 2026
DECIDED
ON:
21 May 2026
For the Applicant:
Adv B Berridge SC
With
him:
Adv M Cooke
Instructed
by:
Ryan D Lewis Attorney
For
the Respondents: Adv A Bham SC
With
him:
Adv C Kruger
Instructed
by:
Mkhabela Huntley Attorneys
[1]
Section
141
of the
Companies Act, Act
71 of 2008, reads:”
141.
Investigation of affairs of company
(1)…
(2)
If, at any time
during business rescue proceedings
, the practitioner concludes
that-
(a) there is no
reasonable prospect for the company to be rescued, the
practitioner
must
-
(i)
so inform the court, the company, and all affected persons in
the prescribed manner; and
(ii)
apply to the court for an order discontinuing the business rescue
proceedings and placing the company into liquidation;
(b)…..”
(Own emphasis)
[2]
Bastian
Financial Services (Pty) Ltd v General Hendrik Schoeman
Primary School
2008
(5) SA 1
(SCA)
paras 16 - 19. That there is little or no difference between
contracts, statutes and other documents emerges from
KPMG
Chartered Accountants (SA) v Securefin Ltd &
another
2009
(4) SA 399
(SCA)
para
39.
[3]
Bato
Star Fishing (Pty) Ltd v Minister of Environmental Affairs
& others
[2004]
ZACC 15
;
2004
(4) SA 490
(CC)
para
90.
[4]
Jaga v Dönges
NO & another, Bhana v Dönges NO &
another
1950
(4) SA 653
(A)
at
662G-663A.
[5]
(169/2017)
[2017]
ZASCA 168
(1
December 2017)
at para [13].
[6]
2004
JDR 0307 (T)
at para [25].
[7]
86
BLR
32.
[8]
1999
CLR 237
(W)
at
[24] and [25].
[9]
Telcordia Technologies
Inc v Telkom SA Ltd
(26/05)
[2006] ZASCA 112
; [2006] 139 SCA (RSA)
[2006] ZASCA 112
; ;
2007 (3) SA 266
(SCA);
[2007] 2 All SA 243
(SCA);
2007 (5) BCLR 503
(SCA) (22 November
2006)
at paragraph 69 it was said:”
[69]
Errors of law can, no doubt, lead to gross irregularities in the
conduct of the proceedings. Telcordia posed the
example
where an arbitrator, because of a misunderstanding of the audi
principle, refuses to hear the one party. Although in
such a case
the error of law gives rise to the irregularity, the reviewable
irregularity would be the refusal to hear that party,
and not the
error of law. Likewise, an error of law may lead an arbitrator to
exceed his powers or to misconceive the nature
of the inquiry and
his duties in connection therewith.”
[10]
“
140.General
powers and duties of practitioners
(3) During a company’s
business rescue proceedings, the practitioner:
(a) is an officer of the
court, and must report to the court in accordance with any
applicable rules of, or orders made by, the
court;
(b) has the
responsibilities, duties and liabilities of a director of
the company, as set out in
sections 75
to
77
; and
(c) other than as
contemplated in paragraph (b)
(i) is not liable for
any act or omission in good faith in the course of the
exercise of the powers and performance
of the functions of
practitioner; but
(ii)
may be held liable in accordance with
any relevant law for the consequences of any act or
omission amounting to gross
negligence in the exercise of the powers
and performance of the functions of practitioner
.”
[11]
Cool
Ideas 1186 CC v Hubbard and Another
[2014]
ZACC 16
;
2014
(4) SA 474
(CC);
2014
(8) BCLR 869
(CC)
para 28
.
[12]
Investigating
Directorate: Serious Economic Offences and Others
v
Hyundai
Motor Distributors (Pty) Ltd and Others; In re: Hyundai Motor
Distributors (Pty) Ltd and Others
v
Smit
NO and Others
[2000]
ZACC 12
;
2000
(10) BCLR 1079
(CC)
[2000] ZACC 12
; ;
2001
(1) SA 545
(CC)
[2000] ZACC 12
; ;
2000
(2) SACR 349
(CC)
(
Hyundai
Motor Distributors
).
[13]
See
also the case of
Tongaat
Hulett Limited (In Business Rescue) and Others v South
African Sugar Association and Others
(D4472/2023)
[2023] ZAKZDHC 93;
[2024] 1 All SA 509
(KZD) (4 December 2023)
“
[73]
I
am consequently of the opinion that, having regard to the ordinary
meaning of the words used and the ordinary rules of grammar
and
syntax, it is plain that what the Legislature regards as an
“agreement
”
for
the purposes of the
Companies
Act, is
a
set of rights and obligations that are founded or created by, and
derive their legal power from, a “contract”,
“arrangement” or “understanding” “between
or among” the persons who are party to it. Those
obligations
are private law obligations arising from consensus between
contracting parties (i.e. obligations
ex
contractu
).
[74]
The
text of
s
136(2)(a)(i)
itself
suggests that the meaning of “agreement” refers to
obligations arising
ex
contractu.
The
“agreement” must be an agreement “to which the
company was a party”. A person or an entity is “a
party”
to a contract or agreement and not to national or subordinate
legislation.
[75]
The
meaning of the word “agreement” as used in
s
136(2)(a)(i)
as
referring to a contract and obligations that arise
ex
contractu
is
reinforced when regard is had to
s
136
as
a whole. Firstly, the heading signifies that what the section deals
with is the “Effect of business rescue on employees
and
contracts
”
.
Secondly,
ss
136(1)
and
2><
SPAN LANG="en-GB">136
(2A)
refers to and deals with contracts which comply with the
qualification that come into being by consensus and that create
rights and obligations, namely employment contracts and agreements
to which
ss
35A
or
2><
SPAN LANG="en-ZA">35B
of
the
Insolvency
Act, 1936
apply
.
Thirdly, in
s
136(2)(b)
provision
is made for an application to court to “cancel … any
obligation of the company contemplated in paragraph
(a)”.
While a court may have the power (by virtue of
s
136(2)(b))
to
“cancel
”
an
obligation that arises in contract, a court has no power to “cancel”
legislation. Parties themselves have the power
to bring a contract
into being by consensus and thereby to create legal rights and
obligations. This distinguishes an obligation
arising
ex
contractu
from
one arising
ex
lege
.
They also have the power to cancel the contract, always by mutual
agreement, sometimes unilaterally, and sometimes after following
certain formalities. They never have the power to cancel legislation
or law that binds them for reasons other than because they
created
it.”
[14]
”General moratorium on legal proceedings against company
133.
(1) During business rescue proceedings, no legal proceeding,
including enforcement action, against the company, or in relation
to
any property belonging to the company, or lawfully in its
possession, may be commenced or proceeded with in any forum,
except
—
(a)
with the written consent of the practitioner
;…..”(Own
emphasis)
[15]
Section 128(1)
(b)
(iii)
of the
Companies Act.
[16
]
Graham
v Odendaal
1972
(2) SA 611
(A)
on
page 616 and
Gelb
v Hawkins
1960
(3) SA 687
(A)
on
page 694: “
In
seeking a basic principle to apply, I do not think it is
necessary or desirable to say more than that the Court has a
discretion, to be exercised judicially upon a consideration of the
facts of each case, and that in essence it is a matter of
fairness
to both sides. The various decisions in the reports in regard to
costs seem to me to be illustrations of this basic
principle.”