TODAY'S ALERTS

Facts: Dimension Data (applicant) sought to review and set aside several decisions made by the City of Cape Town and the City Manager. These decisions included the City Manager’s ruling that the applicant had misrepresented its compliance with tender specifications, the subsequent sanction restricting the applicant from doing business with the City for five years, and the termination of ten contracts between the applicant and the City. The applicant also challenged clauses of the City’s Supply Chain Management (SCM) Policy, arguing that they were unlawful. The dispute arose from the applicant’s bid for Tender 328S, which involved the supply and maintenance of telecommunications network security infrastructure. The City alleged that the applicant had misrepresented its pricing by applying incorrect discounts to renewal items, which were not applicable to the City’s existing hardware.

Issue: The main issues were whether the City Manager’s ruling that the applicant had misrepresented its compliance with tender specifications was lawful and reasonable; whether the sanction imposed on the applicant, including its restriction from doing business with the City, was rational and justified; whether the termination of the ten contracts and the refusal to award Tender 415S to the applicant were lawful; whether certain clauses of the City’s SCM Policy were invalid.

Discussion: The court examined whether the applicant had misrepresented its pricing in its bid for Tender 328S. The applicant argued that it had interpreted the tender document to apply only to new items, not renewals, and that any misrepresentation was immaterial. The City, however, contended that the applicant knowingly submitted an altered OEM price list, applying incorrect discounts to renewal items, which misled the City during the evaluation process. The court found that the tender document clearly required the maintenance of the City’s existing infrastructure, including renewals, and that the applicant’s misrepresentation was material. The court also found that the City Manager’s ruling was reasonable and lawful.

Findings: However, the court found that the City Manager’s sanction decision was irrational due to an error in the evaluation of IT Naledi’s bid. The City Manager incorrectly stated that only 8 out of 28 items in the evaluation basket were renewal items, when in fact all 28 were renewal items. This error tainted the sanction decision, leading the court to set it aside. The City Manager’s ruling that the applicant had misrepresented its compliance with tender specifications was lawful and reasonable. The sanction decision was irrational due to a material error in the evaluation process and was set aside. The termination of the ten contracts and the refusal to award Tender 415S were based on the sanction decision and were therefore also set aside. The court did not rule on the validity of the challenged clauses of the SCM Policy, as the sanction decision had already been set aside.

Order: The interim relief in respect of Tender 372S was discharged. The review of the City Manager’s ruling of 22 February 2024 was dismissed. The following decisions were declared unlawful and set aside: The City Manager’s sanction decision of 26 April 2024; the decision not to conclude a contract with the applicant for Tender 415S/2022/23; the termination of ten contracts between the applicant and the City.

Facts: The applicant seeks to enforce two arbitration awards issued by the International Court of Arbitration of the International Chamber of Commerce (ICC) on 10 February 2022 and 4 September 2023, under section 16 of the International Arbitration Act 15 of 2017. The awards relate to a dispute over unpaid invoices for 22 orders of sack kraft paper, totalling €5,972,709.51, between the respondent and Forpac International AB, a Swedish entity. Forpac ceded its rights to Swedbank, which subsequently ceded them to the applicant, a Swedish government agency. The respondent opposes the enforcement, arguing that the ICC lacked jurisdiction due to the absence of a valid arbitration agreement and disputes the cession of rights to the applicant.

Issue: The central issue is whether the arbitration awards should be made an order of the court under the International Arbitration Act, despite the respondent’s challenges to the ICC’s jurisdiction and the existence of an arbitration agreement.

Discussion: The respondent contends that no arbitration agreement existed, as the clause incorporating the General Trade Rules for Paper and Paper Board (which includes an arbitration clause) was not agreed upon. The applicant argues that the respondent’s conduct, through repeated acceptance of orders referencing the General Trade Rules, demonstrates quasi-mutual assent to the arbitration agreement. The court emphasizes that it does not function as an appellate body over the ICC’s findings but must determine whether the applicant has met the requirements under section 17 of the Act and whether the respondent has raised a valid defence under section 18.

Findings: The court finds that the applicant has complied with section 17 by providing authenticated copies of the arbitration awards and the arbitration agreement. The respondent’s arguments, which largely challenge the ICC’s jurisdiction and the existence of the arbitration agreement, do not fall within the permissible defences under section 18. The respondent failed to challenge the ICC’s jurisdiction in the French courts, as allowed under Article 16(3) of the Act, and has not provided sufficient evidence to discharge its onus under section 18(1)(b). The court concludes that the arbitration awards must be enforced.

Order: The court grants the application, making the ICC’s arbitration awards an order of the court. The respondent is ordered to pay the applicant €5,972,709.51 plus interest, reimbursement for arbitration costs, and legal expenses. The respondent is also ordered to pay the costs of the application on Scale C.

Facts: The application was brought on urgent basis, with First Class Fabrication (FCF), the applicant, seeking an order to be restored possession or access to a construction site. The Roads Agency Limpopo (RAL), the first respondent, opposes the application. To be granted the remedy, the applicant must satisfy two of important requirements. The first is that a person who seeks repossession must prove peaceful and undisturbed possession of the property. And the second is that the person must show unlawful dispossession (or deprivation) by the spoliator. Both must be established. However, even if the first question whether the remedy should be granted is answered affirmatively, there are instances where the remedy may still be refused.

Issue: Mandament van spolie is a legal remedy, the purpose of which is to protect possession of property. Its purpose is to prevent unlawful dispossession of property. The court must decide, according to the established legal principle for mandament van spolie, whether FCF should be granted the remedy or not.

Discussion: The court considered the written agreement between the parties. They agree to have concluded a valid and binding service level agreement. This followed the formal appointment, in writing, of FCF as RAL’s service provider or contractor. The service agreement states that no amendments shall carry contractual force and effect if they are not reduced to writing and signed by both parties. Upholding a contract with the fullness of its terms would mean, in the context of the case, that an extension of the agreement is done in the manner that is contractually regulated. RAL through its principal agent, employed to oversee the programme of the works, refused to grant an extension of time to FCF when it made the request. FCF’s case is that its service agreement with RAL was extended, and that agreement was still valid on the fateful day.

Findings: The court found that the fact that FCF disputed the termination of the agreement was of no moment. The applicant acknowledged that it did request to be granted an extension and that the request was refused. The agreement terminated by effluxion of time. It held onto the site when it was not performing any work, not due to anyone’s fault, but its inability to perform the works for which it was appointed as a contractor. FCF was not physically in peaceful and undisturbed possession of the site and was not dispossessed by RAL. The indications were that FCF met serious financial difficulties which hampered its abilities to meet its obligations in terms of the agreement. When it overcame those difficulties the term of the agreement had neared the end. Its request for an extension was not approved. The absence of an extension can only mean that the agreement terminated in accordance with its terms.

Order: The application was dismissed with costs.

Facts: The case involves a dispute between the Kromrivier Trust (applicant) and the Hartwig Family Trust (first respondent), along with related entities and individuals, concerning the development of the Kromrivier farm into an eco-tourism destination. The applicant, represented by Nieuwoudt (Pip), and the first respondent, represented by Ernst, entered into an agreement in 2008 to develop the property. The project was to be managed through two companies: Gemini Moon, which owns the property, and Cederberg Park, the operating company. Over time, the relationship between the parties deteriorated, leading to Pip's removal as a director of both companies in 2022. The applicant alleges oppressive and prejudicial conduct under section 163 of the Companies Act 71 of 2008, seeking relief including access to financial statements, the appointment of an independent director, and Pip's reinstatement as a director.

Issue: The key issues are whether the applicant is entitled to relief under section 163 of the Companies Act due to alleged oppressive conduct by the respondents; whether the companies must provide the applicant with copies of their financial statements under section 31(1)(b) of the Companies Act; and whether Pip was validly removed as a director of Gemini Moon and Cederberg Park.

Discussion: The court examined the factual disputes between the parties, including the nature of their business relationship, the delays and costs of the project, and the circumstances surrounding Pip's removal as a director. The applicant argued that Ernst and the Hartwig Family Trust engaged in oppressive conduct, excluding Pip from decision-making and failing to provide financial information. Ernst countered that Pip was fully informed and involved in the project, and that Pip's removal was justified due to his conduct, including the unauthorized killing of protected baboons. The court applied the Plascon-Evans rule, which requires that disputes of fact in motion proceedings be resolved in favour of the respondent unless the respondent's version is far-fetched or untenable.

Findings: The court found that the applicant failed to prove oppressive conduct under section 163. The factual disputes, particularly regarding Pip's involvement in decision-making and the validity of the share sale transactions, could not be resolved in favour of the applicant. The court dismissed the relief sought, including the appointment of an independent director and the rectification of share registers. The court granted the applicant's request for financial statements, but limited it to drafts already in existence, as the Companies Act does not obligate companies to create financial statements if they do not yet exist. Pip's removal as a director was invalid because the shareholders' meetings were unlawfully convened by Ernst without Pip's consent.

Order: The companies must provide the applicant with copies of their annual financial statements (or drafts, if not finalized) for the period 2017 to the end of their last financial year within 60 days. The remainder of the applicant's relief, including the appointment of an independent director and rectification of share registers, is dismissed. The first respondent must convene shareholders' meetings for both companies within 60 days to address Pip's removal as a director. The meetings must allow legal representation and be recorded by an independent third party.

Facts: This case involves a dispute between Technologies Acceptances Receivable (TAR) and Fintech Underwriting (FUN) (plaintiffs) and Toerien, Sage, and Oxbow (defendants). The dispute arises from a Master Rental Agreement (MRA), under which Oxbow leased two printers to Toerien. The MRA was intended to replace an earlier agreement with another supplier, CBA, which Toerien wished to cancel. Oxbow agreed to incorporate the early cancellation fee from the CBA agreement into the MRA's monthly payments. The MRA was later ceded to FUN and then to TAR. A dispute arose when Toerien claimed it was overcharged due to a handwritten amendment to the MRA, increasing the monthly rental from R6,235.80 to R11,426.47. Toerien argued that the amendment was invalid due to a non-variation clause in the MRA, which required any changes to be in writing and signed by both parties. Toerien cancelled the MRA, tendered the return of the printers, and claimed a refund of overpayments (R209,130.88). The plaintiffs, in turn, claimed R451,466.66 from Toerien and Sage, or alternatively from Oxbow, based on warranties and indemnities in the cession agreements.

Issue: The key issues were whether the handwritten amendment to the MRA was valid, given the non-variation clause; whether the plaintiffs had locus standi to enforce the MRA, given the cession agreements; whether Toerien's counterclaim for overpayments was valid; and whether Oxbow was liable to the plaintiffs for breach of warranties and indemnities in the cession agreements.

Discussion: The court examined the validity of the handwritten amendment to the MRA, which was initialled by Sage (representing Toerien) but not by Oxbow. The court found that the amendment did not comply with the non-variation clause, which required any changes to be in writing and signed by both parties. As a result, the amendment was invalid, and the MRA remained in its original, unamended form. The court also dismissed the defendants' arguments regarding the plaintiffs' locus standi, finding that the cession agreements were valid and enforceable. On Toerien's counterclaim, the court found that Toerien had not been impoverished, as the overpayments were offset by the payment made to settle the CBA debt. The court also rejected Oxbow's public policy defense, finding that the non-variation clause was not contrary to public policy and that Oxbow had failed to provide a valid reason for not complying with the clause. Finally, the court found that the plaintiffs' claims against Oxbow failed because the warranties and indemnities in the cession agreements related to the unamended MRA, which had not been breached.

Findings: The handwritten amendment to the MRA was invalid due to non-compliance with the non-variation clause. The plaintiffs had locus standi to enforce the MRA, as the cession agreements were valid. Toerien's counterclaim for overpayments failed, as the overpayments were offset by the payment made to settle the CBA debt. Oxbow was not liable to the plaintiffs, as the warranties and indemnities in the cession agreements related to the unamended MRA, which had not been breached.

Order: The plaintiffs' claims against Toerien and Sage were dismissed. The plaintiffs' claims against Oxbow were dismissed. Toerien's counterclaim against the plaintiffs was dismissed. No order as to costs was made, as the court found that the plaintiffs, Toerien, and Oxbow were all partially responsible for the dispute.

Facts: A Rule 43 Order was granted wherein the applicant was ordered to pay maintenance to the respondent in an amount of R30,000 per month and directed to register and retain the respondent as a registered dependent on his medical aid scheme and be responsible for all levies and premiums pertaining thereto, pendente lite. The respondent approached the Registrar for a warrant of execution for arrears, flowing from the Rule 43 Order, being an amount of R111,496.01, supported by an Affidavit, for arrears up to November 2022. The warrant of execution was issued by the Registrar after considering, the Rule 43 Order, supporting Affidavit, the breakdown and supporting documents.

Issue: The applicant avers that he is not in arrears and in fact is in credit. The applicant launched an application to set aside and rescind the warrant of execution for various reasons, among which the applicant contends the word “levy” as referred to in the Rule 43 Order does not include additional medical expenses not covered by the medical aid scheme being the interpretation by the respondent and hence included in terms of the warrant of execution and the applicant referred to section 2(1)(a) of the Council for Medical Scheme Levies Act, 58 of 2000 defining levies as general administrative and other costs of the Council and functions performed by the Registrar of Medical Schemes.

Discussion: A writ of execution will, on application, be set aside as incompetent, if the judgment was not definite and certain where the amount payable under the judgment can be ascertained only after deciding a further problem. In De Crespigney v De Crespigney 1959 (1) SA 149 it was held to be unnecessary to decide what degree of factual uncertainty in a judgment renders execution incompetent. Even under the wide language of Rule 45(1), there can be a degree of uncertainty in a judgment, which makes it incompetent for a writ to be issued under it. It is clear from the Rule 43 Order, that no provision is made therein for the respondent to claim for medical aid premiums in respect of a medical aid scheme procured by the respondent, the obligation being that the applicant is to register the respondent on his current medical aid scheme, at his cost. Therefore, the expenses claimed by the respondent in respect thereof, is not competent and cannot be claimed for.

Findings: Given the exclusions from the Rule 43 Order pertaining to the medical aid expenses and legal costs and the uncertainty pertaining to the reference to “levies”, having regard to the breakdown relied upon by the respondent in support of the warrant of execution, it is not clear precisely what is outstanding if anything and owed by the applicant to the respondent. Whilst the respondent provided a detailed schedule of the computation of amounts, she alleges as outstanding in terms of the Rule 43 Order, the difficulty, however, is that she went beyond the parameters of the Rule 43 Order and included amounts not competent and uncertain as being in terms of the Rule 43 Order.

Order: The warrant of execution was set aside. The goods attached by the Sheriff pursuant to the warrant of execution were released from such attachment.

Facts: The applicant, T.M.C., and the respondent, M.P.K., were married in 2007 and have a minor child, K.L.M., born in 2017. The parties separated in August 2019, and the applicant initiated divorce proceedings in February 2023. The respondent disputes the validity of their customary marriage. The applicant filed a Rule 43 application seeking interim maintenance for herself and their minor child, pending the finalization of the divorce. She claims the respondent, who has been the sole provider for over 12 years, has ceased financial support since the divorce proceedings began. The respondent opposes the application, arguing that the marriage is invalid, and that the applicant has not adequately demonstrated her need for maintenance.

Issue: The main issue is whether the applicant and the minor child are entitled to interim maintenance under Rule 43, pending the finalization of the divorce, and whether the respondent has the financial means to provide such maintenance.

Discussion: The court considered the respondent’s points in limine, including his challenge to the validity of the marriage and alleged non-compliance with Rule 43 procedures. The court rejected these arguments, citing case law that allows Rule 43 applications even when the validity of the marriage is disputed. The court emphasized the importance of protecting the best interests of the child, as mandated by the Constitution. The applicant provided a detailed financial disclosure form (FDF) outlining her expenses, while the respondent failed to submit his FDF or provide evidence of his inability to pay maintenance. The court found the applicant’s claimed expenses reasonable and noted that the respondent had historically supported the family financially.

Findings: The court concluded that the applicant and the minor child are in need of interim maintenance and that the respondent has the financial means to provide it. The court dismissed the respondent’s technical objections and found that the applicant’s claims were reasonable and supported by evidence. The court also emphasized the temporary nature of Rule 43 orders, which are intended to provide interim relief until the divorce is finalized.

Order: The court granted the applicant’s Rule 43 application, ordering the respondent to pay interim maintenance of R20,824.87 per month for the applicant and the minor child. This amount is to be adjusted annually based on the Consumer Price Index. The respondent is also required to cover the child’s school fees, medical expenses, and clothing. The costs of the application were reserved for determination by the trial court.

Facts: The case involves an application by C.W.L. (applicant) against N.D.L. (respondent) for a variation of a Rule 43 order. The parties were married out of community of property, with no accrual system, and have two adult children. The applicant moved out of the marital home in June 2020 and initiated divorce proceedings. The applicant seeks an increase in monthly maintenance from R22,500 to R35,000 and a further contribution of R660,000 towards her legal costs. Both parties are unemployed, and the respondent claims financial hardship, relying on savings to meet expenses. The applicant argues that her health issues and inability to find employment constitute a material change in circumstances justifying the variation.

Issue: The primary issue is whether there has been a material change in circumstances warranting a variation of the Rule 43 order, particularly regarding maintenance and legal costs. Additionally, the court must decide whether to allow the filing of supplementary affidavits by the applicant.

Discussion: The court examined the financial circumstances of both parties, noting that the applicant relies on the respondent’s maintenance payments and has no independent income. The respondent, though unemployed, has significant assets and has historically maintained an opulent lifestyle for the applicant. The court emphasized that Rule 43(6) allows for variation if there is a material change in circumstances or if the initial contribution to legal costs proves inadequate. The applicant failed to demonstrate a material change in circumstances for increased maintenance but showed that the initial contribution to legal costs was insufficient. The court also addressed the respondent’s objection to the filing of supplementary affidavits, ruling that it was in the interest of justice to allow them.

Findings: The court found that the applicant did not prove a material change in circumstances to justify an increase in maintenance. However, it concluded that the respondent could afford to contribute further to the applicant’s legal costs, given his financial position. The respondent’s net estate is worth R11,000,000, inclusive of all the moneys in bank accounts, investments, immovable and movable property. The court also allowed the filing of supplementary affidavits to ensure a fair hearing.

Order: The applicant’s supplementary and further supplementary affidavits were permitted. The respondent was ordered to pay a further contribution of R660,000 towards the applicant’s legal costs. The costs of the application were reserved for determination by the trial court in the main divorce proceedings.

Facts: Solidarity, a trade union, brought an urgent application on behalf of three of its members employed as educators at Hoërskool Belville. The union sought declaratory and consequential relief after the department declared the three members "additional" to the school’s staff establishment. The union argued that the process of declaring its members as additional staff was unfair and sought to compel the department to comply with retrenchment consultation obligations under sections 189 and 189A of the Labour Relations Act 66 of 1995. The union also requested that the transfer process be halted pending the outcome of a dispute referred to the bargaining council regarding the interpretation of a collective agreement. The respondents opposed the application, arguing that the process was fair and that the application was premature and lacked urgency.

Issue: The main issue was whether the department’s decision to declare the union’s members as additional staff triggered the obligation to initiate retrenchment consultations under sections 189 and 189A of the LRA. Additionally, the court had to determine whether the application was urgent and whether the union’s request to halt the transfer process pending the dispute resolution was justified.

Discussion: The court examined whether the department’s actions constituted a contemplation of retrenchment, which would require consultation under the LRA. The court noted that the department had not yet reached the stage of actively contemplating retrenchments, as it was still attempting to place the affected educators in alternative posts through a matching and placement process. The court also found that the union’s application was premature, as the department had not finalized any retrenchment decisions. Furthermore, the court criticized the union for imposing an unreasonably short timeframe for the respondents to file answering affidavits, which undermined the urgency of the application. The court concluded that the dispute resolution process through the bargaining council provided an adequate remedy, and there was no need for interim relief.

Findings: The court found that the application was premature and lacked sufficient urgency. The department had not yet reached the stage of contemplating retrenchments, and the union’s concerns about potential retrenchments were speculative at this point. The court also found that the union’s request to halt the transfer process was unnecessary, as the dispute resolution process through the bargaining council was still ongoing. The court emphasized that the declaration of educators as additional staff did not equate to pre-determining retrenchment criteria, and the department would still need to consult on fair selection criteria if retrenchments were contemplated in the future.

Order: The application was struck off the roll for lack of urgency. No order was made as to costs, considering the ongoing relationship between the parties and the requirements of law and fairness.

Facts: The applicant, Mokoena, a 98-year-old former reverend of the Church of the Holy Ghost, sought a declaration that he is an occupier under the Extension of Security of Tenure Act (ESTA) and that his family has the right to bury him on the church’s burial site where his adoptive parents are buried. The applicant has been a member of the church since 1953 and resided on the church’s farm since 1975. After a leadership dispute in the church, the applicant was expelled, and his membership was terminated, leading to the denial of his burial rights on the church’s property. The respondent opposed the application, arguing lack of urgency and disputing the applicant’s status as an occupier under ESTA.

Issue: The main issues were whether the applicant qualified as an occupier under ESTA and whether his family had the right to bury him on the church’s burial site upon his death.

Discussion: The court found that the applicant met the criteria of an occupier under ESTA, as he had resided on the church’s farm for over ten years and was over 60 years old. The court emphasized that ESTA is remedial legislation aimed at protecting individuals with insecure land tenure, and its provisions should be interpreted purposively. The respondent’s argument that the applicant failed to disclose his income was dismissed, as the court focused on the broader purpose of ESTA. The court also rejected the respondent’s claim that there was no established practice of burying non-members on the farm, noting that the case concerned the burial of the occupier himself, not a family member, making section 6(5) of ESTA applicable.

Findings: The court concluded that the applicant was an occupier under ESTA and that his family had the right to bury him on the church’s burial site in accordance with section 6(5) of ESTA. The respondent’s failure to provide evidence of the applicant’s expulsion from the church further supported this conclusion. The court also found no exceptional circumstances to warrant a costs order against the applicant.

Order: The applicant is declared an occupier under ESTA. Upon the applicant’s death, his family has the right to bury him at the designated burial site where his adoptive parents are buried. In case of non-compliance by the respondent, the Sheriff and South African Police are authorized to assist the family in burying the applicant.