top of page
Top

CASE LAW UPDATE

5 February 2025

21 January 2025

MOTHA J

CONSUMER – Credit agreement – Proceedings against consumer â€“ Whether Certificate of Balance (COB) proof of indebtedness – Whether respondents bore onus of proving incorrectness of amount claimed â€“ Respondents argued that section 129(1)(a) notice reflected incorrect arrears amount â€“ Court a quo correctly found that section 129 notice was not complied with – Notice must reflect correct arrears amount, together with a breakdown of that amount â€“ National Credit Act 34 of 2005, s 129.

Facts: As security for their indebtedness arising from the agreement with the bank, Mr and Ms Reineke (respondents) registered mortgage bonds over two immovable properties. Following the respondents’ default in complying with the terms of the parties’ agreement, the appellant launched an application to claim the payment of the amount due and further relief. The court a quo considered the arguments around the Certificate of Balance (COB) and the section 129 notice. The court a quo found for the defendants.


Appeal: The grounds of appeal included that the court a quo erred in finding that the appellant’s application was defective and that the court a quo erred in finding that the appellant had not complied with the National Credit Act 34 of 2005 (NCA).


COB: The respondents submitted that a Certificate of Balance (COB) was not evidence nor conclusive proof of indebtedness and that the respondents bear no onus of proving the incorrectness of the amount claimed by proving what the correct amount is. The appellant relied on case law which held that a COB is conclusive proof of the amount of indebtedness and that the defendant had to rebut that evidence. Counsel for the appellant submitted that the court reversed the onus onto the bank to prove the amount set out in the COB. The court corrected him that it was a rebuttal not an onus. Counsel for the appellant doubled down on the submission that it was on the respondents to provide statements and proof of payment. He submitted that there was no evidence before the court placing the COB in dispute or that they did not receive statements. However, the amount claimed was put into question and this court cannot find fault with the court a quo’s conclusion.


Section 129: The appellant dispatched a section 129(1)(a) notice stating that the respondent’s account was in excess of R2,145,475.28. The respondents argued that the section 129(1)(a) notice reflected an incorrect arrears amount, thus contravening the provisions of the NCA. To add insult to injury, the appellant’s letter of demand recorded that the arrears on the loan facility were R70,412.48. It was impossible that eleven months later, the respondents owed R2145,475.28, which is a far cry from the R70,412.48. The failure to comply with the NCA is so egregious that on this point alone the matter should have been dismissed. The court a quo correctly found that the section 129 NCA notice was not complied with, which must reflect the correct arrears amount, together with a breakdown of that amount. Additionally, section 130(1)(b) of the NCA was also violated (consumer not responding or rejecting proposals).


Order: The appeal is dismissed with costs on scale C.

MOTHA J (JANSE VAN NIEWENHUIZEN J and FRANCIS-SUBBIAH J concurring)

4 February 2025

RONAASEN AJ

FAMILY – Divorce – Pension â€“ Marriages concluded out of community of property and without accrual â€“ Disadvantaged economic position of women â€“ Section 7(7)(c) of the Divorce Act 70 of 1979 – Unfair discrimination on basis of gender â€“ Excluding spouse in post-1984 marriage from claiming redistribution in respect of pension interests of other spouse â€“ Withholding from one class of spouses, in particular women in that class, a fair judicial remedy – Section declared inconsistent with Constitution and invalid.

Facts: Mr and Mrs D were married to each other in 2004, out of community of property, with the exclusion of the accrual system. The antenuptial contract records that there would be no community of property and loss between them and that the accrual system would not apply to their marriage. D states that, although she did engage in projects that were designed to achieve a profit during the subsistence of the marriage, her primary focus during the marriage was the management of the family home and supporting Mr D in his career and in his business and personal endeavours. Her role, like the role of many women, included caring for the three children born of the marriage (all of whom are still minors), prioritising their development and well-being and their best interests. Her efforts materially contributed to the growth and maintenance of Mr D's estate.


Application: By reason of the alleged irretrievable breakdown of the marriage relationship, Mrs D instituted an action for divorce against Mr D in 2020. The purpose of this application is to obtain an order declaring section 7(7)(c) of the Divorce Act 70 of 1979 unconstitutional and invalid. It is contended that the section excludes pension interests from the redistribution remedy that is now available in respect of all marriages concluded out of community of property and without accrual, regardless of the date of their conclusion.


Discussion: In a sea change, the Constitutional Court handed down judgment in KG v Minister of Home Affairs [2023] ZACC 32. The impugned section, so it is submitted, is unconstitutional because it is it is irrational. In a post-KG world, there is no rational reason for the exclusion of pension interests from redistribution. It is excluding a spouse in a post-1984 marriage from claiming a redistribution in respect of the pension interests of the other spouse. The reason KG declared section 7(3) unconstitutional and invalid is that it had a disproportional impact on women who were more likely to be the economically weaker partner. The same logic applies to all assets, including pension interests. The evidence shows that men are more likely to have pensions and are likely to have larger pensions. Women’s disadvantaged economic position means that they are less likely to have pensions, and likely to have smaller pensions. They are therefore more likely to be prejudiced by the absence of a redistribution remedy in respect of those assets than men.


Findings: The impugned section unfairly discriminates for reasons that are almost identical to the reasons for which the Constitutional Court in KG concluded that section 7(3) unfairly discriminated. Although the impugned section, like section 7(3), directly distinguishes on the basis of the date of the marriage, its effect is gendered. Women are more likely to be affected by the continued exclusion of pension interests from redistribution than men. In line with KG, it cannot be a fair form of discrimination to withhold from one class of spouses and in particular women in that class, a fair judicial remedy of which they may have as much need as other spouses. It cannot be fair. In this case the whole of the impugned section is invalid. It does not do anything other than what is unconstitutional by excluding a spouse in a post-1984 marriage from claiming a redistribution in respect of the pension interests of the other spouse. It is thus invalid in its entirety.


Order: Section 7(7)(c) of the Divorce Act 70 of 1979 is declared to be inconsistent with the Constitution and invalid. This order shall not affect the legal consequences of any act done or omission or fact existing before this order was made in relation to a marriage concluded on or after 1 November 1984. The Minister is directed to pay the applicant's costs, and the costs of the applicant's counsel are to be taxed on Scale C.

RONAASEN AJ

21 January 2025

NCUBE J

LAND TENURE – Restitution of rights – Compensation – Allegations of inadequate compensation based on irrelevant considerations – Seeking to set aside settlement agreements – Respondent failed to consider individual circumstances of each applicant – Hardship caused by dispossession – Application of blanket compensation based on irrelevant RDP housing subsidy value – Reliance on recommendation was flawed – Set aside and declared invalid – Restitution of Land Rights Act 22 of 1994, s 33.

Facts: The case involves two consolidated applications brought by five applicants against the Minister of Rural Development and Land Reform, the Director General, the Chief Land Claims Commissioner, and the Regional Land Claims Commissioner (RLCC). The applicants sought to review and set aside the RLCC's decision to settle their land claims for R36,000 each, which they argued was inadequate and based on irrelevant considerations. They argued that the RLCC failed to consider relevant factors such as the history of dispossession, the hardship caused, and the value of the lost tenancy rights. They also contended that the RLCC relied on an irrational recommendation from Vadec Consultants, which based compensation on the value of an RDP housing subsidy, an irrelevant factor. The applicants also sought to have the settlement agreements declared invalid and the matter referred to the Land Court for proper consideration. The respondents gave notice to raise a point in limine. The point raised was one of prescription.


Application: The applicants applied for an order reviewing and setting aside the decision of the RLCC to settle their land claims which they had lodged in respect of the dispossession of their rights to the farm Veesplaas in the 1960’s in a blanket amount of R36,000 each. The applicants further sought an order setting aside the settlement agreements entered into in respect of the land claims and the remittal of the land claims to the RLCC. In the alternative, the applicants sought an order directing the RLCC to refer the settlement agreements to court for a consideration in terms of section14 (3A) and 4 of the Restitution of Land Rights Act 22 of 1994. The main issue was whether the RLCC's decision to pay a blanket compensation of R36,000 to all applicants was rational, reasonable, and procedurally fair, and whether the settlement agreements should be set aside.


Discussion: The respondents averred that the applicants were basing their claims on contracts which were concluded and performed or should have been performed by the respondents before the end of 2011. The so-called point in limine was misplaced. The applicants did not lay a claim based on breach of contract. The applicants sought a review and setting aside of the decision that led to the conclusion of settlement agreements as well as the agreements themselves. The other difficulty with the respondents’ points in limine is that the respondents never raised prescription as a defence in their answering affidavit. Regarding the delay in bringing the review application, the court found that the applicants had provided a reasonable explanation, including financial constraints and the hope that the RLCC would pay the full compensation promised. The court extended the 180-day period to 10 May 2022, the date the review application was instituted.


Findings: The court found that the RLCC's decision was irrational and unreasonable. The RLCC failed to consider the individual circumstances of each applicant, such as the nature of their tenancy, the value of their lost rights, and the hardship caused by dispossession. Instead, the RLCC applied a "one-size-fits-all" approach based on the irrelevant RDP housing subsidy value. The court also noted that the RLCC's reliance on Vadec Consultants' recommendation was flawed, as it merely echoed the RLCC's pre-existing preference rather than providing an independent assessment. The court further held that the RLCC's decision-making process violated the principles of administrative justice under PAJA and the Constitution. The RLCC did not take into account the factors prescribed by section 25(3) of the Constitution and section 33 of the Restitution Act, which require consideration of the history of dispossession, the current use of the land, and the market value of the property, among other factors. The RLCC's decision to pay R36,000 as compensation was irrational, unreasonable, and based on irrelevant considerations. The settlement agreements were declared invalid. The court ordered the RLCC to refer the matter to the Land Court for proper consideration of the applicants' claims, including the hardship and loss suffered.


Order: The point in limine raised by the respondents (prescription) was dismissed. The 180-day period under section 7(1) of PAJA was extended to 10 May 2022. The decision to pay R36,000 compensation to each applicant was reviewed, set aside and declared invalid. The settlement agreements entered into by the applicants were reviewed, set aside and declared invalid. The RLCC was ordered to refer the matter to the Land Court under section 14(3A) and (4) of the Restitution of Land Rights Act.

NCUBE J

22 January 2025

LABUSCHAGNE J

LEGISLATION – Firearms – Serial number on barrel – Unitary barrel – Legal interpretation of provision – Regulations suggest that barrel can be unchambered, partially chambered, or pre-chambered – Serial number on chamber portion of barrel satisfies requirement – Firearms with unitary barrels and properly engraved serial numbers on chamber and other prescribed parts may be transferred and sold under permanent import permits – Firearms Control Act 60 of 2000, s 23.

Facts: The case involves the South African Arms and Ammunition Dealers’ Association NPO and two other applicants challenging the decision of the Central Firearms Registry (CFR) to reverse or withdraw permissions allowing the applicants to transfer and sell imported firearms. The dispute centers on whether the serial numbers engraved on the chamber portion of a unitary barrel (where the barrel and chamber are made from a single piece of metal) comply with section 23(2) of the Firearms Control Act 60 of 2000, which requires serial numbers to be engraved on the barrel and frame or receiver of the firearm. The CFR contends that the serial number must be on the barrel itself, not just the chamber, while the applicants argue that the chamber is part of the barrel in unitary barrels.


Application: The applicants approached the court on the basis of urgency for an order declaring as invalid the decision of the respondent to reverse or withdraw her permission to allow the applicants to transfer onto its dealers’ stock and sell Sarsilmaz pistols, Glock pistols, and Canik pistols imported into South Africa. Further, for an order declaring that, where a barrel has a serial number engraved over the chamber area, where the chamber is an integral part of the barrel, that such unitary barrel with a serial number properly engraved over the chamber area, complies with the provisions of section 23 of the Firearms Control Act 60 of 2000. The core issue is whether a unitary barrel complies with section 23(2) of the Firearms Control Act, which requires serial numbers to be engraved on the barrel and frame or receiver of the firearm.


Discussion: The court analyzed the text, context, and purpose of section 23(2) of the Firearms Control Act and Regulation 28(2) of the Firearms Control Regulations. The court found that the Act does not define "barrel," but the regulations suggest that a barrel can be unchambered, partially chambered, or pre-chambered. The court concluded that where the barrel and chamber are a single unitary component, the serial number on the chamber portion of the barrel satisfies the requirement of section 23(2). The court emphasized that the purpose of the Act is to ensure that serial numbers are visible without disassembling the firearm, which is achieved in this case. The court rejected the CFR's argument that the chamber is a separate component, noting that requiring a second serial number on the barrel would be impractical and contrary to the Act's purpose.


Finding: Serial numbers are required for identification of the firearm with reference to records of the manufacturer. It is a requirement of efficient inspection of firearms that the serial numbers be visible without disassembling the firearm. In the case of the Glock, as in respect of the other firearms relevant to proceedings, the serial number pertaining to the barrel appears on that component of the chamber which forms part of the barrel as a single unitary barrel forged from a single piece of metal. If the respondent’s requirement of a separate engraving of a serial number on the barrel is required, it is, particularly with reference to the Glock, not apparent where that serial number could be placed so that it could be visible without disassembling the firearm. Practically, that component of the barrel that covers the chamber is the only portion visible if the firearm is assembled. The court found in favour of the applicants. 


Order: The court declared that a unitary barrel with a serial number engraved on the chamber portion complies with section 23(2) of the Firearms Control Act. The court declared that firearms with unitary barrels and properly engraved serial numbers on the chamber portion and other prescribed parts may be transferred and sold under permanent import permits. The declaratory orders do not constitute a final definition of a firearm, pistol, or barrel. The respondents were ordered to pay the costs of the application, including the costs of senior counsel.

LABUSCHAGNE J

ALERTS SPACER

ALERTS SPACER​

ALERT TOPIC SPACER

ALERTS SPACER

ALERTS SPACER​

VIOLENCE AND STRIKES

Container Depots applied to the Labour Court on an urgent basis to declare a strike by its employees unprotected. On the evening of the first day of the strike, one of the applicant’s employees who had not participated in the strike was shot and killed on his way home from work at the vicinity of the Ntuzuma/Phoenix taxi rank in Durban. An employee of a contractor appointed to the applicant, FXO, was shot and killed at the self-same taxi rank at some point thereafter, although the timing of such incident was not described. Three days later, an unknown number of employees who were leaving the applicant’s premises after work were shot at on the corner of South Coast and Bayhead Roads. Another individual in the employ of another of the applicant’s contractors, Adcorp Blu, was later shot and killed at the Umbilo train station in the early hours of the morning.

RESTRAINT, FOOD COLOURANTS AND FLAVOURS

Roha SA Ingredients (Roha) sought to enforce a restraint of trade clause against its former employee, Gerhardt (first respondent), who resigned and joined Nicola-J Flavours and Fragrances (Nicola-J) as a sales manager. Roha operates in the food colourants market, while Nicola-J primarily deals in food flavours and fragrances, with a minor colourant component. Gerhardt’s role at Roha involved sales in Sub-Saharan Africa, particularly Zambia and Zimbabwe, while his new role at Nicola-J is focused on South Africa. The court found that while there was some overlap in the colourant market, the competition was minimal, and Gerhardt’s new role did not involve competing with Roha. Additionally, Roha failed to provide sufficient evidence of confidential information or trade connections that Gerhardt could exploit.

​​

​

​​​LATEST ONLINE NEWS  (click on heading to view article)

​

Anglican Church released its report into handling of John Smyth abuse scandal by SA church activities.

Sentenced to life in 1995 with Judge saying he was giving them life without the possibility of parole.

One commuter killed, several suffer gunshot wounds after CIT heist shootout spread across locations.

Political analyst said there were valid concerns about the policy environment within SA.

Troops in the DRC endure extreme hardships, with repatriation delays deepening families’ suffering.

Employees alleged NPO engaged in illegal labour practices including late or non-payment of salaries.

The impacts of that regime are still apparent in this country, especially among those it targeted.

Not just a structural blight but a significant threat to public safety and economic stability.

Durban gun dealer who allegedly sold assault rifles to the notorious Terrible Josters gang.

The woman accused of selling her two-year-old son Kutlwano - She reported him missing.

Ithala will now have to deal with the SIU amid liquidation woes.

The state did not oppose bail, but argued it should be set with conditions.

Judge upholds ruling in favour of Special Investigating Unit.

Despite being unemployed, the bank account of Darren Wilken had annual turnover of over R2,5m in 2023.

Suspected of being part of a diamond syndicate that allegedly defrauded investors out of R4-billion.

“The motive of the shooting is unknown at this stage and the police are following up on all the leads."

In a circulating video on social media, two female officers are seen beating the complainant repeatedly.

Some toilets at Denise Residence also lacked seats, further exacerbating infrastructure concerns.

The government provides housing on the outskirts of the city, far from jobs, services, and opportunities.

Decision is awaited on whether a hotel development next to the historic mosque should proceed.

​​

​

​​​ARTICLES AND UPDATES

​

"[AI] allows you to cram five years' experience into 30 seconds of prompt engineering."

Only in very limited cases would they not be compensated.

Groundup asked educationist Paula Ensor to provide a summary of BELA and the stormy controversy.

A busy week for those who choose to litigate in the name of black economic empowerment (BEE).

Not due to the app's Chinese origins but because of the "unacceptable risk" it poses to national security.

DRC communications minister said Rwanda’s military presence in his country was well documented.

The murder of a woman they accused of witchcraft after a wife of one accused had dream about deceased.

Rushdie spent six weeks in hospital after being stabbed up to 10 times on stage at an event.

He's also facing federal charges in a racketeering and sex trafficking scheme.

Her parents insisted she’d been murdered - The pathologist just changed his mind.

Raising questions about whether an unelected businessman can wield this kind of authority.

An unprecedented – and legally problematic deal – that has alarmed critics and rights groups.

Alert Cases

​​

​

​​​TEN FURTHER CASES

​

30 January 2025

MARAIS AJ

CIVIL PROCEDURE – Execution – Primary residence – Settlement agreement fell within definition of credit agreement – Deferred payment and included interest – Reckless credit provisions did not apply to settlement agreement – Provisions are intended to regulate initial credit agreements not settlements – Applicant failed to comply with s 129 and s 130 of Act and Rule – Application postponed sine die pending compliance – National Credit Act 34 of 2005 – Uniform Rule 46A.

Facts: ABSA Bank Limited (the applicant) instituted action against Goolam (the respondent) for payment of an outstanding balance under two mortgage loan agreements secured by mortgage bonds over the respondent’s primary residence. After the action was initiated, the parties concluded a settlement agreement in April 2016, which novated the original loan agreements. The respondent acknowledged liability and agreed to pay the debt in instalments, with consent to judgment and execution against her property in case of default. The settlement agreement was made a court order but did not constitute an executable judgment. When the respondent defaulted, ABSA applied for judgment and an order declaring the property executable in 2020. The respondent initially raised defences based on misrepresentation and denied concluding the loan agreements, but these were abandoned. She later argued that the settlement agreement was a credit agreement under the National Credit Act 34 of 2005 (NCA), that the applicant failed to conduct a credit assessment, and that the applicant did not comply with sections 129 and 130 of the NCA before launching the application.


Issue: The key issues were whether the settlement agreement constituted a credit agreement under the NCA; whether the reckless credit provisions of the NCA applied to the settlement agreement; whether the applicant complied with sections 129 and 130 of the NCA before launching the application; and whether the applicant complied with Rule 46A regarding the execution against the respondent’s primary residence.


Discussion: The court found that the settlement agreement fell within the definition of a credit agreement under section 8(4)(f) of the NCA, as it deferred payment and included interest. However, the reckless credit provisions (sections 80-83) did not apply to the settlement agreement, as these provisions are intended to regulate initial credit agreements, not settlements. The court also held that the applicant was required to comply with sections 129 and 130 of the NCA before enforcing the settlement agreement, as these provisions ensure consumers are afforded opportunities to resolve disputes or restructure debts. The applicant’s failure to comply with these sections rendered the application premature. The court further noted that the applicant did not comply with Rule 46A, which governs execution against primary residences, as it failed to provide a proper valuation of the property.


Findings: The court held that the settlement agreement was a credit agreement under the NCA; the reckless credit provisions did not apply to the settlement agreement; the applicant failed to comply with sections 129 and 130 of the NCA, necessitating an adjournment of the application; and the applicant did not comply with Rule 46A. The court also found that the respondent’s conduct in raising non-compliance with the NCA as a dilatory defence, without intending to utilise the remedies provided by the NCA, amounted to an abuse of the court process.


Order: The respondent’s counterapplication was dismissed with costs. The applicant’s application for judgment was suspended and postponed sine die, pending compliance with section 129 of the NCA. The respondent was granted 15 days to refer the settlement agreement to a debt counsellor or alternative dispute resolution agent. The applicant’s Rule 46A application was postponed sine die.

27 January 2025

DIPPENAAR J

COMPANY – Winding up – Abuse of process – Damages claim – Alleged application was for ulterior purposes of scuppering commercial transaction – Section 347(1A) interpretation – Defendants narrow interpretation rejected – Provision does not limit damages claim determination to court hearing winding-up application – Does not impose temporal or jurisdictional restrictions – Claim fell within ambit of section – Exceptions dismissed – Companies Act 61 of 1973, s 347(1A).

Facts: The case involves an exception taken by the defendants (Randvest Capital Investments (Pty) Ltd and Christiaan Jozua Eskell Klagsbrun) against the plaintiff (REH Investments (Pty) Ltd). The plaintiff had instituted claims against the defendants for damages arising from the alleged wrongful and intentional launching of a winding-up application, which the plaintiff claimed was malicious, vexatious, and aimed at disrupting a commercial transaction. The defendants argued that the plaintiff’s particulars of claim lacked sufficient averments to sustain a cause of action, particularly under section 347(1A) of the 1973 Companies Act and section 77(2)(a) of the 2008 Companies Act.


Issue: The key issues were whether the plaintiff’s claim under section 347(1A) of the 1973 Companies Act was excipiable due to the absence of a prior court finding that the winding-up application was an abuse of process; and whether the plaintiff’s claim under section 77(2)(a) of the 2008 Companies Act was excipiable due to the failure to allege specific facts demonstrating a breach of fiduciary duty by the second defendant.


Section 347(1A) of the 1973 Companies Act: The defendants argued that the plaintiff could only claim damages under this section if a court had already determined that the winding-up application was abusive or malicious. The court rejected this narrow interpretation, holding that the provision does not limit such a determination to the court hearing the winding-up application. The court emphasized that the wording of the section is broad and does not impose temporal or jurisdictional restrictions. The plaintiff’s claim was based on the alleged improper intent behind the winding-up application, which fell within the ambit of the section.


Section 77(2)(a) of the 2008 Companies Act: The defendants contended that the plaintiff failed to plead material facts showing that the second defendant breached his fiduciary duties under section 76(3). The court found that the particulars of claim, when read as a whole, sufficiently pleaded the second defendant’s conduct and intention, which allegedly breached his statutory duties. The court noted that the plaintiff was not required to plead all evidentiary details (facta probantia) but only the essential facts (facta probanda) to sustain the cause of action.


Findings: The court held that the plaintiff’s claim under section 347(1A) was not excipiable. The defendants failed to show that the claim lacked legal merit or that they would suffer prejudice if the claim proceeded. The plaintiff’s claim under section 77(2)(a) was also not excipiable. The particulars of claim, read in context, contained sufficient averments to sustain the cause of action against the second defendant.


Order: The court dismissed both exceptions with costs, including the costs of senior counsel, as the defendants had not made out a clear case that the claims were excipiable on every possible interpretation.

4 November 2024

JANISCH AJ

COMPANY – Shareholders meeting – Financial statements – Whether proposed resolution for approval of financial statements complied with Act – Does not require shareholder approval of financial statements once they have been approved by board and independently reviewed – Proposed resolution served no legal purpose since statements had already been approved by directors – Application dismissed – Companies Act 71 of 2008, ss 30(3) and 65(4).

Facts: The case involves Korevest Leisure Group B.V. (the applicant) and several respondents. The dispute stems from ongoing litigation following the resignation of Mr. Korver, the sole shareholder and director of the applicant, from the third respondent (Korevest Investments Group) in 2016. The applicant, holding 47% of the shares in the third respondent, sought to interdict a shareholders' meeting where a resolution to approve the annual financial statements for 2016-2023 was to be proposed. The applicant argued that the resolution did not comply with section 65(4) of the Companies Act 71 of 2008, which requires sufficient information to be provided to shareholders to make an informed decision. The applicant also demanded access to extensive financial and accounting documents to verify alleged irregularities in the financial statements.


Issue: The primary issue was whether the proposed resolution for the approval of the financial statements complied with section 65(4) of the Companies Act, which mandates that resolutions must be accompanied by sufficient information to enable shareholders to make informed decisions. Additionally, the court had to determine whether the applicant was entitled to the extensive list of documents it requested.


Discussion: The court examined the statutory framework under the Companies Act, particularly sections 30 and 65(4). It noted that the Act does not require shareholder approval of financial statements once they have been approved by the board and independently reviewed. The court found that the proposed resolution, which sought shareholder approval of the financial statements, served no legal purpose since the statements had already been approved by the directors. The court also considered whether the applicant was entitled to additional information under section 65(4) and concluded that, given the limited legal significance of the resolution, the shareholders did not require further information beyond the financial statements and their approval by the board.


Findings: The court found that the resolution was unnecessary and had no legal effect, as the financial statements had already been approved by the directors. The court also held that the applicant was not entitled to the extensive list of documents it requested, as the resolution did not require additional information for shareholders to make an informed decision. The court dismissed the applicant's application and the accompanying striking-out application, which sought to remove certain allegations from the respondents' answering affidavit.


Order: The court dismissed the applicant's application and the striking-out application. No order as to costs was made, as both parties were found to have contributed to unnecessary litigation. The court emphasized that the resolution served no legal purpose and that the withdrawal of the resolution by the Respondents would have avoided the litigation.

10 January 2025

FISHER J

COMPANY – Business rescue – Setting aside resolution – Company was financially distressed – Could not pay debts including a significant tax liability – Argument that debts had been extinguished through contrived cession arrangements rejected – Complied with procedural requirements for business rescue – BRPs were deemed independent and competent to manage company’s business rescue – Claims of conspiracy unsubstantiated – Application dismissed – Companies Act 71 of 2008, ss 130(1).

Facts: The case revolves around a dispute over control of a valuable manganese mine in Kuruman, Northern Cape, owned by Wepex Trading (Wepex). The mine, which had been dormant since the 1980s, was revived in 2018 under the control of Piper, who also founded Glosam Manganese (Glosam) to manage mining operations. The mine became profitable due to rising manganese prices, but a conflict arose between Piper and Dyason, who had provided significant funding to keep the mine operational during its unprofitable years. Dyason, through his entities (Mazule and Fujax), sought to recover debts owed by Glosam and Wepex, while Piper and Louis Neethling (a director of Wepex) diverted the mine's income to a new entity, GMM, bypassing Glosam. This led to Glosam being placed under business rescue, and Wepex facing a business rescue application by Glosam. Piper and Wepex sought to set aside Glosam's business rescue resolution and remove the business rescue practitioners (BRPs), alleging a conspiracy by Dyason to take control of the mine.


Issue: The key issues were whether Glosam was financially distressed and whether the business rescue resolution was valid; whether the BRPs were independent and competent to manage Glosam's business rescue; and whether Wepex should be placed under business rescue, given its financial position and the diversion of income to GMM.


Financial Distress of Glosam: The court found that Glosam was indeed financially distressed, as it could not pay its debts, including a significant tax liability, due to the diversion of income to GMM by Piper and Neethling. The court rejected Piper's argument that Glosam's debts had been extinguished through contrived cession arrangements.


Compliance with Section 129: The court held that Glosam had complied with the procedural requirements for business rescue, and any minor non-compliance did not justify setting aside the resolution. Piper's lack of cooperation with the BRPs further undermined his claims.


Independence and Competence of BRPs: The court found no evidence to support Piper's allegations that the BRPs were part of a conspiracy with Dyason. The BRPs were deemed independent and competent to manage Glosam's business rescue.


Business Rescue Application for Wepex: The court dismissed the application to place Wepex under business rescue, as Wepex was not financially distressed. The mine was generating substantial income, and the issue was the diversion of funds to GMM, which was a matter for contractual or delictual remedies, not business rescue.


Findings: The removal application (to set aside Glosam's business rescue resolution and remove the BRPs) was dismissed. The court found that Glosam was financially distressed, the BRPs were independent and competent, and Piper's claims of a conspiracy were unsubstantiated. The Business Rescue Application (to place Wepex under business rescue) was dismissed. The court found that Wepex was not financially distressed, and the diversion of income to GMM was a separate issue not suitable for business rescue. The court emphasized that Piper's diversion of funds from Glosam to GMM was prima facie unlawful and that the business rescue process was not intended to resolve disputes over control of a profitable company.


Removal Application (Case: 2024-069923): The application was dismissed. Costs were awarded against Piper and Wepex on an attorney-client scale, including the costs of two counsel where employed. Neethling, GMM, and Piper were ordered to pay the BRPs' and Glosam's costs in the Neethling application on an attorney-client scale.


Business Rescue Application (Case: 2024-053300): Neethling and GMM were joined as parties to the application. The application was dismissed with costs on a party-party scale, including the costs of two counsel where employed.

13 January 2025

FISHER J

CONTRACT – Damages – Robbery and exemption clause – Limiting defendant’s liability unless gross negligence or fraud proven – Contract did not explicitly include 24-hour monitoring of server rack – Not part of defendant’s obligations – Control room operator had no reason to suspect robbery based on alarm trigger – Plaintiff failed to prove breach of contract – Defendant’s actions did not constitute gross negligence – Contractual relationship and exemption clause precluded delictual liability.

Facts: Simply Africa Trading (the plaintiff) contracted Securitas Technology (the defendant) to provide remote security monitoring services for its warehouse premises. A robbery occurred, during which a substantial amount of alcohol was stolen. The plaintiff claimed damages, arguing that the defendant failed to monitor a server rack/cabinet on the premises, which it believed was part of the contract. The defendant denied this, stating that the server rack monitoring was for its own benefit, as it housed its equipment. The contract included an exemption clause limiting the defendant’s liability unless gross negligence or fraud was proven. The defendant also filed a counterclaim for contractual damages and the value of its uninsured equipment stolen during the robbery.


Issue: The primary issue was whether the defendant’s contractual obligations included monitoring the server rack and whether its failure to act on the alarm triggered during the robbery constituted a breach of contract or gross negligence. Additionally, the court had to determine if the plaintiff could claim damages under delict (tort) despite the contractual exemption clause.


Discussion: The court analyzed the contract, which primarily provided after-hours perimeter monitoring. During office hours, other security measures, such as on-site guards and panic buttons, were in place. The server rack alarm was operational 24/7, but the defendant argued it was solely for protecting its equipment. The plaintiff contended that the defendant’s failure to respond to the server rack alarm during the robbery constituted a breach of contract. However, the court found that the contract did not explicitly include 24-hour monitoring of the server rack. Even if it did, the defendant’s actions (or lack thereof) did not amount to gross negligence, as the control room operator had no reason to suspect a robbery based on the alarm trigger.


Findings: The court rejected the delictual claim, emphasizing that parties’ contractual agreements should not be undermined by delictual liability unless exceptional circumstances exist. The court found that the plaintiff failed to prove a breach of contract, as the server rack monitoring was not part of the defendant’s obligations. Additionally, the defendant’s actions did not constitute gross negligence. The delictual claim was also dismissed, as the contractual relationship and exemption clause precluded such liability.


Order: Judgment was entered in favour of the defendant regarding the plaintiff’s claim. The plaintiff was held liable for the defendant’s counterclaim, with damages to be quantified. The plaintiff was ordered to pay the costs of the action and counterclaim, taxed on scale C.

5 November 2024

GORDON-TURNER AJ

COSTS – Unnecessary application – Impounded taxis – Substantive relief sought had become moot – Argument that litigation had prompted release of vehicles – Applicant's members had alternative remedies which they failed to utilize – Could have resolved matter through lower courts or by engaging with relevant authorities – Impoundments were justified – Applicant's case was ill-considered and unnecessary – Vehicles were released independently of litigation – Application dismissed.

Facts: The George branch of the Cape Organisation for the Democratic Taxi Association (CODETA George) brought an application on behalf of its members whose vehicles were seized by the George Municipality between December 2021 and August 2023. The vehicles were impounded due to violations of a court interdict prohibiting unlicensed taxi operations. The applicant sought declaratory relief, the return of the vehicles, and costs. However, by the time of the hearing, most vehicles had been released, rendering the substantive relief moot. The applicant persisted solely to recover costs, arguing that the litigation had prompted the release of the vehicles.


Issue: The primary issue was whether the applicant was entitled to recover costs, given that the substantive relief sought had become moot. The court also had to determine whether the respondents' conduct in retaining the vehicles was lawful and whether the applicant had pursued appropriate remedies.


Discussion: The court noted that the applicant's members had alternative remedies, such as paying impoundment fines or applying for information under the Promotion of Access to Information Act 2 of 2000 (PAIA), which they failed to utilize. The court emphasized that the litigation was unnecessary, as the applicant could have resolved the matter through lower courts or by engaging with the relevant authorities. The court also rejected the applicant's argument that the continuous retention of vehicles was retaliatory or unlawful, finding that the impoundments were justified under the Criminal Procedure Act (CPA) and the National Land Transport Act (NLTA). The applicant’s persistence with the application was a breach of the duty upon the legal representatives to contribute to the efficient use of judicial resources by making sensible proposals so that the court’s intervention was not needed. The matter did not engage constitutional issues for the court’s decision. An issue does not become a constitutional matter merely because an applicant calls it one.


Findings: The court found that the applicant's case was ill-considered and unnecessary, as the vehicles were released independently of the litigation. The court also found that the applicant had failed to exhaust alternative remedies and had not provided sufficient evidence to support its claims. The court concluded that the applicant's persistence with the application, despite the mootness of the substantive relief, was an inefficient use of judicial resources. The applicant’s insistence upon and persistence in using the resources of court merited the court’s disapprobation with a punitive costs order.


Order: The court dismissed the application and ordered the applicant to pay the costs of the first, second, third, fourth, and fifth respondents on an attorney and client scale, including costs related to postponements and reserved costs. The court imposed a punitive costs order due to the applicant's unreasonable conduct in pursuing the litigation.

17 October 2024

MYBURGH AJ

LABOUR – Restraint – Protectable interest – Whether restraint of trade clause was enforceable – Businesses were similar but not direct competitors – Competition was minimal – New role did not involve competing with applicant – Failed to provide sufficient evidence of confidential information or trade connections that employee could exploit – Failed to establish a protectable interest to justify enforcing restraint – Limited competition meant restraint was unreasonable – Application dismissed.

Facts: Roha SA Ingredients (Roha) sought to enforce a restraint of trade clause against its former employee, Gerhardt (first respondent), who resigned and joined Nicola-J Flavours and Fragrances (Nicola-J) as a sales manager. Roha operates in the food colourants market, while Nicola-J primarily deals in food flavours and fragrances, with a minor colourant component. Gerhardt’s role at Roha involved sales in Sub-Saharan Africa, particularly Zambia and Zimbabwe, while his new role at Nicola-J is focused on South Africa. Roha argued that Gerhardt’s employment with Nicola-J breached the restraint clause, which prohibited him from engaging in any business competing with Roha in the food colourants market for one year after termination.


Issue: The central issue was whether the restraint of trade clause in Gerhardt’s employment contract with Roha was enforceable, given his new employment with Nicola-J, and whether Roha had a protectable interest to justify the restraint.


Discussion: The court applied the principles of restraint of trade, emphasizing that such clauses are enforceable unless unreasonable. Roha had to prove the existence of a protectable interest, such as confidential information or trade connections, and that Gerhardt’s new employment threatened this interest. Gerhardt argued that Roha and Nicola-J were not direct competitors, as Nicola-J’s focus was on flavours, not colourants, and that he had no access to confidential information or trade connections that could harm Roha. The court found that while there was some overlap in the colourant market, the competition was minimal, and Gerhardt’s new role did not involve competing with Roha. Additionally, Roha failed to provide sufficient evidence of confidential information or trade connections that Gerhardt could exploit.


Findings: The court held that Roha did not establish a protectable interest to justify enforcing the restraint. The limited competition between Roha and Nicola-J, coupled with Gerhardt’s role in a different market (flavours), meant the restraint was unreasonable. The qualitative and quantitative weigh-off favored Gerhardt, as the potential harm to Roha was minimal compared to the significant impact on Gerhardt’s ability to work in his chosen field.


Order: The application was dismissed. Gerhardt was ordered not to solicit any of Roha’s clients during the restraint period, and Roha was ordered to pay the costs of the application.

3 September 2024

MAHALELO AJ

LABOUR – Promotion – Police service – Interpretation of uninterrupted service – Requires continuous service without any break – Employee’s resignation and re-employment constituted a break in service – Arbitrator’s interpretation included pre-resignation service – Inconsistent with plain language and purpose of provision – Failed to consider principle of legality – Material error of law – Decision was unreasonable – Reviewed and set aside.

Facts: The case involves the South African Police Service (SAPS) as the applicant, seeking to review and set aside an arbitration award issued by the third respondent, Goldman N.O. The award ruled that Mr. Gibbons, represented by Solidarity (first respondent), was subjected to an unfair labour practice relating to promotion. The arbitrator ordered SAPS to promote Mr. Gibbons to the rank of Captain at Woodstock Police Station by 1 October 2021 and pay him the corresponding salary, including back pay from 1 January 2019. SAPS delayed filing the review application and sought condonation for the late filing, which was granted. The dispute arose because Mr. Gibbons, who had previously resigned and was re-employed, did not meet the requirement of four years of uninterrupted service as a Warrant Officer at the time of his promotion application. Despite being conditionally promoted, his promotion was later revoked due to this lack of uninterrupted service.


Issue: The central issue was whether the arbitrator’s interpretation of "uninterrupted service" in the context of promotion requirements was reasonable. SAPS argued that the arbitrator incorrectly interpreted the term to include periods of service before Mr. Gibbons' resignation, which constituted a break in service. The arbitrator’s decision was based on the finding that Mr. Gibbons had been subjected to an unfair labour practice.


Discussion: The court examined the arbitrator’s interpretation of "uninterrupted service" and whether it aligned with the plain meaning of the term as defined in the SAPS National Instruction and the collective agreement. The court emphasized that the term "uninterrupted service" requires continuous service without any break, and Mr. Gibbons’ resignation and re-employment constituted a break in service. The arbitrator’s interpretation, which included pre-resignation service, was found to be inconsistent with the plain language and purpose of the provision. The court also noted that the arbitrator failed to consider the principle of legality, which obligates SAPS to prevent unlawful appointments.


Findings: The court found that the arbitrator committed a material error of law by misinterpreting the term "uninterrupted service" and failing to give due weight to its plain meaning. The arbitrator’s decision was unreasonable, as it fell outside the band of decisions a reasonable decision-maker could reach based on the material presented. The court concluded that Mr. Gibbons did not meet the minimum requirements for promotion at the time of his application, and the arbitrator’s award was therefore set aside.


Order: The court granted condonation for the late filing of the review application and set aside the arbitrator’s award dated 18 August 2021. No costs were awarded against the first respondent.

28 January 2025

ALLEN-YAMAN J

LABOUR – Strike – Violence – Protected strike – Acts of violent incidents including murders of three individuals – No statutory basis for declaring strike unprotected solely due to violence – Act limits right to strike only through procedural and substantive requirements – Perpetrators of violence not identified – No direct evidence linking unions or striking employees to crimes – Violent incidents did not alter strike’s legal status – Application dismissed – Labour Relations Act 66 of 1995, s 67(1).

Facts: South African Container Depots (Bidvest SACD) applied to the Labour Court on an urgent basis to declare a strike by its employees unprotected. The strike, initiated by NUMSA (third respondent) and joined by RETUSA (fourth respondent), began on 6 January 2025 following a retrenchment process facilitated by the CCMA. The strike was marked by violent incidents, including the murders of three individuals associated with Bidvest SACD and its contractors, as well as an assault on employees. Bidvest SACD sought to interdict the strike, alleging that the violence rendered it unprotected and disrupted its operations. The CCMA issued Picketing Rules during the proceedings, resolving some disputes between the parties.


Issue: The key issue was whether the strike, which was procedurally compliant with the Labour Relations Act 66 of 1995 (LRA), could be declared unprotected due to the violent incidents associated with it. Additionally, the court had to determine whether Bidvest SACD was entitled to interdictory relief against the striking employees and unions.


Discussion: The court analyzed whether the violent acts, including the murders, could strip the strike of its protected status under the LRA. Bidvest SACD argued that the violence undermined the strike’s legitimacy and made it counterproductive to collective bargaining. The court considered previous judgments, including Tsogo Sun Casinos (2012) 33 ILJ 998 (LC) and NUFBWSAW v Universal Product Network (2016) 37 ILJ 476 (LC), which suggested that extreme violence could render a strike unprotected. However, the court found no statutory basis in the LRA for declaring a strike unprotected solely due to violence. The LRA limits the right to strike only through procedural and substantive requirements, none of which relate to violence. The court also noted that the perpetrators of the violence had not been identified, and there was no direct evidence linking the unions or striking employees to the crimes.


Findings: The court held that the strike remained protected under the LRA, as it complied with all statutory requirements. The violent incidents, while egregious, did not alter the strike’s legal status. The court also found that Bidvest SACD failed to establish a direct link between the striking employees and the violence, which was necessary for granting interdictory relief. The application was dismissed, with no order as to costs, as the court found that both parties acted reasonably given the circumstances.


Order: The application was dismissed.

21 January 2025

WOODROW AJ

TAX – Customs and excise – Fuel refund claim – Disallowed rebate claims – Non-compliance with Act – Strict compliance required – Invoices did not comply – Argument of substantial compliance rejected – Logbooks lacked detailed records of diesel usage and specific purposes of use – Storage logbooks did not provide sufficient details on how diesel was dispersed or used – Failed to prove that all diesel was used for eligible primary production activities – Appeal dismissed – Customs and Excise Act 91 of 1964, ss 75(1A) and (4A).

Facts: Sandbaken Boerdery, a mixed farming operation in Mpumalanga, claimed diesel rebates under section 75(1A) of the Customs and Excise Act, 1964, for diesel used in its farming activities. The South African Revenue Service (SARS) disallowed rebate claims totalling R711,223.08 for the period December 2018 to October 2020, citing non-compliance with the Customs Act, particularly regarding invalid invoices, inadequate logbooks, and insufficient supporting documentation. Sandbaken appealed the decision, seeking to set aside the determination and recover the disallowed rebates.


Issue: The court had to determine whether the invoices provided by Sandbaken complied with Part 3 of Schedule 6 of the Customs Act 91 of 1964; whether Sandbaken’s logbooks for diesel usage complied with the Act; whether Sandbaken’s diesel storage records complied with the Act; and whether the diesel was used for primary production activities in farming.


Discussion: The court analyzed the requirements under the Customs Act, particularly section 75(1A) and Note 6 of Schedule 6, which govern diesel rebates. The court emphasized that strict compliance with the Act is required, as rebates are a privilege, not a right. The court examined Sandbaken’s compliance with the requirements for valid invoices, logbooks, and storage records, as well as whether the diesel was used for eligible farming activities.


Findings: Invoices: The court found that the invoices did not comply with Note 6(d)(cc) of Schedule 6, as they were addressed to PJ Cronje en Seuns instead of Sandbaken. The court rejected Sandbaken’s argument of substantial compliance, holding that strict compliance is required.


Logbooks: The court found that Sandbaken’s logbooks did not meet the requirements of Note 6(a)(xi). The logbooks lacked detailed records of diesel usage, including odometer readings, distances traveled, and specific purposes of use. The court also noted discrepancies between the handwritten logbooks and the reconstructed Excel logbooks.


Storage Records: The court found that the storage logbooks did not provide sufficient details on how the diesel was dispersed or used, failing to comply with Note 6.


Primary Production Activities: The court found that Sandbaken failed to prove that all diesel was used for eligible primary production activities, as required by Note 6(h). The descriptors in the logbooks were too generic, and some activities listed were ineligible for rebates.


Order: The court dismissed Sandbaken’s appeal, finding that it had not met the onus of proving compliance with the Customs Act. The court ordered Sandbaken to pay the costs of the application, excluding costs related to an irrelevant budget speech document attached by SARS.

© 2025 SPARTAN CASE LAW (PTY) LTD – ALL RIGHTS RESERVED

Spartan Caselaw provides the best tools for litigation with daily reporting and an extensive case law collection.
bottom of page