TODAY'S ALERTS

Facts and issue: The municipality respondent, needing security services in four different clusters under its jurisdiction, put a tender inviting security service providers to submit bids in competition thereto. Bidders could bid for some or all the clusters. Four different entities, one per cluster, were recommended as the successful bidders by both the Bid Evaluation Committee and the Bid Adjudication Committee. The acting municipal manager overturned the recommendations or deviated therefrom, deciding to appoint Tubatse Security Services in all four clusters. The applicant seeks to review and set that decision aside.

Discussion: The empowering provision is Security Tender Terms of Reference. Both the Bid Evaluation and Bid Adjudication Committees understood the empowering provision to mean that although the bidders could bid for all four clusters, no bidder could be awarded more than one cluster. That is also the understanding of the applicant. The emphasis of the word “four” twice in paragraph 6.2 of the empowering provision means exactly what it ordinarily means; four preferred bidders one per cluster. One bidder chosen four times can, assuming the Bantu Education arithmetic we learned is still correct, never be said to amount to four service providers. One entity does not become four when referred to four times. It remains one. Paragraph 6.3 of the empowering provision only serves to further emphasize the point of four preferred service providers one per each cluster when it enlightens the bidders that they can take their chances in all four within an understanding that they, if successful, can only be appointed in one.

Findings: The decision of the acting municipal manager contravened the empowering provision and should on that ground alone be reviewed and set aside. There are no provisions which authorized the acting municipal manager to deviate from the recommendations of the Bid Adjudication Committee as he did. The decision to deviate from the recommendations of the Bid Adjudication Committee was not authorized by the empowering provision and is judicially reviewable and must be set aside.

Order: The application succeeds only to the extent of setting aside the award of the tender to the third respondent. The decision is declared invalid, unlawful and is reviewed and set aside.

Facts and issue: The applicant obtained default judgment against the respondents and the property in question was declared specially executable. The applicant proceeded with a sale in execution of the property and apparently no persons showed interest at the sale in execution. As such, the sale in execution did not realize. The applicant approaches the court seeking a reconsideration of the reserve price, that it be removed for the property to be sold and to realise its security.

Discussion: The application is opposed by the respondents. They contend that the applicants did not follow the provisions of Rule 46(9)(c), (d), and (e) of the Uniform Rules of Court and, hence, a court does not have sufficient information at its disposal for a reconsideration of setting aside the reserve price. Rule 46A is designed to protect homeowners from their homes being sold for far less than it is worth. The sole purpose of judicial oversight in all cases of execution against immovable property is to ensure that the orders being granted did not violate section 26(1) of the Constitution where the judgment debtor is likely to be left homeless because of the execution. Therefore, when an application is brought for reconsideration of the sale of a property by way of a sale in execution without a reserve price, a court, in considering such application, must tread carefully and by way of applicable procedure as set out in Rule 46A, more especially 46A(9)(c), (d) and (e).

Findings: The report or return of service from the sheriff is not comprehensive and does not set out the full details as required by the Rules. Setting aside the reserve price could only result in a situation where the respondent will be left homeless and still be liable for the shortfall on the mortgage debt if sold at a very low price. Therefore, this could result in an abuse of process.

Order: The application is dismissed with costs.

Facts and issue: The appellant instituted an application against the respondent, the Companies and Intellectual Property Commission (CIPC), for the reregistration of a close corporation of which he is the sole member. The relief which he sought was, to declare the dissolution of the close corporation to be void; an order directing that the respondent restore the close corporation’s name to the register of companies and thirdly an order declaring that the assets of the corporation to be no longer bona vacantia and revested in the close corporation. The application was dismissed by the court a quo. This is an appeal against that decision.

Discussion: The appeal falls to be decided on two issues. The first is whether the non-joinder of the Minister of Finance and the Department of Public Works is fatal to the case of the appellant. The second is, whether the court a quo was correct in dismissing the application because it found that it did not have the necessary jurisdiction to hear the application in the court. Whilst the court agrees with the sentiments expressed by the appellant’s counsel that the new Act brought about a change in the legislative scheme of our corporate law at variance with the 1973 Act, it did not usher in a change concerning the property or assets of the deregistered company or close corporation being automatically declared bona vacantia, thereby attracting the interest of National Treasury as a party with a direct ad substantial interest.

Findings: The non-joinder of the Minister of Finance and the Treasury is an essential requirement and such non joinder was fatal to the appellant’s case. Especially in the light of the admission by the appellant that the assets in the form of the claim against the firm of attorneys and the claim in the insolvent estate of Machin became bona vacantia. Absent that, the court is unable to find that the relief the applicant sought in the court a quo in terms of section 83(4) of the new Act should have been granted. The court a quo had misdirected itself in finding that it did not have the necessary jurisdiction to adjudicate the matter.

Order: The appeal, insofar as the ground of appeal that challenges the court a quo’s finding on lack of jurisdiction, succeeds. The appellant is granted leave to serve the papers on the Minister of Finance within 21 days of the order.

Facts and issue: The accused was charged in the magistrate’s court of assault with the intent to do grievous bodily harm, read with the provisions of section 51(2)(b) and Part 3 of Schedule 2, as amended, of Act 105 of 1997, which provides for the imposition of certain minimum sentences for certain offences. The accused was therefore eligible to be sentenced to ten years imprisonment in the absence of a finding of compelling reasons justifying departure from the mandatory sentencing regime. The ordinary penal jurisdiction of a district magistrate’s court is a maximum of three years imprisonment. This is a special review referred to the court by the regional magistrate of Welkom in terms of Section 304 of the Criminal Procedure Act.

Discussion: After hearing the evidence presented by the prosecution and the accused, the presiding magistrate found the accused guilty on both counts. The magistrate thereafter heard submissions relating to mitigating and aggravating circumstances but instead of sentencing the accused, she referred the matter to the regional court for sentencing in terms of the provisions of section 116(1) of the CPA. This was done because she held the view that the offences merited punishment in excess of the jurisdiction of a magistrate’s court. In respect of the jurisdictional competence of the magistrate’s court to hear the matter in question, the regional court magistrate referred to the wording of section 51(2)(b) of Act 105 of 1997, which provides that a regional court or a high court shall sentence a person convicted of an offence referred to in Part 3 of Schedule 2 to certain periods of imprisonment depending on whether he is a first, second or third offender of such offence.

Findings: The question is therefore whether only a regional court or a high court has the competence to hear cases which carry minimum sentences after a potential conviction. The court is of the view that such a proposition cannot be correct, because the section in question only refers to the imposition of sentences, and not to the hearing of cases on their merits. The conviction of the accused and his referral to the regional court for sentence must stand.

Order: The conviction of the accused in the district magistrate’s court is confirmed. The regional court must proceed to finalize the matter in an unrestricted manner.

Facts and issue: Application in terms of Rule 43(6) in which the applicant seeks an order varying the original Rule 43 order granted. The applicant contends that by virtue of the shared residence regime, the respondent’s costs for the children have reduced and he no longer wishes to pay maintenance to the respondent but, rather to pay directly to the third-party creditors namely the children’s respective schools and the medical aid scheme. He considers the change in residence to comprise a material change in circumstances as contemplated in Rule 43(6).

Discussion: The respondent raises two issues of concern to the court. The first is that the applicant has not complied with the initial Rule 43 court order because of which the respondent was constrained to obtain a garnishee order against the applicant’s salary. Secondly, the applicant has failed to disclose whether he receives an annual bonus, he has undervalued his pension interest by almost a million rand and mis-stated his monthly expenses. It appears that the respondent makes payment of all the children’s expenses. The respondent also makes payment of the holding costs of the former matrimonial home where she resides. The respondent contends that the applicant removed the children from his medical aid and advised her to place them on her medical aid as dependents which she did. The respondent also indicates that the children’s school fees have increased annually and that the children’s medical excess expenses are vast.

Findings: In circumstances where the applicant is prone to conducting himself in default of court orders and reporting professionals or organizations to their professional bodies when he is dissatisfied, the court is concerned that he will not pay third party service providers of the children if they displease him, which would naturally compromise the interests of the children. The applicant’s alleged monthly shortfall is far less than what is contended for by him. The changed circumstances advanced by the applicant do not warrant a change in the order.

Order: The parenting plan is made an order of court. The applicant shall make payment of the sum of R20,000 per month. The remaining relief sought by the applicant is dismissed.

Facts and issue: Application in terms of Uniform Rule of Court 42(1) (a) and (c) for the recission of an order granted by the court. The order provided that the marriage between the parties is dissolved and that the deed of settlement is made an order of court. The applicant seeks that the order granted be rescinded on the basis of a failure on the part of the respondent to disclose to the court granting the decree of divorce that a customary marriage had been concluded between the parties.

Discussion: The crux of the applicant’s grievance is the fact that the respondent failed to disclose to the court that he was already customarily married to the applicant. The applicant does not seek a recission of the order in terms of the common law nor does she allege mistake, fraud, duress, undue influence or any other valid ground for setting aside the agreement. The high-water mark of her case is that she had been admitted to hospital and diagnosed with depression, the respondent insisted that she attend with him at his lawyers where she was presented with documents to sign. She later learned that this was the settlement agreement. She does not contend that she did not read the document. Had the applicant made out a case for the setting aside of the agreement on the bases set out above, such a case could have been considered. But the applicant did not do so. She brought an application in terms of Rule 42, contending that the First Respondent misrepresented to the court that the parties were married out of community of property with the accrual system, when, according to her, the parties were actually married in community of property.

Findings: It is common cause that the parties both signed the agreement of settlement. The only basis upon which a compromise may be set aside is if it was obtained fraudulently or on the grounds of mistake, provided that the error vitiated true consent and did not merely relate to the motive of the parties or the merits of the dispute, which was the purpose of the parties’ compromise. Even if the settlement agreement were not made an order of court and even if the decree of divorce were to be revoked and the parties were to be married again, it would still not release the applicant from the fact that an agreement of settlement had been concluded.

Order: The application is dismissed with costs.

Facts and issue: The applicant obtained a default judgment against the respondents in an amount of R11,652.95. The causa was unpaid levies. The applicant obtained an order provisionally sequestrating the respondents’ joint estate. The applicant seeks the confirmation of the rule nisi and a final sequestration order. The Sheriff served the warrant of execution on the respondents by affixing it to the principal door.

Discussion: The failure to serve a warrant of execution on a debtor at his residence does not affect the validity of the execution of a warrant. Nor does the failure to serve a warrant of execution on a judgement debtor personally. Regarding solvency, the respondents do not dispute that a bond is registered over the Unit in favour of Nedbank. They aver that they have been paying the monthly instalment on the bond. As far as assets are concerned, the respondents have not disclosed the value of the motor vehicles, nor whether they are subject to a credit agreement. They have also not produced a valuation of the household furniture and appliances. What ultimately weighs in favour of the respondents is that cash totalling R276,134.94 stands to the credit of the respondents in two bank accounts held at Standard Bank. The applicant has demonstrated that the respondents have committed an act of insolvency.

Findings: The applicant has not succeeded in establishing that the respondents are insolvent. The applicant’s case is that it can be inferred from the respondents’ failure to satisfy the judgment debt and pay levies to the body corporate that they are insolvent. However, the respondents have been paying creditors, albeit that they were not paying the levies as they fell due. The respondents are not impecunious. This is not a case of a debtor who is unable to pay his debts. The payment of R40,000 is in itself an indication that the respondents can pay their debts. Moreover, they are servicing the bond to Nedbank monthly.

Order: The rule nisi is extended.

Facts and issue: This is an application brought to review and set aside an arbitration award. Complicating the matter is the fact that the record was served outside the prescribed 60-day period. The respondent was a permanent employee of the applicant. Having acted as the Senior Manager: Research on occasion he applied for the position when same was advertised. Despite not having the required PHD degree he was successful in his application and appointed. The respondents employment was terminated shortly after. The commissioner found that there had been a dismissal and that same was unfair and ordered that the applicant reinstate the respondent.

Discussion: The applicant brought the application in time but failed to file the record in terms of Rule 7A(6) of the Labour Court Rules within the required 60 day period. The application is accordingly deemed to be withdrawn in terms of the Practice Manual applicable at the time. The applicant has sought to revive the application. The applicant declined to follow the avenues open to it in terms of the Practice Manual. No explanation is tendered as to why the Practice Manual was not followed. There was no request, even belatedly, for an indulgence. There is no detailed explanation for the period between 22 February 2022 and 24 May 2022. This is required in a condonation application and more so in a reinstatement application where the failure to comply with the Practice Manual must also be explained.

Findings: The submissions on prospects of success are lacking. The facts as stated do not set the basis for any reasonable prospect of success. No explanation is tendered as to why the provisions of clause 11.2 were not invoked when it was apparent that the record could not be filed in time. The full record has not been filed. There is basis for the applicant to suggest that the respondent was dismissed in terms of the High Court Order.

Order: The application to reinstate the review application is dismissed. The review application is deemed withdrawn and accordingly the Orders granted in the Arbitration Award are immediately enforceable.

Facts and issue: Review application against the arbitration award issued by the commissioner. The award declared the dismissal of the employee to be substantively unfair and ordered the company to reinstate the employee retrospectively with full backpay. The employee raised preliminary points. First, he challenged the authority of the deponent to the founding affidavit to institute these review proceedings (authority). Second, he challenged the locus standi of the deponent to the affidavit (locus standi).

Discussion: The founding affidavit was deposed to by the Acting Group Chief Executive Officer (AGCEO) of the company, Moholo. The employee disputed the authority of Moholo to institute these proceedings. Moholo describes the company as “North-West Transport Investment (SOC) Ltd” and sets out its principal place of business. No further details are provided. Moholo does not make any averments that he is authorised to institute the application. He insists that he is authorised to depose to the affidavit and clearly conflated the authority to institute the proceedings with the authority to depose to the affidavit. For this enquiry, it is irrelevant that Moholo had the authority to depose to the affidavit. What is relevant is that it is the institution of the proceedings and the prosecution thereof that must be authorised.

Findings: The answering affidavit was served more than 25 months ago. Moholo had ample time to satisfy the court that he was authorised to institute the proceedings. The onus was on him to show that the review application was authorised by the Board. He ignored and/or misapprehended the employee’s point. The result is that the point remains unanswered. The inevitable conclusion is that there is no application that has been authorised by the company. The employee’s point in limine must succeed.

Order: The application is dismissed.

Facts and issue: The applicant, Carrick, is a wealth management company. The respondents (Mr. Janse van Rensberg, Mr. Gombera, Mr. Okafor and Mr. Jossel) are Carrick’s former employees. They have incorporated Arck Wealth, which is also a wealth management company, and which Carrick complains is trading on confidential information obtained when the former employees were in its employ. Carrick also complains that Arck Wealth is in the process of luring Carrick’s clients away from it. Carrick says that all of this is in breach of confidentiality undertakings and restraints of trade entered by each of its former employees.

Discussion: The restraints of trade applicable to Mr. Janse van Rensberg, Mr. Gombera and Mr. Okafor are still in force. The restraint applicable to Mr. Jossel has expired, but Carrick points out that Mr. Jossel’s duty to keep information subject to the confidentiality undertakings secret is not time-bound. Carrick says that Mr. Jossel’s use of the confidential information through Arck Wealth with three other people who are still subject to restraint is a classic example of spring-boarding: the unlawful use of confidential information to acquire an unfair competitive advantage. On the undisputed facts, Carrick has at the very least a reasonable apprehension that the restraints of trade and the confidentiality undertakings will be breached in future, notwithstanding the former employees’ averments in the answering affidavit.

Findings: Carrick is entitled to an order enforcing the employees’ contractual obligations. Carrick seeks only to restrain Mr. Okafor from poaching its existing clients for a year after his employment with it ends. In the cases of Mr. Janse van Rensberg and Mr. Gombera, Carrick also asserts the right to extend that restraint for a further year, since each of these individuals signed an exit agreement extending the restraint to two years in return for an additional payment. The restraints seem to be perfectly reasonable and enforceable. Carrick has a protectable interest in keeping the information confidential. The restraints and the confidentiality undertakings are accordingly enforceable.

Order: The applicant’s application succeeds.