Commercial Law Index

This issue was whether the Minister of Finance (applicant) has powers to intervene where the respondent's (Oak Bay Investments) bank accounts were being closed. In deciding the case, the court employed the Superior Court Act 10 of 2013 (the act) which empowers the court to enquire into and determine any rights and obligation a person can claim. 

The court held that the enquiry envisaged by s21(c) of the act encompasses a two-legged enquiry. The court must be satisfied that the applicant is a person interested in an existing, future or contingent right and whether the case is a proper one in which to exercise its jurisdiction.

The court ruled that there is no statute that empowers a minister to intervene in a private bank client dispute. Banks can terminate a relationship with a client at their own discretion. It observed that there was no uncertainty in regard to the relief sought by the applicant as there was a court precedent relating to relief being sought.  The court held that the Minister of Finance through his counsel knew very well that he has no power to intervene. The court ruled that it is not obliged to grant the order sought by the minister because there was no uncertainty in regard to the legal question. It ruled further that to allow the relief sought would breach the principal of separation of powers as it will amount to judiciary to stray into domain of the executive.

The applicants sought an interim interdict against the respondent bank, with which they had a bank-client relationship, to restrain it from terminating the operations of the applicants’ banking facilities.

The court considered whether courts could direct the respondent to continue its operations in the country against its will. The court held that the respondent’s decision to exit the country’s banking sector is one that the courts cannot interfere with.

The court relied on the respondent’s constitutional right to trade, which also entails the election of not utilising such right. The court remarked that the respondent’s decision to cease operations in the country rested on commercial considerations which were highlighted in para 15 of the judgement.

The respondents right to or not trade supersedes any right the applicant may have, thus the application was dismissed with costs.

The applicants sought an order declaring that the respondent’s premature removal of an advertisement from a billboard under the latter’s control was unlawful and unconstitutional. The advertisement concerned Israel’s occupation of Palestine depicted by contrasting maps.

The applicants contested the removal on several grounds, including freedom of expression, which is entrenched by section 16 of the Constitution of the Republic of South Africa. Because respondent was not a state entity, this raised questions of when s 16 may be horizontally applied.

The respondent substantiated its conduct in terms of its agreement with the second applicant, arguing it was permissible due to the advertisement’s alleged contravention of the City’s advertising by-laws, the Practice Code of the Advertising Standards Authority, as well as its own internal policies.

The court found no legitimate basis in the parties’ agreement, on these facts, for the respondent’s removal of the advertisement prior to the stipulated flighting period. As a private body, the respondent was not positively burdened with respecting, promoting and upholding the applicants’ right to freedom of expression. However, it still faced a negative duty not to interfere with it.

The court granted the application and directed the respondent to reinstate the advertisement, subject to practical qualifications. A portion of 9(h) of the Outdoor Advertising By-Laws of the City of Johannesburg was held to be invalid for exceeding the constitutional limitations of free speech.

This case dealt with emolument attachment orders (EAO) that had been obtained through written consent by the applicants. The applicants were a group of low-income earners and vulnerable occupants that only had their salaries and wages as a means to survival. The issue was that the EAOs were from jurisdictions far from where the applicants resided. This case pinpoints the importance of issuing EAOs that are just and equitable, by focusing on the processes that the respondents had followed to secure repayment of loans. This case also illustrates the duty to protect citizens against human rights abuses by business enterprises by having effective remedies that protect victims.

The court considered whether the respondents’ conduct fell within the scope of section 65J(1)(a) of the Magistrates’ Court Act which allows an attachment on a debtor’s earnings and obliges his or her employer to pay out of such earnings specific instalments in favour of the creditor. The court held that section 45 of the Magistrates’ Court Act provides that parties may consent to the jurisdiction of a court that does not have jurisdiction

The Court held that section 65(J)(1)(a) of the Magistrates’ Court Act had failed to provide a statutory limit on the EAOs which may be granted against a judgment debtor.

The Court found that the respondents had denied the applicants their constitutional right to approach the courts by obtaining judgments and EAOs in courts that were far from the applicants’ workplaces and homes. The court held that the respondents’ actions were a result of them forum shopping for courts which entertained their applications. The court held that in this case where the applicants had admitted liability for the debts and had consented to the EAOs, section 45 of the Magistrates’ Court Act did not permit that the applicants could consent to the jurisdiction of a court outside their district. Thus, the court found that the EAOs were in fact not just and equitable considering the statuses of the applicants.

Accordingly, the court upheld the applicants’ complaint and held that the EAOs were in breach of section 65(J)(1)(a) of the Magistrates’ Court Act.

The issue was whether a donation of an interest in a close corporation to the third respondent by the deceased could be declared unlawful and void for lack of consent in terms of s 15(2) and (3) of the Matrimonial Property Act (MPA). Further, if failure to set aside the donation timeously amounted to ratification in terms of s 15(4) of the MPA.

The court held in terms of s 15(4) that consent may be given by way of ratification within a reasonable time. If there was a lack of consent when entering into the transaction, the question is whether objectively, the benefiting party could have reasonably known that consent was required.

The court found that failure of the applicant to institute proceedings timeously does not support the conclusion that it was ratification in terms of s 15(4). The court also found that the conclusion of the transaction lacked the required consent. In that light, objectively, it was not incumbent for the third respondent to investigate the legal character of the deceased's first marriage before she accepted the donation. Therefore, deemed that there was consent in terms of s 15(3).

The court accordingly dismissed the application

The appellant had decided not to claim two previous accidents because he did not want to lose his no-claim bonus. This case highlights the effects of an “OUT bonus” clause within an insurance policy that positively discourages clients from submitting claims.

The court considered whether the appellant’s failure to disclose the two previous incidents in which the vehicle was damaged within 30 days, allowed the respondent to avoid liability in terms of the contract. The court had to decide whether the appellant’s inaction amounted to a breach of the insurance policy, which had stated in plain language that one is rewarded for not claiming.

The court held that the insurer’s policy created a self-absorption of any damage caused by the insured, whereby, the insured was to be paid 10% of their premiums after the first three years of the policy. The court held that this formed the basis of the appellant’s decision to not disclose his claims.

The court was not satisfied that the appellant’s failure to disclose the two previous incidents within 30 days amounted to a rejection of the claim. The court held that the obligation to report “incidents” created uncertainty, especially in situations whereby the insured had no intention of lodging a claim. In this case, it was evident that the appellant’s decision not to claim was a result of the attraction of the OUT bonus.

Thus, the court upheld the appellant’s claim and held that the defendant was liable to compensate the appellant.

In this case, the appellant appealed the decision of the lower court to strike out the appeal against the trial court’s interlocutory decision for being incompetent. This case illustrates how final and interlocutory orders are distinguished.

The court considered whether the Court of Appeal was right to hold that the appeal from the High Court on the issue of jurisdiction was interlocutory for which an appeal must be lodged within 14 days.

The court was called upon to determine whether or not a court’s decision is final in the course of determining the appeal. The court held that a final order at law was one which brings to an end the rights of the parties in the action. On the other hand, an interlocutory order was only intermediate and did not finally determine the rights of the parties in the action. The court held that this case was an interlocutory motion and the order that had been granted by the trial court was a final order. Therefore, an appeal on the order of the trial court was a right under section 220(1) of the Constitution.

The court also referred to Alor v. Ngene (2007) 17 NWLR (Pt 1062) 163 which provided that where a decision of a court finally and completely determined the rights of the parties, it was final, but if did not then it was only interlocutory. Thus, the court concluded that the trial court’s decision was interlocutory and could not be said to be perverse.

The court dismissed the application with parties bearing their own costs. 
 

The applicant brought a complaint against the defendants for contravening the market allocation prohibition of the Competition Act (the act) by entering into an ongoing agreement allocating market territory for the sale of locking products in both the Free State and Northern Cape. They sought to have the defendant’s conduct declared in contravention and consequently interdicted and charged with a 10% turnover administrative charge in respect of the contravention.

The first issue was whether the commission could allege market allocation for all products. Looking at the legislative powers of the commission, the Competition Tribunal reasoned that since the agreement’s subject matter covered all products the commission had authority therein.

The tribunal then considered whether the agreement was still ongoing after the coming into effect of the act and s 4(1)(b)(ii). It assessed the evidence and established that the defendants had not competed with each other since the entry into agreement until the time in issue and thus the agreement remained ongoing. 

The final issue was whether the agreement’s rationale was in contravention of the section above. By looking at the ratio in American Soda Ash Corporation and Another vs. Competition Commission and Others [2005] 1 CPLR 1 (SCA) and The Competition-Commission and Pioneer Foods (Pty) Ltd, Case No: 15/CR/Feb07, the tribunal highlighted that s 4(1)(b)(ii)’s market allocation prohibition is a per se prohibition and thus there can be no justification for the conduct.

The agreement was held to be ongoing and in contravention of s 4(1)(b)(ii).

This case developed common law to hold an employer liable where one of its employees is sexually harassed by a senior employee.

The court considered the employer’s liability in tort for sexual harassment of its junior employee by a senior employee. The court held that the first and second respondent were jointly and severally liable for the damages suffered by the plaintiff as a result of sexual assault perpetrated against her.

The court applied the rule that an employer is vicariously liable for the actions of its employee when an unlawful act is connected to the conduct authorised by the employer. The court held that the first respondent placed the second respondent in a senior position of trust and thus had the responsibility of ensuring that the second respondent was capable of that trust. This trust created the causal link between the second respondent and the wrongful act and that the employment relationship facilitated the sexual harassment.

The court also found the first respondent liable for imposing a two-week suspension as opposed to dismissing the second respondent for sexual harassment of a younger subordinate.

Accordingly, the court granted the application for damages in the sum of R4 million jointly and severally from the first and second defendant.

In this case, the appellant protested the total absence of any service of the processes and claimed ignorance of the proceedings at the lower court. This case illustrates the essentiality of service of court process.

The court considered whether the appellant had been duly served with the notice of appeal, other processes filed by the respondent at the lower court and also the hearing notices. 

The court followed the principle provided in Ihedioha v Okorocha Appeal No. SC. 660/2015 (unreported, delivered on 29 October 2015) where it was held that service is an important aspect of judicial process. It was held that failure to serve a named party with court process offends section 36(1) of the Constitution. 

The court also took into account the provision of order 2 rule 6 of the Court of Appeal Rules, which stipulates that it is mandatory for the service of the notice of appeal on a respondent to be personal.

The court held that the validity of the originating processes in a proceeding before a court was fundamental because the competence of the proceeding is a condition sine qua non (an essential condition) to the legitimacy of any suit. The court held that there was a lack of certainty that the appellant was served with any process in accordance with practice and procedure of the rules of court.

The court upheld the appeal with no costs.
 

This was an application to compel the Competition Commission of South Africa to produce a record of investigation.

The issue emanated from an investigation by the respondent on banks on allegation of collusive conduct in regard to trade in foreign currency.  The applicant was one of the banks investigated. The applicant requested without success on several times for the record of investigation from the respondent. It then made an application to compel the respondent to provide the record.

The respondent opposed the application arguing that the applicant should have proceeded by way of review under Promotion of Administrative Justice Act (PAJA) because its action amounted to an administrative act. The applicant on the other hand argued that the commission’s conduct did not constitute administrative action and the tribunal should consider the application.

In deciding the matter, the Competition Tribunal held that the respondent action did not qualify as administrative action because it does not meet the requirement of finality. However, it found that the Competition Commission cannot be compelled to provide the requested record because of the complex nature of the process. It ruled that the respondent should provide the requested record during discovery.

The matter involved an application for extension of time of appeal against a lower court decision granted against the applicant. 

The main issue was whether the applicant had shown cause to justify the granting of the extension. The court noted that the length of the duration of the delay in bringing an application for extension is immaterial provided there are good reasons to justify it. In its engagement with the law, the court emphasised the role of judicial discretion in assessing the efficacy of granting the extension. It stated that for this discretion to be exercised the applicant had to show good and substantial reasons for failure to initially make the appeal. These could be a rule, lack of means, mistake or accident. The other inseparable twin leg was for the applicant to show prima facie good cause why the appeal should be heard.

In assessing whether the contemplation of an out of court settlement as reason for delay was a substantial enough reason, the court cited the Supreme Court judgment of Ikenta Best Ltd v AG Rivers State (2008) 2 SCNJ 152 to establish that the reason would not meet muster. The court thus concluded that the application did not meet the first condition for granting an extension and therefore dismissed the application for lacking merit.
 

The matter arose from a decision on a dispute about traditional ownership of land between the appellant or the respondent’s family in favour of the respondents. 

As the trial court had found in favour of the respondent, the key question was whether the trial court was correct in its findings. The court first noted the trial court’s failure to fully address all issues necessary for determining a declaration of title before making a comment on the judgment’s failure to appraise and evaluate the evidence presented to it. It asserted that it is a legal requirement for a court to consider and determine all issues brought before it otherwise the judgment would be flawed and could amount to a miscarriage of justice and breach of fair hearing. The court thus reasoned that the total dearth of findings on any of the substantial issues of facts and law by the trial court rendered its judgment a nullity. Hence the trial court’s judgment was incorrect.

Further, the court decried the trial court’s failure to deal with salient issues that included evidence of traditional history, inheritance and length of possession as an abdication of its duties. On whether the court could remedy this, it noted that since these depended heavily on credibility of witnesses, would be handicapped to make findings to resolve the dispute. The court thus set aside the judgment of the trial court and remitted the matter to the High Court for de novo hearing.