Case Law[2022] ZAGPJHC 1037South Africa
Costa v Korte and Another In re: Korte and Another v Mitrewood Products CC and Others (19524/2019) [2022] ZAGPJHC 1037 (16 December 2022)
High Court of South Africa (Gauteng Division, Johannesburg)
16 December 2022
Headnotes
Summary: Application for contempt of the court order following the interdict against the first respondent’s spoliation. The applicant and the second respondent complaining that first respondent failed to comply with the court order.
Judgment
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# South Africa: South Gauteng High Court, Johannesburg
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## Costa v Korte and Another In re: Korte and Another v Mitrewood Products CC and Others (19524/2019) [2022] ZAGPJHC 1037 (16 December 2022)
Costa v Korte and Another In re: Korte and Another v Mitrewood Products CC and Others (19524/2019) [2022] ZAGPJHC 1037 (16 December 2022)
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sino date 16 December 2022
SAFLII Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
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Policy
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
Case
Number:
19524
/ 2019
REPORTABLE:
No
OF
INTEREST TO OTHER JUDGES: No
REVISED:
NO
16-12-22
In
the matter between:
GRACIANO
MESQUITA COSTA Applicant
and
RUSSEL
KORTE
First
Respondent
MITREWOOD
PRODUCTS CC Second
Respondent
In
re:
RUSSEL
KORTE First
Applicant
MITRE
VENEERING CC
Second
Applicant
And
MITREWOOD
PRODUCTS CC First
Respondent
GRACIANO
MESQUITA COSTA Second
Respondent
NEDBANK
LTD
Third
Respondent
Delivered
:
This judgment was handed down electronically by
circulation to the parties' legal representatives by email,
and
uploaded on caselines electronic platform. The date for hand-down is
deemed to be 16 December 2022.
Summary
:
Application for contempt of the court order following the interdict
against the first respondent’s
spoliation. The applicant and
the second respondent complaining that first respondent failed to
comply with the court order.
The
first respondent and Veneering CC’s counter application -rei
vindicatio for the return of the melamine press machine.
The
applicant raising points in limine relating to non-joinder and lis
pendens. Lis pendens based on the counter application
that was
filed by the first respondent in the first urgent application. Notice
of motion not necessary in a counter application.
Costs on attorney
and client scale
JUDGMENT
MOLAHLEHI
J
Introduction
[1]
This regrettably delayed judgment deals
in the main with two applications, the one being an application to
declare the first respondent,
Mr Korte, in contempt of the court
order made by Pearse AJ on 09 October 2019 under the above case
number.
[2]
The
second application, by the first respondent, Mr Korte, is a counter
application in the form of a
rei
vindicatio
and
an interdict against the applicant relating to access to the premises
of the second respondent,
Mitrewood
Products CC,
and
its bank account. This application is similar to the one filed
following the first urgent application. The other aspect of this
application is the purported application by Mitre Veneering CC
(Veneering) for the return of the melamine press machine.
[3]
The
applicant opposed the counter application and raised two points
in
limine
.
The
parties.
[4]
The
applicant, Mr Costa and the first respondent, Mr Korte, are
co-members of the second respondent, holding membership interest
on
an equal basis.
[5]
The
second respondent, Mitre Wood Products CC, is a close corporation
registered in terms of the Close Corporation Act.
[1]
Its business is the supply of wooden products. As alluded to earlier,
the membership interest in it is held on an equal basis by
both the
applicant, Mr Costa and the first respondent, Mr Korte.
[6]
Mr
Korte also conducts business as a sole member of Mitre Veneering CC
(Veneering). Veneering is a close corporation registered
as a Close
Corporation in terms of the Close Corporation Act and conducts the
business of supplying wooden products.
The
counter application
[7]
As alluded to earlier, Mr Korte has
instituted a counter-application against the applicant and the second
respondent. The affidavit
in support of the counter-application is
incorporated into Mr Korte's answering affidavit to the applicant's
supplementary affidavit.
[8]
It is common cause that Mr Korte delayed
in filing his answering affidavit to the applicant's supplementary
affidavit by twenty-three
days. The explanation for the delay is set
out in his affidavit.
[9]
There is no doubt having regard to the
explanation by Mr Korte and the circumstances of this case, that it
is in the interest of
justice that the delay should be condoned.
[10]
The brief background facts to the
counterclaim are that Mr Korte instituted a counter application in
which he seeks an order in
the following terms:
“
1.
That the First, Second and Third Respondents be interdicted to
restore dual authorisation of all banking
transactions and dual
access to the business banking account of the First Respondent held
with the Third Respondent under account
number [....] at the Third
Respondent's Northgate Branch, to the First Applicant;
2.
That the First and Second Respondents be interdicted to provide the
First Applicant with
the following financial information of the First
Respondent on a monthly basis:
2.1.
income statement (including the supporting documents to
each expense
and income item);
2.2.
balance sheet;
2.3.
management accounts;
2.4.
debtors age analysis;
2.5.
creditors age analysis; and
2.6.
monthly bank statements.
3.
That the Second Respondent is interdicted
from taking any material business and/or financial decisions
and/or
any material business transactions in relation to the Second
Respondent, without a resolution signed by the First Applicant
and
the Second Respondent jointly.
4.
That the First Respondent is ordered to forthwith return possession
of the Second Applicant's
Hot Melamine Press Machine with model
number [....]to the Second Applicant."
[11]
It
is apparent from prayer four above that the counter application is in
the form of a
rei
vindicatio
for
the return of the possession of the melamine press machine possessed
by the second respondent or applicant. The other
aspect of the
counter application is an "interdict" prohibiting the
applicant from allegedly denying Mr Korte access
to the second
respondent's premises and using the Nedbank account of the second
respondent.
[12]
The melamine press machine that is the
subject of this dispute was, according to Mr Korte, installed on the
premises in Honeydew,
Johannesburg, in a building occupied by
Veneering. Both the second respondent and Veneering operated on the
same premises, however,
in separate buildings.
[13]
The property upon which both entities
conducted their businesses belongs to Mitre Properties. Mitre
Properties and Veneering concluded
a lease agreement in October 2016.
The second respondent also concluded a separate lease agreement with
Mitre Properties in October
2016.
[14]
On 20 February 2019, Veneering cancelled
the lease agreement with Mitre Properties, but the melamine press
machine remained on that
property.
[15]
Mr Korte further alleges that on 28 May
2019, the parties held a meeting where the following options were
given to the applicant
regarding the melamine press machine:
"39.1
The Second Respondent would relocate to Troyeville premises, and the
melamine press would be sold by Veneering to the
Second Respondent at
cost price or,
39.2
The Second Respondent moved to premises situated at Cosmos City and
made payment of R500.000.00 for the melamine press to an
entity named
Corkl Enterprise . . . I (Mr Korte) am the sole member of Conkyl.
Conkyl, which acted as a collecting agent for Veneering;
or
39.3
The Second Respondent make payment in the amount of R28,000.00 per
month to Veneering for the melamine press."
[16]
The second respondent, according to Mr
Korte opted to rent the melamine press machine and was subsequently
invoiced on 17 May 2019
for the payment of the rent. It is alleged
that the second respondent breached the agreement by not paying for
its rental for the
use of the machine. Mr Korte then informed the
applicant that he would be collecting the melamine machine consequent
the failure
to comply with the lease agreement. It is alleged that
the applicant refused to release the machine.
Access
to financial and business information and the premises of the second
respondent.
[17]
Mr Korte complains that the applicant
prevented him from exercising his duties and obligations as a member
of the second respondent
by preventing him from having control over
the affairs of the second respondent. This includes accusing the
applicant of preventing
him from accessing the banking account of the
second respondent with Nedbank. He is, as a result, unable to
transact on behalf
of the second respondent in the bank account.
[18]
Mr Korte alleges in his affidavit that
the applicant removed his authorisation to transact with the bank in
February 2018 after
he transferred from the account of the second
respondent an amount of R234 107.76 to the Veneering account. He
contends that the
applicant did this without the necessary resolution
supporting his action. He further argued that the conduct of the
applicant
and Nedbank was unlawful.
[19]
The other complaint of Mr Korte is that
the applicant refuses to provide him with financial information and
other matters related
to the second respondent's affairs, including
total sales and bank statements.
[20]
The first respondent has yet to dispute
that he has not withdrawn the first counter application. He contends
that that application
fell away because of the agreement between the
parties. The application is yet to be determined by the court.
On the
proper reading of the papers, the question of law and
fact in both the first and second counter application are materially
the
same regarding the ownership of the melamine press machine. The
issue in both applications concerned the following:
(a)
the ownership of the melamine press
machine.
(b)
the alleged rental agreement for the
melamine machine.
[21]
It is
important to note that Mr Korte claims in the first counter
application that he is the owner of the melamine press machine
and in
the second that the owner is Veneering. This is disputed by the
applicant.
[22]
On the other hand, the version of the
applicant (the applicant in the contempt application) is that the
melamine press machine was
added to the assets registrar of the
second respondent following the instruction to do so given to the
financial manager of the
second respondent by Mr Korte. After that,
the second respondent indicated the cost of the machine as being in
the amount of R500,000.00.
This amount was then loaded onto the
capital loan account of Mr Korte. Mr Korte has not filed a replying
affidavit to the applicant's
answering affidavit to the counter
application.
Access
to the premises of the second respondent and participation-the bank
account.
[23]
As alluded to earlier, Mr Korte and the
applicant have an equal business interest in the second respondent.
According to the applicant,
the conflict that arose between the two
was due to a disagreement over the value of Mr Korte's interest in
the business. The value
was for determining the purchase price of
buying him (Mr Korte) out of business.
[24]
It is common cause that the applicant
was responsible for the day-to-day running of the affairs of the
second respondent for several
years. There is further no dispute that
Mr Korte, although still a member of the second respondent, has for
some time not been
active in the affairs of the second respondent. He
confirmed this in the first counter application, where he indicates
that he
no longer has objective input in the financial matters of the
second respondent and has, for the last four years, left the running
of the day-to-day of the business to the personnel. This is also in
line with the averment made by the applicant that Mr Korte
is not an
active member of the second respondent.
Points
in limine
[25]
The
first point
in
limine
raised
by the applicant concerns the issue of joinder. In this respect the
applicant contends that Mr Korte arbitrarily seeks
to join Veneering
and Nedbank in the contempt of court proceedings without following
the proper procedure.
[26]
In the notice of motion, the applicants
(Mr Korte and Veneering) seek the following order:
"1.
That the First, Second and Third Respondents be
interdicted to restore dual authorisation of all banking transactions
and dual access to the business banking account of the First
Respondent held with the Third Respondent under account number [....]
at the Third Respondent's Northgate Branch, to the First Applicant."
[27]
The applicants' (Mr Korte and Veneering)
Counsel argued that it was not necessary to join Nedbank because its
function is to act
as an agent of the parties. In other words, it
only acts upon the instruction of the parties.
[28]
The
above argument is not sustainable when regard is had to the fact that
paragraph 1 of the notice of motion quoted above explicitly
seeks
relief against Nedbank. In this context the bank would have direct
and substantial interest in the matter. It would accordingly
be
prejudiced if not joined in these proceedings should the order prayed
for be sustained.
[2]
[29]
The papers as they stand, Nedbank has
not been joined to the proceedings, and thus any order made against
it would be of no force
and effect as it is not a party to these
proceedings. Nedbank was unilaterally inserted by Mr Korte when the
answering affidavit
to the supplementary affidavit was filed. The
answering affidavit, as stated earlier, incorporated the counter
application.
[30]
In prayer 4 of the notice of motion, the
applicants seek an order in the following terms:
"4.
That the First Respondent is ordered to forthwith return possession
of the Second Applicant's Hot Melamine Press Machine
with model
number [....]to the Second Applicant (Veneering CC)."
[31]
It should be noted that until 3 May
2022, there was no proper application to join Veneering in the
proceedings. It should also be
noted that Mr Korte uploaded an
unsigned and unissued application on the caselines platform on 29
April 2022. In this regard, the
applicants (Mr Korte and Veneering)
also failed to file a practice note as required by the Practice
Directive of the Court.
[32]
As indicated earlier, Mr Korte delivered
a combined affidavit under the same case number as the contempt of
court application. He
cited Veneering as a co-applicant and Nedbank
as another respondent. He then, without making a formal application
to join Veneering
and Nedbank into the existing proceedings, refers
to rule 6(7) of the Rules. The counter application was not brought as
a separate
application.
[33]
The purported unilateral joinder of both
Nedbank and Veneering is irregular; thus, until Veneering and Nedbank
are properly and
formally joined to the current application, they are
not properly before the court. In the circumstances the proper
approach to
adopt is to have the matter postponed to be heard with
the liquidation application was proposed by the applicant’s
Counsel
during argument.
The
second point
in
limine
[34]
The
second point
in
limine, lis pendens,
which
has its origin in the first urgent application when the applicant
sought a spoliation order against Mr Korte.
[35]
The
requirements of plea of
lis
pendens
is
well known in our law. They were set out in Nestle (South Africa)
(Pty) Limited vs Mars Inc,
[3]
as
follows:
"The
defence of
lis alibi pendens
shares features in common with
the defence of res judicata because they have a common underlying
principle, which is that there
should be finality in litigation. Once
a suit has been commenced before a tribunal that is competent to
adjudicate upon it, this
suit must generally be brought to its
conclusion before that tribunal and should not be replicated (
lis
alibi pendens
). By the same token the suit will not be permitted
to revive once it has been brought to its proper conclusion (
res
judicata).
The same suit between the same parties should be
brought once and finally."
[36]
In
this respect, Mr Korte filed an answering affidavit incorporating a
counter-application similar to the one filed after the applicant
filed his supplementary affidavit. In his answer, Mr Korte claimed
that he owned the melamine press machine. In the same affidavit,
he
also referred to the applications he has made in terms of sections
49,
[4]
and 36,
[5]
of the Close Corporation Act.
[37]
It
is common cause that the first counter application was not supported
by a notice of motion as would ordinarily be required in
motion
proceedings. An application unaccompanied by a notice of motion is
generally regarded as defective. For obvious reasons,
a different
approach is adopted in relation to a counter-application which is
governed by rule 6(7) of the Rules. In this regard,
a notice of
motion is unnecessary; thus, the counter application will stand even
if not accompanied by a notice of motion.
[6]
Rule 6(7) provides:
"(7)
(a) Any party to any
application proceedings may bring a counter-application
or may join
any party to the same extent as would be competent if the party
wishing to bring such counter-application or join such
party were a
defendant in an action and the other parties to the application were
parties to such action. In the latter event,
the provisions of rule
10 will apply."
[38]
The counter application incorporated
into the answering affidavit to the first urgent application was not
accompanied by a notice
of motion. Despite this, it sustains as a
counter application in terms of rule 6(7) of the Rules.
[39]
It was argued on behalf of Mr Korte that
the counter application fell away because a settlement agreement was
concluded between
the parties. This is, however, not supported by the
facts. The issues raised in the counter application were fully
ventilated
in the papers. It is common cause that Mr Korte did not
proceed with the counter application, nor did the court finalise the
application.
It follows, therefore, that the counter application is
still pending.
[40]
The
other point raised by the applicant, which is part of the
lis
pendens,
concerns
the liquidation application instituted by Mr Korte against the second
respondent. As alluded to earlier the applicant argued
in this regard
that it would be appropriate to deal with the issue of the ownership
of the melamine press machine in the consolidated
hearing of both the
counter application and the liquidation application.
Background
to the contempt application
[41]
The contempt application follows the
urgent spoliation application that the applicant had instituted
against Mr Korte. The applicant's
case in the first urgent
application was that he and the second respondent were in peaceful
and undisturbed possession of the melamine
press machinery until Mr
Korte and a certain 'Janes' wrongfully and unlawfully interfered with
such possession.
[42]
The dispossession of the property in
issue occurred on 31 May 2019 when Mr Korte physically and unlawfully
prevented the applicant
and the employees of the second respondent
from having access to the premises and from conducting the daily
business of the second
respondent.
[43]
According to the applicant, the dispute
between the parties arose from a disagreement about Mr Korte's demand
that the applicant
purchases his business interest in the second
respondent. Whilst this was acceptable to the applicant, they could
not agree on
the value of the membership's interest in the second
respondent.
[44]
About the allegation of spoliation, the
applicant testified in the urgent application that Mr Korte and those
who were with him
on the day in question broke into the premises of
the second respondent and removed files and computers from the
premises of the
second respondent.
[45]
On 31 May 2019, the applicant filed a
supplementary affidavit complaining that subsequent to filing the
founding affidavit, Mr Korte
had contacted some of the clients of the
second respondent and informed them about the conflict between the
parties, thus compromising
the interests of the second respondent.
[46]
The applicant was successful in the
urgent application, and thus Mr Korte was interdicted from entering
the premises of the second
respondent and removing any assets from
the premises. The order in this respect reads as follows:
“
1.1
The First Respondent is interdicted and restrained from:
1.1.1
arbitrarily taking any steps to deprive the applicant and the Second
Respondent's staff employees, customers and visitors
of undisturbed
access to the Second Respondent's premises situated at [....] R[....]
Road, L[....], Honeydew, Gauteng ("the
premises");
1.1.2
from entering or accessing the premises of the Second Respondent
other than in the ordinary course of the Second Respondent's
business;
1.1.3
removing any files, documents, records and assets from
the premises
of the Second Respondent other than in the ordinary course of the
Second Respondent's business,
1.1.4
contacting and informing customers, suppliers, employees and visitors
of the Second Respondent, or potential customers, suppliers,
employees or visitors of the Second Respondent, as well as the market
in general:
1.1.4.1
that the business of the Second Respondent has closed down;
1.1.4.2
that the Second Respondent has ceased
to operate or trade;
1.1.4.3
the internal and private disputes between the applicant."
[47]
On 9 July 2020, the applicant instituted
the second contempt of court and spoliation proceedings. In that
instant, the applicant
complained that Mr Korte wrongfully and
unlawfully removed a critical component of the melamine press machine
from the second respondent's
premises rendering the plant inoperable.
He also removed the keys of the second respondent's premises,
including those of the two
trucks.
[48]
The urgent application was removed from
the roll by agreement between the parties. The agreement concerned
certain undertakings
made by the parties. The undertakings Mr Korte
made were set out in the email from the applicant's attorney of
record and confirmed
in another email from Mr Korte's attorneys' of
record. The email reads as follows:
"Dear
Mr van Zyl,
1.
Our recent telephonic discussions on 17
December 2019 between our Mr Pattansky, Advocate RJ Bouwer, and
yourself refers.
2.
We confirm that you and Mr Russel Korte
will provide a written undertaking on the following terms:
2.1
That Russel Korte, or his representative, will forthwith return the
following items to the premises of Mitrewood Products CC,
from which
same was removed by Mr Korte during the period of 12 and 13 December
2019:
2.1.1
On immediate arrangement with Graciano Mesquite Costa, who can be
contacted on 083 . . ., the component of the Melamine plant
machine
will forthwith be reinstalled by Mr Korte, or his representative, at
the cost of Mr Korte, to reinstate the plant to a
full working
condition;
2.1.2
The keys to the factory of Mitrewood Products CC;
2.1.3
The keys to the Truck bearing the registration number [....].
2.1.4
The keys to the Truck bearing the registration number [....]. 2.2
Russel Korte gives an unequivocal undertaking that:
2.2.1
He will not under any circumstances enter the premises of Mitrewood
Products CC at [....] R[....] [....] Road, Lazerpark,
Roodepoort
unless accompanied by yourself or a representative from your office
upon prior arrangement with Mr Costa and our office.
2.2.2
Russel Korte will not in any way intimidate, harass, and/or threaten
and/or harm Graziano Mesquita Costa, the staff and employees
of
Mitrewood Products CC.
2.2.3
He will not employ or use any third party to commit the acts referred
to in paragraph 2.2.2 above.
2.3
Should Mr Korte breach the terms, as set out above, our client may
supplement the urgent application and proceed on an urgent
ex-parte
basis;
2.4
Upon receipt of the written undertakings, or written confirmation
thereof as set out above, our client will remove the
urgent
application set down for hearing on 18 December 2019 at 10:00am;
The
costs of the urgent application will be reserved.
We
await your written undertaking in this regard. Kindly also email a
copy of the written undertaking to our Counsel at [....].
In
the interim, all our client's rights remain strictly and expressly
reserved."
[49]
The email from Mr Korte's attorneys of
record confirmed the above as correct and a true reflection of the
agreement between the
parties, dated 17 December 2019. It reads as
follows:
"Dear
Mr Patiansky,
Your
email under reply refers.
I
hereby provide the undertaking on the terms as set out in your
email.
Trusting
you find the above in order."
[50]
In
compliance with the agreement Mr Korte, on 6 January 2020, returned
the components of the melamine machine, keys to the factory,
and the
keys to the two trucks.
[51]
The applicant contends that Mr Korte
breached the order of 12 May 2020 by demanding the return of the Polo
motor vehicle used by
the second respondent. Although he did not
pursue the demand, the applicant’s complaint is that this
constitutes intimidation
of the employees in that he threatened to
have the employee jailed if he did not comply with his demand because
the possession
of the motor vehicle according to him amounted to
"theft."
[52]
The applicant further accused Mr Korte
of having removed two keys which are essential to the operation of
the melamine press machine.
[53]
It is common cause that Mr Korte was on
that day excessively intoxicated and had to be escorted from the
premises of the second
respondent by his attorney of record.
[54]
In
brief, the applicant contends that Mr Korte breached clause 1.1.2 of
the court order in that he entered the premises of the second
respondent on 22 June 2020 and removed the keys.
The
issue
[55]
The issue in the contempt of court
application is whether Mr Korte is guilty of contempt of court in
that he failed to comply with
the order made by Pearse AJ on 09
October 2019.
Principles
governing contempt.
[56]
The
crime of contempt of a court arises from unlawfully and intentionally
disobeying a court order.
[7]
It
is trite that an applicant in contempt of court proceedings bears the
onus to show the following: (a) that a court order was
granted; (b)
that the court order was served on the respondent, or that the
respondent had knowledge of the court order; and (c)
that the court
order was not complied with by the respondent.
[57]
It
is also trite that once the above requirements are satisfied, a
presumption arises that the respondent's non-compliance is wilful
and
mala fide unless the respondent can show reasonable doubt as to
wilfulness and mala fide. The test in this regard was summarised
in
Judicial Commission of Inquiry into Allegations of State Capture,
Corruption and Fraud in the Public Sector including Organs
of State v
Zuma and Others,
[8]
as follows:
"once
it is proven that an order exists and was served on a litigant who
did not comply therewith, contempt will have been
established beyond
reasonable doubt unless the respondent establishes a reasonable doubt
relating to wilfulness and
mala
fides
."
[58]
In the present matter, Mr Korte does not
deny entering the premises of the second respondent in contravention
of the court order.
He concedes in paragraph 167 of his affidavit
that: ". . . I realise that my actions were wrongful."
He further
states in paragraphs 206 and 207 of the affidavit that:
"206
Initially, I denied that I took the keys because after a diligent
search the following morning, I could not find them
in my
possession.
207
I, however, accept the applicant's version that I did, in fact, take
keys of the melamine press."
[59]
In light of the above, it is clear that
there is no reasonable doubt that Mr Korte wilfully and in bad faith
disobeyed the court
order. He is accordingly guilty of contempt
of the court. The next issue to determine is the sanction to be
imposed.
[60]
As alluded to earlier, Mr Korte was
aware of the court order. There is no evidence in his affidavit that
he did not understand the
order or appreciate the consequence of
non-compliance. Although he regrets his conduct, the non-compliance
with the order occurred
on more than one occasion. The consumption of
alcohol is not a defence or an excuse, however, its role in Mr
Korte’s conduct
connot be ignored
[61]
I do not belief that in the
circumstances of this case incarceration would be an appropriate
sanction. The appropriate sanction
is a suspended fine on condition
that Mr Korte does not in that period commit the same offence.
Applicant's
expended interdict.
[62]
In addition to the contempt application,
the applicant seeks an order preventing Mr Korte from entering the
second respondent's
premises and intimidating the second respondent's
employees. The order in this regard is sought on the basis that the
order obtained
earlier is inadequate in protecting the rights of the
applicant and the second respondent. The order is sought on an
interim basis.
[63]
The applicant further contends that he
and the second respondent have a clear right to be protected from Mr
Korte's conduct and
that they have a well-grounded apprehension of an
infringement of their rights by him.
[64]
Mr Korte's Counsel correctly argued that
the extended interdictory relief sought by the applicant is
unsustainable because the applicant
has an alternative relief in the
form of a winding up of the close corporation. He further argued that
the prayer for the extension
of the order amount to a variation of
the order of 9 June 2020. Accordingly, the extended
interdictory relief sought in the
contempt of court application
stands to fail.
The
costs
[65]
The
applicant's Counsel argued that costs in this matter should be
punitive based on attorney and client scale.
[66]
The
approach to adopt when dealing with the issue of costs on attorney
and client scale was summarised by the Constitutional Court
in Public
Protector v South African Reserve Bank,
[9]
as follows:
“
Costs
on an attorney and client scale are to be awarded where there is
fraudulent, dishonest, vexatious conduct and conduct that
amounts to
an abuse of court process. As correctly stated by the Labour Appeal
Court―
“
[t]he
scale of attorney and client is an extraordinary one which should be
reserved for cases where it can be found that a litigant
conducted
itself in a clear and indubitably vexatious and reprehensible
[manner]. Such an award is exceptional and is intended
to be very
punitive and indicative of extreme opprobrium.”
[67]
In
considering whether costs on attorney and client scale should be
awarded regard is to be had to the conduct of Mr Korte. The
papers
reveal that he deliberately and mala fide failed to comply and
blatantly undermined the court order that had directed him
to refrain
from his unlawful conduct. Furthermore, the order restraint him from
threatening, abusing, intimidating and harassing
the employees of the
second respondent and the unlawful removal and spoliation of the
component essential for the operation of
the melamine plant.
Conclusion
[68]
It is clear from the above discussion
that the counter application is not properly before the court due to
the non-joinder of both
Veneering and Nedbank. Furthermore, the
counter application is not ripe for hearing pending the finalisation
of the counter application
filed following the first urgent
application.
[69]
About the contempt of the court order of
9 October 2019, there is no doubt that the applicant has successfully
discharged his onus
of showing that Mr Korte is beyond reasonable
doubt guilty of the contempt of that order and thus deserve
punishment for that reason.
Having regard to the circumstances of
this case it appears the appropriate sanction would be a fine instead
of incarceration.
Order
[70]
In light of the above the following
order is made:
1.
The late filing of the answering
affidavit by MR Korte is condone.
2.
The
counter-application is postponed to be heard with the pending
winding-up application under case number 21/51970 with costs.
3.
The First Respondent
is guilty of contempt of the court order made on 9 October 2019;
4.
The First Respondent
is to pay a fine for contempt of the court order in the sum of
R30 000,00 which is suspended for a period
of 12 months on
condition that Mr Korte does not commit the same offence.
5.
The First Respondent
is to pay the costs of the of contempt of court order application on
the scale of attorney and client.
E
MOLAHLEHI J
Judge
of the High Court
Gauteng
Local Division, Johannesburg.
For
the applicant: Adv
RJ Bouwer
Instructed
by: Martini
Patlansky Attorneys
For
the respondent: Adv
E Coleman
Instructed
by: Ernest
Van Zyl Attorneys
Hearing
date: 9
May 2022
Delivered:
16 December 2022.
[1]
Act
number 69 of 1984.
[2]
See
Gordon
v Department of Health
(337/2007)
[2008]
ZASCA 99
(17
September 2008) paragraph [9].
[3]
2001 (4)(SA) 542 (SCA).
[4]
Section
49 of the Close Corporations Act provides that a member may
institute proceedings where there was an act or omission in
the
conduct or affairs of the business by the corporation or by the
other member or members which were unfairly prejudicial to
such
member.
[5]
Section
36(1)
of the Close Corporations Act provides various grounds upon which
membership of a person in a close corporation can be terminated.
[6]
See
Erusmus Superior Court Practice D1-80.
[7]
See
Fakie
N.O. v CCII Systems (Pty) Ltd
[2006] ZASCA 52
;
2006 (4) SA 326
(SCA).
[8]
2021
(5) SA 327 (CC).
[9]
[2019] ZACC 29.
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