Case Law[2025] ZAWCHC 165South Africa
Technoserve Medium Voltage (Pty) Ltd v Technical Reticulation Services (Pty) Ltd and Others (20127/23) [2025] ZAWCHC 165 (15 April 2025)
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Judgment
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# South Africa: Western Cape High Court, Cape Town
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## Technoserve Medium Voltage (Pty) Ltd v Technical Reticulation Services (Pty) Ltd and Others (20127/23) [2025] ZAWCHC 165 (15 April 2025)
Technoserve Medium Voltage (Pty) Ltd v Technical Reticulation Services (Pty) Ltd and Others (20127/23) [2025] ZAWCHC 165 (15 April 2025)
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FLYNOTES:
LABOUR
– Restraint –
Conspiracy
–
Several
employees resigning – Applicant contending that employees
had common purpose to engage in unlawful competition
–
Evidence of messages between employees – Concept of
“springboard” – English concept of conspiracy
not definitively adopted into South African law – Factual
enquiry – Key unlawful acts alleged were not established
–
Also not established was conspiracy directed at harming of
applicant by unlawful means – Application dismissed.
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
Reportable
Case
number: 20127/23
In
the matter between:
TECHNOSERVE
MEDIUM VOLTAGE (PTY) LTD
Applicant
and
TECHNICAL
RETICULATION SERVICES (PTY) LTD
First
Respondent
JOHAN
PETZER
Second
Respondent
THOMAS
LOUW DE WET
Third
Respondent
DAVID
EDWARD STOUT
Fourth
Respondent
JOHANNES
FREDERICK VISSER
Fifth
Respondent
CARL
BOTHA
Sixth
Respondent
FISTON
KONGOLO
Seventh
Respondent
HERMANUS
GROENEWALD
Eighth
Respondent
JOHANNES
VAN BRAKEL
Ninth
Respondent
RANDALL
WILLIAMS
Tenth
Respondent
TREVOR
DE BRUIN
Eleventh
Respondent
Heard
: 23, 30 August 2024 and 13 September 2024
Delivered
: 15 April 2025
JUDGMENT
SIDAKI
AJ
Introduction
[1]
The applicant launched an urgent application on 10 November 2023
seeking
the following relief:
‘
(1) That the
applicant’s non-compliance with the Rules relating to forms,
time periods and service be condoned and permitting
this application
to be brought by way of urgency in terms of Rule 6(12)(a).
(2) That a rule nisi
be issued calling upon the respondents to show cause on Wednesday the
6
th
of December 2023 why an order in the following terms
should not be made final:
(2.1) That the
respondents are interdicted and restrained for a period of eighteen
months, from 16 October 2023 and ending on 16
April 2025, from:
(2.1.1) Soliciting any
existing or previous client of the applicant for the purposes of
conducting or providing any Medium Voltage
installations, services or
business operations;
(2.1.2) Soliciting or
employing any existing employee of the applicant for the purposes of
conducting or providing any Medium Voltage
installations, services or
business operations;
(2.1.3) Utilising the
applicant’s confidential information (which includes the
applicant’s safety file accreditation,
identity as a safety
accredited entity, trade secrets, prices, pricing structures,
customer lists and customer contact information)
in any manner
whatsoever;
(2.1.4) Providing any
Medium Voltage installation, service or maintenance services as an
in-house service, utilising its own employees
or those of its related
subsidiary or holding company entities; and
(2.1.5) Interfering
with the applicant’s business operations in any manner
whatsoever.
(2.2) That the
respondents are ordered to pay, jointly and severally, the costs of
this application including the costs of two counsel,
the one paying
the other to be absolved.
(2.3)
Further and/or alternative relief.
(3) That pending the
return date the rule nisi and Orders contained in paragraph 2 and its
subparagraphs inclusive shall act as
an interim interdict and order.
(4) That the applicant
shall institute an action (“the action”) within thirty
days of the granting of the rule nisi
for orders against the
respondents, which may include prayers extending the operation of the
interim interdictory relief for an
appropriate period of time, and/or
for damages.
(5) That the action
shall proceed in accordance with an expedited timetable to be agreed
between the parties at the hearing of this
application, and failing
such agreement in accordance with a directive from the court.
(6) That the
respondents shall pay the costs of this application, jointly and
severally, the one paying the other to be absolved,
and that such
costs include the costs of two counsel.
(7) Further and/or
alternative relief.’
[2]
The application was set down for hearing on 21 November 2023, and the
respondents were afforded until 17 November 2023 to file answering
papers. The respondents opposed the application and filed answering
affidavits in which,
inter alia
, they contested urgency. By
agreement between the parties, the matter was postponed to 6 December
2023 for hearing. On that date,
the parties agreed to an order
postponing the hearing to 8 May 2024, and provided a timetable for
the first and second respondents
to produce WhatsApp messages
referred to in the answering papers.
[3]
On the hearing date, the parties again agreed to postpone the matter
to
23 August 2024, and to permit the exchange of further pleadings:
a)
On 23 May 2024, the applicant filed a supplementary
replying
affidavit;
b)
On 14 June 2024, the respondents filed a response
thereto.
[4]
This swelled the pleadings bundle to some 947 pages.
[5]
Oral argument was heard over a period of three days,
on 23, 30 August
and 13 September 2024.
Background
The
parties
[6]
The applicant, Technoserve Medium Voltage (PTY) LTD) (“
Technoserve
”)
carries on business as an electrical engineering firm specialising in
installation and maintenance services for medium
voltage industrial
electrical equipment and systems.
[7]
The first respondent, Technical Reticulation Services (PTY) LTD
(“
TRS
”), was previously known as Technosales
Boland (Pty) Ltd (Technosales). In 2020, it and Technoserve changed
the composition
of their shareholders in the course of a division of
the Technoserve Group of companies, which had until then specialised
in providing
various services in the electrical engineering industry.
[8]
The division of the Technoserve Group was underpinned by a share-swap
agreement between three individuals: one Mr Veldhuizen, Mr R Botha
and the second respondent, Mr Petzer. As a consequence of the
division on 26 May 2023, Technosales changed its name to TRS and
became a company specialising in sales of industrial electrical
equipment and systems. Mr Petzer was its director and shareholder. On
the other hand, Technoserve became a company providing installation
and maintenance services for industrial electrical equipment and
systems. It was controlled by Mr R Botha and Mr Veldhuizen.
[9]
The third to eleventh respondents are persons who were previously
associated
with Technoserve either as its directors, shareholders or
employees.
Factual
matrix
[10]
During September 2020, Messrs Petzer, Veldhuizen and R Botha
concluded what they termed
a ‘gentlemen’s agreement’,
including a so-called ‘non-compete agreement’, which was
due to expire
on 8 September 2023. This formed a part of the share
swap agreement which divided the Technoserve Group. The non-compete
agreement
included the following clauses:
‘
f)
i). For a period
of 3 years, the group Technoserve Electrical and Electronic
Engineering and Technoserve MV will not establish new
businesses that
will compete with Technosales, Nedlog and Sallab.
ii) The reverse of (i)
will also apply.
g) The respective
businesses will not remove staff from each other for a period of 3
years. During this 3-year period if an employee
resigns from one
group, the other group will not employ him/her for 6 months.’
[1]
[11]
In the founding affidavit, Mr R Botha stated that there was,
generally, apparent compliance
with the terms of the non-compete
agreement, in that the companies worked independently, albeit that
they subcontracted work between
each other. Technoserve, however,
first picked up signs of what it considered to be non-compliance only
after the expiry of the
non-compete agreement. This was when a number
of Technoserve’s employees, described as its ‘entire
operational team’,
suddenly resigned
en masse
:
a)
Mr Kongolo, Mr Groenewald and Mr De Bruin tendered their respective
letters of resignation on 18
September 2023, stipulating 16 October
2023 to be their last working day;
b)
Mr Van Brakel gave notice of retirement on 18 September 2023;
c)
Mr Williams tendered his resignation letter on 15 September 2023,
stipulating his last working
day to be 31 October 2023; and
d)
Mr C Botha gave notice of his intention to retire on 12 September
2023, stipulating his last working
day to be 31 October 2023, but
left employment on 16 October 2023.
[12]
Faced with this situation, Technoserve inspected these employees’
company-issued
cellular phones and recovered from the SIM cards a
mass of data messages which it transcribed and provided as part of
the record.
An additional tranche of transcribed WhatsApp messages
was introduced into the record during discovery, as indicated above.
I deal
with a synopsis of these messages.
WhatsApp
messages
[13]
Mr Petzer stated that he created a WhatsApp group, named ‘
Technosales
MV groupie
’, in about May 2022. Its members included
employees of the applicant, ‘
due to the fact that the
applicant did approximately 90% of Technosales subcontracting work
’.
Mr Petzer explained that, ‘A
s Technosales are the
responsible party to the client I needed to communicate efficiently
with my subcontractor (especially the
employees of the applicant
doing the work), on jobs for obvious reasons. Before that we would
just call and message each other
individually
’ . . . ‘
The
participants on the group were the team leaders of the applicant,
Visser their manager and me
’ . . . ‘
During April
2023, I started a new WhatsApp group, with the same purpose in mind
as explained above. Originally, only Carl Brakkies
and Visser was on
the group with me. Harry and Trevor joiner in August 2023 and Fiston
and Randall in September 2023’.
(sic)
[14]
On 14 April 2023, Mr Petzer posted a message which read as follows:
‘
No pressure,
but we need to alient (sic) and plan by the time I get back
We also need a name
for the new venture
Start putting on the
thinking caps.’
[15]
Mr de Wet proposed ‘
RECtech
’ as the company name
and Mr Visser sent a proposed logo for the company.
[16]
It’s common cause that the new WhatsApp group, formed in April
2023, was named ‘TRS’.
[17]
On 18 April 2023, Mr Visser wrote, ‘
Johan Venter se julle
gaan hom nou direk kwoteer vir maintenance
’ and
Technoserve’s deponent (Mr R Botha) suggested that this meant
that Mr C Botha was working on a direct TRS quotation
for the
mentioned maintenance work.
[18]
In the period between 25 and 28 April 2023, the group held further
discussions
regarding a new company name, which included the
following:
a)
Mr van Brakel proposed ‘
MV – Tech
’ and Mr
Petzer proposed ‘
Medium Voltage Technical Services
’.
b)
Mr Stout wrote, ‘
My feeling is that there should be no
reference to TS or Tech in anyway. There must be no way that the
customers can think that
the new company is associated with
technoserve
’.
c)
Mr van Brakel wrote, ‘
gebruik die naam Medium of High
Voltage Technical Services voluit, MVTS of HVTS is maar net n
afkorting’
.
d)
Mr Petzer wrote, ‘
Specialised technical services
’
. . . ‘
the reason is that we should not only focus on MV
work and spread our wings
’.
[19]
There were further discussions concerning a meeting which was to be
held by those in the
WhatsApp group. That meeting took place on 29
May 2023. Following the meeting, Mr Petzer sent several messages. One
read, ‘
@ technical rs
’. Mr R Botha interpreted
this to be a suggestion for a company e-mail domain name.
[20]
On 26 June 2023, Mr Petzer shared what seemed to be a weekly
itinerary for a job to be
performed between 30 June and 8 September
2023. He wrote, ‘
Alles sal so week 12 klaar wees onhou altyd
1 week vir oplaai met jou beplaning na manufacturing ons het n tight
schedule
’.
[21]
On 27 June 2023, Mr Petzer wrote, ‘
Ordering the KIA 2500 now
for us and we can discuss other vehicles and tools on Thursday
’
. . . ‘
pushing the buy button now’
. Mr C Botha
responded, ‘
Mooi Mnr Petzer… die begin
’, to
which Mr Petzer responded, ‘
The beginning has just begun
’.
[22]
On 13 July 2023, Mr Petzer wrote, ‘
Worcester SASKO bakery
’.
Mr R Botha interpreted this as a request for a quotation. Elsewhere,
there were other posts referencing companies such
as ‘
Sea
Harvest
’, ‘
Aquila Safari
’, ‘
PenBev
’,
‘
Vendata
’, ‘
KWV
’, ‘
SASKO
’,
‘
Cape Lime
’, ‘
Betko
’ and
others.
[23]
On 8 August 2023, Mr Petzer wrote, ‘
wat gaan aan manne
’
and Mr Stout wrote thereafter:
‘
Hi all, so far
we have paid the deposit for the premises and we have a vehicle
that’s been fully paid for. Is there anything
else we need to
do? As per Johan’s question above what’s happening? What
are you all waiting for?
’
Mr
van Brakel followed up by writing, ‘
Ons wag vir Petzer en
Visser wat om te doen en wanneer ek wil 1ste Sept bedank as hulle so
se’
.
[24]
On 21 August 2023, Mr C Botha posted something which is not
discernible from the record,
but which seemed to have sparked the
following series of responses, interspersed by other posts:
a) Mr
Petzer: ‘
WTF’
;
b) Mr
de Wet: ‘
Maybe it’s time to resign’
;
c) Mr C
Botha depicting ‘
thumbs up and clapping emojis’
;
d) Mr
Petzer: ‘
With immediate effect’
;
e) Mr
Stout: ‘
Agreed. Is there a restraint of trade on your
existing contract?’
. . . Mr C Botha ‘
No restraint
. . . just while working for TMV’
.
[25]
On 17 September 2023, Mr Visser wrote, ‘
almal moet nie enige
vrae of met Evans praat voor ons ne eers gesels het nie…
Brakkies/Carl moet ook nie datums met hom praat
nie
’.
[26]
On 18 September 2023, Mr Petzer wrote, ‘
Well done guys!!!
Welkom offisieel by TRS
’.
[27]
On 19 September 2023, Mr van Brakel wrote, ‘
Baise k%k vandag
hulle is op my spoor
’ (sic).
[28]
On 15 October 2023, Mr Petzer wrote, ‘
Lekker manne one more
day
’.
[29]
On 16 October 2023, the employee respondents served their last day of
work with the applicant.
[30]
On 17 and 19 October 2023, the employee respondents were removed from
the WhatsApp group
and then re-added with their new TRS telephone
numbers.
Demand
[31]
On 20 October 2023, Technoserve’s attorneys dispatched letters
with a similar content
to each of the employee respondents, stating,
inter alia
, that:
a)
Technoserve did not view each termination of employment as being
an
isolated incident, but in a context in which they constituted the
majority of the staff of the medium voltage division;
b)
The said employees acted with a common purpose, under the direction
of Mr Petzer, to take up employment with TRS, a competitor;
c)
The said employees, acting together with TRS and Mr Petzer,
intended
to take away Technoserve’s intellectual property and to use its
confidential contact list to solicit its customers;
d)
While still employed by Technoserve, these employees had done
work
for TRS, including preparing quotations aimed at soliciting
Technoserve’s customers (as reported by certain of those
customers);
e)
Technoserve considered this as unlawful competition and a breach
of
the employees’ duties;
f)
Technoserve sought to protect its intellectual property.
It accused
the employees of ‘
stealing’
its customer base and
taking over Technoserve’s medium voltage work;
g)
Technoserve considered these actions as being aimed at crippling
its
business and, thus, unlawfully to ‘
transplant
’ it
to TRS; and
h)
Technoserve claimed prejudice both financially and in terms
of its
ability to provide service to its customers.
[32]
The letter concluded by making a demand that the said employees
should immediately make
a written undertaking to not take up or
continue employment with TRS for a period of at least 12 months. In
the absence of compliance,
Technoserve indicated it would bring legal
proceedings. The undertaking sought was not forthcoming, and so this
application was
instituted, on the terms and in the manner as I have
set out above.
[33]
It is apparent in this demand, which was presented just before the
launch of the application,
that the applicant initially contemplated
a springboard restraint period of 12 months, and not 18 months prayed
for in the notice
of motion.
Discussion
Evolution
of the remedy sought
[34]
In the notice of motion, the applicant sought a
rule nisi
calling upon the respondents to show cause, on 6 December 2023, why
an order interdicting the respondents for a period of 18 months,
from
16 October 2023 to 16 April 2025, should not be made final. Prayer 3
sought an order that, pending the return date, the
rule nisi
and interdicting orders would act as an interim interdict and orders.
[35]
On 6 December 2023, and on subsequent occasions, the applicant agreed
to a postponement
of the hearing, without addressing the structure
and content of its notice of motion. By the time of the hearing, some
nine months
after the application was instituted, urgency was no
longer a live issue and the prayer for a
rule nisi
to be
issued, returnable on 6 December 2023, had become obsolete.
[36]
During argument, it was stated that Technoserve no longer sought
interim relief ‘
pending the return day and/or outcome of an
expedited action’
, but instead sought a final interdict,
which would ‘
prevent the respondents from enjoying the
fruits of their unlawful conduct for a specific period
’.
The applicant’s counsel handed up from the bar a draft order
seeking relief in the following terms:
‘
(1) The first
to sixth respondents, and the eighth respondent, ninth respondent and
eleventh respondent, be interdicted and restrained
for a period of 18
months from the date of this order (from):
(1.1) soliciting or
employing any existing employee of the applicant for the purposes of
conducting or providing Medium Voltage
installations, services or
business operations;
(1.2) providing any
Medium Voltage installation, service or maintenance services as an
in-house service, utilising its own employees
or those of its related
subsidiary or holding company entities.
(2) The aforesaid
respondents are ordered to pay, jointly and severally, the costs of
this application on a scale as between attorney
and client.’
[37]
The draft order effectively sought an amendment of the notice of
motion without launching
a formal application to amend. A key change
effected by the draft order was that the 18-month springboard period
was to have effect
only from the date of the final order, thus
deviating from the original notice of motion in which, despite a
return day of 6 December
2023, the period of springboard restraint
sought was to run from 16 October 2023 (presumably when the last of
the employee respondents
departed Technoserve) to 16 April 2025.
[38]
It is trite law that a
court is vested with a discretion as to whether to grant or refuse an
amendment.
[2]
In this case, there was
no objection when the draft order was handed up. The essence of the
relief sought in the draft order remains
similar to that in the
notice of motion. I can see no prejudice or procedural disadvantage
to the respondents by allowing the amendment.
[39]
It is common cause that by the time this matter was heard,
Technoserve had not instituted
the action which is foreshadowed in
its notice of motion. I could not get a clear explanation as to why
the action had not been
pursued.
Requirements
of an Interdict
[40]
An interdict requires
someone to refrain from performing a particular act (prohibitory) or
perform a particular act (mandatory).
It affords an applicant
protection against unlawful interference or threatened interference
with their rights.
[3]
[41]
It is trite that a court
should look at the substance rather than form of the relief sought,
in classifying an interdict as final
or interim.
[4]
A final interdict finally
determines the rights of the respective parties to a dispute or
litigation.
[5]
An interdict, even for a
fixed period, may be final in effect.
[6]
[42]
It is settled that an
applicant for a final interdict must show a clear right; an injury or
infringement of a right, actually committed
or reasonably
apprehended; and the absence of similar or adequate protection by any
other ordinary remedy.
[7]
Ad
a clear right
[43]
Whether
the applicant has a clear right is a matter of substantive law.
[8]
The
onus is on the applicant applying for a final interdict to establish,
on a balance of probability, the facts and evidence which
prove that
they have a clear or definite right in terms of substantive law.
[9]
Ad an injury actually
committed or reasonably apprehended
[44]
For an interdict to be
granted, it must be shown (taking into account the
Plascon-Evans
rule,
[10]
where final relief is
sought on motion) that unless restrained by an interdict, the
respondent (i) will continue committing an injury
against the
applicant or (ii) that it is reasonably apprehended that the
respondent will cause such an injury to applicant.
[11]
‘
Injury’
means an action which infringes, interferes with or is prejudicial to
the right which has been shown or demonstrated.
[12]
Physical harm or
pecuniary harm (damages) is not required to constitute an injury,
although it might cause the rights breach or
result from it.
[13]
[45]
In order to obtain a
final interdict, in cases other than an ongoing injury, an applicant
need not establish that injury will arise
or ensue, but needs to
prove a reasonable apprehension of injury of such a nature which a
reasonable person might consider and
conceive of, on being confronted
by the relevant facts.
[14]
This well-grounded
apprehension of irreparable loss or infringement of rights must be
proved as an objective fact, based on substantial
grounds.
[15]
The test is
objective.
[16]
[46]
The court must decide, on
the basis of the facts established, whether there are grounds for the
entertainment of a reasonable apprehension
of loss/injury by the
applicant.
[17]
Ad
alternative remedy
[47]
The courts have determined that an alternative remedy must be:
a)
adequate in the circumstances;
b)
ordinary;
c)
reasonable;
d) be a
legal remedy; and
e)
grant similar protection
to a party.
[18]
[48]
Generally, an applicant
will not obtain an interdict if they can be awarded adequate
compensation or amends by way of damages.
[19]
The enquiry on this leg
is whether an interdict is the only relief or remedy which will
assist the applicant, or whether there is
a satisfactory alternative
remedy.
[20]
[49]
In sum, an interdict is
meant to be a practical remedy, which a court will hesitate to grant
if it appears that, in the form in
which it is cast, it will not
afford the applicant the protection sought.
[21]
Springboard
interdict
[50]
Technoserve described its application in the founding affidavit as
one for a ‘
springboard interdict
’, ‘
pending
the return day and/or outcome of an expedited action, to put an end
to a conspiracy by the respondents to damage the applicant’s
business whilst gaining an unfair and unlawful competitive advantage
of their own at the expense of the applicant
’. I have
mentioned above, that the application was also characterised as aimed
at preventing the respondents from enjoying
the fruits of their
unlawful conduct, for a specific period.
[51]
Mr R Botha elaborated on Technoserve’s position in the founding
affidavit, as follows:
‘
(Technoserve)
require a period of 18 months of interdicted competition in order for
us to recover our employee team and to protect
our business from the
unlawful acts of the respondents. The unlawful advantage achieved by
the respondents is clearly one that
allowed them to commence trading
at the level that they have at least 18 months before they would
otherwise have been able to do.
The ‘springboard’
achieved provided them with an advantage of at least 18 months.’
[52]
In argument, Mr Seale SC, appearing with Mr Fuller, referred largely
to English law authorities,
when explaining the concept of
‘
springboarding
’ and the ‘
springboard
interdict
’ by which the applicant sought to restrain such
springboarding. He argued that the respondents had garnered for
themselves
an unlawful competitive advantage over the applicant,
referred to as a ‘
springboard’
. This springboard,
he contended, was an instance of unlawful competition and should,
accordingly, be interdicted. He explained
the concept, its rationale
and, crucially, how he considered that it should be applied, in this
particular matter, as follows:
‘
The period of
the interdict in a springboard interdict application is calculated on
the basis of the advantage derived by the respondents.
The advantage
consists of the saving of time and resources for the preparation
phase of a new business, and this was conducted
while preparations
were prohibited. The principal advantage achieved by the respondents
consists of the resources, time and effort
saved in establishing an
effective Medium Voltage services unit, which it achieved without
having to follow the usual and lawful
recruitment process.’ . .
.
‘
Had the
respondents conducted themselves lawfully, TRS would not have been
able to commence trading in October with a fully formed
and competent
Medium Voltage services team. A period of at least 18 months after
October 2023 would have been required for it to
achieve, in a lawful
and fair manner, what it was able to do by unlawful means through the
respondents’ conspiracy by October.’
. . .
‘
In order to
place the parties in a position of parity and to achieve the objects
of a springboard interdict, the exclusionary time
period should
commence from the date upon which judgment is granted. Insofar as it
may be argued that the term of the interdict
should run from the
termination of employment date, this would be wrong. The aim of a
springboard interdict is not to prevent competition
during a
restraint period, as in a restraint of trade matter which concerns a
finite contractual term, but to remove and to negate
the unfair
competitive advantage of a specific period of time gained as a
consequence of the unlawful competition.’
[53]
The applicant put
significant stock in certain English case law and principles, which
are evidently premised upon the specific English
law tort of
conspiracy.
[22]
The applicant appears to
maintain that the respondents engaged in an unlawful means form of
conspiracy, which was described in
British
Midland Tool Ltd v Midland International Tooling Ltd & Ors
,
[23]
as follows:
‘
[77]
The
claim is primarily put as an unlawful means conspiracy. The
requirements of that tort are that the claimant proves that it has
suffered loss or damage as a result of unlawful action taken pursuant
to a combination or agreement between the defendant and another
person or persons to injure him by unlawful means, whether or not it
is the predominant intention of the defendant to do so’
see Kuwait Oil Tankers
v Al Bader
2000 EWCA Civ 160
, [2000]2 All ER Comm 271 at para 108
(Nourse Potter and Clarke LJJ). The three essential ingredients for
present purposes are (1)
unlawful means taken pursuant to an
agreement, (2) loss suffered as a result of that, and (3) the
intention to injure by the unlawful
means.’
[24]
[54]
On its own case,
articulated in regard to the English tort of an ‘unlawful means
conspiracy’
[25]
,
it behoves the applicant, then, to establish the necessary elements:
a) to indicate a combination or agreement between the relevant
respondents; (b) to intentionally c) cause damage to the applicant’s
business; d) by unlawful means and (e) which is then
executed, in
such an unlawful fashion, and does, in fact, cause such unlawful
damage.
[26]
Inter alia
,
the applicant would need to:
[27]
a) Show
that each respondent agreed to or acted in a concerted fashion to
harm the applicant, intentionally, and,
by unlawful means;
b)
Identify the unlawful acts inflicting damage to the applicant’s
goodwill and that they were carried out
pursuant to the conspiracy;
and
c)
establish that there was unlawfully inflicted (and in the case of an
interdict, the ongoing or anticipated)
damage to the goodwill of the
applicant’s business, with due reference to the springboard
concept and period.
[55]
This would involve a factual enquiry.
Common
cause facts
[56]
It is common cause that a WhatsApp group named ‘TRS’, was
set up by Mr Petzer
on 12 April 2023. The members of the group
included Mr Petzer, Mr De Wet (third respondent), Mr Stout (fourth
respondent), Mr Visser
(fifth respondent), Mr Botha (sixth
respondent), Mr Groenewald (eighth respondent) and Mr Van Brakel
(ninth respondent). Furthermore,
it is not disputed that upon
resigning from their respective employment at Technoserve, some of
the implicated employees took up
employment with TRS, during October
2023.
The
non-compete agreement
[57]
The non-compete agreement was described as part of a ‘gentleman’s
agreement’
between Mr Petzer, Mr Veldhuizen and Mr R Botha. It
is unclear as to whether this was regarded as legally binding by the
parties
to it.
[58]
It is however not immediately apparent to me whether TRS and
Technoserve were party to
the non-compete agreement. Neither Mr
Veldhuizen nor Mr R Botha, as the parties entitled to enforce that
agreement against Mr Petzer,
are cited as parties to this litigation.
Given this, Technoserve’s entitlement to a cause of action
against any of the respondents
by reference to the non-compete
relationship it has alleged with TRS is unclear. I however, do not
decide the matter on this point.
Factual
disputes
[59]
Whilst there is no serious quibble as to the content of the WhatsApp
messages found on
the employees’ SIM cards, the controversy
concerns the full context in which the messages were posted and,
therefore, the
proper interpretation and meaning which is to be
attached to those messages.
[60]
The applicant contends that the respondent employees, acting together
and in concert with
its corporate competitor, conspired, unlawfully,
to harm its business interests and goodwill by,
inter alia
,
causing its specialised operational team to resign
en masse
,
and to take up employment with the first respondent, taking with them
the applicant’s confidential information and clients.
[61]
Mr R Botha, the director of Technoserve explained the situation, as
he saw it, as follows
in the founding affidavit:
‘
Not only did
the first respondent steal our employees, but our clients too. The
first respondent utilised the applicant’s
team to carry out
work for it during the currency of their employment with the
applicant. In a clandestine manner these employees
provided services
on behalf of the respondent to the applicant’s clients and
subsequently permitted the first respondent
to take over those
clients from the applicant, which it has done.’
. . . ‘
The
existing working relationships between our employees and our clients
were used to transfer those clients to the first respondent
at the
same time as the employees were being taken over by the first
respondent. The first respondent has acquired our workforce
which it
needs to service our erstwhile clients and so has been able to take
over the clients too. In so doing the first respondent
has derived a
significant although unlawful advantage, which could only have been
achieved by our erstwhile employees acting in
breach of their
contractual and fiduciary obligations.’
[62]
Technoserve drew the following conclusions from the facts available
(consisting mainly
of the recovered WhatsApp messages) and it is on
this factual basis that it founded its application:
a) The
employees had been conspiring with each other to springboard TRS and
compete unlawfully with Technoserve
since at least March 2023;
b) The
employee respondents had encouraged one another to resign
en
masse
, in violation of their service contracts and/or fiduciary
duties to their employer, Technoserve;
c) Mr
Visser was doing work for TRS while still a director and in the
employ of Technoserve;
d) The
resigning employees had already been working for TRS for some time
before their formal resignations or
retirement from Technoserve;
e) TRS
had, with the help of the resigning employees, poached and serviced
Technoserve’s clients during
the TRS non-compete period;
f)
Accordingly, TRS together with the employees had intentionally
inflicted harm on Technoserve’s
proprietary interests and
client goodwill. Mr R Botha perceived these as acts of sabotage
perpetrated by the resigning employees
against Technoserve; and
g)
Finally, that the conduct of the resigning employees has deprived
Technoserve of its immediate capacity to
fulfil its contractual
obligations. In this regard, Technoserve alleges that TRS is
rendering identical services to those that
Technoserve had provided
to those of its clients poached by TRS.
[63]
Mr McClarty SC, appearing with Mr M Aggenbach, for the respondents,
criticised the applicant
for its generalised approach to the
transcripts of the WhatsApp messages. The respondents did not,
however, object to the authenticity
and admissibility of those
messages. A full transcript of the WhatsApp messages was attached to
the affidavits and thereby incorporated
into the evidence. The
respondents, for their part, managed, in large measure, to deal with
the accusations levelled against them.
[64]
The respondents took issue with all of the material facts alleged by
Mr R Botha. They:
a)
asserted that the terms of the non-compete agreement did not apply to
TRS or to each of them as individuals,
except for Mr Petzer;
b)
contested the applicant’s understanding of the non-compete
agreement;
c)
challenged the applicant’s interpretation of the WhatsApp
messages. They denied the accusation of carrying
out work on behalf
of TRS and in competition with their employer, Technoserve, in
relation to various Technoserve clients (including
Corobrick, Betko,
Sea Harvest, Aquila, etc). They explained that the Whatsapp
references to these entities related to legitimate
ongoing
Technoserve/Technosales subcontracting work in relation to those
entities;
d)
denied that the employee respondents had been issued with TRS e-mail
addresses while in the employ of Technoserve
(except for Mr Visser
who was issued one only after his suspension by Technoserve);
e)
denied approaching the various Technoserve clients named in the
Whatsapp messages for the purpose of soliciting
their business for
TRS, while still employed by Technoserve. In that regard, it is
noteworthy that Technoserve did not file any
affidavits by clients
confirming this solicitation;
f)
denied conspiring with one another or TRS or soliciting Technoserve
employees; and
g)
denied that the employee respondents constituted the applicant’s
operational team or that all of them
took up employment at TRS.
[65]
The respondents maintained that the applicant did not have the
proprietary interest and/or
confidential information and/or skills
which would attract legal protection. They contended that:
a) The
applicant had failed to specify from which companies the respondents
were to be interdicted from soliciting
business;
b) Any
price structure for services rendered by the applicant was publicly
available;
c)
In this industry,
competing companies often worked together on sites, such that there
were no trade secrets and/or material confidential
information. They
pointed out that the applicant has failed to specify and describe
these. Indeed, it should be noted that, legally,
the applicant must
set down the facts necessary to prove all the requirements to
establish the confidentiality of any information
(and has not done
so)
[28]
;
and
d)
Applicant could not restrain the sixth to eleventh respondents from
applying their respective skills, knowledge
and experience, after
departure from Technoserve, in the absence of any contractual
restraint of trade agreement with them.
[66]
It was held in
Strike
Productions
that:
[29]
‘
[22] For the
applicant to succeed in this case it must establish that it has trade
secrets, confidential information and intellectual
property worthy of
protection and which is “proprietary” to it, which Jacobs
is allegedly using. The claim to confidentiality
must be made on
reliable facts. It is not sufficient for a party to merely state that
it has “intellectual property”,
“know-how”,
“modus operandi” or that certain aspects of its business
are secret or confidential.
[23] The mere fact
that a party chooses to call something secret does not per se make it
so. In Saltman Technicianing Co Ltd &
others v Campbell
Technicianing Co Ltd
[[1948] 65RPC 203 (Ch), at 215]
, Lord
Greene MR stated that, to be confidential, the information concerned
must “have the necessary quality of confidence
about it, namely
it must not be something which is public property or public
knowledge”.’
[67]
When expounding on the matters which he placed in dispute, Mr Petzer
specifically averred
that the non-compete agreement envisaged that
the various companies could compete for installation and maintenance
work and that
this was consistently done. He gave various examples of
this. I ploughed through the replying affidavit in search of a
response
to this particular point, without success. The deponent to
the reply does say that there was no time to respond
ad seriatim
to the allegations in each of the respondents’ affidavits,
although he did address other specific allegations. Nevertheless,
one
would have expected that the deponent would have addressed any false
allegation of this importance in its response, had it
indeed been
false.
[68]
The situation is that all the material facts upon which the applicant
seeks to rely, to
establish a cause of action against the
respondents, are soundly disputed and are incapable of resolution on
the papers. Given
the attendant disputes of fact, it is not feasible
to come to a definitive factual finding on various crucial aspects,
such as:
whether any of the respondents unlawfully interfered in the
contractual affairs of the applicant; breached any restrictive
covenants
or fiduciary duties binding them to the applicant; embarked
on an intentional, concerted or agreed conspiracy to damage the
applicant,
by unlawful means; actually caused unlawful damage to the
subjective right to goodwill belonging to Technoserve.
Factual
link between an individual respondent and the actual or threatened
unlawful conduct must be shown
[69]
The employee respondents
maintained that they, at all material times, were working on behalf
of and for the benefit of Technoserve.
In
Commercial
Stevedoring
,
[30]
the Constitutional Court
held that the law requires, for interdictory relief to be competently
granted, that a factual link between
an individual respondent and the
actual or threatened unlawful conduct must be shown. In that case,
which dealt with an application
for interdictory relief in the
context of a labour strike action, the court found that mere
participation in a strike, protest,
or assembly, in which there is
unlawful conduct, is insufficient to link the impugned respondent to
the unlawful conduct in the
manner required for interdictory relief
to be granted.
[31]
[70]
What would constitute the requisite direct link to the unlawful
conduct (rights breach)
would depend on the anterior question of what
conduct is considered to be delictual or otherwise unlawful, and,
therefore, can
be interdicted.
[71]
The English tort of ‘conspiracy’ appears to deviate from
the South African
law approach in regard to this enquiry, in that a
person/ party to the relevant agreement/combination:
a)
may attract liability
merely from being party to the agreement or combination with the
object of intentionally and unlawfully damaging
the defendant,
without the need for any participation in the unlawful acts that
implement that conspiracy;
[32]
and
b)
is liable for all acts
that are performed by other persons/ party to and implementing the
conspiracy, even where the person does
not participate in those acts,
provided only they are party to the relevant agreement or
combination.
[33]
[72]
By contrast, in respect
to interdicts grounded properly in South African law of delict, the
applicant would, at minimum, need to
link each respondent to the
commission of each act of unlawful competition, even if only as a
joint wrongdoer.
[34]
This link might entail no
more than the instigating, aiding or abetting of any delict, but this
would still require some measure
of active involvement.
[35]
[73]
Thus, mere participation in the relevant WhatsApp group would also
not, without more, be
enough to link the employee respondents into a
delict against Technoserve, even if there may be suspicion of some
unlawful activity
by one or other of the participants.
[74]
To establish a link between an individual respondent and the actual
or threatened unlawful
conduct would involve a factual enquiry. I
deal with the versions presented by each of the respondents below,
which controvert
the allegations made by the applicant.
[75]
Mr Petzer acknowledged having a close relationship with Technoserve
employees, because
he was previously the chief executive officer and
shareholder of the Technoserve Group before it split. He explained
that a significant
amount of work done by Technoserve was
subcontracted to it by Technosales and that, as such, the Technoserve
and Technosales/TRS
teams often interacted with each other.
[76]
The third respondent, Mr De Wet, was a director of TRS, serving
alongside Mr Petzer, until
his resignation on 29 September 2023. It
was stated during argument that an interdict against him was no
longer being pursued.
[77]
Mr Stout, the fourth respondent, was also a director of TRS serving
alongside Mr De Wet
and Mr Petzer, until his resignation on 29
September 2023. Both Mr De Wet and Mr Stout stated the following in
their respective
affidavits:
‘
As part of the
board of directors, we agreed to rename Technosales Boland to TRS to
split our projects that used to run through
Technosales Western Cape
(Pty) Ltd, in which I am a shareholder and a director. Technosales
Boland was dormant and TRS only commenced
trading in October 2023.’
[78]
The fifth respondent, Mr Visser, was a director and 35% shareholder
of Technoserve, and
had served for a period as its managing director.
He was due to retire from Technoserve in 2023 and had communicated
his wish to
the other directors to sell his shares later that year.
He acknowledged having been a member of the WhatsApp group, but
denied
any involvement in the alleged conspiracy against Technoserve
or ever working for TRS. It was stated during argument that an
interdict
was no longer sought against Mr Visser.
[79]
The qualification, skill and experience of the sixth respondent (C
Botha) is in dispute.
In the papers, Technoserve portrayed Mr C Botha
as ‘
a highly skilled MV electrical technician
’
whose skills are in short supply in the industry. Mr C Botha denied
being a qualified electrician or technician or having
any specific
qualification as an electrician, although he acknowledged having
worked in the industry for some 40 years. He claimed
to have been
told by one Mr Coetzee, the new managing director of Technoserve,
that he was not being considered as part of future
plans for
Technoserve. Having reached the age of 63 years, he opted to retire
and refused a fixed term contract to continue working
for
Technoserve. He had approached Mr Petzer for a job at TRS, after his
retirement from Technoserve, and commenced employment
on 17 October
2023. He maintained that his departure from Technoserve and joining
of TRS was not the result of a ‘conspiracy’
with his
fellow employees or TRS. Whilst he admitted being part of the
WhatsApp group, he denied that his activities on that group
amounted
to a conspiracy to harm the applicant.
[80]
The founding affidavit described Messrs Kongolo (the seventh
respondent) and Williams (the
tenth respondent) as assistant
technicians. It was accepted in argument that they were in fact
general workers. Both of them professed
that they did not see any
prospects of advancing their respective careers at Technoserve and
decided to join TRS. The applicant
indicated during argument that it
no longer pursued an interdict against these gentlemen.
[81]
The eighth respondent, Mr
Groenewald, is a qualified electrician who was employed by
Technoserve from April 2022. He tendered his
resignation on 18
September 2023. He denied being a technician and also denied that he
possessed rare skills, and, therefore, contended
that it would be
easy to find a replacement for him. He attributed his resignation to
a workplace falling-out with Mr Coetzee.
He commenced work for TRS on
17 October 2023. He denied knowing any trade secrets or confidential
information of the applicant.
He was part of the TRS WhatsApp group.
He denied that the group conspired to harm the applicant and
explained its purpose, which
was to communicate and coordinate
logistics on the projects that his team were performing for
Technoserve, as a subcontractor for
Technosales, and for social
interaction. Mr Groenewald averred that an interdict in these
circumstances would unduly interfere
with his unrestrained right to
ply his trade.
[36]
[82]
Mr Van Brakel, the ninth respondent, is a qualified electrician. He
was employed by Technoserve
until his retirement at the mandatory
retirement age of 60 years. He submitted his retirement by letter
dated 18 September 2023.
He claimed to have had poor workplace
relations with Mr Coetzee. When he could not secure a work contract
beyond his retirement,
he approached Mr Petzer, who offered him
employment with TRS, as from 17 October 2023. He stated that the
discussions in the WhatsApp
group were not a conspiracy against the
applicant, but concerned subcontracting work between Technoserve and
Technosales.
[83]
Mr De Bruin, the eleventh respondent, was employed by Technoserve as
a qualified technician.
He tendered his resignation on 17 September
2023. He had had his own workplace conflict with Mr Coetzee, which he
claimed was a
major cause for seeking employment with TRS. He denied
conspiring with his fellow employees and TRS to leave Technoserve and
join
TRS. He denied participation in a conspiracy against Technoserve
and averred that his posts on the WhatsApp group were related to
the
work which he was carrying out on behalf of Technoserve.
[84]
The versions presented by the respective respondents suggest that the
factual disputes
concerning the role of each respondent remain. At
very least, an employee would need to be shown to have instigated or
solicited
his fellow employees either to resign, or, to commit any of
the other unlawful acts (or aid and abet the relevant unlawful acts).
Neither this nor the direct commission of the relevant delicts has
been established, to the required legal standard, against each
(or
any) of the respondents.
Conclusions
on conspiracy
[85]
It does not appear as though the concept of ‘conspiracy’
has formed part of
or been definitively adopted as such into the
South African law of delict. Accordingly, in my assessment, applying
the alien tort
of ‘conspiracy’ from English case law,
rather than the ordinary principles of delict, to the South African
law of interdicts,
will produce an erroneous result. Equally,
reliance on English authorities and principles relating to
injunctions, in a case such
as this, will likely distort the proper
application of South African law as it pertains to interdicts.
[86]
During argument, I invited applicant’s counsel to provide me
with a note explaining
the applicability, in South African law, of
the springboard principle, in the context of the concept of
‘conspiracy’,
in order to better understand the basis of
the applicant’s case. The note stated that South African courts
have frequently
applied the springboard doctrine in instances of the
unlawful use of confidential information. The note further stated
that:
‘
In casu, the
respondents’ unlawful springboard subsists in unlawfully
conspiring with the applicant’s then employees
to establish a
business that would compete with the respondent, which entailed
procuring the applicant’s operational team
to resign en masse
and take up employment with the first respondent. The procurement and
the conspiracy breached contractual and
fiduciary obligations.
’
[87]
I have considered these
submissions with reference to some of the relevant South African
authorities. Van Heerden & Neethling
warn of the dangers of any
importation of the principles of this English tort of conspiracy in
regard to the South African delict
of boycotts.
[37]
The Supreme Court of
Appeal, when confronted with a case assessed under the English tort
of conspiracy, by the judge
a
quo
(who,
like me, was unable to find South African authority for a delict of
conspiracy),
[38]
declined to confirm the
judge
a
quo
’
s
view that this tort was consistent with South African delictual
principles, and left the matter open.
[39]
Factual
disputes were foreseeable
[88]
There are clearly sharp
disputes of fact which cannot be resolved on the papers. In
National
Director of Public Prosecutions v Zuma
,
[40]
the Supreme Court of
Appeal held that:
‘
[26] Motion
proceedings, unless concerned with interim relief, are all about the
resolution of legal issues based on common cause
facts. Unless the
circumstances are special they cannot be used to resolve factual
issues because they are not designed to determine
probabilities. It
is well established under the Plascon-Evans rule that where
in motion proceedings disputes of fact
arise on the affidavits, a
final order can be granted only if the facts averred in the
applicant's… affidavits, which have
been admitted by the
respondent… , together with the facts alleged by the latter,
justify such order. It may be different
if the respondent’s
version
consists
of bald or uncreditworthy denials, raises fictitious disputes of
fact, is palpably implausible, far-fetched or so clearly
untenable
that the court is justified in rejecting them merely on the papers.’
[89]
I have canvassed above what I consider to be real and wide-ranging
factual issues which,
in my view, cannot satisfactorily be resolved
without the aid of oral evidence and cross-examination of witnesses.
These disputes
relate to facts which are central to the application
and its determination. They were reasonably foreseeable.
Nevertheless, the
applicant was adamant that the application should
proceed on the papers for final relief.
[90]
The applicant has neither managed to establish the key unlawful acts
alleged, nor, a conspiracy
directed at the harming of the applicant
by unlawful means. It is not feasible, therefore, to engage in a
determinative legal analysis
where the underlying factual basis of
the application remains unresolved.
Interdict
appropriate only when future injury is feared
[91]
I nevertheless deal with the applicant’s legal assertions. The
applicant’s
changed stance, seeking a springboard interdict of
18 months from the date of the order as opposed to the dates
stipulated in the
notice of motion, reflected its argument that a
springboard interdict exists to reverse an unfair competitive
advantage, as opposed
to addressing existing or ongoing rights
violations (such as the ongoing abuse of confidential information or
otherwise). The applicant
specifically highlights that its case is,
predominantly, focused on addressing the effects of alleged past
wrongs, which might
have occurred during the period that the employee
respondents were employed and under contractual restraints or
fiduciary duties
to the applicant or during the period that they
allege TRS was subject to the non-compete agreement. It is during
this period that
solicitation of and by employees and the diversion
of project work are alleged to have taken place and it is largely on
the WhatsApp
records of this period that the applicant relies to
prove its case.
[92]
As I understand springboards, they are a measure of the transitory
period for which the
protected right (including confidential
information) remains in existence and, therefore, can be protected
from violation by interdict.
I discuss, below, the basis upon which I
hold that interdicts are not available for past and completed
breaches of rights, even
if an unfair competitive advantage continues
to accrue or exist long after that breach. Interdicts are to prevent
ongoing or reasonably
apprehended future breaches of rights; they are
not there to intrude on the domain of damages by addressing ongoing
or long-term
damages or advantages flowing from such past breaches of
rights.
[93]
The Supreme Court of
Appeal held in
National
Council of Societies for the Prevention of Cruelty to Animals v
Openshaw
,
[41]
as follows:
‘
[20] An
interdict is not a remedy for past invasion of rights but is
concerned with present or future infringements.
[42]
It is appropriate only
when future injury is feared.
[43]
Where
a wrongful act giving rise to the injury has already occurred, it
must be of a continuing nature or there must be a reasonable
apprehension that it will be repeated.
’
[94]
The past invasion of
rights should be addressed by an action for damages.
[44]
Interdicts are not and
should not be a substitute for a damages action.
[95]
In
S
v Baloyi
[45]
(albeit in the context of
domestic violence interdicts), the Constitutional Court held that the
principal objective of granting
an interdict is not to punish past
misdeeds, but to prevent future misconduct.
[46]
[96]
In the context of an
unlawful competition case relating to springboarding, the above
principle was reiterated in the case of
Africa
Parts Group Holdings (Pty) Ltd and Others v Titan Auto Parts (Pty)
Ltd and Others
,
[47]
where the court stated:
‘
There is a
further reason the second applicant is not entitled to interdictory
relief, final or interim. Interdictory relief is
not aimed at
addressing past wrongs; but to prevent future harm reasonably
apprehended. Even if for the sake of argument I were
to accept that
the second applicant has established an actual injury committed in
the past, which I am prepared to do, this does
not entitle it to an
interdict. The fact that the former employees in breach of their
contractual obligations divulged confidential
information, or any or
all of the respondents misused the second applicant’s
confidential information giving rise to a claim
in delict, is not
proof that they will do so in the future; it is merely evidence from
which to imply an intention to continue
doing so . . . ’
[48]
(citations omitted)
[97]
The
court in
Knox
D’Arcy
,
[49]
recognized
that the effectiveness of information (and, therefore, the
confidentiality) which provides a springboard ‘
diminishes
with the passage of time and ultimately evaporates entirely
’
.
If the legal right (confidentiality) which the applicant seeks to
protect has diminished or has evaporated, then an interdict,
interim
or final, is not the appropriate remedy. I consider the following:
a)
The fact that skill, time
and effort are required to compile, assemble or coordinate otherwise
public objects or information in
useful systems, forms or to deduce
information from public objects or information is the very
characteristic which qualifies these
forms, systems or deductions to
be confidential information (provided they are also kept secret).
[50]
In such cases, any
confidentiality is transitory - for the springboard period it would
take for someone to deduce, compile, assemble
or coordinate them
independently.
[51]
Accordingly, as I see it,
the springboard is and defines the period of confidentiality for such
information, as opposed to being
merely the time period of unfair
advantage imposed to penalise the person filching such information.
Since it is not merely the
latter, it cannot be imposed on the
infringer at any time (even when the confidentiality has long gone)
in order to level the competitive
playing field;
b)
A
number of South African cases confirm that a springboard disappears
when the information protected by it is no longer confidential.
[52]
When
this happens, the right to an interdict also disappears.
[53]
That
is in line with the principle that an interdict can only be granted
for a continuing or reasonably apprehended future violation
of rights
(such as continued or future unlawful use of confidential
information) and not for a past violation. In
Spieth
and another v Nagel
,
[54]
the springboard principle
was extended to an ex-director’s ongoing exploitation of
corporate opportunities filched from the
company of which he was a
director. The court emphasized that a springboard interdict could not
be imposed as punishment for past
misconduct, but only for the
ongoing breach of the ex-director’s continuing fiduciary duties
to the company because of his
ongoing exploitation of this corporate
opportunity.
[55]
c)
I have canvassed above,
the period of some nine months that it took from launching the
application to the hearing. A survey of various
cases suggests that a
springboard may disappear in the course of a delay or lengthy legal
proceedings, long before any corrective
interdict is given.
[56]
This is because the
confidentiality, being the springboard period, has expired, even
though any lasting competitive advantage gained
thereby may not have
been redressed, although this may then be addressed by way of
damages; and
d)
An
interdict is permissible as a remedy for an ongoing or future breach
of a right,
[57]
and
not merely for the ongoing or future suffering of physical or
pecuniary harm or damage.
[58]
Accordingly,
no interdict is permissible where the breach of rights occurs in the
past, even if damages from it continue to accrue
into the future. In
Reddy
v Siemens Telecommunications (Pty) Ltd,
[59]
in the
context of enforcing a restraint agreement, the court confirmed that
breaching a contractual restraint by entering the employ
of a
competitor was sufficient for an interdict, quite independently of
whether any damage would flow from this.
[60]
Even in cases where the
breach of rights is founded in a delict of unlawful competition, a
breach of that right occurs at the time
the very first damage is
manifested (not as the damage thereafter accrues or for the period it
persists).
[61]
[98]
An applicant is required to prove, not merely
allege, the following two integrally linked material facts:
a)
the confidentiality of
any information claimed as such.
[62]
The requisite
confidentiality has very specific legal requirements.
[63]
b)
the length of its
springboard.
[64]
[99]
In this case, the applicant has not put up the specific facts and,
where necessary, expert
evidence to prove these material facts. It is
not clear how the period sought for the springboard was calculated.
[100]
In contrast to the South
African position sketched above, an English court in
Vestergaard
Frandsen A/S & Ors v Bestnet Europe Ltd & Ors
,
[65]
opined after a review of
contradictory English authorities, that it was unclear whether an
springboard injunction can be granted
to prevent a defendant from
benefiting from a past misuse of confidential information.
[66]
[101]
The grant of an injunction to prevent a defendant from benefitting
from a past (and not continuing) misuse
of confidential information
or some other past unlawful act is contrary to standard South African
principles governing interdicts
and renders any English authorities,
on this point, an unreliable guide to South African law.
[102]
Insofar as the applicant sought to base its cause of action on an
alleged unlawful solicitation of employees
(by one another or by TRS)
occurring during the period of employment, any such breaches of
rights would lie in the past. This could
not be the subject of an
interdict.
Order
[103]
In the result the following orders are made:
a)
The
application is dismissed with costs. Such costs to include the costs
of 21 November 2023, 6 December 2023 and 8 May 2024 and
to include
the costs of two counsel on scales C and B of the High Court scale.
T.S. SIDAKI
Acting Judge of the
High Court
Appearances
:
Applicant:
Mr
M Seale SC
Mr
SG Fuller
Instructed
by:
Bernard Vukic Potash & Getz
Respondent:
Mr
R McClarty SC
Mr
M Aggenbach
Instructed
by:
Heyns & Partners
[1]
The written agreement was concluded in the Afrikaans language. This
English translation is provided and accepted by the parties.
[2]
Devonia
Shipping Limited v MV Luis (Yeoman Shipping Company Limited)
1994
(2) SA 363
(C), at 369F – I.
[3]
Godongwana
v Mpisana
1982
(4) SA 814
(TkSC) at 817C-D.
[4]
BHT
Water Treatment (Pty) Ltd v Leslie and Another
1993
(1) SA 47
(W) at 55A-F;
Oasis
Group Holdings (Pty) Ltd and Another v Bray
[2006]
4 All SA 183
(C) (“Oasis Group”) para 13.
[5]
Minister
of Law and Order, Bophuthatswana and Another v Committee of the
Church Summit of Bophuthatswana and Others
1994 (3) SA 89
(BG) (“
Committee
of the Church Summit
”
)
at 97G.
[6]
Zuurbekom
Ltd v Union Corporation Ltd
[1947]
1 All SA 319
(A) at 341-342.
Oasis
Group,
para
13.
[7]
Setlogelo
v Setlogelo
1914
AD 221
at 227.
[8]
Committee
of the Church Summit
at
98D.
[9]
Id. See also:
LAWSA
Vol. 11, 2
nd
Ed.
397.
[10]
Plascon-Evans
Paint Ltd v Van Riebeck Paints (Pty) Ltd
[1984]
ZASCA 51
;
1984 (3) SA 623
(A) (Plascon Evans) at 634E-635C.
[11]
Commercial
Stevedoring Agricultural and Allied Workers' Union and Others v Oak
Valley Estates (Pty) Ltd and Another
(CCT
301/20)
[2022] ZACC 7
;
[2022] 6 BLLR 487
(CC);
2022 (7) BCLR 787
(CC);
2022 (5) SA 18
(CC) (1 March 2022) para 19;
National
Council of Societies for the Prevention of Cruelty to Animals v
Openshaw
[2008]
ZASCA 78
;
2008 (5) SA 339
(SCA) at para 20.
[12]
V &
A Waterfront Properties (Pty) Ltd and another v Helicopter &
Marine Services (Pty) Ltd and Others
[2006]
3 All SA 523
(SCA) (“
V
& A Waterfront
”
)
, at para 21;
Exxaro
Coal Mpumalanga (Pty) Ltd v TDS Projects Construction and Newrak
Mining JV (Pty) Ltd and Another
[2022]
JOL 53514
(SCA) , at paras 13-14;
Reddy
v Siemens Telecommunications (Pty) Ltd
[2006] JOL 18829
(SCA)
(“
Reddy
”
),
para 22;
Masstores
(Pty) Ltd v Pick n Pay Retailers (Pty) Ltd
2017
(2) BCLR 152
(CC), para 8 and 101-103;
Oasis
Group Holdings,
para
36 – 37;
National
Commissioner Of The South African Police Services and Another v
Forensic Data Analysts (Pty) Ltd and Another
(24570/2018)
[2019] ZAGPPHC 6; 2019 BIP 215 (GP) (30 January 2019) (“
Forensic
Data Analysts
”
),
paras 61 – 64;
Harmony
Golf Mining (Pty) Ltd and Others v Lejweleputswa
Community Engagement Structure and Others
(502/2023)
[2023] ZAFSHC
193
(18 May 2023) (“
Harmony
Golf Mining
”
),
para 19;
Khumalo
v Master of High Court Johannesburg and Another
(2023/095270) [2023]
ZAGPJHC 1158 (9 October 2023), paras 16 -19.
Boardwalk
Trading 175 CC v City of Ekurhuleni Metropolitan Municipality and
Another
(2023/101032)
[2023] ZAGPJHC 1163 (16 October 2023), paras 25 – 26;
Eastern
Produce Estates SA (Pty) Ltd v Wales Communal Property Association
and Others
(LCC
201/2015)
[2018] ZALCC 4
;
2018 (4) SA 220
(LCC);
[2018] 3 All SA 123
(LCC) (4 April 2018), para 71.
[13]
V &
A Waterfront,
paras
20 – 22;
Oasis
Group Holdings,
paras
36 – 37;
Forensic
Data Analysts,
paras
62 – 64;
Harmony
Golf Mining,
paras
18-19.
[14]
Free
State Gold Areas Ltd v Merriespruit (Orange Free State) Gold Mining
Co Ltd and Another
1961
(2) SA 505
at 518;
Committee
of the Church Summit
,
at 99A;
Minister
of Law and Order and Others v Nordien and Another
[1987] ZASCA 24
;
[1987] 2 All SA 164
(A)
(Nordien), at page 165.
[15]
Committee
of the Church Summit
,
at 99B.
[16]
Id, at 99C; Nordien, at page 165.
[17]
Id.
[18]
Committee
of the Church Summi
t,
at 99F.
[19]
Id, at 99G.
[20]
Id, at 99H.
[21]
South
Atlantic Islands Development Corporation Ltd v Buchan
1971 (1) SA 234
(C) at
239G.
[22]
Crofter
Hand Woven Harris Tweed Co Ltd v Veitch
[1941]
UKHL 2
,
[1942] AC 435.
Kuwait
Oil Tanker Company SAK & Anor v Al Bader & Ors
[2000]
EWCA Civ 160
(18 May 2000).
[23]
British Midland Tool Ltd v Midland International Tooling Ltd &
Ors
[2003] EWHC 466
(Ch) (12 March 2003) (Midland).
[24]
Midland
,
at para 77.
[25]
Rather
than a conspiracy to injure by
lawful
means.
See Kuwait Oil Tanker Company SAK & Anor v Al Bader & Ors
[2000] EWCA Civ 160
(18 May 2000) (Kuwait), at paras 107-108, where
the distinction is described.
[26]
Midland
,
para 77;
Kuwait
,
paras 108-110.
[27]
Cf. Kuwait, para 132.
[28]
Strike
Productions (Pty) Ltd v Bon View Trading 131 (Pty) Ltd & Others
[2011]
JOL 26664
(GSJ) (“
Strike
Productions
”
),
at paras 17, 22-24, 34-35.
Hirt
& Carter (Pty) Ltd v Mansfield and another
[2007]
4 All SA 1423
(D), at paras 56-58;
Petre
& Madco (Pty) Ltd t/a T-Chem v Sanderson-Kasner and Others
[1984]
4 All SA 171
(W), at page 178. In the English case of
QBE
Management Services (UK) Ltd v Dymoke & Ors
[2012]
EWHC 80
(QB) (27 January 2012), at paras 200-201, the court
indicated that
an
applicant
must
particularize the confidential information in order to allow the
court to determine that there is indeed a protectable interest.
[29]
Strike
Productions
,
at paras 22 - 23.
[30]
Commercial Stevedoring Agricultural and Allied Workers' Union and
Others v Oak Valley Estates (Pty) Ltd and Another (CCT 301/20)
[2022] ZACC 7
;
[2022] 6 BLLR 487
(CC);
2022 (7) BCLR 787
(CC);
2022
(5) SA 18
(CC) (1 March 2022), at para 39.
[31]
Id, para 42.
[32]
Barclay
Pharmaceuticals Ltd & Ors v Waypharm LP & Ors
[2012] EWHC 306
(Comm)
(28 February 2012), at para 222;
Kuwait
,
at para 110 and 133;
Roche
Diagnostics Ltd against Greater Glasgow Health Board and Another
[2024] ScotCS CSOH_55
(05 June 2024), at paras 95-97.
[33]
Kuwait
,
at para 133.
[34]
Nedcor
Bank Ltd t/a Nedbank v Lloyd-Gray Lithographers (Pty) Ltd
[2000]
4 All SA 393
(A), at para 10, where this concept was described as,
in contrast with concurrent wrongdoers: ‘Joint wrongdoers are
persons
who, acting in concert or in furtherance of a common design
,
jointly
commit a delict.’
[35]
McKenzie
v Van der Merwe
1917
AD 41
(AD), at page 45 and 47.
[36]
See:
Motion
Transfer & Precision Roll Grinding CC v Carsten and Another
[1998]
4 All SA 168
(N) (“
Motion
Transfer
”
),
at pages 176 – 178.
Aranda
Textile Mills (Pty) Ltd v Hurn and Another
[2000]
4 All SA 183
(E), at paras 23 - 33.
Strike
Productions
paras
25-31;
Knox
D’Arcy Ltd and Others v Jamieson and Others
[1992] 4 All SA 275
(W)
(“
Knox
D’Arcy
”
),
at pages 279 – 282.
[37]
Van
Heerden& Neethling
Unlawful
Competition
2
nd
ed
(2008), pages 296 – 297.
[38]
Unilever
Bestfoods Robertsons and Others v Soomar and Another
2007
(2) SA 347
(SCA) para 7.
[39]
Id, para 11.
[40]
National Director of Public Prosecutions v Zuma (573/08)
[2009]
ZASCA 1
;
2009 (2) SA 277
(SCA);
2009 (1) SACR 361
(SCA);
2009 (4)
BCLR 393
(SCA);
[2009] 2 All SA 243
(SCA) (12 January 2009) para 26.
[41]
National Council of Societies for the Prevention of Cruelty to
Animals v Openshaw (462/07)
[2008] ZASCA 78
;
[2008] 4 All SA 225
(SCA);
2008 (5) SA 339
(SCA) (30 May 2008) at para 20.
[42]
See also:
Tau
v Mashaba and Others
[2020]
ZASCA 26
;
2020 (5) SA 135
(SCA) at para 26;
Stauffer
Chemicals Chemical Products Division of Chesebrough-Ponds (Pty) Ltd
v Monsanto Company
[1988]
3 All SA 279
(T), at page 282.
[43]
See also:
Phillip
Morris Inc v Marlboro Trust Co SA
1991
(2) SA 720
(A) at 735B.
[44]
United
Democratic Movement and Another v Lebashe Investment Group (Pty) Ltd
and Others
(CCT
39/21)
[2022] ZACC 34
;
2022 (12) BCLR 1521
(CC);
2023 (1) SA 353
(CC) (22 September 2022) (“
United
Democratic Movement”
),
at para 48.
[45]
S v Baloyi and Others (CCT29/99)
[1999] ZACC 19
;
2000 (1) BCLR 86
;
2000 (2) SA 425
(CC) (3 December 1999).
[46]
Id, at para 17. See also:
United
Democratic Movement
,
at para 48.
[47]
Africa
Parts Group Holdings (Pty) Ltd and Others v Titan Auto Parts (Pty)
Ltd and Others
(20/39009)
[2022] ZAGPJHC 8; 2022 BIP 554 (GJ)(“
Africa
Parts Group”
)
.
[48]
Id, at para 68.
[49]
Knox D’Arcy, pages 282-283; See also:
Africa
Parts Group
),
at paras 66-67.
[50]
Meter
Systems Holdings Ltd v Venter and Another
[1993]
3 All SA 574
(W) (“
Meter
Systems
”
),
at pages 590 – 593 (particularly paragraph 10.3);
Packaging
& Stapling CC v Fromm System Africa and Others
(966/2010) [2010]
ZAECPEHC 80 (23 November 2010) (“
Packaging
& Stapling
”
),
at paras 17-18;
Knox
D'Arcy
,
at pages 226 – 227; Cf.
Harvey
Tiling Co (Pty) Ltd v Rodomac (Pty) Ltd and Another
[1977] 1 All SA 481
(T)
(“
Harvey
Tiling
“
)
, at pages 486 – 492.
[51]
Meter
Systems
at
pages 590 – 593 (particularly paragraph 10.3);
Packaging
& Stapling,
paras
17 - 18.
Knox
D'Arcy,
at
pages 226 – 227;
Harvey
Tilin
g,
at pages 486 – 492.
[52]
Africa
Parts Group
at
paras 65 – 68;
Multi
Tube Systems (Pty) Ltd v Ponting and Others
[1984]
3 All SA 578
(D) (“
Multi
Tube Systems
”
),
at pages 584 – 586;
Valunet
Solutions Inc dba Dinkum USA & another v eTel Communication
Solutions (Pty) Ltd
[2005]
JOL 13595
(W) (“
Valunet
Solutions
”
)
paras 15 – 17;
Big
Catch Fishing Tackle proprietary Limited and Others v Kemp and
Others
(17281/18)
[2019] ZAWCHC 20
(5 March 2019) (“
Big
Catch
”
)
para 44;
Meter
Systems,
at
pgs 593 (para 10.3);
Knox
D’Arcy
,
at pages 281-282;
SD
Noorgat Trading Enterprise CC t/a Powertrade Cash and Carry (Focus
Group) v Mahomed
(1179/21P)
[2022] ZAKZPHC 2 (28 January 2022) (“
SD
Noorgat
”
),
at paras 44-45, 56, 77 & 80.
[53]
Id.
[54]
Spieth
and another v Nagel
[1998]
JOL 1320
(W) (“
Spieth
”
).
[55]
Thus,
at page 17, the court in
Spieth
states:
‘
.
. .
I
accordingly find that a director's fiduciary duty can survive the
termination of his directorship and that there is no
reason in
principle why in an appropriate case a company should not, while
such duty survives, be protected by way of an interdict
from an
irreparable loss it may otherwise suffer if the director, following
his resignation, is allowed to continue to exploit
a commercial
opportunity created in breach of his fiduciary duty. To afford such
protection must accord with public policy and
the boni mores of the
commercial community. To do so is not to punish the delinquent
director for his past misconduct but to
secure the cessation of an
unlawful course of conduct which after all is the object of an
interdict (see Press The Law of Interdicts
page 42).’
[56]
Multi
Tube Systems),
at
pages 582 – 584;
Valunet
Solutions
paras
9, 15 -17;
Taskflow
(Pty) Ltd v Aluxium (Pty) Ltd and Others
(2021/41676) [2021]
ZAGPPHC 604 (21 September 2021), at para 25;
SD
Noorgat,
paras
9, 44-45, 56-57, 60, 65, 69, 77;
Big
Catch,
para
46.
[57]
See:
V
& A Waterfront
,
at paras 19 – 22;
Exxaro
Coal Mpumalanga
,
at para 13-14.
Reddy,
at
para
22; Masstores, at paras 8 and 101-103;
Oasis
Group Holdings, paras
36
– 37;
Forensic
Data Analysts,
paras
61 – 64;
Harmony
Golf Mining,
para
19;
Khumalo
v Master of High Court Johannesburg and Another (2023/095270) [2023]
ZAGPJHC 1158 (9 October 2023)
,
paras 16 -19;
Boardwalk
Trading 175 CC v City Of Ekurhuleni Metropolitan Municipality and
Another
(2023/101032)
[2023] ZAGPJHC 1163 (16 October 2023), paras 25 – 26;
Eastern
Produce Estates SA (Pty) Ltd v Wales Communal Property Association
and Others
(LCC
201/2015)
[2018] ZALCC 4
;
2018 (4) SA 220
(LCC);
[2018] 3 All SA 123
(LCC) (4 April 2018), para 71.
[58]
V &
A Waterfront
,
at paras 19 – 22;
Oasis
Group Holdings,
para
36 – 37.
Forensic
Data Analysts,
paras
62 – 64.
Harmony
Golf Mining,
paras
18-19.
[59]
Reddy
,
at para 22.
[60]
Cf.
Oasis
Group Holdings,
para
35 – 37.
[61]
Oslo
Land Co Ltd v The Union Government
1938
A.D. 584
at 590 – 593.
[62]
Strike
Productions
paras
17, 22-24, 34-35;
Alum-Phos
(Proprietary) Limited v Spatz and another
[1997]
1 All SA 616
(W) (“
Alum-Phos
”
)
at page 623;
Hirt
& Carter (Pty) Ltd v Mansfield and another
[2007]
4 All SA 1423
(D), at paras 56-58;
Petre
& Madco (Pty) Ltd t/a T-Chem v Sanderson-Kasner and Others
[1984]
4 All SA 171
(W), at page 178.
[63]
Motion
Transfer
,
at page 175;
Alum-Phos
at page 623.
[64]
Triomed
(Pty) Ltd v Beecham Group PLC and others
[2001] 2 All SA 126
(T)
,
at page 159;
Valunet
Solutions
,
at para 17. In the English case of
QBE
Management Services (UK) Ltd v Dymoke & Ors
[2012] EWHC 80
(QB) (27
January 2012), at para 247, the court indicated that an applicant
bears the burden of spelling out the precise nature
and period of
its competitive advantage.
[65]
Vestergaard Frandsen
A/S & Ors v Bestnet Europe Ltd & Ors
[2009] EWHC 1456
(Ch)
(26 June 2009).
[66]
Id, at para 93.
sino noindex
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