Arwyp Meical Centre (Pty) Ltd v Busamed Modderfontein Private Hospital RF (Pty) Ltd and Others (20785/2016) [2016] ZAGPJHC 201 (15 July 2016)

REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG LOCAL DIVISION, JOHANNESBURG

CASE NO: 20785/2016

In the matter between:

ARWYP MEDICAL CENTRE (PTY) LTD First

Applicant

And

BUSAMED MODDERFONTEIN PRIVATE HOSPITAL RF (PTY) LTD First Respondent

THE DEPARTMENT OF HEALTH, GAUTENG Second

Respondent

HEAD OF DEPARTMENT OF HEALTH, GAUTENG Third

Respondent

Judgment

Van der Linde, J:

[1] This is an urgent application for an interim interdict restraining the first respondent from commencing business operations as a private healthcare hospital. The subjunctive event is either the obtaining by the first respondent of an appropriate licence or, if the first respondent already has that, the taking of appropriate steps to set it aside, whether an appeal or review.

[2]The second and third respondents abide. Having regard to how the submissions developed the central issue, in my view, is whether the applicant as shown a threatened infringement of a right which it has. There are of course also other issues in the matter, such as whether in fact the applicant has any substantive right in the first place, as opposed to merely a right to be heard to object to a license being granted. Since the application can in my view be decided on the first issue alone, it is unnecessary to delve any further.

[3] The applicant is the owner of a hospital. The first respondent is also the owner of a hospital, but brand new, in the process of being completed. Once completed and up and running, the first respondent’s hospital will conduct its business in competition to that of the applicant. The applicant contends that the first respondent does not have the required licence lawfully to conduct the hospital business, and but despite this handicap has announced on social media platforms that it intended opening its doors to conduct the business on 1 July 2016. The first respondent has also already lured of the applicant’s staff to leave it and to join the first respondent instead.

[4] The applicant submits that it has a right, enforceable against the first respondent, to insist that the first respondent only conducts its business lawfully, because the applicant falls within the class of persons for whom the relevant regulations were made that regulate lawful conducting of the business of a hospital. For this contention it relies on Patz v Greene & Co, 1907 TS 427 and the consultative scheme in the current regulations whereby it as interested party may object to the granting of a licence to the first respondent; and for the entitlement to pursue an internal appeal if the licence were awarded to the first respondent over its objections.

[5] The applicant therefore argues that either the first respondent has no right to commence conducting the business of a hospital; or if it has a right, then it wishes to challenge the award of that right, and in the meantime the first respondent should be interdicted from conducting the hospital business.

[6]First though it is necessary to define the hypothesis: it is that the applicant has a right, the threatened infringement of which is sought to be prevented or interdicted, to prevent the first respondent from acting contrary to a statutory prescription. It is important to appreciate that it is the prevention of unlawful conduct which is the object of the right; and not the prevention of mere competition, for that is not only lawful but to the contrary in the public interest.

[7]For the applicant to show an infringement, or a threatened infringement, the applicant accordingly has to show that, on the evidence, there is a reasonable prospect that the first respondent will conduct the business without a licence. It is whether this requirement has been met that now focusses our attention.

[8]The first consideration here is that the applicant does not contend that the construction of the premises is unlawful as it stands. If that were so, an interdict could, on the applicant’s case, have been obtained long ago. It is the anticipated conducting of the business, once the premises have been completed and the equipment installed, that is said likely to be undertaken without a licence. But what are the facts?

[9]The applicant does not point to past unlawful conduct by the first respondent; in fact, the applicant expressly eschews it. This was pertinently raised with the applicant, in view of the decision given by default on 26 July 2011 in the Gauteng Provincial Division of the High Court. But the first respondent was not a party to that judgment, and although there might have been scope for an alter ego argument to be raised, considering the position of Dr Mji, that was expressly not done. The applicant expressly rests with the first respondent’s conduct in this very matter, and points in this regard to the advertisements on social media platforms to the effect that the business is about to be opened.

[10]But on its own that proposition is not good enough. It is only good enough if the proposition could be advanced that the advertisements

are that the business would be conducted without a licence. But of course they do not say that. For the applicant to succeed, that would have to be inferred. And since the applicant cannot, nay expressly does not, point to past conduct from which to infer it, nothing really remains to justify that inference.

[11]The applicant is confronted by an added problem. It is that the first respondent has expressly undertaken that it will not conduct the hospital business without being lawfully licenced to do so. In argument the first respondent pertinently relied on National Council of the SPCA v Openshaw, [2008] ZASCA 78; 2008 (5) SA 339 (SCA) for the proposition that such an undertaking is generally destructive of the inference that unlawful conduct is likely to occur. The applicant declined the undertaking because it did not feel comfortable with it. One fully appreciates a litigant who, faced with an empty undertaking, declines to accept it. But then that must be the case of the litigant: that the undertaking is not credible.

[12]It is actually necessary to spell it out in those crass terms, because it is only then that the opposing litigant knows what it is up to, and that it should garner the evidence, if it is available, to meet the case. That was not done here. In these circumstances the conclusion is unavoidable that the applicant failed to make out a case that any of its rights are the subject of a threatened

infringement.

[13]Concerning costs, in my view the employment of two counsel was a reasonably prudent precaution in the circumstances of this case, given the commercial stakes involved.

[14]In the result I make the following order:

(a) The application is dismissed with costs, including the costs of two counsel.

WHG van der Linde

Judge, High Court

Johannesburg

For the applicant: Adv. E.L. Theron, SC

Instructed by: Bouwer Cardona Attorneys

59-7th Avenue, Parktown

Tel: 011 759 0940

Ref: Ms Labuschagne/sk/w27/1568

For the first respondent: Adv. K. Tsatsawane

Adv. K. Ramaimela

Instructed by: Cliffe Dekker Hofmeyr Attorneys

1 Protea Place

Sandton

Tel: 011 562 1331

Ref: T Furmann/M Mphafudi/2197056

Date argued: 12 July 2016

Date of judgment: 15 July 2016