California Nails Pretoria East (Pty) Ltd v Adeyemi and Others (126746/2024) [2024] ZAGPPHC 1219 (27 November 2024)

REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

Case Number: 126746/2024

(1) REPORTABLE: YES/NO

(2) OF INTEREST TO OTHER JUDGES: YES/NO

(3) REVISED: YES/NO

DATE:2711/2024

SIGNATURE:

In the matter between:

CALIFORNIA NAILS PRETORIA EAST (PTY) LTD Applicant

and

SAMSON ADEYEMI

First Respondent

TAMMY TAYLOR GLOBAL FRANCHISING

Second Respondent

PETRUS VILJOEN

Third Respondent

METROPROP (PTY) LTD

Fourth Respondent

JUDGMENT

WENTZEL AJ

Introduction

[1] This is an application brought by way of urgency interdicting and restraining the first respondent from interfering with the business operations of the applicant trading as Tammy Taylor Parkview (“the business”) situated at the Parkview Shopping Centre in Pretoria, which it alleges it purchased from the first respondent’s agent, the second respondent, duly represented by the third respondent.

[2] The applicant also seeks a declarator in terms of prayer 4 of the notice of motion in terms of section 21(1)(c) of the Superior Courts Act 10 of 2013 (“the Superior Courts Act”) that a valid sale agreement in respect of the business was concluded, entitling it further to an order (sought under prayer 5 of the notice of motion) compelling the first, second and third respondents to transfer of all rights attached to the business into the name of the applicant. The second and third respondents consent to this relief in a letter from their attorney dated 5 November 2024 attached to the replying affidavit.

[3] In addition, the applicant seeks an order in terms of prayer 6 of the notice of motion directing the third respondent, or any person instructed by him, to restore the applicant’s access to the Instagram account operated in the name of the business (which it alleges was deactivated on 3 November 2024) and to confirm in writing that this has been done. The second and third respondent have, through their attorney, denied that they have any control over this Instagram account.

[4] No relief is sought against the fourth respondent who is cited solely because it is responsible for the management of shopping centre at which the business is situated and collects the rental payments owing by the tenants to the owner of the shopping centre.

Background facts

[5] Lerato Maphike (“Maphike”) explains in her founding affidavit that she is involved in the beauty business and initially wished to purchase a licence to run a California Nails franchise owned by California Nails (Pty)Ltd (“California Nails”). To this end, Maphike states that she formed a company, California Nails Pretoria East (Pty)Ltd (the applicant), through which to run a California Nails franchise business.

[6] After experiencing considerable delays in setting up the California Nails franchise business, Petrus Viljoen (“Viljoen”), who is the third respondent and was the director in control of a competing franchisor, Tammy Taylor Global Franchising (“TTGF”) (the second respondent), suggested that Maphike purchase a Tammy Taylor franchise business situated at the Parkview Shopping Centre in Pretoria as a going concern instead.

[7] Viljoen informed Maphike and her husband, Siphiso Ngema (“Ngema”) that he had a mandate to sell the business and agreed to sell the business as a going concern to the applicant on behalf of the undisclosed owner for R1.5 million, inclusive of the licence fee of R300 000 owing to TTGF for the franchise.

[8] In terms of the written agreement of sale concluded on 6 May 2024 between the applicant, represented by Ngema, and TTGF, represented by Viljoen: (a) An amount of R500 000 was payable by the applicant to TTGF by the end of the day on 6 May 2024, plus the licence fee of R300 000; (b) It was agreed that Maphike would operate the business on a trial basis for 60 days, whereafter she would decide whether to purchase the business;(c) Should Maphike decide to purchase the business, the balance of R700 000 owing would be payable once the lease for the premises was transferred to the applicant, failing which TTGF would resell the business and refund the total amount of R850 000 (in fact R800 000) paid by the applicant back to the applicant; and (e) During the 60-day trial period, the profits and loss for the business would be for the applicant’s account (“the sale agreement”).

[9] Acting pursuant to the sale agreement, payment of the amount of R500 000 was made by the applicant to TTG and R300 000 was paid to California Nails (Pty) Ltd on 6 May 2024. It is unclear why Viljoen instructed Maphike to pay the agreed licence fee to California Nails when the licence fee owing would have been payable to the second respondent as the owner of the Tammy Taylor franchise.

[10] Maphike took possession of the salon on 7 May 2024. After the expiry of the trial period, Maphike informed Viljoen that she wished to proceed with the purchase. Notwithstanding the terms of the sale agreement, Viljoen insisted that the balance owing in the amount of R700 000 be paid to TTGF in order to transfer the lease in respect of the business premises to the applicant. The applicant accordingly made payment of the balance of R700 000 to TTGF in two tranches, the first in the amount of R500 000 (which

was paid on 2 July 2024) and the second in the amount of R200 000 (which was paid on 4 July 2024).

[11] Maphike states that since acquiring control of the business, Samson Adeyemi (“Adeyemi”), who, through his company, ASO Services (Pty) Ltd (“ASO”) owned the business sold, has been attending at the business premises and demanding payment and/or proof of payment of the moneys owing in respect of the sale of the business and threatening to close the business should payment not be made. True to his word, on 16 October 2024, Adeyemi forcefully closed the business. In an email sent to Ngema on the same date, Adeyemi stated that he would open the premises again on 17 October 2024 and permit the applicant to continue to trade but, unless Viljoen made payment to him in respect of the sale of the business, he would be retaking possession of the business as from 1 November 2024.

[12] On the same date, 16 October 2024, Adeyemi instructed his attorneys to address correspondence to Viljoen and TTGF on behalf of ASO demanding payment in the amount of R850 000 for the sale of the business, failing which he would take repossession of the business.

[13] On 24 October 2024, the applicant’s attorneys addressed a letter to Adeyemi in which they demanded that that he immediately cease and desist from interfering with the applicant’s business. On the same date, the applicant’s attorneys addressed correspondence to Viljoen recording that Viljoen had insisted that the balance of R700 000 owing in respect of the business be paid to TTGF before he would transfer the lease to the applicant and demanding that he ensure that the lease to the business premises was transferred to the applicant.

[14] Viljoen did not make any payments to Adeyemi; nor did he take any steps to transfer the lease in respect of the business premises to the applicant.

[15] As Adeyemi had not received payment from TTGF or Viljoen, he forcefully took control of the business premises on 1 November 2024 and instructed the fourth respondent, Metroprop (Pty) Ltd (“Metroprop”) to lock the premises. This act of spoliation caused the applicant to bring the current proceedings on an urgent basis. Of concern is that Adeyemi’s attorneys admitted being aware that their client could not do this without a court order but justified their client’s threat on the basis that there were only six weeks left before the courts went on recess for the festive season, and thus the chances of their client’s matter being heard this year to obtain a court order were “close to impossible.” This was not an excuse for not approaching the court for relief and advising their client to take the law into his own hands which they knew was unlawful.

The disputes of fact raised by the first respondent

[16] In these proceedings, Adeyemi denied he had given TTGF a mandate to sell the business and that he had any prior knowledge of the sale of his business to the applicant. It was argued by the Viljoen’s counsel that Adeyemi had merely proposed that TTGF market and find a buyer for the business, but this had not constituted a valid mandate as it was only signed by Adeyemi and had

not been signed by Viljoen.

[17] It is trite, however, that a mandate agreement need not be in writing and may be express or or tacit (Novartis SA (Pty) Ltd v Maphil Trading (Pty) Ltd 2016 (1) SA 518 (SCA) para 46 ff.)

[18] The authority of the agent to perform a juristic act on behalf of the principal is derived from the unilateral juristic act of authorisation by the principal empowering another to act on his/her behalf (De Wet & Van Wyk Kontraktereg 110; Maasdorp v Mayor of Graaff-Reinet 1915 CPD 636 at 639.). As authorisation is a unilateral act and is not an agreement, it does not require acceptance by the person being authorised (1 LAWSA ‘Agency’ para 139). It was thus not necessary for Viljoen to have signed the mandate conferred on TTGF by ASO.

[19] It was, however, argued in the alternative that even if the alleged mandate was valid, it did not entitle Viljoen or TTGF to sell the business on his behalf. It was argued that it was contemplated that should a prospective buyer be found who was willing to purchase the business, a written offer to purchase would have had to be made by the prospective purchaser to ASO and if Adeyemi was amenable to its terms, he would have had to sign the offer to purchase himself on behalf of ASO before a valid sale could be concluded. It was denied that Viljoen had a mandate to actually conclude a contract for the sale of ASO’s business to a prospective purchaser.

[20] In support of this argument, Adeyemi’s counsel quoted from an article written by Professor E. Kahn published in the South African Law Journal ((1980) 97 SALJ 324) in which he distinguished between estate agents and other agents “stricto sensu”. The passage quoted does not assist Adeyemi but serves to confirm that, unlike estate agents of immovable property where the agent is merely entrusted with the task of finding a purchaser and are not “clothed with the authority to enter into a contract on behalf of the principal”, an agent stricto sensu is indeed clothed with authority to enter into a contract on behalf of his principal. As will become apparent hereunder, the terms of the mandate agreement concluded between TTGF and ASO were such that Adeyemi in fact granted TTGF a mandate to sell ASO’s business.

[21] The proper approach to factual disputes where final interdictory relief is sought is set out by Corbett JA in the well-known matter of Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd [1984] ZASCA 51; 1984 (3) SA 623 (A) at 634E – 635D as follows:

“In such a case the general rule was stated by VAN WYK J (with whom DE VILLIERS JP and ROSENOW J concurred) in Stellenbosch Farmers' Winery Ltd v Stellenvale Winery (Pty) Ltd 1957 (4) SA 234 (C) at 235E - G, to be:

"... where there is a dispute as to the facts a final interdict should only be granted in notice of motion proceedings if the facts as stated by the respondents together with the admitted facts in the applicant's affidavits justify such an order... Where it is clear that facts, though not formally admitted, cannot be denied, they must be regarded as admitted."

…

It seems to me, however, that this formulation of the general rule, and particularly the second sentence thereof, requires some clarification and, perhaps, qualification. It is correct that, where in proceedings on notice of motion disputes of fact have arisen on the affidavits, a final order, whether it be an interdict or some other form of relief, may be granted if those facts averred in the applicant's affidavits which have been admitted by the respondent, together with the facts alleged by the respondent, justify such an order. The power of the Court to give such final relief on the papers before it is, however, not confined to such a situation. In certain instances the denial by respondent of a fact alleged by the applicant may not be such as to raise a real, genuine or bona fide dispute of fact …If in such a case the respondent has not availed himself of his right to apply for the deponents concerned to be called for cross-examination under Rule 6 (5) (g) of the Uniform Rules of Court …and the Court is satisfied as to the inherent credibility of the applicant's factual averment, it may proceed on the basis of the correctness thereof and include this fact among those upon which it determines whether the applicant is entitled to the final relief which he seeks … Moreover, there may be exceptions to this general rule, as, for example, where the allegations or denials of the respondent are so far-fetched or clearly untenable that the Court is justified in rejecting them merely on the papers ...”

[22] It appears from the averments made by Adeyemi himself in his answering affidavit and the documents attached to the papers in this matter that Adeyemi’s denial of the mandate provided to TTGF and the validity of the sale concluded by Viljoen on behalf of ASO with the applicant may be rejected on the papers as not being real, bona fide, genuine and/or so far-fetched to be clearly untenable as contemplated in Plascon Evans. I say this for the following reasons:

a. On 13 April 2024, Adeyemi granted a mandate to TTGF (as the franchisor) to sell ASO’s business (as the franchisee) on the terms proposed by Viljoen in a document prepared by Viljoen on 12 April 2024 and accepted by Adeyemi by his signature of the proposed mandate on 13 April 2024 (“the mandate”).

b. In terms of the mandate, it was agreed that:

i. TTGF, represented by Viljoen, would take control of the Parkview Franchise on 15 April 2024 and would run the franchise for its own loss or profit from the date of takeover.

ii. The purpose of the takeover by the franchisor, TTGF, was to assist the franchisee, ASO, to sell the franchise and give the franchisee R850 000.

iii. After takeover of the salon, the franchisor would market and promote the salon.

iv. The franchisor had a maximum of 6 months to find a purchaser, failing which the franchisor was entitled to take ownership of the salon, and pay the franchisee an initial payment of 50% of the agreed value, whereafter the franchisor would be obliged to pay R150 000 per month to the franchisee until the full purchase price was paid.

v. During this six-month period, the franchisor agreed to supply stock as needed, but would deduct the stock invoices from the purchase price of the business.

vi. The franchisor also agreed to pay for production, content creation and to pay for influencers to promote the salon at risk which would only be deducted from the purchase price should the franchisee cancel the mandate agreement.

vii. The franchisee agreed to pay for three pole adds to promote “the R350 special”.

viii. The franchisor undertook to pay all expenses incurred by the business from the date of transfer and to provide proof to the franchisee that the rent was paid in time.

c. It is implicit from the mandate that Adeyemi, acting on behalf of ASO, gave Viljoen, acting on behalf of TTGF, a six-month mandate to sell the business for not less than R850 000, which was payable by TTGF, and not the purchaser, on the sale of the business. This in and of itself contemplates that TTGF could sell the business on behalf of ASO and accept payment of the agreed sale price from the purchaser on behalf TTGF. Should Viljoen not be able to sell the business within the six-month mandate period, it was agreed that TTGF would itself acquire the business at an agreed value, fifty percent of which would be payable upfront, with the balance being payable in instalments in the amount of R150 000 per month until the outstanding balance had been settled in full. Should this not be implicit from the terms of the mandate, it certainly constitutes a proper contextual construction of

the mandate as contemplated in Natal Joint Municipal Pension Fund v Endumeni Municipality 2012 (4) SA 593; [2012] ZASCA 13 (SCA).

d. It is moreover clear from the terms of the mandate that as from the date of transfer of the business to TTGF, TTGF assumed responsibility for the rental for the business premises. Although Adeyemi disputes the validity of the mandate, no payments towards the rental owing were made by either Adeyemi or ASO to Metroprop after April 2024. Although Adeyemi alleges in his supplementary affidavit he ceased paying the rental due to financial constraints, in all probability, Adeyemi ceased making payments towards the rental after April 2024 as he had relinquished control of the premises to TTGF on 13 April 2024 following the conclusion of the mandate and understood that should a purchaser not be found willing to purchase the business for an amount of R850 000 within six months, TTGF would itself purchase his business for an agreed value. A purchaser was found and indeed, from 1 July 2024, the applicant and not ASO has been making payments towards the rent for the business premises to Metroprop (although as at 18 November 2024, there was a balance outstanding of R47 400.03 which it has claimed from ASO).

e. Adeyemi’s conduct since conferring the mandate on TTGF is also consistent with his acceptance of its terms. On realising that Maphike was occupying and conducting a Tammy Taylor Parkview franchise from the premises, Adeyemi states that he instructed his attorneys to engage with Viljoen and to send a letter of demand to TTGF. Neither the date of this demand nor a copy thereof was attached to the answering affidavit. It is, however, suspected that it was prefaced on the terms of the mandate denied by Adeyemi to be valid and that this demand has not been attached as it demonstrated that even at this early stage, Adeyemi accepted

that a valid sale of the business had been concluded and instructed his attorneys to demand payment of the amount of R850 000 from TTGF in terms of the mandate.

f. This is supported by the fact that on 28 July 2024, Adeyemi’s attorneys addressed correspondence to Maphike requesting proof of payment of the funds paid to Viljoen “for the purchase of the business situated at Parkview, Pretoria as a going concern previously owned by our client.” At this stage, Adeyemi clearly accepted that ASO’s business had been sold to Maphike by Viljoen, although he may not have known the identity of the company through which she had purchased the business.

g. Hereafter, Adeyemi instructed his attorneys to send a second letter of demand to TTGF and Viljoen, which they did on 31 July 2024. In this letter addressed to Viljoen, Adeyemi/ASO’s attorneys stated that they had been instructed by ASO to institute legal proceedings against TTGF and Viljoen for payment of the amount of R850 000 should payment not be received within 7 days of

receipt thereof.

h. Significantly in the letter of demand dated 31 July 2024, it was recorded that:

“Our client confirms that the shop has been sold to another business lady named Ms Lebo who confirms that she has been running the business for the past three months and has finalised the payments for the shop and you have been requesting to change lease agreements to be in her name.”

i. It was further recorded that:

“Our client further confirms that he has requested for payment numerous times however our client has not received its payment as agreed.”

j. The basis for the demand made by Adeyemi’s attorneys was thus clearly prefaced on the mandate signed by Adeyemi on 13 April 2024 and his acceptance of the validity of the sale agreement concluded with Maphike.

k. On 16 October 2024, Adeyemi’s attorneys addressed a further letter of demand to Viljoen and TTGF. This letter was referred to in Adeyemi’s attorneys’ letter dated 24 October 2024 but was not annexed to the answering affidavit. At the court’s request, it was addressed and annexed by Adeyemi to his supplementary affidavit. In this letter, Adeyemi’s attorney repeated the demand made in their letter of demand dated 31July 2024 referred to above, which had apparently been repeated in a further demand made on 8 August 2024 (also not annexed to Adeyemi’s affidavit). The 8 August 2024 demand was presumably also prefaced on the validity of the mandate provided to TTGF on 13 April 2024 and the validity of the sale of his business to Maphike. In the 16 October 2024 demand, Adeyemi’s attorneys stated that should payment of the amount of R850 000 not be forthcoming within two days of receipt thereof, their client “will be left with no option but to lock out the tenants currently operating in the shop and take back his shop to resume business.”

l. TTGF’s attorneys responded on 24 October 2024 and avoided entirely dealing with the demand for payment of the amount of R850 000 owed to ASO due to the sale of the business; instead, they focused on the fact that Adeyemi had forcefully taken control of the business on 15 October 2024 and thus that the threatened spoilation had already occurred. (In fact, according to the applicant, this had only occurred on 16 October 2024. Adeyemi in fact restored possession of the business to Maphike on 17 October 2024 and only shut her out of the business again on 1 November 2024 after no payment was forthcoming from TTGF or Viljoen for the sale of his business to the applicant.)

[23] Rather magnanimously, on 5 November 2024, TTGF and Viljoen’s attorney addressed correspondence to the applicant’s attorney stating that their clients consented to judgment in terms of prayers 4 and 5 of the notice of motion and would abide the decision of the Court regarding the remaining relief against the first respondent sought by the applicant. TTGF and Viljoen thus have no difficulty with the declaratory relief sought that the sale of the business by TTGF to the applicant was valid and that Adeyemi, TTGF and Viljoen be ordered to transfer all rights attached to the business to the applicant. Although the transfer of the lease into the applicant’s name is part and parcel with the relief sought in terms of prayer 5 of the notice of motion, neither

TTGF nor Viljoen have tendered to comply with their obligations in this regard in terms of the sale agreement; nor have they seen fit to make payment to Adeyemi or ASO of the agreed amount of R850 000 owing by TTGF to ASO in terms of the mandate agreement. This, notwithstanding that Viljoen’s attorneys stated that:

“It is our instruction that the purchase and sale of the relevant salon, by your client, was valid and that all rights in respect thereof has already be transferred to your client (sic). In fact, the Founding Affidavit in the aforementioned Urgent Application is replete with references that the Applicant have obtained ownership and control over the salon.”

[24] Whilst this court has some sympathy with Adeyemi’s frustration that Viljoen patently sold his business, did not tell him about it and, despite numerous demands, has failed to make payment of the agreed amount of R850 000 to ASO, he was not entitled to take the law into his own hands and forcefully take back his business from Maphike by precluding her from having access to the premises. The spoliation by Adeyemi was unlawful and the restoration of possession of the premises to the applicant was by definition urgent. Adeyemi plainly accepted that he had provided Viljoen with a mandate to sell his business and a valid sale agreement had been concluded by Viljoen with Maphike and/or her husband; his remedy lies against Viljoen and TTGF. It is also in his interests that he ensures that the lease in respect of the premises be transferred to the applicant to avoid his remaining liable for the

rental owing in respect of the premises.

[25] Importantly, even if the sale concluded between Viljoen, acting on behalf of TTGF, and the applicant were not valid in that it was not signed by Adeyemi on behalf of ASO, in terms of the mandate provided by ASO to TTGF on 13 April 2024, if after 6 months the business was not sold, it was contemplated that TTGF would take ownership of the business, who would pay the agreed value for the business. Thus, should the sale of the business to the applicant not prove valid, ownership of the business would not revert to ASO as with effect from 12 October 2024, Adeyemi agreed to sell ASO’s business to TTGF at the agreed value of the business. Accordingly, either way, he was not in law entitled to retake possession of his business from the applicant and his remedy would still lie against TTGF for payment of the agreed value and not the applicant. There is thus no purpose in an interim interdict being granted or a rule nisi being issued in this matter and I am satisfied that it is appropriate that final relief be granted. I am also prepared to grant the applicant final relief as no genuine dispute of fact exists that Viljoen, acting on behalf of TTGF, was not provided with a valid mandate by Adeyemi to sell ASO’s business.

[26] I am moreover satisfied that the applicant has established a clear right to be granted a final interdict against Adeyemi to desist from interfering with the applicant’s business. I am also satisfied that should this interdict not be granted the applicant will suffer irreparable harm and that the applicant has no alternative remedy.

[27] The applicant has also established that it has a clear right to the declaratory relief sought that a valid agreement for the sale of the business was concluded by Viljoen on behalf of TTGF and the applicant. I am thus also inclined to grant the consequential relief sought that the first, second and third respondent be directed to transfer all rights attached to the business to and into the name of the applicant. Although not explicitly claimed, this includes the right to transfer of the lease in respect of the premises from which the business is operated. The landlord, however, has not been joined to these proceedings and the lease agreement attached by Adeyemi to his answering affidavit precludes the sublease of the business premises or the cession of the rights to the lease agreement without the consent of the landlord. I thus make no order regarding the transfer of the lease in respect of

the business premises to the applicant but direct that the first, second and third respondent do all things necessary to secure the transfer the lease in respect of the business premises into the name of the applicant.

[28] Viljoen and TTGF have, through their attorney, denied having any access to or control over the Instagram account operated in the name of the business. No allegation was made by the applicant that Adeyemi or ASO have such access and control; nor was any order in this respect sought against either Adeyemi or ASO. Although no affidavit was submitted by Viljoen in these proceedings confirming that neither he nor TTGF have control over the Instagram account, the applicant’s attorney appears to have accepted the terms upon which Viljoen’s attorney agreed to consent to the orders against the second and third respondent and to abide the relief sought against the first respondent. As no consent was provided to the relief sought in prayer 6 of the Notice of Motion, this relief is not at this stage competent.

Costs

[29] No order for costs was sought in the notice of motion. However, I was asked to make a punitive order for costs against the first respondent as he had denied conferring a valid mandate to TTGF to sell his business; yet had relied on this mandate to demand R850 000 payment from TTGF. No order for costs was sought against the second and third respondent, although Viljoen had not taken any steps to transfer the lease in respect of the business premises into the applicant’s name and Viljoen’s failure to cause TTGF to make payment of the amount owing by it to ASO following the sale of ASO’s business to the applicant was the

catalyst for Adeyemi’s unlawful conduct and his seeking to regain possession of his business. This appears to be because the applicant’s attorney accepted the terms set out in Viljoen’s attorney’s letter dated 5 November 2024.

[30] Although this court in no way condones the unlawful conduct of Adeyemi and his untruthful denials in these proceedings, mulcting him with punitive costs when Viljoen and TTGF are not mulcted with any costs would be unfair and costs on a party and party scale B is sufficient an indication of the courts displeasure of his conduct in threatening and an harassing Maphike and in unlawfully depriving the applicant of access to the business premises and reassuming control of the business.

Order

[31] I accordingly make an order in the following terms:

a. That the first respondent be interdicted and restrained from interfering with the business operations of the applicant known as Tammy Taylor Parkview (“the business”) situated at the Parkview Shopping Complex/Centre (“the business premises”).

b. Declaring that there is a valid sale agreement in respect of the business from the ASO Services (Pty)Ltd to the applicant.

c. Directing the first, second and third respondent to transfer all rights attached to the business into the name of the applicant.

d. Directing the first, second and third respondent to do all things necessary to secure the transfer of the lease in respect of the business premises into the name of the applicant.

e. Ordering the first respondent to pay the costs of this application on the party and party scale B.

S.M WENTZEL

ACTING JUDGE OF THE HIGH COURT, PRETORIA

For the Applicant:

Adv. Adv Bless Manyelo —Kubheka

Instructed by Mmhlongo Inc Attorney

For the Respondent:

Adv. R Sepitsi Maphutha

instructed by Morakile, Tabane Attorneys Inc.