Pick 'n Pay Retailers (Pty) Ltd and Others v Eayrs NO and Others (809/2010) [2011] ZASCA 147; 2012 (1) SA 238 (SCA); [2012] 1 All SA 522 (SCA) (26 September 2011)

Pick 'n Pay Retailers (Pty) Ltd and Others v Eayrs NO and Others (809/2010) [2011] ZASCA 147; 2012 (1) SA 238 (SCA); [2012] 1 All SA 522 (SCA) (26 September 2011)

The Supreme Court of Appeal held that the addendum to the franchise agreement, which extended the period for exercising the franchisor's right of pre-emption, constituted a new agreement concluded after the sale of shares agreement. The franchisor did not exercise its right of pre-emption within the original 30-day period provided by the franchise agreement. On a strict application of the maxim qui prior est tempore potior est iure, the purchaser's rights under the sale of shares agreement, which were acquired earlier, should be preferred over the franchisor's subsequently acquired extended right. The addendum did not amount to a waiver or mere prolongation of the original right but...

Citation
[2011] ZASCA 147
Parties
Appellant: Pick 'n Pay Retailers (Pty) Ltd; Appellant: Pick 'n Pay Franchisee Financing (Pty) Ltd; Appellant: Stephanus Johannes Strydom N.O.; Appellant: Dean Alan Holdstock N.O.; Appellant: Adele Kathleen Holdstock N.O.; Appellant: Carter Trading (Pty) Ltd; Respondent: Michael Bradley Eayrs N.O.; Respondent: Colin Mark de Villiers N.O.; Respondent: Howard Hughes o.b.o. The Daku Trust; Respondent: Barry Neil Carter N.O.; Respondent: Linda Carter N.O.; Respondent: Alan Melville Carter N.O.; Respondent: Mary Patricia Carter N.O.
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
26 September 2011
Case Number
809/2010
Procedural Posture
Civil Appeal / Appeal From Eastern Cape High Court, Port Elizabeth
Outcome
Appeal dismissed with costs.
Judges
Brand, Malan, Leach, Seriti, Wallis
Legal Topics
Pre Emptive Rights, Franchise Agreements, Specific Performance, Contract Variation, Sale of Shares, Maxim Priority Rule
Commercial and Corporate Civil Procedure Pre Emptive Rights Franchise Agreements Specific Performance Contract Variation Sale of Shares Maxim Priority Rule

Case Brief

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Parties

Pick 'n Pay Retailers (Pty) Ltd

Appellant

Pick 'n Pay Franchisee Financing (Pty) Ltd

Appellant

Stephanus Johannes Strydom N.O.

Appellant

Dean Alan Holdstock N.O.

Appellant

Adele Kathleen Holdstock N.O.

Appellant

Carter Trading (Pty) Ltd

Appellant

Michael Bradley Eayrs N.O.

Respondent

Colin Mark de Villiers N.O.

Respondent

Howard Hughes o.b.o. The Daku Trust

Respondent

Barry Neil Carter N.O.

Respondent

Linda Carter N.O.

Respondent

Alan Melville Carter N.O.

Respondent

Mary Patricia Carter N.O.

Respondent

Procedural Posture

Civil Appeal / Appeal From Eastern Cape High Court, Port Elizabeth

Legal Issues

  1. 1 Whether the extended right of pre-emption created by the addendum to the franchise agreement should be preferred over the purchaser's right to specific performance under the sale of shares agreement.
  2. 2 Whether the addendum constituted a new agreement conferring new rights after the sale of shares agreement was concluded.
  3. 3 Whether the maxim qui prior est tempore potior est iure applies to the competing rights in this matter.

Ratio Decidendi

The Supreme Court of Appeal held that the addendum to the franchise agreement, which extended the period for exercising the franchisor's right of pre-emption, constituted a new agreement concluded after the sale of shares agreement. The franchisor did not exercise its right of pre-emption within the original 30-day period provided by the franchise agreement. On a strict application of the maxim qui prior est tempore potior est iure, the purchaser's rights under the sale of shares agreement, which were acquired earlier, should be preferred over the franchisor's subsequently acquired extended right. The addendum did not amount to a waiver or mere prolongation of the original right but...

Court Disposition

Appeal dismissed with costs.

Orders

  • The appeal is dismissed with costs.