Reckmann v Mabundla N.O. and Others (22734/2022) [2024] ZAGPJHC 370 (12 April 2024)

Reckmann v Mabundla N.O. and Others (22734/2022) [2024] ZAGPJHC 370 (12 April 2024)

The court found that the shareholders agreement clearly provided for expert determination and not arbitration, expressly excluding the application of the Arbitration Act. The first respondent was validly appointed as an expert, not an arbitrator, and exercised his discretion in accordance with the agreement. The applicant was represented throughout, was aware of the procedural requirements, and failed to comply with discovery obligations, resulting in the striking out of his defence. No grounds were established under the Arbitration Act or common law to set aside the expert's determinations. The application was dismissed and the expert's award was made an order of court.

Citation
[2024] ZAGPJHC 370
Parties
Applicant: Gunther Franz Reckmann; Respondent: Busani Mabundla N.O.; Respondent: Empowa Mabunda N.O.; Respondent: Andrew Adam Sipshitz; Respondent: Rockfire SA Proprietary Limited; Respondent: Rainer Schorr; Respondent: Laurinee Castle; Respondent: Walter Fischer
Court
South Gauteng High Court, Johannesburg
Jurisdiction
South Africa
Judgment Date
12 April 2024
Case Number
22734/2022
Procedural Posture
Review Application / Judgment
Outcome
Application dismissed; counter-application granted; expert determination enforced as order of court; costs awarded against applicant.
Judges
Francis
Legal Topics
Shareholders Agreement, Expert Determination, Arbitration Vs Expert, Striking Out Defence, Removal of Expert, Enforcement of Expert Award
Commercial and Corporate Civil Procedure Shareholders Agreement Expert Determination Arbitration Vs Expert Striking Out Defence Removal of Expert Enforcement of Expert Award

Case Brief

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Parties

Gunther Franz Reckmann

Applicant

Busani Mabundla N.O.

Respondent

Empowa Mabunda N.O.

Respondent

Andrew Adam Sipshitz

Respondent

Rockfire SA Proprietary Limited

Respondent

Rainer Schorr

Respondent

Laurinee Castle

Respondent

Walter Fischer

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether the first respondent was appointed as an expert or arbitrator under the shareholders agreement.
  2. 2 Whether the determinations made by the first respondent should be set aside under the Arbitration Act or common law.
  3. 3 Whether the applicant was denied a fair hearing or prejudiced by procedural irregularities.

Ratio Decidendi

The court found that the shareholders agreement clearly provided for expert determination and not arbitration, expressly excluding the application of the Arbitration Act. The first respondent was validly appointed as an expert, not an arbitrator, and exercised his discretion in accordance with the agreement. The applicant was represented throughout, was aware of the procedural requirements, and failed to comply with discovery obligations, resulting in the striking out of his defence. No grounds were established under the Arbitration Act or common law to set aside the expert's determinations. The application was dismissed and the expert's award was made an order of court.

Court Disposition

Application dismissed; counter-application granted; expert determination enforced as order of court; costs awarded against applicant.

Orders

  • The application is dismissed.
  • The applicant and the fourth respondent must comply with the expert determination dated 16 September 2022.