Schickerling NO and Another v Chickenland (Pty) Ltd t/a Nando's (22712/2016) [2016] ZAGPPHC 208 (15 April 2016)

Schickerling NO and Another v Chickenland (Pty) Ltd t/a Nando's (22712/2016) [2016] ZAGPPHC 208 (15 April 2016)

The court found that the royalties were not paid by the deadline set out in the cancellation letter, and that the franchise agreement's cancellation clause constituted a valid lex commissorio. The letter of cancellation came to the knowledge of the business rescue practitioner, who was responsible for ensuring payment. Even if strict compliance with the domicilium notice requirement was not met, the second applicant had actual knowledge of the termination. The business rescue proceedings did not impact the validity of the cancellation, as no statutory or case law prohibition was identified. The applicants failed to establish a prima facie right to interim relief, as the contract had been...

Citation
[2016] ZAGPPHC 208
Parties
Applicant: John Frederick Schickerling N.O.; Applicant: Ashraf Alli Gani Investments CC; Respondent: Chickenland (Pty) Ltd t/a Nando's
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
15 April 2016
Case Number
22712/2016
Procedural Posture
Urgent Application / Application for Interim Mandatory Interdict Pending Outcome of Main Action
Outcome
Application dismissed with costs.
Judges
S Potterill
Legal Topics
Franchise Agreement Termination, Business Rescue Proceedings, Interim Interdict, Lex Commissorio, Notice Requirements, Urgency in Motion Court
Commercial and Corporate Civil Procedure Franchise Agreement Termination Business Rescue Proceedings Interim Interdict Lex Commissorio Notice Requirements Urgency in Motion Court

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Parties

John Frederick Schickerling N.O.

Applicant

Ashraf Alli Gani Investments CC

Applicant

Chickenland (Pty) Ltd t/a Nando's

Respondent

Procedural Posture

Urgent Application / Application for Interim Mandatory Interdict Pending Outcome of Main Action

Legal Issues

  1. 1 Whether the termination of the franchise agreement was valid and effective.
  2. 2 Whether the applicants have a prima facie right to interim relief pending the outcome of the main action.
  3. 3 Whether the business rescue plan or proceedings impact the validity of the termination.

Ratio Decidendi

The court found that the royalties were not paid by the deadline set out in the cancellation letter, and that the franchise agreement's cancellation clause constituted a valid lex commissorio. The letter of cancellation came to the knowledge of the business rescue practitioner, who was responsible for ensuring payment. Even if strict compliance with the domicilium notice requirement was not met, the second applicant had actual knowledge of the termination. The business rescue proceedings did not impact the validity of the cancellation, as no statutory or case law prohibition was identified. The applicants failed to establish a prima facie right to interim relief, as the contract had been...

Court Disposition

Application dismissed with costs.

Orders

  • The application is dismissed with costs.