Spar Group Limited and Others v Twelve Gods Supermarket (Pty) Ltd and Others (AR31/2021 and AR32/2021) [2022] ZAKZPHC 29 (7 July 2022)

Parties

Procedural Posture

Civil Appeal / Full Court Appeal From Orders in Two Related Applications (termination and Drop Shipment)

Legal Issues

1. 1 Whether the termination of the respondents' membership from the Spar Guild was valid and lawful.
2. 2 Whether the respondents repudiated the agreement to participate in a hearing prior to termination.
3. 3 Whether Spar's unilateral amendment of credit terms and limitation of drop-shipment supplies was valid and exercised in good faith.

Ratio Decidendi

The Full Court held that Spar had expressly agreed to convene a hearing before terminating the respondents' membership, and that procedural fairness was required. The respondents did not repudiate the agreement to participate in a hearing; their conduct was consistent with seeking a fair process. Spar's failure to hold the hearing and its subsequent termination of membership was invalid and unlawful. The second set of termination notices, purportedly relying on a clause allowing termination without reason, was also invalid because the agreement to hold a hearing encompassed all grounds for termination. Regarding the unilateral amendment of credit terms and limitation of drop-shipment...

Court Disposition

Appeal dismissed with costs, including costs of all senior and junior counsel employed.

Orders

• The appeal against the orders of Barnard AJ issued on 17 July 2020 in Case Number 8280/19P and Case Number 9215/19P is dismissed with costs, such costs to include costs of all senior and junior counsel, where so employed.