Summertime Enterprises (Pty) Ltd v Robertson and Others (30364/2016) [2017] ZAGPJHC 81 (17 February 2017)

Summertime Enterprises (Pty) Ltd v Robertson and Others (30364/2016) [2017] ZAGPJHC 81 (17 February 2017)

The court found that the first respondent is bound by the restraint of trade clause in the sale agreement and has breached it by competing with the applicant. The onus was on the first respondent to show that the restraint is unreasonable and contrary to public interest, which he failed to do by not placing any facts before the court. The argument that he did not receive the full purchase price does not justify breaching the restraint; his remedy lies in suing for the balance, not in violating contractual obligations. The restraint protects the proprietary interests acquired by the applicant in the sale of the business. The first respondent, while serving as a director of the applicant,...

Citation
[2017] ZAGPJHC 81
Parties
Applicant: Summertime Enterprises (Pty) Ltd; Respondent: Euan Robertson Mc Harg; Respondent: Joan Elizabeth Mc Harg; Respondent: Matthew Adam Mc Harg; Respondent: Bopa-Lock Close Corporation t/a Toolmac Agencies
Court
South Gauteng High Court, Johannesburg
Jurisdiction
South Africa
Judgment Date
17 February 2017
Case Number
30364/2016
Procedural Posture
Urgent Application / Judgment
Outcome
The application is granted in part. The first respondent is interdicted and restrained from competing with the applicant and declared a delinquent director. The application against the second respondent is dismissed with costs. The third respondent is ordered to pay costs for the relevant period.
Judges
André Gautschi
Legal Topics
Restraint of Trade, Delinquent Director, Sale of Business, Breach of Contract, Confidential Information
Commercial and Corporate Civil Procedure Restraint of Trade Delinquent Director Sale of Business Breach of Contract Confidential Information

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 2 Party arguments 2 Amounts and remedies 5
Sign in to unlock

Parties

Summertime Enterprises (Pty) Ltd

Applicant

Euan Robertson Mc Harg

Respondent

Joan Elizabeth Mc Harg

Respondent

Matthew Adam Mc Harg

Respondent

Bopa-Lock Close Corporation t/a Toolmac Agencies

Respondent

Procedural Posture

Urgent Application / Judgment

Legal Issues

  1. 1 Whether the restraint of trade clause in the sale agreement is enforceable against the first respondent.
  2. 2 Whether the first respondent should be declared a delinquent director under section 162(5)(c) of the Companies Act 71 of 2008.
  3. 3 Whether the second and third respondents are in breach of their respective restraint clauses.

Ratio Decidendi

The court found that the first respondent is bound by the restraint of trade clause in the sale agreement and has breached it by competing with the applicant. The onus was on the first respondent to show that the restraint is unreasonable and contrary to public interest, which he failed to do by not placing any facts before the court. The argument that he did not receive the full purchase price does not justify breaching the restraint; his remedy lies in suing for the balance, not in violating contractual obligations. The restraint protects the proprietary interests acquired by the applicant in the sale of the business. The first respondent, while serving as a director of the applicant,...

Court Disposition

The application is granted in part. The first respondent is interdicted and restrained from competing with the applicant and declared a delinquent director. The application against the second respondent is dismissed with costs. The third respondent is ordered to pay costs for the relevant period.

Orders

  • The first respondent is interdicted and restrained, until 2 December 2020, from participating in any industry in direct or indirect competition with the business formerly conducted by Macbolt Industrial Supplies CC within the Republic of South Africa.
  • The first respondent is interdicted and restrained from dealing with the business' clients directly or indirectly in any capacity within related industries.