Van As v Van der Merwe (A332/2010) [2011] ZAWCHC 20 (18 February 2011)

Van As v Van der Merwe (A332/2010) [2011] ZAWCHC 20 (18 February 2011)

The respondent failed to prove that the losses suffered were caused by the appellant's breach of the restraint of trade clause. There was no evidence establishing a causal link between the breach and the quantum of damages claimed. The evidence showed that other factors, unrelated to the appellant's conduct, contributed to the business losses. The magistrate erred in conflating the restraint of trade clause with the goodwill provision and in awarding damages based solely on the value attributed to goodwill in the sale agreement. The proper remedy for breach of a restraint clause is usually a prohibitory interdict, not automatic damages. Accordingly, the appeal succeeds and the defendant...

Citation
[2011] ZAWCHC 20
Parties
Appellant: Garry Van As; Respondent: Emile Van der Merwe
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
18 February 2011
Case Number
A332/2010
Procedural Posture
Civil Appeal / Appeal From Magistrates' Court
Outcome
Appeal upheld; magistrate's finding set aside; defendant absolved from the instance.
Judges
R B Cleaver, C Fortuin
Legal Topics
Restraint of Trade, Sale of Business, Goodwill, Damages Quantification
Commercial and Corporate Civil Procedure Restraint of Trade Sale of Business Goodwill Damages Quantification

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 3
Sign in to unlock

Parties

Garry Van As

Appellant

Emile Van der Merwe

Respondent

Procedural Posture

Civil Appeal / Appeal From Magistrates' Court

Legal Issues

  1. 1 Whether the restraint of trade clause in the sale agreement was binding on the appellant.
  2. 2 Whether the respondent proved damages resulting from breach of the restraint of trade clause.
  3. 3 Whether there was a causal link between the alleged breach and the damages claimed.

Ratio Decidendi

The respondent failed to prove that the losses suffered were caused by the appellant's breach of the restraint of trade clause. There was no evidence establishing a causal link between the breach and the quantum of damages claimed. The evidence showed that other factors, unrelated to the appellant's conduct, contributed to the business losses. The magistrate erred in conflating the restraint of trade clause with the goodwill provision and in awarding damages based solely on the value attributed to goodwill in the sale agreement. The proper remedy for breach of a restraint clause is usually a prohibitory interdict, not automatic damages. Accordingly, the appeal succeeds and the defendant...

Court Disposition

Appeal upheld; magistrate's finding set aside; defendant absolved from the instance.

Orders

  • The appeal succeeds with costs.
  • The finding of the magistrate is set aside and substituted with: 'The defendant is absolved from the instance and the plaintiff is ordered to pay the defendant's costs.'