read by Steyn P.
Oxygen Ltd v STM Marketing and Agencies Ltd.
and respondent are competitors in the liquid petroleum gas trade.
Appellant discovered that respondent was unauthorisedly
appellant's cylinders with its (respondent's) own gas. This led to
two applications by appellant in the High Court for
against respondent and for certain ancillary relief. This matter came
before Guni J who dismissed both applications
with an order for
attorney and client costs. An appeal was noted to this Court against
the judgment of Guni J.
affidavits before the court a quo appellant was entitled to the
relief sought in both applications. The appeal must accordingly
succeed. It was, however, necessary to point out in the judgment that
not only did Guni J reach the wrong conclusion, but in doing
made unfounded and unwarranted findings of unlawful conduct against
appellant in the most extravagant terms which this Court
reasons set out in the judgment of my brother Friedman, with which my
brother Kumleben and I concur, the appeal succeeds
and the orders
made by Guni J are set aside and substituted with orders agreed upon
by the parties' counsel as the orders which
should have been granted
in the event of the appeal succeeding, and which are set out in full
in the judgment which I hand in .
C of A
(CIV) BO.17 of 2000
COURT OF APPEAL OF LESOTHO
OXYGEN LIMITED APPELLANT
MARKETING & AGENCIES LTD RESPONDENT
is a company incorporated according to the company laws of South
Africa, having its registered office at Bloemfontein.
It carries on
business as the seller and distributor of liquified petroleum gases
on business at premises in Maseru as a distributor of LPG for Elfgas
Africa (Pty) Ltd (Elfgas), a competitor of appellant.
is purchased from a distributor, the customer pays a deposit of M75
on the gas cylinder. The cylinder remains the property
distributor. Customers who wish to have a cylinder re-filled may go
to any distributor, not necessarily the one from whom
purchase was made. The practice in the trade is that the distributor
will exchange the empty cylinder for a full cylinder
of its own
LPG.By agreement between the main suppliers, when a supplier is in
possession of empty cylinders belonging to another
supplier, it will
return those cylinders to the latter supplier who will give, in
exchange, those cylinders in its possession that
belong to the other
of Regulation 13 of the Regulations issued on 4 August 1997 in terms
of section 17A of the Fuel Services Control Act, 1983,
of LPG may not fill a LPG gas cylinder belonging to another
wholesaler without the written consent of the latter.
contends that respondent is unlawfully competing with it by filling
gas cylinder owned by appellant and clearly marked
as such, with its
Accordingly, on 12 May 1999, appellant brought an urgent ex parte
application in the High Court claiming inter alia an
restrain respondent from filling with gas the cylinders owned by
appellant and which carry the brand identification
of appellant or
any of its other businesses namely Mobil, Engen, Caltex, Homegas,
Sonap/Sonarep, Trek and Socony.
On 14 May
1999 a rule nisi operating as a temporary interdict was issued.
Respondent filed answering affidavits and appellant filed
affidavit. On 7 July 1999 a second application amplified in respect
of certain new facts (referred to later) claiming
relief, was launched. This application was also opposed. The two
applications were heard together. On 7 April
2000 Guni J, in a single
judgment, discharged both rules nisi with costs on the attorney and
client scale. This appeal lies against
support of its allegation that respondent was filling applicant's
cylinders with its own LPG, appellant lodged two affidavits,
deposed by Johannes Lodewikus Erasmus and the other by Johan Goosen.
Both deponents are employed by Private Detective Services.
March 1999 Erasmus and Goosen drove to respondent's premises
they handed an empty 9 kg Afrox cylinder with serial no CI55699 to an
with a request that it be exchanged for a full one. They were handed
an Afrox cylinder with serial no C103205 T in exchange.
It was sealed
with a plastic transparent seal. The following day they repeated the
exercise. This time they handed the attendant
an empty 18kg Afrox
cylinder with serial no TL371 and received in exchange another 18kg
Afrox cylinder with serial no. F 16963
8. They made video recordings
of the empty cylinders as well as the full ones they received. In the
founding affidavit by Giles
William Parker (Parker), appellant's
branch manager for Bloemfontein, it was stated that the video
recordings would be made available
at the hearing should they be
second application Parker stated that on 29June 1999 he received a
report from a sales representative who had seen approximately
silver and grey cylinders with the distinctive Afrox marking on them
at an unmarked warehouse on the road from Mafeteng to
himself went to the warehouse where he also saw the Afrox cylinders.
He suspected the warehouse to be that of respondent.
On 2 July 1999
in order to confirm his suspicion he sent one L.F. Mopeli (Mopeli),
appellant's sales manager for Lesotho, to buy
gas at the warehouse.
On 3 July
1999 Mopeli deposed to an affidavit in which he stated that on 2 July
1999 he went to the warehouse taking with him an
empty Afrox cylinder
and requested that it be filled. He paid R50 for which he received a
receipt. He was asked to hand the receipt
to a worker at the
warehouse who gave him a full Afrox gas cylinder. The worker took the
serial number of the Afrox cylinder, wrote
it on the back of the
receipt and signed it. Mopeli also noticed about 1000 silver Afrox
cylinders with the distinctive Afrox markings
explained that appellant's complaint was that by keeping a large
number of appellant's cylinders at the warehouse, respondent
keeping appellant's capacity out of circulation. He stated -
"The less Afrox cylinders there are in circulation amongst
customers, the less LPG Afrox can sell. It impedes the availability
of cylinders to fill with LPG. Furthermore, by using the Afrox
cylinders to fill with respondent's LPG, the respondent did not
the capital outlay to purchase his own cylinders and put it in
circulation. He did not need capital outlay to purchase capacity
containers to fill. He uses Afrox
cylinders to raise his own capacity. By so doing, he also can sell
LPG at a lower price, having had lesser capital outlay. He then
away the Afrox LPG market by unlawfull competition."
the new facts which gave rise to the second application. In the
second application appellant did not seek an interdict;
the relief sought to orders in terms of which appellant's cylinders
at the warehouse, were to be returned to it.
answering affidavit Selai Mokete (Mokete), respondent's managing
director, raised a number of points in limine.
he said that appellant had failed to disclose material facts, namely
that each of the parties had in the normal course
of trade, exchanged
empty gas cylinders belonging to the other and that this had
continued until shortly before the first application
as the parties had been exchanging gas cylinders as aforesaid, there
was no reason for appellants to have brought the
application as a
matter of urgency.
appellant's application was mala fide and appellant had not
approached the Court with clean hands. Respondent alleged that
an agreement with Elfgas in terms of which it is authorised to
distribute Elfgas in Lesotho. Appellant is a competitor of
what it is attempting to do is to frustrate Elfgas in the
distribution of LPG in the whole region of Southern Africa.
alleged, further, that appellant has at its various depots in the
Republic of South Africa, filled its own product into
clearly marked as the property of Elfgas.
support of this allegation respondent filed an affidavit by one Johan
Stephen Scott, a private investigator of Bloemfontein.
testified that at appellant's depots at Newcastle, Pietersburg,
QwaQwa, Ladysmith, Zebedelia, Tzaneen and Duiwelskloof he
purchased LPG in cylinders belonging to Elfgas.
affidavit deposed to by Robin Brian Lord (Lord), the sales manager of
Elfgas it is stated that appellant makes a practice
courts on an urgent basis without notice for similar relief without
disclosure of its own conduct. He referred,
in this regard, to three
cases in South Africa.
Mokete stated that applicant had, in contravention of the liquefied
Petroleim Gas (Trade and Handling) Regulations, removed
a number of
respondent's cylinders out of Lesotho into South Africa.
respondent alleged that appellant had no locus standi as it has not
established that it is licenced in terms of section
3 of the
Liquified Petroleum Gases (Trade and Handling) Regulations of 1997 to
sell or deal in LPG in Lesotho.
regard to the affidavits of Erasmus and Goosen, Mokete stated that
the video recording was not made at respondent's premises
the attendant did not fill the empty Afrox cylinders with its own
gas; what the attendant gave them were full Elfgas cylinders.
denied that respondent was keeping sealed Afrox cylinder at its
replying affidavit Parker admitted that similar applications had been
brought in South Africa. Some were still pending while
settled on the basis that the orders prayed for were granted. He
stated that it was contrary to company policy for
cylinders to be filled with Afrox LPG and the company tried its best
to prevent this from happening. He attached
a copy of
circular sent to all Afrox depots warning employees that if they
breached this instruction that they would be liable to dismissal.
With regard to the allegation that appellant was not licenced, he
annexed a copy of appellant's licence which was valid until 31
allegation that appellant had, in contravention of the LPG
regulations, removed gas cylinders of the respondent from Lesotho
South Africa, was denied by Parker.
dealing with the merits of the two applications it is necessary to
consider the points in limine taken by respondent as these
were upheld by the court a quo.
to the alleged non-disclosure of material facts Guni J found that
appellant had failed to disclose that the parties had
the customary exchange of cylinders and that had appellant done so it
would not have been entitled to an order
compelling respondent to
return the Afrox cylinders which were in its possession. I cannot
agree with this reasoning. Appellant
made it clear in the founding
papers what the trade practice was. The fact that the parties were
continuing to give effect to that
practice while respondent was, on
unlawfully filling appellant's cylinders with its own LPG, did not in
any way detract from appellant's case. The fact that
not expand on the extent to which the trade practice was being
utilised prior to the application cannot be described
non-disclosure of a material fact justifying the dismissal of the
second point in limine, namely that because the parties had been
exchanging cylinders there was no need for appellant to have
the application on an urgent basis, is without merit. On appellant's
version of the facts, the urgency was, in my judgment,
point in limine was that the application was mala fide and that
appellant had not approached the court with clean hands.
allegation was dealt with in the replying affidavit, the salient
facts of which have been summarised above. Suffice it to
say that in
the light of the answers furnished by appellant, there is no
substance in this point in limine.
there is no merit in the fourth point in limine, namely that
appellant had no licence. The copy of the licence annexed
replying affidavit disposed of this point.
now to the merits of the application.
gravamen of applicant's applications was the allegation that
respondent was making use of appellant's cylinders to fill and
its own gas. Guni J found that "There has so far been no
evidence to support this allegation."
evidence placed before the court a quo by appellant was that of
Erasmus and Goosen. Guni J appears to have dismissed their evidence
on the ground that the video recordings which they took, were not
produced. The learned judge stated that respondent denies that
two detectives were given full Afrox cylinders and denies that the
video recordings were made at its premises. Guni J said:
that is why appellant decided after all not to produce the video
tapes." Appellant said the video tapes would
be produced if
necessary. There is no suggestion that either the court or respondent
asked for them to be produced. But even in
the absence of the videos
there was evidence which called for an answer and none was
forthcoming except for a bald denial. The
deponent, Mokete, who made
the denial, does not state that he had personal knowledge of the
incidents deposed to by Erasmus and
Goosen. He stated that the
attendant sold Elfgas LPG to Goosen and Erasmus, but there is no
affidavit from the attendant. In any
event there is no answer to the
allegations in the second application
the affidavit of Mopeli as to the events that took place at the
whole episode was not dealt with in respondent's answering affidavit.
Nor was it even referred to in the judgment of the court
bald denials were insufficient to create a dispute of fact which
would have warranted the dismissal of the applications.
in motion proceedings cannot defeat the applicant merely by bare
denials such as might be employed in a pleading.
See Room Hire Co.
(Pty) Ltd v Jeppe Street Mansions (Pty) Ltd 1949 (3) SA 1155 (T) at
Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA
623 (A) at 6341 - 635C where the approach to be adopted
is a dispute of fact on the papers is set out as follows:
"In certain instances the denial by respondent of a fact alleged
by the applicant may not be such as to raise a real, genuine
fide dispute of fact (see in this regard Room Hire Co (Pty) Ltd v
Jeppe Street Mansions (Pty) Ltd 1949 (3) SA 1155 (T)
at 1163-5; Da
Mata v Otto NO 1972 (3) SA 858 (A) at 882D-H). If in such a
case the respondent has not availed himself of his right to apply for
the deponents concerned to be called for cross-examination
6 (5) (g) of the Uniform Rules of Court (cf Petersen v Cuthbert &
Co Ltd 1945 AD 420 at 428; Room Hire case supra
at 1164) and the
Court is satisfied as to the inherent credibility of the applicant's
factual averment, it may proceed on the basis
of the correctness
thereof and include this fact among those upon which it determines
whether the applicant is entitled to the
final relief which he seeks
(see eg Rikhoto v East Rand Administration Board and Another 1983 (4)
SA 278 (W) at 283 E-H). Moreover,
there may be exceptions to this
general rule, as, for example, where the allegations or denials of
the respondent are so far-fetched
or clearly untenable that the Court
is justified in rejecting them merely on the papers (see the remarks
of Botha AJA in the Associated
South African Bakeries case, supra at
has clearly overlooked these principles. In her judgment she made
and reached conclusions adverse to appellant, based merely on
respondent's bare denials buttressed by allegations made
respondent which were denied by appellant. In doing so she used
extravagent language to describe appellant's actions which was
entirely unwarranted on the affidavits before her. The following
passages from the judgment illustrate the lengths to which she
in her search for reasons to justify the dismissal of the
to the critical issue as to whether respondent was filling
applicant's cylinders with its (respondent's) LPG, Guni J stated:
"The applicant did not only withold true facts which would have
indicated to this court clearly, the attitude of the respondent,
lied, that the respondent fills applicant's cylinders with Elf gas
which is distributed by the respondent. Strangely enough
claimed that it distributes ELFgas and obtained the court order which
even though respondent is ELFgas distributor it
was restrained from
receiving ELFgas cylinders which are, in fact respondent's own
(Appellant in this Court) neither lied nor made any of the claims
to it in this passage. If anything this passage suggests that the
under a misconception as to the nature of appellant's complaint and
the relief it was seeking.
learned judge went on the add :
"It was not only the witholding of true facts, there were also
some false allegations."
these so-called false allegations are is not spelt out in the
judgment. In the light of the evidence, how Guni J could have
that appellant "lied" and made "false allegations"
is beyond comprehension.
to the fact that the video tape was not produced, the learned judge
"If there were video tapes, showing the refilling or filling of
applicant's cylinders it was not done by or at the respondent's
finding was unjustified in the face of the ineffectual denial by
respondent. However, the learned judge went on to state:
"The applicant decided not to produce the said video tape after
all. There may have been no video tape after all. The reasons
applicant's failure to prove those allegations that the respondent
was committing unlawful acts are best known to this
They were not put before this court. The lack of scruples seems to
characterise the applicant. Its main objective
was to obtain that
undeserved rule nisi. It is most unfortunate that the said rule nisi
was obtained by deception."
with reference to the applicant's failure to deal with the recent
exchange of cylinders, the learned judge expressed herself
"In order to obtain my sympathy, (and I did feel sympathetic
towards the applicant), lies were told. Deliberate and carefully
calculated omission were made. It is a lie that the respondent fills
or refills the applicant's cylinders with respondent's own
was a deliberate and carefully calculated omission to
fail to mention that these two parties, participate fully, as often
as anyone of them feels the need to do so, in that trade customary
exchange of their cylinder. It was malicious to obtain by deception
honerous and prejudicial interim order without notice to the
respondent, more particularly, when recent exchanges had taken place
and more exchanges could take place anytime as applicant wanted."
with the allegation that appellant had unlawfully removed
respondent's cylinders from' Lesotho to South Africa (which was
denied by appellant), the learned judge said
"The failure by the police to make arrest could be due to
various reasons including corruption."
a totally unfounded and unwarranted supposition. The learned judge
went on to state:
The applicant's attitude regarding the respect for the law, and its
manipulation of courts, are clear indicators that it is very
contemptuous of both. While in the process of committing offences the
law and courts were used to tie the hands of law abiding
are falsely being accused of committing those crimes."
conclusion was that -
"In the light of the conduct of the applicant in these two
applications, its business tactics are not only unethical. They
unlawful. This kind of business should not be allowed in this
clear from what has been set out above, that none of these findings
is justified. In view of the gravity of these strictures,
regrettable that they should have been made at all. What is worse is
the extravagant and irresponsible language used, when,
cause, the learned judge accuses the appellant inter alia of mala
fides, "manipulation of courts" "contemptuous"
conduct, corruption and "committing criminal offences." The
judgment demonstrates a
judicial intemperance and irresponsibility which is unacceptable from
judicial officer and the more so from a judge of the high Court.
It was on
the basis of these findings that an award of attorney and client
costs was ordered against appellant. Needless to say,
this was not
justified and Mr Phafane, who appeared for respondent, quite rightly
did not support that order.
up, in my judgment, appellant was entitled to appropriate relief in
both applications. Mr Fischer, who appeared for appellant,
that the orders sought in the notices of motion were framed too
widely in certain respects. This is a consideration which
nature of things could not have arisen in the court a quo for the
reason that the rule was discharged. Counsel were in agreement
the terms in which the orders should be framed in the event of the
appeals succeeding. These terms will be incorporated in
made in this judgment.
appellant has been substantially successful in the appeal, there is
no reason why the costs of the appeal should not follow the
Similarly, in regard to the costs of the applications, as the extent
to which the orders sought have, by agreement, been
abridged, is not
significant, there is no basis for
2.2 The sheriff is directed to take possession of any of the
cylinders referred to in paragraph 1 above which are found by the
sheriff in the possession of the respondent at the respondent's
premises at Ha Mabote, Main North Road, Maseru or which are found
the sheriff on any vehicles which are identified as those of the
respondent, or which are being used to convey any such cylinders
or on behalf of the respondent, presently or in the future, and
whether such cylinders contain gas or not. To give effect to
order, the sheriff is authorised to enter on and search upon such
premises or vehicles, and if entry or search is resisted,
the assistance of the Lesotho police.
2.3 The sheriff is authorised to employ the assistance of a suitably
qualified and duly authorised representative of appellant
any such cylinders if the sheriff is in doubt as to their identity.
2.4 The appellant shall pay to the respondent from whom the applicant
or the sheriff, as the case may be, receives any such cylinders,
amount equal to the deposit of M75.00 together with such further
amount relating to the cost of the contents of the cylinder
of such cylinder having been filled by the respondent.
2.5 The sheriff is directed to hand any cylinder of which he has
taken possession to the applicant to be kept within the jurisdiction
of this court, until compliance by the applicant with paragraph 2.4
2.6 Paragraph 2.1 above shall be binding on the respondent for so
long as it deals directly or indirectly in liquid Petroleum gas.
2.7 Respondent is to pay the costs of this application.
CIV/APN/270/99 it is ordered that:
sheriff is directed to seize and take possession of any of the type
of cylinders specified hereunder (whether they contain
gas or not),
which we found in the possession of respondent at the green arched
corrugated warehouse, situated at the left hand
side next to the road
leading from Mafeteng to Maseru, at the Roma T-junction (in the
vicinity between residential area Mazenod
and Masianokeng), namely
steel pressure designed gas cylinders with a gas mass of 9 kg, 14kg,
19kg and 48kg which are the property
of the applicant and
carry the brand idenfication of one of the following brands:
execute order 1 the sheriff is authorised to engage the assistance
of any member of the Lesotho police and to enter on and
abovementioned premises. If the respondent or any of its managers
and/or employees and/or any person on the premises
do not obey or do
obstruct the sheriff in the execution of this order, such person may
be arrested by the member or members of
the Lesotho police to be
charged with contempt of court.
sheriff is authorised to employ the assistance of a suitably
qualified and duly authorised representative of applicant to identify
any such cylinders if the sheriff is in doubt as to their
execute order 1 the sheriff is authorised to engage the assistance
of the Registrar of this court and members of Gray Security
applicant shall pay to the respondent from whom the applicant or the
sheriff, as the case may be, seized or received any such
an amount equal to any deposit subject to a maximum amount per
cylinder of M75,00 together with such further amount
relating to the
cost of the contents of the cylinder in the event of such cylinder
having been filled by respondent.
sheriff is directed to hand any cylinder of which he has taken
possession to the applicant, to be kept within the jurisdiction
this court, until compliance by the applicant with 5 paragraph
1 shall be binding on the respondent for as long as it deals
directly or indirectly with liquid petroleum gas.
is to pay the costs of this application."
at Maseru this........day of October 2000
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