THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Not Reportable
Case No: 749/2020
In the matter between:

EDWIN HUBERT VAN DER MERWE
APPELLANT

and

BONNIEVALE PIGGERY (PTY) LTD
RESPONDENT

Neutral citation: Van der Merwe v Bonnievale Piggery (Pty) Ltd (749/2020)
[2021] ZASCA 162 (1 December 2021)
Coram:
SALDULKER
ADP
and
SCHIPPERS,
NICHOLLS,
MBATHA and HUGHES JJA
Heard:

4 November 2021
Delivered:            This judgment was handed down electronically by circulation
to the parties' representatives by email, publication on the
Supreme Court of Appeal website and release to SAFLII. The
date and time for hand-down is deemed to be 09h45 on
1 December 2021.

Summary: Contract – interlinked contracts for sale of pork products – prices in
sale contract market related – parties unable to reach agreement on price – no
consensus – contractual arrangement ended – counterclaim for breach of contract
– party allegedly failing to adjust prices – not giving written notice of inability to
do so – not proved – delict – unlawful competition – use of confidential
information to poach customers – not established – appeal dismissed.

________________________________________________________________

ORDER
________________________________________________________________
On appeal from: Western Cape Division of the High Court, Cape Town (Binns-
Ward, Steyn and Sher JJ, sitting as court of appeal):
The appeal is dismissed with costs, including the costs of only senior counsel.
________________________________________________________________
JUDGMENT
________________________________________________________________
Schippers JA (Saldulker ADP and Nicholls, Mbatha and Hughes JJA
concurring)
[1] The appellant, Mr Edwin van der Merwe (the defendant), is a former seller
of slaughtered pig carcasses (carcasses), supplied by the respondent, Bonnievale
Piggery (Pty) Ltd (the plaintiff), which keeps and rears pigs for slaughter, under
a series of interlinked agreements. In 2013 the plaintiff instituted action against
the defendant for payment of R1 196 868,84, which was the outstanding balance
due in respect of carcasses supplied to the defendant, interest and short payment
of purchases.

[2] Part of the defendant’s initial defence to the action was that he had been
overcharged for carcasses purchased, and that the plaintiff had not complied with
the requirements of the National Credit Act 34 of 2005 (the NCA) by granting
him credit without being registered as a credit provider. The defendant also
alleged that he had a claim against the plaintiff for breach of contract,
alternatively delict, for unlawful competition, that exceeded the amount of the
plaintiff’s claim.

[3] The case was tried before Parker J in the Western Cape Division of the
High Court, Cape Town. The parties agreed to a separation of the issues in terms
of rule 33(4) of the Uniform Rules of Court (the Rules) as follows:
‘The issue of quantum and causation of the defendant’s counterclaim (in the event of liability
being established) is stayed until the other issues in dispute between the parties are disposed
of.’
It is plain that causation, an essential element of a delictual claim, should not have
been separated from the defendant’s claim for unlawful competition. To do so
was misconceived. This Court has repeatedly stated that a trial court must be
satisfied that it is proper to make an order under rule 33(4), which should be made
only after ‘careful thought has been given to the anticipated course of the
litigation as a whole that it will be possible properly to determine whether it is
convenient to try an issue separately’.1

[4] Aside from this, the trial judge made an order that the defendant had
‘successfully established liability by the plaintiff and . . . [was] entitled to claim
such damages as may be proved in due course’, apparently on the basis of breach
of contract. This order however was made in circumstances where the defendant
had invoked rule 22(4) of the Rules, which required the judgments on the
plaintiff’s claim and the claim in reconvention to be given pari passu.2

[5] In the trial court the defendant’s counsel conceded that the defendant had
received and was obliged to pay for the carcasses referred to in the invoices that
formed the subject of the particulars of claim. The trial judge however dismissed

1 Denel (Edms) Bpk v Vorster 2004 (4) SA 481 (SCA) para 3; Government of the Western Cape: Department of
Social Development v C B and Others [2018] ZASCA 166; 2019 (3) SA 235 (SCA) paras 19-21.
2 Rule 22(4) in relevant part reads:
‘If by reason of any claim in reconvention, the defendant claims that on the giving of judgment on such claim, the
plaintiff's claim will be extinguished either in whole or in part, the defendant may in his plea refer to the fact of
such claim in reconvention and request that judgment in respect of the claim or any portion thereof which would
be extinguished by such claim in reconvention, be postponed until judgment upon the claim in reconvention.
Judgment on the claim shall, either in whole or in part, thereupon be so postponed . . . .’

the plaintiff’s claim with costs. The plaintiff was granted leave to appeal to a full
bench of the high court.

[6] Before the full court it was conceded by the defendant’s counsel that the
point based on the NCA had no merit. He informed the full court that the point
had been abandoned at the trial, but that did not appear from the record or the
judgment of the trial judge. The defendant also abandoned his claim for payment
of the amounts overcharged by the plaintiff. That left the nature of the parties’
business relationship and whether the defendant had established his claim in
reconvention, namely that he had suffered damages because of the plaintiff’s
alleged breach of contract and unlawful competition.

[7] The full court (Binns-Ward, Steyn and Sher JJ) upheld the appeal. It held
that the business relationship between the parties had come to an end in July 2012
when they could not agree on a price for carcasses, and that the defendant’s
counterclaim based on breach of contract and unlawful competition could not be
sustained on the evidence. The full court set aside the trial court’s order and
granted judgment against the defendant in favour of the plaintiff for payment of
the sum of R1 196 868,84, together with interest and costs. It dismissed the claim
in reconvention with costs. The appeal is before us with the leave of this Court.

[8] Before us the parties accepted that the defendant’s claim of unlawful
competition should be decided, despite the fact that the element of causation had
been excluded from the issues for decision under rule 33(4). It was also accepted
that on the evidence, the full court had been in a position to decide both the claims
in convention and reconvention.

[9] The basic facts were largely common ground. In 2005 the parties orally
entered into a business relationship which included: (i) contracts for the sale of

carcasses concluded on the basis of periodically agreed prices; (ii) an exclusive
supply agreement; and (iii) a sole distributorship agreement. The business
relationship, and with it the interlinked contracts, were of indefinite duration and
terminable at the instance of either party.

[10] The plaintiff granted the defendant a credit facility in terms of which he
agreed to pay amounts due for carcasses within 14 days of the date of invoice,
and interest at 2% above the prime rate in the event that he failed to do so. The
defendant concluded a written cession of his book debts to the plaintiff as security
for his obligations under the credit facility (the cession of book debts). In terms
of the cession of book debts, the defendant undertook to furnish the plaintiff at
regular intervals with particulars of all his debtors, the amount of their
indebtedness and details of securities held for those debts.

[11] In terms of the supply agreement, the plaintiff agreed to supply carcasses
to the defendant at reasonable, market related wholesale prices that would follow
market fluctuations. From the outset it was agreed that the plaintiff would also
supply pigs to Winelands Pork, a pig-slaughtering abattoir and wholesale
business involved in a joint venture with the plaintiff, as the defendant did not
buy all the plaintiff’s pigs and they had to be sold elsewhere. Under the
distributorship agreement the defendant exclusively sold carcasses to the retail
market for his own account and under his own brand to customers in the Western
Cape. He agreed not to sell carcasses in the area in which Winelands Pork sold
its products. The parties agreed not to compete in their respective areas of
distribution.

[12] The prices at which carcasses were sold to the defendant in the various
contracts of sale were negotiated and changed at least four times a year, and
depending on what happened in the market in the Western or Southern Cape,

would move either up or down. Prices were determined according to the size of
carcasses and the season. Broadly, smaller carcasses fetched higher prices than
ones in the heavyweight category. The prime marketing period for pork generally
was from October to December each year. During the winter months the turnover
of carcasses was lower because the pigs remained longer in the plaintiff’s pens
and grew in size and weight. This was a recurrent situation which resulted in an
oversupply of pigs, which the defendant referred to as a ‘bottleneck’.

[13] Throughout their relationship and despite constant arguments about prices,
the parties were able to address the problem of oversupply of pigs by reaching
agreement on prices in the numerous sale agreements between 2005 and 2012.
The defendant had often complained that the prices were too high, but ultimately
accepted them. However, in July 2012 the parties were unable to reach agreement
on the price for some 1300 pigs in the heavyweight category that needed to be
taken out of the plaintiff’s piggery. Consequently, the parties’ business
relationship came to an end.

[14] The plaintiff’s claim was for payment of carcasses delivered to the
defendant in January and February 2013. As stated, the defendant conceded that
he had obtained the benefit of those carcasses and had to pay for them. He asserted
that the amount counterclaimed for loss of profits should be set off against any
amount granted in judgment by the trial court. In his evidence the defendant
confirmed receipt of the carcasses forming the subject of the plaintiff’s claim and
that he had intended to pay the amount demanded. He said that he started
withholding payments from the plaintiff because he realised that he would have
to close his business, he had no money and there were 14 families dependent on
the work which he provided.

[15] The plaintiff had thus established its claim and it should not have been
dismissed by the trial court at the end of the first stage hearing. That this was a
misdirection was conceded by the defendant’s counsel before the full court. The
alleged breach of what the defendant called a ‘Supplier/Distribution Agreement’
and a ‘sole and exclusive distributorship’, that formed the basis of the
counterclaim, did not detract from the plaintiff’s entitlement to payment of
carcasses sold and delivered to the defendant under the sale agreements, for on-
sale by the defendant.

[16] The remaining issue then is whether the defendant had proved breach of
contract and unlawful competition as alleged in his counterclaim. As to the
former, he asserted that in terms of a supplier/distribution agreement, the plaintiff
had agreed to supply him with carcasses ‘at reasonable and market wholesale
prices’; that it would reduce those prices if there were negative market price
fluctuations; and that the plaintiff would furnish him with written reasons if it was
unable to adjust its prices. He alleged that in the course of the agreement the
parties would become privy to confidential information and operational secrets.
They had agreed, so it was alleged, that they would not utilise this information
for their own advantage, and specifically that they would not solicit or accept
business from each other’s customers.

[17] The defendant averred that in terms of the sole and exclusive
distributorship, the prices of products sold to him ‘would be market related and
follow market trends up or down’ and be linked to those charged to Winelands
Pork, with a premium of 40c per kilogram excluding a slaughtering fee of R1 per
kilogram. During the existence of the agreement or thereafter, the plaintiff would
not canvass or sell pork products to the defendant’s customers or compete with
him in any way.

[18] The defendant alleged that the plaintiff had breached the distributorship
agreement in the following respects. It refused to adjust its pork prices
downwards in accordance with prevailing market trends. Between July 2011 and
February 2013 the plaintiff increased the margin of prices charged to the
defendant but not to Winelands Pork. From July 2012 it refused to deliver
sufficient product for the defendant to service his market, as a result of which the
defendant was forced to purchase pork products from Hunters Vlei, a competitor
of the plaintiff. From June 2012 to February 2013, and with a view to putting him
out of business, the plaintiff had unlawfully competed with the defendant by
selling pork products directly to his customers at lower prices.

[19] As a result of the plaintiff’s alleged breach of contract and unlawful
competition, the defendant had been overcharged in the amount of R851 900,12
over a period of 20 months, totalling some R2.5 million. The defendant asserted
that he had suffered a loss of profits in the sum of R12 467 307,73 in respect of
his category A clients (those exclusively supplied by the defendant). He inferred
that he had suffered a loss in the same amount in relation to his category B clients
(whom the defendant did not exclusively supply).

[20] In its plea to the counterclaim the plaintiff admitted that it would have
obtained confidential information by virtue of the cession of book debts, but
denied that it had unlawfully competed with the defendant. The plaintiff also
denied the defendant’s allegations regarding breach of contract and pleaded that
the sales agreement could in any event not continue because the parties could not
reach agreement on the selling price of pork products.

[21] The question of what would happen to their business relationship and the
interlinking agreements if the parties could not agree on a price for carcasses was
at the heart of the dispute between them. In July 2012 the dispute about the price

of some 1300 pigs that had to be cleared out of the plaintiff’s pens had reached
an impasse, as neither side would compromise. Around 17 July 2012 there was a
meeting at a coffee shop in Bonnievale to resolve the impasse. Mr Johan
Broodryk, the owner of Bonnievale Abattoir, agreed to reduce the slaughtering
fee charged to the defendant. Mr Burger, on behalf of the plaintiff, was willing to
reduce the price of carcasses. The defendant was asked to sell the oversupply at
lower profit margins. The parties however could not reach agreement on the price
which, the full court held, resulted in the failure of the entire contractual scheme
through no fault of either of them.

[22] However, before us counsel for the defendant submitted that the parties
could not reach agreement on the purchase price because the plaintiff had failed
to adjust its prices downwards. This, it was argued, was borne out by the objective
facts and evidence. After the July 2012 meeting the defendant had written to the
plaintiff informing it of the prices at which it could sell the 1300 carcasses, to
which it never received a reply. The next thing the defendant knew, so it was
submitted, was that the plaintiff had delivered a large amount of carcasses to the
defendant’s main customer and excluded him as the middleman, which was ‘a
planned strategy’.

[23] These submissions are unsound. There is no evidence that the plaintiff
breached the sales or supply agreement because it failed to adjust prices
downwards. That much is clear from the defendant’s own evidence. He conceded
that in all the years until July 2012, he had accepted the prices of carcasses, even
when there was no downward adjustment that he wished for. On those occasions
he had made a loss or a very small profit. As the defendant put it: ‘So there were
times when I did not agree and then I just tried to deal with it’ (My translation).3

3 ‘So daar is tye wat ek nie saamgestem het nie en dan het ek dit maar probeer verwerk.’

And contrary to the defendant’s assertion, there was simply no evidence that the
plaintiff had undertaken to furnish him with written reasons if it was unable to
adjust its prices.

[24] The facts militate against an inference of any planned strategy to exclude
the defendant from the contractual arrangement with the view to taking over his
customers. Rather, the evidence shows the contrary. It was never suggested, nor
could it be, that the meeting at Bonnievale was not a genuine attempt to resolve
the impasse on price. The defendant’s own actions after that meeting are
consistent with his acceptance that the parties’ business relationship had come to
an end.

[25] On 24 July 2012, some seven days after the Bonnievale meeting – and after
the plaintiff allegedly had sold pork products to his customer, Striker Meats – the
defendant wrote to the plaintiff as follows:
‘Due to your action to market pigs on your own it is very important that I must know the
following:
1.
Availability of pigs from today until the 1st of October.
2.
Availability from the 1st October forward.
I need your urgent reply because I have to secure my business and for future marketing.’
This letter does not contain a hint of any breach of contract, let alone that the
plaintiff had breached the distribution agreement, by refusing to adjust its pork
prices downwards and delivering insufficient product to the defendant, as alleged
in the counterclaim. This, when on the defendant’s version the supply and
distributorship agreements were still extant. The letter also says nothing about
unlawful competition.

[26] What is more, in a letter to the plaintiff dated 4 September 2012, the
defendant proposed a new arrangement. He expressed his willingness to sell all

the plaintiff’s pigs to customers at fixed prices to be agreed upon. He suggested
that certain customers be charged a higher price than others. In evidence the
defendant conceded that this was an attempt to conclude a new agreement with
the plaintiff. It was the clearest indication that the defendant accepted that the
parties’ contractual arrangement had terminated at the end of July 2012. The full
court thus correctly concluded that the cancellation question, ie whether the
plaintiff had cancelled the contractual arrangement because the defendant had
bought carcasses from a competitor, was immaterial.

[27] Moreover, the attempt to conclude a new agreement was directly at odds
with the defendant’s case that the plaintiff had from ‘September 2012 onwards,
in breach of the (still existing) agreement’ sold products directly to his customers.
And when he wrote the letter of 4 September 2012, the defendant himself was
delivering pork products on behalf of the plaintiff to his former customers.

[28] It was common ground that there was never a fixed price and the standard
according to which the price had to be determined, had to be market related.
Although the concept ‘market related price’ is not a precisely defined term, it was
not necessary for the parties, in order for their contract to be valid and not void
for vagueness, to formulate a precise mathematical criterion for the determination
of the price.4 The parties had to negotiate the price for each sale. They had always
managed to reach agreement on price or, at the very least, the defendant accepted
the price even in the absence of a downward adjustment that he sought, until 2012,
when there was a deadlock: the parties could not reach consensus. There was no
objectively determinable external standard or mechanism to resolve this
deadlock, such as the determination of the price by a third party.5

4 Letaba Sawmills (Edms) Bpk v Majovi (Edms) Bpk [1993] 1 All SA 359; 1993 (1) SA 768 (A) at 775A-C.
5 Compare Letaba Sawmills (Edms) Bpk v Majovi (Edms) Bpk [1993] 1 All SA 359; 1993 (1) SA 768 (A) at 774B-
C.

[29] The submission by the defendant’s counsel that there was an external
standard according to which the price could be determined, namely reasonable
and market related wholesale prices that followed market fluctuations, is correct.
But this was not a deadlock-breaking mechanism. The market related price was
simply a measure according to which prices would be negotiated. It was no more
than an indicator that oriented the parties to prices at which carcasses generally
were sold in the industry: the relevant market would provide the framework
within which the prices for carcasses in each sale would be negotiated and
determined. Put differently, the parties agreed that the price of carcasses would
be related or connected to pork market prices, and determined by negotiation.
They did not agree that the price of carcasses would be charged at the prevailing
market price in the various contracts of sale, or in the event that the parties could
not themselves agree on a price.

[30] The defendant’s claim for damages in contract was based on the plaintiff’s
alleged breach of the sole distributorship agreement. The defendant claimed that
the plaintiff, utilising confidential information (obtained by virtue of the cession
of book debts), had canvassed his category A customers and sold pork products
to them at lower prices, between the end of June 2012 and the end of February
2013. From September 2012 onwards the plaintiff sold directly to the defendant’s
category B customers. It was argued that the plaintiff had wilfully created the
situation in June/July 2012 so as to ‘convert’ itself to a wholesaler, on the back
and in the place of the defendant.

[31] When the parties could not reach consensus on the price of carcasses in
July 2012, the contractual arrangement, and with it the sole distributorship
agreement, came to an end. On the facts, the defendant thereafter raised no
complaint of breach of contract (or unlawful competition) by the plaintiff. He
continued to purchase carcasses from the plaintiff on an ad hoc basis on credit,

but in lesser quantities, secured by the credit facility. Contrary to the conclusion
of the trial court, there was nothing ‘ludicrous’ about the credit facility and the
cession of book debts continuing in existence after the termination of the parties’
business relationship. The defendant accordingly had no enforceable cause of
action in contract.6

[32] Before us counsel for the defendant fairly conceded that in the absence of
direct evidence of a planned strategy by the plaintiff to exclude the defendant as
the middleman (or engineering a situation so as to become a wholesaler), the
Court was asked to draw such an inference from the proved facts. Given the facts
stated in paragraph 24 to 26 above, and specifically the parties’ efforts to resolve
the impasse on price in 2012 and the defendant’s attempt to negotiate a new
contract, the inference sought is neither plausible nor readily apparent.7 Any
suggestion that Mr Broodryk, the owner of Bonnievale Abattoir, was party to a
scheme to take over the defendant’s business, is absurd.

[33] Regarding the plaintiff’s claim for contractual damages, the trial court
made findings of fact that were unsupported by the evidence, and critical to its
decision that the defendant had established liability on the part of the plaintiff. It
found that in the cession of book debts, the plaintiff:
‘. . . actually confirmed in writing that it has access to confidential information that is of
substantial value to the defendant and in respect of which the defendant is entitled to
protection.’
The judge went on to say:
‘. . . I see no reason why the plaintiff should not be held liable to that which it agreed to in
writing in this regard.’

6 Liberty Group Ltd and Others v Mall Space Management CC t/a Mall Space Management [2019] ZASCA 142;
2020 (1) SA 30 (SCA) para 32.
7 Ocean Accident and Guarantee Corporation Ltd v Koch 1963 (4) SA 147 (A) at 159A-D, affirmed in Kruger v
National Director of Public Prosecutions [2019] ZACC 13; 2019 (6) BCLR 703 (CC) para 79.

[34] Aside from the defendant’s credit application, the cession of book debts
was the only written agreement concluded between the parties. The cession
however contains no acknowledgement by the plaintiff of access to confidential
information in respect of which the defendant was entitled to protection. In fact,
the defendant’s case was that the plaintiff had orally agreed to non-disclosure of
confidential information: the counterclaim states that it ‘was understood that in
the course of the Supplier/Distributor Agreement the parties would become privy
to confidential information and operational secrets’.8 And the defendant adduced
no evidence of this so-called confidential information and operational secrets.
Solely for these reasons, the trial court’s order that the defendant had established
liability on the part of the plaintiff was unsustainable.

[35] There are further reasons why the order cannot be sustained. The trial court
stated that the facts of the matter were ‘tantamount to a restraint agreement’, and
that ‘unlawful interference in the business of the defendant’ could ‘occur in
various forms’. It then proceeded to apply the principles relating to restraint of
trade agreements to the contractual relationship between the parties and held that
‘the defendant had a protectable interest in the form of confidential information
that the plaintiff had access to’, which the plaintiff had breached. The judge
concluded:
‘I thus find that the plaintiff has failed to discharge the burden of proving that the restraints are
not justified on the basis of protecting confidential information or trade connections. The
contractual terms in the distribution agreement for the protection of confidential information
are enforceable.’

[36] There was of course no onus on the plaintiff to prove any of the claims
asserted in the defendant’s counterclaim. The trial court conflated unlawful
interference in the defendant’s business (unlawful interference with contractual

8 Emphasis added.

relations – a delictual claim) with agreements in restraint of trade. It then applied
the principles in Basson9 concerning the reasonableness of a restraint of trade
agreement and came to the conclusion that the defendant had breached the sole
distributorship agreement, ie that its terms were enforceable. This was a material
error of law: there was no restraint of trade agreement between the parties. The
issue was whether the plaintiff had breached the sole distributorship agreement
or competed unlawfully with the defendant.

[37] Furthermore, the information that the defendant furnished in the cession of
book debts was not given in circumstances giving rise to an obligation of
confidence. The cession of book debts was nothing more than a standard security
cession concluded by a debtor buying goods from a supplier. For such cession to
be effective, the cessionary must necessarily have access to details of the cedent’s
debtors and the prices at which it sells goods to them in order to enforce its rights
under the agreement.

[38] Apart from this, the information furnished by the defendant was not
confidential in nature, having the necessary quality of confidence deserving of
protection. The prices of pork products, the main participants in the industry who
were fiercely competitive, who their customers were and the prices charged by
them, were all matters of public knowledge. Indeed, the evidence shows that the
defendant had utilised this very information, which was in the public domain,
when negotiating prices with the plaintiff in the various contracts of sale.

[39] What all of this shows is that the defendant failed to prove that the plaintiff
had breached the sole distributorship agreement. The full court rightly dismissed
his claim on this ground.

9 Basson v Chilwan and Others [1993] 2 All SA 373 (A); 1993 (3) SA 742 (A) at 767F-H.

[40] The defendant’s alternative claim of unlawful competition can be dealt
with shortly. It was submitted that the plaintiff’s conduct was ‘the most classic
case of unlawful interference with a contractual relationship’, and that it wilfully
created the situation in July 2012 to become a wholesaler in place of the
defendant. The latter submission however has no basis in the evidence for the
reasons already advanced.

[41] In Schultz v Butt,10 unfair competition was described thus:
‘As a general rule, every person is entitled freely to carry on his trade or business in competition
with his rivals. But the competition must remain within lawful bounds. If it is carried on
unlawfully, in the sense that it involves a wrongful interference with another’s rights as a trader,
that constitutes an injuria for which the Aquilian action lies if it has directly resulted in loss.’

[42] Since the delict of unlawful competition is based on the Aquilian action,
the defendant had to prove wrongfulness. It is only when the competition is
wrongful that it becomes actionable. In Phumelela v Gründlingh,11 the
Constitutional Court formulated the test for wrongfulness as follows:
‘The question is whether, according to the legal convictions of the community the competition
or the infringement on the goodwill is reasonable or fair when seen through the prism of the
spirit, purport and objects of the Bill of Rights. Several factors are relevant and must be taken
into account and evaluated. These factors include the honesty and fairness of the conduct
involved, the morals of the trade sector involved, the protection that positive law already
affords, the importance of competition in our economic system, the question whether the parties
are competitors, conventions with other countries and the motive of the actor.’

[43] The defendant simply failed to establish wrongfulness. The plaintiff’s
conduct would have been wrongful only if it had intentionally induced the

10 Schultz v Butt [1986] 2 All SA 403 (A); 1986 (3) SA 667 (A) at 678F-H.
11 Phumelela Gaming and Leisure Limited v Gründlingh and Others [2006] ZACC 6; 2006 (8) BCLR 883 (CC);
2007 (6) SA 350 (CC) para 34; Masstores (Pty) Limited v Pick ‘n Pay Retailers (Pty) Ltd [2016] ZACC 42; 2017
(1) SA 613 (CC); 2017 (2) BCLR 152 (CC) para 29.

defendant’s customers to breach their contract with him.12 There was however no
evidence as to the nature and content of any contractual relationship between the
defendant and any of his customers. The high watermark of his case on this score
was that he had been informed by the owner of Striker Meats that the plaintiff
had decided to exclude the defendant from the sale of pork products, which in
any event was inadmissible hearsay evidence. In short, there was no factual or
legal basis for the defendant’s claim of unlawful competition.

[44] What remains is the submission on behalf of the defendant that the trial
judge had made ‘strong and well-reasoned credibility findings’ against the
plaintiff’s main witness, Mr Burger, to which the full court was bound. It suffices
to say that the full court was in a position to come to a clear conclusion that the
trial court was plainly wrong, and little weight could be attached to its credibility
findings.13 Regarding costs, both parties were ably represented by only senior
counsel in the trial and the appeal before the full court. Consequently, the costs
of two counsel in this appeal are not justified.

[45] In the result, the appeal is dismissed with costs, including the costs of only
senior counsel.

___________________
A SCHIPPERS
JUDGE OF APPEAL

12 Masstores (Pty) Limited v Pick ‘n Pay Retailers (Pty) Ltd [2015] ZASCA 164; 2016 (2) SA 586 (SCA); [2016]
2 All SA 351 (SCA) para 22.
13 Bernert v Absa Bank Ltd [2010] ZACC 28; 2011 (4) BCLR 329 (CC); 2011 (3) SA 92 (CC) para 106.

Appearances

For appellant:
R S van Riet SC
Instructed by:
Dirk Kotze Attorneys, Cape Town

Symington & De Kok Attorneys, Bloemfontein

For respondent:
A Beyleveld SC and I Bands
Instructed by:
Wheeldon Rushmere & Cole Inc, Cape Town

Honey Attorneys, Bloemfontein

THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
MEDIA SUMMARY OF JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL
From:
The Registrar, Supreme Court of Appeal
Date:
1 December 2021
Status:
Immediate
The following summary is for the benefit of the media in the reporting of this case and does not form
part of the judgments of the Supreme Court of Appeal
Van der Merwe v Bonnievale Piggery (Pty) Ltd (749/2020) [2021] ZASCA 162 (1 December 2021)
Today the Supreme Court of Appeal (SCA) dismissed an appeal by the appellant with costs, including
the costs of senior counsel.

The appellant, Mr Edwin van der Merwe (the plaintiff), is a former seller of pork products. The
respondent, Bonnievale Piggery (Pty) Ltd (the defendant), keeps and rears pigs for slaughter. In 2005
the parties entered into a business relationship which included contracts for the sale of pork products
concluded on the basis of periodically agreed prices, an exclusive supply agreement and a sole
distributorship agreement. Their business relationship and the interlinked contracts were of indefinite
duration, terminable at the instance of either party. In terms of the sales agreement the parties agreed
that the plaintiff would sell pork products to the defendant at reasonable, market-related wholesale
prices that would follow market fluctuations. Under the supply agreement the plaintiff agreed to supply
pork products exclusively to the defendant. In terms of the sole distributorship agreement the defendant
would be the sole distributor of the plaintiff’s products under his own brand to customers in the Western
Cape.

In 2013 the plaintiff instituted action against the defendant for payment of R1 196 868,84, for pork
products supplied. The defendant admitted receipt of these products and that he was liable to pay for
them, but alleged that he had a counterclaim against the plaintiff for some R12,5 million for breach of
contract, alternatively unlawful competition. The Western Cape Division of the High Court, Cape Town
(the high court), dismissed the plaintiff’s claim and upheld the defendant’s counterclaim. The court
made an order that the defendant had successfully established liability by the plaintiff and was entitled
to claim such damages as may be proved in due course. The plaintiff was granted leave to appeal to a
full bench of the high court.

The full court held that the business relationship between the parties had come to an end in July 2012
when they could not agree on a price for pork products, and that the appellant’s counterclaim based on
breach of contract and unlawful competition could not be sustained on the evidence. The full court set
aside the trial court’s order and granted judgment against the appellant in favour of the respondent for
payment of the sum of R1 196 868,84, together with interest and costs. It dismissed the claim in
reconvention with costs. The defendant was granted leave to appeal to the SCA.

The SCA held that plaintiff had proved its claim and that the defendant had not proved his counterclaim
based on breach of contract or unlawful competition. It held that the full court was correct in concluding

that the parties’ business relationship had come to an end in July 2012 when they could not agree on
the price of pork products. The defendant did not prove his counterclaim for breach of contract. In
seeking to conclude a new agreement with the plaintiff in September 2012, he had accepted that their
business relationship ended in July 2012. The defendant also failed to prove his claim for unlawful
competition. He presented no evidence to show that the plaintiff had interfered in the contractual
relationships between him and his customers. The appeal was accordingly dismissed.

--------oOo--------