Replication Technology Group and Others v Gallo Africa Ltd

• Jurisdiction: South Africa

Replication Technology Group and Others v Gallo Africa Ltd
2009 (5) SA 531 (GSJ)

2009 (5) SA p531

Citation	2009 (5) SA 531 (GSJ)
Case No	08/36580
Court	South Gauteng High Court, Johannesburg
Judge	Malan J
Heard	March 16, 2009
Judgment	April 15, 2009
Counsel	WJ de Bruyn and M Welz for the applicants.; P Ginsburg SC (with G Marriott) for the respondent.

Flynote : Sleutelwoorde E

Arbitration — Arbitration agreement — Naturalia — Whether including English F law concept of 'implied undertaking' of confidentiality by party to whom discovery has been made not to use documents disclosed in other proceedings — Applicants in contempt proceedings seeking to rely on documents disclosed by respondent in arbitration proceedings between parties - Semble: Even if 'implied undertaking' forming part of South African law, facts falling within two of recognised exceptions to rule — G Accordingly, documents disclosed in arbitration proceedings being admissible in contempt proceedings.

Discovery and inspection — Confidential documents — Court has discretion to place limitations on litigants' right of inspection and copying — Circumstances in which discovered documents may be used in other proceedings H — English practice of 'implied undertaking' discussed.

Discovery and inspection — Discovery — Documents — Use of discovered documents in other proceedings — Applicants in contempt proceedings seeking to rely on documents disclosed by respondent in arbitration proceedings between parties — Whether naturalia of arbitration agreement I including English law 'implied undertaking' of confidentiality by party to whom discovery has been made not to use documents disclosed in other proceedings — Semble: Even if 'implied undertaking' forming part of South African law, facts falling within two of recognised exceptions to rule — Accordingly, documents disclosed in arbitration proceedings being admissible in contempt proceedings. J

2009 (5) SA p532

Headnote : Kopnota

A The respondent (Gallo) launched contempt proceedings against the applicants in the High Court. In support of its application, it sought to use a number of documents and certain information derived from those documents, all of which came to its knowledge after the applicants had disclosed them on discovery during an arbitration which preceded the present application. The applicants sought an interdict prohibiting Gallo from using B those documents in the contempt proceedings and from using any information derived from them. The applicants, in addition, sought the striking-out of all such documents and information from the founding papers in the contempt application. The applicants contended that the English law notion of an implied undertaking by a litigant, to whom discovery had been made, not to use the documents disclosed in other proceedings or for an C ulterior purpose, which had been incorporated by implication into South African law in the context of civil proceedings, also applied to arbitration proceedings.

Held, that there was no legislative basis for the privacy and confidentiality of arbitration proceedings in South Africa. An arbitration agreement could expressly provide that the proceedings and the award are private and D confidential, but 'even in the absence of an express provision to this effect, such a term will be implied.' The term suggested seemed to be a term implied by law as being one of the naturalia of the agreement to arbitrate. Courts had the inherent power to develop the law by implying a term into particular types of agreements, thereby formulating a new rule of law. That would be done cautiously and on grounds of policy. (Paragraph E [16] at 545H - 546B/C.)

Held, further, that, however, the court was not required to determine whether the English 'implied undertaking' formed part of South African law. Even if the court accepted that the English rule had been accepted in South Africa, there were a number of exceptions to the rule. Two of these were particularly relevant. First, disclosure was permitted when, and to the F extent to which, it was reasonably necessary for the protection of the legitimate interests of an arbitrating party. In the current context, the use of the arbitration documents to found a cause of action for contempt of court against another arbitrating party would be 'reasonably necessary'. Second, English law permitted disclosure of arbitration evidence and documents where it was in the interests of justice to do so. Although it had been said G that leave of the court was required before disclosure could be made, in an application for contempt of court that should not be required. (Paragraph [17] at 548C - 549A.)

Held, accordingly, that the application to strike out was dismissed. (Paragraph [20] at 550C.)

Cases Considered

Annotations H

Reported cases

Southern Africa

Alfred McAlpine & Son (Pty) Ltd v Transvaal Provincial Administration 1974 (3) SA 506 (A): referred to

Anglo Operations Ltd v Sandhurst Estates (Pty) Ltd 2006 (1) SA 350 (T) (2006 (4) BCLR 492): referred to I

City of Cape Town (CMC Administration) v Bourbon-Leftley and Another NNO 2006 (3) SA 488 (SCA) ([2006] 1 All SA 561): referred to

Crown Cork & Seal Co Inc and Another v Rheem South Africa (Pty) Ltd and Others 1980 (3) SA 1093 (W): referred to

Ex parte Sapan Trading (Pty) Ltd 1995 (1) SA 218 (W): referred to J

2009 (5) SA p533

Fakie NO v CCII Systems (Pty) Ltd 2006 (4) SA 326 (SCA): referred to A

Federal Wine and Brandy Co Ltd v Kantor 1958 (4) SA 735 (E): referred to

Federation of Governing Bodies of South African Schools (Gauteng) v MEC for Education, Gauteng 2002 (1) SA 660 (T): referred to

Ferreira v Endley 1966 (3) SA 618 (E): referred to

General Accident, Fire and Life Assurance Corporation Ltd v Goldberg 1912 TPD 494: referred to B

Giddey NO v JC Barnard and Partners 2007 (5) SA 525 (CC) (2007 (2) BCLR 125): referred to

Gore v Amalgamated Mining Holdings 1985 (1) SA 294 (C): referred to

Lenz Township Co (Pty) Ltd v Munnick and Others 1959 (4) SA 567 (T): referred to

Maxwell and Another v Rosenberg and Others 1927 WLD 1: referred to C

Rellams (Pty) Ltd v James Brown & Hamer Ltd 1983 (1) SA 556 (N): referred to

Schoeman v Constantia Insurance Co Ltd 2003 (6) SA 313 (SCA) ([2003] 6 All SA 642): compared

South African Forestry Co Ltd v York Timbers Ltd 2005 (3) SA 323 (SCA) ([2004] 4 All SA 168): referred to D

Van Nieuwkerk v McCrae 2007 (5) SA 21 (W): referred to

Van Vuuren v Agricura Laboratoria (Edms) Bpk 1974 (2) SA 324 (NC): referred to.

Foreign

Australia

Esso Australia Resources Ltd v Plowman E [1995] HCA 19 ((1995) 128 ALR 391; (1995) 69 ALJR 404; (1995) 183 CLR 10): referred to.

Canada

Juman v Douchette [2008] 1 SCR 157: referred to

Tanner v Clark (2003) 63 OR (3d) 508 (CA): referred to.

England F

Ali Shipping Corporation v Shipyard Trogir [1977] App LR 12/19 (CA): dicta in paras [36] and [38] applied

Alterskye v Scott [1948] 1 All ER 469 (Ch D): referred to

Church of Scientology of California v Department of Health and Social Security [1979] 1 WLR 723 (CA): referred to G

Crest Homes plc v Marks and Others [1987] 1 AC 829 (HL) ([1987] 2 All ER 1074): dictum at 860G - H applied

Dadourian Group International Inc v Simms [2006] EWCA 1745: referred to

Dolling-Baker v Merrett [1991] 1 All ER 890 (CA) ([1990] 1 WLR 1205): referred to

Emmott v Michael Wilson & Partners Ltd [2008] 2 All ER (Comm) 193 (CA): referred to H

Halcon International Inc v Shell Transport and Trading Co and Others (1997) RPC 79 121: referred to

Hassneh Insurance Co of Israel and Others v Steuart J Mew [1993] 2 Lloyd's Rep 243 (QB): referred to

Marcel v Metropolitan Police Commissioner [1992] Ch 225 (CA) ([1992] 1 All ER 72): referred to I

Riddick v Thames Board Mills Ltd [1977] 3 All ER 677 (CA): referred to

Scally and Others v Southern Health and Social Services Board and Another [1992] 1 AC 294 (HL) 307: referred to

Sunderland Steamship P and I Association v Gatoil International (The Lorenzo Halcoussi) [1988] 1 Lloyd's Rep 180 (QB) 184: referred to J

2009 (5) SA p534

Tournier v National Provincial and Union Bank of England (1924) 1 KB 461 (CA): referred to. A

Case Information

Application to strike out. The facts appear from the reasons for judgment.

WJ de Bruyn and M Welz for the applicants. B

P Ginsburg SC (with G Marriott) for the respondent.

Cur adv vult.

Postea (April 15). C

Judgment

Malan J:

[1] The respondent (Gallo) has launched contempt proceedings against the applicants. In support of its application it wants to use a number of D documents and certain information derived from those documents, all of which came to Gallo's knowledge in consequence of the applicants' having disclosed them on discovery during an arbitration which preceded the present application. The applicants seek an interdict prohibiting Gallo from using those documents in the contempt proceedings and from using any information derived from them. The applicants, in E addition, seek the striking-out of all such documents and information from the founding papers in the contempt application. The parties have been involved in previous litigation in different capacities. The directors of the first applicant are the second to sixth applicants. Gallo is the applicant in the contempt application and the applicants are the F respondents. Gallo is the claimant in the arbitration and the first applicant the defendant.

[2] On 5 April 2002 the first applicant and Gallo concluded an agreement of sale in terms whereof Gallo acquired the first applicant's shareholding in CDT, a company. Pursuant to the sale CDT became a G wholly owned subsidiary of Gallo. Subsequently, a dispute developed between the parties regarding a restraint of trade provision in the sale agreement...