In this case the Appellant, Viziya Corporation (“Viziya”) brought an application for leave appeal to the Supreme Court of Appeal against the judgement as handed down by the court a quo, the Gauteng Division of the High Court, Pretoria and against the refusal to grant leave to appeal in the same court.
The court set aside an Anton Piller Order that had been granted in favour of Viziya. The Anton Piller Order was set aside following a successful reconsideration application brought by the respondent Collaborit Holdings (Pty) Ltd and others (“Collaborit”). Viziya requested leave to appeal against the successful reconsideration application which was refused.
The legal question in this case surrounded whether leave to appeal should be granted or and whether the court a quo properly exercised its discretion when it discharged the Anton Piller Order.
The factual matrix of the case and the events leading to the Appeal are as follows:
On 25 August 2014, Viziya, a company that develops and sells computer systems and software, concluded an agreement (“the Agreement”), with Collaborit in terms of which Collaborit was to facilitate the referral and sale of Viziya’s products and services. In return for such referrals, Collaborit would be paid fees in accordance with a formula set out in the Agreement;
The Agreement contained two crucial provisions that were pertinent to the litigation of this matter. The first provision required Collaborit to use all necessary precautions to ensure that disclosure of Viziya’s proprietary property would not be made available to a competitor or a suspected competitor of Viziya;
The second provision prohibited Collaborit from selling and developing work products that are competitive to Viziya products. In and during November 2015, the Agreement was terminated pursuant to a notice given to Collaborit. Viziya subsequently alleged that during the period of the Agreement, and in breach of the provisions of the Agreement, Collaborit developed its own work products which it marketed and sold in unlawful competition with Viziya; and
Viziya alleged that these products did not exist when the Agreement was concluded and that Collaborit endeavoured to market this product in unlawful competition with them and that such action was in breach of the Agreement.
It was on these allegations that Viziya brought an ex-parte Application for an Anton Piller order in the High Court, which was heard and granted in chambers. At a later stage, Collaborit brought an Application to set aside the order. The High Court granted the Application and discharged the order and subsequently refused Viziya leave to appeal. It is against the order refusing leave to appeal that Viziya appealed to the Supreme Court of Appeal.
In its judgement, the High Court found that Viziya had satisfied the first 2 (Two) requirements of an Anton Piller order namely that:
- Viziya had prima facie established a cause of action against Collaborit which it intended to pursue; and
- Viziya had in its possession documents or things which constituted vital evidence in substantiation of Viziya’s cause of action.
In exercising its discretion whether or not to grant an Anton Piller order, the court must pay regard to, inter alia, the cogency of the prima facie case established, the potential harm that will be suffered by the respondent if the remedy is granted as compared with or balanced against the potential harm to the applicant if the remedy is withheld. The requirement of a prima facie cause of action is simply that an applicant should show no more than that there is evidence which, if accepted, will establish a cause of action. The Anton Piller order is made where a reasonable fear exists that the respondent may in the normal course not discharge its duty to make full discovery. The establishment of an element of dishonesty in the conduct of a respondent must ordinarily give rise to a fear that vital evidence may be concealed or that the respondent may not make full discovery.
The High Court, however, held that Collaborit failed to establish that there was a real and well-founded apprehension that this evidence which was preserved by means of the Anton Piller Order might be hidden or destroyed or in some manner be spirited away by the time the case came to trial or to the stage of discovery. It accordingly discharged the Anton Piller Order and, additionally, refused Viziya’s request for leave to appeal on the grounds that there were no reasonable prospects of success on appeal.
The Supreme Court of Appeal held, on appeal, that Viziya’s simultaneous Application for leave to lead further evidence be dismissed and subsequently found that Viziya had fail to identify or specify which vital information was in the possession of Collaborit that needed to be preserved. It held that a blanket search for unspecified documents or evidence which may or may not exist is not permitted. The court further held that the proposed broad and general keyword search was invasive and amounted to a trawling expedition through every aspect of
Collaborit’s business. The Supreme Court of Appeal concluded that the High Court erred in categorising the information sought by Viziya as vital and specific and thus concluded that the ex-parte Order was wide and expansive. In the circumstances, the reconsideration application by the Respondent was correctly granted.
The Supreme Court of Appeal held further, that, Viziya failed to show that Collaborit was untrustworthy or dishonest and that Viziya failed to show why Collaborit would destroy or conceal information whilst continuing to market its rival products. In the premises, the court a quo was correct in discharging the Anton Piller Order and refusing
In short, the court held that the merits of Viziya’s case was so poor that the refusal of leave to appeal was appropriate. As a result, the Appeal was dismissed on both grounds with costs.
This case highlights the importance of the requirements in respect of Anton Piller Orders and the prospects of success on appeal.
Written by Justin Howard and supervised by Jasvir Sewnarain , 19 February 2019