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If you have a smartphone, you probably use Whatsapp daily. This handy little app has 1,3 billion monthly active users, but is often controversial – sending your data to Facebook for targeted adverts and friend suggestions, and encrypting communications to lock out cybercriminals but also government agencies investigating terror networks.

Our whatsapp conversations are increasingly being entered into evidence in court proceedings.

A Saudi man reported that he divorced his wife after the app showed that she had received and read his messages, but failed to respond to any of them. This process, known as “blue ticking” in reference to the little blue ticks that show that your message has been displayed on the recipient’s phone, also played a role in a Taiwanese woman’s divorce. She submitted evidence of her husband continually ignoring her messages, and this was accepted as evidence that the marriage had irreparably broken down.

An Italian divorce lawyer reported that evidence of whatsapp messages between spouses and their extra-marital partners was being used in around half of the divorce cases going to trial there.

Closer to home, the country scrutinised emotional whatsapp messages exchanged between murder convict Oscar Pistorius and his victim Reeva Steenkamp, provided as evidence of a tumultuous and emotionally abusive relationship.

Increasingly, even business negotiations may take place via whatsapp. But are these communications legally binding?

The Electronic Communications and Transactions Act of 2002 (ECTA) gives formal legal recognition to transactions concluded by email. The Act obliges courts interpreting its provisions to recognise and accommodate electronic communications in applying statute or common law.

Our law recognises a data message (such as an email or whatsapp message) as adequate in most cases where the law or an agreement requires something to be in writing. Notable exceptions where agreements cannot be concluded electronically include deeds of sale of immovable property, and last wills and testaments – even where an advanced electronic signature is used.

The law or an agreement may also require that a document be signed by a party. The question then arises as to whether one can sign a document via email or whatsapp. This question was recently considered by the Supreme Court of Appeal (SCA), in the case of Spring Forest Trading (SFT) versus Wilberry (W).

W owned car wash equipment, and contracted with SFT to operate car washes at several locations, using its equipment, for which SFT paid W rentals. SFT fell into arrears, and the parties entered into discussions to remedy the situation. A face-to-face meeting was held, after which SFT’s representative emailed W’s representative, recording in writing four proposals which W had offered it. The second proposal was recorded as “Cancel agreement and walk away.” SFT sought confirmation that, if this proposal was pursued, there would be no legal claims by either party.

W’s representative responded by email, confirming that, provided all rental arrears were paid, there would be no legal claims.

SFT then emailed W, advising that it accepted the second offer.

SFT returned the car wash equipment and paid the rental arrears. That might have been the end of the matter. It was not, however – SFT continued to run car washes from the same locations, now renting equipment from W’s competitor – probably not the outcome that W had foreseen.

W rushed to court on an urgent basis, claiming that its agreements with SFT had not been validly cancelled, and seeking an interdict to prevent SFT from operating car washes while it prosecuted a claim for damages. The High Court was sympathetic, and granted an interdict, agreeing that the agreements had not been validly cancelled. The judge deciding the matter found that the agreements – which required consensual cancellations to be reduced to writing and signed by both parties – did not allow for cancellation via an exchange of emails.

SFT appealed this judgment to the SCA. It relied upon ECTA, which states that, where parties to an electronic transaction require an electronic signature, but have not agreed upon the type of electronic signature, then the requirement is met if (1) a method is used which identifies the person and indicates their approval of the information communicated and (2) the method was as reliable as was appropriate for the purposes for which the information was communicated, having regard to all the circumstances. It argued that the consensual cancellation had been reduced to writing in the form of the exchange of emails, and had been signed by the parties when they ended each email by typing their full names.

W disagreed, arguing that (1) the emails were evidence of negotiations but could not constitute an actual agreement to cancel, (2) at best, the emails only referred to the rental agreements and not the master agreement between the parties, and (3) even if ECTA applied, then an advanced electronic signature was required, and this was absent.

The SCA found: (1) the emails clearly amounted to an agreement and not mere negotiations, as the parties reached consensus that they could walk away once arrears were settled and equipment returned, with no further legal consequences and (2) “walking away” could only mean that all agreements would be cancelled.

On (3), the court examined ECTA in more detail, finding that:

  • a data message could unquestionably satisfy the requirement that an agreement be in writing;
  • an advanced electronic signature was only required where imposed by law, and not in private agreements: it involved an elaborate and strict application process, for accredited products and services only. The parties did not deal in such products or services;
  • between private parties who required a signature, a standard electronic signature would suffice.

W argued that the recordal of a party’s full names at the end of an email did not meet the ECTA requirements for an ordinary electronic signature – there was no reliable method to identify the parties and indicate their approval of the information communicated.

The court disagreed, pointing out that courts have always taken a pragmatic approach to signatures, and required that a signature authenticates a signatory’s identity, without insisting on specific forms. In appropriate cases, a witness touching the pen while a magistrate made a mark on her behalf, had been accepted as a valid signature. The typed names identified the parties, were logically connected with the information that preceded them, and satisfied the ECTA requirements for an ordinary electronic signature.

The appeal was accordingly upheld, and the interdict against SFT set aside.

Had the parties not appended their names or another form of signature to their emails, however, the requirement that a consensual cancellation be signed by both parties would not have been met, and the purported cancellation would have been ineffective.

In summary, electronic communications via email, whatsapp and other means are increasingly relied upon in commerce. Parties engaging in electronic communications in business matters should be aware that these communications may feel casual but can be legally binding upon them. Where a party is negotiating by text or email but intends for any resultant agreement to be written up and signed on the printed page before it will be binding, this should be spelled out clearly – before an “in principle” agreement is reached. Failure to do so can mean that a party is bound by the terms set out in the text exchange, while other pertinent clauses the party may have wished to insist upon will be excluded.

While email and text are convenient, in cases such as the one above, the presence or absence of a signature can have far-reaching and costly implications. When emails and texts are intended to have legal consequences, a party would be wise to ensure that these communications still fulfill all legal requirements – such as a full signature where one is required. Had the parties’ representatives ended their emails with an unsigned greetings (“Best”) or an initial for shorthand (“C”), the outcome of the case may have been quite different – and a business potentially ruined in the process.

Fair play: the role of “ground rules” in a mediation

You have made an appointment with the mediator, you have signed and returned the mediation agreement, and now you are in the chair in the mediator’s consulting room, not entirely sure what comes next.

Many mediators will start the first mediation meeting by going through ground rules for the mediation process.

Ground rules set the stage for a respectful and productive conversation. Many of them provide for the rules of etiquette that apply in any good social interaction, but which are often forgotten when tempers are raised. By agreeing upon and abiding by ground rules, a safe environment is created in which to engage fruitfully. This may not be possible outside of the mediator’s consulting room.

A mediator may suggest her own set of ground rules and ask the parties to agree to them, or may ask the parties to come up with their own ground rules. The sort of ground rules a mediator may ask parties to agree to, include:

  • Speak for yourself. Avoid engaging in blame and criticism of the other person.
  • One person speaks at a time. Do not interrupt. (The mediator reserves the right to interrupt in order to keep proceedings on track.)
  • Each person is entitled to a fair opportunity to express themselves fully.
  • Listen to understand, and delay formulating a response until you are sure that you understand what the other person is trying to communicate.
  • Treat one another with dignity and respect. No raised voices or abusive language.
  • Focus on building an agreement for the future, not rehashing the past.
  • Cell phones should be turned off, and placed out of sight, so as not to be a distraction.
  • Keep what is said in the mediation sessions, confidential.

Having agreed to these rules of engagement, the mediator will gently remind the parties of their agreement, should their communication stray away from what was agreed. In this way, the mediator aims to hold the space for both parties to fully and frankly express themselves, be heard, and offer constructive input.

Some mediators do not like to introduce ground rules, as they feel it places them in the position of a parent, refereeing squabbles between two ill-disciplined children. They prefer to expect the best from the parties, and only intervene with guidance if and when problems arise. The difficulty that arises with this approach, is that one party may feel that the mediator is showing bias against him or her, should the mediator raise ground rules after the process is already underway.

Rose Attorneys offers mediation services, with a special focus on divorce mediation.

In any divorce proceedings, a dialogue facilitated by a mediator can bring matters to a quicker and more peaceful resolution than proceeding at once to issuing summons and exchanging proposals via attorneys and court documents.

Especially where a divorcing couple must co-parent in future, a mediation process can be invaluable. While litigating tends to harden positions and further damage the parties’ relationship, mediation offers the possibility of reducing tensions, and building new foundations for a constructive future co-parenting relationship.

If you are interested in more information about divorce mediation, contact Camilla Rose at camilla@roseattorneys.co.za or 074 697 2048.

Halting the harassment: the scope of protection available under the Protection from Harassment Act of 2011

The Protection from Harassment Act became law four years ago. In The new Protection from Harassment Act we examined the new Act, which vastly strengthened the capacity of magistrates to bring harassment to a decisive halt, by means of a cost-effective and user-friendly process.

In the intervening period, very little jurisprudence has developed to guide the future interpretation and application of the Act. One judgment emerged in 2016, from the KZN High Court, however, and has significant implications for the scope of protection available under the Act.

In Mnyandu versus Padayachi, the complainant and respondent were colleagues. The respondent was aggrieved by the conduct of the complainant (her immediate senior) and others at a meeting. As a result, she sent a single email to various people in the workplace, in which she accused the complainant and others of verbally and emotionally abusing her in the meeting. The complainant was in turn aggrieved that the allegations were untrue, and approached the magistrates court for a protection order in terms of the Act. The magistrate found that the respondent’s allegations of abuse were wholly untrue, and issued a protection order as requested, restraining the complainant from defaming the complainant or sending further malicious emails. The respondent appealed the order to the High Court.

The High Court found no basis to interfere with the magistrate’s assessment of the evidence. An email had been sent, which had contained malicious falsehoods about the complainant. For the High Court, however, this was not the end of the story.

The High Court reflected that the ambit of the Act is comprehensive. On the face of it, it covers all sorts of conduct causing all sorts of harm. The court was concerned that too wide a construction of the term “harassment” would result in a flood of applications arising from conduct that the Act was simply not intended to cover. On the other hand, the Act could not be interpreted too restrictively, or the Act would fail to meet its objectives.

The court considered a Law Reform Commission discussion paper on stalking, which contributed to the development of the Act, as well as the wording and interpretation of similar laws in other countries around the world. It then formulated the following test for harassment in terms of the Act:

1. the conduct complained of had to be “oppressive and unreasonable” in order to qualify as harassment under the Act;
2. this was to be assessed objectively, by considering the qualities of the respondent’s conduct rather than the subjective impact on the complainant, although the social context could be relevant; and
3. such conduct had to be sufficiently serious that it was objectively likely to cause not merely a degree of alarm, but serious fear, alarm and distress.

The court further expressed a non-binding view that, while the Act does not refer in its definition of harassment to a “course of conduct”, the conduct complained of should probably:

1. Have a repetitive element that made it oppressive and unreasonable, tormenting or inculcating serious fear or distress in the victim; or
2. Be of such an overwhelmingly oppressive nature that a single act had the same consequences.

The court found that the respondent’s conduct in sending the untrue email was unreasonable, but not objectively oppressive or of sufficient gravity. It therefore did not constitute harassment for the purposes of the Act. The final protection order was set aside on appeal.

This judgment indicates that, while the Act itself is incredibly broad and seems to encompass a huge range of misdemeanours, it will be interpreted on narrower grounds. Protection orders are likely to be refused when the incidents complained of are deemed minor, or unreasonable but not oppressive. The conduct must be such that it would cause a reasonable person serious fear or distress, and not merely annoyance or mild alarm.

 

The enforcability of restraints of trade

Employing a key staff member can feel like risky business. They will get to know your clients, your systems, your “tricks of the trade”. All well and good: you want your staff to be well-liked by your customers, and knowledgeable and effective in their work. But what if, having accepted your training and support to become a true asset to your organisation, your employee leaves and goes to work for your competition? Can you include clauses in your employment contract to prevent this?

A well-known labour law consultancy certainly hoped so when they employed Mr DJ in 2014. His employment contract included extensive confidentiality and restraint of trade clauses, which the Labour Appeal Court adjudicated upon last week.

After about 15 months’ employment, DJ resigned to take up employment with an employer’s organisation who competed with the consultancy to offer similar services to similar clients. His employment contract restrained him in perpetuity from disclosing any client lists, trade secrets of other company information received from the consultancy during his employment. It went on to restrain him from having any interest in any other entity providing similar services to the consultancy, engaging in any similar transactions with any of the consultancy’s clients, or in any way poaching the consultancy’s staff, for a period of 3 years after his resignation, throughout two provinces of South Africa.

The consultancy immediately drew DJ’s attention to the above restraints, and alerted him to their view that he was about to breach his obligations by taking up employment with the employers’ organisation. DJ disagreed that the two organisations were in competition with one another, but nevertheless undertook not to contact any of the consultancy’s clients to attempt to lure their business away.

The consultancy was not satisfied, and launched urgent proceedings  to interdict DJ and the employers’ organisation concerned, from entering into an employment relationship. The consultancy expressed the fear that DJ would take unfair advantage of his knowledge of its clients, pricing and business strategies, and abuse the strong relationships he built up with its clients to lure them away. DJ denied having any special access to the consultancy’s business strategies, saying that he had learned these before starting work for it and that the information was in any event readily available on the internet. He aso denied having any special bond with any of the consultancy’s clients.

The Labour Court was not satisfied that there was special, confidential information in DJ’s possession which could be abused to the detriment of the consultancy. Neither was it satisfied that DJ had been shown to enjoy especially close relationships with the consultancy’s clients. The consultancy had not proven that it had any protectable interest, and to enforce the restraint would be unreasonable as against DJ and only have the effect of stifling competition.

The consultancy approached the Labour Appeal Court with an appeal against this decision. It complained that DJ had entered employment with it as a blank slate, and had only become a valuable asset worthy of being head-hunted by its competitors, as a result of the training and resources it had invested in him. It argued that it was unfair to allow such an employee, who had signed a restraint when accepting employment, to go over to a competitor who would reap the benefits of this investment.

The Appeal Court noted that restraints of trade are enforceable unless they are proven to be unreasonable. Their reasonableness is determined by balancing the need for parties to comply with their contractual promises and the right to freely exercise one’s trade or occupation. A restraint would only be reasonable if it protected an interest worthy of protection, such as confidential information and trade secrets, or customer and trade connections. For information to be confidential it had to be useful, restricted to a small number of people, and have economic value to the employer. Customer or trade connections could be protectable if they were of such a nature that the employee could induce such connections to follow him or her to a new employer. An interest in preventing competition was not in itself protectable.

The employer’s protectable interest had to outweigh the employee’s interest in being economically productive. It stated that an employee cannot be restrained from taking away and using his or her skills, experience and knowledge, even if these were acquired chiefly through the employer’s training of the employee. These skills were not the property of the employer.

The Appeal Court found that DJ had been a relatively junior employee and had lacked access to truly confidential information. The forms he used for his work were freely available on the internet. He had no access to sensitive financial information or business strategies.  DJ’s evidence was that he only handled the simplest of tasks for clients and that he had no ongoing relationships with any clients such that they felt an attachment to him. He had no role in recruiting clients at either organisation.

As no protectable interest had been proven, the Appeal Court noted that it was unnecessary to weigh up the interests of the parties. DJ was entitled to pursue his career unfettered by the clear language of the restraint he had concluded with the consultancy.

Restraints of trade remain contested territory, with the enforceability of restraints coming down to the circumstances of individual cases. In general, they are of most use in the case of absolutely key personnel only, and should not be concluded with employees simply to fetter their career path and keep them from joining the competition.

NAME AND SHAME

Social media is vastly accessible. A post typed out on one’s phone in a moment can be immediately available to countless users around the globe. When one has been bitten by a bad business practice, it can be temptingly satisfying and even feel like the selfless discharge of a moral duty, to tap out and share a NAME AND SHAME post. The perpetrator will feel your rage and lose business, perhaps even contact you to make things right, and others will be saved from falling into the same position you find yourself in.

But is it a good idea? Specifically, is it safe from a legal point of view to mouth off online?

In a recent judgment, the High Court was called upon to decide the bounds of free speech when a nasty business encounter is publicised on social media.

Mr JE was an unhappy man. He had bought an expensive car part from company AMT. There was a dispute as to whether or not the part was supplied damaged. Either way, JE found himself out of R15 000,00 and with no usable part. Phone calls to the business became acrimonious and did not resolve the matter. JE turned to the popular consumer website Hello Peter and reportacrime.co.za and posted complaints about his experience, in emphatic terms.

Company F, mentioned in the complaints and run by family members of the people behind AMT (since liquidated), took exception to the unfavourable publicity and sued JE to remove the complaints and desist from publishing any untrue allegations on the internet or in print media.

The court noted that, as in any defamation case, the company had to prove that there had been a publication by JE of defamatory material infringing its good name or reputation. Even true statements could be defamatory. Wrongfulness and intention on the part of JE were then presumed unless he could establish a defence allowing him to escape liability.

It was common cause that JE had intentionally published the complaints about the company, but it was disputed whether the posts were defamatory, wrongful or justified.  JE claimed that he was exercising his right to free speech and that the statements were true and published in the public interest.

To determine wrongfulness and defamatory content, the court indicated that the ordinary meaning and any innuendo in the statements had to be established. Then, one had to consider whether these damaged the company’s reputation, in the opinion of a reasonable person. If the statements were wrongful and defamatory, then JE had to prove a justification in law for publishing them.

Fair comment would be acceptable if it was expressed as comment on true facts, was fair, was not prompted by spite or malice, and was in the public interest.

In this case, the complaints contained statements based not on reliably proven facts but on allegations passed on to JE from third parties.

Proof of substantial truth would ordinarily be sufficient, however as JE alleged fraud, dishonesty or criminal conduct on the part of the company, every aspect of his allegations had to be true. The posts complained of were in fact not strictly true. JE had extrapolated from his experience to warn all and sundry that company F was the same as AMT (it was not) and that the company would deliver defective goods and fail to refund customers as a general rule.

The publication was not fair as the company had had no opportunity to comment before publication was made.

The court found that JE did publish out of spite and malice, as he had had no dealings with company F but was angered that AMT had not refunded him.

The court noted that a defamatory publication which was untrue or only partly true, could never be in the public interest. The court mentioned that members of the media, who are bound by codes of conduct, enjoy special protections against defamation claims, in that they can be excused for publishing false defamatory statements if it was reasonable to do so. Private citizens do not have this right.

The court found that the publications were defamatory and that they were neither fair comment nor truth in the public interest. JE had unleashed falsehoods and half-truths into social media with “unlimited global reach” and had overstepped the bounds of his constitutional right of free speech.

In the premises, JE was ordered to remove his complaints, desist from publishing further untrue statements, and pay both parties’ legal costs.

This case should serve as a cautionary tale for all social media users. As satisfying as it is to unleash a torrent of complaint at a company with whom one has had a below par experience, the consequences can be serious.One should think twice and three times before posting angry words on a global platform.

The court mentioned that liability for defamation can attach not only to the original poster but also to any person who repeats, confirms or draws attention to it. The fact that the defamatory comment was already in the public domain was no defence. Thus one should also think carefully before hitting the “share” button.

 

Exiting the exit agreement: a departing employee’s claims of coercion and duress

It happens with some regularity that an employee refers a dismissal dispute to the CCMA, and the employer arrives at the hearing bearing a termination agreement with the employee’s signature. In it, the employee agrees to resign from employment, often in return for some benefit such as an extra month or two’s pay, or the privilege of leaving honourably rather than being dismissed and incurring a disciplinary record for serious misconduct. The employee will usually concede that they signed the agreement, but argue that they were bullied into it. The CCMA commissioner will advise them that the agreement is binding until set aside by the Labour Court on solid grounds, such as duress, and close their file.

In the recent matter of Gbenga-Oluwatoye versus Reckitt Benckiser SA, an employee went as far as approaching the Labour Court and, thereafter, the Labour Appeal Court, in his quest to get out of a termination agreement he admitted signing with the employer.

The employee was approached by a headhunter while employed in a lucrative position with a large multinational. He later left his lucrative position, but actively concealed this from the headhunter, negotiating a generous sign-on bonus on the false basis that he was losing a handsome shareholding by leaving the large multinational to join the employer. In short, he deceived and defrauded the new employer.

Some months into his employment with the new employer, the employee’s misconduct came to light. He was suspended pending a disciplinary hearing,  and then summarily dismissed. On receipt of his termination letter, the employee approached the employer requesting a “softer exit”. He offered to repay the money over time, in exchange for the employer delaying action to revoke his work permit and housing allowance. The employer agreed, and the employer expressed his gratitude for the humanity shown him.

A termination agreement was then drawn up in draft form. The employee was unwilling to sign the first draft, but agreed to sign a second draft. The agreement recorded that it was in full and final settlement of any claims between the parties, and that it was entered into voluntarily without any coercion or pressure. The employee agreed, in the agreement, that he waived any right to approach the CCMA and Labour Court arising in any way from his employment and the termination agreement.

A week later, however, the employee brought an urgent application to the Labour Court, for an order setting aside the termination agreement and reinstating him into his employment. He argued that the agreement was against public policy and that he had been coerced into signing it through fear of losing his work permit and housing and other allowances.

The Labour Court was unsympathetic. It had regard to the fact that the employer had a legal entitlement to dismiss the employee summarily on account of his serious misconduct, and also the fact that the agreement had been further negotiated after the employee had been dissatisfied with the first draft. There were no facts to indicate that he signed the agreement only as a result of duress by the employer.

The employee was unrelenting, and took the matter further to the Labour Appeal Court, on appeal.

The Labour Appeal Court pointed out that, in order to get out of an agreement on the basis of duress, intimidation or improper pressure had to be proven of such magnitude that the purported consent of the signatory was no true consent. There had to be actual violence or a fear caused by the threat of a considerable evil. The threat had to be unlawful or against the morals of the community.

Although the Court did not point this out, it goes without saying that the loss of a work permit and of allowances due to termination of employment by resignation or by summary dismissal for gross misconduct, are lawful and reasonable consequences. They cannot be construed to be unlawful or against the morals of the community.

The Court did point out that, while everyone has the constitutional right to seek redress through the courts, this right could be limited in reasonable circumstances. Parties were free to limit this right in their free contractual dealings. The Court found that the employee was an experienced, senior managerial employee, who would understand the import of what he was agreeing to. Clauses limiting the right of redress were standard in termination agreements, and of practical value.

Finally, the Court point out that it had no power to set aside agreements simply because they appeared to be unfair.

The Court accordingly upheld the termination agreement, and dismissed the employee’s application with costs.

Caveat subscriptor – “signer, beware!” – is a well-worn legal maxim for good reason. All parties should be slow to sign any agreement unless they are completely satisfied with the terms, and should be aware that by signing an agreement they trigger important legal consequences which cannot be easily evaded. In the absence of compelling evidence of significant unlawful pressure, a party who foolishly signs an unfair or prejudicial agreement, will be held to its terms.

 

 

 

A paper shield? The email and social media disclaimer

“On this date, in response to the new guidelines of Facebook, pursuant to articles L.111, 112 and 113 of the code of intellectual property, I declare that my rights are attached to all my personal data drawings, paintings, photos, video, texts etc. published on my profile and my page. For commercial use of the foregoing my written consent is required at all times. The content of my profile contains private information. The violation of my privacy is punishable by law (UCC 1-308 1-308 1-103 and the Rome Statute)…”

What a feeling of empowerment, that small post on social media that instantly and indefinitely protects your rights from the predatory acts of big corporations! Except that it doesn’t. As pointed out by legendary internet myth-buster snopes.com, “Before you can use Facebook, you must indicate your acceptance of that social network’s legal terms, which includes its privacy policy and its terms and policies. You can neither alter your acceptance of that agreement nor restrict the rights of entities who are not parties to that agreement simply by posting a notice to your Facebook account.”

It is not only social media users who issue unilateral disclaimers, however. Receive an email from a large company or law firm, and in many cases the final words will be along the lines of “The information contained in this transmission is confidential and is intended solely for the nominated addressee. The information is private in nature and is subject to legal privilege. If you are not the intended recipient, you may not peruse, use or disseminate this transmission or any file attached thereto. Such actions are prohibited and may be unlawful. If you have received this transmission in error, please notify us immediately and delete same and all copies from your system.” Heavy stuff, but how enforceable is it, really?

In her recent feature in the attorneys’ journal, De Rebus (available in full at http://www.derebus.org.za/reading-the-small-print-are-e-mail-disclaimers-really-important), local attorney Jesicca Rajpal cited a US domestic violence case in which a man emailed his estranged wife, amongst other things, that “pay-back is really a b****… you and your others still have a gigantic debt to pay to me, which will be paid no matter what. I spend every second of every day contemplating an appropriate method of payment… Your most determined, unstoppable, and visceral enemy”. The email ended with a disclaimer: “Not one word herein should be construed by anyone as meaning violent or threatening intentions, and instead the entire contents is to be taken by the strict literary meaning. There have not been, and will be any elucidated threats of violence or intent, either expressed or implied, within the entirety of this document.”

The above disclaimer seems ludicrous and did not eventually protect the sender from the censure of the courts. But is it any more or less meaningful than any of the fancier disclaimers added to commercial and legal emails every day, with the intention of protecting parties’ critical legal and financial information?

Rajpal points out the weaknesses of the disclaimers so many of us use without a thought:

  1. We use them indiscriminately – not only when their use is appropriate but also when clearly non-confidential and trivial communications are sent.
  2. The disclaimer can be completely contradicted by the content of the email itself.
  3. There is no guarantee that the recipient will see or read the disclaimer.
  4. The disclaimer is usually only read after the confidential information, if at all.
  5. The sender cannot control the recipient’s response to the disclaimer.
  6. Most importantly, the disclaimer is issued unilaterally, without the recipient’s agreement to its terms. You cannot unilaterally impose obligations on another person. A disclaimer is not a contract and does not have the effect of binding another person without their consent.

Rajpal concludes her article with advice gleaned from the Minnesota Law Review. Do not place confidentiality disclaimers at the foot of your email – by the time a recipient sees it (if at all) they will have read the confidential information. Place them at the top of your email, if you must. If a communication is privileged, this can be marked in the subject line to bring it to the attention of a recipient even before they click on a message and see its content. For further protection, confidential information can be placed in an attachment and the email body can consist only of a disclaimer.

Even if the above advice is heeded, however, the sender cannot prevent an unintended recipient from ignoring the warnings in the subject line and email body, and accessing information the sender had hoped to keep confidential, without there being some sort of encryption in place. Mere disclaimers rely upon the attentiveness, goodwill and co-operation of an unintended recipient. Where confidentiality is critical, password protection is a better option, although also not fail-safe.

 

The end of the affair – evicting a live-in partner

The Western Cape High Court was recently called upon to consider the rights of a partner in a cohabitation relationship, after such relationship ended.

The plaintiff in the case was a married German national, Mr Hasse. He had, in addition to his marriage, been in a romantic relationship with the defendant, Ms Steyn, since 2005. Mr Hasse spent most of each year in Germany but visited South Africa annually for four months. He owned a property in Cape Town in which Ms Steyn resided with his permission on a rent-free basis as of 2007. During his visits to South Africa, the couple resided there together. Ms Steyn paid the expenses associated with the property using funds sent to her by Mr Hasse. Mr Hasse also paid for her day-to-day personal expenses.

The relationship ended in 2010. In early 2011, Mr Hasse informed Ms Steyn that he required her to move out of the property. She refused to vacate the property, and Mr Hasse instituted eviction proceedings against her.

In the course of the proceedings, Mr Hasse claimed that he had entered into a sort of lease agreement with Ms Steyn, and that she had breached the agreement by failing to properly manage the property and the funds provided to her for this purpose. He further alleged that her right of residence arose solely from his consent, which he had withdrawn, and that he had validly given her notice to vacate.

Ms Steyn on the other hand alleged that Mr Hasse had guaranteed her a residence for at least ten years, and had promised to buy her a townhouse if their relationship ended.

Both parties claimed to be under financial stress, and to desperately require either the sale of the property or continued residence therein, respectively.

The magistrate hearing the matter granted an eviction order. The court found that there was no lease agreement but that the right of residence arose only from Mr Hasse’s consent. He had withdrawn his consent as he was entitled to do, and properly followed the procedures to secure an eviction. Ms Steyn did not face the prospect of being left homeless if evicted. It was just and equitable that she vacate Mr Hasse’s property.

Ms Steyn appealed against the eviction order, to the High Court. Before the proceedings, she took the position in correspondence that she and Mr Hasse had entered into a universal partnership, and that he therefore legally owed her a duty of financial support. Before the court, however, she implicitly conceded that there was no universal partnership between her and Mr Hasse. The High Court noted that mere cohabitation does not give rise to any legal duty of support. However there was nothing to stop cohabiting partners from entering into an agreement creating such a duty.

In the present case, the evidence did not support any finding that Mr Hasse was obliged to maintain Ms Steyn. The court found that her allegations that she was promised accommodation for ten years and/or a townhouse were not credible. On her own version, she and Mr Hasse did not discuss finances or the future. The alleged agreement was raised late in the proceedings and was improbable.

Having disposed of Ms Steyn’s allegations as to Mr Hasse’s duties to her, the court considered what was equitable.

Ms Steyn had supported herself before her relationship with Mr Hasse and had done so since he withdrew his support. She also had two adult children who were legally obliged to support her if needed. She would not be rendered homeless if evicted.

Ms Steyn claimed before the court to be suffering from debilitating motor neuron disease since 2006, however this was the first time she had mentioned such an illness, and she supplied no evidence in support of such a diagnosis having been made. The court therefore did not take the alleged illness into account.

There was no basis on which Ms Steyn’s eviction would be unjust or inequitable.

The appeal against the eviction order was dismissed, and the High Court confirmed that Ms Steyn was obliged to vacate Mr Hasse’s property.

A R10 million oversight – the consequences of inadequate disclosure to an insurer

In the recently decided Supreme Court of Appeal case of Regent Insurance Company versus King’s Property Development, the court considered what was a material non-disclosure which would entitle an insurer to reject a claim on insurance.

In the case, King’s Property, the owner of a commercial building, insured the building against fire and other possible losses. Regent Insurance provided the insurance cover. The building burnt to the ground in 2010, and King’s duly lodged an insurance claim for approximately R10 million. Regent rejected the claim.

Regent stated that the building was let by King’s to a business which manufactured trailers using fibreglass and resin, both highly flammable materials. It had not been informed of this fact, and would not have agreed to insure the building had it been so informed. It alleged that it was not liable under the insurance policy as King’s had committed a material non-disclosure.

The fire had indeed arisen from a manufacturing process within the building, done by the tenant’s staff.

King’s approached the High Court for an order compelling Regent to pay out. The High Court was sympathetic. It noted that, when King’s took out the insurance policy, its broker had requested that Regent do an urgent survey of the property, which Regent apparently agreed to do but did not do. King’s was unaware that the survey was not done, and paid the premiums in the belief that the building was properly covered by the insurance policy. Under the doctrine of estoppel, so the High Court held, the insurer could not now reject the claim, as it had misled the insured into believing that the premises had been surveyed and the insurance was valid. The High Court ordered the insurer to pay out the R10 million.

Regent took the matter on appeal to the Supreme Court of Appeal, relying pertinently upon the non-disclosure by King’s that the premises were let to a business manufacturing goods with fibreglass and resin. King’s had disclosed that the property consisted of a warehouse and offices and, so they argued, the insurer should have realised that a warehouse could involve manufacture utilising flammable goods. By failing to undertake a survey as agreed, King’s argued, it was Regent’s own fault that it did not establish the extent of the risk, and by nevertheless accepting premiums in those circumstances, they waived the right to rely upon non-disclosure of the risk and were estopped from now doing so.

The SCA noted that King’s had at no time informed Regent that its tenant manufactured using flammable materials on the site. The presence of this tenant had a substantial impact on the risk to the insurer. The court reasoned that the reasonable person would have found this fact to be material and thus would have disclosed it to the insurer. The agreement that the insurer would undertake its own survey did not relieve King’s of the duty to disclose. Regent was able to show the court that its standard operating policies would have led to insurance being declined had it been aware that the building’s use fell into a high fire risk category. Thus the non-disclosure had induced it to enter into an agreement which it would otherwise have declined. The proven fact that another insurer had been satisfied with the management of fire risk at the property and had earlier extended insurance cover, did not detract from this.

With regard to estoppel, the SCA found that the prejudice to King’s had arisen from its own non-disclosure of the extent of the fire risk – and not from Regent’s failure to survey the premises as agreed.

The SCA accordingly reversed the ruling that the claim of R10 million be paid out, instead confirming that the claim was rightly rejected.

This case highlights the importance of ensuring that all material facts are disclosed to an insurer when insurance cover is sought.

In addition to disclosing particulars of the uses of tenanted commercial premises, it is wise for commercial landlords to include provisions in their leases with commercial tenants, directed at preventing any actions or omissions by the tenant which might affect the landlord’s insurance cover.

Key changes to the labour laws in 2015 – part 1: EASIER ENFORCEMENT OF CCMA AWARDS

The long-awaited Labour Relations Amendment Act came into effect, in large part, on 1 January 2015. It brought about a number of changes in both individual and collective labour law. In this series, we consider the key changes affecting individual labour law, and of which employees and employers alike should take note.

Prior to 2002, an employee who succeeded at the CCMA but whose employer ignored the CCMA’s award, had a steep hill to climb to get satisfaction. The employee would need to approach the Labour Court and have the award made an order of court, before having a writ of execution issued and handed to the sheriff of the court. This involved a full application to court supported by an affidavit, to be served under the rules of court, and awaiting and responding to any notice of opposition and answering affidavit from the employer. The employee would need to appear before a judge to secure an order against the employer. It was a complex and intimidating process for a layperson, time-consuming, and could increase costs drastically.

In 2002, the law was changed in order to assist employees in enforcing awards. Instead of approaching the Labour Court with a full application on notice and on affidavit, the employee returned to the CCMA to have the award certified. Once the award was certified, the employee went to the Labour Court to have a writ of execution against the employer issued over the counter. This was handed to the sheriff of the court for enforcement. This was a much simpler, cheaper, quicker process. However many employees still found the process, in particular dealing with two institutions, confusing and frustrating.

As of 2015, the process for enforcement is even more streamlined. Our law now states that an arbitration award may be enforced as if it were an order of the Labour Court in respect of which a writ has been issued. An employee battling with a recalcitrant employer must still have the award certified at the CCMA as previously, but then can take her certified award directly to the sheriff of the court for execution. There is no longer any need to involve the Labour Court, provided the award requires the employer to pay over money (as opposed to doing something – such as taking the employee back into employment. Where the award requires the employer to do something, other than pay over money, contempt proceedings in the Labour Court remain appropriate.)

The new law only applies prospectively, to arbitration awards issued after 1 January 2015.

The tariffs and procedures for enforcement and execution will be those that apply in the magistrates courts, which seems appropriate given that in almost all cases the amounts of money involved in awards will fall within the monetary jurisdiction of the magistrates courts (R300 000,00 or less).