Last week in commercial law: d[eliver] as the Romans d[eliver], intercepted invoices, and who’s afraid of litigating in Liberia

Eswatini Oils needs to boil things. It buys two boilers, one big one small, from Vusi’s Farms. Seemingly while Eswatini Oils is busy dismantling the boilers, Vusi’s Farms sells the bigger boiler to Steam House Engineering. Steam House Engineering somehow manages to dismantle and remove the bigger boiler before Eswatini Oils gets to it. Eswatini Oils asks after the bigger boiler, now nowhere to be seen, but Vusi’s Farm argues that it cancelled the sale because Eswatini Oils took too long to dismantle and remove both boilers. Eswatini Oils, now really needing to boil things, goes to urgent court for, in effect, specific performance of the sale and a vindicatory order for the bigger boiler against Steam House Engineering [your summarist’s legal writing tip for the week is that “vindicatory order” or “vindicatory relief” will do just fine instead of “rei vindicatio”]. Gauteng Division, Johannesburg: Eswatini Oils acquired ownership of the boilers by traditio longa manu, which is what you say to conjure your patronus when faced with a dementor how the Romans delivered bulky things when the seller pointed out the thing and made it available to the buyer, which happened here when Vusi’s Farms let Eswatini Oils come on site dismantle the boilers (and so, as far as the bigger boiler goes, there was nothing for Vusi’s Farms to transfer to Steam House Engineering) [and a big gold star for readers who are now thinking about how the doctrine of notice works on these facts: it doesn’t apply if Eswatini Oils acquires ownership first (because its real right then trumps Steam House Engineering’s personal right); if Steam House Engineering acquires ownership before Eswatini Oils but Steam House Engineering knew or foresaw the possibility of Eswatini Oils’s prior personal right, then the doctrine of notice saves Eswatini Oils (and Eswatini Oils is entitled to an order setting aside the transfer to Steam House Engineering so that Vusi’s Farms can transfer ownership to Eswatini Oils—or, more controversially, an order that Steam House Engineering transfers the boiler directly to Eswatini Oils)] [your summarist also notes that English lawyers would probably ask why courts are getting involved with dismantling boilers: a boiler is a boiler so Eswatini Oils should have just bought other boilers from someone else and then sued Vusi’s Farms for damages—an outcome that would please the efficient-breach law and economics crowd, especially if Vusi’s Farm’s got a better deal from Steam House Engineering].

Mahek mills grain. It buys grain from Agrisa. Mahek sues Agrisa in arbitration, alleging Agrisa breached their contract. The dispute-resolution clause in their contract has a 28-day time bar for notifying the other party of claims. Agrisa argues that Mahek’s claim is prescribed because although Mahek notified it within the 28-day deadline, its claim notification did not adequately describe the claim. The arbitrator determines—and dismisses—the prescription argument as a separated issue [your summarist promises those are human em dashes, not AI flotsam]. Agrisa rushes off to urgent court, asking for a stay of the arbitration pending a review of the arbitrator’s decision on prescription (the arbitrator decided—as all good arbitrators should—to push ahead with the arbitration despite Agrisa’s grumblings about a review). Western Cape Division: Agrisa has reasonable prospects of success in the review and it will suffer irreparable harm if it is forced to arbitrate but its review later succeeds [your summarist is sceptical and fears that allowing these detours to court undermines the reason why parties agree to arbitrate in the first place; your summarist also doubts that Oudekraal and Kirland, whatever they now mean, apply to arbitrators].

While working as an internal auditor for Voltex, Riga discovers some shenanigans in the books. At some point, Riga reports what he finds to Voltex’s higher ups, who reward him with a well-earned demotion and, in June 2022, dismissal. In May 2023, Riga sues for wrongful dismissal. In February 2024, Riga abandons that claim and instead sues under the Protected Disclosures Act (Riga gets more money under the statutory claim than under the wrongful dismissal claim, which is usually limited to two weeks’ wages). Voltex argues that the new statutory claim is prescribed. Voltex’s prescription argument turns on whether the wrongful dismissal claim and the statutory claim are the same debt (if so, then service of the May 2023 summons is enough to interrupt prescription despite Riga’s later statutory pivot). Gauteng Division, Johannesburg: the wrongful dismissal claim and the statutory claim are the same debt because the facts are the same and, at bottom, they are both claims about Riga’s wrongful dismissal, so the statutory claim is not prescribed [your summarist doesn’t understand the timeline for the prescription argument; paragraph 6 of the judgment doesn’t make sense if Riga was dismissed in June 2022].

Numacon’s majority shareholders agree to buy a minority shareholder’s shares at fair value. They agree to a complicated valuation process that involves a valuer, then an arbitrator, and then an arbitration appeal. They also agree that the valuation is final and non-appealable. Western Cape Division: a court still has supervisory jurisdiction on narrow grounds of review, and one of those grounds is, like here, if the valuer exceeds his power.

Central Bridge has a shop in Dragon City Shopping Centre. Central Bridge relies on Dragon City’s IT system, email server, and accounts department, including to make payments for Central Bridge [your summarist is no titan of business but that seems like a sub-optimal idea]. Pinnacle Micro sends Central Bridge an invoice. Central Bridge forwards the invoice to Dragon City’s accounts department, who pays the invoice. But wait! It turns out that somone intercepted Pinnacle Micro’s email, changed the banking details on the invoice, and emailed the forged invoice to Dragon City’s accounts department, pretending to be from a Central Bridge email address. Central Bridge thinks it was Colonel Mustard in the Billard Room Intanium Technologies, who administers Dragon City’s IT and has access to its emails [another sub-optimal idea]. Central Bridge sues Intanium Technologies. Intanium Technologies excepts, arguing that any loss was sustained by Dragon City, not Central Bridge, and that the fraudulent invoice was a (mis)representation to Dragon City, not Central Bridge. Gauteng Division, Johannesburg: points for chutzpah but both arguments miss the point that Dragon City acted as Central Bridge’s agent, both when it received the fraudulent invoice and when it paid, so exception dismissed [your summarist thinks this might be too quick and we probably need some more facts, including facts about the scope of Dragon City’s authority and how the payment arrangement between it and Central Bridge worked, but it’s not obvious that there was a misrepresentation to Central Bridge if Central Bridge never received the fraudulent invoice, and if the payment to Intanium Technologies was fraudulent, isn’t the better (or more doctrinally sound) claim an enrichment claim against Intanium Technologies’ bank?].

And finally, some exciting jurisdiction news [your summarist apologises for the tautology: all jurisdiction news is exciting]. PSTV Energy, a Dubai company, supplied fuel to Conex Petroleum, a Liberian company, in Liberia. Conex Petroleum’s holding company, Conex Oil & Gas, a BVI company, gave PSTV Energy a guarantee. The guarantee is governed by English law and has a non-exclusive English choice of court agreement. Conex Petroleum does not pay for the fuel, so PSTV Energy sues Conex Oil & Gas on the guarantee in England. A week before PSTV Energy sues in England, Conex Oil & Gas sues in Liberia. Conex Oil & Gas would rather not litigate in England, so it applies for a stay of PSTV Energy’s claim on forum non conveniens grounds [which is a convenient time to note that, remarkably, it still seems to be an open question whether forum non conveniens exists in South African law]. Because the parties agreed to litigate in England, even if non-exclusively, Conex Oil & Gas must show strong reasons for a stay; factors that go to convenience, ordinarily the coin of the realm in a forum non conveniens analysis, that were foreseeable at the time of contracting are not relevant. Commercial Court: Monrovia may be lovely this time of year, but Conex Oil & Gas’s reasons for wanting to litigate in Liberia instead of England were all foreseeable when it agreed to litigate in England, so there are no strong reasons for a stay. 

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