Without Prejudice - latest Issue
Volume 16, Issue 7, 2016
Source: Without Prejudice 16, pp 1 –34 (2016)More Less
The International Monetary Fund (IMF) recently said the UK's decision to leave the European Union has "thrown a spanner in the works" of its global growth forecast. The IMF had already downgraded most countries in its forecast pre-Brexit; it is not expected to change its negative view of the outlook for the world economy. Maurice Obstfeld, the IMF's chief economist warned that the world economy was stalling, there is "low growth, deflationary equilibrium". He said that while global growth continues, it is at "an increasingly disappointing pace that leaves the economy more exposed to negative risks". And he added, "Growth has been too slow for too long." So, it is anticipated that the Brexit vote in the UK is likely to be costly, not only for the UK and the EU but also for the global economy. It has often been observed that economies do not thrive on uncertainty. As this is undoubtedly the ground on which business currently stands and the negative impact, as foreign countries and companies become increasingly risk averse, will be felt in South Africa. This year, between January and end June, 97 companies issued profit warnings. In 2015, during the same period, 88 companies issued profit warnings (numbers courtesy of sister publication, Deal Makers). And it is in this environment that it becomes increasingly necessary to try to save businesses and jobs. Business rescue, as an alternative to liquidation has been a welcome introduction - not only to the financially distressed company but also staff and creditors, financial institutions and, of course, shareholders. Business rescue is relatively new to South Africa; its aim - to put the company back on a sound footing - is admirable. However, the drafting of the new legislation has frequently been called complex and unclear and it brings with it uncertainty, conflicting views in interpretation and controversial judgements. I am very grateful to the writers of the articles in this feature, and in particular to Yaniv Kleitman who is always unfailingly patient, whose grasp of the topic enabled me to ask for articles on specific aspects I might otherwise have missed and who, despite a heavy schedule, always produces the article I request. The analysis and opinion of aspects of this area of law will, I am sure, be beneficial to readers both in and outside the law.
Source: Without Prejudice 16 (2016)More Less
This month's feature on Business Rescue is interesting and could prove particularly valuable to many people in this uncertain economic climate. I am always very grateful to the many practitioners who find time to write articles that will benefit others considerably. It is no mean feat for the attorneys, their support staff and my contacts to provide these articles. Work hours are long and full and there is seldom time left over for articles. I do recognise the encroachment into private time, without prejudice and the magazine's readers are ultimately the winners.
Author Zara KretzmerSource: Without Prejudice 16, pp 8 –9 (2016)More Less
The Gauteng High Court, in the recent case of Halstead-Cleak v Eskom Holdings Limited  JOL 33332 (GP), held that Eskom was "100% liable" to the Plaintiff who had been riding a bicycle and inadvertently came into contact with a low hanging live powerline spanning a footpath, sustaining serious burn injuries. While Eskom might ordinarily have been liable in these circumstances under the common law (on the basis of negligence), what was exceptional in this instance was that the court found that Eskom was strictly liable in terms of the Consumer Protection Act (pursuant to the provisions of Section 61 of the CPA).
Author Natalie HartenSource: Without Prejudice 16, pp 9 –12 (2016)More Less
Disability is often accompanied by unemployment, lower wages, poorer working conditions and barriers to promotion both in South Africa and abroad. Many employers tend to exclude and marginalise employees with disabilities, not merely because their disability impairs the employees' suitability for employment but also because the employer regards the disability as an abnormality or flaw. Sadly, these individuals are frequently refused employment or dismissed, rather than accommodated.
Author Amandinho Munhemeze CaulaSource: Without Prejudice 16, pp 12 –13 (2016)More Less
The discovery of natural resources, and the expected development of the country, have led to a number of national and foreign companies beginning to develop various businesses in Mozambique. The short-term employment framework appears to be the most flexible mechanism available to them because it allows the use of qualified, specialised staff in projects taking place around the country.
Source: Without Prejudice 16, pp 14 –16 (2016)More Less
On 31 January 2012, the Australian Personal Property Securities Act (Cth) 2009 (PPSA) came into force. The Act signified a monumental shift in security taking in Australia. All stakeholders (lenders, attorneys firms and borrowers) had to come to terms with new rules and procedures to effectively take security over personal property in Australia. Is it perhaps time that South Africa considered a similar shift in its security taking regime?
Author Jonathan Ripley-EvansSource: Without Prejudice 16 (2016)More Less
On 20 April, the Hague District Court (Netherlands) set aside an international arbitration award which originally granted a claim for damages totalling more than US$50bn (Yukos award) in favour of certain shareholders in the Yukos Oil Company, against the Russian Federation. The Hague District Court determined that, as Russia had not consented to the arbitral proceedings, the request for arbitration was invalid and it set aside the largest international arbitral award ever issued. The reasons for setting aside of the Yukos award are discussed in this article.
Author Patrick BracherSource: Without Prejudice 16, pp 18 –19 (2016)More Less
Prosecutor suspended for calling nightclubs cesspools
Supreme Court upholds affirmative action programme at university
Deferred-deportation programme prevented
Law schools need to teach more than law
Graduate complains of not having her disability accommodated at bar exam
Client drops firm after lawyer uses Twitter to celebrate a win involving disabled children
Court overturns $1 million sanction and criticises opposing counsel
General Counsel questions associate pay rise to $180 000
Accident driver sues city for distracting police siren and lights
Warrantless blood draws in DUI arrests are unconstitutional
Lawyers and client charged for sex tape of alleged harasser
Author Lipton NcubeSource: Without Prejudice 16 (2016)More Less
In the recent case of Palala Resources (Pty) Ltd (Palala) v Minister of Mineral Resources and Energy (the Minister) and Others (479/15)  ZASCA 80, the Supreme Court of Appeal (SCA) had to consider whether restoration of a previously deregistered company constituted a "Biblical Lazarus" in respect of a lapsed mining right.
Source: Without Prejudice 16, pp 26 –27 (2016)More Less
Part 1 - Liquidators' entitlement to investigate the strength of a potential claim has been put in the spotlight in the recent case of Roering NO v Mahlangu (581/2015)  ZASCA 79 (30 May 2016) per Wallis JA (Willis, Saldulker and Zondi JJA and Tsoka AJA concurring). The Supreme Court of Appeal (SCA) ruled that the legality of a summons issued by a commissioner pursuant to an enquiry in terms of s417 and s418 of the Companies Act (61 of 1973) would be determined by its purpose, and not its effect. The provisions of Chapter 14 of the old Act, which includes subsections 417 and 418, remain in force by virtue of Item 9(10) of Schedule 5 to the new Act, pending further enactment. The SCA found that a summons does not constitute an abuse of process merely because the issues canvassed in the examination may overlap with issues in pending or contemplated civil litigation.
Author Marilize JerlingSource: Without Prejudice 16, pp 28 –29 (2016)More Less
In light of the enhanced accountability provisions,and recent case law development in relation to directors' liability, non-executive directorships are being treated with more caution. Nominated directors are carefully weighing up the benefit and the risk in accepting any appointments. However, this is not always the case and companies may find themselves with directors who have "overboarded" and under-delivered.
Author Kalene De VosSource: Without Prejudice 16, pp 29 –30 (2016)More Less
Many South African companies are failing their stakeholders. This is apparent from the ever increasing instances of strikes, corporate failures and exposed managerial frauds and misconduct. With the country's growth forecast for 2016 at 0.9%, down from 1.7%, an unemployment rate of 25%, and a currency which has halved over the past five years, there is no doubt that we are entering uncertain times. The economic downturn will continue to reveal the cracks caused by irregular business practises and poor executive decision-making which, in most instances, leaves shareholders to pick up the tab.
Source: Without Prejudice 16 (2016)More Less
Author Aidan KennySource: Without Prejudice 16, pp 32 –34 (2016)More Less
The purchase of immovable property is more often funded by a mortgage bond granted by financial institutions, than cash. The security of the financial institution is the property being purchased and a mortgage bond is registered over the property. If the purchaser defaults by not paying monthly instalments, the financial institution has the right of recourse to sell the property to recover the funds borrowed.
Author Yogani ReddySource: Without Prejudice 16, pp 34 –35 (2016)More Less
The development of new pharmaceutical compounds is time consuming, complex and requires a considerable amount of money. These difficulties arise not only from needing a large team with several areas of expertise to discover compounds that can treat diseases but also for testing the discovered compounds to ascertain levels of safety in humans or animals and manufacturing them on a mass scale. In addition to these issues, sometimes new compounds do not provide sufficient improvements in the treatment of diseases when compared with known compounds, and therefore do not find a market. A cheaper, less risky option for companies is to optimise the use of, or find new uses for, known compounds. One way in which companies are able to do this is to find new dosage regimens.
Author Karen KitchenSource: Without Prejudice 16, pp 36 –37 (2016)More Less
Whilst it is difficult to obtain statutory trade mark protection for shape trade marks, it is not impossible. To determine whether a shape trade mark is registrable it is necessary to assess whether the proposed shape trade mark is inherently registrable; that is, is it distinctive or capable of distinguishing one's goods from those of third parties operating in a similar field of trade? The assessment also goes to the heart of what constitutes a trade mark, which is whether it functions as a badge of origin. A shape mark that was considered not to be sufficiently inherently distinctive to qualify for registration at the outset may acquire distinctiveness through use and, therefore, be capable of registration.