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REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

 

(1)         REPORTABLE:  NO

(2)         OF INTEREST TO OTHER JUDGES: NO

(3)         REVISED

CASE NO: 21886/20

24/7/2020

 

In the matter between:

 

DDL SECURITY SERVICES (PTY) LTD                                                    Applicant

t/a 24 SECURITY SERVICES

                                   

And

 

WESLEY WYMAN                                                                                       First Respondent

 

REMOTE MONITORING CC                                                                    Second Respondent

 

REMOTE OFF-SITE MONITORING (PTY) LTD                                   Intervening Respondent

 

This judgment was handed down electronically by circulation to the parties’ representatives by email, and release to SAFLII. The date and time for hand-down is deemed to be 10h00 on 27 July 2020.

 

JUDGMENT

RANCHOD, J

 

[1]        This is an application for an interdict against the first and second respondents in the following terms as set out in the Notice of Motion.

 

1.1         ‘That first respondent be interdicted and restrained from

 approaching any of applicant’s clients to solicit business from such client or client or to provide services to such client for remote offsite monitoring of cameras, close circuit television equipment or related monitoring equipment of any electronic nature whatsoever that is designed or intended to monitor any premise (business, residential, commercial, industrial) to collect and analyse information relating to the movement of persons or materials into and from premises, or what is used as a crime prevention tool;

 

1.2         That first respondent be interdicted and restrained from utilising

applicant’s confidential information in the furthering of first respondent’s own business interest whether for him personally or through any legal entity of which he has a direct or indirect interest as employee, consultant and/or owner;

 

1.3         That second respondent be interdicted and restrained from

 utilising and or benefiting from any information provided by the first respondent to the second respondent in order that the first respondent may carry out electronic surveillance where such surveillance utilises applicant’s confidential information and/or such services is provided to applicant’s clients;

 

1.4         That second respondent be ordered to remove and destroy any

 confidential information in hard or electronic form from the possession and control of the second respondent;

 

1.5         That the respondents jointly and severally pay the cost of this

application on the scale as between attorney and client.’

 

[2]        There was an application for joinder by Remote Off-Site Monitoring (Pty) Ltd (ROM) which was not opposed by the applicant. The applicant for joinder stated that it ought to have been cited as second respondent and not Remote Monitoring CC which had been deregistered sometime in 2015. For all intents and purposes, as confirmed by the deponent to the answering affidavit, ROM is the party against whom the allegations made against second respondent apply with the necessary changes as determined by the context. The application was granted and ROM was admitted as third respondent.

 

[3]        In effect, second respondent is not before court. Where I refer to the first and third respondents jointly, I will refer to them as the respondents. The first respondent’s father, Mr Roy Wyman also features in this matter. He is the deponent to the answering affidavit in this matter. For the sake of convenience I will refer to them as Wesley and Roy respectively.

 

[4]        The matter lay before me in the urgent court. The respondents vehemently opposed urgency but after hearing the parties I deemed it to be urgent and ruled accordingly.

 

[5]        The applicant raised a point in limine in its replying affidavit that the answering affidavit had not been commissioned before a commissioner of oaths and therefore did not serve as such. However, it appeared that the last page of the affidavit had been separated and filed elsewhere in the bundle of papers on Caselines.

 

[6]        The respondents also raised a similar point in limine about the applicant’s replying affidavit. Again, it was found that the affidavit was in fact commissioned properly but the relevant pages had been misfiled.

 

[7]        Both points in limine were accordingly dismissed.

 

[8]        A further point in limine raised by the respondents was that the application should have been made in the Gauteng Local Division in Johannesburg as all the parties are within its jurisdiction. Applicant’s counsel submitted that there was no bar to the applicant having proceeded in the Gauteng Division, Pretoria as it has concurrent jurisdiction. Respondent referred to the matter of Nedbank v Thobejane & Related Matters [2018] 4 All SA 694 (GP). However, that matter was dealt with in the context of foreclosure matters where distressed consumers had defaulted on their mortgage bond payments and the banks instituted action in the Gauteng Division where the defendants resided within the jurisdiction of the Local Division. Thobejane also dealt with the issue of matters that were within the jurisdiction of the Magistrate’s Court but were sued out of the High Court. A Full Court determined the Thobejane matter. It is clear from the judgment and order that a judge presiding in the Provincial Division retains a discretion to hear a matter even though the Local Division has jurisdiction.

 

[9]        I ruled that on the facts of this matter before me there was no prejudice to the respondents and the matter could proceed accordingly. I turn then to the merits of the application.

 

The Parties

[10]      The applicant is a registered security service provider. The deponent to the founding affidavit says applicant is registered as such with the Private Security Industry Regulatory Authority (PSIRA) and renders its services from premises in Wynberg, Gauteng. It also operates in the Western Cape and Kwa-Zulu Natal. It provides, inter alia, electronic and remote monitoring services. He states further that it has been in the forefront in the movement towards electronic gathering and monitoring of information to prevent and mitigate crime. It monitors clients’ premises by way of closed-circuit televisions (CCTVs), television cameras and the use of technology and support of such monitoring. The applicant also uses analytical tools in the form of computer programs to analyse data and provides such information to its clients to mitigate the occurrence and the effects of crime.

 

[11]      It is common cause that Wesley had entered into a contract of employment with the applicant (annexure ‘C’ to the founding affidavit). It is also common cause that he was employed by the applicant as a CCTV specialist. He was employed by the applicant from 1 April 2019 until the end of February 2020 when he resigned on prior notice to the applicant.

 

[12]      The applicant says Wesley was employed in an extremely specialised position. He would install, program, maintain and upgrade the applicant’s remote monitoring devices. As such, he had access to all the requirements of the applicant’s clients, the contact details of the responsible persons, the costs structure as well as secret log-on codes and all other relevant secret and secure details of the equipment installed and specifically calibrated for each site.       

 

The issues

[13]      There appear to be two issues in dispute. First, whether Wesley breached the terms of his employment contract relating to the confidentiality of information he acquired during the time of his employment with the applicant. Second, whether he is engaged in unlawful competition with the applicant after having left his employment with it.

 

Confidential information

[14]      Paragraph 11 of Wesley’s contract of employment with the applicant provides as follows:

 

            ’11.      CONFIDENTIALITY

Except in the proper performance of his/her duties, the Employee will not either during his/her employment or at any time afterwards, either himself/herself utilise and/or directly/indirectly divulge and/or disclose to any third party, any information of a confidential nature concerning the business or persons having dealings with the Company or any of its associated companies, that was obtained directly or indirectly during the course of or in connection with his/her employment or holding any office with the Company or any of its associated companies’

 

[15]      Wesley does not deny the validity of the contract nor does he deny that he is bound by it.

 

[16]      Mr Snyman SC, for the applicant submits that Wesley is in any event bound by an implied term in each contract of employment that an employee may not during his employment and after he or she has left, divulge any confidential information of the erstwhile employer. Also, that a competitor in the market may not, if confidential information of another competitor becomes available to him, utilise it to compete with the owner thereof. I was referred to Alum-Phos (Pty) Ltd v Spatz & Another [1997] 1 All SA 616 (W) at 623B where Southwood J stated:

 

‘It is an implied term of every contract of service that an employee will not use confidential information acquired during his period of service for his own benefit or to the detriment of his employer and such term binds the employee even after he has left the service of the employer. This term applies to all confidential information whether acquired honestly or dishonestly…

 

Irrespective of whether the applicant seeks to enforce an implied term or an express term in an agreement the applicant must establish that there is in fact confidential information to be protected’

 

[17]      The question then is whether the applicant has shown that there is in fact confidential information to be protected. The applicant says its confidential information relates to, inter alia, pricing, costs structure marketing strategy, unique services rendered as well as contact details of its clients and their requirements as well as details of its suppliers. The confidential information also includes log-on codes as well as secret and secure details of the equipment installed and calibrated at its clients’ premises.

 

[18]      The applicant says it does not seek to restrain Wesley from using his skills but rather, from utilising its confidential information in doing so.

 

[19]      Wesley did not personally answer to the allegations made against him in the founding affidavit. The answering affidavit is by Mr Roy Arthur Wyman, Wesley’s father and sole director of ROM (the third respondent who had applied to be joined in these proceedings.) Instead, Wesley filed a confirmatory affidavit and says he had authorised his father to depose to an opposing affidavit on his behalf. He says his reason for doing so is that his father is an expert in the field of off-site monitoring whereas he has been in the industry for only about eight years. It is in my view a rather peculiar explanation or reason for not himself answering to allegations specifically levelled against him but indirectly through his father.

 

[20]      The difficulty I have with this approach is that Roy Wyman (and his company ROM) have entered the fray on the basis that the applicant is, in effect, seeking to interdict him and his company. The applicant’s case must be determined on the basis of its founding affidavit and the relief it seeks. Third respondent says it accepts that the allegations made by the applicant against second respondent in fact applies to itself and responds to them accordingly.

 

[21]      The applicant alleges that Wesley attended at some of its clients’ premises after leaving its employment and changed the settings on its clients’ systems by unlawfully accessing them using confidential passwords and information.

 

[22]      The applicant says on 3 March 2020 its cameras recorded Wesley entering the premises of Holler Trade which is its client. He is seen to be with Holler Trade’s representative. Applicant says Wesley remotely accessed the camera systems and moved the electronic trip wires around to create exercise (sic) and unnecessary alarm activations and delayed responses to the alarm activations. The large number of activations logged down applicant’s system. The applicant’s system showed that it was Wesley who had accessed the camera systems. He had accessed the main decoder on site that is linked to all the cameras and also unlawfully accessed Holler Trade’s network and used the password that he had knowledge of to sign into the system and he physically changed the trip wires programming.

 

[23]      Applicant states further that the effect of such a change is quite simply that it irritates a client who experiences excessive alarm activations and, it costs the applicant a great deal of resources and accordingly money, to respond to multiple activations. It also causes its client to doubt the effectiveness of the applicant’s systems.

 

[24]      Wesley, through Roy, confirms that use of a company’s confidential information ‘would obviously be unlawful.’[1]

 

[25]      However, Wesley denies going to Holler Trade unlawfully. He says he was literally begged by one Allan Copin of Holler Trade to come and fix the cameras that had been down since Friday the previous week. From an exchange of WhatsApp messages between them the following are relevant:

 

            ‘Allan @

Holler Trade:               “Hi Wesley, our cameras’ have been down since Friday last week. We urgently need your help to get them back up. Are you available to come through this morning to Holler Trade?”

1^st Respondent:           “Good day sir

I would love to help, but unfortunately I do not work for 24/7 no more.”

Allan:                           “Things change quickly over there”;

1^st Respondent:           “Can I give you a call at 08:00?”

Allan:                           “Ja thanks”

“Hi Wesley, 24/7 said they were sending some here between 09:00 and 09:30. Can you hold on coming here until then? If this oke doesn’t rock up I’ll let you know”

1^st Respondent:           “No problem sir keep me updated I am booked from 11 till 4 today”

Allan:                           “Cool”

“Hi Wesley, this guy from 24/7 is struggling. Are you free after 16:00?”.

1^st Respondent:           “What time do you leave today. Who did they send?”

Allan:                           “We can be here till its’ fixed. The guys name is Musa”

Then:

Allan:                           “Ok, will keep you updated if by some miracle they come right here”.’

 

[26]      It is apparent from this exchange of messages that at first Wesley informs Allan that he is no longer employed at 24/7 (the Applicant) therefore he cannot help. But then, immediately thereafter, he asks Allan if he (Wesley) can call him ‘at 8:00’. Allan confirms that he may do so. It seems that the call was made and it was arranged that Wesley will go and see Allan. This is apparent from Allan’s message:

           

            ‘Can you hold on coming here….’

 

[27]      Wesley, by his own admission, went to Holler Trade and reset the system and also two cameras that were off and he also reset the trip wires on them.[2] He justifies this on the basis that it was because Holler Trade had made the request. This is inexplicable. He had informed Allan that he could not help because he was no longer employed by the applicant but then goes on to call him later and thereafter goes and resets the cameras and trip wires of a client of the applicant. He clearly solicited a client of the applicant and utilised passwords of the applicant to gain access to the system at Holler Trade. Furthermore, Mr De Lima (the deponent to the founding affidavit) questions the authority of Allan Coppin as he is a junior person at Holler Trade and he (De Lima) deals only with the owner of Holler Trade. Applicant’s contention is that Coppin did not have the requisite authority to engage with Wesley.

 

[28]      The applicant refers to a second incident which occurred on 6 March 2020 at the house of a CEO of a bank which is also guarded by it with the same technology. Applicant says Wesley connected remotely to the main decoder at about 3pm, unlawfully (because it is confidential) viewed the camera logs and caused the cameras to default to factory settings, rendering them ineffective. He also wiped clean the memory of the decoder using his username and password and disconnected the site from applicant’s control room. It necessitated having to reset the whole system.

 

[29]      Mr De Lima says he ‘assumes’ that Wesley accessed the codes remotely from outside the house of the CEO or via the internet (using the password) as applicant could not find any proof of him entering the premises.

 

[30]      Wesley, through Roy, vehemently denies these allegations. Whilst he says he could not have been outside the house of the CEO at about 3pm as he was at the CCMA offices at the Department of Labour, he does not explicitly deny having accessed the site through the internet.

 

[31]      Wesley, again through Roy, states that employees of the applicant did not have unique passwords for clients. He says there is a generic password used by installers and technicians, which could include a number of employees of the applicant.[3]  

 

[32]      The respondents have themselves attached annexure “ROM20” to the answering affidavit which clearly contradicts this assertion. “ROM20” includes an email dated 19 February 2020 from Wesley to applicant’s Smart Surveillance Manager, Frik Hanekom in which he states:

 

‘Please see attached handover as requested. Please note that the DDNS username and password is on the second tab of the spreadsheet this is very important because if it gets out anyone will have access to do as they want on your sites. As discussed I have not had any issues in the past as I was the only one with this password however recently I had one of the accounts being deleted so I am not sure who all has it now. My plan was to change this password when I get time.’

Applicant says only two of its employees (one of whom was Wesley) had the passwords.

 

[33]      What it shows, as I understand it, is that there was a unique password and username for the DDNS and at some stage only Wesley had access to it. Applicant says only two of its employees (one of whom was Wesley) had the password. The email also contains the URL link. It is noteworthy that Wesley retained a copy of this confidential email after leaving the applicant and after having done a ‘handover’ of the passwords to Frik Hanekom.

 

[34]      In my view, Wesley breached the confidentiality clause of the employment contract by unlawfully using his erstwhile employer’s confidential information.

 

[35]      I turn, then, to the issue of whether Wesley is engaged in unlawful competition with the applicant after having left its employ, as alleged by applicant.

 

[36]      Roy says Wesley works as a business broker, generating business for his (Roy’s) company until such time as Wesley is able to get his business off the ground.

 

[37]      The day before (28 February 2020) Wesley left the employ of the applicant, he was asked to sign an undertaking that he will not solicit or induce its clients in favour of himself. The relevant paragraph of the letter reads:

 

‘We as the Company are entitled to the protection of our proprietary information including the identity and details of clients with whom you have become familiar during your employment as well as company system passwords. We hereby request from you an undertaking that you accordingly not entitled to solicit and / or induce clients from the Company in favour of your own (or any third party) endeavours and will keep all information in your knowledge confidential. We request that you sign and return this letter to the company as indication of your assent to the requested undertaking.’

 

[38]      Wesley refused to sign it. His stance was that he had no obligation to give such an undertaking as he had not signed a restraint of trade agreement and, as long as he did not misuse any confidential information of the applicant, he could not be legally stopped from soliciting business, even if it is from an existing client of the applicant.

 

[39]      It is clear with regard to the Holler Trade incident that Wesley tried to solicit a client of the applicant after first having told Allan Copin that he cannot help him as he had left the employ of the applicant. He utilised confidential information of the applicant to reset its security system with a view to get Holler Trade to switch over to the third respondent.

 

[40]      As I said, Wesley is of the view that nothing prohibits him from sourcing work for ROM at existing clients of the applicant.[4]

 

[41]      The applicant says it is not seeking to stifle competition but only to limit the use of confidential information in doing so.

 

[42]      In the applicant’s heads of argument Mr Snyman SC relies on certain case authorities which deal with restraint of trade agreements. As I said, there is no restraint of trade agreement and I therefore do not see my way clear to granting an order preventing the respondents from soliciting business from the applicant’s clients as long as they do not use its confidential information to do so. In the circumstances it seems to me that an appropriate order would be to interdict the respondents from utilising confidential information of the applicant in soliciting business from applicant’s clients.

 

[43]      Both parties sought punitive costs orders against each other. I do not think that is warranted. The applicant has substantially succeeded hence a normal costs order in its favour should follow.

 

[44]      An order is granted as follows:

1.  The application for joinder by Remote Off-Site Monitoring (Pty) Ltd as third respondent is granted with no order as to costs;

2.    The first respondent be and is hereby interdicted and restrained from utilising applicant’s confidential information in the furthering of first respondent’s own business interest whether for him personally or through any legal entity of which he has a direct or indirect interest as employee, consultant or owner;

 

3.    The second respondent be and is hereby interdicted and restrained from utilising and or benefiting from any information provided by the first respondent to the second respondent in order that the first respondent may carry out electronic surveillance where such surveillance utilises applicant’s confidential information and/or such services is provided to applicant’s clients;

 

4.    The second respondent be and is hereby ordered to remove and destroy any confidential information in hard or electronic form from the possession and control of the second respondent;

 

5.    The first and third respondents are to pay the costs jointly and severally the one paying the other to be absolved.

 

 

 

RANCHOD, J

JUDGE OF THE HIGH COURT

 

 

 

Appearances:           

 

 

Appearance for applicant:                          Adv M Snyman SC

                                                                  Instructed by MJ Hood & Associates 

                                                                  Molon Labe House, Unit 10

                                                                  Woodview Office Park

                                                                  1 Humber Street

                                                                  Woodmead, Rivonia                                              

 

Appearance for first and intervening        Adv ZF Kriel             

respondents:                                              Instructed by Nols Nolte Inc

                                                                  195 Mirca Street

                                                                  Sinoville, Pretoria

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