- Outdoor Network Ltd and Another v Strawberry Worx Pop (Pty) Ltd and Another (9531/2014) [2015] ZAKZDHC 110.29 MB
[1] This is an application for an interdict. The facts giving rise to the application may be summarised as follows :
(a) the second respondent, the Passenger Rail Agency of South Africa (‘PRASA’) is the legal successor to the South African Commuter Corporation Ltd and holds all the assets and operations which that entity received originally from the South African Transport Services, together with Metrorail and others;
(b) PRASA accordingly became the owner of a number of immovable properties (‘the sites’) situated throughout the country including bus stations, railway stations, and areas of land adjacent to railway lines both in built-up and rural areas, where the sites are visible from railway lines and major roads and highways;
(c) in order to capitalise on the use of the sites PRASA and its predecessors leased them to various companies which used the sites for advertising purposes. The various companies would erect an advertising structure on the site leased to them, and flight different adverts for their clients on the advertising structure from time to time;
(d) on the 17th May 2002 the applicant, Outdoor Network Ltd (‘Outdoor Network’) concluded an agreement of lease in respect of a number of properties belonging to PRASA’s predecessor in title. In terms of those lease agreements Outdoor Network was entitled to erect advertising structures and flight adverts thereon from time to time in exchange for the payment of a monthly rental to PRASA. The advertising structures were built and maintained by Outdoor Network at its own expense. The lease agreements provided that, upon termination, Outdoor Network would remove the advertising flights and structures from the sites within seven days from such termination, failing which PRASA would be entitled to employ a contractor to remove those items and be reimbursed by Outdoor Network for the expense in doing so;
(e) The second applicant is Autumn Storm Investments 362 (Pty) Ltd (‘Autumn Storm’). Autumn Storm is a subsidiary of Outdoor Network and as their interests completely coincide in this application, where I refer to Outdoor Network Ltd, I intend it to be a reference to both Outdoor Network and Autumn Storm wherever necessary;
(f) the relationship between PRASA and Outdoor Network continued until 2010 when PRASA invited tenders to be submitted by advertising companies to allow them to advertise from all of its sites;
(g) Outdoor Network was unsuccessful in the tender process which was awarded to a third party. The existing lease agreements were terminated, and a dispute then arose between PRASA and Outdoor Network as to the removal of the advertising structures. I understand that this dispute is the subject of litigation before another court. It appears that as Outdoor Network did not initially remove the advertising structures, PRASA indicated that they would do so themselves. They removed two structures, but a dispute arose over this because Outdoor Network regarded the cost of them having done so, which PRASA sought to recover from Outdoor Network, as exorbitant. At a further stage PRASA indicated to Outdoor Network that as it had not continued to pay all the rentals due, PRASA would retain the advertising structures in the exercise of a lien over those structures for the unpaid rentals and/or holding-over damages;
(h) The first respondent in this application, Strawberry Worx Pop (Pty) Ltd (‘Strawberry Worx’) is a subsidiary of the successful tenderer for the PRASA sites. Outdoor Network then became aware that PRASA was allowing Strawberry Worx to advertise on the sites using the advertising structures of Outdoor Network;
(i) in its application papers, Outdoor Network put up an email addressed by Strawberry Worx to PRASA recording that it was unable to provide advertising structures because of a shortage of steel due to a strike by steel workers. The suggestion was then made that the advertising material would be flighted upon the advertising structures of Outdoor Network and an indemnity would be provided to both the client on whose behalf the advertising was put up and, presumably, PRASA. Part of the justification was that PRASA’s view was that those advertising structures had been abandoned by Outdoor Network. The affidavits in this application and the ongoing litigation make it clear that this is a claim strenuously denied by Outdoor Network;
(j) it is common cause that the advertising structures erected by Outdoor Network and which it claimed still belonged to it, are being used by Strawberry Worx with the acquiescence of PRASA for the purpose of flighting adverts of the clients of the successful tenderer;
(k) in its opposing affidavit, the respondents claimed that PRASA was entitled to allow these structures to be so used, even if they still belonged to Outdoor Network, because PRASA had a lien over the structures for unpaid rental and/or holding-over damages. Mr Kemp SC, who appeared for the respondents together with Mr Naidu, disavowed any reliance on that defence. In my view they were correct to do so, because a lien for unpaid rental (and, if one existed at all for holding over damages) would not have entitled PRASA to use the advertising structures of Outdoor Network.
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