Not reportable in the matter between

ad hoc work for the third respondent which did not in any way detract from their performance of their duties for the applicant. They performed duties for third respondent after working hours.
The disciplinary hearing against him took place on 12 April 2004 and he was dismissed. His dismissal was substantially and procedurally unfair and he intends to take further action.
He denies that he committed any unlawful act.
He is not aware of any pricing strategy that has ever been given to him which he is expected to follow. He is given budgets and have always been at liberty to price the applicant's products within the parametres which would allow him to achieve the budgets.
He admits that the second respondent distributes TMQ and Zinc Bacitracin, and that TMQ and the applicant's TM 100 and TM 200 are competing products but denies that TMQ is a replacement product for the applicant's products. A customer in possession of TMQ would not need TM 100 or TM 200.
He denies that he ever sold or promoted TMQ on behalf of the second respondent.
He further alleges that he did not make the alleged statements to Mr Swindon. In any event, he would not have been in a position to persuade Mr Swindon to purchase TMQ from the second respondent, as the product to be used is prescribed by a veterinary surgeon and the customer is obliged to follow the veterinarian's instructions. He would therefore have had to approach Avi Pharm's veterinarian to convince him to prescribe TMQ, something which he never did and had no reason to do.
He denies that the applicant had TMQ in stock or that it ever had TMQ in stock.
He admits that he told Ms Wessels to refer the order for TMQ received from NVS Biocare to the second respondent.
He is not a signatory on the bank account of the fourth respondent and he has no knowledge of the transactions of the fourth respondent.
Payment of the airticket mentioned in the founding affidavit was the responsibility of the applicant's Finance Manager, Mr Cloete. He was not involved.
He admits that there was an arrangement with Ms Wessels that she would perform certain administrative tasks for the third respondent for which she would be paid R2 000,00 per month by the third respondent. He also admits that the third respondent paid Ms Wessels an amount of R10 000,00 but does not know what amount, if any, is still owing to her.
The business of the third respondent is small and is conducted by Mr Moore who uses his cellular phone for purposes of the business.

If Ms Wessels performed some of the tasks for third respondent during working hours, that was not done in terms of the arrangements concluded with her.
Third respondent had its own computer with which orders and invoices can be generated and printed. Ms Wessels was supposed to use the third respondent's computer. If she made use of the applicant's computer for these purposes, he is not aware of that fact and it was not in terms of the arrangement with her. Confirmatory affidavit of Mr Hugh Moore was attached.
5. APPLICANT'S REPLYING AFFIDAVIT

It was attested to by Mr J M Bendheim, employed by Phibro Animal Health Inc, as Director: Sales and Marketing for the Europe, Middle East and African Regions.
He alleges that the disciplinary hearing against first respondent was fair and chaired by an independent person.
At the time of the first respondent's appointment as Country Manager: Southern Africa, he was also appointed as director of the applicant with effect from 1 December 2000. He resigned as a director with effect from 30 June 2006.
The first respondent does not deny that he made no attempt to disclose his interest in the fourth respondent to his superiors and/or the applicant.
The complaint against the third respondent is, in part at least, not that it sells "Histosol" or "jet mixer" but that it has received proceeds from sales of products which are exclusively manufactured and sold by the applicant.
The first respondent received certain financial benefits from the second respondent.
PWC investigators have found a letter dated 4 July 2006 on the applicant's server written on the second respondent's letterhead. In the letter the first respondent represents that he is a "Director" of the second respondent and writes to Hennie Joubert of Buffalo Freight Systems (Pty) Ltd.
The second respondent has been using Mr Chris Cloete (the applicant's Finance Manager) to reconcile its accounts with a customer of the applicant and of the second respondent.
National Veterinary Suppliers (Pty) Ltd ("NVS") has been communicating with Mr Cloete for some time, since 2006. Representatives of NVS sent e mails to Mr Cloete in relation to substantial sales of Zinc Bacitracin and TMQ. In these e mails which were attached to the replying affidavit, NVS asked Mr Cloete to reconcile the accounts of the second respondent.
Since July 2006 the applicant has not made any sales to NVS. 0n the other hand, the second respondent has during the same period made substantial sales of TMQ (a product which competes directly with TM 200) to NVS. The second respondent sold TMQ for R540,00 per bag to NVS in May and June 2006. During that same period the average selling price of the applicant's TM 200 was R507,00. Despite that, NVS stopped purchasing from the applicant for reasons other than price. The only reasonable inference in the circumstances, and in particular given the affidavit of Mr Swindon, is that NVS were persuaded by the first respondent to purchase TMQ from the second respondent.
The PWC investigators have uncovered further evidence of the use of the applicant's intellectual property and resources by the second respondent. He referred to a series of e mails which were attached to the replying affidavit.
Tandie Rogerson who appears to work for Afripack, sent an e mail on 29 July 2005 to Jeff Cutler (a packaging designer from Stallion Repro) and copied Caroline Wessels. In this e mail Rogerson requested Cutler to "e mail the current design for Phibro TM 200 as the customer wants to make some changes".
Ms Wessels has confirmed that Cutler was responsible for designing the packaging upon the instructions of the first respondent which the applicant uses to distribute TM 200. It paid Cutler for this service.
At all material times Ms Wessels was acting under instructions from the first respondent.
0n 4 August 2005, Ms Wessels responded to Rogerson as follows:

"Thank you for your quick response. Please understand that this is not a replacement bag but an additional bag. We would like a quote on 5 000 bags on exactly the same bag as the TM 200 bag for Phibro but with the following changes: 1. The Phibro logo should be replaced with the Animate Animal Health (Pty) Ltd logo. 0ur printers GR Press, will e mail you the logo as soon as you let me know what format you prefer the logo to be in and the e mail address of the person responsible. 2. The product name TM 200 should be replaced with TMQ. 3. The Company Registration number should be replaced with … 4. The P.O. Box and physical address will stay the same. … 7. The Registration holder should change to Animate Animal Health (Pty) Ltd …"
Ms Wessels confirmed to him that the contents of the e mail were dictated to her by the first respondent.
The first respondent has, at the time of the establishment of the second respondent, assisted the second respondent in a variety of ways, by, inter alia, drafting the distribution agreements on behalf of the second respondent using the distribution agreements of the applicant as a precedent. Some of the draft agreements prepared for the applicant were found by PWC investigators on the applicant's server.
The agreement used by the second respondent for distribution of TMQ was in material respects similar to that used for the distribution of TM 200 by the applicant.
After the establishment of the second respondent, the first respondent diverted sales from the applicant to the second respondent. The first respondent, inter alia, informed customers to purchase TMQ (a competing product) from the second respondent.
From the date it was established the second respondent utilised the resources of the applicant, namely its employees, postal address, office equipment and intellectual property.
What has been discovered so far is, inter alia, that the second respondent has paid for the first respondent's daughter's horse riding lessons, and that Mr Hattingh has agreed to "leave" 50% of the shares in the second respondent to the first respondent. It has also been discovered that the second respondent has also paid an amount of R684 000,00 to the third respondent (in which the first respondent is a sole director and shareholder) for "product development".
He referred to certain documents which were attached to the papers which indicate that on a number of days Mr Cloete and Ms Wessels processed or were asked to process account payments, invoices or other documents relating to the third respondent during office hours. In some of the e mails it was the first respondent who requests, during working hours, that Mr Cloete and Ms Wessels perform work for the third respondent.
He referred to a letter, on the letterhead of the applicant dated 14 November 2001 addressed to a customer by the first respondent. In the said letter the first respondent promotes products of the applicant, together with the products of the third respondent.
He further alleges that the pricing strategy of the applicant is determined in conjunction with the first respondent as the most senior employee of the applicant in South Africa.
The first respondent as the most senior employee of the applicant in South Africa, is in possession of the following confidential information belonging to the applicant:

(i) historic and current selling prices – this information is contained in a document called price list, a copy of which is in his possession;

(ii) itemised lists of sales of products to customers – this information is also documented and the first respondent is in possession thereof;

(iii) sales proposals generated by the applicant;

(iv) the applicant's financial results which include profit and loss statements, price volume reports and expense reports;

(v) the applicant's cost of goods or materials – this information is also documented and was not returned by the first respondent when he was dismissed;

(vi) the applicant's budget and strategic business plans – the first respondent participated in the creation of these documents and he did not return same on his dismissal;

(vii) the applicant's scientific and clinical trials of certain products and registration documents for introducing new products. The new products are in the process of being registered by the applicant.
He denies that TMQ and TM 200 requires a prescription by a veterinarian. He further states that in South Africa stock remedies may be registered for use and distribution either in terms of the Fertilizer, Farm Feeds, Agricultural Remedies and Stock Remedies Act, 36 of 1947, or the Medicines and Related Substances Act 101 of 1965. The Medicines and Related Substances Act, supra, requires prescription by a veterinarian before a stock remedy can be distributed. The Fertilizer, Farm Feeds, Agricultural Remedies and Stock Remedies Act, supra, does not require prescription by veterinarian before a stock remedy can be distributed.
TM 200 and TMQ are both registered in terms of the Fertilizer, Farm Feeds, Agricultural Remedies and Stock Remedies Act, supra. There is therefore no requirement in that Act for prescription by a veterinarian. The same applies to Zinc Bacitracin and Stafac 500.
He referred to the affidavit of Mr Swindon which was attached to the replying affidavit.
The said affidavit of Mr Swindon reads partly as follows:

"3. 0ver the years, I have purchased TM 200, Stafac 500 and other products from the applicant.

4. In 2005, the first respondent informed me that a product similar to TM 200 was available from the second respondent.

5. The first respondent informed me that he had an 'interest' in the second respondent.

6. The first respondent advised me to purchase TMQ 200 from the second respondent instead of TM 200 which is produced and distributed by the applicant.

7. For the period 2005 to 2006 I purchased TMQ 200 from the second respondent. …

9. I was not told by a veterinarian to buy TMQ 200. I did not require a prescription to buy either TMQ 200 or TM 200 as they are interchangeable and I could choose to buy either."
The deponent admits that the applicant did not have TMQ in stock. The reference to TMQ in the founding affidavit is an error. It should have read: TM 200.
The raw materials used in both products, TMQ and TM 200 are the same. Where a customer requires TMQ, the same requirements could be fulfilled by supplying the customer with TM 200.
He referred to documents discovered by PWC, namely invoice and proof of payment by the second respondent to the third respondent of an amount of R684 000,00 for what is termed "services in product development", and alleges that that is part of proof that first respondent was or is benefiting financially from the activities of the second respondent.
He referred to the discussions that he had with Mr Brian Gagiano, who informed him that first respondent and Mr Hattingh approached him with a business proposal during May 2005. First respondent and Mr Hattingh were advancing the interests of the second respondent to the detriment of the applicant.
He further alleges that in the answering affidavit, the first respondent falsely denied that he was a signatory to the banking account of the fourth respondent, and he referred to bank documents he received from bankers of the fourth respondent where first respondent is mentioned as one of the signatories to the said bank account.
He referred to a payment of R273 600,00 made by fourth respondent into the account of third respondent on 14 March 2005.
Mr Brian Gagiano, the Managing Director of Hexachem (Pty) Ltd, alleges that during April 2005 he was approached by Messrs Hugo Hattingh and Hannes Groenewald – they were referred to him by one of their Zinc Bacitracin customers, Mr Ted Swindon of Avi Pharm regarding Hexachem's animal feed items.
Messrs Hugo and Groenewald informed him that they had set up a new company known as Animate to market and distribute in feed products in South Africa.
They also discussed Hexachem entering into a daughter registration agreement with Animate for the distribution of Zinc Bacitracin, as Hexachem was a registered distributor of the product in question with the Department of Agriculture.
They held another meeting on 26 May 2005. His understanding of the discussions was, inter alia, that Mr Groenewald would resign from the applicant and join the second respondent as soon as second respondent has started to grow.
Mr Gagiano further alleges that he was informed that there were other employees of the applicant who were going to join the second respondent at a later stage.
He held several meetings with Messrs Hattingh and Groenewald at various places, and the majority of meetings were held at the applicant's offices situated in Gauteng.
He later received two documents from second respondent being a "Confidentiality and Non Disclosure Agreement". These documents were intended to be agreements to be entered into by Hexachem and the second respondent. At all times during the negotiations Mr Groenewald was involved.
6. COURT HEARING ON 19 JUNE 2007

0n the abovementioned date, on application of the applicant's counsel, the court granted by default an order in terms of prayers 3, 4, 5 and 6 of the notice of motion against the fourth respondent, together with costs on an unopposed scale.
The applicant's counsel and counsel for the first and third respondents, handed to court a settlement agreement. The said settlement agreement was made an order of court. The said court order reads as follows:

"It is ordered that, for a period of one year from date of judgment:

1) The respondent is interdicted and restrained from selling and/or distributing and/or tendering and/or offering for sale and/or marketing TMQ and Zinc Bacitracin and/or substitutes of TM200 or TM100 to customers of the applicant.

2) The respondent is interdicted and restrained from approaching and/or communicating with customers of the applicant in order to sell and/or distribute and/or tender and/or offer for sale and/or market products to them that are sold and distributed by the applicant, or substitutes thereof.

3) Respondent is directed to pay the costs of this application."

After the settlement agreement was made an order of court, the second respondent's counsel advised the court that they intend proceeding with their application to strike out certain portions of the applicant's replying affidavit.
The said application was opposed by the applicant.
The second respondent's counsel submitted, inter alia, that the applicant's replying affidavit contains new information which does not appear in the founding affidavit. It was further submitted on behalf of the second respondent that second respondent has no right to deal with the new matters raised in the replying affidavit.
I should mention that in the affidavit attached to the application to strike out, Mr Hattingh, on behalf of the second respondent, stated that the second respondent would, given permission by the court and sufficient time, be in a position to respond to the new matter raised by the respondent in the replying affidavit.
0n the other hand, the applicant's counsel submitted that if the court finds that the replying affidavit contains new information, then the court should exercise its discretion and allow the second respondent an opportunity to deal with the new information contained in the replying affidavit.
Some of the information contained in the replying affidavit came to the knowledge of the applicant after the current application was issued and served on the respondents. The applicant could not have included the said information in its founding affidavit. The said new information contained in the replying affidavit, in my view is relevant to the issues in dispute and justice and fairness requires that the court should consider said information in order to arrive at a just decision. The said new information amplifies what is contained in the founding affidavit. It does not create a new cause of action.
The second respondent did not have an opportunity, prior to the hearing on 19 June 2007, to deal with the said new information.
The court dismissed the application to strike out and reserved the question of costs.
In order not to prejudice the second respondent, after dismissing the application to strike out, the matter was postponed sine die and the second respondent was given an opportunity to file further affidavits, if so advised.
7. SECOND RESPONDENT'S FURTHER AFFIDAVIT

It was attested to by Mr Hugo Hattingh, a director of the second respondent. He alleges that this affidavit is made in response to new matters raised by the applicant in its replying affidavit.
He alleges that the applicant has sold its distribution rights to Virbac RSA (Pty) Ltd.
The applicant being a locally incorporated company, distributed products of an American company. These are the alleged rights of the applicants which the applicant seeks to protect in terms of this application. The said rights have now been alienated to Virbac RSA (Pty) Ltd. The latter company competes with the applicant in distributing products with its active material being oxytetracyclene and Zinc Bacitracin.
The applicant no longer distributes any products within South Africa. It is the applicant's "parent company" which now distributes products branded as "Phibro" through the agency of Virbac RSA (Pty) Ltd.
The applicant no longer trades, does not have business promises and does not have staff.
He has vast experience in the industry under consideration and there is no product which is in the industry and he is not aware of, nor is there any customer in the industry who is not aware of or alternatively, who he has not dealt with.
He further alleges that Mr Swindon is misleading the court. He has known Mr Swindon for many years. He has dealt with Mr Swindon for many years. The first respondent did not introduce Mr Swindon to him. He has personally advised Mr Swindon about the products which the second respondent distributes.
In the answering affidavit he might have created a misperception by creating an impression that he is of the view that one requires a veterinarian's prescription to distribute TMQ and Zinc Bacitracin. This is not what he intended to convey. A prescription is not a legal requirement, but it is highly unusual that an animal breeder in this industry would utilise the product unless it has been recommended by a veterinarian.
TM 100 as originally distributed by the applicant and now by Virbac RSA (Pty) Ltd needs a prescription from a veterinarian.
He further alleges that he contemplated bequeathing in his will 50% of the shares in the second respondent to the first respondent in the case of his death.
He admits that Ms Wessels in the years 2005 after the incorporation of the second respondent, on