Husband and wife lose Gestetner case

A husband and wife team has lost out on a bid to force printer importer Gestetner to fork out R31 million in damages, after a recent South Gauteng High Court ruling.

The ruling found there was “no paper trail” between Safika for Office Automation and what was, at the time of the matter in dispute, NRG Gestetner, to substantiate a R31 million damages claim by Safika.

In the initial judgement, a lower court found that Gestetner breached a contract with Safika and owed it R206 156 in damages. Safika took the matter on appeal, arguing that the damages should be R31 million.

The dispute centred on the “spoils of a lucrative state tender” and how this was to be divided up, said judge Roland Sutherland in the appeal ruling. Safika was awarded the deal to provide printers to government between June 2003 and May 2006. In 2009, Gestetner became Ricoh SA.

Gestetner was the local importer and exclusive distributor of the copier specified in the tender and the sole source of the product, wrote Sutherland in the ruling.

In terms of a tacit deal, Safika and Gestetner agreed to split the proceeds from the tender with Gestetner's other franchisees around the country as its territory was limited by Gestetner. It would retain all income from Gauteng-based orders.

Safika comprises a husband and wife team, Mr and Mrs Albertus, who lacked the “organisational capacity to fully exploit the opportunity, because it was Johannesburg-based and had no country-wide reach,” states Sutherland.

Gestetner had other arrangements with independent traders in SA that also limited their reach, said the judge. Sutherland said Safika and Gestetner made arrangements to facilitate collaboration between Safika and its other dealers, but no written deals were ever signed.

Gestetner “was embarrassed by the conflict of interest, which arose from supporting [Safika] in respect of the state tender throughout the whole country and the necessary trespass that would cause on the exclusive trading territories of its other franchisees”.

The appeal was dismissed.