Tuesday, 6 September 2022

VAGABOND: Disappointing day in court

 I had my first day in court today. Except it wasn't really 'my day' in court. 

There is so much about the legal system and court system that I find inefficient, random and disorganised - and hard to understand. There is so much wasting of time and resources and money. This is from a brief glance. It makes me just want to fix, fix, fix.


The short version of a long story that I have alluded to in my post 'Can you be trusted?' (18 July) is that the factory that makes my Vagabond and YOLO products, as well as those for other customers, defaulted on their rent and the landlord took legal action. I cannot find fault with this as the landlord had every right to claim his money.

That's just the short version. The longer, real and more complicated version has more players, agreements, discussions, other parties, and behind-the-scenes intrigue going on for months. I knew of elements of this but I wasn't involved. To even begin to explain the long version (and there are different views and perspectives) would fill the pages of a book.

Regardless, the outcome of the legal action was that an eviction order was granted and everything in the building was attached under a warrant. That includes the assets, fittings and stock of the factory's customers. This was on 22 June 2022.

We submitted affidavits in July, which excluded our 'disputed items' from the auction of the factory assets scheduled for the end of July. The landlord purchased the factory's main assets, the three ovens, with the plan to run this as his own business. Yeah, I know, the beneficiary of the auction purchasing the assets of the tenant that he is evicting to take over the tenant's business. Contemplate that.

A week after the auction, the auction accounting was wrapped up by the sheriff. The auction achieved 99.92% of the total claim. From what I've read, it looks like auctions usually recover 40-60% of the claim...

It took us TWO WEEKS to get these documents with neither the sheriff's office nor the landlord's attorney handing them over. Was this purposeful denial of access? I have absolutely no doubt. 

We finally got the documents on the same day as we were served summons to appear in court specifically to defend our claim that our kayak moulds, fittings and stock belong to us - despite the 600-plus pages of affidavits submitted in July complete with invoices from suppliers for everything.

The problem here is that the auction should have been wrapped up two weeks earlier with a Return of Service and the fulfilled warrant which would have released all the customer assets. We have still not received a Return of Service.

My life, for the last nine of the 11 weeks that my businesses were locked down, has been all about affidavits, coordinating between the customers (two overseas) regarding legal submissions, news, updates, documents, information and trying to get ready-and-waiting orders released for container shipments. I've also had the excitement of an urgent High Court application, which we won with costs and then the appeal, which we again won with costs.

My focus lurched from lockdown to getting counsel, to coordinating eight affidavit submissions, then looking ahead to the auction, then to getting the auction papers, then to the summons and today's court date. Going from one checkpoint to the next has kept me sane. 

I have spreadsheeted and cloud-saved every document in this case by date, type of document, from whom, to whom and gist of the contents for easy reference. I have also extracted quotes from the documents that are relevant to our case and these are ordered by date and categorised with document, from whom, to whom, page/paragraph location and key words to make it more searchable.

Late last week, the assets of the factory's other customers - except Vagabond, YOLO and the ABC shop we started a year ago (ABC sublet shop space only) - were granted release through a letter from the landlord's attorney to ours. Yes, a few days before the court appearance that they summoned us, the factory customers, to because they disputed our claim to our assets. The companies excluded are all mine.

So that really leaves me isolated and still in the fight.

As it happens, court today was disappointing.

In the morning, my attorney and advocate met with the landlord's advocate. Note that my guys had made numerous attempts to get meetings to mediate. This morning's meeting seems to have confirmed the release of some customer assets with the addition of YOLO moulds (they released - not yet in my hands - only the fittings and boxes last week, which is no use to me without the moulds to make products).

They went into court and there the opposition stated that there was an amount still owing to them (keep in mind that they got 99.92% of the claim total of the warrant governing this case and also that this claim is not against the customers). It came out that an auction had taken place and a payout had been done, which they failed to inform the magistrate in the massive pile of documents that had been handed to her pre-appearance. She didn't know. She asked how much was really owing. They didn't know.

She told them to go away, confirm how much they think they are owed and to be back at 2pm.

We go back and this time I go inside. 

There was a show that I watched on Netflix recently. I can't remember which one but I can remember feeling so frustrated and shouting at the screen "Just talk. Just tell them. Just explain clearly". There was so much stupid stuff going on and only because they people did not speak up. I felt like this here. Running on a treadmill and going nowhere.

The opposition responds to say that they are owed around R24,000. You have got to be kidding! In five weeks, neither the sheriff nor the advocate for the landlord said anything about an outstanding amount. Not. One. Word. Instead, they keep our assets locked down and further compromise seven businesses.

According to the sheriff's accounts, another R806 (yes, eight hundred and six rand) would see them receive 100% of their total claim. They were paid out R1m and yet are holding on to the assets of the customers of the factory, who really shouldn't be involved in this dispute, for what they said today is only R24,000? The magistrate commented that this was decidedly less than what he'd said in the morning and she added, quite rightly, that costs more than this to appear in court. "Sort it out," she said. 

The opposition then goes on about the 'kayaks' in the factory that have not been paid for, which they are claiming. And this wasn't even the topic of the argument on the summons. The magistrate did ask him why he brought this up because it wasn't relevant.

Yes, I did half put my hand up to speak as the advocate was just so very wrong about these 'kayaks'. It is a pity that I didn't get to speak. These 'kayaks' are actually blemished, unfinished and un-outfitted shells that have not been invoiced because they have not been completed. Customers are only invoiced for completed kayaks that we order (A-Class) or agree to take (B-Class). There are only really shells there for three of the customers and two of the three want their shells to be outfitted and completed. 

So the magistrate is left thinking that there are a whole lot of kayaks there that haven't been paid for, and that the landlord is claiming, when this is not the truth or reality. 

How can a magistrate decide on anything when she doesn't have even half the correct information?

So then my advocate does a good presentation to bring attention back to the actual issue - something called the Landlord's Hypothec. Basically, it 'allows' the landlord to claim any items on their premises in the event of a dispute. But, thankfully, there are only certain situations in which this applies. And not this one, which is shown clearly in the law and with case examples too.

Of course, you'll be asking around about now, "If the landlord is claiming Landlord's Hypothec, why has he released the assets of the other customers except Vagabond, ABC and YOLO? What makes them different to the other customers of the factory?".

The answer? Nothing makes them different as they are all separate legal entities and they function as customers of the factory like all the others. 

Court didn't even get to this realisation because no evidence was shown. Today was not a trial but more of a instance to set a trial date. It feels to me like a waste of time and money.

We have a court date for 20/21 October.

I'm sure you see the problem with this date. It is for almost two months in the future. I've had no business or trade for 2.5 months already. We start to move into our main summer season in October. It doesn't take a rocket scientist to calculate the math on this and subsequent impact.

So, why is the landlord doing this? I have a few theories - and all are probably correct to some degree. I'm not going to put them down here because this still has to play out. But, they are not to do with being owed any money - the guy seems to have more than enough. Suffice to say, Vagabond is the one with the most versatile and marketable products.

My focus for the past 10 weeks has been on obtaining counsel, then coordinating the content of eight affidavits, then on the auction, then two weeks on getting the auction papers, then receiving the summons and then on today's court date. Focusing on one and then the next and the next has kept my focus - and kept me sane.

So, after court today, with no resolution, I cracked. I am feeling absolutely devastated and shattered.

We still have a step-by-step process to follow. We have to get the full accounts from the sheriff within the next five days. I don't see that these accounts can or will be any different to the documents issued a month ago on 8 August. Why would there be some other set of accounts? The outcome of this determines the next step.

And, all the while, I am the one that loses the most.

As you can imagine, I am neither very impressed right now with certain people or the law.

This whole case is just so absolutely ridiculous. 

I wish the magistrate had asked for a summary of the situation in plain English, which I would have been happy to provide. 

I wish that she had asked why some claimants' assets were released and not others if the landlord is claiming hypothec.

And, I wish that she had told the landlord's attorney that they were wasting the court's time, and our money by summoning us to court for R24,000 - owed to them by someone else - when they got paid out R1m - 99.92% of their claim.

But, she doesn't know this. If she did, I'm quite sure she would have put an end to this time and money wasting and life devastation. 

This is wrong. Just wrong.

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