Heidtmann & du Preez Attorneys

03/09/2026

03/09/2026

Whistleblower Reinstated: Protected Disclosures Act to the Rescue
"…the threat of disciplinary action can be held as a sword of Damocles over the heads of employees …" (Supreme Court of Appeal)

The Labour Court’s recent reinstatement of a dismissed whistleblower has confirmed that our laws will robustly protect anyone who reports wrongdoing in the workplace.

“The Whistleblower’s Act” removes the Sword of Damocles

The Protected Disclosures Act (“PDA”) – commonly referred to as the “Whistleblower’s Act” – protects employees, independent contractors, consultants, agents and workers employed by labour brokers from retaliation after reporting unlawful or improper conduct.

Without that protection, as our courts have pointed out, “the threat of disciplinary action can be held as a sword of Damocles over the heads of employees to prevent them from expressing honestly held opinions to those entitled to know of those opinions. A culture of silence rather than one of openness would prevail.”

The Act is complex, and its application is full of grey areas, so specific advice is essential. But in a nutshell:

The PDA applies to both public and private sector employers.
Employers must have in place “internal procedures for receiving and dealing with information about improprieties”.
Any form of reprisal against a whistleblower – not just dismissal but any type of “occupational detriment” (disciplinary action, demotion, suspension, harassment, intimidation, compulsory transfer and the like) – will expose an employer to harsh penalties.
If the reprisal takes the form of a dismissal, it is “automatically unfair” and could result in reinstatement with retrospective back pay, compensation of up to 24 months' remuneration if reinstatement is inappropriate, payment of actual damages and other appropriate relief. Occupational detriments other than dismissal are deemed to be an “unfair labour practice” with a similarly wide range of remedies.
Any disclosure is protected if made in good faith and with a reasonable belief that it is substantially true, not for personal gain, and in circumstances where it is reasonable to make the disclosure. Employees should be careful here: groundless speculation is not enough, and a whistleblower acting maliciously or recklessly in disclosing false information risks criminal prosecution. Acting in good faith and reasonably is the key.
Once the employee presents evidence to show that the protected disclosure was the reason, or just one of the reasons, for the disciplinary action, the employer must show that it disciplined the employee for a fair reason such as misconduct unrelated to the disclosure.
Dismissed for breaching policy or for talking to the SIU?

In the case in question, a Facilities Manager accused his employer (the National Student Financial Aid Scheme, a public sector organisation) of unfairly dismissing him.

He had become seriously concerned when a tender specification for new office space was approved without being signed off either by him or by his immediate line manager. That, he said, was a fundamental procedural irregularity because he was effectively the “end user” representative in procurement processes related to lease agreements.

Worse still, the employer went ahead and accepted a lease option that was both more expensive (we’re talking big money here, with rental to the tune of R2 million per month) and less practical (it needed extensive fitting-out before occupation) than another, more affordable option. A proposed five-year extension of the lease reinforced the manager’s belief that irregular and wasteful expenditure was being incurred.

He did everything he could to alert senior management to his concerns, exhausting all the internal reporting mechanisms available to him – but to no effect.

Then came a break, when the Special Investigating Unit (SIU) was called in by the President to investigate irregularities at the organisation. The manager, on the advice of his employer’s internal audit lead, told SIU investigators about the serious procurement irregularities he had identified.

To support his disclosures, and out of fear of victimisation and to preserve evidence, he emailed relevant emails and other documents to his private email address, forwarding them to the SIU.

When these disclosures were leaked into the public domain, his employer launched an investigation into the source of the leaked information. It identified the manager as the informant and dismissed him for contravening its ICT (Information and Communication Technology) policies by forwarding work emails to his personal email address.

The Court however accepted the manager’s contention that his dismissal was not genuinely about a breach of policy but was instead a pretext for retaliation. His contraventions of company policy were an integral part of the disclosure process, his disclosures were protected, and his dismissal was automatically unfair.

His employer must reinstate him with full back pay, and, to rub salt into its wounds, it must also pay all his legal costs on the punitive attorney and own client scale.

Tips for employees

Make sure that your disclosures will pass all the tests we set out above and follow the correct procedures in making them. As we said above, good faith and reasonableness are your watchwords here.

Tips for employers

Put a whistleblower policy in place and tell all your employees about it. It’s not just a legal requirement: your business can only benefit from uncovering any improper or criminal conduct going on behind your back.

27/08/2026

Does the Consumer Protection Act Protect Every Tenant?
“It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.” (attributed to Mark Twain)

A married couple moved to Australia and rented out their South African family home while they tested the waters Down Under. Years later, once they had decided to remain abroad, they sold the property and gave their tenant notice under a clause that allowed them to cancel the lease on three months' written notice.

The tenant argued that the lease was protected by the Consumer Protection Act (CPA) and could only be cancelled if he had materially breached it.

A recent Supreme Court of Appeal decision explains why the tenant’s CPA argument failed, but also why the landlords could not require him to vacate without following the proper eviction process.

Not every landlord is in the letting business

For a residential lease to fall within the CPA's definition of a rental, the letting must take place in the ordinary course of business.

The court found that the couple were not in the business of letting property. They had let out their own home as a temporary measure while deciding whether their move abroad was permanent, not as part of an ongoing letting business.

They were not continually marketing rental services and were therefore not suppliers as contemplated by the Act. Their tenant, in turn, did not qualify as a consumer. On this basis alone, his reliance on the Act failed.

Where the line actually falls

Whether a lease falls within the CPA depends on its factual setting. What matters is whether letting property forms part of the landlord's ordinary, continuing business activity.

A court must look at what business the landlord actually carries on and how that business operates. The fact that rent is being paid does not settle the question on its own.

A valid cancellation does not authorise an eviction

The High Court upheld the cancellation of the lease and ordered the tenant to leave by a fixed date.

The Supreme Court of Appeal set that order aside. Requiring the tenant to leave was, in effect, an eviction order, but the process required under the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (PIE) had not been followed.

Under PIE, a court must decide whether eviction is just and equitable and determine an appropriate date for the tenant to leave.

A landlord therefore cannot treat cancellation of a lease as an automatic eviction. Cancelling the lease and evicting the tenant are two separate legal steps.

Two questions, not one

For landlords and tenants alike, the lesson is to keep these questions separate. First ask whether the lease falls within the CPA by looking at the nature of the landlord's letting activity. Then, if the lease has ended and the tenant remains in occupation, the eviction process must still be dealt with under PIE.

A cancelled lease ends the contract, but it does not remove the tenant.

Not sure whether the CPA applies to your lease or whether the correct eviction process has been followed? Speak to us before taking the next step.

20/08/2026

Can Family Conflict Kibosh a Trust?
“The palest ink is better than the best memory.” (Chinese proverb)

A founder dies and the family disagrees about what should happen to the assets. Then some beneficiaries produce emails proving they know what he wanted to happen. Surely the court can step in and wind up the trust?

Not so fast. A recent Supreme Court of Appeal decision shows that a founder’s later wishes do not, without a formal amendment, override the terms of the trust deed.

In black and white

The trust at the centre of the dispute had been created decades earlier as a discretionary trust, holding business interests and assets worth more than R100 million. The trust deed gave the trustees wide discretion, including the sole power to decide when, if ever, to fix a "vesting date" and distribute the trust's capital.

In his final years, the founder became seriously ill and had a series of conversations with his family about what should happen to the trust after his death. He wanted the capital shared equally, without selling the businesses to achieve it. Those wishes were recorded in emails and memoranda, but the trust deed itself was never formally changed to reflect them.

After he died, the family split. Some beneficiaries wanted the trustees to fix a vesting date and distribute the assets. The majority of the trustees refused, relying on the discretion the deed gave them.

Wishes are not amendments

The dispute reached the Supreme Court of Appeal under section 13 of the Trust Property Control Act. This allows a court to vary or terminate a trust provision, but only where the provision produces consequences the founder did not foresee, and only then if it also hampers the trust's objectives, prejudices beneficiaries, or conflicts with the public interest. If the first requirement is not met, the court's power under the section is not triggered at all.

The beneficiaries argued that the founder never intended the trustees to delay distribution indefinitely, and that his later wishes showed exactly that.

The court disagreed. The founder's intention had to be determined from the trust deed, not from wishes expressed years later. The deed gave the trustees sole discretion to decide whether and when a vesting date should be fixed and did not tie the trust's end to a specific date or event. Those were the terms the founder had created and remained bound by. His later wishes did not change them, and he never took formal steps to limit the trustees' discretion or alter the deed.

No queue jumping

Because the deed gave that power to the trustees rather than the beneficiaries, none of the family members pressing for distribution had any right to insist that a vesting date be fixed. The court found nothing in the deed's structure that the founder had not foreseen or intended.

The unhappiness in the family, the court found, came from the trust's financial position and the beneficiaries' conflicting demands, not from anything the trust deed itself had done wrong. One beneficiary wanted cash, another wanted specific assets, and the trust's finances could not satisfy both. That left the trustees unable to satisfy everyone's demands, while still acting within the discretion the deed gave them.

Read the fine print

For founders, trustees, and beneficiaries alike, the lesson is to start with the trust deed. Verbal assurances and family understandings, however genuinely meant, do not amend the deed or simply displace its terms.

A trust deed left unreviewed for decades can quietly drift away from what a founder actually intends. Reviewing the deed regularly – and amending it if necessary – will greatly reduce the chances of a dispute.

09/08/2026

Have a wonderful women’s day!

09/08/2026

Cancelled Sale, Damaged Property. Who Pays?
“You do not mend a broken vase by handing over a new one.” (Anonymous)

When a property sale is cancelled, most people picture a straightforward reset. The seller keeps the property, the purchaser gets the money back, and everyone walks away as if the deal never happened.

The law calls this restitutio in integrum, and a recent Gauteng High Court decision shows that putting the parties back where they started can be a far more exact exercise than simply reversing the transaction.

Restitution is not a reset button

The dispute followed the cancellation of a sale involving a smallholding in Kyalami. The purchaser had taken occupation of parts of the property, including a restaurant and farm stall. Transfer had not yet taken place because the financing and other conditions attached to the sale had not been finalised.

In December 2017, while the purchaser was still in occupation, an arsonist set fire to the restaurant. Neither party had caused the fire, but the sale agreement placed the risk of damage on the purchaser. The financing arrangements and other conditions remained unresolved, and the purchaser cancelled the agreement in May 2018 without transfer ever having taken place. He was entitled to repayment of R2,15 million, less the fair and reasonable cost of repairing the fire damage. The court had already decided that the repair costs must be deducted from the purchaser’s refund, but the amount of that deduction was only determined in 2026.

The principle of restitutio in integrum requires the parties to be restored, as far as reasonably possible, to the positions they held before the agreement.

That sounds simple in theory. In practice, years may pass between occupation and cancellation, and the property itself rarely stays the same. A building can be damaged, deteriorate, or simply age. When that happens, restitution has to account for the difference between what was handed over and what is being handed back.

Old does not come back new

The court had to assess the fair and reasonable cost of remedying the fire damage to the restaurant and farm stall, taking into account the condition of the structures when the purchaser took occupation. Parts of the restaurant and farm stall were already in poor condition, and some earlier work had been badly done.

Restitution could not be used to turn an aged or poorly built structure into a new one at the purchaser's expense. Where a proposed repair would leave the seller with something materially better than what existed before, the court reduced the amount allowed.

The purpose is to restore what was lost, not improve what was already there. The question was not what it would cost to replace the structures with new ones, but what it would fairly cost to restore what had actually been damaged.

You can’t deduct the same problem twice

The purchaser argued that, after the court had calculated the cost of each repair, the overall figure should be reduced again to reflect the property’s poor condition before the fire.

The court rejected this argument. It had already reduced the relevant repair amounts to reflect the structures’ age, poor condition, and substandard workmanship. A further general reduction for the property’s overall condition would therefore have deducted for those same problems twice.

The court fixed the fair and reasonable cost of restoration at about R1.36 million. After this was deducted from the R2.15 million repayable to the purchaser, the seller still owed him about R799k.

Record the condition, or argue about it later

The judgment also shows why you should record a property's condition when occupation changes hands.

Where there is no clear record of what a property looked like at handover, parties may be left arguing years later about whether a structure was sound, dilapidated, damaged, or badly built before the purchaser arrived.

Photographs, walk-through videos, inspection reports, inventories, and records of existing defects can matter far more than memory if a sale later collapses and restoration becomes disputed.

In this matter, the condition of the restaurant and farm stall when the purchaser took occupation formed part of the court's assessment of what fair restoration required.

Why the date of cancellation matters

The passage of time did not postpone the financial consequences until the date of judgment.

The sale agreement was cancelled on 31 May 2018. The parties had agreed that interest on any amount ultimately found owing would run from that date, and the court had already made an order to that effect.

By the time the restoration dispute was finally decided in 2026, more than R613k in interest had accrued on the outstanding amount.

Bottom line

Buying or selling property and handing over occupation before the deal is complete? Speak to your attorney about recording the property's condition and making sure the agreement clearly deals with risk.

23/07/2026

Your Dormant Trust Is Not Invisible to SARS
“Things do not go away. They go somewhere.” (Annie Dillard)

Many trustees assume that a dormant trust can be safely forgotten. No income, no assets, no transactions … No problem.

SARS has made it clear that this assumption may be an expensive one.

In recent months, SARS has intensified its focus on trust compliance, targeting trusts that have failed to submit annual income tax returns. What many trustees may not realise is that inactivity does not remove a trust's tax obligations.

A trust that has been sitting dormant for years is still required to submit annual income tax returns. Failure to do so can now result in administrative penalties, even where the trust has conducted little or no activity.

Dormant does not mean exempt

One of the most common misconceptions among trustees is that a trust only has compliance obligations if it earns income, owns assets, or actively conducts transactions.

That is not how SARS views the issue.

According to SARS, all registered trusts, whether economically active or passive, are required to submit annual income tax returns. The obligation exists even where the trust has little or no economic activity.

Why SARS is paying closer attention

Since May 2026, the revenue authority has been issuing administrative penalty assessments to trusts with outstanding returns following earlier final demands for compliance. Trustees who received those demands were given an opportunity to correct the non-compliance before penalties were imposed.

Depending on a trust's assessed taxable income, monthly administrative penalties can range from R250 to R16,000 and may continue accruing if the non-compliance is not remedied.

This reflects a broader shift in SARS' approach to trusts. What was once viewed by many as a relatively passive area of administration is increasingly becoming an area of active oversight and enforcement.

Thinking about winding up a trust?

Many trustees only discover outstanding compliance issues when they begin taking steps to terminate a trust's affairs. By that stage, years of outstanding returns, incomplete records, or unresolved SARS obligations may need to be addressed before the process can move forward.

Importantly, a trust that has effectively ceased operating is not automatically regarded by SARS as deregistered for tax. Trustees remain responsible for ensuring that trust information is maintained, updated, and, where appropriate, formally deregistered through the correct processes. Failure to do so may expose the trust, and potentially its trustees in their capacity as representative taxpayers, to penalties and other consequences under the Tax Administration Act.

Winding up a trust and deregistering it with SARS are not the same thing. A trust that trustees regard as dormant, inactive, or terminated is still regarded by SARS as a registered taxpayer with ongoing filing obligations until it has been properly deregistered.

The position can become particularly costly where penalties have been accumulating in the background.

As SARS continues to invest in data capabilities and automated enforcement mechanisms, historic compliance issues are becoming easier to identify and harder to overlook. In some cases, trusts that trustees believed were inactive for years are now being drawn back into the compliance net.

The lesson is straightforward: before assuming that a dormant trust requires no further attention, trustees should ensure that all filing obligations have been met and that the trust's SARS records are up to date. A trust may be dormant in practice, but that does not mean it has disappeared from SARS' radar.

16/07/2026

How to Protect Your Company from Unlawful Springboarding
"All’s fair in love and war, but not in business." (Modern twist on the old proverb)

Your business is flying after years of hard work and personal sacrifice. Suddenly, your most trusted employees resign and set up in direct opposition to you. The speed with which they do so makes you realise there’s something fishy going on.

Sure enough, they are brazenly using your confidential knowledge, resources and client relationships against you.

A recent High Court decision provides a perfect illustration of how our law can and will protect you from that sort of unfair competition.

A new business and software in 11 days? Something’s fishy

This unhappy saga starts with a company in the niche business of measuring and analysing diesel engine emissions. Monitoring these emissions is important in several industries, most notably the underground mining industry. It’s the first and only such business in South Africa thanks largely to two factors: firstly, its exclusive Africa-wide distribution agreement with a German supplier of specialised equipment, and secondly, its founder’s development of custom software.

All went well until two of the company’s senior managers resigned from their positions. Just 11 days later they had set up their own business in direct opposition to their erstwhile employer. One can only imagine his distress and anger when he realised that they were using the fruits of his technical expertise and hard work to try to poach his clients from him.

He lost no time in taking legal steps, and when the managers refused point blank to stop trading, he asked the High Court for an order forcing them to do so.

What is springboarding?

“Springboarding”, as the Court put it, “entails not starting at the beginning at developing a technique, process, piece of equipment or product, but using as a starting point the fruits of someone else's labour.”

Competition and entrepreneurship are of course healthy and to be encouraged, but only if they are lawful. Springboarding grounded in unlawful conduct is prohibited.

From springboarder to belly flopper

The evidence of unlawful conduct in this case was overwhelming. For example, one of the managers had months previously been suspended under suspicion of planning a competing business after a budget for a new venture, including a provision to buy the specialised German equipment, was found on his laptop. In due course their new company duly bought the equipment, despite them having full knowledge of the distribution agreement in favour of their employer (they couldn’t deny knowledge, having actually signed the agreement on behalf of the employer).

The Court was also sceptical of the new company’s claim to have developed its own independent software in a matter of weeks, especially in light of evidence that, shortly before resigning, one of the managers had emailed his employer’s software to himself.

The final nail in the managers’ coffin was that their marketing presentations to two of the employer’s clients were sufficiently similar to the employer’s presentations for the Court to conclude that they were using its business model, methodology, equipment and software against it.

As regards their terms of employment, only one of the employees had signed a contract (it included a confidentiality clause). But what mattered was not their contracts, but that as employees they had a general fiduciary duty to act in good faith and in their employer’s best interests.

Referring to the abundant evidence of their misuse of confidential information gained during their employment, the Court slammed the managers and their new company with a series of orders that will presumably cripple their new venture, at least for now.

They and their new company are prohibited from unlawfully competing with the original business for eighteen months, they must return all confidential information and documentation (deleting electronic copies), and cannot disclose the information to anyone else. What’s more, the Court ordered them to pay costs on the punitive attorney and client cost scale.

A checklist to protect your business from springboarding

The employer is victorious, but it’s taken him almost a year to get here, and inevitably his business (and he personally) will have suffered.

With prevention always being a great deal better than cure, you can protect your business from going through all the delay, cost, trauma and business risk of a court fight with this checklist:

Watertight contracts. Your employment contracts, particularly those relating to senior staff with access to vital confidential information, should contain strong confidentiality, non-disclosure, good faith, conflict of interest and restraint of trade clauses. This employer was able to rely on a breach of his employees’ general fiduciary duties, but his position would have been that much stronger had both senior managers been bound contractually as well.
Widen the net. Looking beyond employees, consider also other business partners like suppliers and contractors who might gain access to confidential information, and structure your agreements with them accordingly.
Quantify your worth. Identify and list all your confidential information: intellectual property, technical know-how, client and other business relationships, pricing strategies, business strategies, trade secrets and any other sensitive information.
Be prepared. Check that everything is held securely, that access is limited on a need-to-know basis to trusted personnel, and that access is recorded. This way, if you are stabbed in the back by an employee, you’ll be able to prove misconduct and breach of fiduciary duty.
No stone unturned. When staff leave, remind them (in writing) of their duties in regard to confidential information, and recover all company documentation, laptops etc before they leave.
Be vigilant. Monitor for “information leaks” and for any other possible misuse of confidential information. Increase your monitoring when staff resign. Keep an eye on your competition for any signs of them using information leaked from within your ranks.
Perhaps most importantly, act decisively at the first hint of a springboarding attempt. A robust lawyer’s letter will often be enough to nip the problem in the bud.