Rajkumar Tahilram v Trustees for the Time Being of the Lukamber Trust and Another

Mr Rajkumar Tahilram held 30% of the shares in A & A Dynamic Distributors (Pty) Ltd, with the remaining 70% held by the Lukamber Trust. Upon termination of Mr Tahilram’s employment on 27 March 2018, the shareholders’ agreement required him to offer his shares to the trust. The parties could not agree on the fair market value of the shares, triggering a contractual mechanism whereby the company’s auditors, Odendaal & Co, were to determine the value, such valuation being final and binding once communicated. The auditor issued written valuation reports in July 2018 determining the company’s value and the realisable value of obsolete stock. Both parties ultimately accepted this valuation, and the trust accepted the offer to purchase Mr Tahilram’s shares. However, when Mr Tahilram demanded payment, the trust relied on a revised valuation prepared unilaterally by the auditor in July 2019, reducing the original value. The High Court held that the auditor was entitled to amend his valuation and dismissed Mr Tahilram’s claim. Mr Tahilram appealed to the Supreme Court of Appeal.

The appeal was upheld with costs. The High Court order was set aside and replaced with an order directing the first respondent to pay Mr Tahilram R2 878 574.70 as the purchase consideration for his shares, together with interest at 10.25% per annum a tempore morae and costs.

This judgment authoritatively clarifies South African law on expert valuations in contracts, confirming that expert valuers are functus officio once their valuation is communicated. It reinforces commercial certainty by limiting post hoc interference with agreed valuation mechanisms and confirms that only a court, on narrow grounds, may interfere with or set aside an expert valuation.