Media24 (Pty) Ltd v Estate of Late Deon Jean du Plessis

Media24 (appellant) owned 80% and the late Deon du Plessis (first respondent's deceased) owned 20% of shares in Daily Sun (Pty) Ltd. Media24 engaged in a restructuring exercise involving expansion to other provinces and outsourcing printing services to its subsidiary, which significantly increased costs charged to the company and impacted share values. The deceased protected his interests by stipulating in a contract (the third agreement) that upon his death, Media24 would acquire the remaining 10% shareholding (in two tranches) at a price calculated according to a formula considering the pre-restructure company structure. When the deceased died, the parties could not agree on the purchase price and appointed Mr Charles Stride (second respondent), a chartered accountant, as an independent expert. The parties provided a briefing document setting out the mandate and agreed to be bound by the expert's findings absent manifest error. The expert produced a detailed report valuing the shares. Media24 rejected the valuation, alleging manifest error in that the expert exceeded his mandate, particularly by relying on Annexure 1 (which contained 2007 figures and was admittedly outdated) and by allegedly miscalculating the second tranche price.

• Whether the independent expert committed a manifest error in his valuation report
• Whether the expert exceeded the terms of his mandate by relying on outdated Annexure 1
• Whether the expert correctly calculated the purchase price for the second tranche of shares
• What constitutes a 'manifest error' sufficient to set aside an expert determination
• Whether parties are bound by an expert's determination even if it contains errors, absent manifest error

The appeal was dismissed with costs.

An expert determination can only be set aside for "manifest error," which means an error that is plain and indisputable and amounts to a complete disregard of the controlling law or credible evidence. Where an expert is mandated to adjust outdated information and does so, reliance on such information does not constitute manifest error. An expert who acts within the scope of the mandate conferred, even if errors in judgment or calculation may exist, has not committed manifest error. The court's review is limited to whether the expert exceeded the mandate or committed a manifest error; it does not extend to rehearing the matter or reassessing the expert's decision-making process.

The court noted approvingly the definition from Winfield v Dimension Data Holdings Limited and the approach from English cases (Dixon Group plc v John Andrew Murray-Oboynkski and Healds Food Ltd v Hide Davies Ltd) that manifest error must be discernible on the face of the determination itself, and the use of the word "manifest" indicates parties do not intend to widen the court's investigation beyond the ambit of the determination itself and any reasoning within it. The court observed that the extensive powers conferred on the expert included making decisions to resolve conflicts, determining appropriate underlying principles, considering the parties' intent, and taking such steps as deemed appropriate to implement the mandate.

This case is significant in South African law for clarifying the scope and limits of judicial review of expert determinations. It reinforces that parties who agree to be bound by an expert's decision can only challenge it on grounds of manifest error, which is narrowly defined. The judgment emphasizes that manifest error does not include errors of judgment or methodology within the expert's mandate, but only errors that are "plain and indisputable" or amount to a complete disregard of controlling law or credible evidence. The case confirms that courts will not rehear matters decided by experts or second-guess their decision-making process unless there is clear evidence the expert exceeded their mandate. It provides guidance on the interpretation of expert mandates and confirms that experts may rely on documents referred to them, even if outdated, provided they properly account for limitations and make necessary adjustments. The judgment reinforces the finality of expert determinations in commercial disputes and the limited circumstances in which they can be overturned.