Stargrow Fruit Marketing (Pty) Ltd v Gamtoosvalley Farming (Pty) Ltd t/a Entabeni and Stargrow Fruit Marketing (Pty) Ltd v New Day Packaging (Pty) Ltd

Stargrow Fruit Marketing (Pty) Ltd (SFM) was an authorized marketer of South African export fruit, holding exclusive licenses for certain citrus varieties. SFM had business relationships with two fruit producers: Gamtoosvalley Farming (Pty) Ltd t/a Entabeni and New Day Packaging (Pty) Ltd. With Entabeni, SFM had a written marketing agreement dated 6 November 2020 valid until 31 December 2029. With New Day Packing, SFM had concluded a Memorandum of Understanding (MOU) dated 28 July 2017 providing interest-free loan funding for orchard establishment, with repayment from fruit sale proceeds. The MOU envisaged separate marketing agreements. Both respondents became dissatisfied with SFM's services and sought to revoke its authority. Entabeni's attorneys gave notice of revocation on 3 February 2025 and 2 April 2025. New Day Packing's attorneys revoked SFM's authority on 2 April 2025, except to the extent SFM had already committed specific fruit to the market in respect of the 2025 harvest, and regarding Clemenlus fruit for the 2025 harvest. SFM claimed it had accepted these exceptions as a 'tender' creating a new agreement and sought urgent interdicts for specific performance requiring delivery of the 2025 harvest.

• Whether a new marketing agreement was concluded through SFM's acceptance of the exceptions contained in the revocation letters
• The proper interpretation of the exception clause in the revocation letters regarding fruit already 'committed to the market'
• Whether the respondents were entitled to unilaterally revoke SFM's authority as their marketing agent
• Whether SFM's authority was coupled with an interest (mandatum in rem suam) rendering it irrevocable
• Whether SFM established the requirements for a final interdict: clear right, irreparable harm, and absence of adequate alternative remedy
• The distinction between revocation of authority and termination of a contract of mandate

Both applications dismissed. In case 1486/2025, the applicant (SFM) was ordered to pay costs with counsel fees on Scale B. In case 1487/2025, the applicant (SFM) was ordered to pay costs with counsel fees on Scale B.

A principal has the right to unilaterally revoke an agent's authority even where this constitutes a breach of the underlying mandate contract, and the agent's remedy lies in damages, not specific performance. Authority is only irrevocable where it is coupled with a protectable interest (mandatum in rem suam), which requires that the authority was granted to secure a debt or obligation, not merely to protect the agent's commercial interests such as earning commission or maintaining business relationships. When interpreting the terms of a revocation of authority, the court applies objective interpretation principles and gives effect to the clear intention of the party revoking, particularly where exceptions are formulated to protect third party rights that have already accrued through binding commitments.

The court made observations about urgency in commercial matters involving perishable goods, noting that while not entirely persuaded the matters warranted the urgency afforded, it dealt with them in the interests of justice given they concerned perishable export fruit and to avoid inefficient use of judicial resources if the matters were simply re-enrolled. The court also commented on the need to distinguish clearly between authority (the power to bind a principal) and mandate (the contractual relationship), noting that confusion between these concepts can lead to uncertainty. The judge observed that even where a contract purports to make authority 'irrevocable', this does not prevent revocation as a matter of law, though it may ground a claim for damages. The court also addressed a procedural issue regarding whether Mr Bezuidenhout snr had authority to act for New Day Packing after ceasing to be a director, noting that authorization to act for a company is not limited to directors and this issue was resolved on the respondent's version under the Plascon Evans rule.

This case provides important guidance on the distinction between revocation of an agent's authority and termination of a contract of mandate under South African law. It clarifies that while a principal can generally revoke an agent's authority unilaterally (even if this breaches the underlying mandate contract), specific performance will not be granted to compel continued agency - the agent's remedy lies in damages. The judgment reinforces the narrow scope of 'mandatum in rem suam' (authority coupled with interest) as limited to situations where authority is granted as security for a debt or obligation, not broader commercial interests such as maintaining supply chains or earning commission. The case also demonstrates the application of objective interpretation principles from Endumeni to unilateral acts (revocation notices) and the importance of carefully drafting exceptions to revocations. It illustrates that urgent interdict applications for specific performance of commercial contracts will fail where the applicant cannot establish a clear underlying right.