THE epic battle between Bonang Matheba and CSA Global has been the talk of the town or at least within the alcohol industry.
If you don’t know ... now you do!
Last week, Matheba revealed in a Twitter Space that she had terminated her contract with CSA Global and was busy with legal action against the management agency.
According to the businesswoman, “today, I announce that I’ve terminated that contract … and they no longer represent me or any of my business ventures. Furthermore, I have instructed my lawyers to investigate the possibility of criminal conduct by the company and its representatives. I will revert over the next few days with more updates so that others can be aware of what I consider as their very unsavoury behaviour.”
CSA Global has refuted Bonang’s claims and revealed that she was in breach of multiple contracts and had been neglecting the brands, as well as her own, for the past six months.
CSA Global said Bonang’s claims that she brought House of BNG with her to the agency were untrue.
What does this mean for the House of Bonang?
We spoke to a few lawyers about the case so far and what is clear is that you need to understand your contract.
As a business owner you need to know your contracts in and out.
According to Kholofelo Mashitisho, of Mashitisho Attorneys, a contract is an agreement (verbal or written) that is intended to create legal rights and duties between parties.
“Contracts are a big part of our lives and the general purpose of entering into a contract is to fulfil the terms set out in that contract. It is generally a requirement and good practice that the contracting parties follow through with the obligations set out in the agreement.”
Honour the terms
According to Mashitisho, the moment one of the parties refuses to honour the terms they are defaulting and committing a breach of contract which will result in a violation of the sanctity of the contract.
The consequences of refusing to honour the obligation required by you in a contract can be very damaging for your business and/or brand.
“Not only will the reputation of your business and/or brand be tarnished, but the relationships also formed will be damaged. There are also other implications to consider such as cost associated with dealing with a breach as well as the time and effort it will take to resolve. Let’s not forget that a breach of a contract is grounds for the innocent party to institute legal action against you.”
Understand your contracts
Jonathan Goldberg, an expert in labour law and chief executive at Global Business Solutions, argues that understanding your contract is vital.
“What is the importance of understanding contracts that you have signed into? For the employee it is critically important to understand the whole contract that you are signing. Normally the employee only gets a letter of appointment but unless the employee sees and goes through the whole contract and potentially takes some advice on that, they could then be compelled to sign the full contract of employment without really having consideration thereof,” Goldberg said.
“Most letters of appointment refer to the full contracts and policies and procedures that need to be signed before employment will take place.
“It is remarkable that people resign to go to another job without doing a proper thorough analysis of the contract of employment, its conditions and doing a comparative on benefits. Although you might receive more cash in your new offer, the real question is what provident fund, pension fund or medical aid are you joining and what are the benefits comparable to the existing contract?”
How to get out of a contract?
According to Goldberg, the short answer to that is resign. Once you have signed the contract, it is very difficult to get out of it because we are bound to contracts we sign at law, otherwise there would be continuous litigation.
“The legal principle is you are bound to a contract you have willingly signed. Restraints of trade are most probably the most contentious issue in this regard and restraints of trade are enforceable unless the employee who signs such a restraint of trade can prove that it is unreasonable. ’Unreasonable’ is usually in the area it covers and the length of the restraint.”
Common mistakes about contracts
Goldberg says that normally people are so elated by a new offer or intoxicated by the extra cash that they don’t look at the details.
“It is only later that the details become problematic, especially in regard to comparison of benefits and in regard to restraints and confidentiality that employees sign.
“It is critically important before your resignation that you properly analyse the contract, policies and procedures. Most employees don’t do that and unfortunately end up more unhappy than they currently are in their existing jobs.”
Grant Wilkinson, a comercial contract litigator at Global Business Solutions, said that people often take the fine print for granted and with the hurry scurry world we live in, hardly anyone takes the time to read the terms and conditions of the contract.
“This fine print may include automatic renewal clauses especially in terms of certain service providers. It is my advice that anyone entering into an agreement look carefully into it and if there is something that you don’t understand, you ask questions. If you are still not satisfied with the responses to your questions then I would suggest that you seek the assistance of a relevant specialist.”