Contract judgment setback for Woolworths
In a major setback for Woolworths, former rugby star Tony Watson, who owns a Woolworths convenience store in Mount Edgecombe, near Durban, secured an interdict against the retail giant yesterday, preventing it from opening a bigger store in a shopping centre 200m away.
Durban High Court Acting Judge Gavin Morley ruled that Woolworths had not acted in good faith when it had attempted to open up in direct competition to Watson. He also ruled that Woolworths had placed its own interest above those of Watsons, which, in terms of the agreement between the two, it was not entitled to do, says a report in The Mercury. The store was scheduled to open this week. But the ruling means that it cannot open for as long as Watsons contract with Woolworths, which is set to expire in eight years, stands. As the anchor tenant, and with all the fixtures in place for the proposed opening, the judgment will impact on both the owner of the new centre and on Woolworths. It will also affect the way in which Woolworths contracts with other dealers in the future, and on about 20 other similar franchise agreements already in operation. Full report in The Mercury (subscription needed)