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A small Durban tour operator is turning to the courts to block the Hilton Durban from terminating a transport contract signed in 2017.
The operator is laying the blame for the dispute at the feet of a Dubai sheik, who is a new shareholder in the establishment.
In court papers, African Soil Tour and Transfers said the hotel wanted to cancel the contract for no bona fide reasons, while it had also learnt that an entity owned by Khalaf Ahmed Khalaf Al Otaiba, a resident of the United Arab Emirates and the new owner of the Hilton, had taken over the hotel’s transport and tour duties.
“I have the suspicion that he is the reason behind the unfair, and I believe unlawful, attempt at cancelling the agreement,” African Soil director Ekaterine Papadakis said in her founding affidavit.
Papadakis said a company called Bungi Corp Trading, owned by Khalaf, had purchased vehicles to be used by the hotel to facilitate the operation of transport and tours.
In a separate application, already before the Durban High Court, Papadakis wants the court to declare the Hilton Durban’s action unlawful. In this application she wants the court to interdict the hotel from taking business away from her until the contract dispute is settled. The interdict application is due to be heard before the high court on Friday.
Papadakis said in early November 2017, African Soil received a request to make transport available for guests from King Shaka International Airport to the hotel. She later learnt that one of the gentlemen was, in fact, the new owner.
“This was a little concerning insofar as during our interaction he had made certain comments that caused me to believe that he was not impressed by having to deal with a female driver, tour guide and/or business partner.”
The deal was negotiated in October 2017 with Markus Fritz, the hotel’s general manager, and the three-year service was set to begin on November 1 of that year.
At least one Mercedes-Benz and one Hyundai would meet the hotel’s image, Papadakis said. African Soil then purchased the vehicles on an instalment sale agreement to the value of R3.5 million, putting up, among other items, the Papadakis family house as security.
She said the issue with the termination clause was discussed during negotiations.
“I asked that the termination clause be reworded to reflect what I viewed to be the common law position, namely that the contract would only be terminated on breach of contract and where the breach had not been remedied.”
Fritz, said Papadakis, warned that rewording the clause would cause a delay as the agreement would have to go back to Hilton’s lawyers in the US for approval and African Soil could lose out.
“He, however, confirmed that it was not possible for the hotel to simply cancel for no good reason,” she said.
African Soil was to also be given time to recoup its investment over a minimum of two years under favourable economic conditions, she said. Should the contract be cancelled, African Soil faced a R5.8 million debt and seven permanent employees would be out of work.
However, some six months later, in April last year, Fritz informed African Soil of the decision “to terminate the contract owing to non-compliance with the terms of the contract”.
Fritz said in an answering affidavit that Khalaf bought a controlling interest in the Hilton and “several motor vehicles for its business”.
He denied that Khalaf had any hidden interest in the agreement with African Soil being stopped.
He said that African Soil did transport Khalaf in November 2017 using a hired Lexus vehicle because African Soil had not yet obtained the required Mercedes-Benz E class.
Fritz said the allegations that Khalaf was not impressed with a female driver were concerning because Papadakis was not even the driver and therefore she was not there.
He also said: “His Excellency does not speak to anyone aside from his personal aide.”
Fritz said it would be odd if Khalaf was not impressed to deal with women because the hotel’s attorney in the current litigation was a woman.
He denied that he had said the agreement would not be cancelled for “small matters”. He said African Soil also signed the amended draft contract without protest.
According to Fritz, some hotel guests had complained about the transport service and “not once did the applicant contend that the complaints were fictitious or had been fabricated”.
He said that two weeks after the contract had commenced, African Soil still did not have the full fleet of five vehicles required.
Fritz said the interdict should fail.
He said the contract had been lawfully terminated and even if it was not, the service was not exclusive to African Soil and Hilton was within its rights to give business to third parties.
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