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[2016] ZAWCHC 6
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Myburgh v Equestrian Valley (Pty) Ltd (15986/2012) [2016] ZAWCHC 6 (4 February 2016)
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IN THE HIGH COURT OF
SOUTH AFRICA
(WESTERN CAPE DIVISION,
CAPE TOWN)
Case No: 15986/2012
DATE: 04 FEBRUARY 2016
In the matter between:
DANIE PIETER
MYBURGH
.....................................................................................................
Plaintiff
And
EQUESTRIAN VALLEY (PTY)
LTD
....................................................................................
Defendant
JUDGMENT
DELIVERED ON 04 FEBRUARY 2016
RILEY, AJ
[1] In and during the beginning of 2006
the plaintiff became aware through his attorney and friend that plots
were available to
be purchased in the Hunters Valley Equestrian
Residential Estate (‘Hunters Valley’). Hunters Valley is
situated in
the Swartland, fifty kilometres from Cape Town and a mere
thirty minutes along the N7 described as an exclusive new equestrian
residential estate, comprising of twenty four separate title
residential erven of approximately 11,000 sq. m (1 Ha) each.
According
to a brochure prepared by estate agents, Ridsdale &
Associates who were responsible for marketing and the sale of the
plots
at Hunters Valley, the development is aimed at not only those
who ride the hunt or own and wish to stable horses, but anyone who
would like to enjoy a country lifestyle with the added benefit of
being in an equestrian environment.
[2] The brochure further states that
purchasers are to commence building their own ‘werf’ and
homestead and ancillary
buildings within two years of purchase of the
property according to the needs and assembly of the purchaser. In
addition, the
brochure states, inter alia that residents at Hunters
Valley will have overriding rights in perpetuity over the remainder
of the
farm in terms of their title deeds, that additional facilities
to be provided, would include a new stable block to be built in the
near future with stables offered for sale or to rent, livery services
will be offered and that the owners of the farm, Rondeberg,
have
allocated a budget to restore the original homestead and adjoining
barn as a restaurant and ‘clubhouse’ facility.
[3] On 17 August 2012 plaintiff issued
summons against the defendant based on a material breach by the
defendant of an essential
term of two agreements relating to the sale
of portions 18 and 19. Plaintiff avers inter alia that:
1. In terms of clause 19 of the sale of
agreements, the parties expressly agreed and the defendant warranted
that the equestrian
facilities proposed viz stables, dressage,
cross-country and show jumping will be developed according to a site
development plan;
2. That it was an implied term of the
agreements that the equestrian facilities would be installed on a
permanent basis within a
reasonable time after registration of
transfer of the properties into the name of the plaintiff;
3. That clause 19 and the implied term
referred to hereinbefore were material terms of the sale agreements
and that despite the
expiry of a reasonable time and despite demand,
defendant has failed to install the equestrian facilities on a
permanent basis;
4. That defendant’s failure as
aforesaid amounted to a breach of the sale agreements and that due to
the breach; the plaintiff
cancelled the sale agreements and or
alternatively cancelled them by issuing the summons.
5. That due to the defendants breach of
the contract, plaintiff has suffered damages amounting to R588 440-14
in respect of inter
alia, transfer costs, bond registration costs,
service fees and interest component in respect of the loans made by
plaintiff; costs
of the cancellation and the levies paid by plaintiff
to the Home Owners Association;
6. Plaintiff tenders to transfer the
properties back to defendant at the defendants costs against
repayment of the purchase price
plus interest thereon;
7. In the alternative and should the
court find that the plaintiff was not entitled to cancel the sale
agreements, plaintiff avers
inter alia that:
7.1 He is entitled to an order
directing the defendant to permanently install the equestrian
facilities within a reasonable time
after the service of the summons;
7.2 If the defendant has not installed
the equestrian facilities within a reasonable time after service of
the summons and particulars
of claim, the plaintiff will become
entitled to cancel the agreements by written notice to the defendant;
7.3 That the reasonable time referred
to hereinbefore will have expired within six months of receipt of the
summons alternatively
within such time as the court may direct.
[4] In its plea defendant avers inter
alia that –
1. Plaintiff’s claim should be
dismissed as plaintiff did not commence the building of the dwellings
and permissible out-buildings
on the properties purchased by him
within the two years from the date of registration of transfer
namely, 20 August 2009, nor did
it complete the building thereof
within one year from such commencement;
2. That as a result of plaintiffs’
failure to meet the obligations referred to in the preceding
paragraph, defendant was not
obliged to perform as claimed by
plaintiff;
3. Defendant further denies that
plaintiff had lawfully cancelled the sale agreements or that
plaintiff is entitled to cancel the
agreements and that the
plaintiffs’ purported cancellation of the agreements amounted
to a unilateral repudiation, which
repudiation defendant elected not
to accept.
[5] In plaintiff’s replication he
admits that he had not complied with the undertaking to commence
building within two years
from the date of registration of transfer
and that he did not complete the building within one year from the
date of commencement
of the building works, (clause 16.3), but denies
that defendant was entitled to withhold its obligations to develop
the equestrian
facilities, viz stables, dressage, cross-country and
show jumping according to a site development plan (in terms of clause
19),
alternatively that he is not obliged to comply with clause 16.3,
unless and until the defendant has complied with his obligations
as
set out in clause 19.
[6] Considering the developments in the
trial of this matter, I deem it necessary to mention the following at
this stage:
1. On 4 February 2013 plaintiff’s
attorneys stated inter alia in the Rule 37 questionnaire that at that
stage there was no
intention to amend the pleadings nor did it intend
to call expert evidence. It was estimated that the trial was
estimated to take
three days to complete;
2. On the same day the matter was
placed on the continuous roll;
3. On 25 April 2014 the parties were
given notice of the Rule 37(8) conference which was set down for 13
May 2014;
4. According to the compliance
certificate filed on 13 October 2014 a pre-trial was held before
Veldhuizen J on 13 May 2014 and
postponed to 26 August 2014 and the
matter was marked trial ready;
5. On 15 October 2014 after the final
pre-trial, Veldhuizen J found that the matter is trial ready;
6. On 29 October 2014 the matter was
set down for hearing on 11 February 2015.
7. The trial commenced on 11 February
2015 on the understanding that the parties were of the view that it
would be concluded in
two days;
8. During the course of the trial, and
after plaintiff had already commenced adducing evidence, I was
advised on 16 March 2015 that
the plaintiff had consulted an expert
who was to testify at the trial. Needless to say, this resulted in
the defendant also deciding
to call its own expert witness.
[7] I mention these aspects as neither
of the parties made any mention of calling expert witnesses before
pleadings were closed
nor after the matter was declared trial ready
and even before the commencement of the trial.
[8] In addition, the plaintiff brought
an application to amend its particulars of claim after the trial had
already commenced.
As will appear later herein the application to
amend is opposed by the defendant. I deal with the issue of the
amendment sought
by the plaintiff later on in this judgment. I pause
to mention that whilst I was in the process of considering judgment
in this
matter, and on 22 January 2016, plaintiff served a further
notice in terms of Rule 28 on defendant in which it sought to amend
the amount claimed in paragraph 12 and prayer D to its particulars of
claim from R588 440-04 to R686 790-75. The purpose of the
amendment
was to bring the interest accrued to the capital amount claimed by
plaintiff up to date as at the time of the judgment.
At a meeting
held with counsel for both parties on 1 February 2016, counsel for
the defendant advised that defendant would not
be objecting to the
amendment sought. No doubt these developments and the manner in
which the parties conducted the matter resulted
in a situation where
a trial which was estimated to last for two days was drawn out over a
lengthy period of time.
[9] I now turn to deal with plaintiff’s
application to amend his particulars of claim. On 6 March 2015 and
after the trial
had commenced the plaintiff delivered a notice of his
intention to amend his particulars of claim. The purpose of the
amendment
was to introduce an alternative cause of action based on
repudiation in addition to the existing cause of action based on
breach
and cancellation.
[10] On 11 March the defendant
delivered a notice objecting to the amendment. Defendant complained
inter alia that the proposed
amendment lacked sufficient
particularity in that it did not specify what acts by the defendant
amounted to the repudiation. In
addition defendant complained that
plaintiff has failed to state when and how the repudiation was
accepted by the plaintiff.
[11] On 12 March plaintiff delivered a
notice of motion and affidavit in support of an application for leave
to amend his particulars
of claim in accordance with the notice in
terms of Rule 28(1).
[12] On 16 March 2015 I heard argument
on the application for leave to amend and advised the parties that I
was inclined to order
that the particularity sought by the defendant
be provided but I nevertheless prevailed on the parties to attempt to
resolve the
matter between themselves. The trial was in the interim
to continue.
[13] On 19 March 2015 the plaintiff
delivered a new notice in terms of Rule 28(1) in which he avers that
he had provided the particularity
sought by the defendant. Defendant
was clearly not in agreement and on 2 April 2015 defendant delivered
a notice of objection.
The notice of objection was similar to the
objection raised to the plaintiff’s first notice of intention
to amend. In essence,
defendant’s objection is that the
amendment by plaintiff seeks to introduce a cause of action that did
not exist at the time
the summons was issued.
[14] On a consideration of the notice
of intention to amend, the amendment appears to seek to include the
assertion that the plaintiff
accepted the defendant’s
repudiation of the agreements on 16 August 2012 by the sending of a
letter of cancellation alternatively
that ‘… the
plaintiff hereby accepts the repudiation’.
[15] Mr Baguley who appeared for the
plaintiff submitted that the defendant will not suffer any prejudice
should the amendment be
granted as the plaintiff’s repudiation
case rests on exactly the same facts as the breach of contract case
and in his view
no new evidence would be required.
[16] The general principles applicable
to amendments sought during the course of a trial is succinctly
summarised at para [34] in
Randa v Radopile Projects CC
2012 (6) SA
128
(GSJ) and are as follows:
16.1 The court has a discretion whether
to grant or refuse an amendment;
16.2 An amendment cannot be granted for
the mere asking; some explanation must be offered therefor;
16.3 The applicant must show that prima
facie, the amendment has something deserving of consideration, i.e. a
triable issue;
16.4 The modern tendency lies in favour
of the grant of an amendment if such facilitates the proper
ventilation of the dispute between
the parties;
16.5 The party seeking the amendment
must not be mala fide;
16.6 The amendment must not ‘cause
an injustice’ to the other side which cannot be compensated by
a cost order;
16.7 The amendment should not be
refused simply to punish the applicant for neglect;
16.8 A mere loss of [the opportunity of
gaining] time is no reason in itself for refusing the application;
16.9 If the amendment is not sought
timeously, some reason must be given for the delay.
[17] It is accepted law that ‘a
litigant who seeks to add new grounds of relief at the eleventh hour
does not claim such an
amendment as a matter of right but rather
seeks an indulgence’. See Erasmus, Superior Court Practice (RS
40, 2012 B1 –
183). It is also clear from the authorities that
except in special or exceptional circumstances a summons may not be
amended so
as to include a cause of action not existing at the time
of its issue. See Erasmus supra RS45, 2014 p. B1 – 180). It
is
also so that a plaintiff who relies on repudiation must inter alia
allege and prove ‘an election by the innocent party to
terminate and communication of the election to the guilty party’.
See Amler supra 7 ed. at p.340.
[18] It is further accepted law that a
failure to plead the facta probanda for a cause of action will
generally render a pleading
excipiable; particularly in circumstances
where a defendant is not allowed sufficient time to obtain further
particularity, and
will generally not be allowed. In
Trans-Drakensberg Bank Ltd (Under Judicial Management) v Combined
Engineering (Pty) Ltd and
Another
1967 (3) SA 632
(D), Caney J held
that a party ‘… cannot … save perhaps in
exceptional circumstances, introduce an amendment
which would make
the pleading excipiable (Cross v Ferreira, supra at p. 450), or
deliberately refrain until a late stage from bringing
forward his
amendment with the purpose of catching B his opponent unawares
(Florence Soap and Chemical Works (Pty) Ltd v Ozen Wholesalers
(Pty)
Ltd
1954 (3) SA 945
(T)) or of obtaining a tactical advantage or of
avoiding a special order as to costs (Middleton v Carr,
1949 (2) SA
374
(AD) at p. 386).”
[19] I accept that delay, on its own,
is generally not a bar to an amendment. The plaintiff has however
provided no reasonable
explanation why this new cause of action was
not originally pleaded when action was instituted nor has the
plaintiff explained
why the amendment was not sought before the close
of pleadings. The plaintiff in fact brought the application for the
amendment
a week before the continuation of the trial which was
postponed on 12 February 2015. In my view the plaintiff must at the
least
have been aware of the need for the amendment since at least 11
February 2015 when his evidence was led. It is necessary to note
in
this regard that in paragraph 6.2 of his founding affidavit the
plaintiff states that the evidence regarding his acceptance
of the
defendant’s alleged repudiation can be discerned from the
evidence already led.
[20] On a consideration of the issues
in dispute between the parties in this matter, I am satisfied that
the amendment which plaintiff
seeks will introduce a new cause of
action which did not exist at the time of the issue of summons.
Plaintiff has not made any
effort to identify and/or to present to
the court special or exceptional circumstances upon which it relies
to persuade the court
to exercise its discretion in his favour.
Plaintiff has as much conceded that the amendment will be refused if
he seeks to introduce
a cause of action which has prescribed. On a
consideration of the facts, I am satisfied that the defendant will be
prejudiced
should the amendment be allowed as defendant will find
itself in a position where it does not know what case it is required
to
meet and will only hear in argument for the first time what
defendants alleged repudiation is, when it occurred, and when it was
allegedly accepted. In my view the effect of the amendment will
further result in a situation where the defendant will have been
caught ‘unawares’ and will create situation where the
plaintiff will obtain a tactical advantage over the defendant
which
will result in defendant being prejudiced. On the whole and guided
by the authorities hereinbefore referred to I am not
prepared to
exercise my discretion in favour of granting the amendment as sought.
The application accordingly falls to be dismissed.
[21] It is common cause that on 25 May
2006 plaintiff purchased portions 18 and 19 from the defendant and
purchased a third plot
from a third party during February 2007. The
material terms of the sale agreements in relation to portions 18 and
19 are not in
dispute and can be summarised as follows:
1. The defendant would give transfer of
the portions (‘plots’) to the plaintiff which would
entail attending to the
sub-division of the plots which in turn would
require compliance with the statutory compliance of the requirements
as set out by
the relevant local and or government authorities;
2. Defendant would ensure that all the
infrastructural services were installed;
3. A Home Owners Association would be
established;
4. Plaintiff and his successors in
title were granted a perpetual right for equestrian purposes over the
Rondeberg Farm;
5. The plaintiff would pay the full
purchase price on transfer of the portions in his name;
6. Plaintiff would complete building in
accordance with the prescribed architectural guidelines by no later
than two years after
transfer of the portions in his name.
7. The plaintiff would become a member
of the Home Owners Association and would pay the concomitant levies
due in this regard.
[22] In respect of portion 19, two
special conditions were included in writing in the agreement which
are that ‘…the
equestrian facilities proposed, viz
stables, dressage, cross-country and show jumping arena will be
developed according to the
site development plan’. In the
other sale agreement plaintiff was afforded the right to purchase
additional plots in any
second residential phase of Hunters Valley.
Plaintiff took transfer of portions 18 and 19 on 20 August 2009. It
is not in dispute
that the delay in having the plots transferred and
registered into defendants name was inter alia as a result of
difficulties encountered
from the government and/or local authorities
in obtaining approvals or compliance with their requirements.
[23] In my view the crucial issues to
be determined is whether or not the plaintiff was entitled to cancel
the sale agreements referred
to hereinbefore and in particular
whether the defendant had breached the agreement by failing to
perform, which would include whether
or not the obligation to provide
the equestrian facilities was due, whether or not defendant had been
placed in mora, whether or
not the plaintiff had the right to cancel
the agreements and whether plaintiff had given proper notice.
[24] Plaintiff testified at the trial
and called Katherine Anne Mary Stofberg, Paulene Anne Doo and Wayne
David Thurgood to testify
in support of his case. The defendant
called Frederick David Bryant (“Bryant”), Carol Claassen,
Dr Cordeux Vere Hubert
Allen (“Dr Vere Allin”), Danielle
Pienaar and Dr Willem Sternberg Pretorius (“Pretorius”)
to testify on
its behalf. I mention at the outset that I do not
intend to repeat the whole of the evidence of the respective
witnesses and shall
refer to the evidence of the witnesses in so far
as I deem it necessary to determine the issues.
[25] It is necessary to point out at
this stage that the constitution of Hunters Valley Equestrian Centre
and Residential Estate
provide that the home owners are required to
form an association known as the Hunters Valley Homeowners
Association (“HVHOA”),
which has an object to regulate
and control all aspects of the development, the buildings and
structures erected or to be erected
on the units, the maintenance
thereof and the promotion, advancement and protection of the communal
and group interest of the members
generally upon the terms and
conditions as set out in the constitution.
[26] In terms of clause 6 of the
constitution the trustee committee shall from time to time make
levies upon the members for the
purpose of meeting the expenses which
the association may incur in obligations under the constitution.
Clause 6.2 provides inter
alia that the committee shall estimate the
amount which shall be required by the HVHOA to meet its expenses
during each year together
with such estimated deficiency, if any, as
shall result from the preceding year and shall make a levy upon the
members equal as
nearly as is reasonably practical to such estimated
amount. In terms of clause 6.2 such levy shall be made payable by
equal monthly
instalments due in advance on the first day of each and
every succeeding month of such year.
[27] Section 6.3 provides that any
amount due by a member by way of a levy shall be due by him to the
association.
[28] Clause 11.1 of the constitution
provides that in the event of any member and the trustee committee of
the HVHOA being unable
to resolve a difference or dispute amicably;
such member or trustee committee shall be entitled to request in
writing that an attempt
be made to resolve the difference by way of
mediation. The mediator shall be the nominee of the President for
the time being of
the Law Society of the Cape of Good Hope.
[29] Clause 12 of the constitution
provides inter alia that any dispute, question or difference arising
at any time between a member
and the trust committee out of or in
regard to:
‘12.1 ….
12.1 the regulations made by the
trustee committee; or
12.2 a difference or dispute which
could not be settled by way of mediation; shall be submitted to
Arbitration by an Arbitrator
appointed by the President for the time
being of the Law Society of the Cape of Good Hope.’
[30] Notwithstanding the aforesaid
provisions it is common cause that at no stage after the registration
and transfer of portions
18 and 19 into plaintiff’s name, did
plaintiff at any time request that any of the disputes that he may
have had with the
defendant or the HVHOA be referred to either
mediation or arbitration.
[31] Considering the issues involved, I
deem it necessary to highlight certain facts and/or events as they
occurred chronologically
after plaintiff signed the offer to purchase
and the registration and transfer of portions 18 and 19 into his
name.
[32] On 7 February 2007 Carol Claassen,
the representative of the estate agents, Ridsdale & Associates,
forwarded to the plaintiff
an answer to an email, in which plaintiff
asks ‘what still needs to be done before transfer?’ The
response thereto
was prepared by Bryant a representative of the
defendant and also a trustee of the HVHOA. In his response Bryant
states inter
alia that ‘… we are required to have the
perimeter fenced before the final10% of the properties are
transferred, however
we will commission this during March.’ In
the same email in regard to the question regarding ‘Main Farm
House Restoration,
Stables and Clubhouse – when is that all
happening – before or how long after transfer. When is it
expected to be
finished?’ Bryant responded as follows:
‘Again both these fall within the
10% ruling (Main House and Stables that is). I am not aware of any
plans to build a clubhouse.
A firm of architects, (Rennie Scurr
Adendorf) who are experts in the restoration of old buildings around
the Cape have been commissioned
to do a study and to revert with
recommendations …. This report is imminent, however, we don’t
anticipate commencing
with these activities until the first tranch
(potentially 21 properties) have been transferred …’
[33] On 10 August 2007 Alida Ridsdale
of Ridsdale & Associates addressed an email to plaintiff
regarding the status and progress
of the Rondeberg sewage treatment
works together with a copy of the minutes of the meeting of the
Hunters Valley Shareholders and
professionals.
[34] On 2 August 2007 a meeting of the
Hunters Valley Shareholders took place to establish the position
regarding the sewerage system
at Rondeberg and to decide on actions
and responsibilities in order to gain the required approvals or
compliance with the relevant
local and other government authorities.
On 10 August 2007 the plaintiff was sent a copy of the minutes of
this meeting via email.
[35] On 22 October 2007 the plaintiff
emailed Bryant and wanted ‘any indication when transfer is
suspected (sic) going to
take place?’
[36] On the same day Bryant responded
by email and advised that ‘we have been pushing very hard over
the past two months or
so; and have a further engineer who has a good
relationship with DWAF to see the approval through. We have made
significant progress
in this period and I wish I could give you a
firm date. However what is clear is that personalities and egos are
involved and
we are being made to pay for it! We are hoping to get
this through before year end’.
[37] On 15 May 2008 Sanette Van Vuuren
(“Van Vuuren”) of the transferring attorneys, Bornman and
Hayward emailed plaintiff
and advised him that the transfer documents
were ready for signature. On the same day plaintiff responded by
stating that he was
in the middle of nowhere and that he would go to
Louis Trichardt to sign off the documents at a representative whom he
had selected.
[38] In a further email from plaintiff
to Van Vuuren on the same date, he draws her attention to the fact
that he has a clause in
two of the three contracts that states that
the developer must show the intent of developing the project as the
marketing has pictured
it. Plaintiff wanted to know whether this had
been attended to.
[39] On 21 August 2009 plaintiff was
informed by Van Vuuren in writing that the registration in respect of
portion 19 had taken
place. On 3 September 2009 Van Vuuren emailed
plaintiff proof that registration and transfer had taken place on 20
August 2009
in respect of portion 18.
[40] On 2 October 2009 an email was
sent by Bryant to plaintiff and the other property owners at Hunters
Valley inviting them to
the inaugural meeting of the HVHOA to be held
on 14 October 2009.
[41] On the agenda for discussion is
inter alia the constitution of the HVHOA and the completion of the
remaining development items.
It is common cause that plaintiff did
not respond to this email nor did he attend the meeting. According
to plaintiff he was
working in Botswana at the time and he only had
intermittent access to email, once or twice a month.
[42] On 6 October 2009 Bryant sent
plaintiff an email to which was attached the constitution of the
HVHOA as well as the servitudes
registered over the farm. In this
email plaintiff was advised that the constitution of the HVHOA sets
out the details and responsibilities
of the HVHOA and the appointment
of trustees and other individuals.Plaintiff did not respond to this
email.
[43] On 14 October 2009 the inaugural
meeting of the HVHOA took place. As appears from the minutes of this
meeting, which is not
disputed, Bryant ‘updated the meeting on
progress and outstanding items at site, as well as the sales and
registration of
the properties’. According to his report,
thirteen properties had been registered at that date, five of which
went to the
original developers. ‘… A further four
properties requiring confirmation from the purchasers. There are
therefore
four unsold properties which have been handed back to
Ridsdale and Associates for sale’. At the meeting there was
also discussion
in relation to the completion of remaining
development items which was addressed by one of the representatives
of the defendant.
It is common cause that plaintiff did not attend
this meeting nor did he send a representative. Plaintiff further did
not request
that any of the issues which are the subject matter of
the dispute in this matter, be tabled for discussion.
[44] On 2 December 2009 Bryant sent an
email to plaintiff enclosing the minutes of the HVHOA meeting of 14
October 2009. Plaintiff
did not respond to this email.
[45] On 30 March 2010 Bryant addressed
an email to plaintiff and the other members of the HVHOA giving
notice of the Annual General
Meeting (“AGM”) of the HVHOA
which was to be held on 20 April 2010. The agenda, which was
included in the notice,
included items such as property sales, barn
house and stabling requirements in new barn. Members were invited to
forward to Bryant
any issue that they would like included and or
added to the agenda. The plaintiff did not provide any comment nor
did he request
that any issue be included or added to the agenda.
[46] At the AGM of the HVHOA on 20
April 2010 the minutes reflect that the following issues inter alia
were discussed:
‘9.Horse barn, Karin Watling had
brochures from Rolf Knittel to investigate. There was no indication
who required stables.
A circular to go out to all owners requesting
this info. (D Bryant)
10. Dressage area. Karin suggested
that Kobus Conradie could advise. Vere Allin mentioned what other
local residents are doing
…’
[47] It is common cause that plaintiff
did not attend this meeting. According to him, he was out of the
country at the time. On
28 April 2010 an email was sent to plaintiff
enclosing the minutes of the meeting of 20 April 2010. He did not
respond to this
email.
[48] On the evidence it is clear that
the plaintiff had raised no objection with the defendant or the HVHOA
in regard to the issues
in dispute in the present matter. When he
testified, plaintiff explained that his failure to do anything up
until this stage was
due to the fact that he was involved in a big
project in Botswana and thereafter in the Congo which kept him busy.
He also testified
that considering the area and the harsh conditions
that he worked under, he was not always in a position to respond to
emails.
I must immediately point out that I am not persuaded by the
explanations given by plaintiff in this regard. Even though he may
not have always been in a position to respond to emails immediately,
it was not completely impossible for him to do so. There
was also no
reason why he could not have briefed his wife and/or his friend and
attorney of record, to deal with these issues in
his absence
considering how close these issues were to his heart.
[49] On 5 October 2010 the plaintiff
addressed an email to Bryant in which he simply states: ‘No
more levies will be paid
by me until the development of this project
are being completed as promised and special clauses in the contract
that states that
developers must develop the equestrian centre,
dressage are met. My trust in the developers for doing what they
said has come
to a grounding halt. Seeing that I invested into 10%
of this initiative my concern is that I have been taken for a ride
second
to none. I have paid R3000.00 every month on levies for one
full year. What do I have to show for it … three stands with
a tar road … no development in improving the barn facilities
etc. I will not commit one cent more to the project until
I see this
concept development and completed to what was provided’.
[50] On 6 October 2015 Bryant
acknowledged receipt of plaintiff’s email and undertook to
forward plaintiff’s email to
the directors of defendant and
thereafter revert to him.
[51] On 21 December 2010 Bryant
responded to the plaintiff and advised that the directors had
discussed his (i.e. plaintiff’s
position) and that they felt
that they should meet with him to hear what his concerns may be.
Bryant advised plaintiff that the
defendant’s directors would
still like to arrange the meeting early in the New Year.
[52] It is not in dispute that
plaintiff did not take up the offer of the meeting with the
defendant’s directors. What is
important is that in the same
email, Pretorius responds to plaintiff’s concerns as follows:
‘The intent of the developer to
provide equestrian facilities i.e. stables, dressage and show jumping
arenas, eventing courses
and outride areas on completion of the
project remains.
[Point 1]. It may be pointed out that
a temporary stabling facility is in operation and running smoothly
(there is, in fact, a
waiting list to get in). In addition, the
existing facilities, namely eventing course and extensive outride
areas are being used
enthusiastically and successfully, as
demonstrated by recent 3 phase event and Hunter trials. Endurance
riders, of which some
are national riders who regularly compete in
World Championships, are also utilising the outride areas for
training, and regard
it as the best in the country. As the owner of
two properties, I certainly share Mr Myburgh’s disappointment
in the rate
of progress to completion of the project. The economic
downturn, and difficulties encountered with state departments were,
however
beyond the control of the developers; and my opinion is that
they performed better than could be expected in the circumstances.
The speculative purchase of properties with its attendant risks is of
course entirely the choice of the purchaser.
I am in no position to comment on the
alleged misrepresentations by the selling agent as I was not present
at their discussions.
As for the non-payment of levies to the HOA
are concerned, this is a matter for the trustees to manage according
to the constitution
of which Mr Myburgh has a copy, and undertook to
abide by …’ (my emphasis)
[53] It appears that even though the
idea was that defendant’s directors would contact plaintiff
early in the New Year to
set up an appointment to discuss the
plaintiffs concerns, this did not happen. Plaintiff himself did not
call for a meeting with
defendant’s directors.
[54] On 17 April 2011 and seemingly in
response to the email from Bryant (and the comments of Pretorius),
plaintiff addressed an
email to Bryant in which he asked him to ask
Pretorius to explain how his investment of his three plots are
protected and how ‘Point
1 is going to be achieved seeing the
company Hunters Valley doing the investment, has apparently being
deregistered by Cipro’.
[55] On 18 April 2011 plaintiff
addressed a further email to Bryant which was also forwarded to
Pretorius, Dr Vere Allin and Gavin
Watson of the defendant. In this
email plaintiff states inter alia that ‘Bottom line a (sic)
invested nearly two million
rand in these three plots, and I need to
know how the developers is going to give me reassurance on the
re-sell value of this investment’.
What is abundantly clear
from the tenor of the plaintiff’s later emails is that since he
believed that he had invested heavily
in Hunters Valley Equestrian
Residential Estate, that he wanted the defendant to provide him with
guarantees and/or as he put it,
reassurance on the ‘re-sell
value of this investment’. What is telling that plaintiff does
not request to meet with
the defendant and/or its representatives to
discuss his concerns.
[56] Plaintiff testified that at the
beginning of 2012 he engaged the services of a Pretoria law firm
Markram for advice. What
is clear is that although he allegedly
instructed Markram to ‘get hold of the site development plan’
that Markram did
not do anything, nor did plaintiff follow up and or
pursue the issue through them in any way.
[57] On 25 April 2012 the AGM of the
HVHOA took place. Plaintiff did not attend this meeting. His excuse
for not attending the
meeting is that he was not in Cape Town. It is
necessary to note that plaintiff did not request that any of the
issues raised
by him in his correspondence to defendant at that time,
be placed on the agenda. According to the emails which were sent to
the
plaintiff, issues discussed, related inter alia, to the fact that
the Cape Hunt and Polo Club (‘CHPC’) had been dissolved
and that the jumps, stands and other equipment would be moved to the
farm and that from ‘the kitty’ of the
disbanding/liquidation
of the CHPC, those funds would be used to
build a dressage arena. This was subject to finalisation. The
budget of the HVHOA was
tabled and it was agreed that the levy was to
remain increased to R1 150-00 (15%), and that water charges would be
levied with
immediate effect. It was recorded that the HVHOA had the
right to increase the levies by a factor of three if no buildings
have
been built after a two year period. It was further agreed that
as the economic downturn was responsible for the lack of houses,
that
the increased levy would be inappropriate and that the position would
be reviewed annually.
[58] It is necessary to note that even
though the installation and/or building of a dressage area and issues
relating to rates featured
in the discussions and from the minutes,
plaintiff did not deem it necessary or important to address these
issues with defendant
or the HVHOA in correspondence. This is
important, particularly, since the minutes indicate that the dressage
arena issue is noted
as being subject to finalisation and that Dr
Vere Allin of the defendant was seized with the issue.
[59] On 5 November 2010 Bryant sent
plaintiff the HVHOA’s November levy. Plaintiff responded on
that same day by stating
that he ‘will start paying my levies
once again when and if the developers start developing the promised
end product as marketed
to me’.
[60] On 16 August 2012 plaintiffs’
attorney of record wrote to the defendant and stated inter alia that:
‘1. Our client purchased Portions
18 and 19 (a portion of portion 5) of the Farm [R………],
[Number 1……..]
in the Division Cape Town, in the City
of Cape Town from the company on 25 May 2006;
2. In terms of clause 19 of the sale
agreement it was agreed that the company warrants an acceptance of
the agreements that equestrian
facilities will be developed according
to the site development plan; and
3. Notwithstanding the expiry of
reasonable time and our clients demand the equestrian facilities have
not been developed, which
amounts to a breach of the sale agreements;
It is further our instructions to
inform you that due to the aforesaid breach our client hereby cancels
the sale agreements and
reserves his rights to claim damages arising
from the breach of agreements’.
[61] It is common cause that the sale
agreements do not stipulate a time for performance of the obligation
to develop the equestrian
facilities. Although clause 19(1) of the
agreements provides that ‘the seller warrants on acceptance of
this agreement that
the equestrian facilities proposed, viz stables,
dressage, cross-country and show jumping area will be developed
according to a
site Development Plan’ no evidence whatsoever
was presented by the plaintiff at the trial about what the Site
Development
Plan referred to in Clause 19(1) entailed nor was it
presented to the court.
[62] Mr Baguley submitted that in the
absence of a definite time specified for performance of the
defendant’s obligations
that this court is constrained to find
that it was an implied term of the agreement that the development of
the equestrian facilities
was to take place within a reasonable time
from the date of transfer of the properties to the plaintiff. He
further submitted
that the word ‘developed’ in Clause
19(1) can permit of no other meaning than that the facilities were to
be developed
permanently and that to the extent that the parties did
not expressly agree that the facilities would be permanent, it was
plainly
a tacit term of the agreement that it would be permanent.
[63] He however conceded that the
plaintiff was required to prove a material breach of an essential
term of the agreement, which
he accepted had to go to the root of the
contract i.e. a breach which is fundamental, vital or essential. He
submitted that the
development of the equestrian facilities goes to
the root of a contract for the sale of properties in an intended
equestrian estate.
He contended that without them, there are just
parcels of land, attractive to no one. According to him the lapse of
three years
between the date of transfer i.e. 20 August 2009, and the
alleged date of cancellation i.e. 16 August 2012 is a reasonable time
within which to have developed the equestrian facilities.
[64] He submitted that the defendant
has admitted that it did not develop the equestrian facilities in
accordance with Clause 19
and that at the time of the purported
cancellation of the agreements on 16 August 2012, the defendant had
exhibited an intention
not to perform all of the obligations in the
agreements according to their true tenor and consequently the
plaintiff was therefore
justified in thinking that the performance in
terms of Clause 19(1) will not be forthcoming.
[65] Mr Baguley contended that the word
‘developed’ in Clause 19(1), suggested that something
will be ‘built’.
He placed strong reliance on the
advertising brochure which was given to prospective purchasers which
refers to the estate as
‘exclusive’ that a new stable
block would be built, that the original homestead would be restored
and that the adjoining
barn would be converted to a restaurant and
clubhouse. He further placed reliance on an article which appeared
in Business Day
in 2004 about the estate in which Dr Vere Allin is
allegedly quoted as saying ‘our aim is to offer a world class
equestrian
facility, including arenas for show jumping, dressage and
enough space for cross country events’. Because of this he
contended
that the defendant has materially breached the agreement
and has repudiated them. He submitted that the plaintiff ought to be
put into the same position as he would have occupied had the
contracts not been entered into (i.e. so-called negative interest or
reliance interest).
[66] On a consideration of the evidence
as a whole I am satisfied that the majority of the witnesses
confirmed that the biggest
attraction and the major advantage of the
Hunters Valley Equestrian Estate are the overriding rights and
concomitant riding trails.
In this regard Bryant testified that
people buy in the estate to get out of the city, and from a horse
riding perspective, to
have a facility where they can exercise their
horses safely and the fact that they may use the over 550 hectares
farm. A further
major attraction, which is also pointed out in the
marketing brochure, and was highlighted in the evidence, is the huge
focus on
the hunt. On the evidence, hunter’s trials are held
annually on the estate and the existing cross-country track is used
for this event. There are between three to five ‘hunts’
held annually which are well attended. I am satisfied on the
evidence presented that what has been described as ‘the
material equestrian facilities’ on the estate were those that
have an affiliation to ‘the hunt’. Claasen testified
that this quality of the estate was pointed out to the plaintiff
when
she marketed the development to him and he understood this to be so.
Claasen testified that it was not specifically anticipated
that a
dressage arena and a show jumping arena would be built on the estate.
She testified that it was seen as part of an ‘equestrian
development adding onto what is existing there … it was –
you know, it was of the mention but not the foremost equestrian
event’.
[67] Although reference is made to, and
reliance is placed by plaintiff on the article in a Business Day
newspaper of 3 September
2004, plaintiff conceded during
cross-examination that what was contained in the article was not
promised to him. He further conceded
that what is contained in the
article is not contained in the agreement and that nowhere in the
agreements is reference made to
the facilities being permanent. I
am satisfied that the article in any event only came to the
plaintiff’s knowledge, and/or
was obtained in January 2015, in
preparation of the trial. On a consideration of the pleadings, I am
satisfied that no reference
is made to this Business Day newspaper
article and more importantly there is also no reference to what is
contained in the article,
if compared with what is contained in the
sale agreements.
[68]It is also instructive that no
reference whatsoever is made to the article or its contents in any of
the correspondence addressed
by the plaintiff to the defendant,
except that reference is made to the ‘Marketing brochure’.
With regard to the reference
or reliance by plaintiff, on ‘a
world class equestrian facility’ as referred to in the
newspaper article, it is necessary
to point out that no reference is
made to such facilities in plaintiff’s particulars of claim.
At most reference is made
to proposed ‘permanent’
equestrian facilities.
[69] On a consideration of the evidence
it is clear that the defendant’s witnesses, Bryant and Dr Vere
Allin had not seen
the article prior to these proceedings. In
respect of the alleged references in the article that “Our
ultimate aim is to
offer a world class equestrian facility including
arenas for show jumping, dressage and enough space for cross-country
events …
[and] that additional stables are being built’,
Dr Vere Allin testified that there are existing stables on the farm
and that
stables are not being built. He testified that he did not
remember saying what was contained in the article but that it was
certainly
his ‘… dream to have a facility or equestrian
facilities that will be, as good as any in South Africa’.
[70] I am satisfied on the evidence
that Dr Vere Allin and Bryant drew clear distinctions between the
‘upmarket‘ residential
estate (as referred to in the
brochure) and the equestrian facilities available on the estate,
which was clearly, predominantly
aimed at - ‘the hunt’.
Bryant was prepared to concede that if one was ‘talking about
an upmarket equestrian
estate where show jumping and dressage - you
are trying to attract the show jumpers and dressage, then it is not
adequate, …’
[71] When it was put to Dr Vere Allin
in cross-examination, with reference to the photographs of the show
jumping arena, that given
the nature of the development; its quality,
its world class character, its upmarket feel, approach ‘…
that what you
see in this picture is not what you would expect from a
development like … for a show jumping arena’, he was of
the
view that the upmarket development refers to Hunters Valley with
twenty-four plots on it, the riding trails and the cross-country
course, which is something that few equestrian estates actually have.
He did not exclude the possibility that three phase eventing,
i.e.
including dressage and show jumping could be achieved on the estate.
[72] It is not unreasonable to conclude
that the introduction by plaintiff of the obligation on the part of
the defendant to develop
a ‘world class’ and/or
‘upmarket’ equestrian facilities is an opportunistic
afterthought, after consideration
of the article in the Business Day
newspaper in preparation of the proceedings. Accordingly, I am not
prepared to place any reliance
on the content of the Business Day
article in determining the contractual obligations of the parties and
more particularly, in
so far as reliance is placed thereon to make a
determination on the quality of the equestrian facilities which
defendant is required
to provide in terms of clause 19 of the sale
agreements.
[73] I am satisfied that neither Bryant
nor Dr Vere Allin had any contact with the plaintiff prior to the
conclusion of the sale
agreement and that they did not make any
promises to him before he signed the agreements with regard to the
proposed equestrian
facilities and in particular in respect of the
quality of the proposed facilities.
[74] On the evidence presented at the
trial, I am further satisfied that the following facilities and
improvements were in existence
at the time when the plaintiff
purported to cancel the agreement and/or issued summons:
1. the extensive out-riding trails for
the purposes of the Hunt, trail and endurance riding (the rights
which have been secured,
in perpetuity, by the members of Hunter’s
Valley over the 500ha farm known as Rondeberg);
2. the existing stables;
3. the development of a cross-country
course (during 2008 or 2009); and, less significantly;
4. the levelling of veld/farmland (with
a grader) for an arena which was done in 2010;
5. the planting of beef-wood trees to
demarcate the arenas;
6. the obtaining of equipment for use
in dressage and show jumping (some from the Cape Hunt and Polo Club
which was dissolved prior
to 25 April 2012 and that the equipment was
moved to the Rondeberg farm).
[75] I do not deem it necessary for the
purposes of this judgment to repeat the whole of the evidence of the
expert witnesses who
testified at the trial. I shall refer to
certain aspects of their evidence to the extent that they may be
relevant. According
to the evidence of Danielle Pienaar (“Pienaar”),
defendant’s expert witness, the show jumping and dressage
facilities
which she inspected at Hunters Valley are arenas that she
would rate as 2.5 stars out of 5 on her personal rating system that
she
had developed over the years. She considered them safe and
suitable for low level training. The plaintiff’s expert,
Thurgood,
agreed that the arenas was suitable for low level training
(i.e. dressage and jumps of up to 1 metre). He further conceded that
he did not attend the site and inspect it, and that he expressed his
opinion based on the photographs that were used at the trial.
According to him “the arenas concerned did not qualify as
arenas and he described them as ‘… nothing more
than
jumps in an open veld … the ground is uneven … there
are … dips, molehills and rocks … [which]
will cause a
horse to break a leg …’ Pienaar, who had inspected the
arenas differed from him in this regard and was
adamant when
cross-examined that the arenas concerned, qualified as arenas for low
level training. She also did not regard the
arenas as dangerous for
horses in the event of low level training. According to Thurgood’s
expert report the arenas could
be installed at a ‘modest cost’
‘possibly’ two hundred and fifty thousand rand (R250
000-00). When cross-examined,
he however testified that it could be
built at a cost of R50 000-00. Even though the experts differed about
whether or not the
areas concerned were arenas or not they agreed
that the show jumping and dressage arenas provided, allowed for low
level training
of horses in those disciplines. What is further clear
from their evidence is that the building of show jumping and dressage
facilities
would depend on the client’s specific needs and
requirements.
[76] On the whole the evidence
presented by the defendant, which was not disputed by the plaintiff
in a meaningful way, shows that
the stables were in place and in use,
that arenas have been developed (albeit for low level training); are
available and are being
used by a number of persons including home
owners and visitors of Hunters Valley. On the evidence there has
been no request for
additional stables and although the plaintiff was
at liberty to put in a request for stables he did not do so when
invited. What
is clear is that the defendants have always considered
the arenas to be a work in progress. In his evidence Bryant accepted
that
defendant was obliged to provide the facilities in terms of
Clause 19 but testified that he was not sure what facilities
plaintiff
had in mind when he requested them. According to Bryant’s
evidence the members were using the existing facilities and there
was
no general unhappiness with the level of the facilities and
specifically not the outriding facilities. What is clear is that
the
plaintiff and the defendant had completely different visions or
dreams about what the development of the equestrian facilities
at
Hunters Valley entailed.
[77] In respect of when the facilities
would be developed, the plaintiff testified that he always asked when
they (i.e. defendant)
would do it. According to him Bryant always
said that they were busy putting in facilities regarding the
residential services
and once that is completed they will go over
‘and finish the project as marked’. In this regard it is
the defendant’s
case, that although not contained in the
agreements, that it was understood and accepted by the parties that
it is obliged to ‘complete’
the development of the
stables and arenas (i.e. for show jumping and dressage purposes),
once the first tranche (i.e. 90%, or 21
of the 24 plots) have been
sold and transferred. This has been commonly referred to as the
so-called 10% rule. In this regard
Bryant testified that in his
estimation there was no specific date attached to the 10% ruling, but
that it was envisaged that once
90% of transfers of properties had
been taken, funding would be available and the defendant would then
proceed with the ‘outstanding
facilities’ such as the
dressage and show jumping facilities. The overwhelming evidence
supports the defendant’s version
that all the home owners were
aware of this and accepted this. This is borne out by the contents
of the email correspondence between
the representatives of the
defendant and the plaintiff. In this regard reference is made inter
alia, to the email sent by Bryant
to plaintiff on 7 February 2007 on
the day the latter purchased his third property; and the email by
Pretorius dated 20 December
2010 where he clearly states that the
intent of the developer to provide the equestrian facilities ‘i.e.
stables, dressage
and show jumping arena … On completion of
the project remains!’
[78] Pretorius also testified that once
the 22nd property was registered that the defendant would be obliged
to have these facilities
in place. The plaintiff confirmed that he
was aware of the 10% rule, but surprisingly, and notwithstanding
Bryant’s emails,
testified that to his understanding it did not
apply to the development of the stables or other equestrian
facilities. I am satisfied
that the overwhelming probabilities
favour the defendant’s version on the issue of when the
facilities would be developed
and/or completed. I agree with Mr
Cooper that in the absence of a fixed date in the agreements for the
completion of the ‘equestrian
facilities’, that it made
commercial sense, considering the particular circumstances of this
case, that the logical date
or time for the completion of the
proposed equestrian facilities would be no later than when defendants
had sold and transferred
90% of the sub-divided properties on the
estate. On the evidence this would be the time when the development
would be virtually
fully occupied and the defendant would also be in
a financial position to complete these facilities. It is necessary
to point
out that the plaintiff has presented no evidence regarding
what in his view would be considered a reasonable time. Plaintiff’s
version that the obligation contained in the contract had to be
fulfilled by May 2008 is highly unlikely, improbable and falls
to be
rejected.
[79] The plaintiff has conceded that he
did not give prior notice to the defendant of his intention to cancel
the agreements. He
testified that he had approached attorneys
Markram to assist him with the problems he was experiencing with
defendant. According
to him he was not informed by Markram that he
was required to give defendant prior notice of his intention to
cancel. If the plaintiff’s
version is to be believed, it is
difficult to accept that even though he did consult the attorneys,
that he did not instruct them
to cancel the agreement and/or at least
request them to give notice to the defendant to fulfil its
obligations in terms of the
agreement. His version that they did not
inform him what was required to be done is unlikely and does not make
sense. He further
does not explain why he failed to follow up the
issue with them after the initial instruction and/or what he did
thereafter.
[80] On consideration of the emails
sent by plaintiff to the conveyancing attorneys dated 19 May 2008;
and the emails to Mr Bryant
dated 5 October, 5 November 2010 in which
he states that he will not be paying his levies to the Hunters Valley
Home Owners Association,
and April 2011, I am satisfied that they do
not contain a demand for performance by defendant by a fixed date.
The emails further
make no mention of an intention to cancel the
agreements. On the contrary they rather show intent to remain bound
by the sale
agreements. Indications and/or conduct that illustrate
that plaintiff could not have considered the defendant’s
alleged
non-compliance with the sale agreements as material and that
he had by his conduct elected to abide by them, is evidenced by the
following:
1. His failure to respond at all to any
of the notices and minutes to meetings particularly where those
minutes or meetings related
specifically to the issues which now form
the subject matter of this dispute;
2. His failure to attend meetings and
particularly those where the proposed equestrian facilities were on
the agenda and were discussed;
3. The fact that Claasen testified that
plaintiff had spoken to her about his friend and attorney of record,
Langley, who had at
one point invested in the development but had
cancelled his purchase at Hunters Valley. According to her plaintiff
had told her
that ‘the idea was that he was hanging in on the
project and wanting to eventually sell … two of his units to
build
on the third one’;
4. Plaintiff could, or did not
previously consider the defendants alleged conduct to be a
repudiation of the contract, as this
claim was only introduced
belatedly in March 2015 after the trial had already commenced;
5. Even though plaintiff avers that the
defendant was obliged to perform by May 2008, he notwithstanding
this, took transfer of
all three properties on 20 August 2009 well
knowing that the obligations contained in Clause 19 had not been
complied with;
6. On being questioned by the court
about why he did not ask that the issues which are now in dispute
were not included on the agenda
and in particular the development of
the site and the equestrian facilities he testified that ‘…
I can’t tell
you that I was unhappy so yes I have to assume
that how they put it out in these emails is still the way that I saw
the project;
that the first year after transfer … …I
didn’t feel that I should query it and that I had no reason to
query
it at that stage’.
7. The plaintiff paid his levies from
the date of transfer until approximately October 2010 at which time
he stated that he would
no longer be paying levies. The plaintiff
does however not put the defendant to terms in the sense of demanding
performance by
a particular date. Nor does he mention an intention
to cancel the agreements in his email of 5 October 2010.
8. In his emails of 17 and 18 April
2011 he once again does not put the defendant to terms nor does he
mention an intention to cancel
but rather requires the defendant to
give him an assurance in regard, to as he put it, the ‘re-sell
value’ of his investment;
9. The plaintiff concedes that he
received the notice to attend a meeting held on 25 April 2012. It is
common cause that, as in
the case of other meetings, the issues which
were addressed related to the progress on the estate. Plaintiff did
however not respond
to these emails/notice, nor did he in the
alternative arrange for his wife and/or his attorney to attend the
meetings or arrange
for his attorney to address correspondence to the
defendant with regard to his complaints.
[81] The authorities are clear that
placing a party in mora by way of a valid demand and subsequent
breach is not sufficient to
entitle an innocent party to cancel the
contract. Something more is required i.e. the failure to perform
must be material and
this is the case when ‘time is of the
essence’. (i.e. where the plaintiff has given the defendant
notice of his intention
to cancel the agreement should he not perform
by a fixed date which is reasonable). In Birkenruth Estates (Pty)
Ltd v Unitrans
Motors (Pty) Ltd
2005 (3) SA 54(W)
at para 16, the
court held that ‘Mora in our law simply means breach. When it
comes to breach of a clause which provides
that a party “shall”
do something by a specified time, failure to do so would put the
party in mora ex re. No prior
demand or interpellation is required.
The general rule is that breach of contract through failure to
perform timeously gives the
injure party no more than a claim for
damages or for specific performance or both. By itself the mere
failure to perform timeously
does not bestow a right of cancellation
upon the injured party. The injured party is entitled to resile; as
opposed to claiming
damages or specific performance, only when, in
addition to the mora or breach of a material term, time is of essence
for the performance
of that term. The reason for this is apparent.
It is only when time is of the essence that such a breach goes to the
root of
the contract.’
[82] In Mackay v Naylor
1917 TPD 533
at
537 the court held that ‘the general rule of law is that
obligations for the performance of which no definite time is
specified are enforceable forthwith, but the rule is subject to the
qualification that performance cannot be demanded unreasonably
so as
to defeat the objects of the contract or allow an insufficient time
for compliance’. This principle is sometimes stated
as
follows, ‘where no time for performance is given, the
obligation must be performed within a reasonable time’. It
is
clear from the authorities that where no time has been set for
performance, as in the present matter, the party claiming
cancellation
is required among other things to place the other party
in mora by making demand for performance. See Breitenbacht v Van
Wijk
1923 AD 541
at 549. Trengrove JA summarised the principle as
follows in Ver Elst v Sabena Belgian Airlines
1983 (3) SA 637(A)
when
he stated at 644 D – H that: ‘Dit beteken egter nie dat
as hy sou nalaat om binne ‘n redelike tyd te presteer,
hy
sonder meer in mora sou verkeer nie want, soos Wessel AR in Nel v
Cloete (supra) na aanleiding die versuim van ‘n verkoper
om te
presteer op 159 F – G gesê het: ‘Blote versuim van
die verkoper om so gou as wat redelike wyse moontlik
is te voldoen,
het egter nòg volgens Romeinse reg, nòg volgens
Romeins-Hollandse reg, nòg volgens geldende
reg, die gevolg
dat die verkoper sonder meer in mora verval. Met ander woorde,
hierdie versuim het geen uitwerking op die regsposisie
van die
kontrakterende partye vir sover dit die ontstaan van mora betref nie
…
Indien die skuldeiser stappe wil doen
om die skuldenaar in mora te stel, is dit ‘n vereiste dat hy ‘n
kennisgewing aan
hom rig waarin hy die skuldenaar op ondubbelsinninge
wyse maan dat hy op of voor ‘n bepaalde dag moet presteer.
Hierdie
aanmaning is egter nie op ontbinding van die kontrak gerig
nie, maar is slegs bedoel om ‘n datum vir prestasie van ‘n
opeisbare vordering met sekerheid te bepaal, waar dit in die kontrak
nog uitdruklik nòg stilswyend beding is. Waar die
tydperk wat
gegun is, redelik blyk te wees verkeer die skuldenaar in mora indien
hy by verstryking daarvan in gebreke bly.’
See also
Johannesburg City Council v Norven Investments (Pty) Ltd
1993 (1) SA
627(A)
at 633 C – F and Scoin Trading (Pty) Ltd v Bernstein
[2010] ZASCA 160
;
2011 (2) SA 118
(SCA) at para 12.
[83] Since Clause 19 does not contain
any time limit for the performance of the obligation i.e. the
development of the proposed
equestrian facility, the plaintiff was in
my view required to demand performance within a stipulated time on
pain of cancellation,
where the defendant is in mora. It is now
accepted law that in order to place the defendant in mora, the
plaintiff must have made
a demand which is clear and unequivocal and
in which he called upon the defendant to comply with such demand
within a time which
was reasonable in the circumstances and at the
same time contain an offer by the plaintiff to perform his reciprocal
obligations.
See Christie et al, The Law of Contract in South Africa
6 ed. P519, Harms, Amler’s Precedent on Pleadings 7 ed. and
Kragga
Kamma Estates v Botha N.O.
1965 (3) SA 46
(AD) 61 G –
62C.
[84] Having regard to the authorities
hereinbefore I am satisfied that the plaintiff’s emails of 5
October 2010 and 6 November
2010 fall far short of the requirements
of demand, if they can be construed to constitute a demand at all.
In my view the defendant
was accordingly not placed in mora by the
plaintiff. As appears from the above, plaintiff has also failed to
discharge the onus
to show what a reasonable time is and also that he
allowed the defendant a reasonable time for completion of the
development of
the proposed equestrian facilities.
[85] The defendant’s purported
cancellation of the agreement must of course also be seen against the
backdrop that he himself
was required to perform certain obligations
in terms of the agreements. According to Christie, The Law of
Contract in South Africa
6 ed. p438, reciprocity applies ‘…
in any bilateral or synallagmatic contract, i.e. one in which each
party undertakes
obligations towards the other; the common intention
is that neither should be entitled to enforce the contract unless he
has performed
or is ready, to perform his own obligation’.
[86] In the present matter the
following are important indicators that reciprocity of obligations
apply:
1. The agreements contain a number of
obligations for both the plaintiff and the defendant;
2. The plaintiff had an obligation to
commence and complete the building within a certain period of time;
3. This obligation to commence building
was prominently disclosed in the marketing brochure, which also
included defendant’s
obligations.
[87] In the present matter it is
common cause that plaintiff did not comply with his obligation to
complete the building within
the time period as stipulated in the
agreements. The overwhelming evidence points to the fact that the
Hunters Valley development
is a development focussed primarily on the
hunt and that there are equestrian facilities available which include
extensive riding
trails, a cross-country course, arenas and stabling.
On the evidence the defendants have fulfilled virtually all their
obligations,
in that transfer of the portions sold to the plaintiff
have taken place, services have been installed, servitudes to protect
the
rights of the members of the development have been registered and
a home owners association has been established.
[88] The evidence further points to the
fact that both homeowners and visitors use the cross-country track,
arenas, stables and
the homestead. I further take into account the
fact that the reason for the defendant’s failure to perform as
contemplated
in Clause 19 was at least partly due to the plaintiff’s
failure to complete building as he was required to and due to several
factors outside of the control of the defendant, for e.g. the
difficulties and delays in obtaining the necessary governmental
authorisations and the economic down turn. Considering the facts and
circumstances hereinbefore set out, and even if I were to
find that
defendant was in breach of its obligations, then I am in any event
not persuaded that plaintiff has shown that defendant’s
breach
of its obligations was so material as to warrant cancellation of the
agreements. My finding in this regard is fortified
by the fact that
when I weigh up and balance the competing interest between the
plaintiff and the defendant, that the plaintiff’s
cancellation,
considering the circumstances of the matter, is radical and cannot be
permitted. See Singh v McCarthy Retail Ltd
t/a McIntosh Motors
[2000] ZASCA 129
;
2000
(4) SA 795
(SCA); Aucamp v Morton
1949 (3) SA 611(A).
I am
accordingly satisfied that should I grant the plaintiff cancellation
in these circumstances that it would be disproportionate
to the
alleged breach. In my view it would therefore be ‘unfair or
inequitable’ to force the defendant to comply with
its
obligations under Clause 19 in circumstances where the plaintiff has
himself failed to fulfil his obligations under the sale
agreements.
See Botha and Another v Rich N.O. and Others
2014 (4) SA 124
(CC).
[89] An additional hurdle that the
plaintiff faces in this matter and which he has failed to overcome is
that even if I were to
find in favour of the plaintiff and consider
the grant of an order for specific performance, I would be unable to
do so. I say
this because plaintiff has failed and neglected to
present evidence regarding what the proposed equestrian facilities
would be,
where they would be situated, what the size would be, how
they would look and/or what the costs would be to erect or build
these
facilities. No evidence was presented about what the so-called
site development plan entailed or what it was supposed to contain.
I
have already dealt with plaintiffs attempts to rely on the contents
of the marketing brochure and/or the article in the business
newspaper. The court should not be placed in a position where it is
required to speculate or play a guessing game on what is supposed
to
be contained in the ‘site development plan’ and
particularly what was envisaged by the parties by the inclusion
of
Clause 19 in the agreement.
[90] In the premises the plaintiff
cannot succeed with his claim for cancellation of the sale agreements
or any of the other relief
he claims.
[91] In the result I make the following
order:
The plaintiff’s claim is
dismissed with costs.
RILEY, AJ