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[2011] ZAGPJHC 87
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Auction Alliance (Pty) Ltd v Netluk Boerdery CC and Another (2011/10152) [2011] ZAGPJHC 87 (3 August 2011)
REPORTABLE
SOUTH
GAUTENG HIGH COURT, JOHANNESBURG
CASE NO:
2011/10152
DATE:03/08/2011
In the matter between:
AUCTION
ALLIANCE (PTY)
LTD
.......................................................
Applicant
and
NETLUK
BOERDERY
CC
…..............................................................
First
Respondent
PIETERS,
MATHEUS JACOBUS
…......................................
Second
Respondent
J U D G M E N T
HALGRYN, AJ
:
The parties
[1] The Applicant is Auction
Alliance (Pty) Ltd, cited herein as a company with limited liability,
registered and incorporated
as such in terms of the company laws of
South Africa, whose directors and employees, at all times material
hereto, were allegedly
the holders of a valid Fidelity Fund
Certificate issued to them in terms of section 26(a) of the Estate
Agency Affairs Act.
1
[2] The First Respondent is
Netluk Boerdery CC, cited herein as a close corporation registered
and incorporated as such in terms
of the Close Corporations Act of
the Republic of South Africa.
[3] The Second Respondent is
Matheus Jacobus Pieters, cited herein as the Managing Director of
Witbank Abattoir (Pty) Ltd.
The relief sought by the Applicant
[4] The Applicant’s claim
against the First Respondent is contractual; for payment of the
balance of commission earned in
respect of a sale of certain
immovable property, effected at an auction which was conducted by the
Applicant. The Applicant’s
claim against the Second Respondent
is based on a written deed of surety, which the Second Respondent had
signed to ensure compliance
by the First Respondent of its
contractual obligation to pay the aforesaid commission to the
Applicant.
[5] The relief sought by the
Applicant - by motion proceedings - is the following:-
“
1.
That judgment be granted against the First and Second Respondents,
jointly and severally, the one paying the other to be absolved
in the
sum of R3 700 000,00;
Interest on the aforesaid amount at the rate of 15,5% per annum
from 7 December 2010 to date of final payment;
Costs of suit on attorney and own client scale;
Further and/or alternative
relief.
”
The relief sought by the Respondents
[6] The First and Second
Respondents contend that the First Respondent was induced to purchase
the aforesaid immovable property
as a result of and on the strength
of deliberate misrepresentations by the Applicant, entitling the
First Respondent to rescission
and restitution. They thus seek an
Order that the Applicant’s application be dismissed with costs,
on the attorney and own
client scale. The First Respondent also
contends that it is entitled to return of the part payment of the
commission, it had paid
to the Applicant, in the amount of R2
million. It filed a counterclaim in which it seeks the following
relief against the Applicant:-
“
1.
That the Applicant be ordered to pay the First Respondent the
following:
The
amount of R2 million;
Interest on the aforesaid amount at the rate of 15,5% per annum
from 7 December 2010 to date of payment;
Costs of suit on the scale as between attorney and own client.
2. That such further and
alternative relief as this Honourable Court may deem fit be granted
to the First Respondent.
”
The factual background to the dispute
[7] The following facts –
which lie within a small compass - are largely common cause, or
cannot seriously be disputed. Moreover,
I adopt the approach - which
is by now trite - that the Applicant cannot succeed unless the
statements or omissions made by the
Respondents together with the
undisputed facts would entitle the Applicant to relief.
2
[8] The Applicant is an auction
house. It conducted an auction at the Southern Sun Hotel in Sandton
on 7 December 2010.
[9] The property which was
auctioned off on this day, was a certain immovable property
belonging to Hartenbos Landgoed (Pty) Ltd
(in liquidation), situated
in Hartenbos.
[10] Prior advertisements in the
national press – placed by the Applicant – attracted the
attention of prospective
bidders and enticed them to attend this
particular auction, including that of the Respondents.
3
The advertisements in the Sunday Times read as follows:-
“
71
completed houses and 62 stands, Southern Cape … Hartenbos
Landgoed (Pty) Ltd (in liq) (Master’s reference: C1172/2009).
Hartenbos Landgoed is one of the largest security resorts in the
Garden Route coastline. Improvements: 71 luxury units (2 and
3
beds) with full services and ready to go. Stands: 62 serviced
stands.
”
[11] It is indisputably so that
the purpose of the advertisements was to generate interest in the
auction and to induce and persuade
prospective bidders to attend the
auction; and to bid there, in attempts to purchase the advertised
property.
[12] Encouraged and inspired by
this advertisement, the Respondents did their homework and decided to
bid up to R50 million for
the property.
[13] The Second Respondent and
his brother – an admitted attorney – attended the
auction. At the auction the Applicant
made available to all
prospective bidders a “
flyer
”
or “
auction
papers
” which
read as follows:-
“
Hartenbos
Landgoed is one of the largest security resorts on the Garden Route,
situated between two river mouths at the Little Brak
and Hartenbos
Rivers. Just 10 minutes drive from Mossel Bay along the N2 highway.
The estate includes internal roads, landscaping,
boundary walls,
security access and facilities. Improvements: 71 completed luxury
units (2 and 3 beds) with full services and
ready to go. Stands: 62
serviced stands.
”
[14] The purpose of the
flyers/auction papers was unarguably to convey to
potential/prospective bidders who attended the auction
that the
characteristics of the property - which was about to be auctioned off
- included,
inter alia
,
the following:-
It was one of the largest security resorts on the Garden Route.
The estate included boundary
walls.
It contains 71 completed luxury
units (2 to 3 bedrooms) fully serviced and which were ready to go.
It included 62 serviced stands.
[15] The representations
contained in the flyers/auction papers, echoed those representations
made to the public at large in the
advertisements in the Sunday
Times. It is thus fair to say that those bidders – including
the Respondents – who attended
the auction as a result of the
advertisements in the Sunday Times, were able to take much comfort
from the fact that the contents
of the flyers/auction papers
reaffirmed the contents of the advertisements.
[16] Shortly upon attending the
premises where the auction was about to be held, the Second
Respondent completed the Applicant’s
registration form and
signed it.
4
Above the space provided for signature the following appears in
print:-
“
I,
the undersigned, acknowledge that I have fully read, understood and
acquainted myself with the conditions of sale. Notwithstanding
the
fact that the auctioneer/s has not read out every clause of the
contract, I will legally comply myself with all my obligations,
including immediate signing of the conditions of sale on the fall of
the hammer.
”
[17] The property was auctioned
off and the Second Respondent made the highest offer, resulting in
the property being knocked down
to him, at a bid price of R50
million.
[18] The Second Respondent,
immediately after the bid was knocked down to him, signed a document,
which was also a standard document
utilised by the Applicant at its
auctions, which reads as follows:-
“
I,
the undersigned, as bidder number 2374 acknowledge that at the
auction which took place on 7 December 2010 at the Southern Sun,
Hotel the property described as PTN10 of the farm Valley No. 219
Mossel Bay Road was knocked down to me at my bid price of R50
mill
excluding auctioneer’s commission and that I am accordingly
required to immediately sign Auction Alliance’s Conditions
of
Sale and confirm that I am aware of all the provisions thereof.
”
5
[19] I did not distinguish
between the handwritten portions and the printed portions on this
document.
[20] The Second Respondent
thereafter, representing the First Respondent, signed the Applicant’s
conditions of sale
6
and in his personal capacity, signed the deed of surety.
[21] Significantly the
Respondents contend, in paragraphs 9.4 to 9.6 of the answering
affidavit that the following occurred during
the signing of the
conditions of sale:-
“
9.4
What also took place at the time of signing (and which the
Applicant’s deponent omitted to state) was that my brother
in
fact asked the deponent whether what was depicted on the ‘auction
paper’ was indeed what he and I would find if
we were to go
down to Hartenbos (which we intended doing the next day). The
deponent confirmed that everything is as stated save
‘perhaps
for a loose tile here or there’.
He then jokingly
stated that Investec Bank would “chip in” a bag or two of
tile cement. A representative of Investec
Bank, equally jocularly,
declined this.
9.5 I categorically state
that at the signing of the said agreement I was under the firm
impression that nothing in the agreement
would be contrary to what
has been depicted in the auction papers and the advertisement (I also
add that the auctioneer had a projection
of the photograph on the
advertisement projected as a background to the auction.) I was
fortified in this belief of mine in that
the auctioneer who required
us to sign the documents stated that it was a ‘standard
document’.
9.6 Had I at any stage been
asked to read through the documents or been explained what the
contents thereof was or being told that
what was in fact auctioned or
described in this document was not what the liquidators and the
auctioneers had represented to be
sold, I would firstly not have bid
at the auction (or at least not up to R50 million) and neither would
have signed the conditions
of sale.
”
7
[22] The allegations in
paragraphs 9.5 to 9.6 of the Respondents’ answering affidavit
were met with only a bald denial, were
not dealt with in any amount
of detail and thus not seriously denied in the Applicant’s
replying affidavit; the Applicant
electing to brush it off as
irrelevant. I view these allegations as material herein and I have
no option but to find on the Respondents’
version in this
respect.
[23] It is unmistakably so that
the Applicant had adopted the approach herein that its exclusionary
clauses, which I deal with
hereunder – would oust all possible
defences herein.
[24] The Applicant contended
that the following clauses contained in the conditions of sale are
the “
most
relevant for the purposes of this application
”:-
The First Respondent
acknowledged that it had read and understood all of the terms and
conditions and agreed that it was bound
thereto;
8
The First Respondent was liable
to pay the Applicant’s commission, which was deemed to have
been earned and was payable
immediately upon the fall of the hammer
or upon the signing of the conditions of sale; whichever happened
first;
9
The property was sold
“
voetstoots
”;
10
The Applicant furnished no
warranties and undertakings relating to the property;
11
The First Respondent
acknowledged that:-
24.5.1 it had fully acquainted
itself with the property;
12
24.5.2 it was aware that certain
portions of the property were undeveloped and incomplete;
13
24.5.3 it purchased the property
on the basis that it was incomplete;
14
24.5.4 it assumed all risk in
this regard;
15
24.5.5 it waived and abandoned
any claim against the Applicant as a result of the property being
incomplete;
16
24.5.6 the conditions of sale
constituted the whole agreement;
17
24.5.7 it had not been induced
into entering into the agreement by any express or implied
information, statement, advertisement
or representation not contained
in the agreement;
18
24.5.8 no variation, alteration
or cancellation of the conditions of sale would be of any force or
effect, unless in writing and
signed by the parties.
19
[25] Immediately after the
Second Respondent signed the conditions of sale and the deed of
surety, the First Respondent paid to
the Applicant the amount of R2
million, in part settlement of the deposit. The Applicant allocated
the R2 million – as it
was allegedly entitled to do in terms of
clause 3.6 of the Conditions of Sale, to its commission. This –
so the Applicant
contends - left an amount of R3,7 million due to the
Applicant, by the Respondents, in respect of the Applicant’s
commission,
earned as a result of the aforesaid auction and resultant
sale.
[26] After the auction, the
Second Respondent had the moment to inspect the property which the
First Respondent had purchased at
the auction. He found that what he
thought the First Respondent had purchased, differed materially from
what he found to be the
actual case down in Hartenbos. The
Respondents contend that the content of the advertisements and the
flyers/auction papers were
false and stated:-
“
8.11.1
Twenty of the 71 units were not ‘completed’ and in some
instances needed major building works in order to complete
these
units.
The property was not surrounded by boundary walls.
The property was not a ‘security resort’.
There were no services to
the 62 vacant stands as claimed.
An environmental
contribution equal to 1% of the purchase price of each of the
units sold will have to be paid by the environmental
trust and the
fees for the ROD have not been paid.
Although the 62 stands were
in fact sectional title units as set out in the conditions of
sale, neither the 71 units nor the
62 units were ‘ready to
go’.
”
20
[27] These material allegations
as to how the contents of the advertisement and the flyers/auction
papers differed, from what was
actually the case, were once again met
with a bald denial by the Applicant in its replying affidavit; the
Applicant again electing
to contend that these allegations are
irrelevant.
[28] The Respondents contended
further that the Applicant and the liquidators were aware of the true
facts and the incorrectness
of the advertisements.
21
[29] Significantly, this was not
simply a bald unsubstantiated allegation. To support this allegation
the Respondents alleged the
following:-
“
8.12
In this regard I firstly refer this Honourable Court respectfully to
the affidavit made by one Martha Maria Pretorius annexed
hereto as
‘MJP3’ (together with Annexures ‘A’ and ‘B’
thereto). The contents of this affidavit
can be translated and
summarised as follows:-
8.12.1 Said Ms Pretorius is
an estate agent in the Hartenbos area. She was involved with the
Hartenbos Landgoed since 2004.
8.12.2 On 20 September 2010
she wrote to the liquidators making certain suggestions regarding the
sale of the units. These suggestions
are contained in Annexure ‘A’
and ‘B’ of the affidavit.
8.12.3 In the said marketing
proposal she stated that 9 units were still incomplete and a lot of
construction work still had to
be done in respect of other units.
She provided the liquidator with details of the units which were not
completed together with
photographs and quotes.
8.12.4 She also, upon
enquiries, personally in her office conveyed the same to Mr Richard
Gross of Investec Bank on 2 November
2010.
8.13 I also respectfully
refer the Honourable Court to Annexure ‘MNJP4’ hereto,
being an affidavit of a copy of an
affidavit
(sic)
by one Johanna Francina
Mouton. For ease of reference and sake of convenience and with due
regard to the importance of the affidavit,
I quote the contents
thereof here in full:-
‘
1. I am the estate
manager of the estate known as Hartenbos Landgoed …
2. I have been the estate manager for the past 2½ years
whilst the developer of the estate, Hartenbos Landgoed (Pty) Ltd
was
in the process of going into liquidation.
3. During this period
referred to in clause 2 supra various officials of Investec Bank
visited the property. They required me
during these visits to unlock
the various units for inspections as well as the show houses for
sale. On occasion Mr Pellow of
West Trust, the liquidators,
accompanied these officials. I attach hereto a photocopy of the
business card which he gave to me
on one of his visits as annexure
“A”.
4. During or about
October/November 2010 a Mr Gareth Currie of Auction Alliance paid a
visit to the estate. He informed me that
the property was going on
auction and he was there to take photos for the publication. I
attach hereto a copy of his business
card as annexure “B”.
5. During November 2010 an
advertisement by Auction Alliance appeared in the newspaper, Die
Burger. At that stage the said Currie
from Auction Alliance was in my
office and showed me the advertisement in Die Burger as well as the
Auction Alliance Board to advertise
the sale. I immediately pointed
out to him that the advertisement was incorrect in the following
respects:-
(a) There were not 122 units
for sale and they were not ‘ready to go’. There were
only 71 units of which 10 units
were not completed.
(b) There were no boundary walls and this was not a security
estate.
(c) He immediately phoned his
superior in Cape Town. He told me that the staff member responsible
for this advertisement would
surely lose his job.
6. On various occasions a Mr
Zindel of Auction Allowance
22
(business card attached as Annexure “C”), Mr Wallace from
West Trust as well as a woman claimed to be the advocate
of Investec,
paid a visit to the property. On all these occasions I had to unlock
the houses, including houses not completed for
them to inspect. I
can categorically say that the officials from Investec Bank, West
Trust and Auction Alliance all knew about
the houses not fully
completed and that there was no security walling.
’
8.14 Both West Trust, Wallace Trust and Mr Gareth Currie are
referred to in the advertisement annexed hereto as Annexure ‘MJP1’.
In further confirmation of
the correctness of the affidavit of Ms Mouton I respectfully refer
the Honourable Court to annexure
‘MJP5’ hereto, being a
copy of an extract of the ‘Entry control for visitors or
vehicles’ at Hartenbos
Landgoed for 18 November 2010
indicating a visit by one, ‘Gareth’ from the Applicant
between the hours 08h40 and
09h50.
At the auction,
representatives of the liquidators, Investec Bank and the Applicant
were present. At no stage prior to the commencement
of the auction
were any of the aforesaid false representations pointed out to the
bidders.
”
[30] Again, the Applicant
brushed off these allegations with bald denials in its replying
affidavit, steadfastly contending that
they are irrelevant. These
allegations are highly relevant and I am left with no option but to
accept the Respondents’ contentions
in this regard and to find
that the Applicant knew that the contents of its advertisements and
the flyers/auction documents differed
materially from the true facts.
The legal position and its application to the facts herein
[31] In my view, the Applicant
was/is misconceived in its firm belief that its exclusionary clauses
could oust any defence, including
that of a deliberate
misrepresentation herein. On the contrary, a defence of fraud –
if proven on the facts – would
in my view, trump all
exclusionary clauses. Nestadt JA found:
”
That leaves the
question of fraud. No doubt fraud is a special case. In words of
Denning LJ in Lazarus Estates Ltd v Beasley
[1956] 1 QB 702
at 712,
‘fraud unravels everything’.
Professor Baxter, in his Administrative Law at 519, says that
dishonesty is the most tenacious ground of review;
it survives the strictest ousters of the Courts’ jurisdiction
.
The well-known case of Union Government v Fakir
1923 AD 466
is a good
illustration of this.”
23
(I added the emphasis.)
[32] Mr Davis on behalf of the
Respondents, referred me to a recent – as yet unreported –
Judgment,
24
wherein Bosielo JA stated as follows:-
“
[21]
It is true that any misrepresentation is likely to result in a
mistake made by the person induced by it to enter into a contract.
But that mistake might not be iustus and therefore actionable. If,
however, the mistake is both reasonable and material, the
contract
may well be void. But in this matter mistake was not the primary
basis of Morgan Air’s claim that it was entitled
to claim
return of the moneys paid under it. Its claims were made on the
basis of fraudulent misrepresentation. And the court
below erred in
finding that the contract was rendered void by the unilateral mistake
of Morgan Air.
[22] It has been settled law
for many decades that a material representation renders a contract
voidable at the instance of the
misrepresentee. Absent the voetstoots
and exclusion clauses cited above, Morgan Air would have been
entitled to ask for rescission
and restitution even if the
misrepresentation had been innocent.
[23] But liability for a
misrepresentation made innocently and even negligently can be
excluded by parties to a contract –
hence the conjecture that
Murphy J found that the misrepresentation had been made negligently
and that it had resulted in iustus
error that rendered the contract,
including the exclusion clauses, void. As stated, however, a
misrepresentation generally renders
a contract voidable. The
innocent party may elect to abide by it even where the other party
has been fraudulent.
The difference that fraud makes
is that one cannot contract out of liability for fraudulent conduct
.
”
(I added the emphasis.)
25
[33] Bosielo JA continued to
state:-
“
[26]
There is no doubt that the fraudulent misrepresentation made by the
Moolmans and Lehmacher was material and that it directly
induced
Morgan Air, which was looking for a commercial property, to purchase
Sim Road’s property
.
The exclusion clauses in the contract signed by
Morgan had no effect given the fraud
.
It follows that Morgan Air was entitled to rescind the
agreement for the purchase of the property and to claim the
moneys
that it had paid as a deposit and as auctioneer’s commission.
”
(I added the emphasis.)
[34] It also does not avail a
party to a contract, who stands accused of fraud, to contend that the
misrepresentee had been foolish
or negligent in relying on the
misrepresentation. Bosielo JA further stated:-
“
[24]
And even where a misrepresentee has been foolish or negligent in
relying on the fraudulent misrepresentation, that does not
in any way
affect the liability of the misrepresentor. In Standard Credit
Corporation Ltd v Naicker
26
Milne JP said it does not avail one guilty of fraud to say that the
victim was negligent in believing the misrepresentation. He
quoted
from the judgment of Jessel MR in Redgrave v Hurd
27
:-
‘
If a man is induced to
enter into a contract by false misrepresentation, it is not
sufficient answer for him to say “if you
had used due diligence
you would have found out the statement was untrue’.’
”
[35] In
Central
Merchant Bank Ltd v Oranje Benefit Society
28
the Court stated the following:-
“
In
order to give a fraudulent person immunity for his statements, it is
not enough that a more careful person might not have been
deceived. …
The
growing trend and tendency of the courts will continue to move
towards the doctrine that negligence in trusting in a
misrepresentation
will not excuse positive wilful fraud or deprive
the defrauded person of his remedy.
”
[36] Mr Wickins, on behalf of
the Applicant correctly submitted, that the Respondents must allege
and prove fraud “
clearly
and succinctly
”
and in this respect referred me to
Courtney-Clarke
v Bassingthwaighte.
29
I also agree with Mr Wickins that fraud is not easily inferred,
proved or established and that the Respondents bear the
onus
to establish the alleged fraud. He also correctly submitted that a
factual basis must be laid which proves the fraud and speculative
propositions do not suffice.
30
[37] Mr Wickins also correctly
submitted that the following essential allegations had to be made and
proved – the standard
being no higher than on a balance of
probabilities - in order to establish fraud:
That a representation was made
to the Respondents;
The content of the representation;
That the representation was untrue;
That the Applicant knew that
the representation was untrue;
That the Applicant intended the
representation should be acted upon by the Respondents;
That the Respondents were in
fact induced to act upon the representation.
31
[38] I now turn to deal with,
whether – as a fact – the Respondents succeeded in
establishing the existence of a deliberate
misrepresentation herein.
[39] The advertisements in the
Sunday Times and the flyers/auction papers which were handed out to
bidders at the auction constituted
clear representations by the
Applicant to the Respondents. I do not understand this to be in
dispute, and it would be foolhardy
to contend that it was. In the
particular circumstances of this case, these representations were
augmented by the verbal assurances,
by the deponent to the
Applicant’s founding affidavit, to the Second Respondent and
his brother, that “
save
for a loose tile or two
”
the property in Hartenbos was exactly as described in the
advertisement and in the flyers/auction papers.
[40] The content of the written
representations are not in dispute and they are as contained in the
advertisements and the flyers/auction
papers. In addition, I have to
accept the verbal assurances to the Respondents, by the deponent to
the Applicant’s affidavits
filed herein - as they were not
earnestly denied.
[41] These representations were
unquestionably untrue. I have no option but to find on the
Respondents’ version that this
is so. It must be borne in mind
that the best possible defence for the Applicant to the First
Respondent’s counter-claim
herein, would have been to prove –
and this assuredly would not have been too difficult, (if it was
indeed so), - that there
existed no deceptiveness in the
representations. This was purely a factual question; but the
Applicant elected not to deal with
it.
[42] The full extent of the
untruth, was fully set out and canvassed in the answering affidavit,
and not at all seriously placed
in dispute by the Applicant in its
replying affidavit. A bald denial about something so material herein,
cannot and does not suffice.
The same holds true for the remainder of
the Applicant’s bald and unsubstantiated denials herein.
[43] The Respondents took care
to show that the Applicant was aware of the fact that the
representations were untruthful and in
similar vein, the Applicant
did not seriously contest the direct and pertinent allegations, that
it was fully aware of the falsehood,
of the representations. Again –
a bald denial cannot assist the Applicant and I have no option but to
find on the Respondents’
version in this respect.
[44] I also have to accept the
Respondents’ contention that the Applicant intended that the
representations should be acted
upon by the Respondents. It cannot -
conceivably - be contended otherwise. That was the designed purpose
of the advertisements
and the flyers/auction papers.
[45] Lastly - on the topic of
whether the Respondents have alleged and proven all the necessary
elements/requirements of a deliberate
misrepresentation - I have to
accept the Respondents’ version, when they contend that they
were – as a fact –
induced to act upon the
misrepresentations. This was the very reason they elected to bid for
the property at the auction.
[46] In conclusion, by
conducting the auction under these circumstances, i.e. well aware of
the fact, that that which was about
to be auctioned off, differed
materially from the advertisements which allured and enticed
prospective bidders to attend the auction
in the first place, and the
contents of the flyers/auction documents which reverberated - in
every respect - the contents of the
advertisement, leaves room for
one inescapable conclusion; the Applicant deliberately misrepresented
the true facts to the bidders
who attended the auction as a result of
the advertisements and more specifically to the Respondents herein.
Significantly, the
Applicant never sought to contend that the
misrepresentation was either innocent, or negligent.
[47] Mr Wickins also contended
that the written and signed conditions of sale which contained the
clause that the property was
“
incomplete
”
leave no room for me to find a deliberate misrepresentation. I
disagree. Even if I were to find that the Second Respondent
did in
fact read the conditions of sale, the recordal - itself - that the
property which was being purchased was “
incomplete
”
would not have been inconsistent with the contents of the
advertisement and the flyers/auction papers. This was clearly
a
development and the referral to 62 (empty) stands could be understood
by any reasonable businessman/developer, as rendering the
estate
being “
incomplete
”,
in that respect. This also does not detract from the fact that the
advertisements and the flyers/auction papers were false
in other
material respects. Moreover, the written acknowledgement, that the
property was “
incomplete
”,
also cannot outdo the deliberate misrepresentations, for the reasons
I set out hereinabove.
Conclusion
[48] In the premises, the
Respondents have successfully alleged and proved a deliberate
misrepresentation herein, by the Applicant.
The Applicant’s
application must therefore fail and the First Respondent’s
counter-application must succeed. All the
parties herein claimed
costs on the attorney and own client scale and no submissions were
made that – whichever way it went
– I should find
otherwise. In any event, it would seem the appropriate scale, given
the findings herein. In the premises
I make the following Order:
The Applicant’s
application is dismissed with costs on the scale as between attorney
and own client.
The Applicant is hereby ordered
to pay to the First Respondent, the amount of R2 million, together
with interest on the aforesaid
amount, at the rate of 15,5% per
annum from 7 December 2010, to date of payment.
The Applicant is hereby ordered
to pay the First Respondent’s costs in respect of the
counter-application on the scale as
between attorney and own client.
____________________________________
L
P HALGRYN
ACTING JUDGE OF THE
SOUTH GAUTENG
HIGH COURT, JOHANNESBURG
DATE OF THE HEARING: 8 JUNE 2011
DATE OF THE JUDGMENT: 30 JUNE
2011
COUNSEL ON BEHALF OF THE APPLICANT: ADV GD WICKENS
COUNSEL OF BEHALF OF THE RESPONDENTS: ADV N DAVIS SC
1
No
112 of 1976.
2
See
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984 (3) SA 623
(A) at 634;
Tamarillo
(Pty) Ltd v B N Aitken (Pty) Ltd
1982
(1) SA 398
(A) at 430-431 and
Stellenbosch
Farmers’ Winery Ltd v Stellenvale Winery (Pty) Ltd
1957
(4) SA 234
(C) at 235.
3
The
First Respondent being represented by the Second Respondent, at all
times material hereto.
4
A copy of this registration form appears as Annexure “B”
at page 19.
5
A copy of this document appears as Annexure “C” at page
20.
6
A copy of the conditions of sale is marked “D” and
appears at pages 21-32.
7
At pages 137-138.
8
Clause 25.1.
9
Clause 5.1.
10
Clause
14.
11
Clause 14.1.1.
12
Clause 14.4.
13
Clause 14.1.2.
14
Clause 14.1.3.
15
Clause 14.1.2.
16
Clause 14.1.3.
17
Clause 25.
18
Clause 14.3.
19
Clause 25.
20
In paragraph 8.11 of the answering affidavit at page 130-131.
21
Paragraph 8.11.7 at page 131.
22
Who is also the deponent to the Applicant’s founding affidavit
herein.
23
In
Gilbey
Distillers & Vinters (Pty) Ltd and Others v Morris NO and
Another
[1990] ZASCA 134
;
1991
(1) SA 648
(A), at p659.
24
Sim
Road Investments CC v Morgan Air Cargo (Pty) Ltd
,
under Case No. 024/10, Harms DP, Lewis JA, Seriti JA and Petse AJA,
constituting the remainder of the Bench. It was not clear
from the
copy which was handed to me if the remainder of the Bench concurred
- but I assume so - as I am convinced that Mr Davis
would have
informed me if this were not so.
25
Bosielo JA relied on the following authorities in support of his
dictum
:
Brink
v Humphries & Jewell (Pty) Ltd
2005
(2) SA 419
(SCA) para 2; R H Christie,
The
Law of South Africa,
5
th
edition (2006) at 286
ff
;
Trotman
v Edwick
1951 (1) SA 443
(A) and
Ranger
v Wykerd
1977
(2) SA 976
(A);
Wells
v South African Alumenite Company
1927
(A) 69.
26
1987 (2) SA 49
(N) at 51B-E.
27
(1882) 51 LJ Ch 113
at 117.
28
1975 (4) SA 588
(C) at 594F.
29
1991 (1) SA 684 (Nm) 689.
30
Mr Wickins referred me to
Gilbey
Distillers and Vintners (Pty) Ltd v Morris NO
1990
(2) SA 217
(SE);
Nedperm
Bank Ltd v Verbri Projects CC
1993
(3) SA 214
(W).
31
He referred me to
Ruto
Flour Mills (Pty) Ltd v Moriates
1957 (3) SA 113
(T);
Smith
and Youngson (Pvt) Ltd v Dubie Bros
1959 (2) SA 130
(FC);
Novick
and Others v Comair Holdings Ltd
1979 (2) SA 116
(W) 149;
LAWSA
Vol 5(1) (paras 148-149);
Harms,
Amler’s
Precedence
of Pleadings
7
th
edition, 215;
Principles
of Pleadings and Civil Action,
page 300. There hardly exists a more comprehensive compilation of
the authorities relating to the subject under discussion, than
the
one by Harms,
supra
.