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[2013] ZAGPJHC 32
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Beaux Lane (SA) Properties (Pty) Ltd v Snowy Owl Properties 310 (Pty) Ltd and Another (2009/49949) [2013] ZAGPJHC 32 (25 February 2013)
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REPORTABLE
REPUBLIC OF SOUTH AFRICA
IN THE SOUTH GAUTENG HIGH COURT
(JOHANNESBURG)
In the matter between:
CASE NO:
2009/49949
DATE:25/02/2013
In the matter between:
BEAUX LANE (SA) PROPERTIES (PTY)
LIMITED
........................................
Respondent
/ Plaintiff
and
SNOWY OWL PROPERTIES 310 (PTY)
LTD
(REGISTRATION
NUMBER:
2003/020639/07)
.............................................
First
Applicant/ First Defendant
.............................
and
STEPHAN LOTHAR KUHN
(IDENTITY NUMBER:..
)
...................................................................................
Second
Applicant/ Second Defendant
JUDGMENT
WEINER
J:
Introduction
[1] The
p
laintiff issued summons against
the
d
efendants in November 2009. The claim
arose against the first defendant from the breach of an agreement of
lease and against the
second defendant from a deed of suretyship.
[2] The
d
efendants entered a special plea,
a plea and a conditional counterclaim in March 2010. A plea and
replication by plaintiff was filed
also in March 2010. The original
special plea was disposed of prior to the trial of the matter which
was set down for October 2012.
[3] On the 12 and 15 October 2012, the defendants filed two Notices
of intention
to Amend the plea.
[4] The present application in terms of Rule 28 (4) relates to the
Notice
of Intention
to Amend dated 15
October 2012 (
“
the amendment
”
).
[5] In terms of the amendment, the
d
efendants
sought to insert a further special plea. In effect, they now claim
that the wrong
d
efendants are before Court
in the trial matter.
[6] The defendants rely on the following as the basis for this
amendment:
[7] The correct tenant of the leased property was Busicor 0055 CC
("Busicor"). There was an existing lease agreement
entered
into on or about 16 September 2008 between the
p
laintiff
and Busicor; (‘the Busicor lease
agreement
”)
[8] The lease agreement
concluded in January 2009,
(“
the January lease agreement”
)
annexed to the particulars of claim, upon which the plaintiff
relies, is not the
operative
agreement
between the
landlord and tenant
;
[9] There is no contractual nexus between the plaintiff and the first
d
efendant;
[10] The
p
laintiff therefore has no claim
against the
d
efendants.
[11] In placing before the court the factual analysis behind the
amendment, the defendants submit the following:
[12] the
p
laintiff claims that an agreement
of lease was entered into during January 2009
;
[13] t
he plaintiff alleges that first
defendant took occupation of the property during October 2008. The
defendant queries what governed
the occupation of the premises from
October 2008 until January 2009
;
[14] t
he claim of the
p
laintiff
is based upon the January lease
agreement
entered into between the
p
laintiff and the
f
irst
d
efendant;
and a written suretyship agreement entered into between the
p
laintiff
and the
s
econd
d
efendant
dated 10 November 2008.
[15] t
he plaintiff has failed in its
opposition to the amendment to deal with what governed the
relationship between the parties during
the period October 2008 and
January 2009. In dealing with the Busicor lease
agreement
, the plaintiff referred to the evidence of a
property manager of Eris, the managing agent on behalf of the
p
laintiff. No confirmatory affidavit of
such manager was attached.
[16] There is a signature on the Busicor lease
agreement
, purporting to be that of the landlord (the
plaintiff). However, the
p
laintiff failed
to deal with whether or not, it signed the Busicor lease
agreement
, and if so, what the consequences
of that are.
[17] The
material
relevant clauses
regarding the Busicor lease
agreement
entered into between the
p
laintiff and
Busicor, are the following:
[18] t
he agreement was an Offer to Lease
entered into between Busicor CC (
“
the
tenant
”
) and the
p
laintiff
("the landlord");
[19] t
he landlord was represented by an
authorised representative from Renprop (Pty) Ltd and the agreement
was signed by both the tenant
and the landlord, the latter on 16
September 2008;
[20] t
he lease period was five years
commencing on 1 October 2008 with the occupation date being 20
September 2008;
[21] t
he occupation of the premises would
take place once the deposit had been paid and a lease agreement had
been entered into;
[22] t
here was no prohibition on
sub-letting;
[23] t
here was a "Non-Variation"
clause providing that "No agreement to vary, add or cancel this
agreement shall be of
any force and effect unless reduced to writing
and signed by the parties or on behalf on the parties to this
agreement". It
is common cause that there was no variation of
the lease agreement on or before the occupation date, 20 September
2008;
[24] t
here was an
“Expiration of Offer" clause containing the
following:
[25] the offer was a firm and binding, irrevocable offer which would
remain binding only if accepted by noon on 16 September 2008
(this
occurred);
[26] on the acceptance of the offer, the offer would constitute a
binding agreement between the parties;
[27] the tenant and landlord would sign a lease agreement containing
provisions usually applicable to leases within a reasonable
period
after acceptance of the offer but prior to the occupation of the
premises (20 September 2008);
[emphasis added]
[28] in the event that the parties could not agree on the terms of
the lease agreement on or before 20 September 2008, the Busicor
lease
agreement would remain in force and occupation would be regulated by
such lease agreement.
[29] The January lease agreement was
signed on
10 November 2008
by the tenant
and
by the landlord on
19 January 2009. This was after the 20
September
deadline
and therefore not in
terms of the requirement in the Busicor lease
agreement
, which became the operative agreement on 20
September 2008 for a period of 5 years, coming to an end on or about
20
September 2013.
[30] The defendant submits that the plaintiff has not put forward any
acceptable version to gainsay the fact that the Busicor lease
agreement
governed the relationship between landlord and
tenant. As such, it is common cause that the Busicor lease
agreement
was concluded between the plaintiff and Busicor.
[31] The
d
efendants accordingly sought to
amend their Plea by incorporating the existence of the Busicor lease
agreement
. They allege that the present first defendant, Snowy
Owl
,
took possession of the leased
property, through a sub-lease.
[32] The plaintiff, in objecting to the amendment, did so
,
inter alia
,
on the basis that it amounted to a withdrawal of an admission.
They
refer to several instances in the plea and summary judgment affidavit
in which allegations are made that can only be seen as
an admission
of the existence of the January lease agreement. These include:
The first defendant made certain payments to the plaintiff in
respect of rental and related costs in terms of the January lease
agreement;
The first defendant (not Busicor) paid a deposit of R197 869,780;
The first defendant required an accounting and debatement process
between “plaintiff and first defendant”. This
suggests
a legal relationship between the plaintiff and first defendant;
the first defendant disputes that the January lease agreement has
been terminated. It pleads that the first defendant remains
in
occupation of the premises in terms of an agreement between “the
plaintiff and the first defendant”;
in terms of Clause 10 of the January lease agreement, permission
was granted by the plaintiff to the first defendant on 25
November
2009 to sublease the premises to a Bosch Auto Repair Centre;
The second defendant signed a resolution on behalf of the first
defendant to lease the premises in the name of the first defendant
as well as a debit authority on behalf of the first defendant;
The second defendant also signed an unlimited suretyship agreement
binding himself as surety and co-principal debtor for the
performance of the obligations of the first defendant in terms of
the Lease Agreement;
FICA documents were submitted in respect of the first defendant and
not Busicor.
[33] Relying upon those allegations, the plaintiff submits that the
proposed amendment amounts to the withdrawal of an admission
that the
first defendant concluded the lease agreement with the plaintiff as
landlord.
[34] The defendants
however
contend that
the January lease agreement was always in dispute.
Therefore
they deny
that an admission
is to be
withdrawn. Although, the basis of the defendant’s disputes
related to the lack of consensus on, inter alia, the extent of
the
premises, its counsel submits that there was a general denial of the
January 2009 lease throughout the pleadings and summary
judgment
affidavit. The defendant alleged that consensus was not reached
between the parties rendering the January lease agreement
unenforceable. As a consequence of the denial of the January lease
agreement, a conditional counterclaim was instituted, conditional
upon a finding that the
January
lease
agreement was indeed valid and binding.
[35] The defendants submit
therefore
that
the amendment is not inconsistent with the defence previously averred
and is not a withdrawal of an admission.
[36] It is correct that
an
amendment amounting to a withdrawal of an admission is usually more
difficult to achieve. It requires a full explanation to convince
the
court of the bona fides thereof as it is more likely to prejudice the
other party. However, if on an investigation of the case,
the facts
show that the admission was wrongly made, there is no absolute bar to
the amendment being sought and granted. Accordingly,
even if the
allegations in the plea and summary judgment affidavit amount to
admissions, but it appears that because the defendants
were not in
possession of the relevant document, incorrect admissions were made,
same would not necessarily bar the amendment.
As long as same is
adequately explained, is bona fide, and raises a triable issue and
the plaintiff is not unduly prejudiced, the
amendment can be
granted.
1
[37] The defendant claims that it was only when the Busicor lease
agreement was discovered shortly prior to the October trial date
that
same clarified the picture.
[38] In deciding whether or not to allow an amendment
the
Court must exercise a judicial discretion regarding what is right,
just, equitable and reasonable. The purpose of allowing an amendment
is to "obtain a proper ventilation of the dispute between the
parties, to determine the real issues between them, so that
justice
may be done."
2
[39] The defendants submit that the only issue is whether the
plaintiff will suffer prejudice which cannot be cured by an order
for
costs. As a consequence, the practical approach is that "amendments
will always be allowed unless the application to amend
is mala fide
or unless such amendment would cause an injustice to the other side
which cannot be compensated by costs, or in other
words unless the
parties cannot be put back for the purposes of justice in the same
position as they were when the pleadings which
is sought to amend was
filed"
3
.
This Court is therefore not required to adjudicate upon the merits of
the amendment. This would be considered by a court hearing
the trial.
Issues such as the plaintiff’s case on the merits being
adversely affected
do not amount to prejudice
.
4
[40] The plaintiff further objects to the amendment on the basis of
the timing thereof. At the time of the filing of the affidavit
resisting Summary Judgement in January 2010 as well as the initial
plea, special plea and the conditional counterclaim in March
2010,
the defendants state that they did not have a copy of the Busicor
lease agreement. It was only furnished to them as a consequence
of
the request for documents from the plaintiff’s Discovery
Affidavit. It was made available on 10 September 2012. The defendant
sought the amendment shortly after it received the document. The
plaintiff disputes these contentions, relying upon the following:
there was early discovery of the Busicor document;
due to the involvement of the second defendant in both entities
there is no reason why he would not have been aware of the
Busicor
lease agreement;
the lateness of the amendment causes prejudice. It comes three
years after initiation of litigation. If it is found that
Busicor
was the tenant, the plaintiff may be met with a defence of
prescription.
[41] The defendants contend that where a new ground for a defence
comes to the defendant's knowledge for the first time after the
filing of its plea, he will be allowed to amend his plea provided
that the application was bona fide and not prejudicial to the
opponent
.
5
[42] d
efendants submit that a bona fide and
triable issue exists between the parties on the issue as to which
agreement governs the relationship
between the parties. The
p
laintiff
may need to join Busicor and seek consequential amendments as a
result thereof, but this does not detract from the defendants’
case on the amendment.
[43] The d
efendants further contend that
the plaintiff cannot claim prejudice when it, at all times knew of
the Busicor lease agreement and
was in possession thereof. It elected
to issue a summons against the current Defendants based upon the
January lease agreement,
without disclosing the existence and import
of the Busicor agreement. It appears to be common cause that the
Busicor lease agreement
has not been cancelled.
[44] The
d
efendants argue that the January
lease agreement was signed on behalf of Snowy Owl on 10 November 2008
and on behalf of the
p
laintiff on 19
January 2009 in circumstances where the Busicor lease agreement was
operative and had not been cancelled. The January
lease agreement
could not be regarded as a new lease agreement as it was not between
the same parties and it was not agreed between
the parties that such
agreement would come into operation between different parties at a
time when the Busicor lease agreement
was operative.
[45] It appears to me that the proposed amendment
does raise a triable issue, both on the facts and on the law. Whether
the probabilities
are against such version is a matter for the trial
court. It has not been shown that the amendment is not bona fide. The
prejudice
suffered by the plaintiff at this stage can be cured by a
costs order. The court needs also to take cognisance of the fact that
the defendant failed to deal with the background to the January lease
agreement by referring to the Busicor lease agreement. The
court
cannot decide at this stage, but the prejudice to the defendant may
well be self-created.
[46] In regard to costs, it does not appear that the plaintiff’s
opposition was unreasonable. The defendants seek an indulgence
and
should pay the costs thereof.
In the result the following order is made:
The defendants are granted leave to amend their
plea in terms of paragraphs 1 to 11 of the Applicants’ notice
in terms of
Rule 28 dated 15 October 2012;
The d
efendants are to
pay the costs of the amendment, jointly and severally.
_________________________
SE WEINER
JUDGE OF THE HIGH COURT
Counsel for the Plaintiff: Adv. H. Louw
Applicant’s Attorneys: Matthew Kerr-Phillips
Counsel for the Defendant: Adv. G. Young
Defendant’s Attorneys: Marcou Gluch Attorneys
Date of Hearing: 13 February 2013
Date of Judgment: 25 February 2013
1
Bellairs v Hodnett & Another
1978 (1) SA
1109
(A) 1150F–H; Group Five Building (EC) (Pty) Ltd and
Another v The Minister of Public Works
[1997] JOL 241
SE at page 26;
Dali and Others v Government of the Republic of South Africa and
Another
[2000] ZASCA 119
;
[2000] 3 All SA 206
A at paragraphs [21] and [22]
2
Cross v Ferreira
1950 (3) SA 443
(C) at 447
3
Moolman v Moolman Estate 1927 CPD at
paragraphs 27-29.
4
GMF Kontrakteurs (Edms) Bpk v Pretoria City
Council 1978(2)T 219 at 222G
5
See fn 1
supra