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[2013] ZAGPJHC 210
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Monyetla Property Holdings v Imm Graduate School of Marketing (Pty) Ltd and Others (10083/2012) [2013] ZAGPJHC 210 (28 August 2013)
REPUBLIC OF SOUTH AFRICA
SOUTH GAUTENG HIGH COURT
JOHANNESBURG
CASE
NO: 10083/2012
DATE:28/08/2013
In the matter between
MONYETLA PROPERTY
HOLDINGS
...................................................
PLAINTIFF
and
IMM GRADUATE SCHOOL OF
MARKETING (PTY)
LTD
.........................................................
FIRST
DEFENDANT
TATTERSALL, NIGEL
COLIN
..........................................
SECOND
DEFENDANT
Coram:
WEPENER
J
Heard
:
26
August 2013
Delivere
d
:
28
August 2013
Summary:
Action for damages – previous action in which damages claimed –
same cause of action – once and for all rule
applicable to
second claim – cannot again claim damages on a second or third
occasion
Prescription – commences to run upon cancellation
of agreement when breached.
J U D G M E N T
WEPENER J:
[1] The plaintiff instituted an
action against the first defendant in which action it claims damages
arising out of the breach and
consequent cancellation of a lease
agreement. The second defendant is sued as surety and I need say no
more about the second defendant
in that capacity by virtue of the
conclusion reached by me herein.
[2] The defendants pleaded two
special pleas – the first that the claim had become prescribed
and the second, that the plaintiff
has already successfully claimed
damages from the first defendant and that the plaintiff is
consequently precluded by the once
and for all rule from claiming
further damages on the same cause of action, i.e. the breach of the
lease agreement and its subsequent
cancellation.
[3] Prior to the trial commencing
the defendants served an application pursuant to Uniform rule 33(4)
in which the defendants’
special pleas were sought to be
disposed of separately from all other issues. Although the plaintiff
initially opposed such separation,
the parties agreed that no
evidence would be necessary in order to determine these two issues
and that reference by them to a limited
number of documents would
suffice in order for a court to determine the two special pleas. As a
result, and having been of the
view that the two issues could indeed
be conveniently dealt with separately, I granted an order that the
special pleas be heard
separately.
[4] The claim for damages arose
against the first defendant, who was a tenant in a building, pursuant
to a written lease agreement.
[5] It is common cause that the
lease agreement was cancelled by the plaintiff on 6 March 2009 due to
a breach of the agreement
by the first defendant. This cancellation
occurred more than three years before the service of the summons in
this matter and this
fact forms the basis of the first special plea
that the plaintiff’s claim has become prescribed.
[6] Of further relevance is the
fact that the plaintiff brought an application against the first
defendant during 2009, which application
was based on the same lease
agreement between the parties and the plaintiff relied on the breach
and cancellation of the lease
which occurred on 6 March 2009. The
plaintiff claimed arrear rental up and until the date of such
cancellation and also claimed
damages for holding over on the basis
that the first defendant remained in occupation of the premises
subsequent to the cancellation
of the lease agreement. The plaintiff
also sought ejectment of the first defendant from the premises. The
plaintiff succeeded with
all its aforesaid claims and judgment in its
favour was delivered on 24 March 2010. Shortly thereafter the first
defendant vacated
the premises.
[7] It is common cause that a
portion of the claim was for damages for holding over by the first
defendant. The plaintiff claimed
an amount ‘being the amount
owing in respect of damages suffered by the applicant [plaintiff] as
a result of the first respondent’s
[first defendant’s]
unlawful holding over of the leased premises…’ I refer
to this litigation as the first application.
[8] Thereafter, and during April
2010, the plaintiff launched a second application (the second
application) in which the it sought
payment of damages from the first
defendant for a further period during which it was alleged that the
defendant was holding over
the premises until it vacated the
premises. The second application was settled and the first defendant
agreed to make payment to
the plaintiff. The terms of the settlement
agreement included the following:
‘
Nothing
contained in this agreement shall preclude the applicant or the first
respondent from instituting proceedings against the
other in respect
of any other claims that either party may have against the other
arising out of or relating to the first respondent’s
occupation
of Block A and B, Richmond Forum, Corner Napier Avenue and Cedar
Road, Richmond.
’
[9] The present action is the
third proceeding instituted by the plaintiff against the defendants
in which it now claims payment
of ‘contractual damages’
suffered by it in respect of the period from the date of vacation of
the premises by the first
defendant until the date upon which the
lease would have expired but for the cancellation thereof by virtue
of the first defendant’s
breach of thereof. The claim, as
formulated, gave rise to the second special plea.
[10] The defendants’ second
special plea is based on the fact that despite already having claimed
damages in the previous
applications the plaintiff again claims
further damages arising out of the cancellation of the agreement,
which it is not entitled
to do.
[11] The plaintiff replicated to
these special pleas, relying on the provisions of clauses 26.2. to
26.4 of the lease agreement
in an attempt to avoid both special
pleas. In order to deal with the breach clause contained in the
agreement I need to set out
the relevant portions thereof.
’
26. Breach
26.1 Should the Lessee:
26.1.1 fail
to pay any amount due by it in terms of this lease to the Lessor on
due date or within 7 (seven) days of that due date;
or
26.1.2 commit
any other breach of any term of this lease, whether such breach goes
to the root of the lease or not, and fail to
remedy that breach
within a period of 7 (seven) days after the giving of written notice
to that effect by the Lessor; or
26.1.3 breach
any of the terms of this lease and the thereafter again breach any
term of this lease (whether the same term which
was breached on the
previous occasion or otherwise) within a period of 12 (twelve) months
after the earlier breach aforesaid; or
26.1.4 commit
any act of or akin to the act of insolvency as contemplated in the
Insolvency Act, 1936(Act 24 of 1936);
then
and in any such event the Lessor shall be entitled, without prejudice
to any other rights which it may have under this lease
or at common
law:
26.1.5 to
cancel this lease on written notice thereof to the Lessee and claim
immediate repossession of the Premises; and
26.1.6 to
claim all damages (including consequential damages) which the Lessor
may suffer together with the interest thereon at
the rate referred to
in clause 26.5; or
26.1.7 …
26.1.8 …
26.2 While
the Lessee remains in occupation of the Premises and irrespective of
any dispute between the parties, including, but
not being restricted
to a dispute as to the Lessor’s rights to terminate this leas
the –
26.2.1 Lessee
shall continue to pay all amounts due to the Lessor in terms of this
lease on the due dates;
26.2.2 Lessor
shall be entitled to recover and accept such payments;
26.2.3 acceptance
by the Lessor of such payments shall be without prejudice to and
shall not in any manner whatsoever affect the
Lessor’s right to
terminate this lease or to claim any damages whatsoever.
26.3 Should
the dispute between the Lessor and the Lessee be determined in favour
of the Lessor, the payments made to the Lessor
in terms of this
clause 26 shall be regarded as amounts paid by the Lessee in respect
any loss and/or damages sustained by the
Lessor as a result of the
breach.
’
[12] In particular, it is the
plaintiff’s case that the two previous proceedings did not
prevent the present claim because
in the first application it sought
arrear rental and charges that had fallen due prior to the date of a
cancellation and it sought
payment of amounts that had fallen due
from month to month in terms of clause 26.2.1 of the lease agreement
from date of cancellation
of the agreement until September 2009. In
the second application it also sought payment of the amounts that had
fallen due for
payment from month to month under clause 26.2.1 for
the period October 2009 until April 2010.
[13] The plaintiff argues that in
the present action it claims payment of contractual damages suffered
by it in respect of the period
from the date on which the defendant
vacated the premises until the date on which the lease would have
expired but for the cancellation
of the lease. It was further argued
that this claim for these contractual damages only arose when the
first defendant vacated the
premises and that the claim has thus not
become prescribed.
[14] In essence, counsel for the
plaintiff argued that the claim for the contractual damages is
something different from the relief
claimed in the previous
litigation.
[15] To test this proposition one
has to consider the provisions of clause 26 of the agreement. The
approach to be adopted when
interpreting a contract is well settled
in our law. In
Coopers
and Lybrand and Others v Braynt
[1995] ZASCA 64
;
1995 (3) SA 761
(AD) Joubert JA said at 768A-E:
‘
The
correct approach to the application of the “golden rule”
of interpretation after having ascertained the literal
meaning of the
word or phrase in question is, broadly speaking, to have regard:
(1)
to the context in which the word or phrase is used with its
interrelation to the contract as a whole, including the nature
and
purpose of the contract, as stated by Rumpff CJ supra;
(2)
to the background circumstances which explain the genesis and
purpose of the contract, ie to matters probably present to
the minds
of the parties when they contracted. Delmas Milling Co Ltd v Du
Plessis1955 (3) SA 447 (A) {dicta at 454G-H & 455A-C
appl} at
454G-H; Van Rensburg en Andere v Taute en Andere1975 (1) SA 279 (A)
{dicta at 303A-C & 305C-E appl} at 305C-E; Swart's
case supra at
200E-201A & 202C; Shoprite Checkers Ltd v Blue Route Property
Managers (Pty) Ltd and Others1994 (2) SA 172 (C)
{dictum at 180I-J
apply} at 180I-J;
(3)
to apply extrinsic evidence regarding the surrounding circumstances
when the language of the document is on the face of it
ambiguous, by
considering previous negotiations and correspondence between the
parties, subsequent conduct of the parties showing
the sense in which
they acted on the document, save direct evidence of their own
intentions. Delmas Milling case at 455A-C, Van
Rensburg's case at
303A-C, Swart's case at 201B, Total South Africa (Pty) Ltd v Bekker
NO1992 (1) SA 617 (A) {dictum at 624G appl}
at 624G, Pritchard
Properties (Pty) Ltd v Koulis1986 (2) SA 1 (A) {dictum at 10C-D appl}
at 10C-D.’
Paragraphs 2 and 3 of Joubert
JA’s summary are not applicable as there are no surrounding
circumstances nor for that matter
anything that is ambiguous in the
clause nor did either party argue that there is ambiguity in clause
26. However, seen in its
context, clause 26.2 is an interim measure
to protect the lessor during the time that a dispute may exist
between the parties.
It provides for damages to be paid for holding
over by the lessee.
[16] Clause 26 of the lease
agreement is headed ‘Breach’ and what follows in that
clause is relevant to a breach of
the lease agreement. Summarised,
clause 26.1 provides that ‘should the Lessee (breach the
agreement) then…the Lessor
shall be entitled…to cancel
this lease agreement…and to claim all damages (including
consequential damages) which
the Lessor may suffer…’ The
parties are ad idem that the provisions of clause 26.1.7 and 26.1.8
are not applicable
to the dispute.
[17] So far the clause gives no
difficulty and none was argued to exist. However, counsel for the
plaintiff argued that after the
cancellation of the agreement the
plaintiff was by virtue of the provisions of clause 26.2 obliged to
sue the first defendant
for monthly amounts whilst the first
defendant remained in occupation. Counsel for the plaintiff went
further and argued that the
provisions of clause 26.2 precluded the
plaintiff from instituting action against the defendant for
consequential damages until
the first defendant vacated the premises.
[18] These arguments are premised
on an incorrect reading of clause 26 in general and clause 26.2 in
particular. Clauses 26.1.5
and 26.1.6 specifically provide that the
plaintiff’s right to recover all damages, including
consequential damages, arises
upon cancellation of the agreement.
That is the date when the debt becomes due and claimable. That date
is not extended by virtue
of the provisions of clause 26.2 of the
agreement. Clause 26.2 provides that the plaintiff was entitled to
accept interim payments
whilst the defendant remained in occupation.
It was not obliged to do so. It was also not prevented from
instituting action for
all its damages as provided for in clause
26.1.6 of the agreement.
[19] I am of the view that
provisions of clause 26.2 were inserted as an interim measure to
provide for payment whilst the parties
are in a dispute regarding,
inter alia, the plaintiff’s right to terminate the lease. This
in fact happened in the first
application in that the defendant
disputed the right of the plaintiff to terminate the agreement.
Clause 26.2 then provides for
interim payments pending the outcome of
such a dispute. The amounts so paid would eventually be taken into
account in determining
any damages suffered by the plaintiff should
the dispute be determined in favour of the plaintiff. Clause 26.3
provides that such
amounts should be regarded as amounts paid by the
lessee in respect of any loss or damages suffered by the plaintiff.
Interim payments
would, no doubt, reduce any claim for damages which
the plaintiff may have.
[20] The argument that the
plaintiff was obliged to recover damages on a monthly basis whilst
the defendant was in possession of
the property and thus the
plaintiff was prevented from instituting action for its contractual
damages, cannot be sustained. Damages
for holding over is nothing
other than damages ex contractu. See
Matz
v Simmonds’ Assignees
1915 CPD 34
;
Du Toit v
Vorster
1928 TPD 385
at 389;
Pangbourne
Properties Ltd v Pulse Moving CC and Another
2013 (3) SA 140
(GSJ) at para 21. See also the discussion in Cooper:
Landlord and Tenant 2
nd
Ed p233-234.
[21] In the circumstances the
first application as well as the second application included claims
for amounts for damages pursuant
clause 26.2 which amounts were
awarded by the court, and in the second application agreed between
the parties, as a result of the
damages which the plaintiff suffered
due to the first defendant’s holding over of the premises.
[22] The question that arises
from the above is whether the plaintiff is entitled to institute
these proceedings if regard is had
to the provisions of clause 26 and
more specifically the provisions of clauses 26.1.5, 25.1.6 and 26.2
as read with 26.3. This
question arises by virtue of the once and for
all rule.
[23] This rule has the effect
that a plaintiff may only claim damages once for all damages based on
a single cause of action. A
party with a single cause of action must
claim damages which flow from that cause of action in one action. Van
Winsen AJA (as he
then was) said in
Custom
Credit Corporation (Pty) Ltd v Shembe
1972 (3) SA 462
(A) at 472A-E:
‘
The
law requires a party with a single cause of action to claim in one
and the same action whatever remedies the law accords him
upon such
cause. This is the ratio that underlines the rule that, if a cause of
action has previously been finally litigated between
the parties,
then a subsequent attempt by the one to proceed against the other on
the same cause of action for the same relief
can be met by an
exception rei judicatae vel litis finitae. The reason for this rule
is given by Voet, 44.2.1 (Gane’s translations,
Vol 6, p553) as
being “to prevent inextricable difficulties arising from
discordant or perhaps mutually contradictory decisions
due to the
same suit being aired more than once in difference judicial
proceedings.” This rule is part of the very foundation
of our
law and is of equal application to the criminal law – in
support of a plea of autrefois acquit (see, eg, Rex v Manasewitz,
1933 AD 165
at pp. 168, 176, 184-187) – as it is to civil
claims for damages resulting from negligent acts (see, eg, Cape Town
Council
v Jacobs,
1917 AD 615
at p. 620; Oslo Land Company Limited v
the Union Government
1938 AD 584
at p. 591) and to claims arising out
of a breach of contract (see, eg, Kantor v Welldone Upholsters,
1944
CPD 388
at p.39; Boshoff v Union Government,
1932 TPD 345).
The rule
has its origins in considerations of public policy which require that
there should be a term set to litigation and that
an accused or
defendant should not be twice harassed upon the same cause.
’
[24] Apart from this rule, there
is a further requirement that a plaintiff pursuing his remedies upon
the basis of the termination
of a contract, must at one and the same
time sue for all the relief which he claims to be due to him. In
dealing with this further
aspect, after having stated the aforesaid
once and for all principle, Van Winsen AJA said the following in
Custom Credit
Corporation (Pty) Ltd v Shembe
supra at 472E-F:
‘
Apart
from these considerations – which are of equal application in
the circumstances present – there are others which
underscore
the requirements that the plaintiff-seller, pursuing his remedies
upon the basis of the termination of the agreement,
must at one and
the same time sue for all the relief which he claims to be due to
him.
’
[25] A cause of action exists if
all of its requirements or elements (the facta probanda) are present.
At this stage, prescription
commences to run (see
HMBMP
Properties (Pty) Ltd v King
1981 (1) SA 906
(N) at 909.
[26] In a claim for damages
arising out the breach of contract, the plaintiff may claim damages
for all the damage flowing from
the cause of action. He or she must
claim, in a single action, compensation for all the damage he or she
has already suffered and
the prospective loss which he reasonably
expects to suffer in the future. In
Coetzee
v SA Railways & Harbours
1933 CPD 565
, Gardner JP (with whom Watermeyer J concurred) examined
the English cases and said:
‘
The
cases, as far as I have ascertained, go only to this extent, that is
a person who sues for accrued damages, must also claim
prospective
damages, or forfeit them.
’
Such a party cannot bring a
further action for any further damage he or she may discover after
the date when he or she obtained
judgment.
Kantor
v Welldone Upholsters
1944 CPD 388
at 391.
[27] A plaintiff is not permitted
to bring more than one action for damages on the same cause of action
(i.e. he cannot ‘take
two bites at the same cherry’). The
reason of this rule was stated by Brand JA in
Symington
v Pretoria-Oos Privaat Hospitaal Bedryfs
(Pty) Ltd
2005 (5) SA 550
(SCA) at 563:
‘
This
rule is based on the principle that the law requires a party with a
single cause of action to claim in one and the same action
whatever
remedies the law presents upon such case. Its purpose is to prevent a
multiplicity of actions based upon a single cause
of action and to
ensure that there is an end to litigation.
’
[28] The key to deciding whether
the rule applies in a particular case is the concept of a ‘cause
of action.’ In
Evins
v Shield Insurance Co Ltd
1980 (2) SA 814
(A), Corbett JA examined the concept by saying at
845A-B:
‘
The
concept of a cause of action – and the question whether claims
constitute parts of a single cause of action or separate
causes of
action – are of particular significance in regard to the
application of the so-called “once and for all”
rule and
also in connection with the related questions of res judicata and
prescription.
’
[29] The amount of R750,298.04
claimed in the first application was for damages for holding over
owing to the plaintiff by the first
defendant in terms clause 26.2 of
the lease agreement, which had become due after cancellation of the
lease on 6 March 2009 until
September 2009. The second application
sought damages for holding over from October 2009 to the end of April
2010 when the first
defendant vacated the premises. These amounts did
constitute damages arising from the cancellation of the lease as
provided for
in the lease agreement.
[30] The once and for all rule
was extensively discussed and explained in
Janse
van Rensburg & Others NNO v Steenkamp & Another
2010 (1) SA 649
(SCA) at paras 27-29. Heher JA quoted at 660-661,
with approval, from the judgment in
Brisbane
City Council v Attorney-General from Queensland
[1978] 3 ALL ER 30
(PC) ([1979] AC 411) at 425AC as follows:
‘…
the
appellants invoke this defence in its wider sense, according to which
a party may be shut out from raising in a subsequent action
an issue
which he could, and should, have raised in earlier proceedings. The
classic statement of this doctrine is contained in
the judgment of
Wigram VC in Henderson v Henderson
[1843] EngR 917
;
(1843) 3 Hare 100
, … It
was, in the judgment of the Board (a reference to the judgment in Yat
Tung Co. v Dao Heng Bank
[1975] AC 581)
, there described in these
words (at 590): “…there is a wider sense in which the
doctrine may be appealed to, so that
it becomes an abuse of process
to raise in subsequent proceedings matters which could and therefore
should have been litigated
in earlier proceedings. This reference to
‘abuses of process’ had previously been made … and
their Lordships
endorse it. This is the true basis of the doctrine
and it ought only to be applied when the facts are such as to amount
to an abuse,
otherwise there is a danger of a party being shut out
from bringing forward a genuine subject of litigation.”’
[31] At para 30, Heher JA said:
‘
The
identification with abuse of the process accords with the policy
expressed in the maxim
nemo
debet bis vexari pro una et eadem causa
which underlies the principle of res judicata. As was said in the
National Sorghum 17 case (at 241D-E) the abuse arises when the
same
cause of action is raised
against
a defendant
a second time.
’
The defendant in this matter is
indeed subjected to a damages claim for a third time and the rule
prevents such further claim, both
as a result of the fact that
multiple actions should be disallowed and the fact that all damages,
also prospective damages, should
have been claimed in one action as
was held in
Custom
Credit Corporation (Pty) Ltd v Shembe
supra.
[32] Counsel for the plaintiff
argued that the cause of action in the two previous applications was
entirely different to the cause
of action in the present matter in
that in the former applications it had enforced its rights in terms
of clause 26.2 of the lease
agreement as it was entitled and obliged
to. In the present action, so it was argued, the plaintiff seeks to
recover its common
law contractual damages suffered as a result of
the first defendant’s breach of the lease agreement. I have
already indicated
that both the previous proceedings and these
proceedings are based on the breach of the lease agreement and its
consequent cancellation.
It is the same cause of action in each of
the proceedings upon which the plaintiff relies to claim damages ex
contractu.
[33] Thus, the right to claim
damages accrued on cancellation for a breach. A plaintiff is entitled
to claim all damages, prospective
or otherwise, which arise from the
breach and cancellation. An innocent party must make a decision
whether to claim such damages
as have accrued or are apparent, or
wait and see whether further damages arise. If the innocent party
decides to wait and see,
he or she must be careful not to allow the
period of prescription to run out. But he or she can protect himself
or herself against
this danger by bringing an action for a
declaration of rights (See
Cape
Town Municipality v Allianz Insurance Company Limited
1990 (1) SA 311
(C)) to interrupt the running of prescription. An
action for a declaration of rights and the subsequent action for
damages are
not the same cause of action. (See Christie: The Law of
Contract in South Africa 6
th
Ed at p574.)
[34] The once and for all rule
relieves the defendant of the hardship of not knowing how many times
he will be sued for damages
(or other relief) arising from his one
breach of contract. It imposes on the plaintiff the obligation of
having to decide whether
to claim prospective damages or to wait and
see whether further damages become apparent before claiming. He
cannot, however, claim
in one proceeding certain of the relief
arising out of the cause of action in question and then come back in
another proceeding
to claim further relief arising out of the same
cause of action.
[35] In this case, as at the date
of cancellation, the plaintiff was in a position to claim the very
damages it now claims, being
the amounts due pursuant to the
cancellation of the lease agreement. Accordingly, the damages were
due as at that date and commenced
running in terms of
section 12
of
the
Prescription Act No 68 of 1969
on 6 March 2009.
[36] In the circumstances the
plaintiff’s claim arose and became enforceable on 6 March 2009
upon cancellation of the agreement.
The summons was served more than
three years later. The plaintiff’s claim against the defendant
is unenforceable by virtue
of it having become prescribed as well as
the plaintiff having elected to institute action for damages in the
previous litigation
between the parties. It cannot again claim
damages from the defendant.
[37] The plaintiff argued that
the defendant did not raise this plea in the second application and
indeed the settlement agreement
foreshadows further litigation
between the parties by virtue of the reservation of rights by the
plaintiff. Counsel for the plaintiff
did not go so far as to argue
that the defendants have waived, or are estopped from, the raising of
the legal issue of prescription
and the bar pursuant to the once and
for all rule. There could, in my view, also be no basis for such an
argument.
[38] In the circumstances both
the special pleas of the defendants are upheld and the plaintiff’s
claim is dismissed with
costs, such costs to include the costs
incurred in relation to the application in terms of Uniform
rule
33(4).
W
L WEPENER
Judge
APPEARANCES
PLAINTIFF: J Both SC
Instructed by Kokinis
Inc
FIRST and SECOND
DEFENDANTS: D Fisher SC
Instructed by Blakes
Maphanga Inc