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[2013] ZAGPJHC 249
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Stefanutti Stocks (Pty) Ltd v S8 Property (Pty) Ltd (20088/2013) [2013] ZAGPJHC 249 (23 October 2013)
REPORTABLE
IN THE GAUTENG HIGH COURT
JOHANNESBURG, LOCAL DIVISION
CASE NO: 20088/2013
DATE:23/10/2013
In the matter between
STEFANUTTI STOCKS (PTY)
LTD
........................................................
APPLICANT
and
S8 PROPERTY (PTY)
LTD
........................................................................
RESPONDENT
Coram:
WEPENER J
Heard
:
22
October 2013
Delivered
:
23 October 2013
Summary:
Building
agreement – enforceability of adjudicator’s decision by
court prior to final arbitration – a decision
which is binding
on the parties who shall give effect thereto without delay unless and
until it is revised, requires immediate
implementation thereof.
Accounts between the parties may be revised by future dispute
resolution procedures which have no affect
on the interim enforcement
of the adjudicator’s decision – The agreement and the
rules of adjudication allow for enforcement
of the adjudicator’s
decision as a contractual obligation by a court.
J U D G M E N T
WEPENER J:
[1] The applicant seeks an order compelling the respondent to comply
with its obligations in terms of a building agreement. The
effect of
the order will be one for specific performance by the respondent by
paying amounts determined by an adjudicator to be
due and payable to
the applicant.
[2] The agreement between the parties is a standard written agreement
utilised in the building industry – referred to as
a Joint
Building Contracts Committee (‘JBCC’) Services 2000
Principal Building Agreement (‘the agreement’
or the
‘JBCC agreement’). Clause 40 of the agreement provides
that:
’
40.0
DISPUTE SETTLEMENT
40.1 Should any disagreement
arise between the employer or his principal agent or agents and the
contractor as to any matter arising
out of or concerning this
agreement either party may give notice to the other to resolve such
disagreement.
40.2 Where such disagreements is
not resolved within ten (10) working days of receipt of such notice
it shall be deemed to be a
dispute and shall be submitted to:
40.2.1 Adjudication in terms of
the edition of the JBCC Rules for Adjudication current at the time
when the dispute is declared.
The adjudicator shall be appointed in
terms of such Rules.
40.2.2 No clause.
40.3 The adjudicator’s
decision shall be binding on the parties who shall give effect to it
without delay unless and until
it is subsequently revised by an
arbitrator in terms of 40.5. Should notice of dissatisfaction not be
given within the period in
terms of 40.4, the adjudicator’s
decision shall become final and binding on the parties.
40.4 Should either party be
dissatisfied with the decision given by the adjudicator, or should no
decision be given within the period
set out in the Rules, such party
may give notice of dissatisfaction to the other party and to the
adjudicator within ten (10) working
days of receipt of the decision
or, should no decision be given, within ten (10) working days of
expiry of the date by which the
decision was required to be given.
40.5
A dispute which is the subject of a notice of dissatisfaction shall
be finally resolved by the arbitrator as stated in the
schedule.
Where such person is unwilling or unable to act, or where no person
has been stated, the arbitrator shall be chosen and
appointed by
mutual agreement within ten (10) working days of such notice, the
arbitrator shall be the person appointed at the
request of either
party by the chairman, or his nominee, of the Association of
Arbitrators (Southern Africa). The adjudicator appointed
in terms of
40.2.1 shall not be eligible for appointment as the arbitrator.
’
[3] The applicant, being the building contractor, referred a dispute
between the parties to an adjudicator. The adjudicator issued
his
decision in terms of which he determined:
‘
3.1
The Contractor is entitled to be paid the full original preliminaries
value of R2,439,677.98;
3.2 Any adjustment to the
preliminaries, in terms of clause 32.12, must be quantified using the
original preliminaries value of
R2,439,677.98;
3.3 The Contractor is entitled
to recover from the Employer the amount of R94,000.00 (excl. VAT)
that has been unlawfully deducted
from the recovery statement and
payment certificate issued by the principal agent;
3.4 The Contractor is entitled
to compensatory interest on all amounts determined to be owing to it
pursuant to this adjudication;
which interest is to calculated from
the date of practical completion, namely 30 July 2012;
3.5 The Employer is, in terms of
Rule 6.4.10 of the JBCC Adjudication Rules, liable in full for the
payment of my fees.’
[4] The respondent, the employer, contended that it is not obliged to
give effect to the adjudicator’s decision as it had
given
notice of its dissatisfaction therewith pursuant to clauses 40.3 to
40.5 of the agreement:
[5] Adjudication was first
introduced in the United Kingdom through the Housing Grants
Construction and Regeneration Act 1996 (‘the
Housing Act’).
The Housing Act provides for an accelerated process for deciding
disputes. It provides in particular that
an adjudicator’s
decision may be rejected by either party and submitted to arbitration
but it is provisionally binding on
the parties unless and until
overturned in the subsequent arbitration. The enforcement of an
adjudicator’s decision and the
referral of the dispute to
arbitration is dealt with in England and Wales by a scheme
promulgated as regulation 1998 which is quoted
in the judgment of the
Queen’s Bench Division in
Carillion
Construction Ltd v Devonport Royal Dock Yard
[2005]
EWHC 778
(TCC) at para 6. The relevant regulation provides that:
‘
The
decision of the adjudicator shall be binding on the parties and they
shall comply with it until the dispute is finally determined
by legal
proceedings, by arbitration…or by agreement between the
parties’.
[6] At para 59 of
Carillion
,
and discussing the law, the court explained the purpose of
adjudication as follows:
‘
It was
to introduce a speedy mechanism for settling disputes in construction
contracts on a provisional interim basis and requiring
the decisions
of adjudicators to be enforced pending final determination of
disputes by arbitration, litigation or agreement.’
In
Carillion
at para 80 the court found that even errors of procedure, fact or law
by the adjudicator did not constitute defences to the enforcement
of
the adjudicator’s decision.
[7] In South Africa adjudication has found its way into major
construction agreements, such as the JBCC agreement, and is regulated
contractually. The purpose, however, of the two procedures and the
enforcement of the adjudicator’s decision are, in my view,
similar.
[8] Eyvind Finsen
The
Building Contract - A commentary on the JBCC Agreements
,
2 ed p 229 explains the enforcement of the adjudicator’s
decision as follows:
‘
The
purpose of adjudication being the quick, if possible temporary,
resolution of a dispute and the granting of interim relief to
the
successful party, the whole purpose of adjudication would be
frustrated if the successful party was unable to enforce the
determination against the other party.’
[9] In a recent judgment of
Tubular Holdings (Pty)
Ltd v DBT Technologies (Pty) Ltd
(06757/2013)
[2013] ZAGPJHC 155 (3 May 2013) delivered in this division, DTvR Du
Plessis AJ interpreted the following contractual
provision:
‘
The
decision shall be binding on both parties who shall promptly give
effect to it unless and until it shall be revised in an amicable
settlement or an arbitrated award as described below.’
Du Plessis AJ said:
‘
[8]
The effect of these provisions is that the decision shall be binding
unless and until it has been revised as provided. There
can be no
doubt that the binding effect of the decision endures, at least,
until it has been so revised. It is clear from the wording
of clause
20.4 that the intention was that a decision is binding on the parties
and only loses its binding effect if and when it
is revised. The
moment the decision is made the parties are required to “promptly”
give effect to it. Given that a
dissatisfied party has 28 days within
which to give his notice of dissatisfaction it follows that the
requirement to give prompt
effect will precede any notice of
dissatisfaction.
[9] The final sentence of clause
20.4 (4), requiring the contractor to continue to proceed with the
works, underscores the intention
of the parties to the effect that
life goes on and is not interrupted by a notice of dissatisfaction.
[10] A dissatisfied party may
elect to wait 28 days before giving his notice of dissatisfaction.
However, this will have no effect
on his obligation to give effect to
the decision which has to happen promptly on the giving of that
decision. In the event where
no notice of dissatisfaction has been
given within the prescribed time, the decision becomes final and
binding on both parties.
[11] The distinction between the
situation in clause 20.4 (4), where the decision shall be binding on
both parties and clause 20.4
(7), where it becomes final and binding
upon both parties is significant: in the first instance it is binding
but of an interim
nature (but the obligation to perform in terms of
this decision is final); in the second it is binding but now finally
so.
[12] Where no notice of
dissatisfaction had been given the decision becomes final and
binding. Clause 20.6 (1) is concerned only
with a decision in respect
of which a notice of dissatisfaction has in fact been given. In other
words, this is a situation envisaged
in clause 20.4 (4): the decision
is binding on both parties who must promptly give effect to it unless
and until it has been revised
in an arbitral award as referred to in
clause 20.6 (1). Clause 20.6 (1) obviously only arises if there had
indeed been a notice
of dissatisfaction.
[13] Thus the notice of
dissatisfaction does not in any way detract from the obligation of
the parties to give prompt effect to
the decision until such time, if
at all, it is revised in arbitration. The notice of dissatisfaction
does, for these reasons, not
suspend the obligation to give effect to
the decision. The party must give prompt effect to the decision once
it is given.
[14] The scheme of these
provisions is as follows: the parties must give prompt effect to a
decision. If a party is dissatisfied
he must nonetheless live with it
but must deliver his notice of dissatisfaction within 28 days failing
which it will become final
and binding. If he has given his notice of
dissatisfaction he can have the decision reviewed in arbitration. If
he is successful
the decision will be set aside. But until that has
happened the decision stands and he has to comply with it.
[15]
In the unreported decision of
Esor
Africa (Pty) Ltd/Franki Africa (Pty) Ltd JV and Bombela Civils JV
(Pty) Ltd
,
SGHC case no. 12/7442, the parties had referred a dispute to the DAB
in terms of clause 20.4 of the FIDIC Conditions of Contract.
The DAB
gave its decision which was in favour of the contractor. The employer
refused to make payment in terms of the decision
relying, inter alia,
on the fact that it had given a notice of dissatisfaction and the
contractor approached the Court for an order
compelling compliance
with the decision.
[16] The matter came before
Spilg J who commented that he found the wording of the relevant
contractual provisions to be clear and
that their effect is that
whilst the DAB decision is not final
“
the
obligation to make payment or otherwise perform under it is…”
(at para 12 of the judgment)
[17] The court found the key to
comprehending the intention and purpose of the DAB process to be the
fact that neither payment nor
performance can be withheld when the
parties are in dispute (at para 12):
“
the
DAB process ensures that the quid pro quo for continued performance
of the contractor’s obligations even if dissatisfied
with the
DAB decision which it is required to give effect to is the employer’s
obligation to make payment in terms of a DAB
decision and that there
will be a final reconciliation should either party be dissatisfied
with the DAB decision…”
[18] The court further held at
para 14 that the respondent was not entitled to withhold payment of
the amount determined by the
adjudicator and that he
“
is
precluded by the terms of the provisions of clause 20 (and in
particular clauses 20.4 and 20.6) from doing so pending the outcome
of the Arbitration.”
[19]
Mr Burman SC, who appeared for the respondent, criticized the
Bombela
-decision
on the basis that the court did not refer to any authority in the
judgment. In this regard the learned Judge said the
following:
“
I have
considered a number (of) local and foreign cases that were dealt with
in argument. In my view this is a straight forward
case based on the
reading of the contract and the underlying rationale for requiring
the immediate implementation of the DAB decision.”
[20]
I am bound to give effect to the judgment in
Bombela
“
unless
the Court is completely satisfied that such previous decision is
wrong, and has been arrived at by some manifest oversight
or
misunderstanding, and that a palpable mistake has been made.”
[
R
v Phillips Dairy (Pty) Ltd
1955
(4) 120 (T) at 122C]
[21]
I cannot make such a finding. Far from being “clearly wrong”
the
Bombela
judgement
is, in my view, correct: the Court had regard to the relevant
authorities applicable to the construction of contracts
and then
looked at the wording of the contract and concluded, quite correctly,
that such wording is clear. That was the correct
approach.
[22]
The decision in
Bombela
is
supported by a number of judgments, both here and abroad, dealing
with similar provisions in different standard forms of construction
contracts which point clearly to a practice relating to the immediate
enforcement of an adjudicator’s decision leaving it
to the
dissatisfied party to refer the decision to arbitration in order to
set it aside; until so set aside it remains binding.
[23] Evidence of this approach
is relevant on two bases: firstly, it assists in the interpretation
of the relevant contractual provisions,
and secondly it is material
which would have been present in the mind of the parties when they
contracted and thus admissible as
evidence of background
circumstances.
[24] Some of the relevant cases
are the following:
24.1
Stocks and
Stocks (Cape) (Pty) Ltd v Gordon and others NNO
1993
(1) SA 156
(T):
24.1.1 The contract in this
matter, which appears to have been an ad-hoc agreement, (which had
been concluded during the 1980’s)
referred to mediation as
opposed to adjudication. It provided that the parties could obtain
the opinion of a mediator but if dissatisfied,
it could refer it to
arbitration. It provided that
“
The
opinion of the mediator shall be binding upon the parties and shall
be given effect to by them until the said opinion is overruled
in any
subsequent arbitration or litigation.”
24.1.2
Van Dijkhorst J disagreed with the previous dissenting decision in
Blue Circle
Projects (Pty) Ltd v Klerksdorp Municipality
1990
(1) SA 469
(T) as being clearly wrong and could find no objection to
giving effect to an agreement in terms of which interim payments are
to be made which may later be followed by an adjustment of account
and a claim for repayment of what has been paid should the opinion
be
set aside in arbitration: after all, that is the effect of the
agreement.
24.2
Freeman NO and
another v Eskom Holdings Limited
[(43346/09)
[2010] ZAGPJHC 137 (24 April 2010); (2011 JDR 0226 (GSJ);
[2010] JOL
25357
(GSJ)]:
24.2.1 In this matter
Kathree-Setiloane AJ (as she then was) considered the NEC form of
contract, which provides for adjudication
and for notification by the
dissatisfied party to a tribunal who has the power to settle the
dispute referred to it. It also provides
that the adjudicator’s
decision is binding upon the parties “unless and until”
revised by the tribunal and is
enforceable as a matter of contractual
obligation between the parties and not as an arbitral award.
24.2.2 In this matter the
contractor had obtained an adjudicator’s decision in its
favour. It issued summons against the employer
based on this
decision. The employer entered appearance whereupon the contractor
applied for summary judgment.
24.2.3 Summary judgment was
resisted, inter alia, on the grounds that the employer had given
notice of dissatisfaction. The Court
held that this did not
constitute a bona fide defence to the claim as the adjudicator’s
decision is final and binding unless
and until revised by the
tribunal.’ [at paras 16 and 17]
‘
24.3
Basil
Read (Pty) Ltd v Regent Devco (Pty) Ltd
(41108/09)
[201] ZAGPJC 75 (9 March 2010):
24.3.1 Clause 40 of the JBCC
Principal Building Agreement deals with dispute resolution and allows
a referral of a dispute to an
adjudicator. Any party dissatisfied
with the adjudicator’s decision may give notice of
dissatisfaction within a stipulated
time and may then refer the
dispute to arbitration. The arbitrator shall have the power to reopen
any previous decision including
that of the adjudicator. It
stipulates, however, that
“
the
adjudicator’s decision shall be binding upon the parties who
shall give effect to it without delay unless and until it
is
subsequently revised by an arbitrator”.
24.3.2 In this matter, which was
also decided in this division, Mokgoatlheng J construed these
provisions as imposing an obligation
on the dissatisfied party to
give effect to the decision without delay unless and until it is
subsequently set aside by the arbitrator.
The dissatisfied party’s
remedy is to procure set-off or adjustment in the following payment
certificates should he succeed
in having the decision set aside after
he had performed.
24.4
The United
Kingdom:
24.4.1 Here the matter is now
dealt with by statute which is to the same effect as the clauses
referred to above.
24.4.2
In commenting on the statutory scheme the Court of Appeal remarked in
paragraph 87 [of
Carillion
]
that
“
In
short, in the overwhelming majority of cases, the proper course for
the party who is unsuccessful in an adjudication under the
scheme
must be to pay the amount that he has been ordered to pay by the
adjudicator. If he does not accept the adjudicator’s
decision
as correct (whether on the facts or in law), he can take legal or
arbitration proceedings in order to establish the true
position. To
seek to challenge the adjudicator’s decision on the ground that
he has exceeded his jurisdiction or breached
the rules of natural
justice (save in the plainest cases) is likely to lead to a
substantial waste of time and expense –
as, we suspect, the
costs incurred in the present case will demonstrate only too
clearly.”
24.4.3 It seems that the
underwhelming minority which the Court of Appeal had in mind is where
the adjudicator simply answered the
wrong question rendering his
decision a nullity. However, this is not the respondent’s
complaint in this case.
[25] I therefore find that the
terms of the relevant contractual provisions are perfectly clear: the
parties are obliged to promptly
give effect to a decision by the DAB.
The issue of a notice of dissatisfaction does not in any way detract
from this obligation;
whilst such a notice is necessary where the
dissatisfied party wishes to have the decision revised it does not
affect that decision;
it simply sets in motion the procedure in which
the decision may be revised. But until revised, the decision binds
the parties
and they must give prompt effect thereto.
[26]
Any room for doubt regarding the interpretation of these provisions
was laid to rest by the judgment of this court in
Bombela
.
This court has declared that a notice of dissatisfaction does not
excuse performance by the party giving such notice from giving
effect
to the decision in the interim.
[27] The wording of the
provisions in question is entirely consistent with other forms of
contract and are indicative of a practice
currently existent in the
construction industry to the effect that dissatisfied parties are
required to give prompt effect to the
decisions of adjudicators in
question despite their notices of dissatisfaction; those notices
merely allow a possible revision
of these decisions without affecting
their interim binding nature.’
[10] I am in respectful agreement
with the reasoning of Du Plessis AJ. The words ‘without delay’
and ‘unless and
until’ reflect an intention that effect
be given to the adjudicator’s decision until it is set aside by
an arbitrator.
In the
Basil
Read
matter,
Mokgoatlheng J dealt with a clause in similar terms as the clause now
under consideration when he concluded that the adjudicator’s
decision was enforceable, despite a future arbitration. Spilg J said
in
Bombela
at paras 11 and 12:
‘
The
DAB decision is not final but the adjudication to make payment or
other performance under it is …The key to comprehending
the
intention and purpose of the DAB process is that neither payment nor
performance can be withheld when the parties are in dispute.’
[11] The terms of the Rules for Adjudication (‘Rules’),
to which both parties were bound, were common cause. Adjudication
Rule 7.1.4 reads:
‘
7.1
The adjudicator’s written determination of the dispute shall:
7.1.1 …
7.1.2 …
7.1.3 …
7.1.4 Be binding on the parties
unless and until such determination is overturned or reviewed in
whole or in part by arbitration
in terms of clause 40.5 of the
agreement.’
In addition, in clause 7.2.2 the
Rules provide that ‘
either party may apply to court for
the enforcement of the determination as a contractual obligation
’.
The determination that can be referred to court for enforcement, is
the decision of the adjudicator.
[12] The respondent relied on a
passage in
Blue Circle
Projects (Pty) Ltd v Klerksdorp Municipality
1990
(1) SA 469
(T) where it was held that the decision of the adjudicator
being interim in nature, cannot be enforced as only a final award can
be enforced by a court. However, van Dijkhorst J said in
Stocks
& Stocks
at 160E:
‘
The
statement by the learned Judge that only a final arbitration award
will be enforced by an order of Court is no doubt correct
as a
general proposition. Compare
Britstown
Municipality v Beunderman
(Pty)
Ltd1967 (3) SA 154 (C). It must surely, however, be qualified to
exclude instances where the contract clearly stipulates that
an
amount is due and payable. Ubi ius ibi remedium.
I
have therefore come to the conclusion that the decision in
Blue
Circle Projects (Pty) Ltd v Klerksdorp Municipality
(supra)
is clearly wrong and decline to follow it.’
The wording of the agreement
between the parties in this matter is that the decision is binding
and must be implemented without
delay and the
Britstown
Municipality
case is
distinguishable on that basis. It is also distinguishable as a result
of the fact that no contractual right to enforce
the decision (prior
to further decisions being taken) was included in the agreement
considered in
Britstown
Municipality
. Nor did
it contain a clause such as clause 7.2.2 of the Rules in this matter.
[13] In the circumstances, having regard to the clear wording of the
agreement and Rules, the decision of the adjudicator is an
enforceable contractual obligation, at least until it has been
revised, if revised by an arbitrator.
[14] The argument on behalf of the respondent that, because it sent a
notice of dissatisfaction with the decision of the adjudicator,
the
issue is not finally resolved and cannot be enforced by a court, is
consequently without merit.
[15] The respondent’s
further argument was that the reference to arbitration would not
interrupt or suspend the works carried
out in terms of the agreement
and thus frustrate the purpose behind Clause 40 of the agreement to
obtain a speedy resolution of
a dispute and to avoid delay in the
works. This is so as a result of the fact that the agreement had been
terminated, the applicant
is no longer engaged in the works and any
interim payments will not be followed by an adjustment of accounts.
The argument relies
on a passage of van Dijkhorst J in the
Stocks
& Stocks
matter at
160B-D where the learned judge said:
‘
In
principle, I have no objection to giving effect to an agreement in
terms of which interim payments are to be made which may later
be
followed by an adjustment of accounts and a claim for repayment of
what has been paid. There is nothing contra bonos mores in
such
arrangement. In fact, in the instant case it is a practical solution
to ensure continuity of work in progress. The fact that
my order will
lead to execution, should the respondents not comply, is to be
expected. The fact that there cannot be an appeal
or a rescission
solely because an arbitrator has later arrived at a conclusion which
differs from the opinion of the mediator does
not close the door to
the respondents. They will be credited in the final accounts
or
can reclaim the amounts now paid under the order of Court upon a new
cause of action based upon the subsequent arbitrator's award
or, if
there is litigation, the order there made.
’
(My underlining)
The argument on behalf of the
respondent overlooks the underlined portion of the judgment. The
doors are not closed for the respondent
who can take whatever steps
may be necessary, should it be successful in the arbitration
proceedings. The passage in
Carillion
quoted in para 6 above does not hold that the finalisation or
completion of the contract is a cut-off date for the implementation
of the adjudicator’s decision. None of the decided matters
referred to herein suggest that the coming to an end of the works
or
contract, has the affect of preventing any further adjustment of
accounts. Parties can resolve disputes and settle accounts
regardless
of the completion of the contract or the termination of the
agreement.
[16] Having regard to the purpose
of the provisions of the agreement by introducing a speedy settling
of disputes in construction
agreements on a provisional, interim
basis, I can find no reason not to follow the judgment in
Tubular
Holdings
, which is in
harmony with the decisions of Spilg J in
Bombela
and Mokgoatlheng J in
Basil
Read.
The purpose of
the policy to implement the adjudicator’s decision is also to
obviate the tactical creation of disputes with
a view to the
postponement of liability. See Ramsden
The
Law of Arbitration
p59. This is so, despite the termination of the agreement.
[17] Kathree-Setiloane AJ (as she
then was) said in
Freeman
at para 16 and 17 as follows:
‘
[16]
Eskom’s second defence is that, on 20 November 2006 and 4
December 2006 respectively, it notified Transdeco, that it
intended
to refer the first and second decisions of the adjudicator to
arbitration, in terms of the contract and, that the arbitration
of
these disputes is pending. Eskom thus denies that it is obliged to
comply with the first and second decisions of the adjudicator
pending
arbitration. I am of the view that this would not constitute a bona
fide defence that is good in law, as the parties expressly
agreed, in
terms of Core Clause 90.2 of the contract, that an adjudicator’s
‘decision is final and binding unless and
until revised by the
tribunal”.
[17]
The adjudicator’s decision, therefore, remains binding and
enforceable until revised in the final determination by an
arbitrator. Mr Kemack referred me to the United Kingdom case of
Bouygues
(UK) Limited v Dahl-Jensen
(UK)
Limited
[2000] BLR 49
[TCC] at 55, para. 35, which bears out this
conclusion. This matter, of the Queen’s Bench Division,
Technology and Construction
Court (“TCC”), concerned a
dispute arising from a sub-contract, which provided for dispute
resolution by adjudication
pursuant to the Rules of the CIC Model
Adjudication Procedure (2nd edition) which provided that:
“
1.The
object of adjudication is to reach a fair, rapid and inexpensive
decision upon a dispute arising under the contract and this
procedure
shall be interpreted accordingly.
...
4. The Adjudicator’s
decision shall be binding until the dispute is finally determined by
legal proceedings, by arbitration
(if the contract provides for
arbitration or the parties otherwise agree to arbitration) or by
agreement.
5. The parties shall implement
the Adjudicator’s decision without delay whether or not the
dispute is to be referred to legal
proceedings or arbitration.
...”
Having regard to these Rules,
Justice Dyson held as follows:
“
the
purpose of the scheme is to provide a speedy mechanism for settling
disputes in construction contracts on a provisional interim
basis,
and requiring the decisions of adjudicators to be enforced pending
final determination of disputes by arbitration, litigation
or
agreement, whether those decisions are wrong in point of law and
fact. It is inherent in the scheme that injustices will occur,
because from time to time, adjudicators will make mistakes. Sometimes
these mistakes will be glaringly obvious and disastrous in
their
consequences for the losing party. The victims of mistakes will
usually be able to recoup their losses by subsequent arbitration
or
litigation, and possibly even by a subsequent arbitration.”
(See also: C&B Scene Concept Design v Isobars Limited
[2002] BLR
(CA) 93 at 98, para. 23)
’
[18] Spilg J said in
Bombela
at par 12:
‘
The
parties’ position may be altered by the outcome of the eventual
arbitration which is a lengthier process and there may
be a refund
ordered of monies paid or an interest readjustment if too little was
decided by the DAB.
’
[19] In the circumstances, the argument that interim payments may not
be followed by an adjustment of accounts, must fail.
[20] The rate of interest, applicable on any outstanding amounts, was
common cause between the parties and the amounts claimed
by the
applicant pursuant to the decision of the adjudicator were not
disputed.
[21] In the circumstances, as neither of the defences can succeed, I
grant the following order:
21.1 The respondent is ordered to comply with the decision of the
adjudicator as contained in annexure SS08 to the founding affidavit
in the application forthwith by making payment of the amounts of:
21.1.1 R1,689,677.98;
21.1.2 R1,269,810.00;
21.1.3 R94,000.00;
21.1.4 R188,726.31;
21.1.5 R43,500.00;
21.1.6 Interest on the aforesaid amounts calculated at 8% monthly
compounded from 1 May 2013 to date of payment;
21.2 The respondent is to pay the costs of the application.
WEPENER J
JUDGE OF THE
GAUTENG HIGH COURT
JOHANNEBURG LOCAL DIVISION
APPEARANCES
COUNSEL FOR APPLICANT: L.J van Tonder
(Heads drawn by P.H.J van Vuuren)
Instructed by Tiefenthaler Attorneys
COUNSEL FOR RESPONDENT: J.J Bitter
Instructed by Daryl Ackerman Attorneys