About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: South Gauteng High Court, Johannesburg
SAFLII
>>
Databases
>>
South Africa: South Gauteng High Court, Johannesburg
>>
2013
>>
[2013] ZAGPJHC 266
|
|
Rodel Financial Services (Pty) Ltd v Stupel & Berman Inc and Another (2011/43229) [2013] ZAGPJHC 266 (28 October 2013)
NOT REPORTABLE
IN THE SOUTH GAUTENG HIGH COURT OF
SOUTH AFRICA (JOHANNESBURG)
Case No: 2011/43229
DATE:28/10/2013
In the matter between:
RODEL FINANCIAL SERVICES (PTY)
LTD
........................................
Plaintiff
And
STUPEL & BERMAN
INC
…........................................................
1st
Defendant
BERMAN, MICHAEL
….................................................................
2nd
Defendant
JUDGMENT
C. J. CLAASSEN J:
[1] This claim, stripped to its very
bare essentials, was instituted by a financial institution for the
repayment of bridging finance
that it advanced to the seller of
immovable property pending payment of the purchase price and transfer
of the property to the
purchaser. The financial institution issued
summons against the conveyancing attorney arising from a written
instruction to pay
the proceeds of the transaction to the financial
institution (the lender) as opposed to the seller (the borrower).
[2] No evidence was led since the
parties agreed to a stated case upon which their respective
contentions were advanced in argument.
Before dealing with the stated
case, however, it is necessary to deal with some preliminary issues.
THE ROLE PLAYERS
[3] When reading the papers, I found
the references to the various role players somewhat confusing. For my
own sake and that of
the reader of this judgment, I deemed it
appropriate to explain the references to the various dramatis
personae made in the papers.
1. The plaintiff, who issued summons,
is a financial institution known as Rodel Financial Services (Pty)
Ltd (“Rodel”).
In terms of two discounting agreements
dated 31 August 2010 and 2 September 2010, Rodel advanced bridging
finance in the amounts
of R850 000.00 and R550 000.00
respectively to the seller of a certain immovable property. Apart
from differing amounts,
the two discounting agreements were subject
to the same terms and conditions
1
consisting of fifteen clauses. Attached to each agreement is a
schedule headed “SALE PROCEEDS” and “UNDERTAKING
BY
CONVEYANCER”.
2
In the papers Rodel are represented by Tamryn Flowers (“Tammy”),
Tammy Hall
3
,
Chantal Davecharran,
4
and Jacques Morkel.
5
Rodel is also represented by its attorneys of record, Norman Berger
and Partners Inc.
2. Amber Falcon Prop 3 (Pty) Ltd
(“AFP”) is the seller of the immovable property Erf 416
Norwood, situate at corner
of 93 Frances and Grant Road, Norwood, in
extent 991 square metres and held under title deed T31831/2006 (the
“Norwood property”).
This property was sold on auction by
the auctioneers, Alliance Group, on 9 February 2010 for an amount of
R7 200 000.00.
6
AFP is referred to in the documents interchangeably as “the
client” and/or “the seller”. Where necessary
I will
insert in brackets the acronym “AFP” when quoting from
the various documents in order to dispel any confusion
as to who is
being referred to. It was to AFP that Rodel advanced the two amounts
in terms of the two discounting agreements. In
the documents AFP is
represented by Julius Blumenthal, Nathan Blumenthal, Joy Moraine
7
and the first and second defendants. Subsequently AFP employed new
attorneys, i.e. Bieldermans Inc.
3. The purchaser of the Norwood
property at the auction was originally “SHAAHID MAHOMED AKOOB
or NOMINY” (sic).
8
It is common cause that Mr Akoob subsequently nominated Cross
Atlantic Properties 186 (Pty) Ltd as the purchaser.
9
I will refer to Cross Atlantic Properties as “CAP”. In
the papers it was represented by attorneys Ismail Ayob and Partners.
10
4. Mercantile Bank Ltd was the
existing bond holder in terms of a continuing covering mortgage bond
number B2302/2009, registered
against the Norwood property.
11
5. The first defendant is Stupel and
Berman Incorporated who was appointed the conveyancing attorneys, not
in terms of the Auction
Sale Agreement, but subsequent thereto by
AFP. Such appointment is confirmed in the correspondence
12
and the discounting agreements.
13
In the correspondence Stupel and Berman Inc are also referred to as
the “Conveyancer” and interchangeably represented
by
Marietjie de Lange,
14
Mr Michael Berman,
15
Maureen Matthee
16
and David Pretorius.
17
Mr Berman signed the “Conveyancing Undertakings” forming
part of the two discounting agreements.
6. Bieldermans Inc are the second set
of attorneys who acted on behalf of AFP as from approximately
February 2011.
18
THE CONTRACTS
[4] The story began in 2010 when AFP
decided to sell its immovable property in Norwood. As previously
stated, this property had
been bonded by AFP in favour of Mercantile
Bank Ltd during 2009. The property was placed on auction and sold by
the auctioneers
on 9 February 2010 for R7 200 000.00. AFP
expected payment of the net proceeds of the sale in due course, but
pending
that, it required bridging finance, presumably to pay for the
transfer costs. In order to obtain such interim finance, AFP
concluded
the two discount agreements with Rodel on 31 August and 2
September 2010 respectively. Both agreements were in respect of the
sale
of the Norwood property. In each transaction the “proceeds”
of the sale are calculated after deduction of the bond cancellation
amount and other amounts from the sale price of R7 200 000.00.
The sale price of R7 200 000.00 was to be paid
by the CAP
from the proceeds of a new bond in the amount of R6 840 000.00
plus the deposit held in trust in the amount
of R360 000.00
amounting in total to R7 200 000.00.
[5] In the schedule to the first
discount agreement concluded between Rodel and AFP on 31 August 2010,
the net proceeds due to AFP
from the sale of the Norwood property
were calculated as being R2 369 408.00. That amount was, of
course, more than adequate
to secure the repayment by AFP to Rodel of
the latter’s first payment of the bridging finance in the
amount of R850 000.00
plus any discounting fees. These fees were
to be calculated at 0.133% per day, i.e. amounting to R1 130.60
per day.
19
[6] In the schedule to the second
discounting agreement, the net proceeds of the sale were calculated
at a lesser amount of R1 369 408.00
after deduction of a
further undertaking in the amount of R1 000 000.00.
20
Upon this second calculation of the proceeds of the sale, it was
apparent that a further amount of bridging finance could be made
available to AFP. Hence, a further amount of R550 000.00 was
agreed to as a first payment of bridging finance on the second
discounting agreement.
[7] The two first payments in terms of
the discounting agreements amounted in total to bridging finance
advanced to AFP by Rodel
in the amount of R1 400 000.00.
This amount plus discounting fees would still have been less than the
net proceeds of
the sale of the Norwood property, due to AFP.
21
As security for due repayment to Rodel of the R1 400 000.00
plus discounting fees, the two agreements and their schedules
expressly recorded cessions of the proceeds of the sale of the
Norwood property to Rodel in the following terms:
“
By my/our signature of this
Schedule to the Discounting Agreement: I/we acknowledged that I/we
have read, understood and accepted
the Discounting Terms and
Conditions, a copy of which have been made available to me/us, and
I/we hereby cede, transfer and make
over to Rodel my/our right, title
and interest in and to the Proceeds against payment of the First
Payment.”
22
(Emphasis added)
[8] Just immediately below the
aforesaid cession, the schedule was signed on behalf of AFP by Joy
Moraine, on behalf of the conveyancer
by Mr Berman and by someone on
behalf of Rodel whose signature is illegible.
23
[9] In addition, Rodel obtained
further security for the repayment of the amounts plus the
discounting fees advanced, in terms of
a suretyship signed by one of
the directors of AFP, Mr Julius Blumenthal.
24
The suretyship is also attached to the schedule in each of the
discounting agreements.
[10] In order to facilitate repayment
of the amount due to Rodel from the proceeds of the sale, the parties
agreed to an undertaking
by the conveyancer to make payment direct to
Rodel from the net proceeds of the sale of the Norwood property
within 72 hours of
registration of transfer. Such undertaking was
duly signed by Mr Berman on 31 August 2010 in respect of the first
discounting agreement
and on 2 September 2010 in respect of the
second discounting agreement.
25
The terms of this undertaking are as follows:
“
UNDERTAKING BY CONVEYANCER
1. We are currently attending to the
registration of the abovementioned property transfer, arising out of
the sale agreement entered
into between the parties referred to
above.
2. The sale agreement is valid and
enforceable in law and there are, to our knowledge, no attachments or
interdicts registered against
the Property.
3. All suspensive conditions in
respect of the above transfer had been fulfilled, and we know of no
further impediment or encumbrance
that would delay or hinder the
registration of transfer of this transaction.
4. The Client (AFP) has entered into a
discounting agreement with Rodel Financial Services (Pty) Ltd,
whereby Rodel has agreed to
purchase the Proceeds arising from the
above transaction on registration of transfer.
5. The balance owing to the mortgagee
is as set out above.
6. No further undertakings have
been/will be made or given which would reduce the Proceeds on
registration of transfer.
7. We acknowledge that the Client
(AFP) has furnished us with an irrevocable instruction to pay to
Rodel, from the Proceeds, the
full amount payable in terms of the
said discounting agreement for which amount we will request a
settlement quote from Rodel immediately
upon registration of
transfer.
8. We hereby undertake to pay to Rodel
from the Proceeds the above amount within 72 hours of registration of
transfer/receipt of
funds, unless prevented by interdict or operation
of law.
9. We undertake to inform Rodel
forthwith if the Client (AFP) lodges with us a request to uplift this
file, or terminates or attempts
to terminate our mandate to act on
its behalf, which act we understand to be a breach of the agreement
with the Client (AFP).
10. In the event of a cancellation of
the sale for whatsoever reason where the funds provided by Rodel have
been utilised for the
payment of transfer duty or rates and taxes, we
will pay to Rodel all and any monies received in respect of the
refund of transfer
duty or rates and taxes paid, subject to a maximum
amount equal to the first payment together with discounting fees
thereon, if
applicable.
11. We undertake to keep you advised
of all material and important developments in regard to the
transaction.
12. The signatory hereto is
authorised, on behalf of this firm, to bind the firm and its
partners/directors in respect of the above
undertaking.”(Emphasis
added)
[11] As previously stated the
discounting terms and conditions contained fifteen clauses. The
relevant clauses for this case are
the following:
“
INTERPRETATION
1. In this agreement, if applicable,
and unless the context indicates the contrary intention, the words
and expressions recorded
below shall bear the meanings assigned to
them, cognate expressions bear corresponding meanings, and the
provisions of clauses
1.27 to 1.31 shall apply in the interpretation
of this Agreement.
1.1 “Agreement” –
means these Terms and Conditions together with the Schedule as signed
by the Client (AFP) and
Rodel.
1.5 “Bond Settlement Amount”
– means the amount due and payable by the Client (AFP) to the
Mortgagee as at the
Transfer Date to cancel the Mortgage Bond as set
out in the Schedule.
1.7 “Claim” – means:
(i) In the case of a Sale Transaction, the Client’s (AFP) legal
rights to claim payment
of that portion of the Proceeds as is set out
in the Schedule upon the registration of the transfer of the transfer
of the Property
into the name of the Purchaser; and (ii)…
(irrelevant)
1.8 “Client” (AFP) –
means the party who is selling the Claim to Rodel and who is referred
to as such in the Schedule.
1.9 “Conveyancer” –
means: (i) In the case of a Sale Transaction, the person, firm or
entity appointed by the
Client (AFP) to attend to the registration of
the transfer of the Property pursuant to the Sale Agreement in the
appropriate Deeds
Registry, and all matters incidental thereto; and
(ii) … (irrelevant).
1.10 “Discounting Fee” –
means the fee payable by the Client (AFP) to Rodel as calculated and
determined in accordance
with and as set out in the Schedule.
1.11 “First Payment” –
means the initial amount payable by Rodel to the Client (AFP) as set
out in the Schedule.
1.16 “Proceeds” –
means: (i) In the case of a Sale Transaction, the amount realised by
the Client (AFP) from the
sale of the Property to the Purchaser (CAP)
which amount will become due and payable to the Client (AFP) on the
date upon which
transfer of the Property is registered in the name of
the Purchaser, after deducting the Bond Settlement Amount, Agent’s
Commission and any other amounts payable by the Client (AFP) as a
direct result of the sale of the Property as more fully set out
in
the Schedule; and (ii) … (irrelevant).
1.17 “Purchase Price” –
means the consideration payable by Rodel to the Client (AFP) as
determined in accordance
with the terms of this Agreement, for the
Claim, as set out in the Schedule.
1.18 “Purchaser” (CAP) –
means the purchaser of the Property as described in the Sale
Agreement.
1.21 “Sale Agreement” –
means the written agreement between the Client (AFP) and the
Purchaser (CAP) in terms
of which the Client (AFP) sells the Property
to the Purchaser (CAP) thereby giving rise to the Claim.
1.22 “Sale Transaction” –
means the transaction in terms of which a Claim arises pursuant to
the sale by the Client
(AFP) of his immovable property.
1.23 “the Schedule” –
means the Schedule of information relating to the sale of the
Client’s (AFP) Claim
to Rodel, which has been signed by the
Client (AFP) and Rodel and which is subject to these Terms and
Conditions.
1.31 This Agreement incorporates the
Schedule, which Schedule will have the same force and effect as if
set out in the body of this
Agreement.
2. SALE AND CESSION
2.1 The Client (AFP) hereby sells the
Claim to Rodel and Rodel hereby purchases the same upon and subject
to the terms and conditions
recorded in this Agreement.
2.2 By executing the Schedule, the
Client (AFP) hereby cedes, transfers and makes over to Rodel his
right, title and interest in
and to the Claim and Rodel hereby
accepts such cession upon the terms and conditions recorded herein.
2.3 The Client (AFP) shall authorise
and instruct the Conveyancer in writing to pay to Rodel an amount
equal to the First Payment
and the Discounting Fee and shall procure
that the Conveyancer furnishes Rodel with a written undertaking, in a
form acceptable
to Rodel, in terms of which the Conveyancer
irrevocably undertakes to pay to Rodel such amount on the
Registration Date.
3. ASSUMPTION OF OBLIGATIONS AND
OWNERSHIP AND RIGHT OF RODEL TO CANCEL THIS AGREEMENT
3.2 Ownership in and to the Claim
shall pass to Rodel upon payment by Rodel of the First Payment as set
out in the Schedule and
the cession and transfer shall thereupon be
of full force and effect without any further act of delivery being
required.
4. PAYMENT OF THE PURCHASE PRICE
4.1 Rodel shall pay the First Payment
as set out in the Schedule to the Client (AFP) within 2 (two)
business days after receiving
the written undertaking from the
Conveyancer and such other security or documentation as Rodel may
reasonably require.
4.2 The Purchase Price shall be
reduced by an amount equal to the Discounting Fee as at the
Settlement Date.
5. WARRANTIES – SALE
TRANSACTION
5.10 The Client (AFP) is not aware of
any fact, matter or circumstance pertaining to the Client (AFP) or
the Property, which might
prevent the Property from being transferred
to the Purchaser (CAP) in accordance with the Sale Agreement or which
might cause the
Registration Date to be delayed by more than 90
(ninety) days after the Signature Date and shall forthwith notify
Rodel in writing
in the event of the Sale Agreement being cancelled,
or if any dispute arises between the parties thereto, or any reason
exists
as to why the registration of the transfer may not proceed
within the 90 (ninety) day period referred to above.
5.11 The full amount of the Proceeds
will be payable to the Client upon the registration of the transfer
of the Property into the
name of the Purchaser (CAP).
5.12 The Client (AFP) shall forthwith
do all such things and pay all such amounts as the Conveyancer may
require in order to cancel
the Mortgage Bond and procure the
expeditious transfer of the Property to the Purchaser (CAP)…
5.14 The Client (AFP) shall not
terminate or cancel the instructions to the Conveyancer to attend to
the registration of transfer
without Rodel’s prior written
consent.
5.19 The Claim or any part thereof is
not subject to a prior cession, pledge or similar encumbrance.
The Client (AFP) acknowledges that
Rodel has entered into this Agreement in reliance of the warranties
set out in this clause, all
of which are material, and that if any of
the warranties are or become, to any extent, inaccurate or breached,
the client (AFP)
will have committed a fraud against Rodel.
7. TERMINATION
Rodel may summarily terminate this
Agreement without payment of compensation or other damages caused to
the Client (AFP) solely
by such termination by giving notice in
writing to the Client (AFP) if anyone or more the following events
or, which Rodel recently
anticipates is likely to occur for any
reason:
In the case of a sale transaction:
7.1 The Client (AFP) commits any
breach of any of its obligations under this Agreement and/or the Sale
Agreement or fails to fulfil,
the terms of the Sale Agreement in any
respect; or
7.2 Any warranty, representation or
undertaking given herein is to any extent inaccurate or has been
breached; or
7.5 The Sale Agreement has not become
or will cease to be of force or effect, whether by cancellation or
otherwise; or
7.6 The Registration Date does not
occur for any reason whatsoever within a period of 90 (ninety) days
after the Signature Date;…
8. CONSEQUENCES OF TERMINATION
8.1 If this agreement is cancelled
then:
8.1.1 All rights acquired by Rodel in
terms of the cession referred to in clause 2 of this Agreement shall
be deemed to have been
ceded and transferred back to the Client (AFP)
upon and against compliance by the Client (AFP) with clause 8.1.3 and
all other
outstanding obligations in terms of this Agreement.
8.1.3 The Client (AFP) shall refund to
Rodel in full any amount or amounts paid by Rodel to the Client (AFP)
or any other person
on its behalf in respect of the Purchase Price,
together with interest thereon, at the Interest Rate calculated from
the date of
each such payment by Rodel to the date of such refund by
the Client (AFP).
8.2 On termination of this Agreement
by Rodel pursuant to clause 7, Rodel shall be entitled (without
prejudice to any other rights
or remedies it may have) to recover
from the Client (AFP) the amount of all damages and loss suffered by
Rodel as a result (directly
or indirectly) of the Client’s
(AFP) failure, together with all sums previously paid to the Client
(AFP) under or in connection
with this Agreement. (Emphasis added)
[12] In simple terms, the discounting
agreement concluded between Rodel and AFP is a loan agreement of a
sum of money repayable
from the net proceeds of the sale together
with certain fees calculated at a daily rate, by AFP to Rodel upon
the registration
of transfer of the Norwood property in the name of
CAP. The schedule describes in detail the sum to be advanced (the
First Payment,
which in effect constitutes the “bridging
finance”) on loan to AFP. It also describes the discounting fee
calculated
at a daily rate of R1130-50 which will be added to the
amount advanced on the settlement date in order to establish the
amount
to be repaid to Rodel upon the registration date. The
additional features of the discounting agreement indicate:
1. As security for the repayment of
the loan plus discounting fees, the parties agreed to cede to Rodel
the entire net proceeds
of the sale of the property from which it
will calculate a settlement figure due to AFP after deducting from
the net proceeds the
amount due to Rodel. This amount constitutes
Rodel’s “Claim” to payment from “that portion
of the proceeds
set out in the schedule.” Thus, the net
proceeds of the sale will be reduced with the total loan
(R1 400 000-00)
and the discounting fees and such balance
will then be paid to AFP after the conveyancer received the
“settlement quote from
Rodel immediately upon registration of
transfer”.
26
2. The “Proceeds” is the
net amount of the sale price of the Norwood property due to AFP as
defined in the contract,
meaning the amount realised (R7 200 000-00)
from the sale of the property less the cost of cancellation of the
existing
bond in favour of Mercantile Bank Ltd (R R5 005 287-99),
agent’s commission and any other amount payable by AFP
arising
from the sale of the property. In the present case the schedule to
the first discounting agreement dated 31 August 2010
determines this
amount as being R2 369 408-00.
27
In regard to the second discounting agreement, the net proceeds is
stated as being R1 369 408-00 after a further amount
of
R1 000 000-00 was deducted from the sale price, described
as “Other undertakings”. It is not known what
this “other
undertaking” was for but it is of no consequence as the sale
price mentioned in the second schedule remains
at R7 200 000-00
from which is deducted the cancellation costs of the bond in the same
amount of R5 005 287-99
as in the first schedule.
28
3. In order to secure repayment from
the net proceeds to Rodel, the agreement records an obligation
29
by AFP to instruct its conveyancer in writing to pay Rodel an amount
equal to the loan and discounting fee. AFP is further obliged
to
furnish Rodel with a written undertaking from the conveyancer wherein
he “irrevocably undertakes to pay Rodel such amount
on the
Registration Date.” This contractual undertaking by AFP is
reflected in clause 7 of the “Conveyancer’s
Undertaking”
which was signed by Mr Berman.
30
4. The agreement between Rodel and AFP
further contains a warranty that the entire transaction will be
speedily completed. The parties
did not expect the finalisation to
take more than 3 months.
31
Both counsel referred to this as an understanding between the parties
that it would constitute an “in and out” contractual
regime.
5. AFP also warranted that it would
not terminate the conveyancer’s mandate to affect the
registration “without Rodel’s
prior written consent.”
32
Any attempt to cancel the conveyancer’s mandate without Rodel’s
prior written consent would constitute a breach of
the agreement
between AFP and Rodel. This contractual term is mirrored in clause 9
of the Conveyancer’s Undertaking.
6. The agreement contains a warranty
by AFP that the “Claim” to the net proceeds ceded to
Rodel “is not subject
to a prior cession, pledge or similar
encumbrance”.
33
This clause will be relevant in order to deal with the defendants’
contention that an alleged prior cession of the proceeds
to the
bondholder, invalidated Rodel’s claim to the proceeds.
7. The agreement expressly declares
these warranties to be material and that any breach thereof would
constitute a fraud committed
by AFP against Rodel.
34
8. The agreement expressly provides
for the obligation to repay the full amounts (together with interest)
which was paid by Rodel
to AFP, to survive any cancellation of the
agreement.
35
The parties further agreed that even if the sale of the Norwood
property is cancelled, that in itself would not release the
Conveyancer
from repaying certain amounts to Rodel.
36
THE BACKGROUND FACTS
October 2010
[13] CAP, as purchaser of the Norwood
property, substantially delayed the finalisation of the transaction
due to its refusal to
make VAT payments on the purchase price. A
dispute arose between CAP and AFP as to whose liability it was to pay
VAT, CAP contending
that the South African Revenue Services should
have zero rated the transaction.
[14] As a result of this delay, AFP
cancelled the agreement of sale with CAP. On 22 October 2010
37
Mr Nathan Blumenthal acting on behalf of AFP wrote a letter to Mr
Jacques Morkel of Rodel confirming that; (i) they had cancelled
the
sale of the Norwood property concluded with CAP due to the latter’s
delay in paying the VAT; (ii) the repayment of the
monies are still
due to Rodel and apologising for the delay in repaying; (iii) the
loan is well secured as they are reselling the
property at R8.2
million in a more buoyant market; and (iv) Stupel and Berman will
remain on board to attend to the next auction
sale which was set for
24 November 2010.
[15] On the same day, 22 October
2010
38
,
Stupel and Berman informed Rodel in writing of the developments in an
e-mail as follows:
“
We understand that you have
already received a communication from Mr Nathan Blumenthal for and on
behalf of Amber Falcon Properties
advising you that the seller (Amber
Falcon Properties 3 (Pty) Ltd) has elected to cancel the transaction
as the Purchaser has not
complied with its obligations to effect
payment of the Value Added Tax to the Department of Inland Revenue.
We further understand that he has
contacted the Alliance Group who originally sold the property who are
immediately re-selling same
(we understand that the property is quite
saleable and a higher price will be sought).
Accordingly, this notification to you
is given in line with the undertaking that was given to you to keep
you informed of important
developments in regard to the transaction.”
(Emphasis added)
It will be noted that in this letter
Stupel & Berman gave no indication of any intent to withdraw
their undertaking given to
Rodel. On the contrary, by complying with
the duty to inform Rodel of important developments, they are actually
confirming that
they are still bound by the terms of their
undertaking. Coupled with the advice of Mr Blumenthal that “the
transferring attorneys
Stupel & Berman will remain on board”,
there was at this stage no reason for Rodel to be concerned about the
direct repayment
as promised by the conveyancers in their written
undertaking.
[16] On 25 October 2010
39
Mr Blumenthal sent a further e-mail to Rodel confirming that the next
auction was to be held on 24 November 2010 and further advising:
“
I have instructed our offices
as well as those of the transferring attorneys, Stupel & Berman
that you are to be privy to any
documentation pertaining to this
transaction (Alliance mandate, recent rental property details etc.)
should you so wish.”
(Emphasis added)
The import of this letter can be none
other than a confirmation to Rodel that the same contractual regime
will remain in place as
that which followed on the original sale of
the Norwood property. This instruction was also not countermanded by
AFP at this stage.
November 2010
[17] Unbeknown to Rodel, CAP launched
an urgent application on 8 November 2010 to interdict AFP, Auction
Alliance and Stupel &
Berman from proceeding with the auction on
24 November 2010. The application was successful and an interim order
was issued on
24 November 2010 interdicting the sale on auction of
the Norwood property.
40
In accordance with a discovered internal note, it appears that on 26
November 2010,
41
Mr Berman verbally informed Rodel that the auction set for 24
November 2010 did not go ahead as the previous purchaser was
“contending
the resale”. The note indicates that Mr
Berman informed Rodel that a new purchaser might be lined up and that
Rodel “shouldn’t
worry”. In my view, this
constituted a further affirmation by Mr Berman, in line with that of
AFP that the discounting agreements
and the conveyancer’s
undertaking were still in place.
January 2011
[18] On 25 January 2011
42
the urgent interdict applied for was settled. In terms of a letter
from Stupel & Berman to Ismail Ayob and Partners, the attorneys
acting for CAP, the settlement was recorded as follows:
“
2. We confirm that our client
has agreed to settle the matter on the following terms:
2.1 That the respective parties will
follow through with the transfer of the property;
2.2 That your client will contribute
R50 000.00 towards our client’s legal costs;
2.3 That your client will pay on
demand the VAT for the transfer of the property; and
2.4 That our client will endeavour
to obtain the required SARS clearance.
3. In light of the above we shall
proceed to remove the matter from the roll and we shall serve the
necessary notice on your offices
as soon as possible.”(Emphasis
added)
As I understand this letter, the
parties revoked the cancellation of the sale of the Norwood property
and decided to continue therewith
subject only to certain additional
undertakings as to payment of legal costs for the interdict
application and to attempt to obtain
a zero clearance certificate
from SARS. In effect, the parties continued with the original sale of
the Norwood property. AFP and
CAP did not enter into a new written
contract (as provided by law) for sale of the Norwood property.
February 2011
[19] In an e-mail dated 3 February
2011
43
Mr Nathan Blumenthal misinformed Rodel about the state of affairs.
Instead of informing Rodel that the interdict proceedings had
become
settled and that the parties agreed to proceed with the sale, he
stated the opposite. He offered an amount of R1.520 million
to Rodel
in payment of the bridging finance and discounting fee. Be that is it
may, the email constituted an acceptance that the
obligation to repay
the bridging finance was still alive and well even after a purported
cancellation of the sale of the Norwood
property.
[20] In accordance with the internal
note of Rodel, it would also appear that on 3 February 2011 Mr Berman
spoke to someone at Rodel
informing them that they were going ahead
with the first buyer and they were only waiting for him to pay the
transfer duty. This
is consistent with the interpretation of the
parties’ conduct as stated in paragraph [18] above. The note
also records that
Mr Blumenthal misinformed Rodel by stating that
they had lost the court case which was not true as the matter became
settled. The
representative of Rodel who drafted the internal note
informed Mr Blumenthal that Rodel intended to “hand him over”,
presumably to Rodel’s attorneys.
[21] The very next day, 4 February
2011, Rodel’s attorney of record addressed a registered letter
to AFP cancelling the agreement
concluded between the parties on 31
August 2010. Since there is a dispute as whether or not the documents
show that Rodel cancelled
both discounting agreements, it is
necessary to refer to the content of this letter. It states:
“
1. Our client (Rodel) hereby
cancels the Agreement entered into between you (AFP) and our client
on 31 August 2010.
2. We have been instructed to demand
from you, as we hereby do, payment of the sums of R850 000.00
and R550 000.00 plus
the discounting fee of 0.133% per day on
the amount of R850 000.00 from 31 August 2010 to date of
payment, both days inclusive
and on the amount of R550 000.00
from 2nd September 2011 to date of payment, both days inclusive, in
regard to the monies
lent and advanced to you pursuant to Discounting
Agreements entered into between yourself and our client on 31 August
2010 within
20 days from date hereof. The amount outstanding as at 3
February 2011 is the sum of R1 690 870.00.” (Emphasis
added)
[22] It is immediately noticeable that
the letter is ambiguous. Paragraph 1 refers to “Agreement”
in the singular and
only to the agreement dated 31 August 2010.
However, paragraph 2 of the letter refers to the two amounts of
R850 000.00 and
R550 000.00 plus discounting fees
calculated from both 31 August 2010 and 2 September 2011 on the two
respective amounts.
It also refers to “monies lent in advance
to you pursuant to Discounting Agreements” in the plural, but
then state
that it was concluded on 31 August 2010 only. The last
sentence of paragraph 2 again indicates that the amount outstanding
includes
both amounts of bridging finance plus a discounting fee
amounting to R1 690 871.00.
[23] The understanding of AFP of the
import of this letter is recorded in a letter dated 17 February
2011.
44
This letter records the following:
“
I refer to your letter dated 04
February 2011 (received only after that date).
We inform you that we have appointed
Attorneys Bieldermans Incorporated, namely Mr Pieter Bielderman, to
dispose of the matter.
We confirm that we accept your
cancellation of the Agreement.” (Emphasis added)
The letter poignantly refers to a
cancellation of “the Agreement” (singular). This letter
also implies that a new attorney
has been appointed to dispose of
this matter. It is unclear as to whether the “matter” to
be disposed of refers to
the sale of the Norwood property or the
discount agreements. However, whichever meaning is to be ascribed to
this letter, as between
Rodel and AFP, the latter had a continuing
obligation to repay the bridging finance and any lawful release of
the conveyancers,
required the prior written consent from Rodel.
[24] In a further letter of even
date
45
,
Mr Blumenthal on behalf of AFP, wrote Rodel’s attorneys of
record stating that liability for payment of the amount claimed
in
Rodel’s letter of 4 February 2011 is denied and a request is
made to refer the matter ‘to a Dispute Resolution Agent,
Consumer Court, Ombudsman, etc.”
[25] Also on 17 February 2011
46
,
Stupel & Berman sent “copies of the signed undertaking for
Rodel” made by it to AFP. This constitutes a further
admission
by Stupel and Berman that the undertaking to pay the proceeds of the
sale, was given “for Rodel” and not
only to AFP.
[26] Mr Blumenthal, acting on behalf
of AFP, addressed a letter dated 21 February 2011
47
,
signed by Joy Moraine on his behalf, to Stupel & Berman
confirming that “Rodel have indeed cancelled the Agreement”
(singular) and that “such cancellation” was accepted by
AFP. The letter further stated:
“
Following the above, we request
that you withdraw your Letter of Undertaking to Rodel and insofar as
any other arrangements/negotiations
with Rodel are concerned –
kindly deemed same to be cancelled.”
[27] Also on 21 February 2011,
Bieldermans Inc acting on behalf of AFP wrote two letters, one to
Rodel’s attorneys of record
and one to Stupel & Berman. In
both these letters Bieldermans only addresses the cancellation of one
discounting agreement
dated 31 August 2010. The letter written to
Norman Berger and Partners Inc
48
reads as follows:
“
We acknowledge receipt of your
letter dated 4 February 2011 addressed to our client Amber Falcon
Properties 3 (Pty) Ltd (hereinafter
referred to as ‘our
client’) and handed to us for our attention and reply.
Our client notes that your client has
given formal notice of cancellation of the Discounting Agreement
concluded between our respective
clients on 31st August 2010. Our
client hereby accepts the cancellation and no longer regards it as
bound by the terms and conditions
of the said Agreement.
We are further instructed to advise
attorneys Stupel & Berman Inc of the aforegoing. We have
instructed Stupel & Berman
on behalf of our client to withdraw
any and all undertakings given by them in terms of the aforesaid
Agreement. This instruction
is inter alia as a result of your
client’s cancellation of the Agreement.” (Emphasis added)
The letter written by Bieldermans Inc
to Stupel & Berman
49
reads as follows:
“
We are instructed that you
assist our client in your capacity as Conveyancer in the sale of our
client’s property known as
Erf 416 Norwood. Our client entered
into a discounting agreement with Rodel Financial Services on the
31st August 2010 in terms
of which our client obtained ‘bridging
finance’. We understand that you issued certain undertakings on
behalf of our
client in favour of Rodel Financial Services (Pty) Ltd.
We enclose herewith a copy of a letter
dated 4 February 2011 which our client has received from attorneys
Norman Berger and Partners
Inc representing Rodel Financial Services
(Pty) Ltd. As you will note, the attorneys on behalf of their client
have cancelled the
Discounting Agreement.
We enclose herewith a copy of our
letter in response thereto in terms of which our client has accepted
the cancellation. In the
circumstances we hereby formally instruct
you, on behalf of our client, not to proceed any further with any
undertakings given
in favour of Rodel Financial Services (Pty) Ltd.
You are requested to immediately withdraw and all undertakings given
by you in
terms of the aforesaid Discounting Agreement.”
(Emphasis added)
[28] In response to the aforesaid
instructions, Stupel & Berman addressed a letter dated 24
February 2011
50
to Rodel wherein the following is stated:
“
1. As you are aware, we are
attending to the above transfer of Erf 416 Norwood from Amber Falcon
Property (Pty) Ltd to Cross Atlantic
Properties 186 (Pty) Ltd.
2. We attach hereto a copy of a fax
dated 21 February 2011 from Bieldermans Inc Attorneys wherein they
instruct us to immediately
withdraw any and all undertakings given by
us in terms of a Discounting Agreement concluded between Rodel
Financial Services (Pty)
Ltd and Amber Falcon Properties 3 (Pty) Ltd.
3. In the circumstances we are
compelled to give effect to the mandate/instruction of Amber Falcon
Property 3 (Pty) Ltd and hereby
withdraw from the undertaking given
by us as Conveyancers in the above transaction on the 27th September
2010.” (Emphasis
added)
Stupel & Berman in the above
letter also refers to “a Discounting Agreement”
(singular) and purport to withdraw
from “the undertaking”
(singular) in the “above transaction” (singular). It does
not, however, withdraw
as the “Conveyancer” whose duty it
is to procure the transfer of the Norwood property. In paragraph 2
of the letter
they do, however, attach and rely upon Bieldermans’
letter of 21 February 2011
51
which speaks of a single discounting agreement which was dated 31
August 2010 as having been cancelled. It is further common cause
that
the date of “27th September 2010” referred to in
paragraph 3 in this letter is incorrect.
March 2011
[29] Unbeknown to Rodel, Stupel &
Berman (still acting as conveyancer) lodged transfer documents for
the Norwood property with
the Registrar of Deeds on 8 March 2011. It
is common cause that transfer of the Norwood property into the name
of CAP occurred
on 17 March 2011. Neither of these events was told to
Rodel.
[30] Rodel then sought to exercise its
rights against AFP arising from the discounting agreements and also
against Mr Julius Blumenthal
arising from the suretyship that he had
signed in favour of Rodel. On 16 March 2011
52
Rodel as plaintiff issued summons against them. Contrary to Rodel’s
attitude that only one discounting agreement was cancelled,
it
alleged in paragraph 8 of the particulars of claim that it had
cancelled both agreements
53
relying for such cancellation on the letter of 4 February 2011 sent
by registered post by Norman Berger and Partners Inc to AFP,
referred
to earlier. Blumenthal and AFP filed a notice of intention to defend.
[31] It is common cause that Stupel
and Berman paid the net proceeds of the sale of the Norwood property
to AFP on 30 March 2011.
54
Nothing was paid to Rodel.
May 2011
[32] On 10 May 2011
55
summary judgment was applied for by Rodel wherein Mr Jacques Morkel
stated under oath that he could positively swear to the facts
set out
in the summons. He also confirmed the indebtedness in the claimed
amount of bridging finance plus discounting fees due
on both the sums
of R850 000.00 and R550 000.00.
56
June 2011
[33] On 17 June 2011 Rodel was awarded
summary judgment against AFP and Mr Blumenthal in the amount of
R1 763 489.00 plus
discounting fees, interest and costs.
57
Although Blumenthal and AFP instructed attorneys to apply for leave
to appeal this judgment
58
,
such application was not proceeded with.
July 2011
[34] On 25 July 2011
59
Rodel’s attorneys of record sent a letter to Stupel &
Berman informing them that judgment had been obtained against APF
and
reminded them of their irrevocable undertaking they had given to make
payment to Rodel. The letter also records that Rodel
never consented
to the release of Stupel & Berman from their undertaking and that
the unilateral attempt to do so was never
accepted or condoned. They
demanded payment of the amount by no later than Tuesday 26 July 2011.
[35] On 28 July 2011
60
Rodel’s attorneys of record received a letter from Stupel &
Berman wherein – (i) they denied acting for AFP or
Blumenthal,
stating that Bieldermans was their attorney; (ii) they contended that
the sale agreement of the Norwood property was
cancelled but after
the urgent application to enforce it, the matter was settled and “the
Purchaser (CAP) and Seller (AFP)
agreed to reinstate the agreement
(in essence a new agreement)”; (iii) they expressed the view
that “by reason of the
cancellation of the agreement
(notwithstanding reinstatement) our undertaking automatically
expired”; (iv) they relied on
the cancellation by Rodel of the
discounting agreement with AFP, alleging that the undertakings
therefor fell away “by operation
of law”; (v) they
contended that the undertaking was not “an irrevocable
undertaking to pay” but merely an “acknowledgement”
by them that the “Seller (AFP) provided us with an irrevocable
instruction to pay”; (vi) they also contended that AFP
had
instructed them to withdraw from such an undertaking; and finally,
(vii) they denied owing any amounts to Rodel.
September and October 2011
[36] On 29 September 2011
61
Rodel’s attorneys of record caused a writ of execution to be
issued in terms of the judgment obtained against Mr Blumenthal
and
AFP.
[37] On 19 October 2011 the sheriff
served the writ on AFP at its registered office which was the same
address as the chosen domicilium
citandi et executandi i.e. 52 Grant
Avenue, Norwood, Johannesburg of AFP. To date both AFP and Blumenthal
have failed to make payment
of the writ.
November 2011
[38] As a result, Rodel issued summons
against Stupel & Berman as first defendant and Mr Berman as
second defendant on 14 November
2011. The parties filed pleadings and
the defendants have raised various defences.
62
THE STATED CASE
[39] The stated case reads as follows:
“
A: TAKE
NOTICE THAT:
1. By agreement between the parties
and subject to the leave of this Honourable Court, the issues between
the parties as set out
in the pleadings are to be determined as a
stated case.
2. The parties have agreed upon a
written statement of facts in the form of a Special Case for the
adjudication of the Court; and
3. The agreed facts and questions of
law between the parties and their contentions thereon are set out
hereunder.
B: IT IS AGREED:
1. THE FACTS (RULE 33(2)(a))
1.1 The parties are agreed that as
part of the facts which may be taken into account by this Honourable
Court, regard may be had
to all of the documents in exhibit “A”.
It is agreed that the documents are what they purport to be and
regard may
be had to the contents thereof as if their authors had
testified as to their content (such documents are not annexed hereto
but
are to be taken as if they have, for the purposes of Rule 33 (2)
(a)).
1.2 In addition to the documents
contained in exhibit “A”, the following shall be added
thereto and handed to the Court
as exhibit “C”:
1.2.1 the summons issued by Rodel
Financial Services (Pty) Ltd (“Rodel”) against Amber
Falcon (“the Client”)
and Julius Blumenthal; and
1.2.2 the Heads of Argument which were
submitted on behalf of Rodel in obtaining summary judgment against
the Client and Julius
Blumenthal
1.3 Without derogating from what is in
the documents in exhibit “A” the following facts are
agreed upon.
1.4 That on 31st August 2010, the
Client and Rodel entered into a bridging finance agreement in terms
whereof Rodel paid to the
Client the sum of R850 000.00 on the
terms and conditions as set out more fully in exhibit “A”
(“the first
discounting agreement”).
1.5 That on 2nd September 2010, the
Client and Rodel Financial Services (Pty) Ltd (“Rodel”)
entered into a bridging
finance agreement in terms whereof Rodel paid
to the Client the sum of R550 000.00 on the terms and conditions
as set out
more fully in exhibit “A” (“the second
discounting agreement”).
1.6 That pursuant to and as a
condition for entering into the first and second discounting
agreements with the Client, Stupel &
Berman Incorporated ("the
Conveyancing attorneys"), represented by Michael Berman
("Berman") furnished written
undertakings in favour of
Rodel as set out more fully in exhibit “A”.
1.7 The defendants were never
furnished with, nor were they aware of the “Discounting Terms
and Conditions” which pertained
to and governed the first and
second discounting agreements.
1.8 The discounting agreements were
concluded pursuant to a sale of certain immovable property from the
Client to Cross Atlantic
(Pty) Ltd (“the Purchaser”).
1.9 In terms of the terms and
conditions of the respective discounting agreements, Rodel purchased
“the claims” as defined.
1.10 On 2 February 2009 the Client had
caused a mortgage bond in the form as it appears as annexure “P1”
to the defendants’
plea to be registered over the property in
favour of Mercantile Bank Limited.
2. Rodel complied with all of its
obligations in terms of the agreements to the Client.
12. On the 22nd October 2010, Nathan
Blumenthal (“Nathan”), sent an email on behalf of the
Client to Rodel in which
he inter alia informed Rodel that:
1.12.1 the Client had cancelled the
abovementioned Sale Agreement of the Property as a result of the
failure of the Purchaser to
inter alia pay the VAT payable in terms
of clause 4.7 of the Sale Agreement;
1.12.2 the Property was being
re-marketed at a higher price and would be auctioned on 24 November
2010;
1.12.3 the advance from Rodel was well
secured;
1.12.4 the First Defendant “will
remain on board and attend to the next sale and transfer thereof”.
1.13 On 22 October 2010 Jacques Morkel
advised Nathan, inter alia, that : “We are comfortable with
the situation as explained
by you. Please keep us posted on further
developments and let me know as soon as you get a date for the next
auction”
1.14. On the 22nd October 2010, the
Conveyancing Attorney sent an email to Rodel in which it confirmed
the Client had cancelled
the Sale Agreement of the Property and that
it was being re-sold and stated that this notification was given to
Rodel in line with
the undertaking that was given to Rodel by the
Conveyancing Attorney to keep Rodel “informed of important
developments in
regard to the transaction”.
1.15 On the 8th November 2010, the
Purchaser instituted, under case number 45304/2010, an urgent
application against the Client,
Auction Alliance and the Conveyancing
Attorney, inter alia seeking to interdict the disposal of the
property by the Client pending
an order directing the client to take
such steps as are necessary to effect registration of transfer of the
property from the client
to the purchaser, Cross Atlantic in terms of
the sale agreement against payment of the purchase price, VAT or
transfer duty as
may be required by SARS and such other amount as are
payable in terms of the sale agreement.
1.15 On 24 November 2010, this
Honourable Court granted an interim order inter alia:-
1.15.1 interdicting the Client from
disposing of or alienating the property;
1.15.2 interdicting and restraining
the Conveyancing Attorney from releasing any monies held in trust to
the Client or any other
person.
1.16 At all material times hereto the
Conveyancing Attorney acted on its own behalf and on behalf of the
Client in opposing the
interdict proceedings.
1.17 On 5 January 2011, Tammy
Parkinson of Rodel sent an e-mail to Nathan in which she requested an
update on the matter and enquired
“what is going to happen with
this transaction as you mentioned that you will more than likely be
proceeding with the original
sale?”.
1.18 On 25 January 2011, Berman on
behalf of the Conveyancing Attorney and the Client recorded in
writing the settlement of the
interdict proceedings and which
includes “the respective parties will follow through with the
transfer of the property”
as is set out in exhibit “A”.
This letter was sent by the Conveyancing Attorneys to the purchaser,
Cross Atlantic.
the settlement was confirmed by the purchaser’s
conveyancers on the 21 January 2011
1.19 On 3rd February 2011, Tammy
Parkinson of Rodel was advised telephonically by Berman that the sale
between the Client and Cross
Atlantic would be proceeding and that
they were waiting for the purchaser to pay transfer duty.
1.20 On 3rd February 2011, Tammy
Parkinson of Rodel was advised telephonically by Nathan that the
Court case had been lost and that
he had a settlement agreement that
he wished to look over before he took a decision on whether he would
accept such an offer.
He was told that Rodel had to hand him over.
1.21 On 3rd February 2011, Nathan sent
an e-mail to Rodel as set out in exhibit “A” stating as
follows:-
1.21.1 “we clearly have a
situation on our hands in that the Courts have indeed granted the
Purchaser’s (sic) their
order to prevent the property from
being re-auctioned;
1.21.2 the sale can be held in limbo
anything from six to twelve months;
1.21.3 the bond holders are
threatening to foreclose;
1.21.4 we are unable to proceed with
the sale of the property to a third party;
1.21.5 Precarious indeed. I am
currently negotiating with the sellers, to settle the matter and to
proceed with the sale;
1.21.6 the only way forward, it seems
is that the bondholder agrees to a settlement figure less than they
are claiming;
1.21.7 ourselves (the Seller) agrees
to less money and abandonment of our claims;
1.21.8 the attorneys have already
agreed to a substantial reduction of their account.”
1.22 On 4th February 2011, Rodel,
through its attorneys Norman Berger and Partners, sent a letter of
cancellation which only referred
to the first discounting agreement
and demanded payment of the amounts due in terms of both discounting
agreements.
1.23 On 17 February 2011 the Client
advised Rodel that it had appointed Attorneys Bielderman to dispose
of the matter, and confirmed
that it accepted Rodel’s
cancellation.
1.24 On the 21st February 2011, the
Client wrote to the Conveyancing Attorney with a “request that
you withdraw your Letter
of Undertaking to Rodel and insofar as any
other arrangements / negotiations with Rodel are concerned –
kindly deem same
to be cancelled”.
1.25 Also on 21 February 2011, Rodel’s
attorneys of record received a letter from Bieldermans Inc. in which
Rodel was informed
inter alia that the Client accepted the
cancellation of the first Discounting Agreement and no longer
regarded itself bound by
the terms and conditions of the said
Discounting Agreement.
1.26 Also on 21 February 2011,
Bieldermans, on behalf of the Client, formally instructed the
Conveyancing Attorneys not to proceed
further with any undertakings
given in favour of Rodel, and requested them to immediately withdraw
any and all undertakings given
by them.
1.27 On the 24th February 2011, the
Conveyancing Attorneys sent Rodel’s attorneys of record a
letter in which they:
1.27.1 Recorded that, as Rodel were
aware, they were attending to the relevant transfer;
1.27.2 referred to the fax dated 21
February 2011 from Bieldermans Inc. wherein Bieldermans Inc.
instructed them to withdraw the
abovementioned undertakings given by
them and informed Rodel’s attorneys of their withdrawal from
“the undertaking
given on 27 September 2010”. The
reference to 27 September 2010 is an obvious error.
1.28 Vis-à-vis the defendants,
the first time the plaintiff reacted or responded in any way to that
letter of 24 February
2010 was by way of its attorneys’ letter
of 25 July 2010 to which reference is made below. In the intervening
period, the
plaintiff pursued the remedies available to it, against
the Client and Julius Blumenthal.
1.29 Despite demand the Client failed
to refund Rodel any amount paid by Rodel to the Client in respect of
the Purchase Price and
failed to pay Rodel any discounting fees
thereon.
1.30 On 8th March 2011, the documents
relating to the transfer of Erf 416, Norwood from the Client to Cross
Atlantic were lodged
in the deeds office.
1.31 On the 16th March 2011, Rodel
caused a Combined Summons to be issued by this Honourable Court under
Case No. 2011/11100 against
the Client and Julius Blumenthal for
payment of the amount of the sum of R1 783 489.00 plus
discounting fees and interest
in respect of the amount due to Rodel
in terms of the abovementioned Discounting Agreements. In its
particulars of claim, Rodel
alleged that both discounting agreements
had been cancelled and claimed the outstanding amounts under both
agreements.
1.32 Service of the abovementioned
Combined Summons was affected on the Client and Julius Blumenthal on
23 March 2011.
1.33 On the 17th March 2011, the
following occurred, without Rodel's knowledge:
1.33.1 transfer of the Property was
registered in the name of Cross Atlantic;
1.33.2 payment of the purchase price
for the Property was made by Cross Atlantic to the Conveyancing
Attorneys.
1.34 The Conveyancing Attorneys paid
the net proceeds of the sale of the property to the Client on the
30th March 2011.
1.35 On the 31st March 2011, the
attorneys of record of the Client entered into an Appearance to
Defend the Combined Summons.
1.36 On the 11th April 2011, the
attorneys of record of Rodel served a Notice of Set Down in terms of
Rule 32(2) of an Application
for Summary Judgment in respect of the
abovementioned Combined Summons for hearing on 10 May 2011. It was
accompanied by an affidavit
which confirmed the allegations contained
in the particulars of claim.
1.37 On the 10th May 2011, the
attorneys of record of Rodel received an AFFIDAVIT IN OPPOSITION TO
APPLICATION FOR SUMMARY JUDGMENT
and the hearing of the Application
was postponed to 17 May 2011 with the Client to pay the wasted costs.
1.38 On the 17th May 2011, the
Application for Summary Judgment was heard by Acting Judge G.
Rautenbach and on 17 June 2011 he handed
down his judgment in favour
of Rodel in the sum of R1 763 489.00 plus discounting
fees and interest and costs as set
out in the judgment.
1.39 To date, neither the Client nor
Julius Blumenthal has complied with the abovementioned Order.
1.40 On the 25th July 2011, Rodel’s
attorneys of record sent a letter to the Conveyancing Attorneys in
which they inter alia:
1.40.1 Informed them that judgment had
been obtained against the Client in terms of the judgment which it
attached;
1.40.2 reminded the Conveyancing
Attorneys of the irrevocable undertaking they had made to pay Rodel;
1.40.3 stated that Rodel never
consented to release the Conveyancing Attorneys from their
undertaking and that their unilateral
attempt to withdraw from such
undertaking was never accepted or condoned; and
1.40.4 demanded payment of the
judgment debt by close of business on 26 July 2011.
1.41 On the 28th July 2011, Rodel’s
attorneys of record received a letter from the Conveyancing Attorneys
in which they inter
alia informed them that:
1.41.1 by reason of the cancellation
by Rodel of the Discounting Agreement, by operation of law the
undertaking provided by them
fell away;
1.41.2 the first defendant did not
provide an irrevocable undertaking to pay, but merely acknowledged
that the client provided them
with an irrevocable instruction to pay.
1.41.3 they had been instructed by the
Client to withdraw from such undertaking which they had done on 24
February 2011; and
1.41.4 they denied any legal
obligation to pay Rodel any sum whatsoever.
1.42 On the 29th September 2011,
Rodel’s attorneys caused a Writ of Execution in terms of the
abovementioned judgment to be
issued against the Client and Julius
Blumenthal.
1.43 On the 19th October 2011, the
Sheriff of this Court served the Writ of Execution on the Client at
its registered office by
affixing a copy of the original to the main
door of such registered office as a result of not being able to find
a responsible
employee or other person thereat willing to accept
service.
1.44 In deciding the parties’
respective legal contentions it is noted that Rodel withdraws its
contentions that the Defendants
applied to Rodel on behalf of the
Client for bridging finance pursuant to the sale of Erf 416, Norwood
(“the property”)
to Cross Atlantic (the purchaser), that
the Defendants initiated the application for bridging finance and
that the defendants represented
the clients in entering into the
bridging finance agreements.
1.45 Furthermore, the plaintiff also
withdraws its alternative delictual claim.
2. THE LEGAL ISSUES TO BE
DETERMINED
2.1 Whether or not, in the
circumstances of this matter, the claim in respect of immovable
property can be ceded by the seller to
a third party in a discount
sale agreement or whether such cession amounts to a partial cession
of a debt.
2.2 Whether or not Rodel acquired good
and valid title to the claim as defined in the discounting
agreements;
2.3 Whether or not the Conveyancing
Attorney was pursuant to the first and second discounting agreements
entitled to and did, in
fact, withdraw the undertaking/s given;
2.4 Whether or not Rodel has a good
and valid claim against the Conveyancing Attorney and Berman in the
circumstances.
3. THE CONTENTIONS FOR THE PARTIES
The full contentions of each of the
parties are contained in their respective Heads of Argument. Without
derogating therefrom or
limiting such contentions in any way, a
summary thereof is set out below.
The Plaintiff contends:
3.1 that the cession of the claim
and proceeds to Rodel is valid and does not amount to a partial
cession of a debt;
3.2 that the undertakings given by
the Conveyancing Attorneys on the 31st August 2010 and the 2nd
September 2010 and Berman
constituted a separate and distinct
legal agreement between Rodel and the Conveyancing
Attorney/Berman, that remained valid
and binding whether or not
the first or the second discounting agreements were cancelled;
3.3 that the second discounting
agreement was never validly cancelled nor did the client accept
any cancellation thereof;
3.4 that the undertakings given by
the Conveyancing Attorneys and Berman survived the cancellation of
the first discounting
agreement, but in any event since the second
discounting agreement was never cancelled the undertaking
furnished in terms
of the second discounting agreement remained of
full force and effect;
3.5 that the undertaking on the
part of the Conveyancing Attorneys to keep Rodel advised of
important and material developments
was breached; and
3.6 that the undertaking to pay
Rodel the claim within 72 hours of registration of transfer was
breached;
3.7that the conveyancing attorneys
and/or Berman should be fixed with constructive knowledge of the
Terms and Conditions of
the Discounting Agreements.
The Defendants contend:
3.7 that the agreement of sale
entered into between the client and Cross Atlantic on the 9th
February 2010 was cancelled;
3.8 that the Client ceded a portion
of the proceeds to Rodel;
3.8 that on a proper interpretation
and construction of the discounting agreement this cession
amounted to a partial cession
and, by virtue of the lack of
consent from Cross Atlantic, it is for that reason enforceable and
invalid;
3.9 that the undertakings given
pursuant to an invalid partial cession, and as part of the
discounting agreements, are unenforceable
and invalid;
3.10 that the claim as defined was not
capable of being ceded to Rodel because on the 2nd February 2009 the
Client had caused a
covering mortgage bond over the property to be
registered in favour of Mercantile Bank. It is alleged that in terms
of this bond
the Client had already ceded the entire proceeds to
Mercantile Bank and the purported cessions as contained in the
Discounting
Agreements were invalid and unenforceable thus rendering
the Discounting Agreements invalid and unenforceable.
3.11 that the undertakings do not
constitute separate and enforceable agreements between Rodel and the
Conveyancing Attorneys and
Berman;
3.12 that they were obliged by virtue
of their obligations as attorneys to follow and adhere to the
instructions of the Client to
withdraw the undertakings they have
given to Rodel;
3.13 that both the first and second
discounting agreements were cancelled on the 4th February 2011;
3.14 that the undertakings were of no
force and effect for the reasons set out above and hence the
Conveyancing Attorneys and Berman
were not in breach of any
obligation to Rodel;
3.15 that Rodel’s failure to
dispute the withdrawal of the undertaking relating to the first
discounting agreement on the
24th February 2011 amounted to a waiver
of its right to enforce the undertaking alternatively whether Rodel
is estopped from enforcing
compliance with the undertaking;
3.16 that Rodel by electing to
institute action against the Client and the surety forfeited its
right to institute action against
the Defendants.
3.17 The Defendant informed the
Plaintiff of all relevant facts and circumstances pertaining to the
conveyancing transaction”.
3.18 That the Plaintiff represented to
the Defendant that both discounting agreements had been cancelled.
4. THE ISSUES TO BE ADJUDICATED
4.1 Whether the cession of the claim
to the proceeds arising out of the sale transaction between the
client and Cross Atlantic Properties
were legally acquired and
remained the sole property of Rodel.
4.2 Whether the undertakings given by
the Conveyancing Attorney and Berman are separate agreements.
4.3 Whether the second discounting
agreement was ever cancelled.
4.4 Whether the undertaking/s that
arose from the first and second discounting agreements ceased to be
of force or effect upon the
cancellation of that/those agreement/s if
cancelled.
4.5 Whether the Conveyancing Attorneys
and Berman breached the terms of their undertakings by failing to:-
4.5.3 advise Rodel of all relevant
facts and circumstances;
4.5.2 pay the claim to Rodel
notwithstanding the transfer of the property and receipt of the
proceeds arising out of the sale.
4.6 Whether Rodel accepted the
withdrawal of the undertakings and, if not, whether it waived or is
estopped from asserting any rights
it may have in terms of the
undertakings.
4.7 Whether any breach/es by the
defendants are causally connected to the plaintiff’s loss.
5. THE COURT’S RULING
5.1 If the Court finds in favour of
Rodel then judgment in the sum of R1 763 489.00 plus
interest at the rate 15.5% per
annum from the 18th March 2011 to date
of payment plus costs of suit which costs are to include the costs
consequent upon the employment
of two counsel.
5.2 If the Court finds in favour of
the Conveyancing Attorneys and Berman then the action is to be
dismissed with costs, which costs
are to include the costs consequent
upon the employment of two counsel.”
THE LEGAL ISSUES TO BE DECIDED
[40] Despite the sequence of the legal
issues as set out in paragraph 2 of the stated case, I find it more
convenient to deal with
them as follows:
1. The legal nature of the
Conveyancer’s undertaking.
2. The alleged cancellation of the
discount agreements.
3. The validity of the cession of net
proceeds of the sale of the Norwood property.
The Conveyancer’s Undertaking
[41]It would appear to me that the
parties failed to address the true nature of the undertakings
contained in the schedule to the
discounting agreements. It is
important to understand the true nature of such undertakings in order
to establish whether or not
it was in fact irrevocable either by AFP
and/or by Stupel & Berman. As previously noted, the defendants’
contention is
that the undertaking was revocable at the instance of
AFP on the basis that Stupel & Berman acted as their agent for
the transfer
of the property into the name of the purchaser (CAP). On
the other hand the plaintiff contended that the true nature of the
agreement
is a stand-alone undertaking by Stupel & Berman which
was neither revocable by AFP or Stupel & Berman themselves.
[42] The proper legal construct of
this agreement, in my view, can be gleaned from the schedule attached
to the discounting agreements.
It will be remembered that both
schedules were signed by three parties namely AFP, Stupel &
Berman and Rodel.
63
When doing so, the three parties by mutual consent entered into a
tripartite agreement. The crux of the matter is to establish
the
capacity in which Stupel & Berman became party to this tripartite
agreement.
[43] It is clear that Stupel &
Berman signed the schedule as the party responsible for the transfer
of the property and in the
capacity as agent acting on behalf of AFP,
the seller of the property. In one sense, AFP acted as the principal
and Stupel &
Berman as the agent for the purpose of transferring
the property to CAP and payment of the net proceeds. At common law
such agent’s
authority may freely be terminated by the
principal even if it is stated to be irrevocable.
64
To the aforesaid general rule there are, however, certain exceptions.
These exceptions apply even if the authority granted to the
agent is
not expressed to be irrevocable. One of the recognised exceptions is
where the authority “is coupled with an interest”
65
,
to which I shall return.
[44] The action of the parties in
simultaneously signing the schedule could result in their tripartite
agreement being interpreted
as a stipulatio alterii. It could be
argued that AFP and Stupel & Berman were willing to allow Rodel
by its acceptance of the
schedule to obtain payment of the net
proceeds direct from Stupel & Berman instead of via AFP. However,
whether the parties’
actions are to be regarded as such is not
material for purposes of coming to a conclusion in this matter
66
.
What is of importance is to establish the extent of the respective
rights vis-à-vis one another of the three parties to
the
tripartite agreement.
[45] In answering the aforesaid
question it is helpful to note what was said by Broome and Nienaber
JJ in Consolidated Frame Cotton
Corporation Ltd supra at 25C –
E:
“
There is authority for the
proposition that, where the agent’s authority forms an integral
part of an overall transaction,
be it between the agent and the
principal, or between the agent, the principal and other parties, the
principal is no longer at
liberty to alter or revoke it unilaterally,
at least not, one should perhaps add, if the authority cannot be
severed from the overall
agreement without changing its
sense.”
67
(Emphasis
added)
[46] At common law the third person to
whom payment is authorised (in this case Rodel) was known in the
Roman law as an adiectus
solutionis causa. The adiectus was not
entitled to sue as his right was restricted to the receipt of payment
only, but the right
of the debtor (in this case Stupel & Berman)
to pay the adiectus, when conferred as an integral part of the
contract between
the debtor (AFP) and the creditor (Rodel) could not
ordinarily be revoked. In this regard Pothier in his work
“Obligations”
paragraph 489 lucidly expounded the
position thus:
“
A person to whom the creditor
has indicated the payment to be made by the agreement itself, is very
different from one who has merely
an authority from the creditor to
receive. The power of paying to a person having a simple authority
ceases by revocation of the
authority notified to the debtor, which
the creditor may make at pleasure…
On the contrary, the right of paying
to the person indicated by the agreement being founded upon the
agreement itself, of which
it constitutes a part, and which cannot be
derogated from, but by mutual consent, the creditor cannot deprive
the debtor of it,
and the debtor, notwithstanding any prohibition of
the creditor, may according to the law of the agreement, pay to the
person indicated;…”
68
(Emphasis added)
[47] In order to apply the aforesaid
common law principle to the facts of this case, it is necessary to
understand that Rodel as
an adiectus is a person other than the
creditor (AFP) to whom by agreement between the parties the debtor
(Stupel & Berman
in respect of the net proceeds), is obliged to
pay what is due to the creditor in respect of the net proceeds (AFP).
In regard
to the discounting agreement, Rodel is AFP’s creditor
and AFP the debtor in respect of the repayment of the bridging
finance
plus discounting fees.
[48] In order for the recognised
exception to apply to the tripartite agreement in the present
instance, Rodel and conveyancers
must be shown to have an interest in
the overall contract.
69
In my view, the overall contract is the sale agreement of the Norwood
property which is linked to the two discounting agreements
granting
the seller of the property bridging finance repayable from the net
proceeds of the sale direct to the lender by the agent
of the
borrower. In this contractual arrangement, it is clear that Rodel had
a material interest in the net proceeds which was
to emanate from the
sale of the Norwood property. But for such sale, Rodel would not have
been involved in concluding these discounting
agreements with AFP. It
is also common cause that Rodel had an interest in the payment of the
net proceeds directly to it by Stupel
& Berman in terms of the
instruction by Blumenthal to Stupel & Berman on 25 October 2010
that Rodel is “to be privy
to any documentation pertaining to
this transaction…”
[49] Similarly, Stupel and Berman as
agent of AFP, had an interest in executing the transfer and causing
payment of the net proceeds
correctly in order for it to be lawfully
entitled to its conveyancing fees. Its interest is recorded in the
Conveyancer’s
Undertaking. In terms of clause 1 of this
undertaking, Stupel and Berman are involved in the sale of the
Norwood property. In terms
of clauses 2 and 3 thereof, they warrant
to Rodel that such sale is valid, enforceable in law with no
impediment that would hinder
or delay the transfer. Any breach of
this warranty would necessarily involve Stupel and Berman in a claim
for damages and/or the
loss of their fees. This can only mean that
the conveyancers are aware of the fact that time was of the essence
for Rodel to recoup
the bridging finance and fees, expeditiously.
This is further confirmed by Clause 4 of the undertaking which
records the conveyancer’s
knowledge and understanding of the
agreement between Rodel and AFP, i.e. that it is a discounting
agreement in terms whereof Rodel
had bought the proceeds of the sale
of the Norwood property which would otherwise be due and payable to
AFP. Stupel and Berman
have an interested in expediting the
conclusion of the transaction in order to prevent them from being
held negligent for delaying
the payment of the proceeds. In terms of
clause 6, the conveyancer understands that it is important for Rodel
that the proceeds
of the sale be not reduced by any further
undertakings. Breach of this warranty could potentially also mulct
them in litigation
with Rodel. Clauses 7 and 8 record the fact that
Rodel is entitled to the “full amount payable in terms of the
said discounting
agreement” as determined by a settlement quote
to be supplied by Rodel to the conveyancer. It further records the
“irrevocable
instruction to pay to Rodel from the Proceeds”
such full amount within 72 hours after registration of transfer
occurs. Payment
of the proceeds in breach of this clause would also
place the conveyancers at risk to be sued by Rodel. This obligation
can only
be nullified by “interdict or operation of law.”
It is common cause that no such prohibitive interdict is present in
this case.
[50] In my view, these facts clearly
indicate that the tripartite agreement intended Rodel to be privy to
the sale agreement of
the Norwood property as well as the agency
agreement between AFP as seller and Stupel & Berman as its agent
and conveyancer.
The mere knowledge of the fact that Rodel had taken
cession of the net proceeds stipulated for just above the signature
of the
conveyancer on the schedule as read with clause 4 of the
undertaking, is indicative that Stupel & Berman were aware that
the
net proceeds belonged to Rodel and that Rodel as such had a very
material interest in receiving payment in order for its bridging
finance and discounting fees to be set off against such proceeds
before any outstanding balance is paid over to AFP. The signature
of
the schedule by both Rodel and Stupel and Berman, in my view,
confirms the reciprocal contractual duties between them.
[51] The common law explained as above
and applied to the facts of this case would have entitled Rodel to
claim payment of the proceeds
from AFP’s agent, Stupel &
Berman, even if the undertaking did not stipulate for it to be
irrevocable. By common law
it became irrevocable because of the
interest of both Rodel and the conveyancer in the overall transaction
involving a sale of
immovable property and the grant of bridging
finance coupled thereto. As such, AFP was, at common law, not
entitled to revoke the
authority of Stupel & Berman to make
payment of the net proceeds to Rodel. In my view, the tripartite
agreement concluded between
the parties, overrides the contract of
principal and agent between AFP and Stupel & Berman as far as the
payment of the net
proceeds is concerned. As such, I agree that the
irrevocable undertaking was a “stand-alone” agreement
between Rodel
and the conveyancers. Stupel & Berman was therefore
obliged to refuse AFP’s instruction to withdraw the irrevocable
undertaking
to pay the proceeds to Rodel. Had Stupel & Berman
paid to Rodel the amount of bridging finances plus discounting fees
after
receipt of the settlement quote, it would have extinguished the
debt due by AFP to Rodel. Stupel & Berman would possibly have
a
claim for damages against AFP for having unlawfully instructed it to
withdraw the irrevocable undertaking to pay. Alternatively
Stupel &
Berman could and should have protected its rights by filing an
interpleader notice in terms of Rule 58 of the Uniform
Rules of
Court.
[52] In conclusion it is therefore my
view that in the circumstances of this case, the parties intended the
undertaking to pay direct
to Rodel to be irrevocable both at common
law as well as in terms of the express provisions of the schedule to
the discounting
agreements.
Cancellation of the Agreements
[53] It then becomes necessary to
determine if the Conveyancer’s Undertaking has fallen by the
wayside due to lawful cancellations
of the discounting agreements. As
stated previously in this judgment, I am of the view that the
purported cancellation of the discounting
agreement or agreements by
Rodel is at best ambiguous. Such purported ambiguous cancellation was
not regarded by AFP as an unlawful
repudiation of the discounting
agreements. It merely stated that it accepted the cancellation
without distinguishing whether it
regarded such cancellation to be
effective in regard to one or both contracts. The conduct of AFP
through its attorneys in the
correspondence, clearly indicates that
they intended at most to accept the cancellation only of the first
discounting agreement
dated 31 August 2010.
[54] Furthermore, if AFP wanted to
validly cancel one or both the discounting agreements, it would have
had to tender restitution
of the amounts loaned from Rodel plus
interest thereon as stipulated in clause 8 of the Terms and
Conditions. As previously stated,
this clause survives any
cancellation or purported cancellation. The rights of the parties are
to be determined solely by reference
to the extant agreement.
70
Failure to tender such return, rendered its purported acceptance of
the ambiguous cancellation invalid. Failure to tender or explain
why
no tender is made, makes AFP’s claim that the contracts were
properly cancelled fatally defective.
71
[55] Can an ambiguous cancellation of
a contract be “accepted” by the other contracting party?
Based on basic principles
of the law of contract any consensual
cancellation of a contract is subject to the parties’ minds
meeting. In my view the
parties’ minds could never have met
correspondingly where the purported cancellation is ambiguous and the
alleged “acceptance”
thereof does not eradicate any
ambiguity. I therefore hold that there was no valid cancellation of
the first discounting agreement.
However, even if I am wrong in this
conclusion, then at very best, the second contract was never
cancelled.
[56] That being the case, I am of the
view that the defendants cannot rely on the cancellation or purported
cancellation by Rodel
as the basis for alleging that the
conveyancer’s undertaking terminated by operation of law. In my
view, the two contracts
were severable, each with their own terms and
conditions and for differing amounts serving a specific purpose
72
.
Neither party argued the contrary.
[57] The fact that Rodel’s
representative Mr Jacques Morkel regarded the cancellation to have
been in respect of both contracts
is neither here nor there. What his
personal view may have been is irrelevant. The conduct of the parties
has to be gleaned from
their outward conduct. At no stage did the
parties’ minds meet that both contracts were cancelled other
than a unilateral
allegation to that effect by Mr Jacques Morkel. In
my view, the circumstances of this case are insufficient for a
conclusion that
both discounting agreements were cancelled. The
contention by the defendants that there was such a cancellation is
therefore rejected
on the papers.
The Cession
[58] The argument advanced by counsel
for the defendants that there was a partial cession which was
unenforceable in law, is not
convincing. On the one hand the
defendants wish to extricate themselves from the effects of the terms
and conditions of the discounting
agreements by alleging that the
terms and conditions were never presented to them
73
,
but on the other they wish to rely upon clause 1.7 of the terms and
conditions stating that the claim which was ceded constituted
“a
portion of the proceeds as set out in the schedule”. In my view
the defendants cannot reprobate and approbate. In
any event, if one
looks at the schedule, it is clear that “the Proceeds” is
a net amount after deduction of certain
other amounts. It is not a
“portion” of the proceeds.
[59] Furthermore, in terms of clause
5.19 of the terms and conditions of contract, AFP warranted to Rodel
that such claim was not
subject to a prior cession, pledge or similar
encumbrance. If the defendants wished to rely on clause 1.7, then
such clause is
to be read in the light of the warranty contained in
clause 5.19 plus the statement that any breach of such warranty will
constitute
a fraud against Rodel as stated in the last portion of
clause 5. To allow the defendants to rely upon a partial or prior
cession
would constitute a fraud on Rodel which this court cannot
countenance.
[60] The argument by the defendants’
counsel that Rodel is estopped from denying that it had cancelled the
agreements can
also not be accepted. Rodel was entitled to pursue its
remedies against AFP and Blumenthal. In doing so, no representation
was
made that it had forsaken its remedies against the defendants.
The remedy against the defendants in terms of the undertaking was
not
agreed to as an alternative to the remedies against AFP and
Blumenthal in terms of the discounting agreements. If they were
in
the alternative, an argument could have been entertained that opting
for one may have excluded reliance on the other. In any
event, the
defendants changed their position by paying the proceeds to AFP not
because of Rodel’s conduct in pursuing its
remedies against AFP
and Blumenthal. The defendants changed their position because of
adhering to what they perceived to be a lawful
instruction to
withdraw from the undertaking received from AFP. In these
circumstances estoppel cannot therefore be applied against
Rodel to
prevent it from suing the defendants.
CONCLUSION
[61] I am of the view that the
contentions of Rodel in the stated case are sound and should be
upheld whereas those by the defendants
are to be rejected. I do,
however, agree that no case has been made out against Mr Berman
personally. It is clear from clause 12
of the undertaking that he
signed it not in his personal capacity but on behalf of his firm, the
first defendant.
[62] I therefore find in favour of the
plaintiff and make the following order:
a. Judgment is entered against the
first defendant in the amount of R1 763 489.00 plus
interest at the rate of 15.5% per
annum as from 18 March 2011 to date
of payment.
b. Costs of suit which are to include
the costs consequent upon the employment of two counsel wherever
applicable.
c. The second defendant is absolved
from the instance with costs which are to include the costs of two
counsel where applicable.
DATED THE 28TH DAY OF October 2013
AT JOHANNESBURG
________________
C. J. CLAASSEN
JUDGE OF THE HIGH COURT
Counsel for the Plaintiff: Adv R. A.
Solomon SC
Adv E. L. E. Myhill
Counsel for the Defendants: Adv B.
Berridge SC
Adv B. Manentsa
Attorneys for the Plaintiff: Webber
Wentzel
Attorneys for the Defendants: Norman
Berger and Partners Inc
The trial was conducted from 8 October
2013 to 9 October 2013
1
For a more legible copy of the terms and conditions, see Exhibit “A”
pp. 101 – 107
2
For a more legible copy of these two documents, see Exhibit “A”
pp. 99 – 100
3
See Exhibit “A” p. 66. Tamryn Flowers and Tammy Hall
might be the same person.
4
See Exhibit “A” p. 50B
5
See Exhibit “A” p. 58
6
See the Auction Sale Agreement, Exhibit “A” pp. 1 –
12
7
See Exhibit “A” pp. 15A, 46 and 57
8
See Exhibit “A” p. 10
9
See Exhibit “A” p. 42A paragraph 3.1
10
See Exhibit “A” p. 55
11
See Exhibit “B” p. 87A
12
See Exhibit “A” p. 14, a letter dated 23 March 2010 from
Mercantile Bank Ltd to Stupel and Berman Inc in their capacity
as
the conveyancing attorneys responsible for the cancellation of the
bond registered over the immovable property.
13
See Exhibit “A” p. 16 where Mr Berman signed as
“Conveyancer (for transfer duty/rates, Attorney in his
capacity
as Conveyancer and as duly authorised representative of the
Client” (AFP); p. 17 where he signed the discounting
application
form; p. 18 where he signed above the words “Signature
of Conveyancer”.
14
See Exhibit “A” p. 50C
15
See Exhibit “A” p. 55
16
See Exhibit “A” p. 59
17
See Exhibit “A” p. 76A
18
See Exhibit “A” p. 77
19
See Exhibit “A” pp. 16 and 20
20
See Exhibit “A” p. 43
21
See Exhibit “A” p. 43
22
See Exhibit “A” pp. 16 and 45. In clause 2 of the
agreements, these cessions are repeated to which reference will
be
made later in this judgment.
23
See Exhibit “A” p. 20. In terms of clause 1.23 of the
Terms and Conditions, it is recorded that Rodel signed the
Schedule
24
See Exhibit “A” p. 21 in respect of the first
discounting agreement and p. 46 in respect of the second discounting
agreement
25
See Exhibit “A” pp. 18 and 44
26
See clauses 1.7, 1.17, 2.1, 2.2, 2.3 and 4.2 of the discounting
agreement as read with paragraph 6 of the schedule, “Calculation
of Proceeds”, and clause 7 of the Conveyancer’s
Undertaking
27
See paragraph 6 of the schedule
28
See Exhibit “A” pp. 16 and 45
29
See clause 2.3
30
See clause 2.3 of the discounting agreement as read with clause 7 of
the undertaking by Mr Berman.
31
See clauses 5.10, 5.12 as read with the schedule which calculates
the discounting fee not on an annual basis but on a daily basis.
This suggests that the loan plus discounting fees were due to be
repaid within 90 days
32
See clause 5.14 of the discounting agreement
33
See clause 5.19 of the discounting agreement
34
See the last unnumbered portion of clause 5 of the agreement
35
See clauses 8.1.3 and 8.2 of the agreement
36
See clause 10 of the Conveyancer’s Undertaking
37
See Exhibit “A” p. 58
38
See Exhibit “A” p. 59
39
See Exhibit “A” p. 63
40
See Exhibit “A” pp. 64-5
41
See Exhibit “A” p. 95
42
See Exhibit “A” p. 68
43
See Exhibit “A: pp. 70 and 71
44
See Exhibit “A” p. 74
45
See Exhibit “A” p. 75
46
See Exhibit “A” p. 76A
47
See Exhibit “A” p. 76B
48
See Exhibit “A” p. 77
49
See Exhibit “A” pp. 78 and 78A
50
See Exhibit “A” p. 80
51
See Exhibit “A” pp. 78 and 78A
52
See Exhibit “C” p. 1
53
See Exhibit “C” p. 5
54
See the Stated Case
infra
paragraph 1.34
55
See Exhibit “C” p. 33
56
See Exhibit “C” pp. 36-7
57
See Exhibit “A” p. 84
58
See Exhibit “A” p. 92
59
See Exhibit “A” p. 85
60
See Exhibit “A” pp. 87 – 89
61
See Exhibit “A” p. 93
62
See Annexure “B” which contains all the pleadings
including a replication and rejoinder as well as further particulars
for trial
63
See Exhibit “A” p. 20
64
See
Joel Malamed and Hurwitz v Cleveland Estates (Pty) Ltd; Joel
Malamed and Hurwitz v Vorner Investments (Pty) Ltd
[1984] ZASCA 4
;
1984 (3) SA
155
(A) at 171D – G;
The Firs Investment Ltd v Levi Bros
Estates (Pty) Ltd
[1984] ZASCA 20
;
1984 (2) SA 881
(A) at 886D;
Pretorius v
Erasmus
1975 (2) SA 765
(T)
65
See
Natal Bank Ltd v Natorp and Registrar of Deeds
1908 (TS)
1016;
Ward v Barrett NO and Another
1962 (4) SA 732
(N) at
737;
Consolidated Frame Cotton Corporation Ltd v Sithole and
Others
1985 (2) SA 18
(NPD) at 22I – 23A per Broome and
Nienaber JJ
66
See
Estate Greenberg v Rosenberg and Greenberg
1925 TPD 924
at 929 – 930 where it also was found unnecessary to analyse
the transaction within the perimeters of a particular kind
of
contract
67
See also
Administrator, Natal v Magill, Grant & Nell (Pty)
Ltd (in Liquidation)
1969 (1) SA 660
(A) at 669B – F
68
As quoted in
Norman Kennedy v Norman Kennedy Ltd; Judicial
Managers, Norman Kennedy Ltd NO v Reinforcing Steel Co, Ltd and
Others
1947 (1) SA 790
(CPD) per Ogilvie Thompson AJ at 802;
Cassim v Latha
1930 TPD 659
69
See
Kopman and Another v Benjamin
1951 (1) SA 822
(W) at 886
70
See
Cash Converters Southern Africa (Pty) Ltd v Rosebud Western
Province Franchise (Pty) Ltd
2002 (5) SA 494
(SCA) at 502H
71
See
Sackstein NO v Proudfoot SA (Pty) Ltd
2006 (6) SA 358
(SCA) at par [11] p. 362G – 363B
72
See
Cash Converters
supra
Para. [23] p. 502
73
See paragraph 1.7 of the stated case