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[2014] ZAGPJHC 384
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Trencon Construction (Pty) Ltd v South African Airways (Pty) Ltd and Another (17452/13) [2014] ZAGPJHC 384 (7 November 2014)
REPUBLIC OF SOUTH
AFRICA
SOUTH GAUTENG HIGH
COURT
JOHANNESBURG
CASE NO: 17452/13
DATE: 07 NOVEMBER 2014
In the matter between:
TRENCON CONSTRUCTION (PTY)
LTD
.....................................
Applicant
And
SOUTH AFRICAN AIRWAYS (PTY)
LTD
..........................
First
Respondent
FOCUS PROJECT
MANAGEMENT
...............................
Second
Respondent
JUDGEMENT
CARSTENSEN AJ:
1. The Applicant seeks payment from the
First Respondent in the amount of R552 040.38 alternatively, that the
Second Respondent
be ordered to issue a final payment certificate in
the aforesaid amount.
2. At the outset, both the First
Respondent’s counsel, Ms H. Mutenga and the Second Respondent’s
counsel, Ms S Swartz
moved for an order that the application be
stayed as a consequence of the arbitration clause and that this
application be referred
to arbitration.
3. I refused the application in the
exercise of my discretion and for the reasons given, but in
particular that the Respondents
had waited until the hearing of the
matter to move the application, the First Respondent in fact had
sought, at no stage prior
to the hearing of the application, for such
an order apart from referring the arbitration clause in its affidavit
and that in fact,
in terms of the arbitration clause, neither of the
Respondents had given a notice of dissatisfaction.
4. On the 18th of September 2009 the
Applicant and First Respondent had concluded a written construction
agreement for the construction
of a departure lounge at the OR Tambo
International Airport and the Second Respondent was appointed as the
principal agent in respect
of the works.
5. There was no dispute as to the
conclusion or terms of the contract or as to the amount which
remained unpaid, as to the Applicant’s
invoice or that the work
reflected on the invoice had been done.
6. It was also conceded by the
Applicant that the Second Respondent, as principal agent, had not
issued a certificate of final completion.
7. The Respondents contended that there
were defects in the works and these had to be remedied before a
certificate of final completion
could be issued.
8. It was however, common cause that
the defects were not caused by the Applicant, but by a contractor who
had preceded the Applicant.
The First Respondent pointed out that
the appointment of the Applicant followed on the liquidation of the
first contractor, T
L Steward, which resulted in both the quantity
surveyor and principal agent for the project being replaced.
9. At the time when the Applicant took
as contractor, the design, manufacture and installation of the shop
fronts, now alleged to
be defective, had already been done by the
previous contractor, T L Steward. The Respondent’s contended
there were outstanding
issues regarding both the design and the
glazing of the shop fronts which were not according to the requisite
standards.
10. Both the First and Second
Respondents argued that the Applicant was not entitled to payment as
it had not complied with its
obligations, as in terms of the written
agreement, particularly clause 8: “8.2 The contractor shall
make good any physical
loss and repair damage to the works, including
clearing away and removing from site, all debris resulting therefrom,
which occurs
after the date on which the possession of the site is
given and up to the issue of the deemed certificate of final
completion and
resulting from …”.
11. In terms of clause 8.5 of the
agreement, the contract provided “the contractor shall not be
liable for the cost of making
good any physical loss or repairing any
damage of works where this resulted from the following circumstances:
… 8.5.9 design
of the works where the contractor is not
responsible in terms of 4.0. It was common cause that the Applicant
was not responsible
for the design of the works in respect of which
the Respondents’ complained.
12. The arguments of the Respondents
thus critically relied on clause 8.2. There was also no question in
my mind that the phrase
“including clearing away and removing
from site all debris resulting therefrom” related to the making
good of the loss
or repairing the damage and was irrelevant for the
purposes of the issue before me.
13. Consequently, 8.2 in my view can be
read simply as follows: “The contractor shall make good the
physical loss and repair,
damage to the works … which occurs
after the date on which possession of the site is given ….
14. There is no question and neither
party contends that the loss or damage occurred after the date on
which possession was given
to the Applicant.
15. It is indeed common cause that
after T L Steward was replaced the Applicant concluded the agreement,
namely the JBCC Principle
Building Agreement on the 18th of September
2009, was appointed in terms thereof and took possession of this
works as a consequence
thereof.
16. I do not agree with either
Respondents that it is the Applicant’s responsibility,
consequently, to make good the loss
or repair the damage in question.
There is no other provision of the agreement which renders the
Applicant liable to repair the
defects.
17. It was also argued that the clear
intention of the First Respondent was to have the works completed and
thus if could not have
been intended by the parties that, despite the
appointment of the Applicant to complete the works, the Applicant
“could receive
payment without the works having been
completed”. This argument, however, does not accord with the
intention of the parties
as appears from the written terms of the
agreement. There is also no question that the clause in question is
ambiguous.
18. The Applicant argued that the
question of the defects is, in light of the provisions of the
agreement, in any event irrelevant.
This is due to the fact that:
18.1. it was common cause that the
Second Respondent had issued a certificate of completion of works on
the 1st of February 2012;
18.2. in terms of clause 26.1, the
defects liability period being a 90 day calendar day period, had thus
commenced on the 1st of
February 2012 and terminated on the 2nd of
May 2012;
18.3. in terms of clause 26.2, the
Second Respondent was required at the end of the defects liability
period to inspect the works
and issue a certificate of final
completion;
18.4. if the Second Respondent was of
the view that the works have not reached final completion, then the
Second Respondent was
obliged forthwith to issue a defects list. No
such defects list was issued.
18.5. in terms of clause 26.4 as a
consequence of the fact that no defects list was issued, the
Applicant notified both parties
that there had been a failure to
issue a defects list.
18.6. The Second Respondent was then
obliged within a further 7 days to issue a defects list. The Second
Respondent did not issue
any defects list within this further period,
or at all.
18.7. Consequently, in terms of clause
26.4, the certificate of final completion is deemed to have been
issued and final completion
is deemed to have been achieved on that
date.
19. Thus, at least, final completion of
the works is deemed to have been achieved on the 8th of October 2012
and the certificate
of final completion is deemed to have been issued
on that date.
20. Both Respondents argued that it was
clear from the e-mails which had passed between the parties over a
protracted period of
time that all parties were aware of the issues
relating to the glazing of the departure lounge. This takes the
matter no further
in my view.
21. It was not a question as to whether
the parties were aware of the defects but the question is what the
Applicant was obliged
to attend thereto under the contract.
22. It is also clear from the
provisions of the agreement that:
22.1. the Applicant was not obliged to
make good the loss or repair the damage; and
22.2. final completion had been
achieved as a consequence of the deeming provision.
23. It matters not that the Applicant
was aware of the defects, as it is quite clear that the Applicant is
not liable to repair
same which defects occurred prior to the
conclusion of the agreement and prior to the Applicant taking
possession of the works.
24. Although it was also argued by the
Respondents that there was a dispute of fact, there certainly was no
dispute of fact on the
aspects which are set out above.
25. In the premises, I am satisfied
that the Applicant is entitled to the relief which it seeks
particularly in view of the fact
that a certificate of final
completion is deemed to have been issued.
26. Consequently, I make the following
order:
26.1. the First Respondent is ordered
to pay the Applicant the amount of R552 040.38 within 10 days from
date of this order;
26.2. The First Respondent is ordered
to pay the Applicant’s costs.
P L CARSTENSEN
ACTING JUDGE OF THE
HIGH COURT
HEARD: 15th OCTOBER 2014
DELIVERED: 7th NOVEMBER 2014
COUNSEL FOR APPLICANT: ADV. J BOTH
SC
INSTRUCTED BY: GARRATT HUGO & DE
SOUZAINC.
COUNSEL FOR 1st RESPONDENT: ADV. H.
MUTENGA
ADV. S. SWARTZ
INSTRUCTED BY: MOLOTO STOFILE INC.
(jmt.30.5.13)