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[2020] ZAGPJHC 407
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Blue Crest Holdings (Pty) Ltd v Body Action Health Clubs (Pty) Ltd (2020/39156) [2020] ZAGPJHC 407 (14 December 2020)
IN THE HIGH COURT OF
SOUTH AFRICA
(GAUTENG
LOCAL DIVISION, JOHANNESBURG)
CASE
NO: 2020/39156
NOT
REPORTABLE
NOT
OF INTEREST TO OTHER JUDGES
REVISED
In
the matter between:
BLUE
CREST HOLDINGS (PTY)
LTD
Applicant
and
BODY
ACTION HEALTH CLUBS (PTY) LTD
Respondent
JUDGMENT
McLEAN
AJ:
Introduction
1.
This is an urgent application
for the
eviction of the Respondent from its business premises in Bedfordview
(“
the premises”
).
The Respondent’s
occupation
of the
premises is in terms of a lease agreement concluded between the
parties in September 2019 (“
the
lease agreement”
). The premises
is currently being occupied by the Respondent for commercial
purposes, for use as a gymnasium.
2.
The Respondent’s business has been
severely impacted by the Covid-19 pandemic and the Respondent has not
paid the Applicant
anything since 21 July 2020. The Respondent’s
difficulties, however, appear to have begun earlier that that,
although there
is a dispute as to whether the Respondent short paid
on its rental prior to the lockdown period.
3.
As at 1 November 2020, the Applicant
contends that the Respondent owes it an amount of R830 134,09 in
terms of the lease agreement.
In addition, it appears to be common
cause that the Respondent owes the Applicant a further R2 405 563,33
in terms of
a previous lease agreement between the parties.
4.
The Applicant seeks the Respondent’s
eviction on two bases, either of which is sufficient to terminate the
lease agreement:
4.1.
first, the Applicant contends that it
validly cancelled the lease agreement on 24 June 2020, based on the
Respondent’s repudiation
in failing to pay all amounts
due
in terms of the lease agreement, and after the
Respondent’s failure to remedy the breach upon notice by the
Applicant giving
it an opportunity to do so in accordance with the
lease agreement; and
4.2.
second, the Applicant asserts that even if
the lease was not validly terminated on 24 June 2020, the lease
terminated through the
effluxion of time on 31 October 2020.
5.
The Respondent contends that the lease was not validly terminated on
24
June 2020, and raises disputes of fact on the papers as to whether
the Respondent underpaid the full amounts due or not. The
Respondent’s
version is that far from being in arrears, the
Respondent is in fact in credit as a result of the Applicant
overcharging it on
several occasions, and the Applicant was not
entitled to cancel the lease agreement. For the reasons which follow,
it is not necessary
for me to decide this aspect, as I conclude that
the lease agreement – if still in existence at that point –
would
have terminated on 31 October 2020.
6.
Before dealing with this ground of termination of the lease
agreement, I deal with the question of urgency.
Urgency
7.
The relevant time line for determining urgency is as follows:
7.1.
on 3 June 2020, the Respondent was put on terms to rectify its breach
as a result of non-payment;
7.2.
after no response was received to the Applicant’s letter of 3
June 2020 and the breach
was not rectified, the Applicant then sent a
second letter on 24 June 2020, indicating its election to cancel
the lease agreement,
and demanding that the Respondent vacate the
premises by 30 June 2020;
7.3.
between 28 May 2020 and 26 August 2020, the parties engaged in
“
without prejudice
” settlement discussions which
ultimately failed to resolve the dispute;
7.4.
on 18 September 2020, the Applicant confirmed the cancellation, but
granted the Respondent
a “grace period” to vacate the
premises until 31 October 2020, failing which it would bring this
urgent eviction application;
7.5.
on 2 November 2020, the Respondent advised the Applicant that it
would remain in occupation
until its new premises were complete and
would not vacate the premises; and
7.6.
this application was issued on 18 November 2020, but only served
formally on the Respondent
on 20 November 2020.
8.
The Applicant contends that the matter is urgent because:
8.1.
it is already but of pocket, and if the Respondent is not evicted
urgently, the Respondent
will continue to accrue debt until the
Respondent vacates the premises;
8.2.
there is a risk that the Respondent may be liquidated without prior
notice being given
to the Applicant of a liquidation application, as
occurred with the Respondent’s predecessor, and that the
Respondent is
in a vulnerable financial position following the
effects of Covid-19 on its business;
8.3.
the Respondent’s continued occupation means that the Applicant
is unable to find
an alternative tenant to occupy the premises.
9.
This Court has previously found in
Twentieth
Century Fox Corporation and Another v Anthony Black Films (Pty) Ltd
1982 (3) SA 582
(W) at 586G,
that
commercial interests may justify the use of urgent proceedings, and
this aspect is correctly not contested by the Respondent.
10.
Instead, the Respondent disputes the
urgency of the matter on the grounds that:
10.1.
the Applicant would have access to substantial relief in the form of
a damages claim were this matter to
be heard in the ordinary course;
10.2.
it told the Applicant as early as 23 July 2020 that it would not be
vacating the premises at the end of
October 2020, and any urgency in
these proceedings is accordingly self-created;
10.3.
it has tendered its vacation of the premises by 1 May 2021; and
10.4.
it has been prejudiced by the curtailment of time frames in
these proceedings
.
11.
On the first issue raised by the Respondent, this objection is
misplaced. The
relief sought is not for an interdict, and the
Applicant does not need to satisfy this Court that it has no
alternative remedies
available. The relief sought is for specific
performance in terms of the lease agreement, namely, the return of
the premises upon
the expiry of the lease agreement (see
Manley
Van Niekerk (Pty) Ltd (Now Video Sound Studios (Pty) Ltd) v Assegai
Safaris And Film Productions (Pty) Ltd
1977
(2) SA 416
(A) 422H–423A). The fact that the Applicant may have
an alternative damages claim is not relevant to whether the relief
sought
is urgent.
12.
As to the second of the Respondent’s objections, I find that
the Respondent’s
statement in its letter of 23 July 2020 is at
best ambiguous. The Respondent wrote that: “
Our client
hereby notifies your client that it is unable to vacate the premises
due to the global pandemic at the end of the lease
term.
”
13.
The Applicant states that it did not interpret that statement to mean
that the
Respondent refused to vacate the premises prior to 1 May
2021 in any circumstances, and interpreted the Respondent’s
statement
to mean that under the restrictions as they stood on 23
July 2020, the Respondent was unable to move its business. That
restriction
fell away on 17 August 2020. I am in agreement with the
Applicant that at this point (23 July 2020) there was no unequivocal
indication
by the Respondent that it would refuse to vacate the
premises prior to 1 May 2021.
14.
In any event, the question of whether a matter is urgent is answered
by determining
whether an applicant may be afforded substantial
redress in the ordinary course or not. If not, then the matter is
urgent. A delay
by an applicant in instituting proceedings is, in
itself, not sufficient to determine that a matter is not urgent –
although
it may be an indication of whether an applicant is able to
be given substantial redress in the ordinary course. A delay might
also
be occasioned by the parties attempting to settle the matter.
(See
Stock and Another v Minister of Housing and Others
2007
(2) SA 9
(C) at 12 I – 13A; and
East Rock
Trading 7 (Pty) Ltd and another v Eagle Valley Granite (Pty) Ltd and
others
2011 JDR 1832 (GSJ) at paras 7
and 8.)
15.
In this matter, while the Applicant may be criticised of some
tardiness in November
2020, any delay in launching this Application
would not have affected the essentially urgent nature of the relief
sought. Similarly,
the period from 28 May 2020 to 26 August 2020
where the parties sought to reach a settlement agreement, and the
“grace
period” afforded the Respondent does not undermine
the urgent nature of the relief sought.
16.
The third ground on which the Respondent opposes urgency, is on the
basis that
it has tendered to vacate the premises by 1 May 2021. I
deal with the Respondents tender from paragraph 34 below as it is not
relevant
to the question of whether the application is properly
urgent.
17.
And fourth, the Respondent opposes urgency on the basis that it was
prejudiced
by the curtailed time periods afforded to it by the
Applicant to file its Answering Affidavit. This assertion of
prejudice, however,
is not made in the Answering Affidavit and the
Respondent managed, in the time afforded to it, to file an 81-page
Answering Affidavit
in response to the Applicant’s 25-page
Founding Affidavit. The Respondent was afforded six days to file its
Answering Affidavit
and, in fact, filed its Answering Affidavit on 2
December 2020, two days after the date specified in the Notice of
Motion. Given
the urgency of the matter, I do not find that the
period afforded to the Respondent to file its Answering Affidavit was
unreasonable.
18.
In the circumstances, I am satisfied that the matter is urgent.
Expiry
of the Lease Agreement
19.
Clauses 11.3 and 12.1 of the lease agreement make it clear that the
lease agreement
runs for 14 months and terminates on 31 October 2020.
The “
right of renewal
” clause was deleted by the
Respondent on signature.
20.
Clause 40.1 of the lease agreement also contains a standard “
no
variation clause
”.
21.
The Respondent contends that the written terms of the lease agreement
are not
exhaustive of the agreement, and that it was the parties’
intention for the lease to run for a period of
at least
14
months, and that the Respondent would be entitled to remain in
occupation until the alternative premises it was building were
completed. In this respect (and in other respects), the Respondent
assets that the lease agreement was partly written, partly oral.
22.
The Applicant contends, correctly in my view, that it is not open to
the Respondent
to rely on an alleged oral or tacit term on the lease
agreement, as it is precluded from doing so in terms of the parol
evidence
rule. In terms of that rule, a party is excluded from
leading any extrinsic evidence which contradicts or alters the
express terms
of a written agreement.
23.
In the well-known decision of
Johnston v Leal
1980 (3) SA 927
(A) at 942I – 943G, Corbett JA explained the parol evidence
rule as follows:
“
As has been
indicated, the parol evidence rule is not a single rule.
It in fact branches
into two independent rules, or sets of rules: (1) the integration
rule, described above, which defines the limits
of the contract, and
(2) the rule, or set of rules, which determines when and to what
extent
extrinsic
evidence may be adduced to explain or affect the meaning of the words
contained in a written contract:
see, for example, the exposition by SCHREINER JA in
Delmas
Milling Co Ltd v Du Plessis
1955
(3) SA 447
(A)
at
453 - 5. (For convenience I shall call this latter rule "the
interpretation rule".) Neither rule, in my opinion, affects
the
matter under consideration.
Dealing first with the
integration rule, it is clear to me that the aim and effect of this
rule is to prevent a party to a contract
which has been integrated
into a single and complete written memorial from seeking to
contradict, add to or modify the writing
by reference to extrinsic
evidence and in that way to redefine the terms of the contract. The
object of the party seeking
to adduce such extrinsic evidence is
usually to enforce the contract as redefined or, at any rate, to rely
upon the contractual
force of the additional or varied terms, as
established by the extrinsic evidence. On the other hand, in a case
such as the present,
where ex facie the document itself the
contract appears to be incomplete, the object of leading extrinsic
evidence is
not to contradict, add to or modify the written
document or to complete what is incomplete so that the contract may
be enforced
thus completed, but merely to explain the lack of
completeness, to decide why the parties left blanks in a particular
clause and
what the integration actually comprises, and in this way
to determine whether or not the document constitutes a valid and
enforceable
contract and is in conformity with s 1 (1) of the Act.
Consequently, it does not seem to me that the admission of such
extrinsic
evidence for this purpose in a case of the kind presently
under consideration would be either contrary to the substance of the
integration rule or likely to defeat its objects.
To sum
up, therefore, the integration rule prevents a party from altering,
by the production of extrinsic evidence, the recorded
terms of an
integrated contract in order to rely upon the contract as altered
;
the evidence which it is suggested could be adduced in this case
would be to explain an overt lack of completeness in the document
and
at the same time to determine what has been integrated with a view to
deciding upon the validity of the document as it stands.
”
24.
Mr Ferreira, for the Respondent, contended that the parol evidence
rule was
not applicable, as there were a number of terms deleted by
the parties in the lease agreement; and the lease was for a period of
14 months, which is an unusual period.
25.
Having considered the terms deleted in the contract, I do not find
the written
agreement to be incomplete or to lack any of the
essentialia of a lease agreement. There is therefore no basis on
which parol evidence
may be allowed to fill in the blanks or to
decide whether there is a valid and enforceable agreement in
existence. As for the contention
that 14 months is an unusual period,
this is irrelevant; it is not for the Court to contradict the
parties’ express intentions.
26.
Mr Ferreira for the Respondent also asserted that the parol evidence
rule does
not apply in circumstances where one of the parties did not
sign the contract (as is the case here where the Applicant did not
sign the lease agreement).
27.
In response, Ms Stein referred to me to
Rielly
v Seligson and Clare Ltd
1977 (1) SA
626
(A) at 637, where Holmes JA held that:
“
If it has a
plain meaning, the Court cannot vary it by reference to oral
evidence. The law is definite on this point. That is why
people have
written contracts: so that he who runs may read. As was said by
WATERMEYER, J.A., in
Union Government v Vianini
Ferro-Concrete Pipes (Pty.) Ltd
.,
1941 AD 43
at p. 47:
‘
Now this Court
has accepted the rule that when a contract has been reduced to
writing, the writing is, in general, regarded as the
exclusive
memorial of the transaction and in a suit between the parties no
evidence to prove its terms may be given save the document
or
secondary evidence of its contents, nor may the contents of such
document be contradicted, altered, added to or varied
by parol
evidence.’
That this is still the
law in South Africa is indicated by the reliance placed on that
passage by this Court in
National
Board (Pretoria) (Pty.) Ltd. and Another v Estate Swanepoel
,
1975
(3) SA 16
(AD)
at
p. 26A.
In this Court, counsel
for the appellant contended that the letter of appointment, followed
by the employment of the appellant,
constituted or was accepted
by the parties as their written contract, even though the appellant
himself did not sign it. Counsel
for the respondent contested this
submission. As to that, the principle seems to be clear. In an
unreported judgment of the Transvaal
Provincial Division in Union
Bank of South Africa Ltd. v Schatz in April 1940, SOLOMON,
J., said crisply:
‘
The rule is
that where parties intend a document signed by only one of them to
represent the contract between them no parol evidence
to vary that
document can be admitted.’
This was quoted with
approval by FISCHER, J.P., in
Gordon
Wilson (Pty.) Ltd. v Barkhuizen
,
1947
(2) SA 244
(O)
at
p. 250.
”
28.
The parol evidence rule is thus applicable to the lease agreement,
even in circumstances
where it is not signed by the Applicant.
29.
In these circumstances, it is not open to the Respondent to rely on
extrinsic
evidence which contradicts the express terms of the lease
agreement as to the duration of the lease agreement.
30.
Mr Ferreira urged me, in oral argument, to find in favour of the
Respondent’s
version on the partly written, partly oral lease
agreement, and stated that in order for me to find in favour of the
Applicant,
I would have to disbelieve Mr Roets’ version of the
partly written, partly oral agreement set out by him in the Answering
Affidavit.
31.
This is not correct: I do not have to find that Mr Roets has lied on
oath. On
the contrary, I am precluded by the parol evidence rule from
considering the evidence put up by Mr Roets insofar as it contradicts
the express terms of the written lease agreement. In doing so, I make
no findings on the truth or otherwise of Mr Roet’s
version. I
simply cannot consider them.
32.
Similarly, Mr Ferreira’s submissions that – on the basis
of the
test formulated in
Plascon-Evans
– I must find in
favour of the Respondent, must be rejected. For purposes of this
Application, I am precluded from considering
extrinsic evidence with
contradicts express written terms of the lease agreement.
33.
For these reasons, I find that the lease agreement terminated through
the effluxion
of time on 31 October 2020, and that the Respondent’s
continued occupation of the premises is unlawful.
The
Respondent’s Tender
34.
On 26 November 2020, after these proceedings were instituted, the
Respondent
tendered to vacate the premises on 1 May 2021, and to pay
to the Applicant what is due and owing on the conclusion of a
statement
and debatement.
35.
This tender was amplified in the course of the hearing, where the
Respondent
tendered to pay rental in a lesser amount of approximately
R40 000 per month to the Applicant, which it contends is
commensurate
with the restrictions placed on its ability to conduct
its business. This amount is less than half of the amount stipulated
in
the contract of lease.
36.
As Ms Stein pointed out, however, the tender is not for the payment
of full
rental or amounts due in terms of the lease agreement, and
the tender is, in any event, refused by the Applicant.
37.
In the light of the refusal of the tender – which the Applicant
was under
no contractual obligation to accept – the tender
plays no further role and is irrelevant to the determination of this
Application.
Remedy
38.
The Respondent contends that even if this Court is to grant an order
of eviction,
the Respondent is entitled to reasonable notice to
vacate the premises, and that a reasonable period would be six
months.
39.
Mr Ferreira referred me to the decision in
AJP Properties CC v
Sello
2018 (1) SA 535
(GJ) at paras 14 – 17, where Spilg J
held that:
“
[14]
It is trite that under ordinary commercial-law principles of lease a
tenancy in respect of which rental
is payable monthly becomes
terminable on one calendar month's notice. Accordingly to suggest
that a clause that mirrors the
common law is contra bonos
mores would be far-reaching. It may also raise issues of
inequality of treatment if the lessor
cannot claim a similar
ground for relief if the roles were reversed.
[15]
However, that does not conclude the enquiry. The issue is a legal one
based on the facts presented
and the parties were requested to
specifically address it.
[16]
There however appear to be a number of legal factors that
have application. The first is
that, even though under common
law a residential tenancy is similarly terminable on one calendar
month's notice if rental is payable
monthly and the lease has been
lawfully terminated, our courts exercise a residual power when
granting an eviction order to give
the tenant a reasonable time to
vacate, and this may be for a longer period than one month after the
order is made. I should preface
this part by indicating that I am
only concerned with the common-law position to the exclusion of the
Prevention of Illegal Eviction
from and Unlawful Occupation of Land
Act 19 of 1998.
[17]
Although the court has no equitable jurisdiction to decline the
grant of an eviction order it
has nevertheless given the
erstwhile tenant time within which to vacate. The following cases are
mentioned by Cooper Landlord
and Tenant op cit at 375 –
6 under the topic 'Stay of execution';
Voortrekker
Pers Beperk v Rautenbach
1947
(2) SA 47
(A)
;
Lovius
and Shtein v Sussman
1947
(2) SA 241 (O)
;
Van
Reenen v Kruger
1949
(4) SA 27
(W)
;
E Graaff-Reinet
Municipality v Mkwane
1950
(3) SA 883 (E)
;
and
Woudstra
v Jekison
1968
(1) SA 453
(T)
at
458B. In the last two cases the discretion was considered exercisable
in a magistrates' court (which is a creature of statute
and therefore
devoid of inherent jurisdictional powers). The author also referred
to Jones & Buckle The Civil Practice
of the Magistrates'
Courts in South Africa 11 ed vol 1 (Juta) at 622.
”
40.
The Applicant, by contrast, contends that three days notice would be
reasonable.
The Applicant also points out that in the
Sello
matter, the Respondent was still paying rental; while in this
case it is not. Ms Stein urged me, in these circumstances, to
consider
not only the prejudice to the Respondent, but also to the
Applicant, which is presently not receiving any rental.
41.
In its Answering affidavit, the Respondent contended that it would
take approximately
six weeks to move its equipment to another
premises as a contractor with specialised equipment would be
required. This assertion
was denied by the Applicant. Neither party
put up any documentary evidence to support their assertions.
42.
In the circumstances, I find that a reasonable period of notice would
be two
weeks, and order that the Respondent must vacate the premises
by no later than 31 December 2020.
Order
43.
For the reasons set out above, I find that the lease agreement
terminated through
the effluxion of time on 31 October 2020, and that
the Respondent’s continued occupation of the premises is
unlawful.
44.
The following order is made:
44.1.
the forms and service provided for in the Rules of this Court are
dispensed with and the application is
to be disposed of as one of
urgency in terms of Rule 6(12)(a);
44.2.
the Respondent is directed to vacate the premises at Gym, Building 2,
17 Bradford Road, Bedfordview, 2000,
and to deliver up the premises
to the Applicant in the same good order and condition as that in
which it received it, fair wear
and tear expected, and return all
keys to the premises and duplicates thereof by no later than 31
December 2020; and
44.3.
the Respondent is directed to pay the costs of this Application.
KS MCLEAN, AJ
ACTING
JUDGE OF THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION JOHANNESBURG
Date Argued: 9 December
2020
Date of Judgment: 14
December 2020
For the Applicants: Adv N
Stein
Attorneys: Tatham Wilkes
Inc
For the Respondent: Adv
EJ Ferreira
Attorneys: Texeira Du
Toit Attorneys