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2021
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[2021] ZAGPJHC 520
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Remicor Consulting (Pty) Ltd v Triviron Project Management (Pty) Ltd (6490/2017) [2021] ZAGPJHC 520 (7 April 2021)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO:
6490/2017
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED:
FINAL
Date:
7 April 2021
In
the matter between:
REMICOR
CONSULTING (PTY) LTD
Plaintiff/Excipient
and
TRIVIRON
PROJECT MANAGEMENT (PTY) LTD
Defendant/Respondent
JUDGMENT
TURNER
AJ:
[1]
This is an exception taken by the plaintiff to the defendant’s
amended
plea. The notice of exception records ten grounds of
complaint. The plaintiff abandoned the third and fifth complaints
before the
hearing and, during the course of argument, the plaintiff
also abandoned the first, second, seventh and ninth complaints
(together
the “abandoned complaints”). This leaves only
the fourth, sixth, eighth and tenth complaints to be decided (“the
remaining complaints”). It is not necessary for me to deal with
the abandoned complaints, save in respect of my decision
on costs.
[2]
In the particulars of claim, the plaintiff pleads facts in relation
to
three alleged agreements, which I summarise as follows:
2.1
In September 2014, the plaintiff, defendant and Romh Consulting
concluded the
first agreement
, an oral pre-bid joint venture
agreement in terms of which the three entities agreed
inter alia
to pursue together, business opportunities available through various
tenders. They agreed that if they were awarded a contract
in respect
of any completed tender, they would conclude a further joint venture
agreement.
2.2
In August 2015, the Ekurhuleni Metropolitan Municipality (“EMM”)
awarded Contract
No. PS-EMPO08/2015 pertaining to the provision of
overall project management services for the municipality, which award
was subject
to a service level agreement being concluded with EMM.
The plaintiff alleges that Romh Consulting was a specialist
structural and
civil engineering consultant (not a project management
consultant) and was consequently excluded from the services to be
provided
under the awarded contract. The
second agreement
between
the plaintiff and the defendant was an agreement that they would
conclude an oral joint venture agreement in respect of
PS-EMPO08/2015
.
2.3
In paragraph 10, the plaintiff pleads the
third agreement
, an
oral agreement that it alleges was concluded in August 2015 between
the plaintiff and defendant to the effect that the plaintiff
and the
defendant would act in joint venture in discharging all the service
provider obligations arising out of contract No. PS-EMPO08/2015.
The
pleaded terms of that agreement identify the obligations to be
discharged by the plaintiff and the defendant respectively and,
of
particular relevance for the current exception:
“
11.10
Insofar as further professional Built Environment Services were
to be
required by the EMM … the joint venture would procure such
services from third party specialist Built Environment
Professional
Practitioners.
11.11
The income earned out of contract No. PS-EMPO08/2015 would
be shared
between the plaintiff and the defendant in the ratio of 50/50
(hereinafter ‘the income sharing ratio’).
11.12
Such income sharing ratio was to be computed after any external,
or
third party, expenses (hereinafter ‘Third Party Expenses’)
had been accounted for, and deducted from the income
earned …
11.14
The defendant was responsible for the preparation, and issuing
of
accounting records … as well as to make payments to the
plaintiff, in accordance with the income sharing ratio.”
[3]
In its plea, the defendant denies the tripartite
first agreement
and also denies the
second agreement
, rejecting it as an
“agreement to agree”. In paragraphs 6-8 of the plea,
addressing the
third agreement
, the defendant admits that a
joint venture agreement was concluded between the parties but alleges
that this agreement was entered
into during September 2014. In
pleading the terms of the agreement it alleges, the defendant
confirms a number of the terms pleaded
by the plaintiff including the
obligation on the defendant to maintain all accounting records,
prepare and submit close-out reports
and to receive and make
payments.
[4]
The apparent crux of the dispute between the parties on the pleaded
case
related to the joint venture agreement lies
first,
in the
defendant’s pleading in 8.2 and 8.3 where it pleads:
“
8.2
The nature of the services to be rendered would be Project Management
Services (hereinafter referred to as ‘PMS’);
8.3 The
plaintiff and the defendant would jointly and equally execute all of
the PMS opportunities sourced”.
and
second
, in paragraph 12 where the defendant asserts that the
EMM appointment under contract No. PS-EMPO08/2015 was limited to PMS
work
and identifies the projects categorised the PMS work as being
limited to three of the seven projects alleged by the plaintiff,
those identified in paragraphs 15.1 – 15.3.
[5]
Reading the pleadings as a whole, it appears that the defendant’s
case is that the remaining four projects identified by the plaintiff
in paragraphs 15.4 – 15.7 of the particulars of claim
were not
PMS projects. It asserts that although these were appointments made
under PS-EMPO08/2015, they were not for PMS services
but civil or
engineering services, and therefore fell outside of the scope of the
joint venture.
[6]
The essence of the dispute appears from the pleadings to be: the
scope
of the joint venture agreement between them; which appointments
by EMM under PS-EMPO08/2015 fell within the joint venture agreement;
the amount payable by the defendant to the plaintiff from the
proceeds received in terms of the joint venture agreement.
Relevant Law
[7]
The remaining complaints all assert that the plea is vague and
embarrassing
as a result of the defendant making “bald”
denials and failing to provide particularity which the plaintiff
alleges
the defendant is obliged to provide. The following summary
from Erasmus Superior Court Practice p D1-299 (read with the
cases
cited in the footnotes) usefully captures the test applicable
in the current situation:
:The test applicable in
deciding exceptions based on vagueness and embarrassment arising out
of lack of particularity can be summed
up as follows:
(a)
In each case the court is obliged first of all to
consider whether the pleading does lack particularity to an extent
amounting to
vagueness. If a statement is vague it is either
meaningless or capable of more than one meaning.
To
put it at its simplest:
the reader must
be unable to distil from the statement a clear, single meaning
.
(b)
If there is vagueness in this sense the court is
then obliged to undertake a
quantitative
analysis of such embarrassment
as the
excipient can show is caused to him by the vagueness complained of.
(c)
In each case an
ad
hoc
ruling must be made as to whether
the
embarrassment is so serious as to
cause prejudice
to the excipient if he
is compelled to plead to the pleading in the form to which he
objects. A point may be of the utmost importance
in one case, and the
omission thereof may give rise to vagueness and embarrassment, but
the same point may in another case be only
a minor detail.
(d)
The ultimate test as to whether or not the
exception should be upheld is whether the excipient is prejudiced.
(e)
The onus is on the excipient to show both
vagueness amounting to embarrassment and embarrassment amounting to
prejudice.
(f)
The excipient must make out his case for
embarrassment by reference to the pleadings alone.
(g)
The court would not decide by way of exception the
validity of an agreement relied upon or whether a purported contract
may be void
for vagueness.
(emphasis
added)
[8]
In undertaking a quantitative analysis of the embarrassment suffered
by
the plaintiff as a result of the vagueness in the plea, one must
consider the plea as a whole to understand what the defendant does
say as well as what it does not say. To my mind, the key elements in
the defendant’s plea are the admitted joint venture
agreement,
the fact that the joint venture was implemented in respect of the
identified EMM contract, the defendant’s admitted
obligations
under that joint venture agreement and the fact that it is the
defendant (not the plaintiff) that seeks to draw a distinction
between PMS services and other services rendered to EMM in order to
justify why the full amounts received are not to be split 50/50
with
the plaintiff.
[9]
Where the defendant has admitted a joint venture arrangement linked
to
contract PS-EMPO08-15 but then sought to distinguish instructions
given for PMS work from those given for architectural and civil
engineering services by EMM under that same contract number, I
consider that the defendant has an obligation to plead sufficient
particularity in relation to the distinction which it draws to enable
the plaintiff to understand the case it has to meet and to
prepare
for trial. Where the defendant fails to do so, prejudicial
embarrassment is caused to the plaintiff.
[10]
I set out the detail of each of the remaining complaints below. As
all of the remaining
complaints are raised on a similar basis, my
decision follows after dealing with all of them.
Fourth complaint
[11]
In paragraph 14 of the particulars of claim, the plaintiff alleges
that the value of the
projects sourced under contract No.
PS-EMPO08/2015 during the period August 2015 to 22 June 2017 was
R26,049,937.12 and it alleges
that these projects were executed by
the parties. It goes on to plead that the defendant had received
payment of R20,583,808.67.
[12]
In its plea, the defendant denies these allegations. In paragraph 12
of the plea (responding
to paragraph 15 of the particulars of claim),
the defendant records that the project sourced under the PMS work
were limited to
three of the seven projects listed by the plaintiff,
namely Germiston, Duduza and KwaThema. It does not however provide
any details
of the value of those three projects or the amounts
received in respect of those three projects.
[13]
The plaintiff’s complaint is that the defendant is obliged to
plead its version of
the value of the projects received in terms of
the joint venture agreement and the amounts paid. It bolsters its
complaint with
reference to the terms of the joint venture agreement
pleaded by the defendant itself
inter alia
that it was the
defendant’s obligation to prepare and submit progress reports,
maintain accounting records and effect payments
on behalf of the
joint venture.
[14]
Mr Tshabalala
, who appeared for the defendant, argued that the
defendant was not obliged to plead its version. He argues that the
defendant is
entitled, in terms of Rule 22(2) to deny the whole of
the allegations made by the plaintiff, leaving the plaintiff to prove
the
allegations which the defendant has not admitted.
Sixth complaint
[15]
In paragraphs 16 and 17 of the particulars of claim, the plaintiff
pleads that it complied
with its duties in terms of the joint venture
agreement between August 2015 and 28 February 2017 (described as the
“initial
period”). It goes on in paragraph 18 to assert
that “during the initial period, in relation to work done on
the respective
projects … the defendant invoiced EMM the …
amount of R1,963,2921.27.” It then attaches the invoices relied
on.
[16]
In response to paragraphs 17 and 18 of the particulars of claim, the
defendant denies these
allegations and provides no particularity.
[17]
The defendant argues that it is entitled to deny these allegations
because of its previous
denial that the joint venture agreement
covered civil and engineering work. Further, insofar as the amount
asserted by the plaintiff
relates to both PMS and engineering work,
it says it is entitled to deny that the pleaded amount was invoiced
without providing
particularity of what it asserts the correct
position to be.
Eighth complaint
[18]
In paragraph 21 of the particulars of claim, the plaintiff pleads
what it alleges to be
the net income earned by the joint venture
during the initial period, after deduction of third party expenses –
R18,226,617.27.
The defendant baldly denies this allegation for
similar reasons given above.
[19]
Despite having admitted that it is party to the joint venture and
that it was the party
responsible for payments made and received, and
the party responsible for maintaining the accounting records of the
joint venture,
the defendant argues that it is not required to
provide any particularity of what it says was earned and spent.
Tenth complaint
[20]
At paragraph 26, the plaintiff makes a general allegation that it
performed its duties
in terms of the joint venture agreement and then
it sets out the balance on the amount due to it, which it asserts
remains outstanding.
The defendant has pleaded a blanket denial to
all the allegations in paragraph 26.
[21]
As with previous objections, the defendant argues that it is entitled
to baldly deny these
allegations, place them in issue and to require
that the plaintiff prove them. The manner in which it formulates this
argument
at paragraph 58 of the defendant’s heads of argument,
using a double negative to avoid making a positive assertion, is
instructive:
“
[Defendant]
denies that it has not remunerated the plaintiff in respect of what
it was obliged to in terms of the joint venture
agreement. It is thus
incumbent on the plaintiff to prove its entitlement to the monies it
alleges it was entitled to in terms
of the agreement and that the
defendant is refusing to make payment thereof.”
[22]
As appears from the defendant’s argument, the issue in dispute
is the extent to which
the defendant was obliged, in terms of the
joint venture agreement, to remunerate the plaintiff.
Decision
on Complaints
[23]
In my view, where the defendant is the party that was operating the
joint venture, receiving
the instructions and payments and allocating
those payments, it is obliged to provide the particularity as to: (i)
the orders and
invoices which it contends relate to PMS work; (ii)
the amounts which it alleges were payable to the respondent in terms
of the
joint venture agreement; (iii) the amounts actually paid to
the plaintiff. This is necessary for the plea to communicate a
single,
clear meaning to the reader.
[24]
In the circumstances, I find that the plea is impermissibly vague and
the lack of particularity
leaves the reader unable to distil a clear,
single meaning (
Venter and Others NNO v Barrit
2008 (4) SA 639
(C) at 644 B). The extent of the vagueness and the embarrassment
caused thereby gives rise to actionable prejudice where the plaintiff
(and the court) is unable to identify, from the pleading, the case
which the defendant intends to present at trial. Further, given
the
limitations on a party’s ability to request particulars in
relation to a denial, it is unlikely that the plaintiff would
be able
to obtain such particulars in a request made in terms of rule 21.
[25]
In the circumstances, I find that the fourth, sixth, eighth and tenth
complaints are justified
and the exceptions based on these complaints
are well taken.
Costs
[26]
The plaintiff having abandoned six of its ten grounds of complaint
does have an impact
on the costs to be awarded. In my view, even
though the plaintiff has been successful on the four remaining
complaints, there would
have been wasted costs incurred in the
preparation of notices, heads of argument and for the hearing
relating to the remaining
complaints. In my discretion, I consider
that the defendant should pay only 50% of the plaintiff’s costs
associated with
the exception.
[27]
In the circumstances, I make the following order:
(1)
The plaintiff’s exceptions set out in the fourth, sixth, eighth
and tenth complaints
are upheld.
(2)
The defendant is ordered to amend its plea to provide the necessary
particularity in answer
to the plaintiff’s allegations in
paragraphs 14, 17, 18, 21, 22, 23, 24 and 26 of the particulars of
claim, within 20 days
of this order.
(3)
Should the defendant fail to make the required amendments, the
plaintiff is entitled to
return on the same papers to have the
defendant’s defence struck out.
(4)
The defendant is liable to pay 50% of the plaintiff’s costs of
the exception, on the
scale as between party and party.
DA
Turner AJ
ACTING
JUDGE OF THE HIGH COURT
GAUTENG
LOCAL DIVISION, JOHANNESBURG
Date
of hearing: 9 March 2021
Date
of judgment: 7 April 2021
Appearances:
On
behalf of the applicant Adv A Glendinning
Instructed
by: Shoba Attorneys
On
behalf of the defendant Adv Tshabalala
Instructed
by: Thejane Attorneys