About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Eastern Cape High Court, Port Elizabeth
SAFLII
>>
Databases
>>
South Africa: Eastern Cape High Court, Port Elizabeth
>>
2010
>>
[2010] ZAECPEHC 54
|
|
Vuka Uzenzele Plant Hire & Civils CC v Ho Hup Corporations (SA) (Pty) Ltd and Others (2326/2010) [2010] ZAECPEHC 54 (25 August 2010)
IN THE HIGH COURT OF SOUTH AFRICA
(EASTERN CAPE – PORT ELIZABETH)
Case
No.:
2326/2010
Date
heard: 18 August 2010
Date
delivered:
25 August 2010
In the matter between:
VUKA-UZENZELE
PLANT HIRE & CIVILS CC
Applicant
and
HO HUP CORPORATIONS (SA) (PTY)
LTD
First
Respondent
MULTI PROJECTS
Second
Respondent
FRANCOIS
THERON
Third
Respondent
J U D G M E N T
DAMBUZA, J
:
In this
application, the applicant seeks an order that possession of a
certain construction site
s
referred to as Joe Modise Peace Village, Kwanobuhle, Uitenhage and
the Thusong Community Centre, Motherwell, Port Elizabeth,
be
restored to it, and that the respondents be interdicted from
interfering with its exercise of its rights of lien over the
properties.
The applicant is a
close corporation incorporated and registered in accordance with the
Close Corporation Act, Act No. 69 of 1984
,
with its principal place of business at Farm Langford, Somerset
East.
The first respondent is a company
registered with Limited Liability in terms of the Companies Act, Act
61 of 1973. The second
respondent is referred to in the application
as “business contractors” with a principal place of
business at 5 Lilac
Street, Sunridge, Port Elizabeth. The legal
status of the second respondent is not apparent from the papers.
The third respondent
is an adult male who is in charge of the
second respondent.
Only the first respondent opposes the
application.
The background to
this application, is that the first respondent was appointed by the
Nelson Mandela Metropolitan Municipality
(“the Municipality”)
as the main contractor in a contract relating to construction of
“low cost” houses
in the Joe Modise Peace Village,
Kwanobuhle, Uitenhage and the Thusong Community Centre, Motherwell,
Port Elizabeth (the sites).
Pursuant to the agreement between the
Municipality and the first respondent, the first respondent
concluded an oral agreement
with the applicant in terms of which the
applicant was appointed by the first respondent as a subcontractor,
to construct civil
works (including sewer lines, water reticulation
and roads) at the aforesaid sites. In terms of the agreement
concluded between
the applicant and the first respondent, the
applicant would execute the works in accordance with the
specifications and bills
of quantities that formed part of the main
agreement between the first respondent and the municipality. The
applicant would
then invoice the first respondent for the work done.
The first respondent would include the applicant’s invoices
in its
(the first respondent’s) invoices to the municipality,
procure a “certificate” as stipulated in the main
agreement
and seek payment from the municipality. On receipt of
payment from the municipality, the first respondent would then pay
the
applicant in terms of the invoices issued by the applicant.
The dispute in
these proceedings
has
its roots in the payments made, or not made by the first respondent
in respect of the applicant’s invoices.
The applicant contends that the first
respondent has failed to pay to it an amount R1,905,371.55 due in
respect of invoices submitted
by it to the first respondent although
the first respondent has received payment from the municipality.
As a result of this
failure by the first respondent to make payment,
so contends the applicant, the applicant suspended work at the sites
but has
remained thereon, exercising its right of lien over the
sites. According to the applicant it exercises its right of lien
by
retaining employees on site during the day. At night and for
security reasons, the equipment and material belonging to the
applicant is moved to the Uitenhage site office.
Whilst Almero Pienaar, on the one
hand, denies in the answering affidavit, that the first respondent
owes the applicant some moneys
or moneys are due to the applicant
for work done by the applicant on the sites, he, on the other hand
states that one of the
applicant’s invoices (Annexure “F”
to the founding papers) was only received by the first respondent on
29
July 2010 and that a certificate in respect thereof is yet to be
issued by the municipality and the money paid to the first
respondent.
He also states that another certificate for R469,000.00
has been verified and issued by the municipality and the first
respondent
awaits the payment of the money. I am therefore
persuaded that a portion of the applicants fees for the work done
remained unpaid
when the second and third respondents started
working on the sites; whether that was as a result of the first
respondent itself
not yet having been paid by the Municipality or
not, is, in my view irrelevant for the purposes of this application.
It is common cause that on 6 August
2010, the applicant wrote to the first respondent’s attorneys
demanding payment of the
amount alleged to be owing and advising
that it was suspending works as a result of first respondent’s
failure to pay the
amount concerned. On 10 August 2010, the first
respondent appointed the second and third respondents to continue
with the works
that the applicant had been performing at the sites.
The second and third respondents then started working on the
incomplete
works left by the applicant. The applicant viewed the
appointment of the second and third respondents as repudiation by
the
respondent, of the agreement between itself and the first
respondent and cancelled the agreement. The applicant contends that
the appointment of the second and third respondents as contractors
in its place constitutes spoliation as it was in undisturbed
possession of the sites, exercising its right of lien when the
second and third respondents took occupation. I may add that
while
Almero Pienaar, the first respondent’s financial advisor,
denies, in the answering affidavit, that the second and
third
respondent are currently working on the sites and thereby
interfering with the applicant’s exercise or the lien,
Theunis
Crous, who has also deposed to an answering affidavit on behalf of
the first respondent, states that work continues at
the sites and
that restoration of the sites to the applicant is undesirable as it
would result in cessation of the works and
a delay in the completion
of the housing development.
T
he
first respondent denies that the applicant is exercising a lien over
the sites and contends that on 6 August 2010, after suspending
work
at the sites, the applicant abandoned the sites and the first
respondent had to seek services of another contractor, that
being
the second and/or third respondent. It further denies that any
moneys are owing to the applicant for work done by the
applicant on
sites.
The first
respondent raises, a number of issues with the application.
Firstly it takes issue with service of the application
on
it at the Uitenhage site office. Pienaar refers to an email sent by
the first respondent’s attorneys to the applicant’s
attorneys on the day before the application was launched, in which
the first respondent’s attorneys indicated that the
first
respondent’s registered address is 109 Westview Drive, Mill
Park, Port Elizabeth. The first respondent contends
that service of
the application at the Uitenhage site was an irregular step which
falls to be set aside.
That
the applicant’s attorneys were advised that the first
respondent’s registered address is 109 Westview Drive, Mill
Park, Port Elizabeth is apparent from the copy of the email which is
part of the papers. The applicant contends, however that
no
domicilium
citandi et executandi
was chosen in the oral agreement and that in other matters in which
the parties are involved, the first respondent’s address
has
often changed to the extent that the applicant is not certain as to
what the correct registered address is. My view is that
although
the first respondent’s registered office was given as the Port
Elizabeth address, Rule 4(1)(a)(v) of the Rules
of this Court
provides that, in the case of a corporation or a company, service of
process shall be effected by the Sheriff by
delivering a copy to a
responsible employee thereof at its
registered
office
or
its
principal place of business
within the Court’s jurisdiction. The Rule is permissive and
does not purport to make service at the registered office
obligatory, to the exclusion of service at the principal place of
business within the jurisdiction.
1
Service at the principal place of business within the jurisdiction
is good service; the two places are offered as alternatives
for
service. It is not the first respondent’s case that the
Uitenhage site is not its principal place of business. In
any
event, there is no evidence that the first respondent suffered
prejudice as a result of service at the Uitenhage office.
I am not
persuaded that service of the application was irregular or so
irregular as to be a nullity.
A further issue
raised by the first respondent is that
the
period of time within which the first respondent had to answer to
the applicant’s case was extremely short and that
it was
prejudiced in the preparation of its case in answer to the
applicant’s claims. I deal with this issue in conjunction
with the third issue raised by the first respondent, that being a
denial that the application is urgent in nature as contended
by the
applicant.
The first respondent contends that
the applicant abandoned the sites on 5 August 2010, yet it waited
until 12 August 2010 to launch
the application. The reason for
this delay, so it was submitted on behalf of the first respondent,
is not set out in the applicant’s
papers.
Assuming that the
applicant does have a right of lien over the sites and that it has
been dispossessed of such a right, there
is, in my view, merit in
the argument that the matter is inherently urgent because such
dispossession renders the exercise of
lien impossible. If a proper
case has been made out for a spoliation order then a case of
emergency exists. A spoliation order
is intended to meet a case of
emergency.
2
The application was launched on
11 August 2010. The notice
of motion provides that the application would be heard on Thursday,
12 August 2010 at 14h00, thus
giving the first respondent less than
a day within which to prepare to appear in Court in response
thereto. Christoffel Johannes
Lombard, the sole member of the
applicant, states in the founding affidavit that the application is
by its nature inherently
urgent in that, should the applicant fail
to take the urgent steps, it shall lose its right of lien over the
property. Lombard
states further that the second and third
respondents are currently on site, continuing work on the work done
by the applicant
and as such interfering with the applicant’s
security on an ongoing basis and changing the work done, which has
not yet
been fully valued and cannot be valued once further work is
done.
T
he
second and/or third respondent arrived at the site on 10 August
2010. On the same day the applicant’s attorneys wrote
to the
first respondent’s attorneys demanding payment and advising
that the applicant was cancelling the agreement between
the parties
(first respondent and the applicant), pursuant to what it viewed as
repudiation hereof by the first respondent.
The applicant also
warned of its intention to institute Court proceedings for what it
viewed as interference with its right
of lien. The application was
instituted the day thereafter, on 11 August 2010. Given that the
second and third respondents
were only appointed on 10 August 2010
and, presumably, only started work on the sites thereafter, the
applicant could not have
instituted proceedings prior thereto. I
can therefore find no basis for a conclusion that applicant delayed
in not launching
the application prior to
11 August 2010.
A fourth issue
raised by the first respondent is that
,
whilst the applicant seeks a rule
nisi
together with interim relief pending a return date, the relief
sought is in effect final in nature and not an interim interdict.
This is therefore, so contends the first respondent, a clear attempt
by the applicant to escape the more onerous requirements
stipulated
for granting of a final interdict. It is also the first
respondent’s case that the applicant has failed to
satisfy the
requirements for the order it seeks.
It
has indeed been held that the
mandament
van spolie
bears
some resemblance to a final interdict and that although the
mandament
has sometimes been equated with an interdict, there are differences
between the two remedies.
3
To obtain a spoliation order, the applicant must satisfy the
Court that on the admitted or undisputed facts, it was in peaceful
and undisturbed possession of the property of which it was despoiled
and that the respondents deprived it of the possession.
Mr Spruyt
who
appeared on behalf of the applicant submitted, correctly in my view,
that I need not enquire into whether the applicant is
or was at the
time of dispossession, entitled to a right of lien over the sites.
In possessory proceedings for protection of
a right, the question
whether or not the applicant has the right is irrelevant; what is
relevant and has to be proved, is that
the applicant
exercised
the
right and not that he
owned
the right.
4
In this case
therefore the relevant inquiry is whether,
on
10 August 2010 when the first respondent appointed the second and
third respondent to do the work that the applicant had been
doing on
the sites and when the second and third respondents started working
at the sites, the applicant was exercising a right
of lien over
sites. Consequently, the contention by the first respondent that
the applicant did not have a right of lien over
the properties
because such a right does not exist over state property and is, in
any event, not available to sub-contractors,
does not assist the
first respondent.
Even if I had
to consider these arguments by the first respondent I was not
referred to any authority, and I could not find any,
in support of
the submission that no right of lien exists over state property.
For the submission that no right of lien accrues
to a subcontractor
as a result of an agreement concluded with the main contractor I was
referred to two decisions of the Supreme
Court of Appeal; in
Buzzard
Electrical v Jan Smuts Avenue Investments
1996
(4) SA 19
and
Wynland
Construction v Ashley-Smith en Andere
1985
(3) 798. A material distinguishing fact between these two cases and
the one at hand is that in the cases referred to the
right of
retention was raised in action proceedings as opposed to application
for spoliation order. Hence the Court inquired
into the validity
thereof (ie whether the subcontractor was the owner of the right).
The decisions relied on do not, in my view,
support the submission
on behalf of the first respondent that generally a sub-contractor,
and in particular, the applicant has
no right of lien over a
property on which it performed work and has a claim for unpaid
moneys against the main contractor.
5
Turning to whether
the applicant was exercising its right of lien and was in possession
of the sites when the second and third
respondents took occupation,
the
general principle is that the right of lien exists only if the lien
holder is in possession of the thing to which his claim
relates for
as long as he retains possession thereof.
6
It has been held that the physical element of possession implies
control
rather than
physical
prehension
.
7
Spoliation takes place if the applicant is deprived by the actions
of the respondent of control over the property in question.
8
The first respondent denies that the applicant was in control of
the sites when the second and third respondents started working
thereon. According to Pienaar the first respondent, through its
security guards, always retained possession and control of the
property and the applicant’s access was therefore at the
instance or with the permission of the first respondent. In
any
event, so contends the first respondent, the applicant has never
been denied access to the sites. In this regard I was
referred to
the matter of
Naidoo
NO and Another V Coega Development Corporation, Case No.: 1394/2008
an
unreported decision of this Division delivered on 27 August 2008 in
which I found that the applicant in an application for
a spoliation
order had not been in possession of the property of which he sought
restoration. However my finding in that case
was based on the
nature of the relationship between the applicant and the respondent
being that of an employer-employee (or
quasi
–employee).
The applicant in
Naidoo’s
case had been employed to provide “construction management
services” to a development on the respondent’s property.
That, in my view is clearly, distinguishable from a case such as
the one at hand, in which the applicant was an (independent)
subcontractor to the first respondent.
The applicant, so
it was submitted on behalf of the first respondent, had stopped
working on the sites on 5 August 2010. It then
released its workers
thereafter. It was improbable, so the argument went, that the
applicant would, every morning move its plant
and equipment from
where it had been kept overnight onto sites in exercise of its lien.
Issue was also taken with the applicant’s failure to specify
the parts of the sites that its claim relates to, given that
the
sites are spread over a very wide area.
It
has
been held that it is not necessary that the possession of the thing
despoiled of be continuous.
9
In the case of immovable property the continuous presence of the
applicant or his or her servants on the premises is not required,
if
the nature of the operations which he or she conducts on the
premises do not require his or her presence.
10
In
Nienaber
v Stuckey
1946
AD the Court held that there was nothing to show that there was any
need for the applicant to be on the land between the
ploughing and
planting; he had never given up physical possession of the land.
Possession need not be of the whole property.
Similarly, the
applicant need not have lost the whole of the property at the hands
of the invader before he or she is entitled
to claim a spoliation
order: a partial deprivation of possession, without deprivation of
the whole of it, is sufficient.
11
The applicant
could clearly not have been in possession of the entire sites. The
evidence is that houses were being built on
some portions of the
sites. But I am satisfied that it was in possession of the portions
where installation of infrastructure
was in progress.
In
an email dated 6 August 2010 addressed by the applicant’s
attorneys to the first respondent, the applicants attorneys
state
that the applicant had suspended all works at the sites and that,
amongst others, it was exercising a lien over the works
at the
Uitenhage and Motherwell (Port Elizabeth) sites as security for
payment of all the first respondent’s obligations
and that if
the respondent’s obligations were not settled by close of
business on 10 August 2010, it would institute proceedings.
The
applicant’s attorneys further remind the first respondent that
“until
such time as the matter is resolved, the lien is exercised to the
exclusion of all others …In particular,
should any attempt be
made to deprive our client of its possession in terms of the lien,
we will approach the High Court as a
matter of urgency”.
It is, in my view
that this correspondence clearly shows the applicant’s
intention of remaining in possession of the sites. It is
improbable,
in my view, that the applicant would thereafter abandon
the site as contended by the first respondent. Apart from merely
stating
that the applicant abandoned the sites, the respondent does
not dispute that the applicant’s machinery and equipment
remains
on the site, whether that is at the site office or anywhere
else on the site. It was, in my view, not necessary for the
applicant
to move the equipment to the particular portions of the
sites where it had been working prior to suspending the works. By
all
accounts, the agreement between the applicant and the first
respondent effectively came to an end on 5 August 2010 when the
applicant
stopped all work at the sites. As it is clearly set out
in the emails from the applicant’s attorneys the applicant’s
intention was to continue maintaining presence on the sites and it
left its machinery and employees thereon for the purpose of
exercising its lien. The dispute of fact as to the applicant’s
possession of the sites can be resolved on the papers.
I am
satisfied that the applicant has proved that it was in possession of
the sites, exercising its lien and that it was despoiled
of its
possession.
Consequently I issue the following
order:
[
27.1] The
respondents are ordered to restore undisturbed possession of the
properties constituting the Joe Modise Peace Village,
Kwanobuhle,
Uitenhage, and the Thusong Community Centre, Motherwell, Port
Elizabeth projects forming the subject matter of the
agreement as
between the applicant and the first respondent to the applicant,
pending the finalisation of an action to be instituted
by the
applicant against the first respondent for payment in the amount of
R1,905,371.55, so to be instituted within 7 days of
the granting of
this Order;
[27.2] Should the applicant fail to
institute the action, the provisions of paragraph 1 above shall lapse
and be of no further
force or effect;
[27.3] The first respondent is ordered
to pay the applicant’s costs as taxed, including the costs in
respect of the standing
down of the matter on 12 and 13 August 2010.
_________________________
N. DAMBUZA
JUDGE OF THE HIGH COURT
Appearances
:
For the applicant: Mr M.P.Q Spruyt
instructed by Friedman Scheckter of Port Elizabeth.
For the 1
st
respondent: Adv A. Beyleveld SC and Adv A.C. Moorhouse instructed by
Fredericks Incorporated of Port Elizabeth.
No appearance for
2
nd
and 3
rd
respondents.
1
Refer to
Erasmus Superior
Court Practice
, at B1-25.
2
Willowvale Estates CC and
Another v Bryanmore Estates Ltd
1990
(3) SA 954
(WLD) 956J.
3
See
Burnham v Neumeyer
1917
TPD 630
at 633.
4
Ninno
Bonino v De Lange
1906 TS 120
5
Sielberberg
and Schoeman’s The Law of Property; 3
rd
edition; at 464-465;
6
Sielberberg
and Schoeman;
Supra;
at
467.
7
Erasmus;
Superior Court Practice; E9-7 in which is cited
Mbuku
v Mdinwa
1982
(1) SA 219
(TkSC) at 221
.
8
Administrator
Cape v Ntshwaqela
1990 (1) SA 705
(A)
9
Bennett
Pringle v Adelaide Municipality
1977 (1) SA 230
(E) at 233
10
Erasmus;
supra,
at
E9-7
11
Erasmus;
supra,
at
E9-7 (also cited therein
Bennett
v Pringle
;
supra;
at
233).