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[2011] ZAECPEHC 62
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Letap CC v Oceans 11 Seafoods Take Outs and Another (3563/11) [2011] ZAECPEHC 62 (2 December 2011)
9
REPORTABLE
IN THE HIGH COURT OF
SOUTH AFRICA
EASTERN CAPE –
PORT ELIZABETH
Case No: 3563/11
Date Heard: 29/11/11
Date Delivered:
2/12/2011
In the matter between
LETAP CC
…............................................................................
Applicant
and
OCEANS 11 SEAFOODS
TAKE OUT CC
….......................
First
Respondent
TRANSNET LIMITED
….............................................
Second
Respondent
JUDGMENT
REVELAS J
[1] The applicant
approached this court in urgent proceedings seeking the eviction of
the first respondent from premises which the
applicant has been
leasing since 2001, from its owner, the second respondent by 30
November 2011. Notwithstanding a clause in the
lease agreement
concluded between the applicant and the second respondent prohibiting
sub-letting, the applicant nonetheless sub-let
the premises to the
first respondent. The second respondent did not oppose the
application, whereas the first respondent not only
opposed the
application, but launched a counter application seeking to prohibit
the applicant from proceeding with the building
operations on the
property on which it had commenced in October this year.
[2] Substantial
disputes of facts emerged in the affidavits filed in this matter, but
I will nonetheless attempt to set out accurately,
insofar as
possible, the background facts which are common cause, or not in
dispute which gave rise to these two applications.
[3] The deponent to the
founding affidavit, Imraan Patel (“Patel”) is the
managing member of the applicant, a close
corporation. The applicant
is a lessee of a portion of property (erf 5638) comprising 702 square
metres, within the Port Elizabeth
Harbour. On this land there is a
building described in the second respondent’s lease agreement
with the applicant as “(a)
Mess and Ablution _ _ _ (b) Control
Cabin Building”. The latter is known as “Oceans 11”,
a very popular seafood
restaurant (“the premises”). The
current lease, entered into on 1 April 2011 between the applicant,
and the second
respondent, is a renewal of two prior leases, each for
a duration period of three years. The current lease comes to an end
on 31
March 2014.
[4] During about 2002,
Patel came to what Patel terms “an arrangement” with
Mohamed Rashid Hassim (“Hassim”),
his wife’s uncle,
to the effect that the latter and his family could occupy the
premises for his own use, paying the rental
and deposits and
consumption charges in respect thereof. According to Hassim, who is
also the deponent to the answering affidavit,
the first respondent
has been conducting its business on the premises since 2005 from the
premises.
[5] Before that, and
since 2002, two other entities, which were the predecessors of the
first respondent (C-Food Packaging and Catch
22), occupied the
premises. Both businesses belonged to Hassim’s son, Mohamed
Jameel Hassim (“Jameel”). Jameel
is also the sole member
of the first respondent, who currently occupies the premises.
[6] Quite plainly, this
“arrangement” as Patel has termed it, was nothing more
than an agreement (albeit unlawful) to
sublet. Hassim denies any
knowledge of a prohibition against sub-letting. However on his own
version, he was given a copy of the
lease in 2002 when he raised the
concerns he had with the cancellation clause (clause 1), and when
Patel gave him the assurance
that the lease would not be cancelled
and that Hassims could do business on the premises for as long as the
lease with the second
respondent endured. One has to assume he had
read the entire contract.
[7] The probabilities
indicate that all parties involved knew that the sub-letting
agreement was prohibited by the main lease between
the applicant and
the first respondent. In WE Cooper’s
The South African Law
of Land and Tenant 6
th
Edition
, at 230,
the consequences of a breach of a prohibition clause against
sub-letting in a lease agreement are discussed. In such circumstances
according to the author, the lessor would be entitled to eject a
sublessee and terminate the agreement with the lessee. Clearly,
the
first respondent has no entitlement in law to occupy the premises.
The lessor (second respondent) has however elected to remain
silent
and has not taken or threatened with any action against the first
respondent. Hassim explained that Mr Pitout of the second
respondent,
had adopted the approach that this was a family matter in which the
second respondent did not want to become embroiled.
Since no
affidavit has been put up to the contrary the veracity of the
aforesaid statement can be accepted. That then puts paid
to the
applicant’s argument that if the first respondent remains on
the premises any longer, after the end of November this
year, the
second respondent would cancel the lease and both the applicant and
the first respondent would face financial ruin. I
will now consider
the applicant’s other contentions pertaining to the urgency of
the relief sought.
[8] The applicant’s
current lease with the second respondent is much on the same terms
and conditions of the previous leases.
The material term in the lease
which is of relevance in the determination of this matter, is clause
31.1, which prohibits sub-letting
without the second respondent’s
consent. Hassim was fully aware that the premises were owned by the
second respondent who
leased it to the applicant. According to him,
the first respondent’s occupation of the premises has been with
the knowledge
and blessing of the second respondent. At the expiry of
every lease, when a new one was entered into by the applicant and the
second
respondent, Hassim would be notified of the new deposit and
rental payable to the second respondent, and Hassim’s daughter
made the necessary payments directly to the second respondent. It can
hardly be argued that the second respondent was unaware of
the
sub-letting arrangement on these facts. The Hassims also had dealings
with Mr Pitout, the second respondent’s area manager
in Port
Elizabeth, regarding renovations to the premises when a fire broke
out in the restaurant. Many employees of the second
respondent are
also regular patrons of the restaurant as its main office building is
very close to the restaurant.
[9] During 2008, the
applicant began to invoice the first respondent directly for rental
and other charges. During this same year
Patel also had building
plans pertaining to renovation and alterations of the premises
approved by the local municipality, but
did not advise the Hassims
thereof.
[10] Some time before
2008 then, Patel must have decided to develop and renovate the
property. It appears from his later conduct
and the plans that Patel
or the applicant also wanted to run a food outlet from the premises
with Patel’s brother. The second
respondent gave its consent to
the refurbishment of the premises in October 2011. An architect and
project manager, Eldridge Sauls
(“Sauls”) was appointed
as the project manager for development of the premises.
[11] On 24 October
2011, the applicant’s attorneys advised the first respondent
that the applicant needed the premises in
order “to further its
business interests”. Relying on the express prohibition of
sub-letting without the second respondent’s
consent in the
lease agreement, it was maintained that the first respondent’s
occupation of the property was in breach of
the applicant’s
lease agreement with the second respondent. The purpose of this
letter was to notify Hassim that the agreement
with the first
respondent “to occupy” the premises, had been terminated
and the first respondent is given until the
end of November (2011) to
vacate the premises. Hassim who had by then realized that Patel
wanted to begin a new business venture
of his own on the premises,
did not want to co-operate and vacate the premises. Acrimony resulted
between the two families. Hassim
alleged that dustbins were emptied
by members of Patel’s family at the premises just to harass the
Hassims.
[12] In support of the
applicant’s contention that the eviction of the first
respondent had become a pressing and urgent matter,
it attached an
affidavit by Sauls to its papers, stating that the completion of the
renovation project is 9 December 2011 (within
ten days of hearing
this application) which is the shutdown date for the building
industry. He stated that the project was running
on an “extremely
tight timetable” and that sub-contractors have been booked in
advance to commence with plumbing and
the installation of
electricity. Patel advised Hassim that he wished to start the
renovations on 10 October 2011. Sauls stated
in his affidavit that
occupation by 1 December 2011 was critical. A large consignment of
fish had also been ordered to be sold
from the new food outlet, which
Patel wanted to run from the premises.
[13] The impression
Hassim gained initially, was that Patel only wanted to upgrade the
premises. Hassim said he did not realize
that the first respondent
would be incorporated or become part of Patel’s new business
venture. Patel had previously given
him a rudimentary sketchplan of
the future upgraded building. Significantly, Patel did not give
Hassim the detailed building plan
which had already been approved by
the municipality in 2008, which looked entirely different from the
skecthplan, and was clearly
a deceptive omission on Patel’s
part.
[14] The fire referred
to earlier, broke out on the premises in April 2011, around the time
when the applicant renewed the lease
with the second respondent. The
first respondent had taken out insurance and the insurance company
paid out R250 000.00. The
building had to be refurbished and
this took about six to eight weeks to complete. Patel never let on
that he planned his own extensive
renovations. The first respondent
was even required by the applicant to pay the applicant the deposit
and rentals, owing in respect
of the new lease with the second
respondent.
[15] Patel knew as
early as 2008 that the proposed development he had in mind, which
would further the applicant’s business
interests, had been
approved and his deliberate silence on this important aspect until
October 2011 compounds his deception. The
applicant’s reliance
on the breach of the lease contract it had concluded with the second
respondent, is disingenuous. Further,
to wait until the eleventh hour
to bring this urgent application suggests that the urgency to eject
the first respondent, seems
to be part of the applicant’s
business strategy with regard to the new restaurant rather than
events out of the applicant’s
or Patel’s control.
[16] The reason for
Patel’s failure to inform Hassim of his business plans much
sooner than he did, can only be because it
was economically
advantageous to the applicant. It did not seem to matter to Patel
that his late disclosure of the position was
highly prejudicial to
the first respondent who now had to endure closure of its business
before the lucrative holiday season.
[17] The fact that a
litigant with a claim sounding in money might suffer serious
financial consequences by having to wait his turn
for the hearing of
his claim, does not entitle him to preferential treatment on the
roll. (See:
IL & B Marcow Caterers v Greatermans South Africa
1981(4) SA 108 [WLD at 113G-H]). Even if an application is
regarded as urgent in terms of Rule 6(12) of the Uniform Rules of
Court
on its merits, a court may still refuse to dispense with the
ordinary prescripts of Rule 6 regarding time limits, where the matter
has become urgent due to circumstances which is of an applicant’s
own making. (
Schweizer Reneke Vleis mpy (Edms) Bpk v Die Minister
van Landbou en Andere
1972(1) SA 235 (T)).
[18] In my view, the
applicant’s self-created urgency should not determine this
matter. The applicant’s decision to
engage the service of
sub-contracts or to perform building work in the timeslot of ten days
after arguing this urgent application
and its order of large
quantities of fish on the basis that it would successfully obtain an
eviction order against the first respondent
on an urgent basis, was
an ill-considered one.
[19] In the light of
the aforegoing I naturally considered striking the application from
the roll. That would have had the result
that the applicant would
have to bring the application in the normal course. The first
respondent would then still, even at that
later stage, be unable to
show any entitlement to remain on the premises, and will probably be
ordered to vacate the premises in
any event. A preferable route to
follow, would be to order the first respondent to vacate the premises
in question at a later date
than dictated by the applicant, and to
prohibit the members of the applicant from interfering with the first
respondent access
to the premises or to continue with its building
operations until the applicant has properly vacated the premises.
[20] In the early case
of
Graaff-Reinet Municipality v Mkwane,
1950(3) SA 883 EDLD,
the court considered an appeal from the magistrate’s court
against a decision of a magistrate in a matter
where the appellant
municipality sought an order for ejectment of the respondent from a
housing scheme on the ground of non-payment
of rent. The respondent
had become unfit for work and was engaged in an endeavour to obtain a
pension.
[21] The magistrate
granted the ejection sought, but stayed the execution of the warrant
“
until the defendant can be provided with other cheaper
accommodation
”. On appeal the court held that “
however
good
and right
” the action of the appellant was in
establishing the housing scheme which caused the respondent to lose
his cheaper accommodation,
the magistrate did not exercise his wide
discretion so unreasonably as to warrant interference. The court held
as follows at 896
H-I:
“
In
deciding this question we must look at the equities both for and
against the lessor as well as the lessee, but should remember
that
this is a Regulation for the protection of the lessee. In De Wet and
De Wet v Juter
(1944 C.P.D. 255
at page 257) it was stated:
“
that
one must look at the position occupied by the lessee under the lease,
and the position in which he will be placed in if he
were to be
ejected from the leased property etc”
.
[22] The aforesaid
reasoning can be applied to the facts of the present matter. It
stands to reason that a court has an inherent
discretion to postpone
the effect of an interdict, if it brings undue hardship for one of
the parties. Given the position of the
first respondent, if it were
to be ejected on such short notice, after running a profitable
business for so many years from the
premises, it would be appropriate
to exercise my discretion to afford the first respondent more time to
vacate the premises. The
building operations at the premises would
presumably not commence properly before the middle of January next
year. Accordingly,
it would be fair and practical in the
circumstances to give the first respondent until the end of January
2012 to vacate the premises.
Costs
[23] Even though the
applicant was partially successful in obtaining the relief it sought,
it should not be entitled to its costs
since the matter was also not
urgent. The first respondent argued that a punitive costs order ought
to be made against the applicant.
Although the manner in which the
applicant has conducted itself calls some for censure, it should also
not be overlooked that the
first respondent was also only nominally,
or partially successful in resisting the application and pursuing its
counter-application.
An ordinary costs order against the applicant
would be sufficient.
[24] Accordingly, I
make the following order:
The first respondent
is to vacate the premises measuring 702 square metres on ERF 5638
Port Elizabeth Central, within the Port
Elizabeth harbour, also
known as “Oceans 11” by no later than 17h00 on 31
January 2012;
Until such time as the
first respondent has vacated the premises, the first respondent is
to enjoy undisturbed possession and
unfettered access to and from
the aforesaid premises.
The applicant is to
pay the costs of this application on a scale as between party and
party.
________________
E REVELAS
Judge of the High Court
Counsel for the
Applicant: Adv van Rooyen
Port Elizabeth
Instructed by: Friedman
Scheckter
75 – 2
nd
Avenue
Newton Park
Port Elizabeth
Counsel for the First
Respondent: Adv JGW Basson
Pretoria
Instructed by: Vezi de
Beer Inc Attorneys
Faerie Glen
Pretoria
c/o Fredericks
Incorporated
109 Westview Drive
Mill Park
Port Elizabeth
Date Heard: 29 November
2011
Date Delivered: 02
December 2011