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[2023] ZAFSHC 76
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Roundtop Trading 37 (Pty) Ltd v Itlhatlhose Trading CC and Another (4305/2017) [2023] ZAFSHC 76 (16 March 2023)
IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number:
4305/2017
Reportable:
YES/NO
Of
interest to other Judges: YES/NO
Circulate
to Magistrates:
YES/NO
IN
THE MATTER BETWEEN:
ROUNDTOP
TRADING
37
(PTY) LTD
Plaintiff
and
ITLHATLHOSE
TRADING
CC
First
Defendant
BOLAOMA
RUTH TSESE
Second
Defendant
JUDGMENT
BY
:
MPAMA,
AJ
DATE
HEARD:
01
,
02
&14
NOVEMBER
2022
DELIVERED
ON:
The
judgment was handed down electronically by circulation to the
parties' legal representatives by email and release to SAFLII
on 16
March 2023. The date and time for hand-down
is
deemed to be 16 March 2023 at 15h00.
[1]
The
plaintiff instituted an action against both defendants seeking an
order for the
payment
of
damages
pursuant
to
a
breach
of
contract
contained
in
a
lease
agreement between the plaintiff and the first defendant. The
plaintiff is suing the defendants for the following amounts:
i)
CLAIM
1: for the payment of R266 878.82 for arrear rental and interest
thereon for the period ending August 2017.
ii)
CLAIM
2: for the payment of R34 245.53, an amount quoted by Centlec, a
service provider for electricity for the purposes of reconnecting
electricity after an electric metre box was tampered with.
iii)
CLAIM
3: for the payment of R9 553.90 for rental for the month of September
2017. When the first defendant failed to make payments
in terms of
the lease agreement the plaintiff elected to cancel the agreement and
notified the first defendant of such cancellation.
The amount is for
damages suffered by plaintiff
as
a
result
of early cancellation of the agreement.
[2]
The
defendants defended the action and denied that the plaintiff was
entitled to an order for the payment of arrear rental as the
plaintiff "failed to afford a beneficial occupation of the
property to the first defendant". The defendants further deni
.
ed
that they were responsible for tampering with the metre box and
therefore liable for the payment of R34 245.53, an amount quoted
by
Centlec for tempering with an electric meter box at the leased
property
[3]
The
genesis of this case is that the plaintiff and the first defendant
concluded a lease agreement (agreement) on 29 September 2016
whereby
the plaintiff, agreed to lease Shop no. 1, 26 Bastion Street,
Bloemfontein (the property) to the first defendant from 1
October
2016. The contract was to endure until 30 September 2017.The second
defendant, Ms Tsese stood surety for the first defendant's
obligations towards the plaintiff.
[4]
In
terms of the agreement the first defendant would pay the plaintiff a
monthly rental in the amount of R9 553.90 payable in advance
from 1
October 2016. In the event of non-payment or late payment of rent the
plaintiff would apply interest on the outstanding
amount until it is
fully paid. The first defendant would also be responsible for payment
of municipal charges, including water
and electricity consumed at the
property.
Inter
alia,
the
contract
provided
for
remedies
available
to
each
party
in
the
event
of
non-compliance or breach of any terms of the agreement.
[5]
In
addition the following clauses in the agreement provided:
CLAUSE
2.12
"The
tenant's obligation to pay any and all amounts under clause 2 shall
survive any termination of this agreement."
CLAUSE
3.12
"The
tenant shall not have the right to withhold, set of or reduce any
payment in terms of this agreement by reason of any
claim which the
tenant may have or purport to have against the landlord"
CLAUSE
4.2
"The
landlord does not warrant that the premises are fit for the purpose
which they are let.... There shall be no obligation
on the landlord
to do any work or make any alterations or repairs to the premises to
comply with the requirements of any relevant
authority."
CLAUSE
10.2
"The
tenant shall have no claim of any nature whatsoever whether for
damages, remission of rent or otherwise, against the landlord,
for
any failure or interruption in the amenities and services provided by
the landlord and/or any statutory authority to the premises
and/or
the building, notwithstanding the cause of such failure or
interruption."
CLAUSE
10.3
"The
tenant shall not to be entitled to withhold or defer payment of any
amounts due in terms of this agreement for any reason
whatsoever."
[6]
At
the
commencement
of
the
proceedings
I
was
advised
that
the
following
issues are common cause between parties:
i)
The
parties
entered
into
a
valid
lease
agreement
and
the
terms
of
the
agreement.
ii)
The
second
defendant stood surety for the first defendant's
responsibilities.
iii)
That
electricity was disconnected in the rented premises in December 2016.
iv)
The
amounts
being
claimed
by
the
plaintiff.
[7]
It
was agreed by the parties, that the only issues for determination
during trial are as follows:
Whether
the use and enjoyment of the property was interrupted by the
plaintiff when the electricity was disconnected and if so,
whether
such disruption constitutes a defence to the defendants for non
payment of rent.
Whether
the first defendant tampered with the electric metre box and is
liable for the payment required by Centlec for the damage
made to the
metre box.
[8]
The
evidence of the plaintiff is as follows: Ms Natalie Gouws was
employed as an administrator at Matrix Property Management
tla
CMS
Property Agency. The plaintiff was their client and involved in
leasing out properties. Her company managed some property on
behalf
of the plaintiff.
Her
duties included issuing statements to the tenants and their clients
(landlords), collecting rental payments on behalf of their
clients
and communicating with clients in respect of outstanding payments.
She would also handle all complaints with regard to
the defects in
the leased property
.
[9]
Prior
the agreement at hand the plaintiff and the first defendant entered
into a lease agreement which lasted for five years between
2011 and
2016. The first defendant was running a fish and chips franchise in
the property.
[10]
In
May 2014 there was a problem with an electric meter box. Centlec had
removed the box on allegations of tampering and/or illegal
connections and disconnected electricity. There were some engagements
between her and Ms Tsese who represented the first defendant.
At the
end the plaintiff made a payment of R3 146.40 to Centlec to have
electricity reconnected. The disconnected electricity was
a three
phase power supply and when it was reconnected
by
Centlec
a
single
phase
power
supply
was
installed.
The
result was that
the first defendant was unable to use the stoves to run its fish and
chips business at plaintiff's leased property.
There were further
talks between Ms Tsese and the plaintiff's representative and it was
agreed that the first defendant will use
gas for the stoves. The
first defendant remained at the property running its business using
gas to burn the stoves.
[11]
In
September 2016 the first defendant entered into another agreement
(the one in question) with the plaintiff
.
It
was a year's agreement to end in September 2017. The first defendant
was given consent by the plaintiff to sublet the property
to one Mr
Prince
.
Mr
Prince only occupied the property for few months and vacated it as
electricity was cut
off
from
the premises in December 2016. Ms Tsese visited her offices in
December 2016, made an undertaking that she will go to Centlec
and
sort out the issue of electricity. The first defendant had so far
fallen behind with the payments. As provided in the agreement
they
started charging the first defendant interest on the outstanding
payments.
[12]
During
cross examination it was disputed that Ms Tsese made an undertaking
to go to Centlec in order to have electricity reconnected.
It was
further put to Ms Gouws that due to non-availability of electricity,
the first defendant and Mr Prince were unable to continue
with their
business at the property and the first defendant stopped paying rent
as there was no beneficial occupation of the property.
[13]
This
concluded the case for the plaintiff
.
[14]
Ms
Tsese testified as follows:
The
first defendant was owned by her and her late husband. They bought a
fish and chips franchise. In 2011 the first defendant entered
into a
lease agreement with the plaintiff which endured for five years. From
the onset there were some problems, Centlec came and
disconnected
electricity at the property on allegations of tampering with the
metre box. The plaintiffs representative went to
Centlec and made
payment. Electricity was restored at the property. However, the
electricity that was reconnected
was
a
single
phase
power
whereas
the
one
that
was
disconnected
and was used for the stoves was a three phase power.
After
engagements with the plaintiff the first defendant agreed to use gas
to burn the stoves. This impacted negatively on the first
defendant's
business.
[15]
The
first defendant entered into a new lease agreement in September 2016
effective from the 01 October 2016 and she stood surety
for the first
defendant's obligations towards the plaintiff. As far as she can
recall the contract was for a period of six months.
As a
representative of the first defendant she only signed the agreement
on behalf of Mr Prince who wanted the premises but the
plaintiff had
suggested that because Mr Prince was a foreigner the first defendant
should be the one entering into the contract
on behalf of Mr Prince.
She
also intended to sell the business to Mr Prince.
Electricity
was disconnected by Centlec in December 2016. Mr Prince vacated the
premises due to non-availability of electricity
as he could no longer
run the business. Ms Tsese denied that she made an undertaking to go
to Centlec in order to make arrangements
for reconnection of
electricity. She testified further that the metre box allegedly
tampered with was not at the property rented
by the first defendant,
however in another shop and the first defendant had no access to the
box as it was not in their shop. She
denied that the first defendant
was responsible for tampering with the metre box.
[16]
It
was put to Ms Tsese that she entered into an agreement with the
plaintiff on behalf of the first defendant and not Mr Prince
for a
year and was allowed by the plaintiff to sublet the property to Mr
Prince. She also testified that the first defendant's
business failed
due to non-availability of electricity and as such the first
defendant was justified in not paying the rent.
[17]
Mr
Mbuyiselo May is an employee of Centlec. He has been employed for a
period 14 years occupying different portfolios at Centlec.
His
evidence was that Centlec had quoted the plaintiff an amount of about
R34 000.00 for the installation of a 3 phase power in
the rented
property. This amount was never paid to Centlec. A random inspection
by Centlec in 2014 revealed that a 3 phase power
was illegally
connected at the property. As a result Centlec
removed the
meter box and disconnected electricity at the property.
He
also testified that he is unable to comment on who might have
tampered with the metre box but according to him the person who
stood
to benefit from tampering was the tenant occupying the property. He
was also unable to comment on what could have led to
Centlec removing
the metre box in 2016 and suggested that maybe it was another case of
an illegal connection. This concluded a
case for the defendants.
[18]
The
defendants' defence to non-payment of rent is that the plaintiff is
not entitled to the payments as the plaintiff failed to
provide
electricity in the property. The defendants have taken a position
that due to non-availability of electricity, the first
defendant is
justified in not paying rent. The terms of the lease agreement (in
spite of Ms Tsese's evidence that the agreement
was for 6 months),
the amount owed by the first defendant to the plaintiff and that the
second defendant stood surety for the first
defendant's obligations
towards the plaintiff are not in dispute. To me, the central issue
for consideration is whether the first
defendant's obligation to pay
the plaintiff was reciprocal to the plaintiff's obligations in terms
of the agreement. Were obligations
undertaken by the parties in the
lease contract reciprocal, such that malperformance or
non-performance by the plaintiff entitled
the defendants to raise the
exception
non adimpleti contractus
as
a defence against the claim for the payment in terms of the contract?
[19]
It
is well entrenched in our law that the
exception
finds
its application to contracts to which the principle of reciprocity
applies. The general principles governing the determination
whether
the obligations of parties to a contract are reciprocal
are
set out in the case of
GRAND
MINES
(PTY)
v
GIDDEY
NO
[1998] ZASCA 99
;
1999
(1) SA 960
(SCA) where Smallberger JA at para 11 (delivering judgment
of the majority of the court)
said
the following:
'Where
the common intention of parties to a contract is that there should be
a reciprocal performance of all or certain of their
respective of
their respective obligations the
exceptio
operates
as a defence for a defendant sued on a contract by a plaintiff who
has not performed,
or
tendered to perform,
such
of his obligations as
are
reciprocal to the performance sought from the defendant.
Interdependence of obligations does not necessarily make them
reciprocal.
The mere non-performance of an obligation would not
per
se
permit
of the
exceptio.
It
is only justified where the obligation is reciprocal to the
performance required from the other party. The exception therefore
presupposes the existence of mutual obligations which are intended
to
be performed
reciprocally,
the
one being
intended
exchange
for
the other
"
[20]
In
MAN
TRUCK & BUS
(SA)
(PTY)
LTD
v DORBYL LTD t/a DORBYL
TRANSPORT
PRODUCTS
AND
BUSAF
ALL
SA 113 (SCA) it was held:
"In
contracts which creates rights and obligations on each side, it is
basically a question of interpretation whether the obligations
are so
closely connected that the principle of reciprocity applies: BK
Tooling (Edms) Bpk v Scope Precision Engineering (Edms)
Bpk
1979 (1)
SA 391(A)
at 418B and the authorities there quoted. Where a contract
is bilateral the obligations on the two sides are prima facie
reciprocal
unless the contrary indication clearly appears from a
consideration of the terms of the contract: Rich and Others v
Lagerwey 1974(4)
SA 748 (A) at 761 in fine-762A; Grand Mines (Pty)
Ltd v Giddey NO
[1998] ZASCA 99
;
1999 (1) SA 960
(SCA) at 971 C-D"
[21]
The
determination of whether the obligations of the parties in terms of
the agreement are reciprocal depends on the interpretation
of the
terms of the agreement. My considered view is that the clauses of the
agreement reproduced above clearly show that the performance
of the
first defendant in terms of the agreement was not dependent on the
plaintiff making electricity available at the property.
There is no
express provision relating to reciprocity recorded in the agreement.
[22]
It
is common cause that this was not the first lease agreement entered
into by the parties. History between the parties suggests
that when
electricity was disconnected in 2014, the defendant continued
occupying the property and paid rent despite non-availability
of
electricity. Even when it was restored and the first defendant was
unable to use the stoves, the first defendant had no issue
with that
hence it opted to use gas for its stoves. In spite
of
this
the
first
defendant
went
further
and
concluded
another
agreement with
the plaintiff. This shows that no correlation existed between the
payment of rent and provision of electricity.
[23]
I
am unable to find that the payment of the rental depended on the
plaintiff providing beneficial occupation to the defendant by
providing electricity. The plaintiff had leased the property to the
first defendant who was expected to pay in terms of the agreement
on
occupation of property. There are remedies available to the parties
in the event of breach of the terms of the agreement. Nothing
precluded the first defendant from enforcing its rights in terms of
the agreement if the plaintiff was not adhering to the terms
of the
contract.
[24]
I
am satisfied that the defendant cannot raise the
exception
non adimpleti contractus
as
a defence against the claim for payment in terms of the contract.
[25]
The
second issue to be decided is whether the first respondent should be
liable for the payment of amount quoted by Centlec for
the
reconnection of electricity. The unrebutted evidence of Ms Tsese is
that the metre box in question was not situated at the
property the
first defendant occupied but few shops away from the property. There
is no evidence to show that the first defendant
had any form of
access to the area that had the box allegedly tampered with. In
addition there is no evidence presented by the
plaintiff to show what
had actually happened to this box.
Other
than what happened to the box being referred to as
'tampering'
no
one knows what the actual diagnosis in this box was as no expert
evidence was presented. The plaintiff's contention was that
the only
person who benefitted when the metre box was tampered with was the
first defendant and the court should find that it is
the first
defendant who tampered with the box.
There
is not a shred of evidence against the first defendant to support the
plaintiff's claim other than a suspicion on the part
of the
plaintiff
.
The
first defendant cannot be held liable for the payment of damages in
the metre box.
[26]
The last issue to be decided is the issue of costs (including the
costs occasioned by a postponement
on 10 March 2020). The award of
costs is always at the discretion of the court. The general rule in
litigation is that costs 'follow
the event'. A successful party must
be awarded costs unless the court considers it appropriate to make a
different order. I find
no reasons to deviate from the general rule
.
However
the plaintiff is to pay costs of the postponement on the above date
as it was occasioned by non-compliance with the rules
of the court on
the part of the plaintiff.
[27]
In the result the following order is made:
27.1
The
defendants shall pay the plaintiff an amount R100 944.81 for claim 1
and R 9553.9 for claim 3 together with interest thereon
at a rate of
2% per month a tempore morae plus costs, jointly and severally the
one paying first to absolve another.
27.2
Claim
2 is dismissed.
27.3. The
plaintiff shall bear the costs occasioned by a postponement on 10
March 2020.
L.MPAMA
AJ
On
behalf of the plaintiff:
Adv
.
S
.
Tsangarakis
Instructed
by:
Honey
Attorneys
Bloemfontein
On
behalf of the defendant:
Adv.
P.S.
Mphuloane
Instructed
by:
Gcasamba
Incorporated
Bloemfontein