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[2022] ZAFSHC 174
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University of The Free State v Christo Strydom Nutrition (CSM) In re: University of The Free State v Christo Strydom Nutrition (CSM) (2433/2019) [2022] ZAFSHC 174 (18 July 2022)
IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE PROVINCIAL DIVISION
Case
No.: 2433/2019
Reportable:
YES/NO
Of
interest to other Judges: YES/NO
Circulate
to Magistrates: YES/NO
In
the matter between:
THE
UNIVERSITY OF THE FREE STATE
Excipient
[1]
and
CHRISTO
STRYDOM NUTRITION
(CSN)
Respondent
[2]
In
re
THE
UNIVERSITY OF THE FREE
STATE
Plaintiff
and
CHRISTO
STRYDOM NUTRITION (CSN)
Defendant
Coram:
Opperman,
J
Date
of hearing:
1
3
May 2022
Judgment
Delivered:
18
July 2022
Summary:
Exception
- defense - written agreement/contract –
tacit/implied
terms
JUDGMENT
[1]
The exception that lies before court in terms of Rule 23(1) of the
Uniform Rules of
Court
[3]
revolves around a written agreement.
[4]
The University as the excipient notified on 17 December 2021 that:
“the Defendant’s Plea is vague and/or embarrassing
and/or
lacks averments which are necessary to sustain a defense.”
[5]
In essence; the defense is bad in law. The defense is without legal
merit.
[2]
The first claim of CSN is that the parties cited in the written
agreement are incorrect.
In addition, that there exists a tacit
agreement between the parties that the University was, at the time of
the signing of the
written agreement, suitably accredited to do
scientific tests on the products of CSN to guarantee the quality
thereof. Crucially,
that the results will be recognised not only in
South Africa, but worldwide.
[3]
Conduct “bad in law” and the derision by litigants of the
administration
of justice have become a menace in courts. It erodes
the foundation of the Rule of Law. The veracity; and capacity of the
administration
of justice is the quarry.
[4]
There are two concepts relevant in the instance: “Bad in law”
as understood
in litigation and process and secondly; unbecoming
conduct that emanates from a written agreement or contract.
[5]
A contract or written agreement, as a pledge, suggests honour and
integrity and thus;
law and conduct that is good.
[6]
Litigation may not be abused to evade contractual responsibilities.
The law pertaining
to exceptions have evolved over many decades and
Harms
[6]
has surmised it in
detail with reference to case law:
1.
An exception
is a valuable part of the system of procedure; its principal use is
to raise and obtain a speedy and economical decision
on questions of
law which are apparent on the face of the pleadings.
2.
The leading of
unnecessary evidence is avoided.
3.
An
over-technical approach should be avoided because it destroys the
usefulness of the exception procedure, which is to weed out
cases
without legal merit.
4.
If evidence
can be led which can disclose a cause of action or defense alleged in
a pleading, that particular pleading is not excipiable.
A pleading is
only excipiable on the basis that no possible evidence led on the
pleadings can disclose a cause of action or defense.
5.
Causes of
action or defenses are not in the first instance dependent on
questions of law. They require the application of legal
principle to
a particular factual matrix.
6.
The test on
exception is whether on all possible readings of the facts no cause
of action or defense is made out.
7.
It is for
the excipient to satisfy the Court
that the conclusion
of law for which the plaintiff or defendant contends cannot be
supported upon every interpretation that can
be put upon the facts.
8.
Unless an
exception is taken for the purpose of raising a substantive question
of law, which may have the effect of settling the
dispute between the
parties, an excipient should make out a very clear case in order to
succeed.
9.
Exceptions are
generally not the appropriate procedure to settle questions of
interpretation.
10.
The same
applies to the pleading of implied (strictly tacit) terms; the test
on exception is whether the trial court could (not
“should”)
reasonably imply the term alleged.
11.
The object of
an exception is not to embarrass one’s opponent but to settle
the case (or part of it) in an inexpensive and
easy fashion or
to protect oneself against an embarrassment that is so serious that
it merits the costs of an exception.
12.
The court
should not look too critically at a pleading.
13.
Unless the
excipient can satisfy the court that there is a real point of law or
a real embarrassment, the exception should be dismissed.
14.
An exception
is not permissible against part of a pleading unless that part
consists of a self-contained cause of action or defense.
The
case must be adjudicated as a whole
.
15.
When courts
consider exceptions, no additional facts may be adduced by either
party and the court must assume that the facts alleged
in the
relevant pleading are correct.
16.
The
excipient
must persuade the court
that upon every reasonable interpretation of the averments, no cause
of action or defense is established thereby.
17.
A pleading is
not vague and embarrassing simply because the other party cannot
prepare for trial. Whether a pleading is vague, is
a question of
degree.
18.
The ability to
plead a general denial does not mean that the pleading is not
embarrassingly vague.
19.
The rule
cannot be used to attack the vagueness of a contract relied upon by a
party; it is only concerned with pleadings.
20.
The
onus
is on the excipient
to show both vagueness amounting to embarrassment and embarrassment
amounting to serious prejudice.
[7]
To regress, on 31 May 2019 the University of the Free State, a Higher
Education Institution
duly registered in terms of the
Higher
Education Act 101 of 1997
lodged an action against Christo Strydom
Nutrition (CSN), a company with limited liability, wherein they claim
payment of the amount
of R768 330.25 (SEVEN HUNDRED AND SIXTY-EIGHT
THOUSAND THREE HUNDRED AND THIRTY RAND AND TWENTY-FIVE CENT)
being the balance of
the amount which is due, owing and payable by the defendant to the
plaintiff, for GOODS DELIVERED AND/OR SERVICES
RENDERED,
by the plaintiff to
the defendant.
[8]
The plaintiff issued summons against the defendant based on a written
agreement settled
and signed on 17 September 2015. Christo Strydom
signed the agreement in person. Christo Strydom is a 64-year-old man
and seasoned
businessman. His business is apparently international
and substantial. The agreement is succinct and clear.
[9]
Two defenses were pleaded by CSN:
[7]
The
first defense: “Erroneous citing of parties to the written
agreement/contract”
1.
CSN avers that
the agreement was not entered into between CSN and the plaintiff but
between the plaintiff and an entity known as
Silkblaze 11 (Pty) Ltd
(2007/001392/07).
2.
The defendant
seeks rectification of the agreement on this aspect.
3.
Silkblaze was
represented by Christo Strydom.
4.
At the time
when the agreement was reduced into writing the common intention of
the parties was that the plaintiff and Silkblaze
would enter into the
agreement.
5.
The
plaintiff drafted the agreement and “mistakenly” prepared
the document reflecting the defendant as the contracting
party. “The
mistake was a result of a
bona
fide
mutual error, alternatively an intentional act of the Plaintiff.”
[8]
The
second defense: “Tacit term of the written agreement/contract
not complied with”
1.
The defendant
pleads that in the event it being found that the agreement was not
entered into between the plaintiff and Silkblaze;
it is the case for
CSN that before the parties entered into the contract it was
well-known to the UFS that CSN is a supplier of
nutrition to among
others, wholesalers, retailers and third parties worldwide. Further,
that the UFS, being a university, would
test the aforementioned
products and confirm that the product is of the highest standard as
prescribed by the applicable standards
as well as applicable law to
enable CSN to distribute and sell the nutritional supplements.
2.
It was
therefore in the contemplation of the parties that the University
would be properly accredited to do the contracted tests
and as such
be recognized not only in South Africa; but worldwide.
3.
It was a tacit
agreement that the University’s laboratory is duly accredited
and registered to do the test it undertook.
4.
It is denied
by CSN that the University complied with the written agreement; it is
not accredited to do the periodic evaluations
and inspections and
determine the quality of the product on an international standard.
5.
The above
resulted in CSN’s international contracts to be cancelled.
6.
CSN had to
appoint an internationally accredited entity to do the quality
control testing.
[10]
The Law of Contract in South Africa has come a long way and we have
slowly but surely moved into
the era wherein legal certainty in the
South African common law of contract promotes constitutional visions
in order to stabilise
a fragile democracy and economy.
[9]
[11]
On signing a contract, the
parties become servants to the terms thereof and they acknowledge and
concede to the Law of Contracts.
(The principle of
pacta
sunt servanda
decrees
agreements, freely and voluntarily concluded, must be honoured.) They
pledge themselves to the Rule of Law and an
open and democratic
society based on human dignity, equality and freedom; constitutional
integrity within the facts and circumstances
of their case.
[12]
Parties to a contract are barred from believing themselves to be
above the law and the contract
they committed to. Integrity is
vital to ensure business efficacy and democratic commercial certainty
and security. Lawlessness
will have punitive repercussions.
Anarchistic parties must accept the legal consequences of
non-compliance to contracts; rogue
arrogance towards law and contract
shall not be tolerated by courts.
[13]
That said; the courts must act with perspective restraint. Parties
are servants to the contract,
not slaves. If the facts are clear,
courts may stray from
pacta
sunt servanda
.
The principle of
ubuntu
forms the core of contracts.
Ubuntu
“provides a particularistic context in the law of contract
when, for example, addressing the economic positions or bargaining
powers of the contracting parties”.
[10]
[14]
I would add that aside from the idiosyncrasies parties often commit
and cause, the adjudication
of a case must acknowledge a need for
understanding not vengeance,
ubuntu
and not victimization of
parties; a court should do simple justice between citizens. This is
easier said than done. The above was
decreed in the cases referred to
hereunder.
[15]
The Law of Contracts was stated through the years to be the
following:
1.
In
Basson
v Chilwan and others
[1993] ZASCA 61
;
1993 (3) SA 742
(A) at 762H Eksteen JA referred to: “The paramount importance
of upholding the sanctity of contracts, without which all trade
would
be impossible …” Further, “if there is one thing
that is more than public policy requires, it is that
men of full age
and competent understanding shall have the utmost liberty of
contracting, and that their contracts when entered
into freely and
voluntarily shall be held sacred and shall be enforced by courts of
justice. Therefore, you have this paramount
public policy to consider
- that you are not lightly to interfere with this freedom of
contract.”
2.
Justice Ackermann in
Ferreira
v Levin NO; Vryenhoek v Powell NO
1996 (1) SA 984
(CC) at paragraph 26 described it as “a central
consideration in a constitutional state. These statements aim for
reasonable
certainty, so that parties can go about their business
knowing the rules of the game; constitutional economic integrity is
vital.”
3.
Moseneke J (as he then was) pointed out
in his dissent in
Barkhuizen v Napier
[2007] ZACC 5
;
2007 (5) SA 323
(CC) at paragraph 98 that: “Public policy
cannot be determined at the behest of the idiosyncrasies of
individual contracting
parties. If it were so, the determination of
public policy would be held ransom by the infinite variations to be
found in any set
of contracting parties.”
4.
In
Beadica
231 CC and others v Trustees, Oregon Trust and others
2020 (5) SA 247
(CC) (“Beadica 231 CC”) an intricate
academic researched exposé was given on the modern
Constitutional Law of
Contract in South Africa to guide courts in the
adjudication of these matters. It was concluded that the impact of
the Constitution
on the enforcement of contractual terms through the
determination of public policy was profound. As was stated
in Barkhuizen,
it required that courts employ (the Constitution
and) its values to achieve a balance that strikes down the
unacceptable
excesses of freedom of contract, while seeking to permit
individuals the dignity and autonomy of regulating their own lives.
Public
policy imported values of fairness, reasonableness, justice
and
ubuntu
.
5.
Pacta sunt
servanda
(agreements
must be kept) and “perceptive restraint” must be balanced
on the facts of the case. Nonfulfillment of the
pacta
sunt servanda
should only be in the clearest of cases and as Victor AJ stated:
[231]
This approach leaves space for courts to scrutinize contractual
autonomy whilst at the same time allowing courts to refuse
enforcement of contractual terms that conflict with constitutional
values, even though the parties may have consented to them.
Public
policy must take all these considerations into account and not
implement contractual autonomy at the expense of transformative
constitutionalism. The appropriate balance can readily be achieved
upon a recognition of an 'underlying moral or value choice'
in which
the constitutional values of
ubuntu
feature in this
constitutionally transformative space.
6.
The onus is on the party that claims
a court must deviate from the pacta sunt servanda to proof that the
facts of the case justify
this grave divergence.
[16]
I attached the written agreement to show that the citing of the
parties was clear and unambiguous.
The acronym “CSN” is
on the cover page of the written agreement. It is explained in clause
1.2: “CHRISTO STRYDOM
NUTRITION, ID 5801115065084, 31 Kimberley
Road, Bainsvlei, Bloemfontein (“CSN”).”
[17]
More so, the acronym “CSN” was used about 67 times in the
written agreement. The
claim by CSN that the contracting parties are
the University and Silkblaze 11 (Pty) Ltd is unbelievable on the face
of the written
agreement.
[18]
In clause 2; “Recordal”, it is stated that: “2.1
CSN is a supplier of nutrition
supplements as listed in the schedules
hereto and is desirous to make use of the UFS seals (“Seals”).
[19]
At clause 2.3 “Seals” is described to mean: ““As
tested by the UFS laboratories”,
together with the UFS logo, as
approved by the Department of Marketing.” There can be no
ambiguity that the agreement
does not
include any specific
national or international accreditation; it is as tested by the UFS
laboratories and as approved by the Department
of Marketing. Clause
4.2 refers to the “… standards prescribed by the UFS, …”
[20]
The written agreement consists of 17 clauses and the word
“international” or implication
of internationality do not
feature anywhere. The alleged tacit term averred is specifically
excluded from any operation or legal
consequence between the parties
in, for instance, clauses 2, 11 and 12.
[21]
Christo Strydom may have botched the negotiations and the agreement
when he failed to demand
the now commanded terms be in the written
agreement. He will have to carry the responsibility and consequences
of the reality that
eventuated, not the University. He was on an
equal footing with the University during the signing of the written
agreement and
is not a frail participant. As said; he seems to be an
experienced, knowledgeable and international businessman. The written
agreement
could not be clearer.
[22]
It will be a travesty of justice to allow the matter to go to trial.
The prejudice to the excipient
is clear; it will be a waste of
resources of which time and money count for the most. As
pointed out; the law is that a
n
exception is a valuable part of the system of procedure. Its
principal use is to raise and obtain a speedy and economical decision
on questions of law which are apparent on the face of the facts in
the pleadings.
[23]
There is nothing more to do by the excipient than to produce the
written agreement and it speaks
for itself. It is valid and
constitutionally enforceable as it is. The defenses averred by CSN
are bad in law in comparison.
[24]
Apart from the above; clause 10 decrees that should any dispute arise
between the parties to
this agreement with regard to the
interpretation, implementation, execution or termination of this
agreement, such shall be submitted
to arbitration. It seems as if
this was not complied with by CSN in terms of the agreement.
Litigation in the High Court on the
defense itself of CSN may thus be
premature and illegal in terms of the written agreement.
[25]
The defendant’s plea is bad in law, without merit and not
trailable without severe prejudice
to the excipient and the
administration of justice.
[26]
ORDER
1.
The exception
is upheld with costs on both defenses.
2.
The
respondent/defendant
[11]
is
granted leave to amend the pleadings to remove the cause of
complaint(s)/exception(s) within fifteen (15) days of the granting
of
this order, failing which, leave is granted to the
excipient/plaintiff
[12]
, after
proper notice to the respondent/defendant, to apply for judgment on
the claim in the main action.
M
OPPERMAN, J
APPEARANCES
FOR
THE EXCIPIENT
ADVOCATE C SNYMAN
Chambers,
Bloemfontein
051
430 3567
LE
COMPANIE/E WARD
Phatshoane
Henney Inc
35
Markgraaff Street
WESTDENE
BLOEMFONTEIN
051
400 4000
jeanine@phinc.co.za
marvin@phinc.co.za
karryn@phinc.co.za
Ref:
UNI1-PH/0233/LEC/ew
FOR
THE RESPONDENT
ADVOCATE
S REINDERS
Chambers,
Bloemfontein
051
430 3567
JH
CONRADIE
ROSSOUWS
ATTORNEYS
119
President Reitz Avenue
WESTDENE
BLOEMFONTEIN
051
506 2551
Electronic
service:
e-service@rossouws.com
Ref:
STR74/0009 (JHC/AB)
ADDENDUM
JUDGMENT
CASE
NO: 2433/2019
(AGREEMENT
DATED 17 SEPTEMBER 2015)
[1]
“University”/
“UFS”/ “Plaintiff”/
“Excipient”.
[2]
“CSN”/
“Defendant”/ “Respondent”.
“CSN”
is the acronym for “Christo Strydom Nutrition”.
[3]
Rule 23(1):
Where
any pleading is vague and embarrassing, or lacks averments which are
necessary to sustain an action or defense
,
as the case may be, the opposing party may, within the period
allowed for filing any subsequent pleading, deliver an exception
thereto and may apply to the registrar to set it down for hearing
within 15 days after the delivery of such exception: Provided
that—
(a) where a
party intends to take an exception that a pleading is vague and
embarrassing such party shall, by notice,
within 10 days of receipt
of the pleading, afford the party delivering the pleading, an
opportunity to remove the cause of complaint
within 15 days of such
notice; and
(b) the
party excepting shall, within 10 days from the date on which a reply
to the notice referred to in paragraph
(a) is received, or within 15
days from which such reply is due, deliver the exception.
[Amended by GNR.1262 of
1991 and substituted by GNR.1343 of 18 October 2019.]
[4]
The
written agreement is attached as addendum to the judgment to give
perspective to the reader of the judgment. At paragraph
3.1 of the
Defendant’s Plea, they refer to the agreement as “the
contract” and counsel for CSN also refers
to the agreement as
a contract in his Heads of Argument. Most of the precedent relied
upon by the parties also refer to contracts.
It is thus common cause
that the written agreement has the status of a contract. See
Christie's
Law of Contract in South Africa
,
GB Bradfield, 8th Edition, last updated: 2022, LexisNexis,
https://www.mylexisnexis.co.za/Index.aspx
as
on 14 July 2022 at Chapters 2 & 3.
[5]
Bundle:
“Index” dated 13 April 2022 at pages 38 to 49;
specifically
at paragraph 1.7. on page 41.
[6]
Civil
Procedure in the Superior Courts
,
Part B High Court, UNIFORM RULE 23 EXCEPTIONS AND APPLICATIONS TO
STRIKE OUT, Exceptions, Last Updated: March 2022, LexisNexis,
https://www.mylexisnexis.co.za/Index.aspx
as
on 6 July 2022.
[7]
Bundle
“Index” dated 13 April 2022 at pages 31 to 37.
[8]
Paragraph
2.5 of the Defendant’s Plea.
[9]
2021:
Ali, F,
The
importance of legal certainty in the South African common law of
contract in promoting the constitutional vision,
https://uir.unisa.ac.za/bitstream/handle/10500/28092/dissertation_ali_f.pdf?sequence=1&isAllowed=y
.
(Date
of use: 1 July 2022).
[10]
Beadica
231 CC and others v Trustees, Oregon Trust and others
2020 (5) SA 247
(CC) at paragraph [208].
[11]
CSN
.
[12]
The
University of the Free State.