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[2022] ZAECMKHC 83
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Ndlambe Local Municipality v Quality Filtration Systems (Pty) Ltd and Another (3574/2022) [2022] ZAECMKHC 83 (25 October 2022)
IN
THE HIGH COURT OF SOUTH AFRICA
EASTERN CAPE DIVISION,
MAKHANDA
CASE NO: 3574/2022
In the matter between:
NDLAMBE LOCAL
MUNICIPALITY
Applicant
and
QUALITY FILTRATION
SYSTEMS (PTY) LTD
First Respondent
NEWGROUND PROJECTS
CC
Second Respondent
JUDGMENT
LOWE J
INTRODUCTION
1.
The applicant in this matter, under the
cover of the certificate of urgency given by counsel on 7 October
2022, seeks an order that
the matter proceed as one of urgency and
that pending the final determination of the lawfulness of the first
respondent’s
suspension of works (“
the
suspension
”) under the contract
relevant to the Port Alfred Emergency Reverse Osmosis System (“
the
system”) concluded between
applicant and first respondent and any other disputes that the effect
of first respondent’s
suspension notice dated 26 September
2022, be suspended itself and that first respondent be ordered to
resume its obligations to
applicant pursuant to the contract with
immediate effect. The matter was brought as one of very considerable
urgency and I have
similarly drafted the judgment accordingly in far
less time than I would have liked.
2.
As set out by first respondent in its heads
an analysis of the papers indicates that the central issue relates to
the following
question:
“
Did
the first respondent suspend work because it was not paid timeously,
or did the applicant withhold payments that were due to
the first
respondent, because the first respondent had not done the work?”.
3.
As to urgency, the certificate sets out
that insofar as applicant is concerned the matter arises from a
patent breach of contract
by first respondent relevant to the system
invoking constitutional principles, first respondent being the entity
contracted by
applicant to provide the services relevant to the
system, which, alleges applicant, first respondent being in breach of
the contract
between the two parties relevant to the operation of the
system.
4.
Port Alfred has a population of
approximately 35 000 people previously supplied with a bulk water
supply from the Kowie river and
Sarel Hayward dam. Due to the drought
these have been depleted and the current water demand of the
community is some 6,54 ML/day
with an increased demand during the
festive season which is simply not being met. Port Alfred at the
moment gets 3.1 ML/day
from other sources and the closure of the
system is, says applicant, as a result of first respondent’s
breach having an immediate
negative impact on the availability of
water to the community. In short temporary steps have been taken to
alleviate the position
by the trucking of water at the cost of
R111 000,00 per day as a so-called “
stop-gap
arrangement
.”
5.
To put it shortly, applicant relies on the
terms of the contract between the parties including what is referred
to as the “FIDIC”
document arguing in the context of its
admitted non-payment of first respondent that this non-payment was
justified, applicant
being in breach of the agreement on the one
hand, and on the other having failed to give the necessary twenty-one
days’ notice
in terms of clause 16.1 of FIDIC before suspending
its operations.
6.
It is submitted then shortly, that being in
breach of the agreement, and not being entitled to suspend the
operations of the works,
as it has done, applicant is entitled to an
order compelling first respondent as a matter of specific performance
to continue with
the works and to perform its obligations, pending
dispute resolution and arbitration in terms of the contract.
7.
In response, first respondent submits, to
the contrary, that first respondent is by no means in breach of the
FIDIC agreement in
any way, that it is in fact applicant whose
failure to pay first respondent in terms of the contract that has
precipitated not
only the urgency but the dispute between the
parties, that failure to pay being unjustified in terms of the facts,
circumstances
and contract, and that first respondent in turn and in
terms of the FIDIC contract, particularly clauses 14.8 and 16.1
thereof,
read with the correspondence, was entitled to suspend the
works as it has done, pending compliance therewith.
8.
It is argued further that the second string
to applicant’s bow is that first respondent failed to deliver
the required output.
This, says first respondent, is unjustified,
incorrect and simply an excuse not to pay first respondent. It is
alleged in terms
that it is first respondent’s stance that
applicant and the application is motivated solely by applicant
seeking to compel
first respondent to provide services without
payment being made by applicant to first respondent for the amounts
certified by applicant’s
own representative as being due and
payable. The impasse says first respondent would be resolved, the
suspension of the works would
be lifted and the entire dispute
eliminated, or if there were any remaining aspects referred to
arbitration as required in the
agreement, if applicant made payment
as it is obliged to do.
9.
Thus not only does first respondent
challenge the urgency of the matter stating that this is self-created
by applicant’s unilateral
conduct in breach of the contract,
but further that applicant is simply wrong as to its attitude, in
breach of its obligation to
pay, entitling first respondent on notice
to suspend which notice, first respondent alleges, was contractually
given to suspend
the works.
URGENCY:
PRINCIPLES
10.
Urgency
must be judged against the background of Rule 6(12) of the Uniform
Rules of Court and Rule 12(d) of the Eastern Cape Practice
Directions
[1]
.
11.
Urgent applications require an Applicant to
persuade the Court that non-compliance with the Rules, and the extent
thereof, is justified
on the grounds of urgency. Applicant must
demonstrate
inter alia
that it will suffer real loss or damage were it to rely on normal
procedure.
12.
The Rules adopted by an Applicant in such
an application must, as far as practicable, be in accordance with the
existing Rules both
as to procedure and time periods applicable.
13.
A
Respondent faced with an urgent application, and to avoid the risk of
judgment being given against it by default, is obliged provisionally
to accept the Rules set by Applicant and then, when the matter is
heard, make its objections thereto if any
[2]
.
14.
In
Nelson
Mandela Metropolitan Municipality & Others v Greyvenouw CC and
Others
[3]
Plasket AJ (as he then was) said as follows:
“
[37]
It is trite that applicants in urgent applications must give proper
consideration to the degree of urgency and tailor
the notice of
motion to that degree of urgency. It is also true that when Courts
are enjoined by Rule 6(12) to deal with urgent
applications in
accordance with procedures that follow the Rules as far as possible,
this involves the exercise of a judicial discretion
by a Court
'concerning which deviations it will tolerate in a specific case'.
[38]
… it is not in every case in which the applicant may have
departed from the Rules to an unwarranted extent
that the appropriate
remedy is the dismissal of the application. Each case depends on its
special facts and circumstances. This
is implicitly recognised by
Kroon J in the
Caledon Street Restaurants CC
case
when he held - looking at the issue from the other perspective, as it
were - that the 'approach should rather be that
there are times
where, by way of non-suiting an applicant, the point must clearly be
made that the Rules should be obeyed and that
the interest of the
other party and his lawyers should be accorded proper respect, and
the matter must be looked at to consider
whether the case is such a
time or not'.
…
[40]
… Indeed, the erstwhile Appellate Division has on a number of
occasions turned its back on such formalism
in the application of the
Rules. For instance, in
Trans-African
Insurance Co Ltd v Maluleka
Schreiner
JA held that 'technical objections to less than perfect
procedural steps should not be permitted, in the absence
of
prejudice, to interfere with the expeditious and, if possible,
inexpensive decision of cases on their real merits'. …
in
D
F Scott (EP) (Pty) Ltd v Golden Valley Supermarket,
Harms JA held that the Rules 'are designed to ensure a fair
hearing and should be interpreted in such a way as to advance,
and
not reduce, the scope of the entrenched fair trial right' contained
in s 34 of the Constitution.”
[4]
15.
There are degrees of urgency of course. An
Applicant must set out explicitly the circumstances which render the
matter urgent such
as to justify the curtailment of the Rules,
procedures and time periods adopted. That there will be a loss of
substantial redress,
if not heard on the basis chosen, must be shown.
16.
An
Applicant cannot create its own urgency by simply waiting till the
normal rules can no longer be applied.
[5]
17.
If the above is satisfied other issues come
to be considered, some of which are:
17.1 Whether
Respondent can adequately present its case in the time given;
17.2 Other
prejudice to Respondent and the administration of justice;
17.3 The strength
of Applicant’s case and any delay in asserting its rights
(self-created urgency).
THE APPROACH
18.
Having set out the basic situation between
the parties and their submissions in each case, and referring to the
principles of urgency,
I intend dealing with the merits of this
matter together with the issues of urgency determining both insofar
as is necessary.
19.
It must be said, however, that certainly
the issue of the provision of water to a community is necessarily one
of great urgency
having regard not only to the constitutional issues
involved but also simply that water is a necessity in respect of both
life
itself and relating to health, safety and standards involving
sewerage as an example.
20.
As to urgency the main issue raised by
first respondent is really limited to the submission that it is, as I
have said, applicant
that has created the impasse by its non-payment
and therefore created its own urgency. I will deal with this in due
course at an
appropriate place hereafter.
21.
It must be said, however, that one’s
inclination is to treat the matter as one of urgency, in the context
of the dispute,
as a decision made on the merits in this matter will
undoubtedly assist in resolving the impasse between the parties in
the interests
of all.
22.
It is perhaps worth mentioning that first
respondent also contends that the dispute between the parties has
been building for months
and that this of itself contributes to the
lack of urgency contended for.
THE ISSUES RELEVANT
TO THE SUSPENSION OF THE WORKS AND THE DISPUTE BETWEEN THE PARTIES
23.
The tender implicated in this matter was
awarded and the contract was signed between the parties with a
commencement date on 10
December 2020.
24.
The tender involved two projects namely:
24.1
a sea water reverse osmosis plant to
provide 2 mega litres per day; and
24.2
a reclamation reverse osmosis plant to
provide 3 mega litres per day.
25.
The two plants were, says first respondent,
inter dependant, water from the reclamation reverse osmosis plant
being required to
dilute the sea water brine, the two plants
accordingly not being separate units but inter dependant.
26.
Second respondent (who does not oppose the
matter) was appointed as applicant’s representative and has no
authority to release
either party from its obligations.
27.
The contract, importantly incorporates the
FIDIC DBO Contract Guide first edition 2011 being conditions of
contract for design,
build and the operation of projects (FIDIC).
28.
The principle issue between the parties is
whether first respondent was contractually entitled to suspend all
works at the two water
reverse osmosis works in Port Alfred on 30
September 2022, it accordingly presently not performing any of its
contractual duties
in terms of the contract between applicant and
first respondent, this drastically affecting the production of water
from the plant.
29.
The contract has terms relevant to payment
certification this being particularly in FIDIC paragraph 14.7
relating to the issue of
advance and interim payment certificates.
30.
Once a payment certificate has been given,
clause 14.8 of FIDIC provides the manner in which payment is to take
place namely:
“
The
employer shall pay to the contractor:
a.
…
.
b.
The amount certified in each Interim
Payment Certificate within 56 days after the Employer’s
Representative receives the corresponding
Statement and supporting
documents, including any amounts due in accordance with a decision of
the DAB which have been included
in the Interim Payment Certificate;
and
c.
…”
31.
In respect of payment certificate 12 the
Employer’s Representative, Mr. L. Fourie, issued a payment
certificate 12 on 21 June
2022 for R2 155 975,00. This certificate
had no payment qualifications and in terms of clause 14.8 of FIDIC
was then due 56 days
from the date when the payment certificate was
submitted to the Employer’s Representative. On 22 August 2022
first respondent
notified the applicant of the fact of non-payment in
terms of clause 14.8 of the FIDIC contract. This is dealt with in
annexure
FA6 to the papers, a letter addressed by first respondent to
the Employer’s Representative dated 20 September 2022
(subsequent
to notification allegedly of the fact of non-payment).
This document is said to be a notice in terms of the contract
described
as follows:
“
Notice:
PC12 - Subclause 16.1: Contractor’s Entitlement to Suspend Work
(2)”.
32.
There follows a recitation of
communications having reference including LoC135 described as “
Notice
14.8 delayed payment – 1
…”
33.
There is also reference to LoC142 Notice
being described as “Notice: PC12 – Sub-clause 16.1;
Contractor’s Entitlement
to Suspend Work”.
34.
The background in the document is clearly
set out relevant to payment statement 12 and it is said that first
respondent did not
receive payment and proceeded to notify the
employer on 22 August 2022 of its failure to make payment. It was
said that this was
“…
done
as per the requirement of Sub-clause 14.8 of FIDIC DBO.
”
It is then said:
“
On
13 September 2022, QFS notified (See LOC142) the Employer of its duty
to pay and stated that should the Employer fail to action
the payment
of PC12, by the 20
th
September 2022, then QFS will exercise their right to suspend the
works as per Sub-Clause 16.1 of FIDIC DBO
.”
35.
The
last paragraph under heading “
Suspension
”
informs with reference to Sub-Clause 16.1 of FIDIC, the employer that
the right would be to exercise to suspend at 18h00
on 20 September
2022 due to non-payment. It is important to note that there is no
reference to any amounts due by way of a DAB
decision.
[6]
Importantly the founding papers in this regard accept in annexing the
notice that it was given in terms of clause 16.1 and 16.2
by FIDIC,
and applicant would accrue a right to terminate on the expire of 21
days, and made payment accordingly.
36.
Moving forward it is common cause that
applicant did not pay the sum of R2 155 975,00 by 20
September 2022, though the
payment certificate was in fact paid at a
later date and is currently settled.
37.
Perhaps more important, is that the
Employer’s Representative issued payment certificate 13 in the
amount of R1 323 273,00
on 25 July 2022.
38.
Again, in summary, this as set out
previously was due within 56 days and on this occasion and in terms
of annexure FA8 the sequence
of events is set out. In short this
communication, dated 26 September 2022, had the same heading as the
previous notice in respect
of statement 12 but referred to statement
13 and specifically the heading under “
Notice
”
stated and referred to the contractor’s entitlement to suspend
works in terms of sub-clause 16.1.
39.
The documents to which reference was made
contained
inter alia
reference to payment certificate 13 and reference to LoC140 being a
“
notice
”
in terms of clause 14.8 referring to “
delayed
payment
”. The background, as
previously, is set out in detail relevant to the interim payment
statement 13 having been submitted
on 4 July 2022 being approved by
applicant’s representative and payment certificate 13 being
issued as well as an invoice.
Payment was due within 56 days thereof,
the contractual date for which it being stated as 29 August 2022. The
following paragraph
then sets out that:
“
On
the 9
th
of September 2022, QFS notified the Employer (See LoC141), as per the
requirements of Sub-clause 14.8 of FIDIC DBO, about its failure
to
pay them for Statement 13 (PC13). The payment was already 11 days
overdue.”
40.
The notice then continues to set out that
as at the date of the notice, 26 September 2022, 17 days after
LoC141, only part of the
sum had been paid leaving R692 862,71 still
due to the contractor. It is then said that in terms of sub-clause
16.1 of FIDIC the
contractor was entitled to suspend the works, 21
days after notice of failure to comply with sub-clause 14.8, giving
notice of
their exercise of the right on 30 September 2022 should
payment not be made by that date.
41.
First respondent argues that this was
contractually justified and the notices compliant with FIDIC.
Applicant on the contrary argues
that the notices were not
contractually compliant and did not set the basis for suspension.
42.
Turning to the contract itself, there is no
doubt that clause 14.8 thereof required payment of Interim Payment
Certificates (as
in this matter) within 56 days of receipt of the
corresponding statement and supporting documents. There seems to be
no dispute
that the payment certificates were given as indicated in
respect of 12 and 13. Payment certificate 13 remains partially
unpaid.
That certificate is the basis for the decision to finally
suspend the works by first respondent.
43.
Clause 14.8 itself does not provide for or
require any notice. It however provides strict time limits upon the
employer (applicant)
within which to pay and if applicant fails to
meet those dates affords first respondent contractual rights in terms
of clause 16.1.
Those rights are to firstly suspend the work until
payment is received and then if payment has not been received within
42 days
after the period stated in clause 14.8 the first respondent
may terminate the contract.
44.
Turning to clause 16.1, upon failure to
make clause 14.8 payment timeously “…
the
Contractor may, not less than 21 days after giving Notice to the
Employer, suspend work … unless and until the Contractor
has
received the Interim Payment Certificate, reasonable evidence or
payment as the case may be and as described in the Notice.
”
45.
This is the main provision in FIDIC
entitling the contractor to suspend work. It is clear that this
enables first respondent to
put pressure on applicant to honour its
payment obligations without taking the step of terminating the
contract or unlawfully refusing
to work if not paid.
46.
The concept of giving notice as provided in
clause 16.1 requires reference back to clause 1.3 of FIDIC which in
summary requires
the notice to be identified as a “
notice
”
and must be such as to “
include
reference to the Clause under which it is issued
”.
47.
Perhaps the main issue between the parties
is whether the notices and particularly that relevant to payment
certificate 13, which
remains unpaid, complies with FIDIC entitling
suspension.
48.
In my view “FA8” more than
clearly identifies the document as a “
notice
”
and refers again more than clearly to LoC140 being “
Notice
14.8 Delayed Payment
”. In terms,
the notice then continues to set out the time line being a due date
for payment on 29 August 2022 in respect
of payment certificate 13.
However, there was a delay in respect of the issue of a notice, and
LoC141 is referred to being a letter
of 9 September 2022 “
as
per the requirements of sub-clause 14.8
”.
It is clear in the context of the papers and annexures that this is a
notification to applicant concerning its failure
to pay payment
certificate 13 then being “
already
11 days overdue
”.
49.
It cannot be seriously contested, in my
view, that on 9 September 2022 there was written notice given by
first respondent to applicant
that there had been a failure to pay
payment certificate 13, then 11 days overdue, the time line then
commencing to run from 9
September 2022 affording applicant not less
than 21 days to make payment. The letter of 26 September 2022 also
being a “
notice
”
referred to all of the above and repeated in terms of clause 16.1, a
special reference thereto, of its entitlement to suspend
within 21
days after notice of failure to comply with clause 14.8 referring to
the fact that this right would accrue on 30 September
2022.
50.
The argument for applicant, that this
notice (of 26 September) was uncontractual as not giving sufficient
period, and in addition
not sufficiently referring to clause 16.1 and
relying on 14.8, is objectionable and falls to be rejected. Whilst it
is true that
LoC141 is not included in the papers, and purports to be
given in terms of sub-clause 14.8 of FIDIC, it is clear on any
sensible
reading of the notice of 26 September which sets out fully
to those involved and who would have been in possession of all the
correspondence
and notices, the entire time line and there can be no
doubt, in my view, that on a proper reading thereof, applicant would
have
been more than fully aware that it had received notice in
respect of the non-payment of an amount due in terms of clause 14.8,
warning of the failure to pay within 21 days of the giving of the
notice as being such as to entitle suspension, a reminder hereof
being given on 26 September 2022, the 21 days period expiring as of
30 September 2022.
51.
There was no dispute between the parties in
argument as to the proper interpretation of the clauses of the
contract relevant, but
rather whether there had been strict
compliance therewith.
52.
In
my view, to hold to the contrary, would be an exercise in futile
formality, in circumstances in which the notices clearly referred
to
would have left no doubt whatsoever in applicant’s mind as to
the fact that demand for payment was being made, that notice
of
non-payment had been given, and that absent payment within the
stipulated contractual 21 day period this would result in the
suspension of the works.
[7]
53.
In
my view, accordingly, the applicant’s argument in this regard,
that first respondent was not entitled to suspend the contract
pending payment, is such as to be rejected. A further consequence of
this, is that on the face of it, applicant is indebted to
first
respondent in respect of at least payment certificate 13 which
remains unpaid in part.
[8]
Again
I am not able to see any DOB deductions in the certificate which is
significant, the amount certified is what is to be paid
in terms of
FIDIC.
54.
Whilst the founding papers set out what is
contended by applicant as the history of the matter, the contract
commencing on 10 December
2020, with the extension of the completion
date in respect of the second component of the works to 31 July 2021,
and says applicant,
completion date not being achieved this being
finally achieved “
after July
2021
”
,
the breaches relied upon in the application are:
54.1
That the output generated by the sea water
osmosis component was lower than the required design output, being
alleged that the plant
did not meet the production requirements
prescribed and thus was a breach of first respondent’s
obligation;
54.2
That there was a demand by applicant upon
first respondent flowing from its failure to make good within 14
days;
54.3
That in fact first respondent’s
failure to deliver the required output relieves applicant of the
obligation to pay amounts
certified in payment certificates but that
the issue need not detain this court as it will be ventilated in
dispute resolution
proceedings in due course;
54.4
Thus without identifying any “breach”
linked specifically to the relief sought in the matter (specific
performance),
applicant then joins issue on the question of
non-payment particularly in respect of payment certificate 13;
54.5
Thus, coming back to the first relevant
“breach” referred to above, applicant states that in fact
first respondent failed
to comply with its obligations under clause
16.1, was not entitled as I understand it to suspend and is thus in
breach of the contract.
55.
Applicant’s papers are somewhat
confusing, inasmuch as it seeks specific performance but contends for
an entitlement to terminate
whatever the position is with certificate
13, first respondent being alleged to be in default. Indeed,
applicant has issued a notice
of breach dated 5 October 2022 “FA10”.
56.
Applicant concedes that the court is not
required to make a “
final
pronouncement
” on the lawfulness
of the conduct of first respondent or any issue arising out of it as
the contract requires the parties
to refer such disputes to
adjudication and thereafter arbitration if necessary. It is said then
that applicant seeks interim relief
pending the final resolution of
the disputes between the parties, that being so it is said, that
first respondent must be ordered
to continue with (resume) its
obligations to applicant in providing the services envisaged in the
contract pending the final resolution
of those disputes, this being
interim relief.
57.
The above analysis whilst in many ways
self-contradictory, establishes that in essence applicant seeks an
order compelling compliance
as one of specific performance, pending
whatever may happen in the dispute resolution mechanism provided for
in the contract.
58.
First respondent’s answer that it is
entitled to suspend the works for lack of payment, is met by way of a
technical analysis
of the notices given and the submission that they
were not given in terms of the contract, something I have already
dealt with
and dismissed.
59.
That being so, it follows, that applicant
cannot succeed in the relief sought even on an interim basis in this
application, as the
entitlement to suspend vested in first respondent
defeats the relief sought.
60.
Indeed, Mr. Olivier for applicant, in
setting out the common cause facts in his heads of argument, states
that the disputes of facts
evident from the lengthy papers are
irrelevant, having regard to the works suspension adverted to above,
referring to clause 16.1
of the contract, to the correspondence (I
have already referred to) and the allegation that first respondent
had failed to adhere
to clause 16.1 and had not given the necessary
21 days notice before suspending.
61.
Secondly, Mr. Oliver points to the dispute
between the parties relating to first respondent’s compliance
with the terms of
the agreement, which was referred to the Dispute
Adjudication Board in terms of clause 20 of FIDIC which findings were
provided
on 13 October 2022. He points out that first respondent was
found not to have complied with the requirements stipulated in the
tender relevant to the production specifications of the plant. The
remedy was to impose penalties and to recover these from the
amount
due on contract as payment certificates.
62.
Mr. Oliver points out that this decision by
DAB is enforceable and stands until set aside. The difficulty with
this argument is
that the certificates do not discernibly reflect any
amount owing by first respondent to applicant in this regard, nor is
same
deducted from the certificate.
63.
The second difficulty with the argument, is
that this is not raised in the founding papers as any basis for the
relief sought, or
indeed as a defence to the claim for payment such
as to disentitle first respondent from suspending the works. This is
raised in
reply but nothing is pointed to in the payment certificates
as per clause 14.8.
64.
Indeed, the adjudication referred to dated
13 October 2022, comes subsequent to the launching of the application
and is dealt with
only in reply. The adjudication is raised in reply
for the first time in the context that it is argued in the papers,
that there
can be no failure on the part of the applicant to make
payment where first respondent alleged that it met the requirements
of the
contract and that first respondent had been found to be in
breach of its design and construction obligations.
65.
It seems to me, that this entirely misses
the point, and that one has to look to the founding papers to
determine whether the case
made out is sustainable, with such
legitimate reply to the answering papers as may be found to be in
place.
66.
It must be remembered, that in the founding
papers, there is no suggestion made that payment was not due in
payment certificate
13, or that a claim was being set off against
such payment certificate justifying non-payment thereof.
67.
The payment certificates were issued by
applicant’s own representative as being due and payable.
68.
It is, it must be remembered, first
respondent’s case and this set out in annexure FA13 that first
respondent tendered performance
of its obligations against payment
which was repeatedly delayed, first respondent stating that it could
not sustain these services
absent payment.
69.
Indeed, it is plain from the papers, and
the correspondence, that immediately payment is made in respect of
outstanding payment
certificates as certified, the work will
recommence.
70.
On an overall consideration of the basis of
the application, and the arguments made, there can be no doubt, that
applicant was indebted
to first respondent in respect of payment
certificate 13, and was in breach of the contract and subject to
clause 16 notice accordingly.
On the construction of that notice
against the terms of the contract, as I have already concluded, the
provisions of clause 16.1
came into operation affording first
respondent the right to suspend the works in the event of non-payment
being persisted in for
21 days post notice. This seems to me to be
clearly established. It is clear from the contract that if applicant
fails to comply
with its payment obligations in terms of clauses 14.7
and 14.8 and upon proper notice being given under clause 16.1 first
respondent
accrues the right to suspend.
71.
In the result, and on the basis of the
allegations made by applicant, and having regard to the conclusion I
have reached above in
respect of non-payment and notice, first
respondent has more than sufficiently demonstrated its entitlement to
suspend.
72.
In those circumstances, applicant
consequently is not entitled to the relief it seeks compelling first
respondent to suspend its
suspension notice or that it should be
ordered to resume its obligations.
URGENCY: RESULTS
73.
Having considered all the papers as a
whole, and the disputes between the parties, it seems to me that
having regard to the importance
of water delivery to the citizens
relevant within the area of the municipality, and the constitutional
obligations in this regard,
the matter was of sufficient urgency to
warrant being heard, even though the issues arose consequent upon
applicant’s unjustified
non-payment to first respondent of
certificate 13 in its remaining amount.
74.
I say so in addition having regard to the
need to reach a basis for resolving the continued conflict between
applicant and first
respondent, and to afford a basis for the parties
to reach a situation where service delivery may be recommenced as
soon as possible
– which would not have been the case had the
matter not been heard and struck off the roll for want of urgency.
75.
As already pointed out above the urgent
time line has required this judgment to be produced under
considerable pressure and in less
time that I would have liked.
COSTS
76.
As to costs, it seems clear that the usual
order that costs follow the result must follow.
ORDER
77.
In the result the following order issues:
1.
The application is dismissed.
2.
Applicant is to pay first respondent’s
costs of the application.
M.J. LOWE
JUDGE OF THE HIGH
COURT
Appearing on behalf of
the Applicant:
Adv. Olivier, instructed by Moletsane PN Attorneys Inc, East London,
c/o Yokwana Attorneys, Grahamstown, Mr. Moletsane
Appearing on behalf of
the First Respondent:
Adv.
Cole S.C. instructed by Netteltons Attorneys, Grahamstown, Ms.
Pienaar.
Date heard:
18 October 2022
Date delivered:
25 October 2022
[1]
Bobotyana
supra
[2]
Caledon
Street Restaurants CC v D’Aviera
[1998]
JOL 1832
(SE).
In
re: Several Matters on the Urgent Roll
[2012]
4 All SA 570
(GSJ) [15]
[3]
2004 (2) SA 81
(SE) [37], [38] and [40].
[4]
But see:
Murray
& Others NNO v African Global Holdings (Pty) Ltd & Others
2020
(2) SA 93
(SCA) [35], [38], [39] and [40]
[5]
Lindeque
and Others v Hirsch and Others, In Re: Prepaid24 (Pty) Limited
(2019/8846) [2019] ZAGPJHC 122 (3 May 2019) [10];
Masipa
& Another v Masipa 2020
JDR
1054 (GP);
Edrei
Investments 9 Ltd (In Liquidation) v Dis-Chem Pharmacies (Pty) Ltd
2012
(2) SA 553 (ECP);
Bandle
Investments (Pty) Ltd v Registrar of Deeds and Others
2001
(2) SA 203 (SE) 213;
East
Rock Trading 7 (Pty) Ltd and Another v Eagle Valley Granite (Pty)
Ltd and Others
(11/33767)
[2011] ZAGPJHC 196 (23 September 2011) [6] and [9] – The fact
that Applicant now wants the matter resolved urgently
does not
render the matter urgent;
Ntozini
and Others v African National Congress and Others
(18798/2018) [2018] ZAGPJHC 415 (25 June 2018) 415.
[6]
This
is important as there was reference in argument to a DAB decision
against first respondent which is not referred to in the
payment
certificate 12 or payment certificate 13. This is of fundamental
importance to each certificate and the amount due.
[7]
Clearly reading clause 14.8 and 16.1 together and referring to same
in terms there cannot have been any misapprehension in this
regard.
[8]
In
this regard I do not overlook that first respondent’s
answering affidavit is terse and does not on occasion do more than
put applicant to the proof. However this perhaps not unexpected
given the stringent time line imposed in the urgent application.