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[2020] ZAGPPHC 187
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Malele and Others v S (A283/17; CC104/2013) [2020] ZAGPPHC 187 (17 February 2020)
REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH
AFRICA
GAUTENG DIVISION, PRETORIA
(1)
REPORTABLE:
NO
(2)
OF
INTEREST TO OTHER JUDGES: NO
(3)
REVISED.
CASE NO: 2017/84381
28/4/2020
In
the matter between:
BESTMAX
INVESTMENTS (PTY) LTD
Plaintiff
(Registration
No: 2011/118360/07)
and
SOFT
START BTI (NPC) (PTY) LTD
Defendant
NON-PROFIT
ORGANISATION NO: 033-728
(Registration
No: 2000/028790/08)
JUDGMENT
MOKOSE
J
Introduction
[1]
The plaintiff seeks damages in an action in which it claims the
defendant
has been enriched at its expense. The alleged enrichment
centres on the plaintiff's construction of an advertising structure
on
the roof of the defendant's building which abuts onto the M1
Highway, which highway links Pretoria, Midrand and Johannesburg.
[2]
The defendant denies that it has been enriched in the respects as
alleged
by the plaintiff or at all. The defendant counterclaims and
seeks an order against the plaintiff for the removal of the
advertising
structure, the reinstallation of the previously erected
structure and for the repair of any damages to the defendant's
property.
[3]
The defendant's counterclaim became settled between the parties with
no
order as to costs. The parties agreed that the reasonable cost of
the removal of the advertising structure is the sum of R94 200,00.
It
was further agreed that should the plaintiff succeed in respect of
Claim A {the enrichment action) then the defendant will be
liable to
make payment to the plaintiff of the agreed or reasonable cost of the
removal of the advertising structure being the
sum of R94 200,00. But
should the plaintiff's claim in respect of Claim A be dismissed, then
the plaintiff would be liable for
costs associated with the removal
of the advertising structure. No further amount would be payable by
the defendant to the plaintiff
in this regard.
[4]
The defendant amended his plea with the leave of the court to allege
that
the defendant demanded the removal of the advertising structure
as long ago as 23 May 2016 to reflect that the plaintiff has removed
the advertising structure.
[5]
A notice of a claim being ceded in terms of a cession dated 1 June
2016 between Mega
Line and the plaintiff was forwarded to the
defendant together with a letter of demand to provide the plaintiff
and its appointed
contractors access to the site for the purposes of
erecting the advertisement.
The
plaintiff's pleaded case
[6]
The plaintiff alleges in
its particulars of claim that during September 2014 Mega Line and the
defendant concluded a written lease
agreement pertaining to the
display of advertisements on the defendant's property and in respect
of which Mega Line obtained a
right to sublet the property for
purposes of the display of advertisements.
[7]
The lease agreement contained a condition precedent which read as
follows:
"4.
CONDITION PRECENT
4.1
This agreement (save for this clause
4 and
clauses
2,
15, 17 and 18 all of which shall become effective immediately on the
signature date}
is
subject
of the fulfilment of the following conditions precedent on
or
before 28 November 2014 ("the
cut-off date").
4.1.1
The Lessee obtains the consents of
such local and/or national authority
as
may be required for the erection of
the advertising structure and the display of the advertisements,·
or
4.1.2
Furnish the Lessor with the
confirmation in writing to the reasonable satisfaction of the Lessor
that no such
consents
are
required.
[8]
The lease states further that the conditions precedent are inserted
for the benefit
of all the parties who will be entitled to waive
fulfilment of such condition precedent in whole or in part by written
agreement
prior to the cut-off dat. Furthermore, if the conditions
precedent are not fulfilled or waived by the cut-off date, then
notwithstanding
any provisions to the contrary, the agreement shall
never become effective. The lessee, at its own cost, was entitled to
made all
such applications as may be required in the fulfilment of
such conditions and the lessor would provide such co-operation and
assistance
as may be necessary in the circumstances. The lessor
undertook to sign all documentation in connection therewith.
[9]
The plaintiff's particulars further allege that during March 2015 the
plaintiff and
Mega Line concluded a sublease in respect of the
property on terms and conditions which were practically the same as
those in the
written lease agreement between the defendant and Mega
Line. Importantly, the sublease contained the conditions precedent,
the
only changes being in respect of the details of the lessee and
lessor and the rental amount. The suspensive condition was to be
fulfilled by 28 November 2014.
[10]
The particulars allege further that during February 2016 the
defendant entered into direct negotiations
with the plaintiff and
granted the plaintiff access to the property for the purposes of
erecting the advertising structure. The
plaintiff had a
bona fide
belief that a valid lease agreement had been concluded and acted
in respect of the subject matter that comprises claims A to C.
[11]
Claim A - the plaintiff alleges that it attended to the manufacturing
and erection of the
advertising structure attached to the property
owned by the defendant and that it had incurred expenses in so doing.
The value
of the said property increased in the sum of R469 173,52
and resulted in the impoverishment of the plaintiff.
[12] Claim
B - the plaintiff alleges that during July 2015 the plaintiff
attended to the removal
of trees obstructing the view of the
advertising structure which resulted in the alleged increase to the
value of the defendant's
property by the enhanced view of the
advertising structure. The amount claimed is the sum of R19 500,00.
[13]
Claim C - the plaintiff alleges that in July 2016 that the plaintiff
attended to the printing
of advertising material (a wrap or skin) and
that the advertising material printed added to the value of the
property of the defendant.
It is alleged that as a result, the
defendant was enriched to the amount of R43 698,48.
[14]
It is apparent from an analysis of the pleadings that 'negotiations'
were allegedly held with
the defendant after the date of fulfilment
of the condition precedent had passed and that the manufacturing,
erection and installation
of the advertising structure had also
occurred on a date after the fulfilment of the conditions precedent.
The plaintiff does not
allege in its particulars of claim that any
agreement had been reached between the parties and it appears that
its cause of action
is premised on the
condictio indebiti.
[15]
The defendant admits, in its plea the existence of the written lease
agreement and that the condition
precedent had not been fulfilled.
The defendant however denied that the plaintiff held the alleged
bona
fide
belief and that the defendant had been impoverished.
Issue
[16]
The questions to be decided by the court are the following:
(i)
whether the plaintiff had made a 'transfer' or performed
indebite
or without just cause to the
defendant; and
(ii)
whether the plaintiff was impoverished by the performance made to the
defendant.
Legal
Principles
[17]
The requirements for a claim for a
condictio
indebiti
are
trite. There must obviously be an enrichment by the defendant at the
impoverishment of the plaintiff.
[1]
At the heart of these
requirements is that a party has performed pursuant to an excusable
error and mistaken belief.
[2]
[18]
The burden on proof of these elements is on the plaintiff. In the
matter of
Recsey
v Reiche
[3]
it was held that the onus
in an action based on the
condictio
indebiti
'lies
throughout the whole case' on the plaintiff. This remark was intended
to refer to every element constituting the plaintiffs
cause of action
which includes the excusability of the error i.e. whether the error
or mistake was
bona
fide.
The error
or mistake must be established by the plaintiff in his evidence and
it must have been reasonable. The enquiry into whether
the conduct of
the plaintiff is excusable is directed at the reasons for and the
circumstances in which the payment or transfer
was made.
[4]
[19]
It is trite that a contract containing a suspensive condition is
enforceable immediately
upon its conclusion but some of the
obligations are postponed pending the fulfillment of the suspensive
condition. If the condition
is fulfilled, the contract is deemed to
have existed from the onset of the contract itself. If the condition
is not fulfilled,
then no contract came into existence.
[5]
Evidence
[20]
I will not delve into all the evidence presented by the parties but
will highlight the
common cause facts, corroborated evidence and
discrepancies.
[21]
The plaintiffs first witness was Mr. Nelson Veerasamy who acted as
the Centre Manager at the
time of the conclusion of the written lease
agreement. He testified that he was authorized to act on behalf of
the defendant when
he concluded the lease with Mega Line. He
testified further that the lease agreement ceased to exist on 28
November 2014 due to
the 'cut off date in clause 4 of the lease
agreement. Despite the 'cut off date the advertising structures were
still installed
by the plaintiffs contractors with the full knowledge
and consent of the defendant. He testified further that the defendant
engaged
through its representative with the plaintiff on the removal
of some trees that were obscuring the view to the advertising
structure.
He recommended to the defendant's board that a full wrap
be installed by the plaintiff and engaged directly with the plaintiff
on the design on the wrap and development thereof. This wrap was
intended to be temporary.
[22]
Mr. Craig Schelin, Mega Line's project manager and liaison between
the plaintiff and the defendant,
testified on behalf of the plaintiff
that the signs were approved by Mr. Veerasamy on behalf of the
defendant and that such approval
was after the 'cut off date. Mr.
Schelin testified further that council approval was outstanding due
to the building plans not
being submitted.
[23]
Prior to Mr Polome testifying on behalf of the plaintiff, the
defendant raised an objection to
the evidence of Mr Polome was about
to give as an expert and factual witness. It was brought to the
court's attention that the
expert witness notice was flied on 22
January 2020 which notice was filed out of time. Furthermore, no
joint minute had been prepared
nor a further pre-trial conference had
been held after such notice had been given. The court ruled that Mr
Polome's evidence would
be dealt with as evidence of a factual
witness only.
[24]
Mr. Francois Polome testified that he was a director of Red Dot, a
company which specialized
in outdoor designing and erection of
advertising structures such as the one erected. He testified that the
structure was approved
by a civil engineer who certified that the
structure was safe. He testified further that all the invoices
rendered to the plaintiff
as its subcontractor were paid. He
testified that the erection of the advertising structure was aborted
after the advertising wrap
was damaged beyond repair as a result of a
severe storm when it was being installed. His company accepted
responsibility for the
damage done to the wrap.
[25]
Mr. Gary Lauryssen, a consultant of the plaintiff testified that
after the lapse of the written
lease agreement, he was still engaged
with Mr. Veerasamy in regard to the project. He testified that the
outstanding building plans
were an issue which he had raised with the
defendant. He testified that all the parties were aware of the
condition precedent and
in particular the 'cut off date.
[26]
Mr. Ayanda Ndinise led evidence on behalf of the defendant. He was
appointed the defendant's
Centre Manager with effect from 1 March
2016 at which time the advertising structure had been erected. He
testified that he arrived
when Mr. Veerasamy was away on leave and
could not be contacted. He testified that he only permitted access to
the property for
the installation of the advertising wrap which was
only being installed on a temporary basis. He testified further that
such access
and installation were only provided subject to the terms
and conditions previously stated by Mr. Veerasamy in his evidence. He
demanded that the advertising structure be removed from the
defendant's premises on 23 May 2016 as he believed it posed a threat
to the defendant's visitors, employees, incubates and in particular
to cars on the highway.
[27]
Mr. Ndinise confirmed that the defendant never received any rental
income from the advertising
structure and that no advertisements were
ever erected on the structure. He confirmed further that the
advertising structure was
an eyesore and caused much water damage to
the defendant's property.
[28]
Counsel for the defendant brought to the court's attention that
during February 2017 the plaintiff
brought an application to court
where it sought an order for final relief in the form of an action
for specific performance. The
plaintiff (applicant in the matter)
sought an order that the defendant (then respondent) performs in
terms of the written lease
agreement concluded between Mega Line and
the defendant and in particular co-operation complying with municipal
approval and providing
access to the defendant's property. The
applicant, which was not a party to the original lease agreement,
alleged that its rights
arise in terms of the sublease and subsequent
cession agreement concluded with Mega Line in respect of the
property. The application
was opposed by the defendant on the basis
that the written lease agreement never came into effect for the
reason that the condition
precedent was never fulfilled before the
'cut of’ date as prescribed ln the lease. The plaintiff
withdrew the application
and tendered the defendant's costs.
[29]
Counsel for the defendant further brought to the court's attention
that the deponent of the affidavit
in the application was Mr. Donald
McArthur who described himself in the founding affidavit as a
businessman and sole director of
the applicant. Mr. McArthur was not
called as a witness in the present matter.
Argument
[30] It is
trite that in trial proceedings the parties formulate their cases and
identify and
define in their pleadings the issues on which evidence
must be led.
[6]
A party must define its cause of action in its particulars of claim
so as to inform the defendant of the case it is required to
meet and
the relief sought against it.
[7]
[31]
I note that the plaintiffs cause of action and claims are premised on
the
condictio indebiti.
The
plaintiff does not allege in the particulars of claim, that any
agreement was reached with the defendant which was along the
lines of
the application proceedings and an agreement which substituted the
written lease agreement.
[32]
It is common cause that Mega Line failed to obtain the necessary
consent from the local
authority by 28 November 2014 as per the
written lease agreement. It is also common cause that Mega Line
failed to obtain written
confirmation that no such consent was
required from the local authority. Furthermore, the parties did not
agree to extend the time
period within which the condition precedent
was to be fulfilled. Accordingly, the written agreement never became
effective.
[33]
The plaintiff alleges that the error or mistake is excusable because
it had acted in the
bona fide
belief
that the written lease agreement existed and that the condition
precedent had been fulfilled and as such, the agreement had
become
effective. Furthermore, the plaintiff led no evidence regarding the
nature and extent of the defendant's enrichment.
[34]
According to Jacques Du Plessis, a professor of Private Law in the
book, The South African
Law of Unjustified Enrichment, says that
enrichment must be actual and not merely potential.
[8]
This means that the defendant's assets should actually have increased
or his liabilities should have decreased. The defendant was
not
enriched if he could potentially have enjoyed the benefits but it has
not been established that It did in fact do so. No evidence
was given
by the plaintiff of the extent of the enrichment.
[35]
I am of the view that the plaintiff may not rely on the error which
it claims was excusable.
The mistake must relate to a liability. From
the evidence on hand, I am of the view that the defendant received no
benefit whatsoever
in respect of the advertising structure and the
benefit enjoyed in respect of the advertising skin. On the contrary,
evidence was
led that the structure had caused water damage to the
defendant's property. Furthermore, in respect of Claim B, no
satisfactory
evidence was led that it had made payment in respect of
the invoices pertaining to the claim for the removal of the trees.
[36]
As stated above, counsel for the defendant brought to the court's
attention the application
for specific performance. It was also
brought to the court's attention that Mr. McArthur had been present
in the court during the
trial proceedings but was not called as a
witness. Counsel for the defendant requests the court to draw an
appropriate adverse
inference.
[37] The
plaintiff was at pains to avoid the application for specific
performance being brought
to the court's attention and in particular,
Mr. McArthur's affidavit being placed before the court. A casual
reading of the founding
affidavit indicates that he would have been
challenged on the various versions made under oath. The version in
the application
for specific performance was mutually inconsistent
with the evidence on hand and the pleadings. Accordingly, the court
draws an
adverse inference in the circumstances.
[38]
I am of the view that the plaintiff has failed to establish that
which it is required to
establish for the purpose of succeeding in
this action. As such, the following order is granted:
(i)
the plaintiffs action is dismissed with costs;
(ii)
the plaintiff shall also be liable for the costs associated with the
removal
of the advertising structure;
(iii)
the plaintiff shall be liable for damages, if any, done to the
defendant's property
in the removal of the advertising structure.
MOKOSE J
Judge
of the High Court of South Africa
Gauteng
Division, Pretoria
For
the Plaintiff:
Adv P
Lauw
instructed
by
David
Bayliss Attorneys
For
the Defendants:
Adv
GW Amm
instructed
by
Robin
Twaddle & Ass
Date
of Hearing:
24, 25 and
26 February 2020
Date
of Judgement:
28 April 2020
[1]
Buzzard Electrical (Pty) Ltd v 158 Jan Smuts
Ave Investments (Pty) Ltd 1996 (4) SA 19 (SCA)
[2]
Absa Bank Ltd v Leech 2001 (4) SA 132 (SCA)
[3]
1927 AD 554
at 556
[4]
Affirmative Portfolios CC v Transnet Ltd t/a Metrorail 2009 (1) SA
196 (SCA)
[5]
Africast (Pty) Ltd v Pangbourne Properties Ltd 2014 JDR 0616 (SCA)
[6]
BR Southwood: Essential Judicial Reasoning page 42
[7]
Harms, Amlers 9
th
edition Page 1
[8]
2012 edition page 31