About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: High Court, Northern Cape Division, Kimberley
SAFLII
>>
Databases
>>
South Africa: High Court, Northern Cape Division, Kimberley
>>
2019
>>
[2019] ZANCHC 25
|
|
Honeth N.O and Another v Matsapa Trading 778 CC (577/2014) [2019] ZANCHC 25 (17 May 2019)
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTHERN
CAPE HIGH COURT, KIMBERLEY)
CASE
NO.: 577/2014
Date
heard: 10-12-2018
Date
delivered: 17-05-2019
In
the matter between:
Bernt Robert Honeth
N.O
1
st
Plaintiff
Elizabeth Honeth N.O
2
nd
Plaintiff
And
Matsapa
Trading 778 CC
Defendant
CORAM:
WILLIAMS J:
JUDGMENT
WILLIAMS
J:
1.
Matsapa
Trading 778 CC, the applicant in this application for an amendment to
its plea, is the defendant in the main action between
the parties.
The respondents/plaintiffs are the trustees of the Valhalla Trust,
cited in their official capacities and who
shall be referred to
herein as “
the
Trust”.
2.
The Trust
instituted an action against the applicant for essentially the
payment of Value Added Tax (less transfer duty already
paid) on an
immovable property sale agreement (the agreement) entered into
between the parties during October 2012.
3.
The summons
was served on the applicant, whereafter it filed its plea during July
2014. On 19 June 2018 the applicant filed
a notice of intention
to amend its plea whereafter a notice of objection to the proposed
amendments was filed by the Trust on 3
July 2018.
4.
To place
this application in context it is necessary to reproduce the relevant
portions of the pleadings.
5.
Paragraphs
5 to 7 of the Trusts’ Particulars of Claim reads as follows:
“
5)
On or about 17 October 2012 and at Kimberley, the parties entered
into a written agreement of sale and
a copy of which is attached
hereto as Annexure “RH1”.
6)
When entering into the said agreement, the trust was duly represented
by Mr Van Tonder.
7)
The following were inter alia the express, alternatively tacit,
alternatively implied terms of
the said agreement:
7.1
The defendant purchases from the plaintiffs the immovable property
known as Erf 509, 4 Hemming Street, Belgravia,
Kimberley.
7.2
The purchase price is the sum of R1, 995,000.00 which amount does not
include Value Added Tax, if applicable
to the transaction.
7.3
The purchase price will be payable by way of a deposit in the amount
of R900,000.00 to be paid on the signing
of the agreement, and the
balance to be paid on registration of transfer of the property in the
name of the defendant.
7.4
Value added tax, if applicable to the transaction, will be payable,
together with the balance of the purchase
price, on registration of
transfer of the property.”
6.
In its plea
the applicant admitted paragraphs 5 and 6 of the Particulars of
Claim. With regard to paragraph 7 of the Particulars
of Claim
the following was pleaded:
“
Ad paragraph
7 and 7.1 thereof:
2.1
The contents of the paragraphs under reply are admitted.
2.2
Defendant pleads that the Afrikaans version of the written agreement
appended as “RH1” to the
Particulars of Claim constitutes
the whole agreement between the parties and no representations made
by any of the parties shall
be of any force or effect unless
contained in the agreement.
3.
Ad Paragraph 7.2 and 7.3 thereof:
The contents of the
paragraphs under reply are denied in so far as it does not correspond
with clause 1(a) and (b) of the agreement
(“RH1) between the
parties.
4.
Ad paragraph 7.4 thereof:
4.1
The contents of the paragraph under reply are
denied and
Plaintiffs are put to the proof thereof.
4.2
Defendant pleads that the parties expressly agreed that the Purchaser
– the Defendant – should
pay transfer Duty immediately
when requested to do so by the Conveyancer appointed by the Seller –
the Plaintiffs –
namely Haarhoffs Attorneys.
4.3
Defendant pleads further that the parties expressly agreed that the
Purchaser – Defendant – would
be in breach if it fails to
make any payment provided for in the agreement and/or fails to comply
with any obligation to SARS which
may delay the issue of a transfer
duty receipt, and remain in default for seven day after written
notice was given to remedy the
breach.”
7.
The
applicant’s Notice of Amendment deals with paragraphs 5 to 7 of
the Trust’s Particulars of Claim as follows:
“
2.
Ad
paragraphs 5 and 6
2.1
“The defendant admits that the parties, represented as alleged,
entered into the written agreement embodied
in Annexure RH1 on 17
October 2017 at Kimberley.
(The
date is obviously a typographical error)
2.2
The parties were under the impression that transfer duty was payable
and the written agreement was entered
into on that basis;
2.3
The words “welke bedrag BTW uitsluit (indien van toepassing)”
in clause 1 of the written agreement
(the impugned words) should
accordingly be treated as pro non scripto.
2.4
In the alternative,
and in the event of the court’s
finding that the impugned words –
a)
should not be treated pro non scripto, and
b)
must be interpreted to either expressly, tacitly or impliedly impose
a contractual obligation on
the defendant to pay VAT if VAT and not
transfer duty was payable
the defendant pleads
as follows:
2.5
the written agreement, owing to a bona fide mutual error in the
drafting of the document, did not correctly
reflect the common
continuing intention of the parties;
2.6
The common continuing intention of the parties, as it existed when
the written agreement was reduced to writing,
was that the defendant
would pay transfer duty over and above the purchase price;
2.7
it was not the common continuing intention of the parties that if VAT
and not transfer duty was payable, the
defendant would be responsible
for the payment of VAT;
2.8
The parties signed the written agreement in the bona fide but
mistaken belief that it recorded the true agreement
between the
parties;
2.9
By virtue of the foregoing, the defendant is entitled to
rectification of the written agreement, so as to
make it accord with
the parties’ common intention, by deleting the words “welke
bedrag BTW uitsluit (indien van toepassing);
2.10 The
defendant prays that the court adjudicates upon the basis of the
written agreement relied upon by the plaintiff as
it stands to be
corrected.
3.
Ad paragraph 7 (including 7.1 to 7.4)
4.1
The defendant repeats the averments in paragraphs 2.2 to 2.9 above
and –
a)
denies that it was an express – tacit or implied term of the
written agreement, as it stands
to be rectified, that VAT, if
applicable to transaction, will be payable together with the purchase
price on registration of transfer
of the property;
b)
denies in particular that it was an express – tacit or implied
term of the written agreement,
as it stand to be rectified, that VAT,
if applicable to transaction, will be payable by the defendant;
4.2
The balance of the allegations, to the extent that they are in
accordance with the express terms of the written
agreement, as it
stands to be rectified, are admitted.”
8.
The Trust
objects to the proposed amendments as contained in paragraphs 2.1,
2.2 and 2.3 of the Notice of Amendment on the basis:
(a) that it
constitutes a withdrawal of an admission which would not be allowed
without sufficient and proper explanation thereof;
(b) that the
proposed amendments contained in paragraphs 2.1, 2.2 and 2.3 of the
Notice of Amendment clearly intend to contradict,
vary or alter the
terms of the written agreement in violation of the parol evidence
rule; and (c) that paragraphs 2.1 to 2.3 of
the proposed amended plea
therefore do not sustain a defence and would render the plea
excipiable.
9.
As can be
seen the proposed amendments have as its aim the deletion of the
words ‘
welke
bedrag BTW uitsluit (indien van toepassing)”
from the written agreement either by regarding it as
pro
non scripto
or by rectification. Clause 1 of the agreement reads as
follows:
“
1.
DIE KOOPPRYS IS
R 1995 000, 00
Welke bedrag BTW
uitsluit (indien van toepassing),
En as volg betaalbaar
is:
(a)
kontant
by aanvaarding van hierdie aanbod
R900 000,00
Welke bedrag by the
Transportbesorger in trust inbetaal sal word, wie die voormelde
bedrag onmiddelik daarna sal belê in ‘n
rentedraende
rekening tot voordeel van die Koper.
(b)
Die
balans van
R1 095 000,00
Sal vry van
bankkommissie in kontant betaalbaar wees te Kimberley teen
registrasie van oordrag in die naam van die Koper en moet
deur
Bankiers-of ander
goedgekeurde waarborg/e ten gunste van sodanige person/persone
verseker word as wat die Verkoper mag bepaal en
sodanige waarborg/e
moet binne
30 Kalenderdae van
aanvaarding van hierdie aanbod aan die Verkoper se Aktebesorger
gelewer word.”
(own
highlighting)
10.
Mr Wian
Steynberg, who is a member of the applicant and the deponent to the
affidavit in support of the application for amendment,
explains the
reasons for the amendments as follows:
10.1 The immovable
property was listed for sale at the price of R2.2 million;
10.2 The offer made
by the applicant in the amount of R1995 000, 00 was, together
with transfer costs and transfer duty,
the absolute maximum that the
applicant was willing and able to pay;
10.3 The
possibility that VAT would be payable on the transaction was never
discussed by the parties, much less that the applicant
would be
liable to pay VAT on the purchase price should it happen to be so
payable;
10.4 Both parties
were under the impression that transfer duty and not VAT was payable
on the transfer of the property.
To this effect the appointed
conveyancing attorneys, Haarhoffs, called upon the applicant to pay
transfer duty in the amount of
R76 000, 00, which it in fact
did.
10.5 It only
emerged six months after registration of the transfer of the property
into the applicant’s name that VAT
and not transfer duty was
payable on the purchase price.
10.6 The applicant
had been of the view that the core issue on the pleadings between the
parties was whether it was an implied
term of the agreement that if
VAT was payable on the transaction the applicant would be responsible
for payment thereof.
10.7 After the
matter passed through several counsel, applicant’s current
counsel held the view that the words “
welke bedrag BTW
uitsluit (indien van toepassing)”
could not simply be
ignored but that the court must be asked to either consider the
impugned words as pro non scripto or to adjudicate
the matter upon
the basis of the written agreement as it stand to be corrected; and
10.8
The
intended amendment to the plea is simply to bring the written terms
of the sale agreement in conformity with the true intention
of the
parties.
11.
I deal
first with the Trust’s contention that paragraphs 2.1 to 2.3 of
the proposed amendment constitutes a withdrawal of
an admission which
is not sufficiently explained.
As a starting point it
must be noted that a withdrawal of an admission is not in a different
position from an ordinary amendment.
The court’s powers
are limited only by considerations of prejudice and injustice to the
aggrieved party to the extent that
a special order as to costs will
not compensate him. In
President-Versekeringsmaatskappy Bpk
v Moodley
1964(4) SA 109 (TPD) at 110H – 111A the following
is said:
“
The approach is
the same, but the withdrawal of an admission is usually more
difficult to achieve because (i) it involves a change
of front which
requires full explanation to convince the Court of the bona fides
thereof, and (ii) it is more likely to prejudice
the other party, who
had by the admission been led to believe that he need not prove the
relevant fact and might, for that reason,
have omitted to gather the
necessary evidence.”
12.
Neither the
bona
fides
of
the applicant in seeking the amendment or any prejudice resulting
therefrom have been seriously argued by Mr Van Niekerk SC for
the
Trust – and with good reason. The proceedings are still
in its early stages and no great disruption would be caused
by such
an amendment. The withdrawal of the admission that the
Afrikaans version of the written agreement “
constitutes
the whole agreement between the parties and no representations made
by any of the parties shall be of any force or effect
unless
contained in the agreement”
can
also hardly come as a surprise to the Trust. In the plea as it
stands the applicant has denied the assertion made by the
Trust in
paragraph 7.4 of the Particulars of Claim and has specifically
pleaded that the parties agreed that transfer duty be paid
by the
applicant (as opposed to VAT).
13.
Similarly
in its plea to the Trust’s paragraph 11 of the Particulars of
Claim where it is stated that “
The
plaintiffs aver that in law and in accordance with the contractual
terms the defendant was obliged to pay Value Added Tax in
respect of
the transaction as pleaded hereinbefore”
,
the applicant has pleaded as follows: “
The
contents of the paragraph under reply are denied. . . . . The
agreement between the parties does not provide for the payment
of VAT
by the defendant to the plaintiffs. The agreement expressly
provides for the payment of transfer duty and further
that the
defendant would be in breach if it fails to comply with any
obligation to SARS which may delay the issue of transfer duty
receipts.”
14.
The
explanation for the withdrawal of the admission cannot in these
circumstances be said to be insufficient where it appears to
be for
the purpose of aligning the plea with the real issues in dispute
between the parties. In
Whittacker
v Roos
;
Morant v
Roos
1911 TPD 1092
at 1102 – 1103; Wessels J remarked:
“
This court has
the greatest latitude in granting amendments, and it is very
necessary that it should have. The object of the
Court is to do
justice between the parties. It is not a game we are playing,
in which, if some mistake is made, the forfeit
is claimed. We
are here for the purpose of seeing that we have a true account of
what actually took place, and we are not
going to give a decision
upon what we know to be wrong facts. It is presumed that when a
defendant pleads to a declaration
he knows what he is doing, and
that, when there is a certain allegation in the declaration, he knows
that he ought to deny it,
and that, if he does not do so, he is taken
to admit it.
But
we all know, at the same time, that mistakes are made in pleadings,
and it would be a very grave injustice, if for a slip of
the pen, or
error of judgment, or the misreading of a paragraph in pleadings by
counsel, litigants were to be mulcted in heavy
costs. That
would be a gross scandal. Therefore, the Court will not look to
technicalities, but will see what the real
position
is between the parties.”
(Own highlighting)
15.
In my view
the real mischief is not that the amendment constitutes the
withdrawal of an admission but rather the effect of the inclusion
of
paragraphs, 2.2 and 2.3 of the Notice of Amendment on the
proceedings. At this stage it must be mentioned that paragraph
2.1 on its own is not objectionable in view of my findings herein and
there is no reason why such amendment cannot be granted.
16.
What is
envisaged with the amendments contained in paragraphs 2.2 and 2.3
(read with 2.4) is that the court is called upon to first
decide
whether the impugned words referred to should be treated as
pro
non scripto
,
and only thereafter in the event of this defence failing, that
rectification be considered.
17.
The Trust
has no objection to the proposed amendments relating to rectification
of the written contract. The approach by the
applicant,
however, would inevitably entail the reception of extrinsic evidence
to prove the true version of the contract as alleged
by the
applicant, while the contract stands unrectified – an approach
which is contrary to the parol evidence rule.
18.
Intrinsic
to the parol evidence rule is the rule that aside from claims for
rectification of a contract, no evidence may be given
to alter the
clear and unambiguous meaning of a contract. While it has been
held that evidence may be admissible to establish
the context or
factual matrix of a contract – which must be used as sparingly
as possible, the parol evidence rule remains
part of our law.
See
KPMG
Chartered Accountants (SA) v Securefin Ltd and Another
2009(4)
SA 399 at 409 G-J where Harms DP said the following:
“
[39]
First, the integration (or parol evidence) rule remains part of our
law
.
However,
it is frequently ignored by practitioners and seldom enforced by
trial courts. If a document was intended to provide a
complete
memorial of a jural act, extrinsic evidence may not contradict, add
to or modify its meaning (
Johnson
v Leal
1980 (3) SA 927
(A) at 943B).
Second,
interpretation is a matter of law and not of fact and, accordingly,
interpretation is a matter for the court and not for
witnesses (or,
as said in common-law jurisprudence, it is not a jury question: Hodge
M Malek (ed)
Phipson
on Evidence (16 ed 2005) para 33-64
).
Third, the rules about admissibility of evidence in this regard do
not depend on the nature of the document, whether statute,
contract
or patent (
Johnson
& Johnson (Pty) Ltd v Kimberly-Clark Corp
[1985] ZASCA 132
(at
www.saflii.org.za
),
1985 Burrell Patent Cases 126 (A)).
Fourth,
to the extent that evidence may be admissible to contextualise the
document (since ‘context is everything’)
to establish its
factual matrix or purpose or for purposes of identification, ‘one
must use it as conservatively as possible’
(
Delmas
Milling Co Ltd v du Plessis
1955
(3) SA 447
(A) at 455B-C).”
See also
Sakhiwo
Health Solutions (Limpopo) (Pty) Ltd v MEC Health, (Limpopo)
Provincial Government
[2015] JOL 33718
(SCA)
at paragraph 32
thereof.
19.
It follows
thus that to allow the amendments sought in paragraphs 2.2 and 2.3 of
the Notice of Amendment would render the plea excipiable.
These
amendments can therefore not be allowed.
20.
Consequent
upon the amendments contained in paragraphs 2.2 and 2.3 being
refused, paragraph 2.4 of the notice of amendment will
become
superfluous if not non-sensical. Although the objection was not
aimed towards paragraph 2.4 it makes no sense to allow
this amendment
and it is consequently also refused.
21.
The Trust’s
opposition to the proposed amendments being mainly successful there
is no reason why costs should not follow the
result.
The
following order is made:
a)
Save
for the amendments contained in paragraphs 2.2, 2.3 and 2.4 of the
Notice of Intention to Amend, dated 12 June 2018, which
are not
allowed, the proposed amendments are granted.
b)
The
applicant is ordered to pay the costs of the application.
CC
WILLIAMS
JUDGE
For
Applicant:
Adv WA Van Aswegen
Duncan & Rothman Inc
For
Respondents: Adv JG Van Niekerk SC
Haarhoffs Inc