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[2018] ZAGPPHC 727
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Coachmans Steak Ranch (Pty) Limited and Another v SA Retail Properties (Pty) Limited and Another (57062/16) [2018] ZAGPPHC 727 (9 March 2018)
IN THE HIGH
COURT OF SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
(1)
NOT REPORTABLE
(2)
NOT OF INTEREST TO OTHER
JUDGES
CASE
NO: 57062/16
9/3/2018
In
the matter between:
COACHMANS
STEAK RANCH (PTY) LIMITED
First
Applicant
NICOLA
ENGLEZAKIS
Second
Applicant
and
SA
RETAIL PROPERTIES (PTY)
LIMITED
First
Respondent
SHERIFF
OF THE HIGH COURT SANDTON NORTH
Second
Respondent
JUDGMENT
Tuchten
J:
1 The
applicants apply urgently to set aside warrants of attachment and
eviction taken out under the present case number. The case turns on
the interpretation of a settlement agreement concluded between
the
applicants and the first respondent which was made an order of court
by Prinsloo J.
2 The
first respondent (SA Retail) issued summons against the applicants
under the present case number on 22 July 2016. In its summons, SA
Retail alleged that it had leased premises in Sandton to the
first
applicant (Coachmans). Coachmans conducted a restaurant business from
the premises. The second applicant stood surety for
the obligations
of Coachmans to SA Retail.
3 The
particulars of claim to the summons alleged that the Coachmans
had to
pay monthly amounts under the lease in respect of a basic rental,
operating costs, insurance charges, rates and taxes and
refuse
charges. The particulars of claim further alleged that as at 1 July
2016, the applicants owed SA Retail R1 0121 760 and
that because this
sum was not paid, SA Retail had elected to cancel the lease.
4 SA
Retail went on to allege that it would suffer damages if Coachmans
by
refusing to vacate made it impossible to re-let the premises.
5 SA
Retail claimed in its summons payment of R1 0121 760 with interest
and eviction. It asked that its claim for damages be postponed until
it was able to quantify it, It also claimed attorney and client
costs. The lease made provision for this scale of costs.
6 The
applicants defended the action. SA Retail applied for summary
judgment. The parties then concluded an agreement, which they styled
"DEED OF SETTLEMENT, ACKNOWLEDGEMENTOF DEBT, AND COURT
ORDER"
on 1 June 2017. The settlement agreement was made an order of court
on 6 June 2017.
7 The
settlement agreement recorded in clause 2 that the first respondent
contended that the applicants were indebted to it in the sum of R2
187 548, calculated in accordance with a schedule attached to
the
settlement agreement. Clause 3 read with clause 4 provided that the
applicants could if they wished provide the first respondent
with
their calculation of the "arrears due and owing". If they
did not do this within 30 days, the quantum owing would
be as SA
Retail asserted in clause 2.
8 The
applicants did not challenge SA Retail's asserted quantum,
which then
became binding.
9 Clause
5 proceeded to require the applicants to pay certain amounts
to SA
Retail. The clause is not well drafted. It reads:
In the interim period, the
[applicants ...] undertake to effect payment of the following
amounts, in liquidation of [Coachman's]
indebtedness to SA Retail],
and payment of future rental on due date.
10 The
clause then sets out six amounts, each of R200 000, to be paid from
31 May
2017 first on 31 May and then on 7 June 2017 and thereafter
from 1 July to 1 October 2017.
11 Clause
6 provided that if "anyone payment" was not made on due
date, SA Retail would be obliged to inform the applicants' attorney
by email that payment must be made within seven days. If payment
were
then not made, SA Retail would
... be entitled to proceed
forthwith with the warrant of eviction and warrant of attachment for
any amount then due and outstanding.
12 Coachmans
then paid the six amounts listed in clause 5. They paid them late
but
I do not think this matters. They were paid electronically. They were
accepted without protest and retained. In respect of
the late
payments of some or all of the six amounts, SA Retail either waived
its rights to evict and execute or agreed to amend
the due dates for
payment to accommodate the lateness.
13 However,
after it had received the six listed amounts, SA Retail began to
exert commercial pressure on the applicants to pay the balance owed
to it. This balance included monthly rental due in respect
of
Coachmans' occupation of the premises. There was much correspondence
but I need not refer to it. Suffice it to say, on 19 January
2018, SA
Retail, through its attorney, sent a demand to the applicants'
attorney in which the applicants were informed that the
January
rental had not been paid and giving notice that if payment were not
made within seven days, SA Retail would be entitled
to proceed
forthwith with "the warrant of eviction."
14 The
warrants of eviction and attachment which SA Retail proceeded to have
executed were dated 8 August and taken but on 18 August 2017. They
were taken out when the applicants were late with one of the
six
payments but then not executed until 27 February 2018. The result of
the execution of the warrants was that Coachmans could
no longer
trade. I ruled that the matter was urgent and argument proceeded on
the merits of the dispute.
15 The
essence of the dispute between the parties is this: the applicants
contend
that the entitlement to execute conferred by clause 6
extended only to a failure to pay the six listed amounts; SA Retail,
on the
other hand, argues that the entitlement to execute extended
also to a failure to pay rental due and outstanding.
16 The
relevant provisions of the deed of settlement are not easy to
interpret.
As was so trenchantly observed in
Potgieter
v Olivier and Another,
[1]
the Supreme Court of Appeal in
Natal
Joint Municipal Pension Fund v Endumeni Municipality
[2]
provided an exposition of the principles of interpretation. It is a
unitary exercise that requires the consideration of text, context
and
purpose.
17 The
context is that when SA Retail issued summons , the applicants owed
it a large sum of money. By the time the application for summary
judgment was settled, the sum had doubled. SA Retail wanted to
keep
Coachmans on as its tenant but also to get paid what it was owed and
to put commercial pressure on the applicants to pay on
due date what
they owed. Coachmans wanted to keep on trading from the premises.
There is considerable goodwill to a restauranteur
in the premises in
which she trades. These were the purposes for which the parties
entered into the settlement agreement.
18 By
June 2017, the applicants had given SA Retail something of a run
around.
SA Retail manifestly wanted to limit the applicants' ability
to use the delays which attend the enforcement of commercial rights
through the courts by obtaining rights to enforce its claims which
eliminated the applicants' capacity to delay the day of reckoning.
To
achieve this, SA Retail did not agree to reinstate the lease but to
defer the enforcement of its right to evict and execute
provided the
applicants paid substantial amounts on account of their overdue
indebtedness.
19 it
is quite unclear what the parties meant by "the interim period".
It could be the interregnum which would arise if the applicants
challenged the quantum of their indebtedness under clauses 3 and
4.
However, there is no indication in the settlement agreement that this
interregnum would end before, on or after the due date
of the last
listed payment. Furthermore, there is no indication of a regime which
would begin to operate after the conclusion of
the interim period.
20 The
settlement agreement further does not expressly provide for the
amounts of
future rentals which would become due. There are however
the allegations in the particulars of claim and more importantly in
the
schedule to the settlement agreement, from which one could
determine retrospectively what the rentals had been. There is the
added
complication that the summons refers to a component for "basic
rental" and then components for operating costs rates and
taxes
and the like. But the settlement agreement refers only to "rental"
without quantifying or defining it. To compound
the uncertainty,
there is no claim in the summons for the very substantial electricity
charges for which the applicants by their
failure to raise a
challenge under clauses 3 and 4 accepted liability.
21 Giving
all these difficulties due weight, I nevertheless conclude that the
interpretation
of SA Retail is to be preferred. It wanted to be able
to enforce its claims for future rental without being delayed by
precisely
the kind of procedural challenge that the applicants have
mounted in the present case. This was not a consideration which the
applicants
would have been commercially able to deny SA Retail. I
find that "anyone payment" in clause 6 includes a payment
in respect
of "future rental on due date" in clause 5.
22 As
SA Retail gave the notice contemplated in clause 6 in respect of the
January rental which was due and unpaid, the jurisdictional
prerequisite to the exercise of the right to take out warrants was
satisfied. SA Retail was then entitled both to evict and to execute
for "any amount then due and outstanding". The applicants
do not challenge the amount for which SA Retail in its warrant of
execution seeks to execute in that regard.
23 The
application must accordingly fail. In clause 7 of the settlement
agreement,
the applicants agree to pay costs on an attorney and
client scale for "any further costs incurred in the event of
breach hereof
'. I can find no reason to deprive SA Retail of the
benefit of this provision.
24 I
make the following order:
1
The
application is dismissed.
2
The
applicants, jointly and severally, must pay the first respondent's
costs in the application on the scale as between attorney
and client.
NB Tuchten
Judge
of the High Court
9 March 2018
[1]
2016 6 SA 272
GP para 30
[2]
2012 4 SA 593
SCA