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[2018] ZAGPJHC 638
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Eiser v Zuma and Others (28178/2017) [2018] ZAGPJHC 638 (31 October 2018)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO:
28178/2017
In
the matter between:
EISER,
LEONARD
WAYNE
Applicant
and
ZUMA,
SHEREEN
First
Respondent
JAWITZ
PROPERTIES
Second
Respondent
FAURIE
NELL
INC
Third
Respondent
J U D G M E N T (Leave to
appeal)
MAIER-FRAWLEY
AJ:
1.
The
applicant seeks leave to appeal against the whole of the judgment and
order which I granted on 15 August 2018 wherein I dismissed
the main
application as instituted by the applicant, with costs.
[1]
The application for leave to appeal is opposed by the first
respondent
.
2.
In this matter I gave full and detailed
reasons for judgment. I have reconsidered my judgment in the light of
the application for
leave to appeal and I do not consider that there
exists any reasonable prospect that another court would uphold the
complaints
raised by the applicant, for reasons which follow.
3.
Section
17(1)
of
the
Superior
Courts Act 10 of 2013
,
inter
alia
,
provides as follows:
“
(1)
Leave to appeal may only be given where the judge or judges concerned
are of the opinion that -
(a)
(i) the appeal would have a reasonable
prospect of success; or
(ii) there is some other
compelling reason why the appeal should be heard, including
conflicting judgments on the matter under consideration;
(b)
…”
4.
The
use of the word ‘would’ in
section 17
(1)(a)(i) of the
Superior Courts has been held to denote ‘
a
measure of certainty that another court will differ from the court
whose judgment is sought to be appealed against.’
[2]
Such
approach has been held to
be
correct in this division in the matter of
Acting
National Director of Public Prosecutions and Others v Democratic
Alliance, In Re: Democratic Alliance v Acting National
Director of
Public Prosecutions and Others.
[3]
To
this may be added, certain cautionary notes sounded by the Supreme
Court of Appeal in dealing with appeals: In
S
v Smith
,
[4]
it was stated that in deciding whether there is a reasonable prospect
of success on appeal, there must be ‘a sound, rational
basis
for the conclusion that there are prospects of success on appeal.’
In
Dexgroup
(Pty) Ltd v Trusco Group,
[5]
the
SCA cautioned that the ‘need to obtain leave to appeal is a
valuable tool in ensuring that scarce judicial resources are
not
spent on appeals that lack merit.’
5.
I do not intend to deal
ad
seriatum
with the grounds of appeal
as set out in the notice of appeal
,
as they contain a measure of
overlapping, but briefly deal with them as set out below.
6.
The main
ground of appeal is directed against the court’s interpretation
of clause 2 of the sale agreement, as dealt with
in the judgment. The
interpretation contended for on behalf of the applicant in the main
application, was held to be insensible,
not only by reason of the
fact that it went against a commercially sensible construction but
more particularly, because it undermined
the accepted purpose of the
clause,
[6]
which was set out in
paragraph 40 of the judgment.
7.
The
gravamen of the applicant’s complaint is that the
interpretation accepted in the judgment fails to give effect ‘to
the express wording in clause 2 of the agreement, which states in
unequivocal terms that the condition relating to the mortgage
bond is
[deemed to be] fulfilled on the
issue
by the financial institution of an offer upon terms the financial
institution imposes’,
[7]
and that if an offer of loan was made by the financial institution
for an amount of less than R2 million, only such amount required
acceptance by the first respondent (as buyer), but not the remaining
terms of such offer.
8.
The basis for the complaint appears from ground 3, where the
applicant contends that ‘if the mortgage bond was granted
in
the amount of R2 million the word ‘acceptable to the purchaser’
would cease to have any application, and the purchaser
who
receives
a mortgage bond
for the amount stipulated would be bound by the
terms imposed by the financial institution, but not the purchaser
[who] agrees
to accept a lesser amount…’ (own emphasis).
9.
In the first instance, this was not the case which the applicant
brought before court. The issue which the court was called upon
to
determine was whether or not the suspensive condition contained in
clause 2 had been fulfilled in circumstances where an offer
of loan
in an amount of R1.2 million was made by Absa Bank, which required
acceptance by the first respondent under the provisions
of clause 2
of the agreement.
10.
The argument on which ground 3 is based in any event does not assist
the applicant. It loses sight of the commercial reality
that
underpins the basis for the obtaining of a bond, as mentioned,
inter
alia
, in paragraph 38 of the judgment. In order to receive or
obtain a loan, as was the underlying object, the buyer (first
respondent)
would have to have knowledge of any offer made by a
lending institution in order to accept its quote on the terms
offered, without
which she would not obtain a bond. When regard is
had to the purpose of the clause, namely, to protect the first
respondent against
the purchase of a property without having secured
appropriate and acceptable financial means form a lending
institution, obtaining
of a bond by means of an acceptance of an
offer of loan on the terms offered, directly impacted the purchaser’s
ability to
make payment of the purchase price under the sale
agreement, as further pointed out in paragraph 42 of the judgment. As
such, the
argument is of no assistance to the applicant.
11.
The fourth ground mentioned in the appeal, namely, that the court
failed to give effect to the deeming provision in the last
sentence
of clause 2 which ‘excludes any interpretation of clause 2
which requires acceptance of the interest rates and other
terms
offered where a lesser amount is offered than appears in clause 2’
fails to take into consideration what is stated
in paragraphs 36 and
37 of the judgment, read together with footnotes thereto,
particularly, footnote 38.
12.
Ground 5
[8]
appears to be based upon a misconstruction of the basis on which the
evidence of Ms Joubert was evaluated and accepted. Firstly,
she
tendered factual evidence of what actually transpired regarding the
bond that was sought to be obtained, which belied the applicant’s
averments in the founding affidavit. She was called by the applicant,
and tendered evidence on his behalf at the hearing. Her evidence
had
a bearing on whether or not the offer was accepted by the first
respondent on 21 January 2015 (as averred in the founding affidavit
)
as well as the date on which the first respondent first obtained
knowledge of the subsequent offer dated 29 January 2015. Secondly,
Ms
Joubert was not asked to interpret clause 2 during her testimony and
even her evidence to the effect that the interest rate
had to be
acceptable to the buyer (as mentioned in paragraph 31 of the
judgment) remained of a factual nature. As pointed out in
footnote 38
on page 14 of the judgment, Ms Joubert’s undisputed evidence
constituted proof of the actual facts, which were
contrary to the
deemed facts, and served to effectively rebut the fictional state of
affairs that underpinned the deeming provision.
13.
Reference was made to the case of Boom v The American Swiss Watch Co
1915 AD 100
at 107 in support of the general principle mentioned in
paragraph 37 of the judgment. In ground 7 of the application for
leave
to appeal, the applicant contends that
Bloom
is
distinguishable on the facts of the matter
in casu
, since the
Absa offer ‘was not required to bring into existence a contract
between the first respondent and the financial
institution, but a
contract between the first respondent and the applicant.’ The
ground appears to be based upon a misunderstanding
of what was sought
to be conveyed in paragraph 37 of the judgment, as read in context
with the remainder of the judgment, and as
further elucidated in
paragraph 10 above. During oral argument presented at the hearing of
the application for leave to appeal,
the applicant’s counsel
contended that clause 2 did not require that a contract had to be
concluded between the financial
institution and the purchaser –
it simply required finance to be available to the purchaser. This
argument misses the point.
Finance would only have become available
to the purchaser upon acceptance by the buyer of the terms proposed
by the financial institution.
And that in turn would have required
knowledge on the part of the buyer of both the existence of the offer
of loan and the terms
on which it was based.
14.
As pointed
out by the first respondent’s counsel in written and oral
argument tendered at the hearing of the matter, if clause
2 merely
required that a loan had to be offered or that a facility had to be
in place in order for the suspensive condition to
be fulfilled, it
begs the question as to why the condition was not considered to have
been fulfilled when a facility was first
offered on 2 January 2015 in
the amount of R1.2 million, (referred to in paragraph 13 of the
judgment).
[9]
The argument is
not without force. It bears mentioning that in the replying
affidavit, the applicant contended that the issuing
of the offer of
loan on 29 January 2015 had the result of fulfilling the suspensive
condition, this version being in stark contrast
to the case alleged
in the founding papers that the offer had been accepted by the first
respondent on 21 January 2015 as was required
under the provisions of
clause 2. In a similar vein, in the application for leave to appeal
it was contended on behalf of the applicant
that the clause was clear
and unambiguous, permitting of no interpretation, whereas in the main
application, an interpretation
was proffered, which was however
rejected by the court as insensible by application of principles
relating to the interpretation
of contract, as dealt with extensively
in the judgment.
15.
For all the reasons given above, the application for leave to appeal
is refused.
16.
I accordingly make the following order:
16.1. The application for
leave to appeal is dismissed with costs.
__________________________
MAIER-FRAWLEY
AJ
Date
of hearing:
23 October 2018
Judgment
delivered
31 October 2018
APPEARANCES:
Counsel
for Applicant:
Adv. R.J Stevenson
Attorneys
for Applicant
Eiser & Kantor Attorneys (ref: Mr. Eiser)
Counsel
for First Respondent:
Adv. W. Wannenburg
Attorneys
for First Respondent:
Moodley Attorneys (ref: Mr. G. Moodley
[1]
The first respondent’s counter-application was upheld to the
extent set out in the judgment.
[2]
The
Mont Chevaux Trust (IT 2012/28) and Tina Goosen and 18 Others
Case No. LCC 14R/2004, at para [6]
[3]
(19577/09)
[2016) ZAGPPHC
489
(24 June 2016) para [25], a decision of the Full Court, which is
binding upon me.
[4]
2012 (1) SACR 567
(SCA) para 7.
[5]
[2013] ZASCA 120
(20 September 2013).
[6]
In
this regard, See:
Bothma-Batho
Transport (Edms) Bpk v S Bothma & Seun Transport (Edms) Bpk
2014
(2) SA 494 (SCA), para 12, where Wallis JA stated as follows:
‘
Whilst
the starting point remains the words of the document, which are the
only relevant medium through which the parties have
expressed their
contractual intentions, the process of interpretation does not stop
at a perceived literal meaning of those words,
but considers them in
the light of all relevant and admissible context, including the
circumstances in
which
the document came into being. The former distinction between
permissible background and surrounding circumstances, never
very
clear,
has
fallen away. Interpretation is no longer a process that occurs in
stages but is ‘essentially one unitary exercise’.
[Per
Lord Clarke SCJ in Rainy Sky SA & others v Kookmin Bank
[2011]
UKSC 50
([2012]
Lloyds Rep 34 (SC)) para 21.] Wallis JA further pointed out that
Lord Clarke SCJ relied also on the following passage
in Society of
Lloyd’s v Robinson
[1999]
1 All ER (Comm) 545
,
551:
‘
Loyalty
to the text of a commercial contract, instrument, or document read
in its contextual setting is the paramount principle
of
interpretation. But in the process of interpreting the meaning of
the language of a commercial document the court ought generally
to
favour a commercially sensible construction. The reason for this
approach is that a commercial construction is likely to give
effect
to the intention of the parties. Words ought therefore to be
interpreted in the way in which a reasonable commercial person
would
construe them. And the reasonable commercial person can safely be
assumed to be unimpressed with technical interpretations
and undue
emphasis on niceties of language
’
.
.
.
[7]
Grounds 1 and 2, in the application for leave to appeal.
[8]
In ground 5 of the application for leave to appeal, the applicant
criticises the court for relying on an interpretation allegedly
given by Ms Joubert who tendered oral evidence at the hearing of the
main application on behalf of the applicant.
[9]
The argument was set out as follows in paras 3 & 4 of the first
respondent’s heads of argument: “
If
the applicant honestly believed that the interest rate and terms and
conditions of the approval of the home loan was not a
requirement as
per the agreement concluded, then the question beckons, on the
common cause facts, why was the suspensive condition
not considered
to have been fulfilled on 2 January 2015 when her home loan for the
exactly the same amount of R1 200 000.00
was granted? The
reason is, simply, that the applicant knew that the interest rate
and the terms and conditions had to be acceptable
to the first
respondent should a lesser amount be offered, which negates against
an interpretation now preferred by the applicant.
”