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[2018] ZAGPJHC 629
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Tirhani Capital (Pty) Limited v Jetmaster (Pty) Limited (2016/21032) [2018] ZAGPJHC 629 (16 November 2018)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NUMBER: 2016/21032
In
the matter between:
TIRHANI
CAPITAL (PTY) LIMITED
Applicant
and
JETMASTER
(PTY) LIMITED
Respondent
Coram:
Lagrange
AJ
Heard
:
12 November 2018
Delivered
:
16 November 2018
JUDGMENT
LAGRANGE,
J
Introduction
[1]
The excipient (‘Jetmaster’) has raised various exceptions
to the particulars of claim of the plaintiff (‘Tirhani’)
on the basis that the particulars are either vague and embarrassing
or do not disclose a cause of action.
Background:
[2]
In November 2014, a supply agreement for the provision of insulation
tiles for cooking stoves was entered into between Giflo
Engineering
trading as Excalibur and Retrolex in terms of which the latter would
provide the former with insulation tiles over
a two-year period.
[3]
Clause 16 of the agreement provided that neither party could cede any
rights or obligations it had in terms of the supply agreement
to any
third party without the prior written consent of the other, which
would not be unreasonably withheld or delayed. In passing,
it would
seem on the face of the wording of the clause it would seem that the
both cession and assignment were intended to be covered
by the
clause.
[4]
Further, clause 17 of the agreement specifically entitled Excalibur
to assign any of its rights or obligations under the agreement
to any
of its subsidiaries but subject to the prior written consent of
Retrolex. Neither party had the right of deduction or setoff.
This
clause did not refer to a cession of rights but also seems to have
contemplated that.
[5]
Tirhani claims that in April 2015 Excalibur assigned and delegated
its rights and obligations in the written agreement to Jetmaster
and
Tirhani claims that Retrolex consented or alternatively waived its
written consent thereto and that Retrolex continued to perform
its
obligations to Jetmaster under the agreement.
[6]
In May 2015, Tirhani alleges that it concluded a cession and
assignment agreement with Retrolex in terms of which it acquired
all
the rights and obligations of Retrolex under the supply agreement.
Moreover, it claims Jetmaster gave written consent thereto.
Tirhani
alleges it continued to fulfill Retrolex’s obligations under
the agreement.
[7]
Tirhani asserts that from November 2015 Jetmaster failed to place
minimum monthly orders as required by clause 5.2 of the supply
agreement.
[8]
On 13 January 2016, Tirhani purportedly issued a notice of breach,
apparently under clause 14.1 of the agreement, calling upon
Jetmaster
to rectify alleged breaches of clauses 5.2 and 5.4 of the agreement
within seven days. The letter was addressed
to a certain
Reinhard Vollmer.
[9]
In a letter responding to the letter from Tirhani, Argent Industrial
(‘Argent’) dated 29 January 2016, Argent denied
entering
into any form of agreement with Tirhani and contended that ‘by
extrapolation’ neither had Jetmaster.
[10]
On 10 May 2016 Tirhani claimed that Argent’s response
constituted a repudiation of the supply agreement, which Tirhani
accepted and claimed damages in excess of R5 million.
[11]
Tirhani then issued summons and claimed general damages in the form
of lost income from sales and special damages for machinery
and plant
modification and the engagement of labour and personnel, which it
claims was specifically contemplated it would have
to acquire in
order to fulfil its obligations under the supply agreement.
[12]
In the alternative, Tirhani claims that an oral agreement was entered
into between the Tirhani and Jetmaster in or about June
2015, the
terms of which were confirmed in an email dated 2 July 2015 from one
Ian Dangers writing from a ‘Jetmaster/Argent’
email
address. Tirhani claims that defendant failed to place the minimum
monthly order, which should have been placed in line with
the written
agreement and that the notice of breach issued in January 2016 served
as notice of breach of the oral agreement as
well as the written
supply agreement. Similarly, the letter of repudiation of 10 May 2016
served as notice of repudiation of the
oral agreement too. Under the
alternative claim, Tirhani claims approximately R3.433 million for
the loss of sales.
Exceptions:
[13]
The defendant has raised a number of exceptions, all of which relate
to whether or not Tirhani’s particulars of claim
lack the
necessary averments to sustain its causes of action.
First
exception:
[14]
In claiming that Excalibur assigned and delegated its obligations to
the Jetmaster in April 2015, plaintiff fails to allege
that Retrolex
gave its
written
consent to the alleged cession. Moreover it failed to allege that it
waived its consent in writing to the substitution of Excalibur
by the
defendant as required by clause 22 of the supply agreement in terms
of which
‘no amendment, waiver or representation
shall have any validity or effect unless it is reduced to writing and
signed
by both parties.’
[15]
I agree that in the absence of pleading that Retrolex consented in
writing under the provisions of clause 17, or orally, or
on some
other basis, the respondent cannot be sure what form of consent is
being alleged and how it should plead thereto. Further
insofar as the
plaintiff alleges that it waived the requirement of written consent
under clause 17 it fails to plead whether such
waiver was in
compliance with clause 22, or whether the requirement of written
consent was waived on some other basis notwithstanding
the provisions
of clause 22. It is true that by stating that consent was
granted or that the requirements of written consent
were waived, does
disclose a critical part of the cause of action, but does it not
assist the defendant in knowing the basis on
which it is alleged
consent was granted or the requirement of written consent was waived
if it was not granted in writing.
[16]
In circumstances where the primary cause of action is based on a
written contract, it should at least be clear whether an element
of
the cause of action is based on alleged compliance or non-compliance
with the terms of a contract, and if not, on what alternative
basis,
the plaintiff asserts that element rests. At best for the plaintiff,
it is at least vague and embarrassing because the respondent
does not
know the whether the plaintiff is alleging that consent was given in
compliance with clause 17 or some other basis. Nor
is it clear, in
the alternative, if the alleged waiver was given in compliance with
clause 22 or on some other basis.
Second
exception:
[17]
Tirhani failed to attach a copy of the defendant’s alleged
written consent to its agreement of cession and assignment
with
Retrolex. Further the defendant denies being a party to the original
supply agreement, and therefore in law it could not have
consented to
the said agreement concluded between Tirhani and Retrolex. As such it
contends a critical component of the cause of
action is missing.
[18]
In so far as it is alleged this is vague and embarrassing this
exception must fail because insofar at the plaintiff pleads
that written consent was given on a particular date by itself, that
is sufficient detail for it to plead to. Secondly, the objection
that
the defendant cannot be a party to the agreement is premised on the
correctness of the defendant’s defence that there
could be no
valid assignment and cession of Excalibur’s obligations and
rights to it because Retrolex never consented thereto.
Insofar as the
plaintiff is able to plead the basis for consent and, or
alternatively, waiver as discussed under the
first exception,
then a basis for the defendant being a party to the agreement will
have been sufficiently clearly pleaded.
The pleading is not defective
for failing to disclose a critical element of the cause of action in
this respect.
Third
exception:
[19]
The notice of breach issued by Tirhani on 13 January 2016 was
addressed not to the defendant but to ‘Reinhard Vollmer’
and therefore did not comply with clause 14.1 of the supply
agreement, as a result of which the claim was premature in the sense
that notice of breach has not yet been given, and therefore the
critical element of the cause of action based on the supply agreement
is absent which means the pleading does not disclose a cause of
action. Once again this criticism is misplaced. The plaintiff did
plead that the notice addressed to Vollmer constituted notice to the
defendant. The defendant’s real objection is that it
disputes
that the notice sent to Vollmer, could in anyway be construed as
notice to itself. That is a matter for it to deal with
in its plea.
It knows that the plaintiff contends that notice constituted notice
of breach to itself. Accordingly, this exception
must fail on either
basis.
Fourth
exception:
[20]
As Argent is not a party to the supply agreement, the letter written
on its behalf on 10 May 2016 could not constitute an act
of
repudiation by the defendant. The reason this exception must fail is
that its foundation rests on a similar line of reasoning
raised in
the third exception, which essentially goes to the defendant’s
pleas not the plaintiff’s cause of action.
Fifth
exception:
[21] This complaint is in
truth two separate complaints.
[22]
The first complaint is that clause 12 of the supply agreement
excludes either party holding the other liable for loss of profits,
business, goods and any consequential or indirect loss or damage
suffered under the agreement however it arose and even if advised
of
possible damage in advance. Accordingly, the defendant contends the
plaintiff has no cause of action for damages for loss of
income due
to lost sales arising from the cancellation. Like some of the
objections mentioned, the defendant is essentially pleading
its
defence, namely that insofar as the supply agreement applies to it,
which it denies, it is indemnified against such a claim.
The
plaintiff’s particulars pleaded on this element to not suffer
from the type of ambiguity discussed in the first exception.
This
objection therefore also fails.
[23]
Lastly, the applicant claims that the amended particulars of claim
did not state the manner in which the special damages were
determined, contrary to Rule 18(10), and therefore lack all the
averments necessary to sustain a cause of action. I agree that
simply
identifying the items for which special damages are claimed and
attributing a lump sum to each item does not enable the
defendant to
make an assessment whether the plaintiff’s estimate is
reasonable or not
[1]
. At least
the plaintiff ought to have provided the basis on which it estimated
these figures, just as it did in arriving at the
amount of general
damages.
[24]
Accordingly, this objection is upheld insofar as the pleading of
special damages is vague and embarrassing.
Costs
[25]
The excipient was only partially successful, but the deficiencies in
the plaintiff’s particulars which rendered them
vague and
embarrassing ought to have been cured by amendments which would have
removed any justification for persisting with the
exceptions.
Accordingly, I am of the view the plaintiff should pay a portion of
the defendant’s costs.
Order
[1]
The first and sixth exceptions are upheld insofar
as they relate to the particulars of claim being vague and
embarrassing.
[2]
The plaintiff is given leave to file amended
particulars of claim to cure the defect within 10 days of the date of
this order.
[3]
The plaintiff must pay one-third of the
defendant’s costs.
_______________________
Lagrange
J
Judge
of the High Court of South Africa
Appearances
:
Applicants:
Adv. M. Sikhakhane instructed by Harris Nupen Melebatsi Inc.
Respondents:
Adv. D.L. Williams instructed by John Dua Attorneys
[1]
See
Minister van Wet en
Orde v Jacobs
1999
(1) SA 944
(O) at 953B-C.