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[2014] ZANCHC 35
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Kelbrick v Nel and Another (1275/2008) [2014] ZANCHC 35 (29 August 2014)
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTHERN
CAPE DIVISION, KIMBERLEY)
Case No: 1275/2008
Heard
on: 20-21/06/2011;
10-11/12/2013;
02/05/2014
Delivered on: 29-08-2014
In
the matter:
FRANCINA
ELIZABETH KELBRICK
PLAINTIFF
And
JOHANNES
CHRISTIAAN NEL
FIRST DEFENDANT
ELLA
DORATHEA MARIA NEL
SECOND DEFENDANT
JUDGMENT
Phatshoane
J:
1.
Ms
Francina Elizabeth Kelbrick, the plaintiff, claims an amount of
R315 000.00 from Mr Johannes Christiaan Nel and Ms Ella
Dorathea
Maria Nel, the first and second defendants, together with interest
and costs. This claim flows from an agreement of sale
of a certain
property known as Erf 491, 27 Church Street, Colesburg, on which a
licensed restaurant business called JC Restaurant
was conducted; the
sale of the business rights in respect of this property and movable
assets. The Nels filed a provisional counterclaim.
2.
The
sale of the restaurant and its concomitants was for an amount of
R815 000.00. According to the plaintiff Mr Fourie of Döhne
& Fourie Attorneys, acting on behalf of the Nels, suggested that
two agreements of sale be drafted. One for the sale of immovable
property at the purchase price of R500 000.00 (annexure “A”
to the plaintiff’s Particulars of Claim) and
the other for the
sale of business rights in the restaurant and movable assets for the
amount of R315 000.00 (annexure “B”
to the
plaintiff’s particulars of claim). This proposal was made in
order for the transaction not to attract the payment
of transfer
duty. The plaintiff agreed to pay an initial deposit of R200 000.00
for the transaction which she borrowed from
her bond account and the
additional R115 000.00 which she borrowed from her son. She paid
these amounts electronically into
the Nels’ bank account.
3.
The
agreements of sale referred to were concluded on 24 September 2007.
Their effect is the same and each has a suspensive condition
which is
crucial to the issues in dispute between the parties. The conditions
are contained in clauses 18.2 and 16.1 of annexure
“A”
and “B”, respectively. Clause 18.2 reads:
“
Hierdie transaksie is
onderhewig aan die suksesvolle verkoop van koper se eiendom geleë
te Jeffreysbaai en word die opbrengs
daarvan gebruik om die koopsom
soos in paragraaf 4.1 genoem te betaal en die registrasie van
transport van die eiendom geleë
Jeffreysbaai, moet dus
gelyktydig geregistreer word met hierdie registrasie van transport.”
Clause 16.1 stipulates:
“
Die geldigheid van hierdie
ooreenkoms sal onderhewig wees aan die verkoping van die Koper se
eiendom geleë te Jeffreysbaai
asook die suksesvolle oordrag van
die onroerende eiendom waarop die besigheid bedryf word in Koper se
naam.”
4.
The
agreements are silent on the date on which the aforesaid suspensive
conditions would be regarded as having been unfulfilled.
Put
differently, they do not stipulate the date in respect of which the
sale of the restaurant business would be regarded as having
lapsed
due to the nonfulfillment of the conditions of the sale.
5.
In
her Particulars of Claim the plaintiff pleaded,
inter
alia
,
that it was an expressed, alternatively tacit, further alternatively
implied term of the agreements that the suspensive condition
would be
fulfilled within a reasonable time. That such a reasonable time
lapsed at the end of February 2008, in other words, approximately
six
months after she had placed her property in Jeffreys Bay on the
market. The contracts had therefore come to an end and that
each
party is entitled to restitution in respect of its performance.
6.
In
the alternative, the plaintiff pleaded that during October 2007 the
parties entered into an oral agreement the term whereof was
that the
reasonable period which would constitute the end or expiry date for
due performance was the end of February 2008. That
this oral addendum
to the agreement was confirmed by the Nels. She further states that
as her property was not sold by the end
of February 2008 the contract
came to an end.
7.
In
the further alternative, the plaintiff pleaded rectification. She
stated that around September 2007 the parties entered into
a written
agreement which does not record the full terms contemplated by the
parties. That the suspensive condition should have
included the
following term: “
Die
suksesvolle verkoop van die koper se eiendom geleë te
Jeffreysbaai moet plaasvind voor of op einde Februarie 2008
.”
That the error in the formulation of the contract was occasioned by a
mutual mistake of the parties and that the contract
was signed in the
bona
fide
but mistaken believe that a complete version and true meaning of the
parties’ intention was recorded therein. The plaintiff
pleads
therefore that the dispute between the parties be determined on the
basis of the proposed rectified agreement.
8.
Lastly,
the plaintiff pleaded enrichment. She contended that the two
contracts are composite and indivisible. That she considered
the
offers made by the Nels and was not amenable to accepting them
unqualified. As a result, she amended the terms of the offer
by hand,
signed next to these amendments and forwarded the amended contracts
to the Nels’ attorneys. It was argued on her
behalf that by so
doing the plaintiff made a counter-offer to the Nels. They did not
accept same by countersigning next to the
amendments and therefore no
agreements were reached. She says that in the
bona
fide
believe that the counter-offer was accepted by the Nels she made
payment to them in the amount of R315 000.00 on the basis
of the
ostensible agreements thereby enriching them by that amount and was
impoverished by the same amount.
9.
The
Nels on the other hand pleaded that the end of February 2008 does not
amount to a reasonable time within which the suspensive
condition
could be regarded as unfulfilled regard being had to the country’s
economic slump during the months that the property
in Jeffreys Bay
was placed on the market. That the high interest rates and the
downturn in the real estate industry at that stage
were adverse
factors. They pleaded further that the suspensive conditions should
be deemed to have been fictionally fulfilled due
to the deliberate
and intentional actions on the part of the plaintiff to prevent
fulfilment in that, despite the unfavourable
market conditions, she
still claimed an unreasonable purchase price for her property; that
she did not market the property as she
should have and/or did not
proceed with the sale; that she prematurely removed the property from
the market and the “For
sale” or advertisement
boards in respect of the sale.
10.
The
Nels contended further that when the business was delivered to the
plaintiff on 01 November 2007 its goodwill was valued at
R360 000.00.
They pleaded that the plaintiff abandoned the restaurant on 29
February 2008 and removed the antique water tank
valued at R8000.00
from the premises. That the business was not returned or delivered
because what was restored was: an entity
with a different name and
without goodwill; a completely altered menu; and an insufficient
staff composition. They state that the
business premises was broken
into in April 2008 and the equipment to the value of R12 000.00 was
stolen. Following this incident
and in mitigating their loss they
continued with the business in May 2008 albeit under protest.
11.
The
Nels went on to plead that the plaintiff received and possessed the
business rights, the goodwill, and the movable assets against
a
payment of an amount of R315 000.00. That she conducted the
restaurant business for her own account, profit and loss for
the
period 01 November 2007 to February 2008. That the goodwill, the
historic water tank and their net income were received or
taken or
used by the plaintiff or that she had the value and use thereof which
she did not deliver or restore to the Nels and therefore
they (the
Nels) were not enriched at her expense nor was she impoverished in
the process.
12.
Halfway
through the plaintiff’s testimony the Nels requested a
postponement to amend their plea. In its original form the
plea read
as follows:
“
Behalwe om te ontken dat die
handgeskrewe verandering aan klousules 9.3, 10.1, 14.1, 14.1.1 en 15
van aanhangsel A en 4.1, 5.1,
8.1, 8.1.1., 15.6 en 15.8 deel vorm van
die ooreenkoms tussen die partye, word die res van die beweringe
erken. Verweerders pleit
dat die handgeskrewe veranderinge by
bovermelde klousules eensydiglik deur Eiseres ingeskryf is (en sy
alleen daarby parafeer het)
nadat die kontrakte eerste deur
verweerders onderteken is, en dat verweerders nie ingestem het tot
en/of parafeer het by die veranderings
(teenaanbod) deur die eiseres
nie.”
13.
In
their latest amended plea, about the sixth amendment, the Nels state,
inter
alia
,
that the handwritten amendments effected on the contracts by the
plaintiff were accepted by them by countersigning next to the
alterations. To this end they attached annexure “K1” and
“K2” to the amended plea being the contracts
countersigned by them. Alternatively, should the Court find that the
handwritten counter-offer made by the plaintiff was not accepted
by
them, they pleaded that the amendments were not material and/or were
severable from the material terms, with the resultant effect
that the
remainder of the agreement is valid and enforceable. Counsel for the
Nels contended that the plaintiff was alerted to
the acceptance of
her counter-offer tacitly and/or by conduct in that following the
conclusion of the contracts the plaintiff paid
the purchase price for
the restaurant and the
merx
was
delivered to her.
14.
On
closer examination, the move for an amendment referred to in the
preceding two paragraphs is destructive of the plaintiff’s
enrichment claim referred to in para 8 above. Mr Nel testified that
upon the plaintiff having effected the amendments to the contracts
they also countersigned next to those amendments and their legal
representatives were aware that they had done so. Adv Claasen
SC, for
the plaintiff, argued that if it is true that the Nels’ legal
representatives knew that they (the Nels) countersigned
the amended
agreements when they (the legal representatives) initially settled
the plea then they misled the plaintiff and the
Court that the
amendments to the contracts were not countersigned by the Nels.
SOME
BACKGROUND INFORMATION:
15.
Following
her retrenchment in Johannesburg the plaintiff learned of a
restaurant that was on sale in Colesburg. She received two
signed
agreements from the Nels and took them with so as to scrutinise them.
She effected certain amendments to the contracts and
called Mr
Fourie, the Nels’ attorney, to inform him of her discontentment
with certain clauses. Mr Fourie requested her to
effect changes to
the clauses and initial next to them which she did and faxed the
contracts back to him. Not much turns on most
of the alterations she
made to the contracts.
16.
The
plaintiff deleted,
inter
alia
,
clause 14.1.1 and 8.1.1 of the contracts at annexure A and annexure B
of the Particulars of Claim, respectively. These clauses
stipulated
that in the event of the breach, i.e where the purchaser failed to
comply with any of the terms or the conditions of
the sale, the
seller or his agent would have a right to cancel the agreement after
seven days written notice to the purchaser to
remedy the breach. She
deleted a term to the effect that on this cancellation she stood to
forfeit all the amounts paid to the
Nels or their agent without
prejudice to any of their rights and remedies including their right
to claim damages.
17.
The
plaintiff testified that there was no discussion with her that the
amount of R315 000.00 that she paid would be kept in
trust until
there was certainty on the fulfilment of the condition. She took
occupation of the restaurant on 01 November 2007 and
effected many
improvements on it. The list of the improvements is quite lengthy. By
way of an example, she says she painted the
front burglar bars; she
installed an advertisement light box to the value of R4000.00 to
advertise the restaurant because it had
no name written on its
outside wall; she cleaned the footpath near the building and the
pizza oven area; she installed a double
washbasin worth R1800.00 near
the pizza oven area; she fixed the leaking kitchen roof; she replaced
the window panes that were
broken; she introduced more tables to the
sales area, and so forth.
18.
The
plaintiff testified further that she understood that the “cut-off
date” for the fulfilment of the condition was
the end of
February 2008. This is so because when she called Mr Fourie about the
amendments she needed to effect on the contracts
he told her that she
must not think that she had until December 2008 to sell her house in
Jeffreys Bay. She then told Mr Fourie
that December to February was
the best time to sell her house and if she had not sold it by the end
of February 2008 it may take
some time before the property was sold.
She also accepted that the Nels knew of this date because in a
meeting she had with Mr
Nel early in January 2008 she told him that
she had not received any offers yet. Nel responded by saying “we
will see what
happens in February”.
19.
With
the end of February 2008 fast approaching the plaintiff directed a
letter to the Nels’ attorney on 18 February 2008 which
reads:
“
Meneer Fourie
I/s:
KONTRAK TUSSEN JC EN EDM NEL &
FE KELBRICK – 27 KERKSTRAAT
In klousule 18.2 van ons kontrak is
die koop van 27 Kerkstraat onderhewig aan die verkoop van my eiendom
in Jeffreysbaai.
Volgens my telefoniese gesprek met u
in Oktober 2007, het ons ooreengekom dat Februarie ‘n redelike
afsnydatum vir die ‘nie-verkoop’
van my eiendom sal wees.
Ek het met Chris en Ella in die begin
van Januarie daaroor gepraat en Chris het bevestig dat ons vir
Februarie wag.
Hiermee wil ek graag aan u rapporteer
dat tot op datum ek nog nie een skriftelike aanbod op my eiendom, 18
St Francisstraat Jeffreysbaai,
te koop, ontvang het nie.
Indien dit lei tot kontrakbreuk voel
ek dat ek ‘n redelike tyd nodig het om die eiendom, 27
Kerkstraat, te ontruim.
Daarom die brief.
Ek berei my voor om die eiendom teen
die einde van Februarie te ontruim indien nodig.
Sal u asseblief ontvangs van my skrywe
erken.”
20.
On
25 of February 2008 the plaintiff wrote a further letter to Mr Fourie
which states:
I/s:
KONTRAKTE TUSSEN JC EN EDM NEL
& FE KELBRICK – 27 KERKSTRAAT
Ek verwys na bogenoemde en my brief
gedateer 18 Februarie 2008.
Ek het nog nie van u gehoor nie.
Mnr en Mev Nel het met my afgespreek om my Saterdagaand by die
restaurant te kom sien maar
hulle het nie vir die afspraak opgedaag
nie.
Na die beste van my wete is alle
bepalings en verpligtinge deur beide partye nagekom, behalwe die
dranklisensie is op Mnr Nel se
naam hernu en deur my betaal.
Die opskortende voorwaarde is egter nie binne ‘n redelike tyd
vervul nie.
Ek vra hiermee ‘n vergadering
aan waar almal teenwoordig sal wees sodat ons die effek daarvan op
die partye, synde die terugbetaling
van deposito en die
her-inbesitneem van die restaurant en inhoud daarvan kan bespreek.
My gedagte is dat alles voor of op 29
Februarie 2008 moet geskied.
Ek verneem dringend van u.”
21.
The
plaintiff received no response from Mr Fourie in respect of the above
two letters. From what one gathers from a letter addressed
by the
plaintiff to Mr Fourie dated 28 February 2008 below is that around 27
February 2008 a meeting was held between the parties
and Mr Fourie
but yielded no positive results. This letter reads:
“
Meneer Fourie
I/s:
KONTRAKTE TUSSEN JC en EDM NEL
& FE KELBRICK – 27 KERKSTRAAT
Met verwysing na ons gesprek gister in
u kantoor. Ek het aangedring tot ‘n vergadering met u mnr
en mev Nel en myself
aangesien mnr en mev Nel nou wil afwyk omtrent
die ‘redelike’ tyd wat ek en u (namens u kliënt)
telefonies in
Oktober 2007 ooreengekom het en waarmee mnr Nel
toegestem het.
Aangesien ek bewus was dat mnr en mev
Nel haastig was met die verkoop van die restaurant (hulle het ‘n
huis in gedagte gehad)
en u woorde, “moenie verwag dat ‘n
redelike tyd Desember 2008 beteken nie”, het u en ek
mondelings, telefonies,
ooreengekom dat Februarie 2008 ‘n
redelike tyd is. Mnr en mev Nel het ook goedkeuring aan die
datum verleen deurdat
mnr Nel vroeg in Januarie 2008 vir my gesê
het dat, “ons wag vir Februarie”, nadat ek hom meegedeel
het dat ek
nog nie ‘n koper vir my huis het nie. Ek wil
met hierdie skrywe aan u weereens bevestig dat my eiendom, ten spyte
van
verskeie agente wat dit probeer verkoop, tot op datum nie verkoop
is nie, en ek nog nie ‘n geskrewe offer ontvang het nie.
Dit is duidelik dat Februarie nie vir
mnr en mev Nel ‘n probleem is nie aangesien mnr Nel bereid is
om die kontrak onmiddellik
te kanselleer met die voorwaarde naamlik,
om net R50 000,00 aan my terug te betaal, daaraan verbonde. Ek
bevestig die ferme
ooreenkoms dat Februarie 2008 die ongeskrewe datum
vir die ‘redelike’ tyd, wat nie in die kontrak
gespesifiseer was
nie, is.
Ek bevestig dus hiermee dat die
kontrak se voorwaarde nie realiseer het nie, op grond van my eiendom
wat nie verkoop nie, en die
verstryking van die redelike tyd wat deur
albei partye bevestig is.
Ek sal die bestekopname van die
toerusting en die gebou gereed hê op 29 Februarie 2008, 15:00
vir inspeksie en die sleutels
dan oorhandig. Die inventaris van
die inhoud en toerusting sal saam met my swaer Anton du Plessis
opgestel word.
Mnr en mev Nel of uself moet tussen
15:00 en 16:00 teenwoordig wees vir die oorname en oorhandiging van
die sleutels by die restaurant
te Kerkstraat 27, Colesberg. Ek
ontvang ook terselfdertyd die terugbetaling van die bedrag van
R315 000,00, Drie Honderd
en Vyftienduisendrand, in kontant.
Ek het reeds reëlings getref vir
die verwydering van al my meubels en persoonlike goed en sal
gevolglik nie, nadat ek die sleutels
oorhandig het, op die perseel
wees nie.
Bevestig asseblief dringend die
reëling.”
22.
The
plaintiff says that she also did not receive a response to the above
letter. Nevertheless, she returned the
merx
at end
February 2008. She denied having abandoned the restaurant. She
further says that she told the Nels that she was prepared
to help
them out with the business after February 2008 until they were ready
to run it again. The Nels declined her offer for help.
23.
The
plaintiff went on to explain that on 20 May 2008, two months later,
she received a letter dated 06 March 2008 from Mr Fourie
which
appeared to have been backdated, because from the postal stamp it was
sent on 07 May 2008. She responded to the letter. In
his letter Mr
Fourie refers to various letters written to him by the plaintiff and
the meeting of February 2008. What is sketched
out in this letter is
largely disputed by the plaintiff in her replication.
24.
The
plaintiff also testified that there is no term in the agreement
stipulating that she could not use a different name for the
restaurant or that restricted how she had to conduct the business.
She says that she discussed the name change from “JC
Restaurant” to “Devine Restaurant” with Ms Nel and
her two daughters. Ms Nel was not averse to the change and
commended
this as a good idea. The plaintiff denies that she completely altered
the restaurant menu but confirmed having changed
certain of the
dishes because there were no trained chefs. During her evidence she
painstakingly went through the menu to point
out the difference
between her menu and the Nels’ menu. These differences are of
no moment and neither was there any profound
contrast shown between
them.
25.
Insofar
as the Nels pleaded that the staff composition was different at the
time of handing over, the plaintiff maintains that nothing
in the
contract precluded her from bringing in her own staff. Nevertheless,
she testified that when she took over the restaurant
there were four
employees from the Nels stable. One employee resigned shortly
thereafter. She also appointed a barman as there
was none in her
staff complement.
26.
The
plaintiff explained that she put her house on the market for an
amount of R1.4 Million rand from September 2007. She arrived
at this
amount based on information she received from various people. She has
also worked in the property industry before. She
says that the house
situated next to hers was sold for R1.6 Million and was registered in
January 2008. She requested Realnet Estate
Agents, Seeff Properties
and Pam Golding to market her property. It was also put on the
internet for sale. At no stage did she
withdraw the house from the
market until 01 February 2011. She did not receive any offers to buy
the house for the period September
2007 to end February 2008. During
this period she had decided not to lease her property in an attempt
to have it sold. At the end
of February 2008 she instructed the
estate agents to remove the “For sale” signs that were
hung on her gate because
it is impossible to attract prospective
tenants with the signs hanging on the property.
27.
Mr
John Gordon Enslin Cooper was called as an expert witness in the
property industry by the plaintiff. He is an experienced estate
agent. He had conducted real estate business in various towns
including Jeffreys Bay since 1984. He inspected the plaintiff’s
property and took photographs thereof. His company had a mandate to
market it through independent listing services where the property
would be put on the listing service so that other estate agents are
able to market it as well. According to him the purchase price
was
fair and reasonable. The two nearest comparable properties were sold
for R1.6 million and R1.3 million in January and February
2008
respectively.
28.
Mr
Cooper testified that during the boom period which includes the
period in respect of which the property was in the market there
are
numerous investors who would purchase the property for rental
purposes. He intimated that the property lends itself quite well
to
an investor but also to a country purchaser who possibly would let
out the flat and lock up the balance of the house for his
personal
use. September to February is the best time for the estate agents to
sell properties in Jeffreys Bay and other coastal
areas. In his
opinion the period September 2007 to February 2008 would be a
reasonable period within which the plaintiff could
sell her property.
In his 27 years of experience December and January is the prime time
to sell immovable properties.
29.
Cooper
testified that Kouga Municipality has very strict signage guidelines
for the estate agents. The “For sale”; “On
show”
boards; and flags are only permitted on Friday afternoons and should
be removed on Monday mornings before 10h00. He
added that there are
other marketing solutions that the estate agents can offer to a
seller. Under cross-examination he testified
that on average it would
take three to nine months for a property placed on the market to
sell, depending on the property markets.
In boom times it will sell
far much quicker than would be the case in tough economic
circumstances. He intimated that the plaintiff’s
property was
in a popular street and would always be in demand because of its
proximity to the CBD, the beach, schools, police
station and similar
facilities and therefore six months was a reasonable period for the
sale to be perfected.
30.
Mr
Nel, the first defendant, was a school teacher and a restaurateur at
night. JC Restaurant was his family business which he operated
from
2001 until October 2007. His average net profit was between
R10 000.00 to R12 000.00 per month. He says that during
the
festive season, particularly in December and January, the profit
would escalate between R60 000.00 and R90 000.00
per month.
31.
Mr
Nel says that the purchase price of R815 000.00 was broken down
as follows: R50 000.00 was for the movable assets,
while the
value of the business and the building was R265 000.00 and
R500 000.00, respectively. He used the R315 000.00
paid by
the plaintiff to discharge his other obligations and did not
ring-fence it. He was aware that if the condition was not
fulfilled
restitution had to take place.
32.
Mr
Nel stated that there was a historical water tank which was brought
onto the property in 1902 by a doctor who previously owed
the
building but could not recall if he informed the plaintiff to look
after this tank. When this tank was showed to him as depicted
on the
photos, lying in the rubble, he was hesitant to identify it. However,
he was unable to dispute the fact that the tank was
exposed to the
elements since 1902.
33.
Mr
Nel says that he informed the plaintiff to take her time to sell her
house in Jeffreys Bay. He did not put any pressure on her
to
terminate the agreements. He further confirmed having told the
plaintiff that they should wait until the end of February 2008
to see
how things would develop with regard to the sale of her property. He
testified that at the meeting held in February 2008
between the Nels,
accompanied by their attorney on the one hand and the plaintiff on
the other hand she told them that she wanted
to end the contract at
the end of February 2008 because she could not pay off her bond in
Jeffreys Bay and also keep up with the
R4000.00 occupational rent.
They were supposed to meet a week later following the meeting of
February 2008 but could not because
Mr Fourie’s secretary
brought to him the restaurant keys and the inventory list. He
intimated that it was never the parties’
agreement that the end
of February 2008 would be the date in respect of which the conditions
would be regarded as unfulfilled.
He says that it was not a mistake
that the date was not specified in the agreement. He denied that the
plaintiff offered to manage
the restaurant after February 2008.
34.
Mr
Nel further testified that after the plaintiff had vacated the
business premises it was not in operation in March and April 2008
because he had school commitments. The restaurant was broken into
during that period and some of the equipment had to be replaced.
He
testified that the restaurant that was handed over to him was not in
the same condition. It had a name change; the menu was
different and
so was the staff composition. When he resumed with the business in
May 2008 he noted that the guesthouses were not
sending him customers
as before. He had to market the business afresh. His testimony on the
changes he says he disapproved of came
to naught due to a number of
material concessions he made under cross-examination: He said that he
was not dissatisfied with the
changes, particularly to the new name
of the business and the menu. Not much need be said about the staff
complement because the
restaurant was not operational for two months
after the plaintiff’s departure. The laid off staff had to fend
for themselves.
DETERMINATION OF THE
ISSUES ARISING FOR CONSIDERATION:
35.
The
following dictum in
Haviland
Estates (Pty) Ltd and Another v McMaster
1969
(2) SA 312
(A) at 336B-G is instructive:
“
Where parties commit their
agreement to writing, they intend that the writing should be the
exclusive memorial of the reciprocal
rights and obligations they
intended creating by their agreement. The definition of the rights
and obligations they intended creating
is, therefore, in every case
(rectification apart) governed by the meaning of the words used by
them in the memorial of their agreement.
(See Worman v Hughes and
Others,
1948 (3) SA 495
(AD), per GREENBERG, J.A., at p. 505). If a
party relies upon the memorial as the source of the right claimed by
him, he must satisfy
the Court that the right, to its full extent, is
so defined in the memorial. The Court is not permitted to go beyond
the definition
included in the memorial by agreement between the
parties. Not infrequently a party agrees to the definition of a right
in his
favour in terms which subsequently result in the right being
inadequate in relation to his needs in the field in which he
anticipated,
at the time of contracting, that the right, as defined,
would fully and effectively satisfy those needs. He may agree to this
'inadequate'
right because, e.g. he lacks bargaining power or the
ability to foresee correctly future developments or possibly because
he unwisely
relies upon the continuance of a state of things existing
at the time he agreed to the terms defining his right. It not
infrequently
occurs that, where subsequent developments show that a
party has contracted 'inadequately', equitable considerations may at
times
give rise to a natural desire to come to the aid of the party
concerned, particularly so where the 'inadequacy' of his right
virtually
affects him. This feeling of sympathy should, however, not
be permitted to blunt the Court's understanding of the meaning of the
words. In this regard it is instructive to bear in mind the approach
of this Court in cases such as
Lanfear
v du Toit,
1943 AD 59
;
van
der Merwe v Viljoen
,
1953
(1) SA 60
(AD) and what was said by Ogilvie Thompson J.A., in his
judgment in the case of
Owsianick
v African Consolidated Theatres (Pty) Ltd
1967 (3) SA 310
(AD) at p. 317E.”
36.
The
issues largely turn on whether the period September 2007 to the end
of February 2008 was a reasonable time for the conditions
precedent
to be regarded as unfulfilled thereby releasing the parties from
their contractual obligations. There is also a dispute
between the
parties on whether they verbally agreed that February 2008 would be a
date upon which the sale of the restaurant would
lapse if the
conditions were not fulfilled. I would commence the enquiry with the
latter issue because if there was a verbal agreement
it would put an
end to most of the disputed issues raised in the papers.
37.
Adv
Claasen SC, for the plaintiff, argued that there was a verbal
agreement between the parties to the effect that the end of February
2008 would be the expiry date for the plaintiff’s due
performance. In his countervailing argument Adv Benade, for the Nels,
contended that the plaintiff’s purported verbal agreement
regarding the February 2008 deadline was seemingly agreed to between
the plaintiff and the Nels’ attorneys and was therefore not
binding on the Nels.
38.
The
letters referred to earlier, which the plaintiff directed to the
Nels’ attorneys, repeatedly refers to the agreement reached
between the parties on the so-called “cut-off date”. It
is disquieting that the attorney did not respond to any of
these
letters until late when the horse had already bolted. The period of
two months that passed before the plaintiff could receive
a response
from her numerous letters directed to Mr Fourie is suspiciously long.
In
McWilliams
v First Consolidated Holdings (Pty) Ltd
1982 (2) SA 1
(A) at 10 B-H the Court had the following to say
regarding failure to answer letters particularly where issues
pertaining to the
contract between the parties are traversed therein:
“
I turn
now to the letter of 21 April which the appellant received, no doubt
shortly after that date, but to which he made no reply
nor offered
any protest. It appears to me that the appellant's silence in the
face of that letter is of paramount importance in
the decision of the
case. The first paragraph of the letter announces in the clearest
terms that an agreement was concluded on
5 April 'on the terms and
conditions' set out in the memorandum, which was attached to the
letter. Paragraph 2 expressly confirms
that it had been agreed that
the oral agreement referred to in paragraph 1 was binding even though
no agreement was signed. And
para 3 refers to a conversation between
Schneider and the appellant in Port Elizabeth, when the appellant
expressed the wish to
have his attorney 'vet the written agreement' -
it is repeated in this paragraph that the memorandum 'incorporates
the terms upon
which we agreed...'.
I accept that
'quiescence is not necessarily acquiescence' (see
Collen
v Rietfontein
Engineering
Works
1948 (1) SA 413
(A) at
422) and that a party's failure to reply to a letter asserting the
existence of an obligation owed by such party to the
writer does not
always justify an inference that the assertion was accepted as the
truth. But in general, when according to ordinary
commercial practice
and human expectation firm repudiation of such an assertion would be
the norm if it was not accepted as correct,
such party's silence and
inaction, unless satisfactorily explained, may be taken to constitute
an admission by him of the truth
of the assertion, or at least will
be an important factor telling against him in the assessment of the
probabilities and in the
final determination of the dispute. And an
adverse inference will the more readily be drawn when the
unchallenged assertion had
been preceded by correspondence or
negotiations between the parties relative to the subject-matter of
the assertion. (See
Benefit
Cycle Works v Atmore
1927
TPD 524
at 530 - 532;
Seedat
v Tucker's Shoe Co
1952 (3)
SA 513
(T) at 517 - 8;
Poort
Sugar Planters (Pty) Ltd v Umfolozi Co-operative Sugar Planters
Ltd
1960 (1) SA 531
(D) at
541; and of
Resisto Dairy
(Pty) Ltd v Auto Protection Insurance Co Ltd
1963
(1) SA 632
(A)
at
642A - G.) I have no doubt that appellant's silence and inaction
after receipt of the letter justify an inference adverse to
him.”
Compare
Sun Radio and
Furnishers v Republic Timber & Hardware (Pty) Ltd
1969 (4) SA
378
(T) at 381D-G where the following remarks were made by the
learned Judge:
“
Manifestly
there is a clear and urgent duty to speak against an incorrect
recording of the terms of a contract in the process of
negotiation,
failing which the recorded terms will bind the party who remained
silent.
The principles enunciated in
Benefit
Cycle Works v Atmore
[
1927
T.P.D. 524]
, supra, dealing with a letter recording a telephonic
conversation in which the defendant was said to have assumed
liability, are
more applicable to this case. DE WAAL, J.P., stated at
p. 530:
'. . .
a
letter which places on record something false does not necessarily
call for a reply from the person to whom it is addressed',
and further:
'But where, as in this
case, negotiations had taken place immediately preceding the writing
of the letter, and the writer places
on record his version of what
had taken place during the negotiations, and there is no reply by the
other side, then the Court
is bound to attach the greatest importance
to that fact.'
Quoting from the English case
Willeman
v Walpole
(1891) 2 Q.B. 534
, DE WAAL, J.P., at p. 531 confirms
the relevant principle of law to be as follows:
'The only fair way of
stating the rule of law is that in every case you must look at all
the circumstances under which the letter
was written, and you must
determine for yourself whether the circumstances are such that the
refusal to reply alone amounts to
an admission.'
”
See also
Hamilton v
Van Zyl
1983 (4) SA 379
(E) at 388E-H.
39.
It
is as well to remember that the plaintiff’s testimony was to
the effect that the agreement on the date in respect of which
the
sale would be regarded as having lapsed did not end with the attorney
but was confirmed by the Nels. To my mind there is some
credence in
the plaintiff’s version regarding the confirmation of the oral
agreement by the Nels. This is so because Mr Nel
did not dispute the
plaintiff’s version that he advised her that they would have to
wait until the end of February 2008 to
see if her house in Jeffreys
Bay would be sold. It may well be that he also understood the
“cut-off date” for the nonfulfillment
of the conditions
to have been the end of February 2008 or acquiesced thereto. But this
matter does not end here because Mr Benade’s
further argument
is that the written agreements had a non-variation clause which
stipulates:
“
Uitsluiting van ander afsprake:
Die ooreenkoms kanselleer en vervang
alle kontrakte aangegaan tussen die partye voor datum hiervan en geen
wysigings, aanvullings
of ooreegekome kansellasie van die ooreenkoms
sal van krag wees tensy dit op skrif gestel en deur die partye
onderteken is nie.”
Mr Benade contended that
the verbally agreed February 2008 end date was an addition to the
contracts already concluded. For this
addition to be valid and
enforceable or binding on the parties it ought to have been reduced
to writing and signed by them.
40.
It
is trite that a non-variation clause should be interpreted
restrictively as it curtails the freedom of contract. See
Randcoal
Services Ltd and Others v Randgold and Exploration Co Ltd
[1998] ZASCA 45
;
1998
(4) SA 825
(SCA) at 841E-F. The history of this matter highlights
some disparity of the bargaining power
between
the plaintiff and the Nels when they concluded the contracts. This is
so because from the onset up to and including the
time when the
dispute arose between them the plaintiff was not legally represented
whereas the Nels were assisted by an attorney,
Mr Fourie. As alluded
to, the plaintiff testified that she understood that February 2008
was the “cut-off date” following
her discussion with Mr
Fourie on the changes she wished to effect on the agreements before
she could sign them. Whether Mr Fourie
also understood that the sale
of the restaurant would have lapsed at the end of February 2008
remains unexplained as he was not
called to the stand. Nevertheless,
the plaintiff’s testimony to the effect that she and the
attorney, the agent of the Nels,
agreed on the “cut-off date”
remains uncontroverted.
41.
From
the plaintiff’s own version the oral agreement with the Nels’
attorneys came into being prior to her signing the
agreements of
sale. What runs counter to her account is that the agreements
of sale she signed cancel all the agreements
concluded prior to them.
In the nature of things this would include the agreement she reported
to have concluded with the attorney
regarding the “cut-off
date”. However, sight should not be lost that her evidence
suggests that the oral agreement
in respect of the “cut-off
date” was reconfirmed by the Nels after the conclusion of the
agreements.
42.
Mr
Claasen argued that the operation of a non-variation clause does not
extend to a subsequent agreement by the parties on an issue
not dealt
with in the contract. He pressed that the verbal agreement was not a
variation of the parties’ contractual obligations
or an
additional obligation between them. In support of his argument,
he referred to
Randcoal
Services Ltd and Others,
supra,
where the Court had to,
inter
alia
,
determine if the substitution agreement which came later during
negotiations between the parties and mainly addressing the question
of the employees’ medical aid contributions was an addition to
their prior restructuring agreement. The facts in
Randcoal
Services Ltd
are completely distinguishable from the present. In that case the
Court held that the restructuring agreement did not deal at all
with
the issue of liability for the payment of the ex-employees' medical
aid contributions. It therefore found that the substitution
agreement
did not
amend
the restructuring agreement by adding to its actual subject-matter.
43.
In
my view, the mentioned orally agreed end of February 2008 “cut-off
date” cannot be divorced from the agreements of
sale because it
seeks to expressly set out the date in respect of which the sale of
the restaurant would lapse. To my mind, it
was a fundamental addition
which ought to have been reduced to writing and signed by both
parties. The principle applicable in
this situation was reaffirmed as
follows in
HNR
Properties CC and Another v Standard Bank of SA Ltd
2004 (4) SA 471
(SCA) at
479C-F
para 19:
“
In
SA
Sentrale Ko-op Graanmaatskappy Bpk v Shifren en
Andere
1964 (4) SA 760
(A)
this
Court held that a term in a written contract providing that all
amendments to the contract have to comply with specified formalities
is binding. The principle has been consistently reaffirmed, most
recently by this Court in
Brisley
v Drotsky
2002 (4) SA 1
(SCA)….
Courts have in the past, often on dubious grounds, attempted to avoid
the Shifren principle where its application would result
in what has
been perceived to be a harsh result. Typically, reliance has been
placed on waiver and estoppel. No doubt in particular
circumstances a
waiver of rights under a contract containing a non-variation clause
may not involve a violation of the Shifren
principle, for example,
where it amounts to a pactum de non petendo or an indulgence in
relation to previous imperfect performance.”
44.
Mr
Claasen sought to argue that the contract did not prohibit the verbal
variation of the non-variation clause therefore parties
can agree not
to abide by it or to amend it. There is no evidence in support of the
existence of an agreement to this effect.
45.
I
now turn to the question on whether the period from 20 September 2007
to February 2008 was a reasonable time for the fulfilment
of the
suspensive condition. In the absence of an agreement on a specific
date for the fulfilment of the condition, it would be
implied that
the obligation to give efficacy to the agreement of sale would be
discharged after the lapse of a reasonable time.
In
Lanificio
Varam S.A. v Masurel Fils (Pty) Ltd
1952
(1) SA 581
(C) at 586B-C the Court made the following pronouncement:
“
It is a rule of law that, where
the parties have not expressly fixed the time for the performance of
a contract, it must, unless
the other terms of the contract indicate
a contrary intention, be implied that performance should take place
within a reasonable
time. Halsbury (2nd ed., para. 268, p. 190);
Williston on Contracts, Vol. 1, para. 38, p. 101; Hick v Raymond &
Reid, 1893
A.C. (H. of L.) 22. In my opinion the same rule applies to
a condition in a contract requiring that some act should be performed
in order that an obligation under the contract can come into
existence.”
46.
Compare
Design
and Planning Service v Kruger
1974 (1) SA 689
(T) at 697G-H where Botha J puts it thus:
"In my view, when a suspensive
condition, of a kind which has not been inserted in the contract for
the specific benefit of
one of the parties only, remains unfulfilled
after the lapse of a reasonable time for fulfilment, the contract is
discharged automatically,
by virtue of an implied term to that
effect, unless there is something in the contract negativing the
implication of such a term,
and subject to the possibility of
fictional fulfilment of the condition by reason of the conduct or
inaction of either of the parties.
Ordinarily, no action on the part
of either of the parties equivalent to a placing in mora of the other
in relation to the fulfilment
of the condition as such is required
before the contract comes to an end."
47.
Mr
Benade argued that by the plaintiff’s own admission she had a
long-term plan for the restaurant and had effected many improvements
thereon. That she did not receive any pressure from the Nels to
expedite the sale of her house in Jeffreys Bay and therefore the
end
of February 2008 was not a reasonable period for the conditions to be
fulfilled. He contended that the letters that the plaintiff
wrote to
the Nels’ attorneys in February 2008 demonstrates that she
desperately wanted to resile from the contracts because
she had
changed her mind about the transaction. In addition, he argued, that
the plaintiff removed the “For sale” signs
on her
property in Jeffereys Bay. That around January and February 2008 she
did not lower her asking price of R1.4 million rand
for her house to
be sold while her outstanding debt on the mortgage bond was
R300 000.00. That she did nothing after she had
returned the
restaurant to the Nels but remained jobless on a farm outside
Colesburg for several months.
48.
In
St.
Martin's Trust v Willowdene Landowners’ (Pty) Ltd
1970
(3) SA 132
(W) at 135F–136C the Court laid down the following
principles as governing the enquiry into the question whether a
reasonable
time for the fulfilment of a suspensive condition in the
contract had elapsed:
“
It will be sufficient if I
state the following principles which seem to me to govern a case of
this kind.
(a)
As the problem, namely, whether or not a reasonable time for
performance
has been allowed, arises out of contract, it is to be
resolved in the light of the intention of the parties, as expressed
by them,
or as properly inferred by the Court from the language of
the contract and the surrounding circumstances.
(b)
In deciding what would have been a reasonable time the Court must
have
regard to the nature of the performance which was due by the
party who is alleged to have been in default, and to the
difficulties,
obstacles and delays attendant upon such performance.
(c)
The difficulties, obstacles and delays to be taken into account are,
however, only
such as were within the contemplation of the parties at
the time of the contract. That was laid down by Tindall, .J, as he
then
was, in
Young v Land Values Ltd.,
1924 W.L.D. 216
at pp.
224-225.
(d)
In taking account of the nature of the required performance, with the
relevant difficulties,
obstacles and delays attendant thereon, the
Court should postulate reasonably prompt and appropriate action and
due diligence on
the part of the party obliged to perform.
(e)
In deciding upon the promptitude and diligence which was to be
expected
of the party obliged to perform, the Court must have regard
to the commercial and other interests of the other party to the
contract.
Although in a particular case it may prove impossible for
one of the parties to complete performance until after the lapse of a
very long time indeed, it does not necessarily follow that that very
long period constitutes a reasonable time which must elapse
before
cancellation is justified. The period necessary for
performance may be so unreasonably long in the light of
the other
party's interest that cancellation may be justified before that
period has expired.”
49.
The
following dictum appears in
Cardoso
v Tuckers Land and Development Corporation (Pty) Ltd
1981 (3) SA 54
(W) at 67A-C:
“
From the passages cited above I
derive the following principles which, in my view, should be applied
in order to determine whether
a reasonable time for the fulfilment of
the suspensive condition in the contract has elapsed.
(1)
Each case must depend upon its own peculiar circumstances.
(2)
Important factors to be borne in mind are
(a)
the contemplation of each of the parties at the time of entering into
the contract;
and
(b)
the commercial interests of each of the parties.
(3)
As regards (a) above, however, the test is not solely subjective. An
objective test
must also be applied. In other words, although one of
the parties may in fact not have contemplated any particular
difficulty or
cause of delay that might or did arise, if it was
reasonably foreseeable it must be taken into account.”
50.
The
Nels did not controvert Mr Cooper’s testimony on the
reasonableness of the purchase price in respect of which the
plaintiff’s
property was placed on the market. Mr Nel conceded
under cross-examination that he did not have facts to substantiate
that the
purchase price was set high. Regard being had to the
evidence, prior to February 2008, the plaintiff’s house was on
the market
for approximately six months. The Nels did not tender any
evidence on their pleaded economic downturn during the period the
property
was placed on the market. Save to state that the period was
unreasonable to lead to the perfection of the sale of the house in
Jeffereys Bay, the Nels did not adduce evidence to rationally
demonstrate that the period was inadequate.
51.
The
plaintiff’s commercial position was sketched out earlier. To
sum it up, she paid the full purchase price for the movable
assets
and the business rights in the restaurant. She borrowed R200 000.00
from her flexi-reserve, R115 000.00 from her son
and also paid the
Nels a monthly occupational rent of R4 000.00 for the
restaurant. She was not receiving any rental from
her house as she
had requested her lessees to vacate the property so as to increase
its sale prospects. She had to pay off her
increased bond repayments
in the amount of R4000.00 including municipal services for her house.
To this must be added that the
plaintiff was also obliged, in terms
of the contracts, to pay all costs pertaining to the drafting of the
contracts and all the
attendances on an attorney and client scale. In
these circumstances it could not have been expected of the plaintiff
to carry on
with the contract in perpetuity until the sale was
perfected. On the other hand the Nels’ commercial interest is
somewhat
unclear. What one gathers from the plaintiff’s
testimony is that they intended to buy a house.
52.
In
Melamed
and Another v BP Southern Africa (Pty) Ltd
2000 (2) SA 614
(W) at 625E-G the Court held:
“
The agreement under
consideration is subject to a suspensive condition. This entails that
the agreement would be discharged
ipso
iure
on non-fulfilment of
the condition (
Dirk Fourie
Trust v Gerber
1986 (1) SA
763
(A) at 773F--G;
Design
and Planning Service v Kruger
[1974 (1) SA 689
(T)] (supra at 697G--H)). In
Tuckers
Land and Development Corporation (Pty) Ltd v Strydom
[1984 (1) SA 1
(A)] (supra at 23H) Joubert JA said:
'By nie-vervulling van
die opskortende voorwaarde, wat nie aan die toedoen van die partye te
wyte is nie, veral die koop/verkoop.'
Where a suspensive condition is not
fulfilled, a party who remains owner of the property sold may rely on
his remedies qua owner
and claim eviction of the party in possession
(for example
Meyer v Barnardo and Another
1984 (2) SA 580
(N)). Where there has been performance pursuant to a contract subject
to a suspensive condition
pendente conditione
the parties must
restore that which they have received
pendente conditione
or
conditione extincta
. The authorities seem to indicate that
restoration can be claimed with one or other of the enrichment
remedies.”
53.
Regard
being had to the weaker bargaining power of the plaintiff at the time
of transacting with the Nels as well her commercial
position
following the conclusion of the contracts I am not persuaded that the
period that lapsed was unreasonable for the fulfilment
of the
suspensive condition.
It follows that the
agreement was properly discharged. On the conclusion I have reached
it is not necessary to deal with the claim
for rectification or
enrichment.
THE COUNTERCLAIM:
54.
The
Nels’ counterclaim is provisional in nature and rested solely
on the success of the plaintiff’s claim in that, they
contended, it would not have been necessary to determine it had the
plaintiff’s claim failed because the
status
quo
prior to February 2008 would prevail. In their counterclaim the
Nels claim restitution of a reasonable and fair value of
the goodwill
of the restaurant in the amount of R360 000.00; delivery of
their antique water tank which was removed by the
plaintiff or not
returned by her; alternatively the reasonable and fair replacement
value of the historic tank in the amount of
R8000.00; and restoration
of the reasonable and fair net income of the restaurant from November
2007 to February 2008 calculated
and based on the average net income
earned in the preceding years in the amount of R68 835.00 which
they stated would be proved
by means of oral and documentary
evidence.
55.
In
terms of Rule 35(3) of the Uniform Rules the plaintiff requested the
Nels to produce the yearly financial statements of CJ’s
Restaurant for the period 28 February 2005, 2006, 2007, and 2008; the
provisional and final tax returns for these period; the VAT
returns;
the particulars of employees remuneration; the IRP 5 and IT3
reconciliations, detailed ledger, detailed income statement
and about
20 further like financial documents for inspection as envisaged in
Rule 35(6) or to declare under oath that they were
not in possession
of same in which event to indicate their whereabouts. In response the
Nels stated that they were not in possession
of these documents
because they were destroyed in a hailstorm during 2009. During Mr
Nel’s cross-examination he acknowledged
that some of this
information could have been retrieved from the South African Revenue
Service.
56.
It
is as well to remember that Mr Nel had testified that his
restaurant’s average income was in the region of R60 000.00
and R90 000.00 during January and December. When confronted
under cross-examination that in his pleadings he had averred that
his
income during the December 2007 was R36 000.00 he had no choice
but to concede that he plucked the figures in vacuum.
In essence, no
evidence in any form was adduced by the Nels to prove their purported
loss of income. As for the antique water tank,
Mr Nel could not
recall if he had ever informed the plaintiff to look after it.
57.
The
only argument tendered by the Nels in respect of their counterclaim
is that although their movable assets were returned the
plaintiff
failed to prove that she restored the goodwill to them. By Mr Nel’s
own admission they sold the business rights
and movable assets to the
plaintiff for an amount of R315 000.00 and received the full
purchase price from the plaintiff in
respect thereof which they are
still holding on to or have spent. Mr Nel could not say on what basis
they still required the plaintiff
to pay the goodwill for the
restaurant.
Unquestionably,
the Nels have failed to proof their counterclaim and it stands to be
dismissed.
THE
COSTS:
58.
I
now turn to the issue of costs. Mr Claasen argued that the Court
should mark its displeasure by means of a punitive costs order
against the Nels. He described the conduct of the Nels and their
attorney as improper, dishonest and unconscionable particularly
in
view of the letter dated 18 June 2008 which they directed to the
plaintiff’s attorney wherein they recorded that the plaintiff
restored the restaurant under a different name; did not sell
traditional pizzas; had fired personnel and appointed new employees;
that she removed her house from the market and had not mandated the
estate agents to sell the house as promised. This was so, he
contended, because the evidence demonstrated these allegations to be
a fabrication.
59.
In
further motivating a prayer for costs on the punitive scale Mr
Claasen argued that the Nels’ defences and their counterclaim
was a complete fabrication intended to frustrate the proceedings
and/or the plaintiff in the hope that she would abandon her claim.
He
argued that the Nels had no
bona
fide
intention to proof any of the defences they raised or the spurious
allegations encapsulated in their provisional counterclaim.
These
actions, he contended, smacks of dishonesty towards the Court and the
plaintiff and should not be countenanced.
60.
In
respect of the Nels’ amendment to their plea, which was
effected when this trial was underway and had the effect of rendering
the plaintiff’s enrichment claim moot, referred to earlier, Mr
Claasen suggested that the conduct of the Nels and their legal
team
of the time required the attention of the Law Society and the Bar
Council.
61.
In
my view, the few instances of the apparent breach of professional
etiquette referred to by Mr Claasen, if proved to be true,
ought to
be severely deprecated and discouraged. The duties and functions of a
legal representative who pleads his client’s
case were
expressed as follows in
Hallowes
v The Yacht Sweet Waters
1995 (2) SA 270
(D) at 277A-D.
“
In the first place, of course,
he is there to put forward the case of the person whom he represents
with such vigour and ability
as he has at his disposal. In our
sophisticated system of court procedure, however, his approach and
attitude cannot be exclusively
subjective. Secondly, he is required
to communicate and discuss the matter with the representative of his
opponent for the simple
purpose of eliminating disputes which are not
material, ascertaining that which is, in fact, common cause between
the parties and,
last but by no means least, endeavouring to achieve
a compromise of the dispute where such compromise can be effected
without an
inordinate measure of capitulation. Thirdly, he has a duty
to deal frankly and candidly with the court. Without these three
functions
being properly performed by any person who purports to
appear before the court in a representative capacity, there must
always
be a tangible danger of a failure of justice.”
62.
The
following passage appears in
AC
Cilliers on Law of Costs 4-14 para 4.09:
“
In
Van
Wyk v Millington
[1948 (1)
SA 1205(C)]
it was pointed out that the court’s reluctance to
award attorney and client costs against a party is based on the right
of
every person to bring his complaints or his alleged wrongs before
the court to get a decision, and he should not be penalised if
he is
misguided in bringing a hopeless case before the court. If, however,
the court is satisfied that there is an absence of
bona
fides
in bringing or
defending an action it will not hesitate to award attorney and client
costs.”
63.
As
was observed in
Waar
v Louw
1977 (3) SA 297
(O), the administration of justice is sometimes an
irritating discipline where even the most skilful practitioners can
make mistakes
which cause unnecessary costs. All things considered I
am not swayed that the Nels acted
mala
fide
in
defending their case to the extent which warrants an award of costs
on the harsher scale. In my view, the costs should follow
the success
in the ordinary party and party scale.
64.
In the
result the following order is made:
ORDER:
1.
Judgment is
granted against Mr Johannes Christiaan Nel and Ms Ella Dorathea Maria
Nel, the first and second defendants, for the
payment of an amount of
R315 000.00 (three hundred and fifteen thousand rand).
2.
Interest on
the aforesaid sum at the rate of 15.5 % per annum as from 01 March
2008 to date of final payment: provided that the
interest does not
exceed the capital sum of R315 000.00.
3.
The first
and second defendants’ counterclaim is dismissed with costs.
4.
The first
and second defendants are to pay the plaintiff’s costs of suit
on party and party scale,
jointly
and severally, the one paying the other to be absolved.
PHATSHOANE
J
NORTHERN
CAPE DIVISION
On behalf of the Plaintiff
Adv J.Y Claasen SC
Instructed by
Duncan & Rothman
On behalf of the Defendants
Adv H.J Benade
Instructed by
Haarhoffs Inc