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[2013] ZAGPPHC 257
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General Food holdings (Pty) Ltd v Van Niekerk NO and Others (A707/10) [2013] ZAGPPHC 257 (28 August 2013)
NOT
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA NORTH GAUTENG HIGH COURT, PRETORIA
CASE
NO:A707/10
DATE:28/08/2013
In
the matter between:
GENERAL
FOOD HOLDINGS (PTY)
LTD
.........................................................
FIRST
APPELLANT
KAPAMA
GAME RESERVE (PTY)
LTD
......................................................
SECOND
APPELLANT
and
HENDRIK
CORNELIUS VAN NIEKERK
N.O.
................................................
FIRST
RESPONDENT
SUSANNA
SOPHIA VAN NIEKERK
N.O.
…............................................
SECOND
RESPONDENT
OCKIE
VAN NIEKERK
TRUST
........................................................................
THIRD
RESPONDENT
REGISTRAR
OF DEEDS,
PRETORIA
......................................................
FOURTH RESPONDENT
STEYN
& CLARKE
ATTORNEYS
…................................................................
FIFTH
RESPONDENT
JUDGMENT
VAN
OOSTEN J:
[1]
At issue in this appeal are the following two questions: firstly,
whether an agreement for the sale of land and a business was
lawfully
cancelled as a result of an alleged repudiation thereof and secondly,
whether the court a quo was empowered by way of
declaratory orders in
effect to interdict a party from instituting legal proceedings
against the other parties, prior to the institution
thereof. Based on
the factual matrix to which I shall presently revert, the court a quo
(Raulinga J) decided the first issue in
favour of the first appellant
and the second in favour of the first, second and third respondents.
The appeal before us is directed
firstly, by the first appellant,
with leave of the Supreme Court of Appeal, against the granting of
the relief concerning the second
question (paragraph 2 of the order
of the court a quo) and the costs order made (paragraph 3 of the
order), and secondly, by the
first second and third respondents by
way of cross-appeal against the orders granted concerning the first
question (paragraph 1
of the order).
[2]
The facts of the matter are these: The first and second appellants
are respectively the registered owner and managing company
of the
Kapama Private Game Reserve situated close to Hoedspruit, Limpopo
Province (Kapama). The shareholding in the two companies
is held by
trusts of which the Roode family are the beneficiaries. Kapama or as
it is aiso known Kapama Private Game Reserve is
an internationally
known nature reserve, lodge and spa situated on approximately 9,500
hectares. The third respondent trust of
which the first and second
respondents are the trustees (jointly referred to as ‘the
trust’) is the registered owner
of the immovable property which
is the subject matter of the litigation between the parties (the
trust property) which is and always
has been utilised as an
irrigation farm by the Van Niekerk family. The trust property is not
only bordered Kapama Reserve but was
also surrounded by it. In 2007,
Mr Roode, on behalf of the first appellant, because of the ideal
location of the trust property
became interested in purchasing it for
purposes of expanding Kapama’s operations and for providing
additional accommodation
to meet the expected therefore during the
2010 Soccer World Cup. Protracted negotiations between Roode and the
first respondent
ensued eventually culminating in the conclusion on 2
July 2008 of a written agreement of sale of the trust property and
the business
conducted on the property for a purchase price of R6,5m
(the agreement). The parties duly fulfilled all their obligations in
terms
of the agreement and the transfer documents for the
registration of the trust property in the name of the first appellant
were
lodged with the Registrar of Deeds.
[3]
While transfer was pending Roode was made aware of the existence of
restrictive conditions in favour of a neighbouring property,
Gwala-Gwala, registered against the title deed of the trust property
in terms of a notarial deed of restrictive conditions, registered
over the trust’s property in favour of a neighbouring property,
Gwala-Gwala. The restrictive notarial conditions were granted
by the
trust in August 2002 and provided for a prohibition against the use
of the trust property for any commercial development.
Roode was
unaware of the existence of the restrictive conditions and
immediately raised concern as it obviously thwarted Kapama’s
intended use of the trust property in particular to erect a game
lodge on the trust property. Extensive correspondence between
the
respective attorneys acting for the parties concerning this issue
followed. Kapama adopted the view that the existence of the
restrictive conditions should have been disclosed to Roode during the
negotiations prior to the conclusion of the agreement which
the trust
denied. Notwithstanding the alleged non-disclosure and
misrepresentation with which Kapama was confronted it decided
to
abide the agreement but reserved its right to ‘should it decide
to do so at a later stage, claim a price reduction and/or
damages
from the trust’ (Kapama’s claim). In this regard it was
conveyed to the trust that ‘Ons wil dit egter
duidelik stel dat
in geval waar ons klient wel oordrag neem, General Food Holdings
(Eiendoms) Beperk se regte om 'n gedeelte van
die koopprys en/of
skadevergoeding te vorder, voorbehou word. In so gevai sal ons van u
klient ‘n onderneming verlang om
R2m in u trustrekening na
oordrag te behou, hangende die bepaling van die waarde van die
eiendom met die beperkende voorwaarde
daarop van toepassing.’
In
the response hereto the trust’s attorneys cancelled the
agreement on the ground that Kapama had indicated that it was not
prepared to unconditionally pay the full purchase price of the trust
property and the pending registration process was terminated.
Kapama’s attorneys in their response reiterated that they had
merely conveyed proposals concerning the possible claim for
damages
and that the transfer of the property would be taken subject to
Kapama’s claim. It is only then that the trust’s
attorneys mentioned repudiation, as follows:
Mndien
u klient (Kapama) inderdaad staan by sy standpunt dat ons klient
wanvoorstelling gepleeg het, wil dit voorkom asof die noodwendige
afleiding moet wees dat u klient die ooreenkoms repudieer.’
The
alleged repudiation was accepted by the trust and the agreement was
once again cancelled. The deadlock that arose prompted the
application being launched in the court a quo.
[4]
In the application the relief sought by Kapama was aimed at
compelling the trust to cause transfer of the trust property into
its
name. The trust opposed the application and instituted a conditional
counter-application for a declarator that, firstly, the
restrictive
conditions did not constitute a latent defect in respect of the
purchase of the trust’s property and business,
secondly, that
Kapama was not entitled to ‘any price reduction of any nature1,
and, thirdly, that the trust had no legal
duty during the
negotiations prior to the conclusion of the agreement, to disclose to
Kapama the existence of the restrictive conditions.
Having heard
argument the relief sought in both the application and
counterapplication was granted by the court a quo and
the first
appellant was ordered to pay the costs of both the application and
the counter-application. The appeal accordingly, in
effect is against
the whole of the judgment of and orders made by the court a quo.
[5]
At the commencement of the hearing of the appeal counsel informed us
that transfer of the trust property into the name of Kapama
was
effected as far back as on 5 November 2009. In view hereof the
cross-appeal has been rendered moot, except for the costs order
made
against Kapama. Arguments were accordingly presented on the merits of
the cross-appeal for the purpose of determining the
costs liability,
which I now turn to deal with.
[6]
The notice of cross appeal was filed on 30 June 2010 which was some
seven months after the transfer of the trust property when
the issues
raised in the notice, except for costs order, were no longer alive.
In view of the arguments presented I consider it
prudent to briefly
express my views on the merits of the cross-appeal. In this regard
only one issue needs to be addressed which
is whether Kapama in fact
committed an act of repudiation. It is trite that an act of
repudiation exists where the conduct of a
contacting party exhibits a
deliberate and unequivocal intention no longer to be bound by the
agreement (Christie The Law of Contract
in South Africa 6th ed p
538). The conduct on behalf of Kapama relied on by the trust for
constituting repudiation consists of
statements made in the
correspondence I have already referred to, after Kapama’s
discovery of the restrictive conditions.
The stance taken on behalf
of the trust in the correspondence, as it inter alia appears form the
letter quoted above, was that
Kapama’s insistence that a
misrepresentation constituted a repudiation of the agreement. The
contention was wisely not persisted
with either in the court a quo or
on appeal. Counsel for the trust sought to find an act of repudiation
in Kapama’s claim,
which it should be remembered was merely
contemplated. A close examination of the correspondence however
reveals the opposite.
From the correspondence I have already referred
to, it is apparent that Kapama at all times insisted on transfer of
the trust property
but that proposals were made to facilitate their
claim. Kapama’s conduct, in my view, is only consistent with an
intention
to abide the agreement. The reservation of Kapama’s
claim was not only legally competent but also in no way inconsistent
with an intention to be bound by the agreement. Put differently,
there is nothing to show that there was any conduct by Kapama to
evade or deny the validity or continuation of the agreement. The
learned Judge a quo accordingly correctly found that no repudiation
had been shown and that Kapama accordingly was entitled to specific
performance. For these reasons there was no merit in the
cross-appeal.
[7]
The court a quo’s costs order remains to be considered. The
learned Judge a quo ordered Kapama to pay the costs of the
application on the basis that it had dragged the trust to court,
after it had purchased the Gwala-Gwala property, which he held
would
‘automatically’ have discharged the restrictive
conditions. ! am unable to agree. The trust, although being aware
of
the Gwala-Gwala transaction, since this was raised in the papers in
the application, at no stage tendered transfer of the trust
property
to Kapama. On the contrary, the trust persisted with their opposition
to the application and filed a cross-appeal. Kapama,
in my view with
ample justification, launched and pursued the
application
and the normal rule of the successful party being entitled to costs
accordingly should follow.
[8]
This brings me to the appeal which concerns the orders made by the
court a quo in upholding the trust’s counter-application.
The
learned Judge a quo granted the relief sought in the
counter-application simply on the basis that the trust ‘should
be protected from any further action' by Kapama for damages which
also happened to be the basis on which the relief was sought by
the
trust. I am unable to align myself with the reasoning of the court a
quo. Although counsel for the trust vigorously defended
the findings
made by the court a quo, he was eventually driven to concede that at
least as far as prayer 2 of the counter-application
is concerned, the
proverbial doors of the court were closed to Kapama to pursue those
aspects in a court of law. For this reason
alone the orders made by
the court quo in the counter-application cannot stand. The notion of
effectively denying a party, by way
of a declarator, access to court
to claim relief prior to institution thereof, in my view, cannot pass
constitutional muster and
therefore cannot be countenanced.
[9]
Counsel for the trust however had another string to his bow: relying
on the "once and for all” rule, he submitted
that Kapama
should have raised all issues in the application and that it
accordingly should not be allowed to institute fresh proceedings
in
respect of the proposed claim for reduction or damages. In support of
the contention counsel placed reliance on the judgment
of Heher JA in
Janse van Rensburg and others NNO v Steen kamp and another; Janse van
Rensburg NNO and others v My burgh and others
2010 (1) SA 649
(SCA)
660B-G. The case does not support counsel’s contention. The
learned Judge of Appeal in dealing with the scope of the
‘once
and for all’ rule held that the ratio for the rule is to avoid
an abuse of process when the same cause of action
is raised against
the defendant a second time. Applied to the facts of this matter
there can be no doubt that a duplication of
causes of action by
Kapama pursuing their claim will not arise: the cause or causes of
action on which Kapama’s claim will
be based, although having
their foundation in the agreement, are entirely different and indeed
need to be distinguished from the
claim in the application, which was
for specific performance. Added hereto are the considerations that
the counter-application
only emerged in the answering affidavit and
the usual restrictions that apply to motion proceedings, all of which
militate against
upholding the contention raised by counsel for the
trust which accordingly falls to be rejected.
[10]
I have accordingly come to the conclusion that the
counter-application was wrongly granted. It ought to be set aside.
Kapama,
being the successful party, is entitled to the costs of the
counter-application both in the court a quo and on appeal.
[11]
In the result I make the following order:
1.The
appeal against paragraphs 2 and 3 of the order of the court a quo is
upheld.
2.
Paragraphs 2 and 3 of the order of the court a quo are set aside and
substituted with the following:
2.1
The first, second and third respondents’ counter-application is
dismissed.
2.2The
first, second and third respondents are ordered to pay the costs of
the application and the counter-application.
3.
The first, second and third respondents are ordered to pay the costs
of the appeal and the cross-appeal.
FHD
VAN OOSTEN
JUDGE
OF THE HIGH COURT
I
agree.
HJ DE VOS
JUDGE
OF THE HIGH COURT
I
agree.
N KOLLAPEN
JUDGE
OF THE HIGH COURT
COUNSEL
FOR APPELLANTS: ADV JP VAN DEN BERG
APPELLANTS’
A TTORNEYS: GROSSKOPF A TTORNEYS
COUNSEL
FOR FIRST SECOND
AND
THIRD RESPONDENTS: ADV R DU PLESSIS SC FIRST SECOND AND THIRD
RESPONDENTS’
A TTORNEYS: STEYN & CLARKE A TTORNEYS
DATE
OF HEARING: 21 AUGUST 2013
DATE
OF JUDGMENT: 28 AUGUST 2013