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[2012] ZAKZPHC 25
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Evans v Tony de Jong Properties (7937/09) [2012] ZAKZPHC 25 (24 April 2012)
IN
THE KWAZULU-NATAL HIGH COURT, PIETERMARITZBURG
(REPUBLIC
OF SOUTH AFRICA)
CASE NO. 7937/09
In
the matter between:
GLYN
EVANS
….........................................................................................................
Plaintiff
and
TONY
DE JONG PROPERTIES
…........................................................................
Defendant
______________________________________________________________________
J U D G M E N T
______________________________________________________________________
KOEN
J
:
INTRODUCTION:
[1] The plaintiff claims
payment of the sum of R690 700,90 together with
mora
interest thereon and
costs, being a share of estate agent’s commission alleged to be
due to him on the sale of certain properties
owned by the De Billot
Family Trust (‘the trust’) to the Department of Land
Affairs (‘the DLA’).
1
THE PLAINTIFF’S
CONTENTIONS
:
[2] The plaintiff avers
that:
(a) on or about 24
November 2008 he and Mr De Jong,
the
sole proprietor of the defendant,
2
concluded a partly
written partly oral agreement in terms of which they agreed to share
commission earned from the sale of the properties
by the trust to the
DLA equally between them,
3
(b) by virtue of the sale
of the properties of the trust to the DLA and the terms of the
agreement concluded between them,
commission
in the sum of R690 700,90 accordingly became payable to him.
THE DEFENDANT’S
DEFENCE
:
[3] The defendant admits
the aforesaid terms of the agreement relied upon by the plaintiff.
The defendant however pleads that he
is excused from making payment
of the amount claimed because of the following:
(a) Prior to the
conclusion of the agreement, the plaintiff, with the intention of
inducing the defendant to conclude the agreement
on the terms that he
did, orally represented to him that the plaintiff had a sole mandate
to sell the trust’s properties
which were sold to the DLA, and
relying on the truth of that representation, the defendant concluded
the agreement. As the representation
was false, it being alleged that
the plaintiff had no mandate to sell the trust’s properties or
that the plaintiff did not
have a sole mandate to sell the trust’s
properties, the defendant claims that it was entitled to cancel the
agreement, which
it did on 10 June 2009; alternatively;
(b) Prior to the sale of
the trust’s properties, the plaintiff informed the defendant
that he had a sole mandate to sell one
of the trust’s
properties, at the same time authorizing the defendant to attempt to
find a buyer for that property. A number
of the trust’s
properties (not only the one referred to above) were subsequently
sold to the DLA with the defendant being
the effective cause thereof.
After the trust’s properties had been sold, the agreement
relied upon by the plaintiff was concluded.
At the time that the
agreement was concluded, the plaintiff was aware that the defendant
was still under the impression that the
plaintiff had a sole mandate
to sell the trust’s property. Accordingly, the plaintiff had a
duty to inform the defendant
that the representation previously made
by him was false, but despite this duty, the plaintiff intentionally
failed so to inform
the defendant. Thus the defendant became entitled
to cancel the agreement and did so on 10 June 2009.
(c) Alternatively, the
defendant relied on an alleged repudiation of the agreement by the
plaintiff having on 25 November 2008 advised
the defendant,
represented by his wife Joanita De Jong, that the agreement regarding
the split in commission was null and void,
which repudiation the
defendant accepted and pursuant to which it cancelled the agreement
on 10 June 2009.
DUTY TO BEGIN AND ONUS
OF PROOF
:
[4] Based on the
aforesaid respective contentions, the defendant rightly assumed the
duty to begin and the onus of proof.
CHRONOLOGY OF MATERIAL
EVENTS IN THE EVIDENCE
:
[5] I do not intend
summarizing all the evidence, but will only refer to the evidence
relevant to material events. These events
must be viewed against the
facts which became common cause, or which were not disputed. They
include:
(a) The plaintiff did not
have a sole mandate in respect of any of the trust’s
properties;
(b) The defendant indeed
received the commission payable to it on the sale of the trust’s
properties;
(c) One half of the
commission received by the defendant amounts to R690 700,90.
[6] The plaintiff met Mr
de Jong for the first time during or about October 2006 at the Argyle
Hotel, in Mooi River when he was
introduced by a Mr John Summerfield
who had told the plaintiff that Mr de Jong had experience in dealing
with sales of land to
the DLA, and that he ‘would do deals on a
50:50 commission split’, which the plaintiff understood to
mean, that to
facilitate a smooth sale by ensuring compliance with
the requirements of the DLA and liaising with its relevant officials,
the
defendant would require payment of 50 percent of the commission
on the transaction. The plaintiff maintains that he and Mr De Jong
there agreed that on all such future transactions involving sales to
the DLA and referred by the plaintiff to the defendant, the
commission would be shared equally. It is of course not the agreement
relied upon by the plaintiff in his pleadings. This allegation
is
furthermore disputed by the defendant, who contends that he agreed to
the 50:50 split on the basis of that being the norm in
the industry
where an agent who holds a sole mandate in respect of property,
refers it to another agent for sale and a sale is
concluded.
[7] During November 2006
the plaintiff and Mr De Jong met in the Hilton Remax offices. The
plaintiff places this meeting later,
somewhere during December 2006.
The defendant maintains that it was at this meeting that the
plaintiff offered the trust’s
properties to him to sell. It
seems clear that this could however not have related to all the
trust’s properties, as at that
stage, and this is not disputed,
only one farm of the trust was for sale, namely the one commonly
referred to as Sugar Haven. The
defendant states that the plaintiff
said that he had a sole mandate in respect of the trust’s
properties. On probability,
as it was only the farm Sugar Haven that
was for sale at that time, the misrepresentation, if it was in fact
made, could at best
extend to that farm only. The plaintiff denies
that he said that he held a sole mandate. The plaintiff’s
version that he
did not hold a sole mandate in respect of any of the
trust’s properties is supported by the ‘Detailed listing’
which appears at exhibit ‘A’ page 14, which records the
mandate as being an ‘open listing’. He states that
it was
at that meeting that it was confirmed that he would ‘bring the
farms and Mr De Jong his expertise and the commission
would be split
50:50’. According to him the referral of Sugar Haven was not
discussed at that meeting. The plaintiff’s
version is that it
was only over the Christmas break that he thought that the trust
might sell to the DLA. He phoned Rodger de
Billot who represented the
trust and told him that he knew of an expert to facilitate such a
sale and enquired what he thought
about that. Mr De Billot replied
that he would talk to the other family members and bring them to a
meeting which the plaintiff
said occurred mid January 2007.
[8] At that stage the De
Billots and their trust were cash strapped and required funds. They
were interested only in selling Sugar
Haven, as they believed it to
be free of land claims, whereas the other properties all had other
land claims on them. As it turned
out however Sugar Haven also had a
land claim on it.
[9] Mr De Jong met the
Plaintiff and
inter alia
some of the De Billot family members
during mid January 2007 and it was discussed that attempts would be
made to sell Sugar Haven
to the DLA. At that stage the De Billot
family did not want to sell all the other properties of the trust as
well.
[10] On 31 January 2007
inter alia
the plaintiff and Mr De Jong and his wife met the
De Billots at the offices of the De Billot’s attorneys, A P
Austen Smith.
It is the defendant’s case that at this meeting
the plaintiff allegedly repeated the statement that he held a sole
mandate.
In support of this contention the defendant relies on brief
notes of that meeting recorded by Mrs De Jong, which records the
plaintiff
as having explained that ‘Remax sole mandate not less
than 5%’. The explanation by the plaintiff of this evidence is
that he had said, that in any mandate Remax would try and get not
less than 5 percent. He stated that to best of his knowledge
there
was no discussion regarding any sole mandate. What does however
appear as being common cause, arising from that meeting,
is that
before any sale could proceed to the DLA a ‘mandate’ of
some sorts was required, whether a mandate to sell
the property or to
proceed with the necessary valuations and other preliminary
requirement s the DLA might have..
[11] In a letter from the
De Billot’s attorneys to plaintiff dated 1 February 2007, a Mr
Brett Austen Smith records that:
‘
I confirm that Roger Debillot
has indicated that the Debillot group may wish to sell various
Properties as follows:
“
1. Sugar Haven (as a stand
alone farm) – at a gross selling price (including any
commissions payable) of R7,5 million. This
selling price excludes any
equipment.
2. The entire operation, consisting of
five farms and all machinery owned by the Debillot group at a price
or R43 million including
all commissions.
Please be advised that the above
information provided by Roger Debillot is merely an indication of the
Groups’ possible intention
to sell the Properties, and the
prices mentioned herein, are indications of Rodgers estimates of
value. The statements made by
Roger Debillot do not constitute a
formal mandate.
The members of the De Billot group are
meeting at our offices on 2nd February 2007 to discuss the Group
structure and possible sale
of one or more farms. It is anticipated
that a final decision will be made and that we will be in a position
to issue a formal
mandate after the meeting.’
[12] On 4 February 2007
Mr Austen Smith addressed a letter to the DLA, referring to a
telephone conversation allegedly with Mrs
Mashoko of that department
and recording:
‘
As discussed, the De Billot
Group have offered the following properties for sale to the
Department of Land Affairs. Tony de Jong
Properties are facilitating
the sale on behalf of the De Billot group . The properties offered
are described as:
Sub 1 of Springkloof Farm Number
13477, known to us as the farm “Chingford” in extent
366, 8096 hectares.
Sub 2 of Springkloof Farm Number
13477, known to us as the farm “Fairview” in extent
366,8093 hectares.
Sub 3 of Springkloof Farm Number
13477, known to us as the farm “Solitude” in extent
366, 8093 hectares.
Rem of Picklesvale Farm Number 14689,
known to us as the farm “Sugar Haven” in extent 328,5010
hectares.
Rem of Springkloof Farm Number 13477,
known to as the farm “Spring Valley” in extent 351,1638
hectares.
The nature of my enquiry is to obtain
some form of documentation from the DLA addressed to the De Billot
Group informing the De
Billot Group that the properties have been
offered for sale to the DLA and that the DLA is in the process of
evaluating the properties.
This information is required by the De
Billot group to facilitate negotiations with other interested
parties.
We are fully aware that any
documentation from the DLA does not constitute any form or offer or
expression of interest in the properties,
but is merely confirmation
that the properties have been offered and that the DLA may consider
the possibility of purchase.
Equally this letter does not
constitute any mandate, instead, the formal mandate has been given to
Tony De Jong Properties.’
[13]
The contents of the aforesaid letters were not challenged.
[14] From that time the
plaintiff’s involvement was limited. The reasons therefore are
not strictly relevant to this judgment.
The plaintiff states that he
was asked by the defendant to limit his involvement, whereas the
defendant maintains that the plaintiff
played no effectual role in
concluding the sales of the trust’s properties thereafter. The
plaintiff accepts that the defendant
thereafter did the bulk of the
work relating to procuring valuators being sent out to undertake
valuations etc.
[15] In a letter dated 20
February 2007, the trustees of the trust instructed the defendant as
follows:
‘
We, the undersigned, hereby
instruct Tony De Jong Properties as the selling agent to offer the
following properties for sale to
the Department of Land Affairs.
The property described as:
Rem of Picklesvale Farm number 14689,
known to us as the farm “Sugar Haven” in extent 328,5010
hectares.
The property has been offered to the
Department of Land Affairs at an asking price of
R6 950 000,00 (Six million nine
hundred and fifty thousand rand), excluding VAT. This price does not
include any equipment or machinery.
Any agent’s commission
payable to Tony De Jong or any other agent will be paid by the
Department of Land Affairs over and
above the asking price.
We acknowledge that the buyer, in the
event of the Tony De Jong Properties effecting a sale, will be the
Department of Land Affairs
Pietermaritzburg, who will undertake to
process any land claims after the sale.
We acknowledge that a successful sale
will involve a valuation of the property…
We undertake not to introduce the
property to the Department of Land Affairs through any other agent or
agency, however, we reserve
the right to the farm privately or
through an agent to any other party, until such date as a formal
agreement of sale is concluded
through your agency on terms and
conditions acceptable to us.’
[16] Although the
evidence was not clear on this, a decision was subsequently taken
that the entire farming operation of the trust
and its properties
would be sold.
[17] On 22 July 2008 an
agreement was concluded recorded which was on the De Billot Trust
letterhead addressed to the defendant
stating the following:
‘
22 July 2008
Tony
De Jong Properties
This letter is an agreement between
the De Billot Trust and Tony de Jong Properties in regard to the
commission to be paid to them
for the sale of the De Billot Trust
properties.
The De Billot Trust agrees to pay Tony
De Jong a commission of 2.8% plus vat on the sale price of R43 277
000,00.
Signed on behalf of the De Billot
Trust
Roger De Billot
Paul De Billot
Signed on behalf of Tony De Jong
Properties
Tony De Jong
Juanita De Jong’.
Mr De Jong testified that
he was at the time still under the impression that the sole mandate
which he contends the plaintiff said
he had, was still valid.
[18] During September
2008 a meeting was held attended by Mr John Humphries, the office
manager of Remax, the plaintiff and Mr de
Jong. The purpose of the
meeting, according to Mr De Jong, was to ‘get an agreement put
together in respect of the sole mandate
which the plaintiff had
raised’. He said that at that meeting the 50:50 percent split
was agreed. There were also other splits
in commission that were
agreed to relating to other properties referred to as Jennings,
Hilton Moor and Arlington. Mr Humphries
in his evidence stated that
at that meeting Mr De Jong objected to the 50:50 percent split
because of the amount of the work that
had been done by the
defendant, compared to that done by the plaintiff. These concerns
were allegedly addressed by the defendant
being included in other
deals which the plaintiff was working on. Mr Humphries confirmed the
50:50 apportionment of commission,
but said he did not know what
motivated that split.
[19] On 24 November 2008
a written agreement was concluded between the plaintiff and the
defendant recorded in the following terms:
‘
Agreement
between Glynn Evans and Tony De Jong
On the above sales, we the above
mentioned have agreed the following commission splits: -
De
Billot to Land Affairs 50% to Glynn Evans (Incl Bill Hasleau
R60000,00)
50%
to Tony De Jong
Jennings 75% to Glynn Evans
25% to Tony De Jong
Hilton Moore 75% to Glynn Evans
25% to Tony De Jong
Arlington 80% to Glynn Evans
20% to Tony De Jong.’
The
defendant testified that he at that time still thought that the
plaintiff held a sole mandate.
[20] By then the sales in
respect of the various properties of the trust to the DLA had been
finalized and the plaintiff congratulated
Mr De Jong on achieving
these sales. This evidence was not disputed.
[21] It was also on the
24
th
November 2008, or the next day, that the plaintiff
allegedly told the defendant’s wife that their deal on
commission was
null and void and would have to be renegotiated. The
plaintiff’s version on this is different. He testified that he
did telephone
on the 24
th
November 2008 but stated that he
would have to check with Remax, specifically Mr John Humphries
whether the agreement was valid
insofar as it might impact on the
rights of Remax, as he had not discussed the matter with him before
concluding the agreement
with the defendant. He went and saw Mr John
Humphries, who however told him that as their agents worked for
themselves, the plaintiff
was at liberty to conclude such an
agreement. He maintained that he thereafter conveyed this to the De
Jongs.
THE MERITS
:
[22]
Mr Rall SC
for the defendant, quite correctly, states that in order to succeed
with his defence to the plaintiff’s claim, the defendant
must
prove:
(a) That there was a statement by the
plaintiff about a sole mandate in respect of the De Billot properties
when the introduction
to the defendant took place;
(b) That by November 2008, the
defendant was still under that belief and that it applied to all the
properties of the trust.
[23] It is improbable
that the plaintiff would have offered all the trust’s
properties to the defendant for sale, as a referral,
as a sole agent,
during November 2006, as the trust was at that stage not interested
in selling all the trust’s properties,
but was only looking at
the possible sale of Sugar Haven. Indeed, until the letter from AP
Austen Smith dated 20 February 2007,
although consideration had by
then been given to possibly selling the other properties of the trust
as well, any mandate could
only have been in respect of Sugar Haven.
The misrepresentation relied upon by the defendant set out in
paragraph 3(a) above accordingly
cannot be sustained.
[24] Even if the
plaintiff,
due
to inexperience or mistaken impression of what the ‘exclusive
mandate’ granted by Panache to Mr Bill Haselau of
Remax might
have entailed, possibly referred to his mandate as a ‘sole
mandate’, and accepting in favour of the defendant
that there
was a reference to ‘sole mandate’ at the meeting held at
the offices of A P Austen Smith on 31 January 2007,
the defendant
could not, either because of the meeting with the De Billots during
mid January 2007 to discuss the sale of all the
properties, or in the
light of what was discussed at the meeting on 31 January 2007,
or the correspondence
received thereafter granting a mandate to the defendant as agent and
referring to commission payable,
4
have continued labouring
under any belief on 24 November 2008 that there was a sole mandate
granted by the trust to the plaintiff
in respect of all its
properties.
[25] It follows that the
defence of a misrepresentation referred to in paragraph 3(b) above
also cannot be sustained.
[26] At best for the
defendant, and accepting the defendant’s evidence, there might
have been a misrepresentation
5
in respect of Sugar
Haven.
[27] However,
by November 2008, it
cannot be said on the probabilities that the defendant was still
laboring under that belief. If the defendant
still believed that
there was a sole mandate, based on what was allegedly represented
during November 2006 to January 2007, then
in concluding the
commission deal with the trust dated 22 July 2008, the defendant
would expose his principal, the trust, to a
potential double
commission claim, at least in so far as Sugar Haven is concerned,
namely the commission payable to the defendant
in terms of the
agreement of 22 July 2008 and the commission which would be payable
to the plaintiff based on the alleged sole
mandate which the
defendant believed existed. It seems improbable that the defendant
would have acted in such a manner, if it believed
that a sole mandate
existed in respect of Sugar Haven.
[28] The defendant’s
experience that a 50:50 percent commission split generally applies in
respect of sole agencies, this
being the basis upon which the
commission on the sale of his parent’s property was dealt with,
would at first appear to support
his contention that his belief
throughout was that there was a sole mandate. However, although
disputed by Mr De Jong as being
an arrangement that would apply in
the future to all sales, the plaintiff’s version does offer an
alternative and more probable
basis on which the 50:50 percent
commission split is explained. Indeed Mrs De Jong testified that the
defendant was brought in
to conclude the deals with the DLA, as the
expert in that field.
[29] In the light of the
mandate at page 64 of exhibit ‘A’, granted, initially in
respect of Sugar Haven to the defendant
to sell that property to the
DLA, being really in the nature of a sole mandate (although it
reserved to the sellers the right to
sell to a private buyer), the
defendant could, in my view, have been left in no doubt that it was
now mandated to conclude the
deal with the DLA, and that this would
be in conflict with any sole mandate which might have existed in
respect of the property
or properties in favour of the
plaintiff/Remax. Hence, the defendant was no longer induced by and
could not rely on any suggestion
that he laboured under the belief
that there was a sole mandate in respect of the properties. The
conduct by the defendant thereafter
in negotiating commission
directly with the De Billots is also inconsistent with any notion of
a continued belief that the plaintiff
held a sole mandate.
[30] The defendant’s
defence that the reason for the 50:50 percent split in commission was
based on an alleged misrepresentation,
cannot be sustained. While the
final deal was concluded through the efforts of the defendant, the
fact remains that the defendant
was initially introduced to the De
Billots and the property the trust had for sale through the referral
by the plaintiff. This
was in any event not an issue in the trial.
That the defendant thereafter did the bulk of the work is irrelevant
to the issue of
the commission split.
[31] The defendant has
failed to discharge the onus of showing that any alleged
misrepresentation as to a sole mandate initially
made, was still
relied upon by him, and in fact induced the conclusion of the
agreement of 24 November 2008. In reaching that conclusion,
I have
given careful consideration to certain aspects of evidence of Mr De
Jong and Mrs De Jong not having been challenged by the
plaintiff and
being raised by the plaintiff for the first time when he gave
evidence. These however in my view relate mainly to
peripheral
issues, but even to the extent that they might not, they are not such
as to disturb the probabilities emerging on a
conspectus of all the
evidence.
[32] The defence of an
alleged repudiation of the agreement by the plaintiff was not pursued
with much vigour, in my view correctly
so. The evidence on this issue
is, at best for the defendant, ambivalent. The probabilities favour
the explanation by the plaintiff
that he was concerned as to whether
the agreement he concluded was in order and whether it might, or
might not, carry the approval
of his principal, Remax. In those
circumstances one would have expected him to have indicated that he
wanted to clear it with Remax,
which on his version he did.
THE ORDER
:
Judgment is granted in
favour of the Plaintiff against the defendant for:
Payment of the sum of
R690 700,90;
Interest thereon at the
rate of 15,5% p.a.
a tempora morae
from date of demand to
date of payment;
Costs of suit.
________________________________
DATE OF HEARING: 15 -
FEBRUARY 2012
DATE
OF JUDGMENT: 24 April 2012
PLAINTIFF’S
COUNSEL: ADV. R VAN ROOYEN
PLAINTIFF’S
ATTORNEYS: GDLK Inc
(Ref:
AJLG/dl/E253a)
Tel:
033 394 9091
DEFENDANT’S
COUNSEL: ADV. A RALL SC
DEFENDANT’S
ATTORNEYS: HEPBURN Inc
(Ref:
K. Hepburn/133D025001)
Tel:
033 345 5861
1
The
DLA was acquiring the property on behalf of the Masibuyela Emakhaya
Community Trust.
2
Mr
De Jong, the proprietor of the defendant and his firm, the
defendant, will for the sake of convenience both be referred to
simply as ‘the defendant’.
3
A
payment of R60 000 owing to one Bill Haselau would come out of the
Plaintiff’s share.
4
which
would go beyond merely a mandate to obtain valuations of properties
for possible sale to the DLA
5
Even
an innocent misrepresentation would suffice.