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[2011] ZAFSHC 47
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Lategan and Another v Leslie Mildenhall Trollip t/a Property Solutions (A297/10) [2011] ZAFSHC 47 (10 March 2011)
FREE STATE HIGH
COURT, BLOEMFONTEIN
REPUBLIC OF SOUTH
AFRICA
Appeal No. : A297/10
In
the appeal between:-
JOHANNES STEPHANUS
LATEGAN
…..........................
First
Appellant
MARLET
LATEGAN
….................................................
Second
Appellant
and
LESLIE
MILDENHALL TROLLIP
t/a PROPERTY SOLUTIONS
…..........................................
Respondent
_____________________________________________________
CORAM:
HANCKE, J
et
FISCHER, AJ
_____________________________________________________
HEARD
ON:
7 MARCH 2011
_____________________________________________________
JUDGMENT BY:
FISCHER, AJ
_____________________________________________________
DELIVERED ON:
10 MARCH 2011
_____________________________________________________
[1] The respondent, an
estate agent who at all relevant times was the holder of a Fidelity
Fund Certificate as envisaged in terms
of section 26 of Act 112 of
1976 issued summons against the appellants claiming commission in the
sum of R16 000,00 premised on
the alleged failure by the appellants
to comply with clause 2 of an Agreement of Sale concluded between the
appellants as purchasers
and a certain Johanna Fabel as seller, it
being common cause that the respondent was a party to such agreement.
The appellants
pleaded that respondent was not entitled to the
commission claimed, due to the fact that clause 2 of the Agreement of
Sale contained
a suspensive condition that had not been fulfilled.
The Court
a quo
found in favour of the respondent pursuant to
which the appellants initiated the appeal procedure by requesting
written reasons.
What followed was a whole series of delays which
were subsequently dealt with in no less than two Applications for
Condonation,
firstly, in respect of the late filing of the Notice of
Appeal and secondly, in respect of the prosecution thereof as
envisaged
in terms of High Court Rule 50(1) and (4).
[2] It is trite that a
Court of Appeal has a discretion to grant an extension of time for
the noting or prosecuting of an appeal
as well as to condone
non-compliance with the Rules of the High Court.
See:
BELO v COMMISSIONER OF CHILD WELFARE, JOHANNESBURG
[2002] 3 ALL SA 286
(W) at 290 C – D and High Court Rule 27(3)
and 49(6)(b).
The principles upon which
a Court of Appeal will exercise such discretion in granting
condonation need not be restated for purposes
hereof, but see in
general
UNITED PLANT HIRE (PTY) LTD v HILLS AND OTHERS
1976 (1) SA 717
(A) at 720 E – G.
[3] It is incumbent upon
the appellants to give a full explanation for the delay and/or
failure, that there are reasonable prospects
of success and finally
that the present respondent will not be adversely affected by an
indulgence.
See:
VAN WYK v
UNITAS HOSPITAL AND ANOTHER (OPEN DEMOCRATIC ADVICE CENTRE AS AMICUS
CURIAE)
[2007] ZACC 24
;
2008 (2) SA 472
(CC) at 477 A – B;
IMMELMAN
v LOUBSER EN 'N ANDER
1974 (3) SA 816
(A) at 824 B – C
and
FINBRO FURNISHERS (PTY) LTD v REGISTRAR OF DEEDS,
BLOEMFONTEIN, AND OTHERS
1985 (4) SA 773
(A) at 790 C.
[4] I am satisfied that
not only have the appellants given a full and acceptable explanation
for the delay and failure, but have
furthermore shown that the
respondent will not be adversely affected thereby. In the
circumstances Mr. Buys for the appellants
was invited to address the
Court on the merits as the whole question relating to the prospects
of success are inextricably interwoven
with all relevant submissions
in respect of such merits.
[5] Mr. Buys (it being
common cause that Heads of Argument were belatedly filed on behalf of
the respondent, but with no appearance
by counsel) submitted that the
nub of the appeal centred around the question as to whether or not a
suspensive condition contained
in the relevant Agreement of Sale had
been deemed to have been fulfilled upon notification by a bank to the
appellants that the
loan in question had been approved regardless of
any conditions attaching to such approval. Clause 2 of the Agreement
of Sale to
which both the appellants, as well as the respondent, are
signatories, reads as follows:
“
2.
Bond
This sale is subject to the suspensive
condition that the
purchaser
is granted a loan in the sum of
R240 000 (two hundred and forty thousand rand) on or before 23
November 06 by a registered bank
upon its nominal terms and
conditions, such loan to be secured by a First Mortgage Bond to be
registered over the property simultaneously
with transfer. The
purchaser
shall take all necessary steps to secure the
granting of the loan within 3 (three) working days of the last
signature hereof. This
condition shall be deemed to have been
fulfilled upon notification by the bank to the
purchaser
or
his agent that the loan in question has been approved regardless of
any conditions attaching to such approval or attaching to
any loan
agreement between the
purchaser
and the bank...”
A proviso is contained
within the further provisions of clause 2 but is irrelevant for
purposes of this judgment.
[6] Clause 7 of the same
Agreement reads as follows:
“
7.
Commission
The Purchaser and Seller acknowledges
that
property solutions
introduced the Purchaser to the
property and have been the sole introductory agents and the effective
cause of the sale. The Seller
shall be liable for the Agents
Commission of R16 000 (sixteen thousand rand) which shall be deemed
to have been earned by the said
agent upon the acceptance of this
offer/or the fulfilment of any suspensive condition (if any).”
“
... If the
Purchaser or Seller fail to carry out either of their obligations
contained herein, the faulting party shall be liable
for the Agents
Commission.”
[7] It is clear from a
reading of clause 2 that the whole Sale Agreement and, as
importantly, the right to claim commission by respondent,
was subject
to a suspensive condition to the effect that the purchaser (
in
casu
the appellants) would be granted a loan for a specified some
of money by a registered bank upon such bank’s “
normal
terms and conditions
”. Clause 2 however goes further in
that it contains a deeming provision to the effect that the
suspensive condition would
be deemed to have been fulfilled upon the
mere notification by the bank to the purchaser that the loan in
question had been approved
“
regardless of any conditions
attaching to such approval or attaching to any loan agreement between
the purchaser and the bank
.”
[8] On 13 November 2006
the loan was allegedly approved by Absa Bank but made subject to two
special conditions, namely the settlement
of an existing loan
(thereby implying the sale of the appellants’ existing
property) and secondly, that the building of a
home on the property
in question was to be commenced with within six months after
registration of the Mortgage Bond. On 11 November
2006 the appellants
communicated by e-mail with the respondent raising therein the
aforementioned problems. On 13 November 2006
the respondent responded
in a further e-mail as follows with only the relevant portions
thereof referred to:
“
Ek kan nie
verstaan dat Absa verwag dat jy jou huis moet verkoop om ‘n
verband goed te keur om ‘n ander erf te koop.
... ek kan regtig nie die Absa bank se
vereistes verstaan nie.
Nou moet jy jou huis verkoop. Dit maak
nie sin by my nie. Dis belaglik.
Moet ek nie liewerste vir julle
aansoek doen vir ‘n verband soos voorheen aanbeveel nie, sonder
dat julle jul huis moet verkoop?
... Volgens die ‘Agreement of
Sale’ wat geteken is, is dit noodsaaklik dat Bank waarborge vir
die R240 000 verband bedrag
(asook die R150 000 deposito wat
oorbetaal moet word aan die Prokureurs se Trust rekening) uitgereik
moet word aan die Prokureurs...
voor, of op 23ste November 2006 en
dit gaan miskien nodig word om ons verkoper te vra om die datum in
paragraaf 1.2 en paragraaf
2 van hierdie ‘Agreement’ te
verleng met 2 weke. Ons sal dit met hulle moet opneem.”
[9] On 4 December 2006
Absa Bank purported to once again “approve” the loan but
by now the special condition was limited
to only the six month
building clause, as described above. The appellants thereafter
cancelled the Agreement of Sale in writing
on the basis that they had
not been granted a loan by a registered bank on or before 23 November
2006.
[10]
Mr. Buys submitted that it was incumbent upon the respondent to show
that a loan had been granted as stipulated in clause 2
of the
Agreement of Sale by no later 23 November 2006, that the suspensive
conditions had thereby been fulfilled and that respondent
was
accordingly entitled to the commission as referred to in clause 7 of
the Agreement of Sale. As correctly pointed out by Mr.
Buys the
respondent not only failed to place any evidence on record as to what
Absa Bank’s “normal terms and conditions”
were, but
in addition thereto and in writing on 13 November 2006 conveyed his
dismay and lack of comprehension as to what Absa
was attempting to
achieve. Respondent went so far as to suggest that a further loan be
applied for at another financial institution
and that the cut-off
date of 23 November 2006 as stipulated in clause 2 of the Agreement
of Sale be extended. There is no evidence
on record as to whether or
not such period for fulfilment of the suspensive condition was
extended or not and in the absence thereof
it must be found that the
cut-off date remained 23 November 2006. A proper understanding and
practical application of clause 2
is furthermore complicated by the
further stipulation that the suspensive condition would be deemed to
have been fulfilled upon
notification by the bank that the loan in
question had been approved “
regardless
of any conditions attaching to [such] loan
”
.
[11]
The evidence led in the Court
a quo
quite clearly shows that the contract concluded
between the parties was made subject to a suspensive condition and
that in the absence
of fulfilment of such condition, estates agents’
commission could not be earned.
See:
PHILLIPS v TOWNSEND
1983 (3) SA 403
(C) and
JURGENS EIENDOMSAGENTE v SHARE
[1990] ZASCA 81
;
1990 (4) SA 664
(A) at
675 G – I.
Respondent’s
entitlement to the payment of commission would in the final analysis
depend upon what was as such agreed between
the parties and whether
or not the terms and conditions of such agreement had been fulfilled
and/or complied with.
See:
NACH
INVESTMENTS (PTY) LTD V KNIGHT FRANK SOUTH AFRICA (PTY) LTD
[2001] 3 All SA 295
(A) at 296 J and
PHILLIPS v AIDA REAL
ESTATE (PTY) LTD
1975 (3) SA 198
(A).
[12] What must be
accepted for purposes of the appeal is that the contract between the
parties had already lapsed by 23 November
2006 alternatively the
appellants were within their rights to cancel the Agreement of Sale
after 23 November 2006, firstly, because
the appellants could not
obtain a loan as envisaged in terms of the Agreement of Sale before
such date and secondly, as it was
not possible for them to give
effect to the special conditions imposed by the bank. Of further
relevance is that the suspensive
period was not extended in writing,
as earlier suggested by the respondent.
[13] Clause 2 of the
Agreement of Sale quite clearly contains contradictory terms relating
to the suspensive condition and the only
reasonable conclusion to be
arrived at is that the special conditions stipulated by the bank when
the loan was approved, did not
as such constitute a loan granted by
the bank “upon its normal terms and conditions”, and that
consequently the suspensive
condition was never fulfilled. I find
that the Court
a quo
erred in finding on the facts before it
that the respondent had succeeded in discharging the onus and that in
the circumstances
the appeal should succeed with costs. Mr. Buys has
conceded that the appellants should be held liable for the costs
occasioned
by the two Applications for Condonation dealt with
earlier. The following order is accordingly made:
1. The Applications for
Condonation dated 24 June 2010 and 4 October 2010 are granted and the
appellants are ordered to pay the
costs thereof.
2. The appeal succeeds
with costs and the judgment of the Honourable Magistrate is hereby
set aside and varied to read:
“
The
plaintiffs’ claim is dismissed with costs.”
________________
P.U. FISCHER, AJ
I agree.
________________
S.P.B. HANCKE, J
On behalf of the
appellants: Adv. J.J. Buys
Instructed by:
Botha Hefer Inc.
BLOEMFONTEIN
On
behalf of the respondent: No appearance.
/sp