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[2009] ZAGPJHC 99
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First Realty (Randburg) CC t/a Chas Everitt International Property Group v Hugo (2006/26060) [2009] ZAGPJHC 99 (20 October 2009)
SOUTH GAUTENG HIGH COURT,
JOHANNESBURG
Case No. 2006/26060
Date:20/10/2009
In the matter between:
FIRST REALTY (RANDBURG) CC
t/a
CHAS EVERITT INTERNATIONAL PROPERTY GROUP
Plaintiff
and
JANET
HUGO
Defendant
JUDGMENT
MEYER, J
[1] The plaintiff’s claim in
terms of its particulars of claim is based on a sole authority to
sell the defendant’s
immovable property and the breach thereof
by the defendant. It is alleged that the plaintiff would have been
able to effect a
valid sale had it not been for the defendant’s
breach. Damages are accordingly claimed against the defendant.
[2] By agreement between the parties a
separation and staying of the issue of the
quantum
of damages from all the
other issues was ordered. Counsel were
ad
idem
that the only issues
that remain by the end of this trial are whether or not the defendant
had given a mandate to the plaintiff,
its terms and whether or not
they were breached if it had been given.
[3] The plaintiff’s
representative, Ms. Ann-Marie Manuel, and the defendant, Ms. Janet
Hugo, are the only witnesses who testified.
It emerged from their
evidence that Ms. Hugo was the owner of an immovable property
situated at 35 Kessel Street, Fairland (‘the
Kessel Street
property’). A certain Mr. Hartman Ries was the owner of a
cluster unit situated at 114a, 11
th
Avenue, Fairland (‘the 11
th
Avenue property’). Ms. Manuel, in the performance of a mandate
that was given to the plaintiff by Mr. Ries, held a showday
of the
11
th
Avenue property on Sunday, 2 October 2005. The land of the Kessel
Street property was 2 974 square metres in extent, and Ms. Hugo
had
been looking for a smaller property for the past several years. Ms.
Hugo accordingly attended and viewed the 11
th
Avenue property. She was interested, but she considered the asking
price to be beyond her reach. Ms. Manuel and Ms. Hugo
inter
alia
spoke about her Kessel
Street property. Ms. Manuel told her that Mr. Ries might be
interested in purchasing the Kessel Street property
since he was a
property developer and always on the look out for larger properties
in the Fairland/Northcliff area that could be
subdivided and
developed.
[4] Negotiations aimed at Ms. Hugo
purchasing the 11
th
Avenue property and Mr. Ries purchasing the Kessel Street property
ensued over the next few days. Ms. Manuel took Mr. Ries to
the
Kessel Street property several times, either alone, or accompanied by
his children, or a building contractor, or his wife,
Mrs. Ronel Ries.
The negotiations failed since the parties could not reach agreement
on the selling prices of their respective
properties. It is common
cause that Mr. Ries wanted more for the 11
th
Avenue property than Ms. Hugo was prepared to pay. Ms. Hugo
testified that he also tried to pay as little as possible for the
Kessel Street property. Another factor that made this transaction
unachievable was the plaintiff’s insistence on a commission
of
a 5% plus VAT on the purchase price of each property. The result was
Mr. Ries informing Ms. Hugo that he was no longer interested
in the
plaintiff’s property; a souring of the relationship between
Mr. Ries and Ms. Manuel to an extent that he terminated
the
plaintiff’s mandate to further market the 11
th
Avenue property; Ms. Hugo informing Ms. Manuel that she was not
prepared to pay the difference between the asking prices of the
respective properties that she in terms of the final proposal was
required to pay; and, apart from a telephone conversation the
next
day when Ms. Manuel asked her to reconsider the final proposal, the
end of the dealings between Ms. Hugo and Ms. Manuel or
the plaintiff.
[5] Within two weeks, Ms. Hugo viewed
another property, a townhouse in Fairland, which was marketed by the
estate agent, Elna Pieterse
Property Consultant (‘Elna
Pieterse’). She made a written offer on this property which
was accepted. Once this transaction
had been concluded successfully,
the plaintiff, on 14 October 2005, gave an exclusive mandate to Elna
Pieterse to find a purchaser
for the Kessel Street property. On 26
October 2005, Mrs. Ries, through the estate agency of Elna Pieterse,
offered to purchase
the Kessel Street property for the total purchase
consideration of R1, 9 million. Ms. Hugo accepted the offer on 7
November 2005.
Ms. Hugo paid agent’s commission to Elna
Pieterse in a sum equivalent to 6%, inclusive of VAT, on the purchase
price.
[6] The plaintiff, in its particulars
of claim, avers that as a consequence of the sale through another
agency, the defendant, Ms.
Hugo, had breached the terms of her
mandate agreement with the plaintiff. The mandate on which the
plaintiff relies in its particulars
of claim is a verbal one in terms
whereof the defendant, during or about September 2005, appointed the
plaintiff as her sole agent
to find a purchaser for the Kessel Street
property. Exhibit A.18 is a document headed ‘mandate’
and dated 2 October
2005, which is the same date as the date upon
which Ms. Hugo viewed the 11
th
Avenue property. It records the giving by Ms. Hugo of a sole mandate
for a period of ninety days to the plaintiff to procure a
willing and
able purchaser for the sum of R1, 850.00 for the Kessel Street
property in exchange for the payment of a commission
calculated at
7.5% plus VAT on the purchase price. Ms. Manuel testified that she
wrote on this document what Ms. Hugo had said
she would agree to.
Ms. Manuel left the document with Ms. Hugo to sign and to return to
her. It is common cause that Ms. Hugo
never signed it.
[7] Ms. Hugo testified that she at the
outset told Ms. Manuel that the asking price for the 11
th
Avenue property was outside her price range. She told her about the
Kessel Street property, but made it clear to her that she
had been
looking for a smaller property for a few years, that she was not in a
hurry to find one, and that she would only place
her property on the
market once she had purchased one. It was Ms. Manuel who suggested
to her the possibility of an exchange or,
according to her, in the
words of Ms. Manuel a ‘swop’ of properties between her
and Mr. Ries, which transaction would
probably involve a payment of
money by Ms. Hugo to Mr. Ries because of the unlikelihood that the
properties were equal in value.
Ms. Hugo indicated that she would
consider such a transaction depending on the amount that she would be
required to pay in terms
of such a transaction. Once Mr. Ries had
viewed the Kessel Street property, Ms. Manuel informed her that he
was interested in
such a transaction. The figures that Ms. Manuel
presented to her as acceptable to him and the amount she was required
to pay in
were also acceptable to Ms. Hugo. But the figures which
Ms. Manuel presented to her subsequently required her to pay a much
larger
sum, which she refused. Specifically on the issue of the
mandate document on which the plaintiff relies, Ms. Hugo testified
that
the document was merely handed to her in circumstances where the
giving of a mandate was not discussed fully and where Ms. Hugo
was
not near a point of making a decision whether or not to give a
mandate for the sale of her property. Her property would not
be for
sale if the proposed transaction with Mr. Ries did not work out. She
was not prepared to place her property on the market
until she had
purchased another property. When the negotiations failed, she told
Ms. Manuel that her property was off the market.
[8] Ms. Manuel generally did not
inspire confidence on the witness stand. She became argumentative
with counsel for the defendant,
Adv. Williams; she was evasive on
occasion; and she contradicted herself on material aspects. I need
not elaborate on these since
her version of the mandate that Ms. Hugo
had allegedly given to the plaintiff and the terms thereof are
improbable and inconsistent
with the proven facts. It is refuted by
the written account that she had given to the plaintiff’s
principal, Mr. and Mrs.
Ries, at a time when Ms. Manuel probably had
no reason to distort the facts just before the negotiations failed
(exhibit A.7).
In this letter she first sets out what corresponds to
the evidence of Ms. Hugo of the two sets of figures or ‘offers’
that had been presented to her by Ms. Manuel. The second set of
figures required Ms. Hugo to pay R140, 000.00 more than had been
required of her in terms of the first set of figures. Ms. Manuel
wrote that this was ‘too expensive’ for Ms. Hugo.
It
also appears clearly from this letter that the sales of the two
properties were interlinked. But more importantly, Ms. Manuel
informed the plaintiff’s principal of the following:
‘
I have no mandate on 35 Kessel.
I did not know what her bottom line was. Her home
was
not on the market!’
[9] The explanation proffered by Ms.
Manuel under cross-examination that she used the incorrect wording
and left the word ‘written’
out, in other words that what
she meant was that she had ‘no written mandate’, is
simply not plausible. This in any
event does not explain why she
also informed the plaintiff’s principal that Ms. Hugo’s
home was not on the market.
Although the evidence of Ms. Hugo can
also be criticised in certain respects, her evidence on these issues
is not only consistent
with the account given by Ms. Manuel in this
letter, but also with the undisputed facts. Suffice it to mention
that Ms. Hugo did
not sign the written mandate immediately or at any
time after it had been given to her and I need to add that Ms.
Manuel’s
evidence as to why it was not signed immediately is
contradictory; Ms. Hugo did not allow Ms. Manuel or the plaintiff to
market
the Kessel Street property once the negotiations failed in
respect of the ‘swop’ or exchange transaction; and she
only gave a sole mandate to Elna Pieterse to find a purchaser for the
Kessel Street property once she had purchased a smaller property.
Ms. Manuel’s version that Ms. Hugo had given a sole mandate to
the plaintiff, her version of the terms of such mandate,
and her
version that they were breached by Ms. Hugo, is accordingly rejected.
[10] Adv. Heystek, who appeared for
the plaintiff, submitted that a tacit contract of mandate should be
inferred on the evidence
of the defendant. Ms. Hugo allowed Ms.
Manuel to find Mr. Ries as the purchaser for the Kessel Street
property as part of a transaction
in which she purchases the 11
th
Avenue property. Such mandate, if it was one, was not performed by
the plaintiff nor was it breached by Ms. Hugo.
[11] In the result the following order
is made:
The plaintiff’s action is
dismissed with costs.
P.A.
MEYER
JUDGE
OF THE HIGH COURT
20
October 2009