Mussolo (Pty) Ltd v Luterek and Another (460/05) [2006] ZAWCHC 48 (27 October 2006)

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[2006] ZAWCHC 48
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Mussolo (Pty) Ltd v Luterek and Another (460/05) [2006] ZAWCHC 48 (27 October 2006)

24
IN THE HIGH COURT OF
SOUTH AFRICA
(CAPE
OF GOODHOPE PROVINCIAL DIVISION)
REPORTABLE
CASE
NO. 460/2005
MUSSOLO
(PTY) LTD PLAINTIFF
and
JANUARY
JANUSZ LUTEREK FIRST DEFENDANT
THE
REGISTRAR OF DEEDS,
CAPE
TOWN SECOND DEFENDANT
JUDGMENT
DELIVERED ON 27 OCTOBER 2006
DLODLO,
J
INTRODUCTION
(1) The
question for determination in this matter is:
Whether
the suspensive condition relating to the rezoning of the erven to
group housing contained in clause 13.5 of the contract
was inserted
into the Deed of Sale for the sole or exclusive benefit of the
Plaintiff as purchaser; and
If
it was inserted for the exclusive benefit of the Plaintiff, whether
the waiver was at all orally communicated to the Defendant
on or
about 2 August 2004 as alleged by the Plaintiff.
The dispute
arises from the written contract of purchase and sale concluded
between the Plaintiff and the First Defendant in respect
of two (2)
vacant erven situated at Heidelberg, Cape, on 12 June 2004, in terms
of which the Plaintiff purchased the said immovable
properties from
the First Defendant for an amount of R80 000.00. The matter first
came before Court by way of opposed motion proceedings.
The dispute
could not be resolved on the papers resulting in the referral of the
matter to oral evidence. Mr. Van der Merwe appeared
for the Plaintiff
whilst Mr. Smith appeared for the First Defendant.
THE FACTUAL BACKGROUND
(2) The
Plaintiff is a company duly registered in terms of the laws of this
country and has as its registered head office at 14 Springstreet,
Mosselbay, Western Cape. The First Defendant is an adult male
resident at Flat number 6, Linkside Park, Harry Muller street,
Mosselbay,
Western Cape. The Second Defendant is the Registrar of
Deeds and does not feature in these proceedings but was merely cited
in its
official capacity in terms of the provisions of Act 47 of 1937
as amended.
(3) The
Plaintiff claims specific performance in the following terms against
the First Defendant (hereinafter the “Defendant”)
of his
obligations in terms of the written Deed of Sale entered into between
the parties on the 12
th
of June 2004 in respect of erven
943 and 944 Heidelberg:
“
(1) Dat
verklaar sal word dat die koopkontrak aangegaan tussen die partye op
12 Junie 2004 vir die verkoop van erwe 943 en 944 Heidelberg,
hierby
aangeheg gemerk aanhangsel “A”, geldend en bindend is tussen die
partye;
Dat verklarr
sal word dat Eiser geregtig is om oordrag van die eiendom bekend as
erwe 943 en 944 Heidelberg te neem in terme van
die koopkontrak,
aanhangsel “A”, teen betaling van die koopsom en die
oordragskostes;
Dat Eerste
Verweerder gelas sal word om binne 14 dae na datum van die uitspraak
in hierdie saak alle dokumente te teken en stappe
te neem as wat
nodig mag wees ten einde oordrag van die eiendomme hierbo vermeld
teen betaling van die koopsom in die naam van
Eiser oor te dra, by
gebreke waarvan die Balju van Heidelberg, gemagtig en gelas word om
al sodanige dokumente te teken en stappe
te neem as wat nodig mag
wees om oordrag van die eiendomme in die naam van die Eiser te
bewerkstellig;
(4) Dat
Eerste Verweerder gelas sal word om die koste van die saak te
betaal.”
(4) It is also
not in issue that the Plaintiff represented by one of its directors,
Jacques Esterhuizen and Defendant in person, on
the 12
th
of June 2004 and at Heidelberg, Western Cape Province entered into
the written Deed of Sale relied upon by the Plaintiff in this
action
and in terms whereof Plaintiff bought two vacant plots to wit erven
943 and 944 Heidelberg, Western Cape Province and situated
at
Middleton and Buitekant Streets, Heidelberg, Western Cape Province,
from Defendant at a purchased price of R80 000.00.
(5) In support
of the relief claimed as set out above, the Plaintiff averred in its
declaration that the Deed of Sale was subject
to a suspensive
condition that the Plaintiff as purchaser be in a position to re-zone
the property to group housing within six months
of the conclusion of
the Deed of Sale. This averment by the Plaintiff is admitted by the
Defendant but Defendant in addition pleaded
that the parties also
agreed that if the rezoning did not take place within the stipulated
period, the deposit paid by the Plaintiff
to the first Defendant,
would be forfeited to the First Defendant.
(6) The
Plaintiff in its declaration further averred that the suspensive
condition was included in the Deed of Sale for its sole benefit.
This
allegation by the Plaintiff is denied by the Defendant who pleaded
that the suspensive condition was inserted into the contract
in the
form in which it appears in annexure “A”, for the benefit of the
Defendant and the Defendant in paragraphs 6.2.1 to 6.2.3
of his plea
has elaborated on this averment. Plaintiff further in its declaration
averred that on or about 2
nd
of August 2004, the Plaintiff
waived the suspensive condition referred to above and which waiver
was orally communicated to an agent
of the Defendant, one Quinton
Rotherforth (hereinafter “Mr. Rotherforth”). This averment in the
declaration as far as the manner
in which the communication was done,
is elucidated by the Further Particulars and the evidence adduced and
is to the effect that
the communication was made by the Managing
Director of Plaintiff, Mr. Jacques Esterhuizen. The Plaintiff’s
allegations in this
regard are denied as if specifically traversed.
(7) The
Plaintiff further alleged in it’s declaration that it had complied
with all its obligations in terms of the Deed of Sale
as far as the
payments of the purchase price and delivery of guarantees, are
concerned. This allegation by the Plaintiff is denied
by the
Defendant who, in amplification of the denial pleaded that:
The
Plaintiff failed to pay the deposit of R8 000.00 on or before 26
th
June 2004 and that such deposit was only paid to Hahn & Hahn
Attorneys on July 2004;
The
Plaintiff failed to deliver a guarantee for the payment of the
balance of the purchase price of R72 000.00 within thirty days
of
the signing of the contract by both parties. A guarantee for the
payment of R60 000.00 was delivered to Hanh & Hahn Attorneys
during November 2004;
The
Plaintiff failed to deliver a guarantee for the payment of the
balance of R12 000.00 within the stipulated period, or at all.
(8) The
Plaintiff further averred that notwithstanding demand, the Defendant
failed to give transfer of the properties into Plaintiff’s
name, an
allegation admitted by the Defendant who further pleaded:
that
upon non-fulfilment of the suspensive condition by the Plaintiff
within the stipulated period, the contract terminated;
alternatively
that the Defendant cancelled the contract as a result of the
Plaintiff’s breaches thereof, namely:
to
deliver the guarantee for the payment of the full balance of the
purchase price within the stipulated period or at all and/or;
to
attend to the re-zoning of the properties in question to group
housing within the stipulated period or at all.
(9) The
Plaintiff’s further allegation that the Defendant avers that the
Deed of Sale has lapsed because of non-fulfilment of the
suspensive
condition, alternatively that he had lawfully cancelled the Deed of
Sale, are admitted. Plaintiff has also, at the request
of the
Defendant contained in the Rule 37 minute, filed further particulars
relating to the Plaintiff’s alleged oral communication
of the
waiver of the suspensive condition.
THE PLAINTIFF’S CASE
(10) Mr.
Jacques Esterhuizen testified that he is a co-director with his
father and managing director of the Plaintiff company. As
such he is
in charge of the day to day activities of the company. The latter is
a development company. According to Mr. Esterhuizen
the Plaintiff was
initially only interested to take transfer of the properties in the
event of the rezoning of the erven to group
housing. He mentioned
that the Plaintiff was also developing a site direct across the
street from the two (2) erven and for which
purpose it had also
applied for rezoning to group housing. It was Mr. Esterhuizen’s
evidence that the Plaintiff had insisted that
a similar suspensive
condition be included in all the contracts which it had entered into
during that time in respect of properties
which it purchased or
offered to purchase in Heidelberg. It was for this reason, testified
Mr. Esterhuizen, that he in his own handwriting
inserted the first
part of clause 13.5, containing the suspensive condition, as a back
stop, in the event of the application for
rezoning to group housing,
not being successful. He further testified that on the date of the
signing of the contract on behalf of
the Plaintiff, he handed a
cheque in respect of the deposit to the estate agent, Mrs. Louw. The
Plaintiff then applied for a bond
through Mrs. Fischer, the bond
originator in the amount of R60 000.00 in respect of the balance of
the purchase price of the two
(2) erven priced at R80 000.00. He was
later on telephonically informed by Mrs. Fischer that the bond had
been approved. After a
couple of days after the approval of the bond,
Mr. Esterhuizen had a telephone conversation with Mr. Rotherforth. It
was during this
conversation that Mr. Esterhuizen asked Mr.
Rotherforth to refund the Plaintiff an amount of R60 000.00 of the
R72 000.00 then held
in trust by Hahn & Hahn Attorneys. This sum
of money, according to Mr. Esterhuizen had been paid over by Attorney
Rauch Gertenbach
in respect of the balance of purchase price.
According to Mr. Esterhuizen it was during the same conversation that
he told Mr. Rotherforth
that he should proceed with the transfer of
the properties, notwithstanding the fact that the rezoning to group
housing had not been
approved yet, as the Plaintiff waives this
condition and seeks transfer of the erven into its name as soon as
possible.
(11) According
to Mr. Esterhuizen he similarly indicated to Attorney Pecoraro of
P.W. Hoffman Attorneys of Heidelberg, the bond attorneys.
Mr.
Esterhuizen testified that he probably phoned Mr. Rotherforth from
his cellular phone number 082 566 2890. The conversation,
according
to Mr. Esterhuizen, could have taken place a day or two before or
after 2 August 2004. He further testified that the possibility
existed that the telephone conversation might have been initiated by
Mr. Rotherforth and could have been made on his (Mr. Esterhuizen’s)
landline and not cell phone. Mr. Esterhuizen testified that by the
time he received notification of the bond, the Plaintiff had a
change
of heart as far as the usefulness of the erven was concerned and had
decided to keep and develop the erven, even if the application
for
rezoning to group housing was not approved. On 17 November 2004 Mr.
Esterhuizen had a telephonic conversation with Mr. Rotherforth
during
which he asked Mr. Rotherforth when can the transfer documentation
necessary to effect the transfer of the properties be expected.
In
December 2004 Mr. Esterhuizen received the letter in Bundle A (A37)
with certain documentation for signature by the Plaintiff.
He duly
signed the documents on behalf of the Plaintiff and returned same to
Hahn & Hahn Attorneys. It was on or about 22 December
2004 that
Mr. Esterhuizen received a copy of the letter A38 from Attorney
Pecoraro to which he responded with letter A40. Mr. Esterhuizen
subsequently received letter A43 from Mr. Rotherforth and a copy of
A41 from Mr. Pecoraro. The two letters were in response to the
letter
A40 which he had written. It was at this stage that Mr. Esterhuizen
handed over the matter to his attorneys, Goussard Attorneys
of
George. His attorneys on his instructions responded to A43 by writing
letter A45. Correspondence was then generated between Attorneys.
(12) Under
cross-examination Mr. Esterhuizen conceded that in the declaration it
is alleged that the telephonic conversation took
place on or about 2
August 2004 but that in his Affidavit filed in support of the earlier
application, he under oath stated that
it was on 2 August 2004,
whilst the Further Particulars provided at the Defendant’s request,
his attorneys of record stated that
the conversation took place
during August 2004. He further conceded that his outgoing
cellularphone records for the period 2 August
2004 until the end of
that month, do not reflect that a call had been made from his
cellularphone to the landline of Hahn & Hahn
Attorneys. Mr.
Esterhuizen testified that on behalf of the Plaintiff he tendered
payment of the purchase price of the properties
against transfer and
confirmed that he insists on specific performance of the First
Defendant's obligations in terms of the Deed
of Sale. There were
numerous contradictions which surfaced when Mr. Esterhuizen was
subjected to cross-examination. He obviously
faced certain
difficulties when he attempted to explain certain aspects of his
evidence. These will be dealt with when evidence is
evaluated
holistically.
(13) Mr.
Carmine Pecoraro testified that he was appointed as the bond attorney
in this matter. On 29 July 2004 he received a telephone
call from Ms
Fischer informing him that a bond in the amount of R60 000.00 had
been approved in favour of the Plaintiff. On or about
4 August 2004
he received confirmation of the bond approval by means of the
document filed as A50 from the bond originator Ms Fischer.
Mr.
Pecoraro thereafter telephonically contacted Mr. Esterhuizen and
informed him accordingly. It was during this conversation that
Mr.
Esterhuizen indicated to him that the Plaintiff had waived the
suspensive condition relating to the rezoning of the erven to
group
housing provided for in the Deed of Sale. On or about 22 December
2004 Mr. Pecoraro received the letter filed of record as
A38 and
forwarded a copy thereof to Mr. Esterhuizen. He testified that an
amount of R72 000.00 was refunded to him by Hahn &
Hahn
Attorneys. It is from this amount that he paid out R60 000.00 to the
Plaintiff. Mr. Pecoraro stated that the balance of R12
000.00 is
still in the trust account waiting to be paid over to Hahn & Hahn
Attorneys on registration of transfer of the erven
into the name of
the Plaintiff. According to Mr. Pecoraro, he only became aware that
the incorrect amount had been paid over after
the first week in
December 2004 when the firm’s trust account was reconciled. Mr.
Pecoraro wrote and sent the letter, (A53) to
the transfer Attorneys
and he was not thereafter informed that there was any problem
pertaining to the transfer of the properties
brought about by
non-compliance. He believed everything was on track. It came to
light when Mr. Pecoraro was cross-examined that
his firm P.W. Hoffman
had often done work for the Plaintiff and Mr. Esterhuizen prior and
subsequent to this transaction. The loan
Debit Authority telefaxed to
Hahn & Hahn Attorneys by Mr. Pecoraro was not a guarantee and it
hardly surprised him that Hahn
& Hahn Attorneys did not accept
it. Testifying in chief Mr. Pecoraro mentioned that he had no
knowledge whether Mr. Esterhuizen
informed anyone else besides
himself that the Plaintiff was waiving the suspensive condition in
the contract.
(14) Mrs.
Louw testified that Mr. Esterhuizen mentioned a condition regarding
the rezoning of the properties in question and asked
for a time
period. She was very uncertain whether Mr. Esterhuizen mentioned the
six (6) month as it later appeared in the condition.
She was,
however, sure that she would have first discussed the period with the
First Defendant. When cross-examined on this aspect,
Mrs. Louw
conceded that the First Defendant could have mentioned six (6) month
period as she was under the impression that the Plaintiff
would
attend to the rezoning of the properties in a much shorter period
because it was busy with the rezoning of other properties
in the area
Mrs. Louw further testified that the First Defendant had insisted on
the sanction of “Deposit NOT REFUNDABLE” which
she understood to
mean that the Plaintiff would have to forfeit the deposit if the sale
fell through. She added that she did discuss
this with Mr.
Esterhuizen who accepted it. Under cross-examination she conceded
that the words “Deposit NOT REFUNFABLE” related
to paragraph 13.5
only and not to the other conditions contained in paragraph 13. Mrs.
Louw testified that the First Defendant telephoned
her at some stage
and told her that the transaction had fallen through and asked her to
market the properties again at a higher price
and not to tell Mr.
Esterhuizen about it. This, according to her concession could have
taken place during January 2005. Mrs. Fischer
testified that she knew
Mr. Esterhuizen and that she attended to the Plaintiff’s bond
application for R60 000.00 which was approved
during July 2004
whereafter she advised Mr. Esterhuizen and Mr. Pecoraro accordingly.
THE FIRST DEFENDANT’S CASE
(15) Mr.
Luterek testified that he instructed Mrs. Louw to market his two (2)
properties in Heidelberg for approximately R80 000.00.
Mrs. Louw
later contacted him to advise him that she had a purchaser and she
discussed certain standard conditions with him as well
as her
commission and that he was satisfied with such conditions. He
testified that Mrs. Louw later contacted him to inform him that
the
purchaser intended rezoning the properties and wanted a further
condition inserted into the contract in this regard. He was concerned
that this could delay the transaction indefinitely and he discussed
this aspect with her and he suggested giving the purchaser the
period
of six (6) months to attend to the rezoning. He further insisted that
such rezoning would be for the purchaser's account.
When he received
the written contract for signature, he read paragraph 13.5 and he
then inserted the words “Deposit NOT REFUNDABLE”
at the end of
such paragraph as he wanted some compensation if the sale fell
through after having to wait six (6) months for the
rezoning to take
place. He further discussed this with Mrs. Louw before returning the
contract to her.
(16) Under
cross-examination he confirmed the above and testified further that
the period of 6 months was important to him as he did
not want to
wait indefinitely for his money and that he would never have agreed
to an open ended condition. He testified further
that he was not in a
hurry to sell the properties and that he had no prior offers to that
of the Plaintiff. He testified further
that he was a suspicious
person and that he did not want to have to pay any costs for the
rezoning if the purchaser resiled from
the contract, hence his
insistence that the rezoning would be for the purchaser’s account.
(17) Mr.
Luterek testified in chief that he regularly spoke to his brother at
attorneys Hahn & Hahn and on occasion he also spoke
to Mr.
Rotherforth about the progress in this transaction. He was never
advised by anyone that the Plaintiff had waived the suspensive
condition and it was only about four (4) to five (5) months after the
contract was signed that he was advised that the Plaintiff
wanted a
refund of the money already paid to Hahn & Hahn. During December
2004 he was advised that the Plaintiff had not rezoned
the properties
and he instructed Hahn & Hahn to put them to terms and if they
failed to do so, then to cancel the contract. He
was advised in
January 2005 that the contract was cancelled and that he could
re-market his properties, which he did.
(18) Mr.
Rotherforth testified that during 2004 he was a professional
assistant at Hahn & Hahn and dealt with this transaction.
In
preparation for the hearing of the matter during 2005 he went through
all the message books and the firm’s telephone records
for the
period July 2004 to December 2004 and he could only find one
reference to one telephonic discussion with Mr. Esterhuizen
and that
was on 17 November 2004 when Mr. Esterhuizen asked him when Hahn &
Hahn was going to refund the R60 000.00 to the Plaintiff.
He recalled
that Mr. Esterhuizen was somewhat rude to him and the impression he
got was that Mr. Esterhuizen desperately needed the
money. He further
went through the office file and was satisfied that all the relevant
documentation for this trial had been discovered
by the First
Defendant. He denied that he spoke to Mr. Esterhuizen on 2 August
2004 and further denied that Mr. Esterhuizen ever
informed him that
the Plaintiff was waiving the suspensive condition. He knew the
importance of suspensive conditions in a contract
and he would have
confirmed such a waiver in writing if Mr. Esterhuizen had informed
him thereof. He only became aware of the suspensive
condition when
the First Defendant contacted him in December 2004 to enquire whether
the rezoning of the properties had taken place.
He then contacted the
Heidelberg municipality and was advised that the Plaintiff’s
application for rezoning had not been granted
because certain fees
had not been paid by the Plaintiff. Mr. Rotherforth testified
further that he only became aware of the alleged
waiver of the
suspensive condition when he read Mr. Esterhuizen’s letter dated 28
December 2004, when his office reopened on 3
January 2005. He
confirmed the letters received and written by him with regard to this
transaction and readily made concessions in
favour of the Plaintiff.
He was diagnosed as being HIV positive in August 2005 and as a result
of this and the increased pressure
at work he resigned from Hahn &
Hahn in November 2005. He is currently employed as a legal advisor at
Legal Wise and he has no
interest in the outcome of this trial.
THE APPLICABLE LAW
(19) A party claiming specific performance in
terms of a contract must:
allege and prove the terms of the contract;
allege and prove compliance with its
antecedent or reciprocal obligations or must tender to perform them;
See:
SA Cooling
Services (Pty) Ltd v Church Council of the Full Gospel Tabernacle
1955 (3) SA 541
(D)
allege non-performance by the defendant;
claim specific performance.
See Harms,
Amler’s
Precedent of Pleadings
, 6
th
edition, p. 316
It is trite law that a
Court will, as far as possible, give effect to a Plaintiff’s choice
to claim specific performance. The Court,
however, does have a
discretion in a fitting case to refuse such relief and to leave it to
the Plaintiff to claim damages. This discretion
must be exercised
judicially and it is not circumscribed by rules. Each case has to be
judged in the light of its own circumstances.
Further on, the
discretion has to be exercised with reference to the facts as they
exist when performance is claimed and not as they
were when the
contract was concluded.
See eg:
Santos
Professional Football Club (Pty) Ltd v Igesund
and
Another
2002 (5) SA 697
(C); (on appeal reported as
2003 (5)
SA 73
(C); Harms,
Amler’s Precedent of Pleadings
316.
It is for a defendant
to allege and prove facts on which the Court can and must exercise
its discretion in his/her/its favour in this
regard.
See eg:
Tamarillo
(Pty) Ltd v BN Aitken (Pty) Ltd
1982 (1) SA 398
(A).
With regard to
suspensive condition for sole benefit of the purchaser the legal
position applicable is as follows:
Whether a suspensive condition in a Deed of
Sale was inserted for the sole or exclusive benefit of a particular
party, is a matter
of interpretation of the contract and the normal
rules applicable to the interpretation of the contract apply.
See:
Westmore v
Crestanello
1995 (2) SA 733
(W) 735 E-G;
Meyer v
Barnardo and Another
1984 (2) SA 580
(W) 586 J-H;
Van
Jaarsveld v Coetzee
1973 (3) SA 241
(A);
Marais v Van
Niekerk
1991 (3) SA 724
(E).
Non-fulfilment of a
condition that is exclusively for the benefit of one party may be
unilaterally waived by that party and cannot
be relied upon by the
other party. Two riders must be added to this proposition:
it must be clear that the parties intended
the condition to be exclusively for the benefit of the one party;
if the contract places a time limit on the
fulfilment of the condition, the party for whose exclusive benefit
it was imposed, cannot
waive it after the time-limit has expired.
See eg:
Christie,
The Law of Contract in South Africa,
5
th
edition,
146;
Ming-Chieh Shen v Meyer
1992 (3) SA 496
;
Westmore
v Crestanello
1995 (2) SA 733
(W).
EVALUATION OF EVIDENCE AND APPLICATION OF LAW
TO FACTS
(20) The
words “Deposit NOT REFUNDABLE” appearing at the end of paragraph
13.5 of the agreement, according to Mr. Esterhuizen,
were written
into the contract prior to him appending his signature thereon. In
his view these words related to all the conditions
contained in
clause 13.5. This, however, is difficult to comprehend since the
words were only inserted by the First Defendant when
Mr. Esterhuizen
had inserted the Afrikaans words appearing in clause 13.5. Of
significance though is Mr. Esterhuizen’s concession
that he signed
the contract and initialled this clause containing the word “Deposit
NOT REFUNDABLE”, with full knowledge and
understanding that if the
Plaintiff did not waive the suspensive condition contained in clause
13.5 before 12 December 2004 or if
the Plaintiff did not rezone the
properties to group housing before such date and the sale fell
through, the Plaintiff would then
forfeit the deposit paid. This
concession is strangely consistent with the First Defendant’s
evidence that he had no interest in
what the Plaintiff intended to do
with the properties but that his only concern was that the time for
the rezoning was limited and
that such rezoning was for the
Plaintiff’s account and that he would be compensated for the
waiting period if the sale fell through.
(21) I
found it rather strange that Mr. Esterhuizen’s testimony is that
there was no negotiation regarding the period of six (6)
months
mentioned in clause 13.5, a period within which the rezoning had to
be done and that it was himself who suggested such a period
to Mrs.
Louw, the estate agent. It is of note that Mrs. Louw readily conceded
that the First Defendant could possibly have suggested
the time
period of six (6) months as she was under the impression that the
Plaintiff could attend to the rezoning of the two properties
within a
much shorter period because it was already busy with such rezoning in
the area. This Court cannot also lose sight of the
fact that Mr.
Esterhuizen during January 2005 deposed to an Affidavit filed in
support of an urgent application the Plaintiff brought
against the
First Defendant. Significantly Mr. Esterhuizen stated in that
Affidavit
inter alia
that the said suspensive condition was
negotiated (beding) for the exclusive benefit of the Plaintiff. To
now testify that there
was no negotiation on this aspect, is indeed
not only contradictory, but is most certainly disingenuous to say the
least.
(22) It
is important to mention that the application proceedings the
Plaintiff Company brought against the First Defendant form an
integral part of this matter. In the same Founding Affidavit Mr.
Esterhuizen also stated that on 2 August 2004 he expressly orally
informed Mr. Rotherforth of the firm Hahn & Hahn Attorneys in
Pretoria (the appointed conveyancers by the First Defendant who
were
to attend to the registration of transfer) that the Plaintiff was
waiving the said suspensive condition and that it desired
that the
registration of transfer should take place as quickly as possible.
The First Defendant and Mr. Rotherforth in answer to
the Founding
Affidavit told a totally different story. The First Defendant denied
that the suspensive condition in the form in which
it appears in the
contract was inserted into the contract for the exclusive benefit of
the Plaintiff. Mr. Rotherforth denied that
Mr. Esterhuizen or any
other person on behalf of the Plaintiff orally advised him that the
Plaintiff had waived the provisons of
the suspensive condition and
that the first time that he became aware of the alleged waiver of the
rezoning clause in the contract
was when he received a letter from
the Plaintiff dated 28 December 2004.
(23) It
was initially alleged by Mr. Esterhuizen that he used his cellular
phone number 082 566 2890 in telephoning Mr. Rotherforth
about the
waiver of clause 13.5. However, the cellular phone records in respect
of the above-named cellular phone number generated
by Vodacom
covering the period 1 August 2004 to 31 August 2004 handed in by the
consent of the Plaintiff and marked as Exhibit “B”,
do not show
that Mr. Esterhuizen did infact, make that call. Mere intention or
mental resolution to waive a right which is not communicated
to the
other party affected by such waiver and which is not evidenced by any
overt act known to him, cannot in law constitute a waiver
of the
right by the person entitled to enforce it (
Mutual Life
Insurance Co of New York v Ingle
1910 TPD 540).
(24) Mr.
Esterhuizen did concede when he was cross-examined that there was no
record of any telephone call made from his cellular
phone to
Attorneys Hahn & Hahn during the period stretching from 1 August
2004 to 31 August 2004 on Exhibit “B”. He then
suggested that Mr.
Rotherforth could have telephoned him or that he had used another
telephone to communicate the waiver to Mr. Rotherforth.
The latter
assertion apart from the fact that it contradicts Mr. Esterhuizen’s
Affidavit as well as his previous evidence in the
same matter and on
the same aspect, in my view, smacks of untruthfulness and dishonesty
on the part of Mr. Esterhuizen. With regards
to the refund of R60
000.00 Mr. Esterhuizen testified he informed Mr. Rotherforth that the
Plaintiff’s bond had been approved and
that he requested Mr.
Rotherforth to refund to him an amount of R60 000.00 which Mr.
Rotherforth agreed to do. When cross-examined
on this Mr. Esterhuizen
conceded that it was more probable that he would have telephoned Mr.
Rotherforth as he wanted to inform him
about the waiver of the
suspensive condition and he wanted to request him to refund the R60
000.00. His problems compounded, however,
even on this point because
when it was pointed out to him that Mr. Rotherforth would not have
agreed to such a refund at that stage
as the R72 000.00 had not yet
been received by Hahn & Hahn Attorneys, he suggested that the
telephone call must have been on
a date after Hahn & Hahn
Attorneys had received the sum of R72 000.00. I hasten to mention
without comment that when a witness
jumps from one assertion to the
other whenever he finds himself in some difficulty, then it would not
be misplaced for any trial
Court to come to an inescapable conclusion
that such witness is engaged in a game the aim of which is certainly
to mislead the Court.
I am very much aware that the Deed of Sale
in
casu
contains no provision in terms of which any waiver could be
communicated to the other side. But then, any form of clear and
unequivocal
intimation of waiver would suffice (See
De Villiers
and Another NNO v BOE Bank Ltd
2004 (3) SA 1
(SCA);
Alesandrello v Hewit
1981 (4) SA 97
(W)). I accept that
the waiver in the context of this matter could have been made orally
and would have had legal force. What troubles
me though is whether or
not this waiver was made at all no matter how. If the Plaintiff
succeeded in proving that the waiver was
infact communicated to Mr.
Rotherforth (who then acted as the First Defendant’s agent) that
waiver could have been deemed to be
a communication to the First
Defendant. (See
Basson v Remini and Another
1992 (2) SA
322
(D).
Another aspect of Mr. Esterhuizen that
somewhat must be considered in an endeavour to find if anybody else
knew timeously about
this waiver, is to be gleamed from his
communications with his own Attorneys P.W. Hoffman. It is to be
recalled that in his testimony
Mr. Esterhuizen stated that his
Attorneys P.W. Hoffman made several written requests to Hahn &
Hahn Attorneys to refund the
R60 000.00 between 16 August 2004 and
28 October 2004. We know that Attorneys P.W. Hoffman eventually
received a refund. What I
find strange and somewhat telling is that
regard being had to correspondence as a whole written by P.W.
Hoffman to Hahn & Hahn
Attorneys over the period mentioned
supra
one does not find even a single correspondence that mentions waiver.
It is most certainly not unreasonable to have expected the
Plaintiff’s Attorneys to emphasize this aspect, especially because
the bond had already been approved during July 2004. We now
know
from Mr. Esterhuizen’s testimony and from the annexures filed of
record that Messrs. Bailey & Le Roux land surveyors
were given
instruction by Mr. Esterhuizen to attend to the rezoning
applications including the rezoning of the First Defendant’s
properties which are the subject matter in this litigation. It was
totally an insurmountable mountain to climb for Mr. Esterhuizen
when
he was asked to explain why he had allegedly waived the suspensive
condition on 2 August 2004 and yet instructed the land
surveyors
during September 2004 to proceed with such rezoning application as
evidenced in Exhibit “A” page 56-57.
(26) Mr.van
der Merwe referred to the approach to be adopted where a Court is
confronted with two (2) irreconcilable versions as
authoritatively
dealt with in
Stellenbosch Farmers’ Winery Group Ltd and
Another v Martell et kie and Others
2003 (1) SA 11
(SCA). It
is common cause that the latter judgment was indeed followed and
applied by the Supreme Court of Appeal in
Santam Bank Beperk v
Biddulph
2004 (5) 586 (SCA) and
Louwrens Oldwage
2006 (2) SA 161
(SCA). I am indeed bound to follow the approach as
enunciated by our Supreme Court of Appeal. In fact, in
Santam
Bank Beperk v Biddulhp
2004 (5) SA 586
(SCA) 592 B-C, the
Court held that even if a witness may not have been a satisfactory
one, the proper test is not whether a witness
is truthful or indeed
reliable in all that he says, but whether on a balance of
probabilities, the essential feature of the story
which he tells are
true. Bearing the above guidance in mind, I pause and rhetorically
ask a question, which essential features of
the story told by Mr.
Esterhuizen in the instant matter can infact be labelled as truthful?
I hope to find answers to this rhetoric
question as I proceed to
analyze the testimony in this case and marry the facts to the legal
principles.
(27) Mr.
van der Merwe submitted that in his view Mr. Esterhuizen’s version
was corroborated by A37 and in particular by Mr. Rotherforth’s
responses to A40 and A45, A41, A43 and A47 respectively. Mr. van der
Merwe relied for this submission on authorities such as
Seeff
Commercial and Industrial Properties (Pty) Ltd. v Silberman
2001 (3) SA 952
(SCA) 952 H;
McWilliams v First Consolidated
Holdings (Pty) Ltd
1982 (2) SA 1
(A);
Decro Paints and
Hardware (Pty) Ltd v Plascon-Evans Paints (TVL) (Pty) Ltd.
1982 (1) SA 213
(O) 220 F-H;
Hamilton v Van Zyl
1983
(4) SA 379
(E) 388E – 389B.
(28) Even
if I have already referred to this aspect of the Plaintiff’s case,
I undertake to revisit same in order to ensure that
I do not lose
sight of the content of this submission by Mr. van der Merwe. Mr. van
der Merwe submitted further that Mr. Rotherforth’s
evidence denying
the oral communication of the waiver to him must be rejected by the
Court because in his view such evidence is unreliable,
untruthful and
not credible regard being had to the improbabilities therein
contained. Mr. van der Merwe was very critical of Mr.
Rotherforth’s
memory and the practice followed by Hahn & Hahn Attorneys. I will
obviously evaluate Mr. Rotherforth’s testimony.
(29) Mr.
Pecoraro telefaxed a Loan Debit Authority to Hahn & Hahn
Attorneys but when cross-examined he readily conceded that this
was
not a guarantee (kantoor waarborg) and that it came as no surprise to
him when Hahn & Hahn Attorneys did not accept it. I
find it
rather strange that when Mr. Pecoraro discovered through
reconciliation that the sum of R72 000.00 had been refunded, he
did
not merely pay back to Hahn & Hahn Attorneys the sum of R12
000.00. This, he could do simultaneously with the refund of R60
000.00 he made to the Plaintiff. Mr. Pecoraro’s testimony that he
had no knowledge whether Mr. Esterhuizen informed anyone else
beside
himself that the Plaintiff was waiving the suspensive condition in
the contract is to me of some importance. It serves as
an indicator
that the probabilities are such that Mr. Esterhuizen in fact never
waived and/or communicated his waiver to Mr. Rotherforth
as testified
by the former. It is not out of the ordinary for this Court to have
expected an experienced businessman in the person
of Mr. Esterhuizen
to have advised his own attorney of such a crucial fact, if he indeed
informed the seller (First Defendant) of
the said waiver.
(30) Mrs.
Louw’s, as well as Ms Fischer’s evidence did not, in my view,
advance the Plaintiff’s case any further especially
on the aspect
of importance in this matter. The facts in the instant matter
strangely lend themselves squarely on the following law,
succinctly
set out in
Design and Planning Service v Kruger
1974
(1) SA 689
(T) 697G:
“
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 negating 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.”
There is, in my view,
nothing in the contract in the instant matter that negatives the
implied term to the effect that non-fulfilment
of the suspensive
condition renders the contract a nullity. It is well established that
a suspensive condition in a contract makes
the operation of the
contract subject to the occurrence of a future event. Once the
condition is fulfilled, the contract becomes
binding and its terms
can be enforced. See:
Tuckers Land and Development Corp (Pty)
Ltd. v Strydom
1984 (1) SA (A).
It is important to note that the suspensive
condition must be fulfilled on or before the time limit stated in
the contract and if
this does not happen, the operation of the
contract terminates automatically and immediately upon such
non-fulfilment. See:
Phillip v Townsend
1983 (3) SA
403
(C);
Dirk Fourie Trust v Gerber
1986 (1) SA 763
(A). I was very much impressed with the straight forward and logical
manner used by Mr. Rotherforth in testifying. He was in my
view a
very good witness. I have no reason to doubt his honesty on the
aspects he testified about. Mr. van der Merwe subjected
this witness
to thorough cross-examination dealing at length not only with
evidence he presented but also Mr. Rotherforth’s professional
and
even personal life. Mr. Rotherforth has no reason to protect any
party in this litigation. He long left Hahn & Hahn Attorneys.
I
find him to have been unbiased and reliable as a witness in this
matter.
I have studied the various annexures
contained in Exhibit “A”. I do not agree that A37 and Mr.
Rotherforth’s responses to
A40, A43, A45 and A47 in any much
helpful manner supports Mr. Esterhuizen’s testimony regarding the
waiver of the suspensive
condition. It is indeed the law that the
conduct of the contracting parties also has relevance in the
determination of the question
of whether or not waiver had taken
place. In the instant matter I have been unable to deduce anything
even from the conduct of
the parties supporting the contention that
there was waiver. On the contrary, the fact that Mr. Esterhuizen
allegedly waived the
suspensive condition on 2 August 2004 (or
during August 2004) and during September 2004 the same Mr.
Esterhuizen instructed the
land surveyors to proceed with such
rezoning application as evidenced by Exhibit A56-57, is clearly
indicative of the truth, namely,
that there was no such waiver at
all. In my view the Plaintiff’s claim stands to be dismissed.
COSTS
The general rule that a successful party is
entitled to its costs must clearly apply in the instant matter.
There is and can be
no justification in the circumstances of this
matter to depart from the general rule.
ORDER
In the result I make the following order:
The Plaintiff’s claims are hereby dismissed
with costs.
The First Defendant shall pay the wasted
costs (as tendered) of 1 June 2006 occasioned by the
non-availability of its witness.
___________________
DLODLO, J