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[1990] ZASCA 87
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Price v Price (696/89) [1990] ZASCA 87 (11 September 1990)
696/89 /mb
IN THE SUPREME COURT OF SOUTH AFRICA (APPELLATE
DIVISION)
In the matter between:
PETER JOHN PRICE
APPELLANT
and
JEANETTE ANNE PRICE
RESPONDENT
CORAM
: NESTADT, KUMLEBEN JJA et NICHOLAS AJA
HEARD
: 27
AUGUST 1990
DELIVERED
: 11 SEPTEMBER 1990
JUDGMENT
KUMLEBEN JA
/
1.
KUMLEBEN JA
:
The respondent applied on notice of motion in the Eastern Cape Division of
the Supreme Court for an order:
"Declaring as valid, the acceptance by (Respondent) of (Appellant's) Notice in
terms of Rule 34 by virtue of her delivery of a Notice
in terms of Rule 34 (6)
on the 27th day of October, 1989."
The application was opposed.
After hearing argument the court (Cooper J) made an order as prayed, with costs,
and subsequently granted
the appellant leave to appeal to this court.
The application arose from divorce proceedings.
The respondent had
instituted action against her
husband, the appellant, for divorce and
certain
ancillary relief including custody of the minor
2/...
2. children and maintenance. The respondent was at all material
times represented by counsel, Mr Lang, instructed by her attorney,
Mr de la
Harpe. The appellant's legal representatives were her counsel, Mr Lowe, and Mr
Burman, his instructing attorney.
The case was set down for trial on 26
October 1989. Before and during that
day attempts were
made to settle the action in order that the matter
could
proceed as an undefended divorce. Late that
afternoon Mr Burman handed Mr de
la Harpe a written
offer of settlement. It was dated 26 October 1989,
made
without prejudice "in terms of Rule 34" and was
signed by Mr Burman. Its proposals covered all the
disputed issues. It was
common cause that Mr Burman
had the necessary authority to make such an offer
on
behalf of his client and that it was, as it purported
to be, one in terms of the said Rule.
3/...
3. The offer was considered by the respondent and her legal
advisers. She did not accept it at that stage: rather it was decided that
Mr
Lang should approach the other side to discuss the matter further. That evening
Mr Lang and Mr Burman had a lengthy meeting regarding
the offer but their
deliberations did not result in a settlement of the action. (I shall for
convenience simply refer to their discussion
as "the meeting".) Attempts at
settlement the following morning were equally unavailing. The trial therefore
started on 27 October
1989 and the respondent was still giving evidence when the
court rose. The case could not continue the next day and was adjourned.
The
respondent reconsidered her position and instructed Mr de la Harpe to accept the
written offer. This he did on 27 October 1989
by delivering to the appellant's
attorneys a notice which read:
4/...
4.
"
NOTICE IN TERMS OF RULE 34(6)
Sirs,
BE PLEASED TO TAKE NOTICE that the Plaintiff
hereby accepts the Defendant's offer of settlement
as set out in his Notice dated the 26th of
October, 1989 in terms of the provisions of Rule
34.
DATED at GRAHAMSTOWN this the 27th day of October,
1989
(Signed) D H DE LA HARPE"
It emerges from correspondence which
followed that it
was the appellant's contention that the offer had been
rejected before delivery of the said notice and that
therefore the
purported acceptance was of no force or
effect. Hence the application to
court for the
declaratory order.
The first question raised in the court a
quo
,
and argued before us, is a factual one: whether Mr
Lang at the
meéting made a counter-offer on behalf of
the respondent, amounting impliedly to a rejection of
the written offer. In this regard, having considered
5/...
5. the available evidence, Cooper J concluded that:
"In my view advocate Lang's approach to the respondent's attorney amounted to no
more than a request to modify or vary respondent's
offer, it was not a
counter-offer incorporating a rejection of the respondent's offer and did not
have the effect of terminating
the respondent's written
offer."
The second question raised, and considered in the
alternative in the court a
quo
, was whether, on a proper construction of
Rule 34, a plaintiff is permitted to accept an offer within the time prescribed
by the
Rule notwithstanding any prior communication rejecting it. This question
too was answered in favour of the respondent, the learned
judge deciding
that:
"Rule 34(6) confers upon a plaintiff an unqualified right to accept an offer
within a period of 15 days of receipt of the notice
of the defendant's offer and
since this provision supersedes the common law, a plaintiff is not precluded
from negotiating with or
making an offer
6/...
6.
to the defendant during the 15 day period at the risk of forfeiting his
rights."
The relevant provisions of sub-rules (1), (5), (6) and
(7) of Rule 34 read as follows:
"(1) In any action in which a sum of money is claimed, either alone or with
any other relief, the defendant may at any time unconditionally
or without
prejudice make a written offer to settle the plaintiff's claim. Such offer shall
be signed either by the defendant himself
or by his attorney if the latter has
been authorised thereto in writing.
(5) Notice of any offer ... in terms of this rule
shall be given to all
parties to the action.."
(6) A plaintiff may within 15 days
after
the receipt of the notice referred to in sub-rule (5) ... accept any offer
...."
(7) In the event of a f ailure to pay . .. within
10
days after delivery of the notice of acceptance
of the offer ... the party entitled to payment...
may, on five days written notice to the party who has failed to pay ... apply
through the registrar to a judge for judgment in accordance
with the offer ...
as well as f or the costs of the application."
7/...
7.
In regard to the first question, namely,
whether there was a counter-offer,one knows as a matter
of common
experience that frequently an offer of
settlement is followed by bargaining,
counter-proposals
and discussion before finality is reached; or
the
attempt at settlement is abandoned, with or without an
offer at that
stage subsisting. In such a case it is
often difficult to determine, in the
absence of
explicit rejection, whether, and if so at what point,
the
initial offer was impliedly rejected (by counter-
offer or otherwise) and, if
rejected, whether it was
thereafter repeated and thus revived. In each case
the
answer is a matter of inference to be drawn from the
proved or admitted
facts.
This problem is usually encountered and discussed
in reference to offer and acceptance in the field of
contract. In this regard in
Williston on Contracts
(Third Edition) Vol 1 paragraph 51 (pages 164 - 167) it
8/...
8. is stated that:
"When an offer has been rejected it ceases to exist, and a subsequent attempted
acceptance is inoperative, even though the acceptance
is made within a time
which would have been sufficiently early had there been no rejection.
Any words or acts of the offeree indicating that he declines the offer or which
justify the offeror in inferring that the offeree
intends not to accept the
offer, or give it futher consideration, amounts to a rejection. This principle
is most commonly illustrated
where a counter-offer or a conditional acceptance
which amounts to a counter-offer is made by the offeree. This operates as a
rejection
of the original offer.
The reason is that the counter-offer is interpreted as being in effect a
statement by the offeree not only that he will enter into
the transaction on the
terms stated in his counter-offer, but also by implication that he will not
assent to the terms of the original
offer. An answer purporting to accept upon
condition is not an acceptance but is in effect a counter-offer, because it
states in
substance that the offeree will contract on the terms of the original
offer if some addition or subtraction is made from them, but
implies that
otherwise he will not contract.
It is not true, however, that any communication from the offeree other than an
unequivocal
9/...
9.
acceptance is necessarily a rejection. Thus an inquiry by the offeree in regard
to the possibility of other terms is not a counter-offer
either in the form of a
conditional acceptance or otherwise, and does not reject the offer; nor does a
statement by the offeree that
he will 'delay coming to determination;' nor does
a request for a qualification of the offer coupled with an unqualified,
acceptance
not dependent on the granting of the request; nor does mere silence
of the offeree, although inaction may be consistent with an intention
not to
accept."
And
Corbin on Contracts
(Vol 1 para 89 pages
378
379), dealing more pertinently with the nature of a
counter-offer,
points out that:
"In the process of negotiation concerning a specific subject matter, there may
be offers and counter offers. One party proposes an
agreement on terms that he
states; the other replies proposing an agreement on terms that are different.
Such a cpunter proposal
is not identical with a rejection of the first offer,
although it may have a similar legal operation in part. In order to deserve
the
name 'counter offer,' it must be so expressed as to be legally operative as an
offer to the party making the prior proposal.
It is not a counter offer unless
it is itself an offer, fully complying with all the requirements that have been
previously discussed."
10/...
10. This rather detailed
exposition by thesê American writers of the legal position relating to the
formation of a contract
conforms to what has been said.in our law on the
subject. (See, for instance,
East Asiatic Co. (S.A.) Ltd v Midlands
Manufacturing Co. (Pty) Ltd
1954(2) S.A. 387 (C) 390 G and
Watermeyer v
Murrav
1911 AD 61
at 67.)
I turn to the facts of this case. In examining them two considerations are to
be borne in mind. First, the respondent's cause of action
is not founded on
contract. In
Frenkel, Wise and Co Ltd v Cuthbert
1946 CPD 735
Ogilvie
Thompson A.J. said at 742:
"Payment into Court is in my view a procedural, rather than entirely a
contractual, matter. Once the defendant elects to invoke Rule
24, the machinery
provided by that Rule comes into operation and regulates the rights of the
parties."
11/...
11.
This observation was made when discussing Rule 24 (Cape) which made
provision for payment into court by way of an offer of settlement.
The Cape Rule
was superseded by Uniform Rule of Court 34, which in turn was replaced on 27
November 1987 by the Rule in its present
form. The
dictum
nevertheless
holds good and applies in the instant case. The respondent's claim for the
relief sought is based squarely on the provisions
of this Rule and the
allegations that there has been compliance therewith. Second, as was emphasized
by Miller J in
Hart v Pinetown Drive-in Cinema (Pty) Ltd
1972(1) S.A. 464
(D) at 469 C - E:
"...where proceedings are brought by way of application, the petition is not the
equivalent of the declaration in proceedings by
way of action. What might be
sufficient in a declaration to foil an exception, would not necessarily, in a
petition, be sufficient
to resist an objection that a case has not been
adequately made out. The petition takes the place not only of the declaration
but
also of the essential evidence which would be led at a trial and if there
are
12/...
12.
absent from the petition such facts as would be necessary for determination of
the issue in the petitioner's favour, an objection
that it does not support the
relief claimed is sound."
(See too
Prok Africa (Pty) Ltd and
Another v NTH (Pty) Ltd and Others
1980(3) S.A. 687(W) 692 H.)
These observations apply similarly to answering affidavits and the
allegations they ought to contain.
It is against the background of these two considerations that one must
examine what is said - and not said - in the affidavits placed
before court.
Mr de la Harpe in his founding affidavit -the only affidavit lodged in
support of the application - alleged that there had been offer
and acceptance in
accordance with Rule 34. These averments were all that was necessary for the
respondent's cause of action, l:hat
is, for the relief claimed.
13/...
13. This affidavit went on (unnecessarily) to deal with
instructions given by the deponent to Mr Lang before the meeting and what
was
afterwards discussed between them. It is plain that these averments can throw no
light on what occurred at the meeting: they
in any event lend no support to the
proposition that the offer was rejected or a counter-offer made at the
meeting.
There was no affidavit from Mr Lang. The
appellant filed an answering
affidavit in which he gave
some account of what happened at the meeting,
which of
course he did not attend. There is, however, a
supporting affidavit of Mr Burman in which he states:
"I prepared (Appellant's) Affidavit in this matter and
accordingly confirm
all the facts set out therein."
The attorney's affidavit is no more than
confirmatory
and alleges no further facts regarding what took place
at the meeting. His evidence is thus reflected in, and
14/...
14
restricted to, what the appellant has to say on the subject
in the following paragraphs of his affidavit:
"5.2 As will appear from the confirmatory Affidavit of my Attorney, Daryl
Burman, it is correct that Advocate Lang approached him
at or about the time
stipulated, and stated that Applicant wished to avoid the house having to be
sold and that, accordingly, I should
increase my offer of maintenance.
5.3 The amount initially requested was an
additional approximately Rl 800,00
per month on
which amount Mr Burman sought clarification.
5.4 This was clearly a counter-offer made for my
consideration and certainly
not merely an enquiry.
5.5 At the end of a lengthy negotiation, Mr
Burman advised Advocate Lang
that, despite the
protestation of Advocate Lowe, who had then just
joined
the meeting, to the effect that my original
offer was more than generous in
view of my
financial position, he was prepared to put to me
the suggestion
that I should increase my offer of
maintenance by R600,00 per month on
conóition
that
Applicant would agree that she would never
be
entitled to claim an increase in maintenance."
The averment
in para 5.4 must be left out of account.
It is an inference or conclusion, not a statement of
15/...
15.
fact. (Cf.
Willcox and Others v Commissioner for Inland Revenue
1960 (4) S.A. 599
(A) 602 and
Radebe and Others v Eastern Transvaal
Development Board
1988(2) S.A. 785 (A) 792 H - 793 D.)
What then are the
facts
alleged by
the
appellant in his answering affidavit? In sum
they are
the following: (i) Mr Lang "stated" to Mr Burman that
the offer
of maintenance should be increased; (ii)
Counsel initially "requested" that
the additional
amount should be "approximately" Rl 800,00 per month;
(iii) Mr Burman advised Mr Lang that, although the
offer was more than
generous, he (Mr Burman) was
prepared to suggest to the appellant that he
should
increase his offer by R600,00 per month on condition
that the respondent agrees to waive any claim for
maintenance for herself
in the future; and (iv) the
meeting was a lengthy one. (It follows from this last
16/...
16.
allegation that what is said in (i) to (iii) above is either a cryptic
summary of what took place or no more than a partial account.)
Thus on analysis one notes that (i) and (ii) above are the only
communications on the part of Mr Lang from which a counter-offer or
rejection
could conceivably be inferred. But viewed jointly or severally no such
conclusion can possibly be reached: they do not
hint at a counter-offer, as
described by
Corbin
(supra) or at all. They are couched in language which
points the other way. There is therefore simply no evidence indicating, even
prima facie
, that a counter-offer intervened between the written offer
and its formal acceptance in terms of the Rule.
In the course of the debate before us, the onus of proof in another context
was raised. It was
17/...
17. contended that in an action on contract, should it be denied
that an agreement was concluded, the plaintiff would bear the onus
of proving
its formation by offer and (effective) acceptance. There is indirect authority
for this view. In
Dave v Birrell
1936 TPD 192
Greenberg J at 196 cited
with approval the statement in
Phipson on EVIDENCE
, 7th ed. 30 and 31
that
"where a given allegation, whether affirmative or negative, forms an essential
part of a party's case, the proof of such allegation
rests on
him"
and the learned judge added at 197, with reference to
the plea and onus in that case:
"The defendant's plea is not a confession and avoidance but is (or rather
contains within it) a denial of one of the essential elements
of plaintiff's
cause of action and the
onus
therefore rested on
plaintiff."
(See too
Kriegler v Minitzer and Another
1949(4) SA
18/...
18.
821 (A) 827 and 828; and
Da Silva v Janowski
1982(3)
S.A.
205(A) 219 A-C.) It was submitted that similarly
the onus of proof was upon
the respondent in the
present case to prove that the offer existed at
the
time of its acceptance. In the light of these
decisions one may assume
that, had the respondent
sought to base her cause of action on a contract,
the
onus of proof - in the true sense (see
South
Cape
Corporation (Pty) Ltd v Engineering Management
Services
(Pty) Ltd
1977(3) S.A. 534(A) 547H - 548B) -
would have been upon her to
prove the contract, i.e.,
offer and (valid) acceptance. But even in such a
case
a defendant would be required to raise the issue that
the offer came
to an end before acceptance and adduce
some
evidence to that effect. That is so since,
ordinarily and
without more, offer followed by
acceptance results in the conclusion of a contract.
However, I have already drawn attention to the fact
19/...
19. that the respondent in this case dces not rely on a contract
for her cause of action and that what is alleged by the appellant
cannot be
construed as an averment or assertion that a counter-offer intervened.
Mr de Bruin, who represented the appellant in
this
court, at one stage tentatively submitted that the
fact that the respondent continued with the trial after
the written offer
had been made, lent some support to
the submission that it had been rejected.
There is no
substance in this contention. During the 15 day period
within
which a plaintiff may as of right accept the
written offer in terms of the
Rule, he may - depending
on when the offer is made - be obliged to plead or
in
some other manner proceed with the litigation. Thus no
adverse inference may be drawn from his doing so. (One
need hardly add
thát should judgment be given before
acceptance, the offer self-evidently can no longer
20/...
20.
stand).
In the result I find on the facts that an offer and its acceptance in terms
of Rule 34 were proved by the respondent and that she
was therefore entitled to
the order sought. In the circumstances it is unnecessary to consider whether the
right to accept in terms
of the Rule is forfeited should there be an implied
rejection of the offer (by counter-offer or otherwise), or an explicit
rejection,
by or on behalf of a plaintiff during the said 15 day period or for
that matter at some later stage.
The appeal is dismissed with costs.
M E KUMLEBEN
JUDGE OF APPEAL
Nestadt JA)
Nicholas AJA) -
agree