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[1] This is an exception to particulars of claim brought by the first defendant (CDH)
on the basis that the pleadings disclose no cause of action against it.
[2] The pleaded facts are briefly to the following effect. The Plaintiff (Centura) and
the Second Defendant (Absa) concluded a written contract of sale in terms of
which, amongst other things: Absa sold two immovable properties to Centura;
and CDH was appointed as the conveyancing attorneys.
[3] The contract was an instalment sale agreement. It was recorded that a deposit
of R1 237 500 had been paid prior to the signature of the agreement; that a
further deposit of R2 000 000 was payable on the first day of the month after
signature date (that being 1 June 2021) and that the balance of the purchase
price would be paid in twelve monthly instalments in specified amounts and at
specified times.
[4] Clause 20.2 of the contract is a pivotal clause. It provides that on cancellation for
breach under the contract “the seller [Absa] shall be entitled to retain all amounts
paid on account of the purchase price (or in accordance with the provisions of
[the] Contract), as agreed liquida ted damages, or as a payment in respect of the
prejudice agreed as suffered by [ Absa] as a result of [Centura’s] breach.”
[5] In total Centura made payment under the contract of an amount of
R8 809 206.43. This figure takes into account the deposit paid prior to the
conclusion of the contract.
[6] Centura claims this total amount from CDH on the basis that it alleges that under
the contract these funds are held on its behalf in trust by CDH in the context of
its position as conveyancer in the transaction.
[7] CDH says that is not how the contract reads on its plain literal terms. It says in
terms of the contract it is to hold all the monies paid as agent for ABSA.
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[8] I accept that, in deciding an exception, the court must take the facts alleged in
the pleadings as correct and that the court must generally be reluctant to decide
questions concerning the interpretation of a contract on exception.
[9] As was stated by Nestadt JA in Sun Packaging (Pty) Ltd v Vreulink1, where the
terms of the contract are certain this reluctance will give way to such certainty.
[10] The plaintiff bases its cause of action against CDH on a mandate to hold the
funds for the plaintiff and refund them on demand. Clause 20 of the particulars
of claim read as follows:
“20 In breach of its written, alternatively, express oral, further alternatively, tacit or
implied mandate, the first defendant refuses or fails to refund the funds paid to the first
defendant and the interest earned thereon to the plaintiff.” (emphasis added).
[11] In response to a notice in terms of sub -rules 35(12) and (14) from CDH asking
for a copy of the written mandate Centura, referenced clause 6.4 of the
agreement as the “written portion” of the mandate.
[12] The contract is not between Centura and CDH and neither is the latter a party
thereto. Clause 6.4 of the contract reads as follows:
“6.4 The cash deposit paid by the Purchaser to the Seller’s Conveyancers pursuant to
clause 6.1 will be held in trust by the Seller’s Conveyancers pending registration of
transfer of the Property into the name of the Purchaser, and the Seller’s Conveyancers
are instructed to invest such amount with a registered bank of their choice on the basis
that-
6.4.1. the amount is invested in an interest -bearing account;
1 Sun Packaging (Pty) Ltd v Vreulink 1996 (4) SA 176 (A).
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6.4.2. the interest -bearing account contains a reference to section 86(4) of the
Legal Practice Act, No28 of 2014;
6.4.3. the interest which accrues on such investment is to be for the benefit of
the Purchaser and will be paid, after deducting the Seller’s
Conveyancers’ professional fee for administering the investment, to the
Purchaser on registration of transfer of the Property into the name of the
Purchaser; and
6.4.4. the cash deposit paid by the Purchase in terms of clause 6.1 will be paid
to the Seller against registration of transfer of the Property into the name
of the Purchaser.
[13] Thus clause 6.4 deals only with the fact that portion of the purchase price (R1
237 500.) is to be invested in an interest -bearing account until transfer, the
interest being for the benefit of Centura. This does not change the fact that, in
terms of clause 6.5, all payments to be made by Centura under the agreement
would be made to Absa or its nominee.
[14] CDH says it is patently the agent of Absa in that all the funds were paid to it. It is
also the conveyancer under the contract.
[15] There is not one indication in the contract of the terms pleaded in relation to the
alleged mandate. Indeed, the express terms are to the contrary.
[16] Furthermore, it is not pleaded that the mandate was partially written. It is pleaded
as being written, or oral or tacit or implied. No oral terms are pleaded and neither
does the written contract allow for the finding of the existence of an implied or
tacit term of mandate between CDH and Centura.
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Delivered: 10 February 2025
APPEARANCES:
Applicant’s counsel: Adv. C T Vetter
Applicant’s Attorneys: Cliffe Dekker Hofmeyr Inc
Respondent's Counsel: Adv. M.v.R Potgieter SC
Respondent Attorneys: Senekal Simmonds Inc