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1995
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[1995] ZASCA 10
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E U Civils (Pty) Ltd. v Clifford Harris (Pty) Ltd. (473/93) [1995] ZASCA 10 (10 March 1995)
Case No 473/93
IN THE SUPREME COURT OF SOUTH AFRICA APPELLATE DIVISION
In the matter between:
E U CIVILS (PTY) LIMITED
Applicant
and
CLIFFORD HARRIS (PTY) LIMITED
Respondent
CORAM
: HEFER, STEYN, F H GROSSKOPF, VAN
DEN HEEVER JJA et NICHOLAS AJA
HEARD
: 20 FEBRUARY 1995
DELIVERED
: 10 MARCH 1995
J U D G M E N T
HEFER J A
/
2
HEFER JA
:
The applicant in this application for condonation was the unsuccessful
plaintiff in the Cape of Good Hope Provincial Division where
its claim for
damages against the respondent was dismissed with costs. After obtaining the
necessary leave from the trial judge the
applicant filed a notice of appeal but
failed to serve it on the respondent's attorneys in terms of the Rules of Court;
hence the
present application which is opposed by the respondent on the ground
that there are no prospects of a successful appeal.
The claim arose from a collision which occurred between two motorised
scrapers in the course of certain earthmoving operations in
Khayelitsha. Both
scrapers were damaged, one beyond repair and the applicant who bore the risk of
that damage in terms of an instalment
sale
3
agreement is seeking to recover its value from the respondent. It is alleged
in the particulars of claim (but denied in the plea)
(1) that the collision was
caused by the negligence of Mr Hentile, the driver of the other scraper and (2)
that Hentile drove that
scraper in the course of his employment with the
respondent, alternatively, under the respondent's control and supervision. On
the
first issue the trial court ruled in the applicant's favour; but on the
second issue the court found that Hentile was not employed
by the respondent nor
did the latter have the right of control over the way in which he performed his
duties. The outcome of the
appeal - and thus of the present application -
depends upon the correctness of this finding and it is accordingly not necessary
to
mention other matters which were in issue at the trial but are not
presently
4
relevant.
How the controversy about Hentile's employment and the
respondent's control came about, appears from what follows.
A consortium of
five companies including the applicant successfully tendered to perform certain
bushclearing and earthmoving operations
for the Cape Provincial Administration
in Khayelitsha. In its tender the consortium indicated that it would provide a
general foreman
and five other foremen to supervise the work. It was
contemplated that each member would contribute a foreman and a number of
machines
and operators but, in view of the consortium's commitments elsewhere,
its members apprehended that their resources would be over-extended.
On behalf
of the consortium the applicant accordingly entered into an agreement with the
respondent in terms of which the latter
5
would supply additional machines and operators. According to Mr Marsh, the
applicant's managing director who testified at the trial,
it was a term of the
agreement that the respondent would also supply a foreman. Respondent's
witnessess maintained that it was only
when the machines and operators arrived
on the site that Mr Smit, the consortium's general foreman, insisted that a
foreman be supplied
by the respondent. Be that as it may it is common cause that
the respondent called in Mr Visser to act as a foreman. Smit took instructions
from the consulting engineers and in turn allocated specific tasks to specific
teams under the supervision of specific foremen. He
thus exercised general
control over all the foremen, each of whom was in turn in direct control of the
team to which he was assigned.
On the day of the collision applicant's
6
driver and Hentile were both members of Visser's team. Hentile operated a
scraper provided by the respondent but owned by the latter's
holding company,
Basil Read (Pty) Ltd ("Basil Read"). Smit had charged the team with the task of
levelling a dune and dumping the
sand in a low-lying area in the vicinity. The
collision occurred on a haul road between the loading area and the dumping area
when
(so the trial court found) Hentile deviated from the pre-determined course
and crossed the path of the other scraper.
As mentioned earlier the applicant alleges in its particulars of claim that
Hentile drove the scraper in the course of his employment
with the respondent.
It is common cause however that he was employed, not by the respondent, but by
Basil Read. Vicarious liability
can accordingly only be imputed to the
respondent if the
7
alternative allegation that Hentile acted under the respondent's control and
supervision has been established. The applicant's case
(as appears from
particulars supplied for purposes of the trial) is
that
"Defendant's employees, and in particular its Mr Visser, were responsible for
the supervision of the team of machines used in the
operation during which the
collision occurred."
It is common cause that Visser was also employed by
Basil Read. Faced with this difficulty applicant's
counsel submitted that control over the exercise by
Visser of his functions was transferred to the
respondent and no longer remained with Basil Read.
He conceded that there was no evidence of an
express agreement to that effect but submitted that
facts had been proved from which it might be
inferred that control over the way in which Visser
8
exercised his duties was transferred to the respondent. In this
regard he relied upon the "close relationship" between a holding company
and its
subsidiary, the fact that Visser was provided by the respondent in order to
fulfill its obligations under its agreement with
the consortium and the
existence of an agreement between the respondent and Basil Read in terms of
which the risk of loss or damage
to the scrapers provided by Basil Read rested
with respondent.
It may be mentioned that, for the purposes of a counterclaim which was
dismissed, the respondent adopted the attitude that control
over Visser had
passed to the consortium and that this is indeed what the trial court found.
Such an inference might well be drawn.
Even if Basil Read did relinquish control
over its employees
pro hac vice
I do not think that it can be inferred
that
9
control passed to the respondent. In all the circumstances of
the case I am prepared to accept that the facts relied on may reasonably
support
the inference contended for. I also accept that the inference sought to be drawn
need not in a civil case be the only reasonable
one. But, precisely by reason of
the close relationship between a holding company and its subsidiary it is in my
view more natural,
suitable or acceptable to conclude that it was the respondent
and not its holding company who exercised control over Visser (
Govan
v
Skidmore
1952(1) SA 732 (N) at 734C-D;
A A Onderlinge
Assuransie-Assosiasie Bpk v De Beer
1982(2) SA 603 (A) at 614H-615B). It
might at least equally well be that the question of the transfer of control was
never considered
or that it was considered but found to be unnecessary. What was
required to be transferred to render the respondent vicariously
10
liable was control in respect of the way in which Visser had to perform his
duties (
Penrith
v
Stuttaford
1925 CPD 154
at 159;
McMillan v
Hubert Davies & Co Ltd
1940 WLD 256
at 262;
R v AMCA Services Ltd and
Another
1959(4) SA 207 (A) at 212H;
Colonial Mutual Life Assurance
Society Ltd v McDonald
1931 AD 412
at 434-435) and, in view of the
relationship between the two companies, there seems to be no reason for the
delegation to the subsidiary
of control which the holding company was in any
event entitled to exercise.
Applicant's counsel rightly accepted the onus of proving that the required
degree of control had passed to the respondent (
Stadsraad van Pretoria v
Pretoria Pools
1990(1) SA 1005 (T) at 1007 H-J). Three of the respondent's
directors testified at the trial; not one of them was asked a single
question in
an attempt to ascertain what
11
had passed between the respondent and Basil Read. In my judgment the onus has
not been discharged on the meagre circumstantial evidence
available.
It follows that the appeal cannot succeed and that the present application
falls to be dismissed. The appeal was enrolled for the
same day on which the
application was heard. A suitable order will accordingly be made to dispose of
the appeal as well.
It is ordered that
1.
the application for
condonation be dismissed with costs including the costs of two
counsel;
2.
the appeal be struck from the roll
with costs including the costs of two
counsel.
J J F HEFER JA
STEYN JA )
F H GROSSKOPF JA ) CONCUR VAN DEN HEEVER JA) NICHOLAS AJA )