Union Spinning Mills (Pty) Ltd v Paltex Dye House (Pty) Ltd and Another (453/2000) [2002] ZASCA 9 (22 March 2002)

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Union Spinning Mills (Pty) Ltd v Paltex Dye House (Pty) Ltd and Another (453/2000) [2002] ZASCA 9; 2002 (4) SA 408 (SCA) (22 March 2002)

THE
SUPREME COURT OF APPEAL
OF
SOUTH AFRICA
CASE NO. 453/2000
Reportable
In the
matter between
UNION
SPINNING MILLS (PTY) LIMITED Appellant
and
PALTEX DYE HOUSE (PTY) LIMITED First Respondent
PALTEX KNITTING (PTY) LIMITED Second
Respondent
_____________________________________________________________
CORAM: SMALBERGER ADP, HOWIE, ZULMAN AND NAVSA
JJA et
LEWIS AJA
HEARD: 5
MARCH 2002
DELIVERED: 22 MARCH 2002
_____________________________________________________________
Applicability, on the facts, of standard trading terms
JUDGMENT
ZULMAN
JA
[1]
This is an appeal with special leave against a judgment of the Full
Court of the Bophuthatswana High Court. The judgment is reported
as
Paltex Dyehouse (Pty) Ltd and Another v Union Spinning Mills (Pty)
Ltd
2000(4) SA 837 (BHC).
[2]
For the purposes of convenience I will refer to the parties as they
were at the trial. The plaintiff (the appellant) instituted
two
separate actions against the defendants (the first and second
respondents on appeal). The actions were consolidated.
[3]
In each of the actions the plaintiff sued the defendants for the
purchase price of yarn sold and delivered to the defendants during
the period August, October and November 1991. In each action the
defendants raised counter claims for damages. By agreement
a
preliminary issue fell to be decided by the trial court. The issue
is stated as follows in the judgment of the trial court:-
“
Which terms and conditions governed the contractual
relationship
between the plaintiff and the defendants”.
[4]
The plaintiff contended that the terms and conditions which governed
the contractual relationship between it and the defendants
were set
out in certain order confirmation documents which it posted to the
defendants. These terms and conditions were its standard
terms and
conditions relating to the supply of yarn to its customers. The
defendants denied receipt of such documentation and accordingly
knowledge of the standard terms and conditions. The defendants
averred that the yarn that it admitted receiving from the plaintiff
was defective and that it suffered damages as a consequence.
[5]
After hearing oral evidence, the trial court (Khumalo J) found for
the plaintiff. Leave to appeal was refused but in terms of an
order
granted by this Court leave to appeal to the Full Court of the
Bophuthatswana High Court was granted. The appeal was upheld.
[6]
The legal principles applicable to the imposition of standard terms
of contract are well known. They are clearly stated in
Christie
The Law of Contract
1
.
Furthermore, where a party alleges an agreement, that party bears
the onus of proving the terms of the agreement, even if this
involves
proving a limitation of liability or that exclusion clauses did not
form part of the agreement It is also necessary for
a party relying
upon special terms and conditions to prove that the document in which
such terms and conditions appear is the type
of document where the
recipient would expect to find such conditions and in addition that
reasonable steps were taken to bring the
conditions to the attention
of the recipient. (See for example
Stocks & Stocks (Pty) Ltd
v T J Daly & Sons (Pty) Ltd
2
and
Micor Shipping (Pty) Ltd v Treger Golf and Sports (Pty)
Ltd & Another.
3
)
[7]
The determination of the issue is essentially a factual one. Some
guidance as to how a court is to approach such a matter is to
be
found in the following remarks of Franklin J in
Micor Shipping
4
:-
“
Those cases show that in the case
of private individuals the Court requires positive evidence to show
some sort of office practice
from which the inference of posting can
be drawn.. But the
onus
remains on the plaintiff to prove that
the letter was sent; and even then the presumption means no more that
this; the fact that
the letter was posted is evidence from which the
inference that it reached the addressee may be drawn; but all the
circumstances
must be considered in order to decide whether on a
balance of probabilities that inference ought to be drawn;
Goldfields
Confectionary and Bakery (Pty) Limited v Norman Adam (Pty) Ltd
1950 (2) SA 763
(T) at p 768"
[8]
The plaintiff led evidence from a number of witnesses which dealt in
detail with the plaintiff’s office practice at the relevant
time
concerning the handling and confirmation of orders that it received
from customers via its representative, Mr Ferguson. Amongst
these
witnesses were Mr Scheffer, the plaintiff’s administration
director, Mrs Cusse, a sales administrator of the plaintiff and
Mr
Bester, an employee of the plaintiff in its sales and administration
department. I will deal more fully later in this judgment
with the
office practice in question.
[9]
Business dealings between the parties commenced during 1990.
Ferguson testified that he had acted as “agent” for the plaintiff
for approximately eight or nine years. (It would seem that in law
Ferguson was a broker and not an agent in the true sense.) The
plaintiff has its factory and principal place of business in Port
Elizabeth. He stated that he had knowledge of the plaintiff’s
prices, mode of operation and procedures for the delivery of yarn to
his customers. He described the
modus operandi
for placing
orders with the plaintiff as follows:-
(
1)
When he
received an inquiry from a customer for the supply of yarn, he would
inquire from the plaintiff whether the order could be
executed.
(2) If the plaintiff
was able to supply the yarn, he prepared a form or indent bearing his
firm’s name (Ferguson Agencies) and
entitled “O
rder
Confirmation
”. He despatched copies of the form to
the plaintiff and the customer. I will refer to this type of
document as “Ferguson’s
confirmation”.
(3) Thereafter he would receive one copy of a document
headed “Order Confirmation” from the plaintiff. I will refer to
this
type of document as “plaintiff’s confirmation document”.
This would take place a week or two after the despatch of Ferguson’s
confirmation.
(4) Ferguson checked plaintiff’s confirmation against
his confirmation before the delivery of the goods took place.
(5) According to Ferguson this procedure was followed in
every case with the defendants including the orders forming the
subject matter
of the dispute.
[10]
At the foot
of the plaintiff’s confirmation document the
following appears in capitals and in clear print:-
“
THIS
CONTRACT IS SUBJECT TO THE GENERAL CONDITIONS OF SALE APPEARING ON
THE REVERSE HEREOF. THE CUSTOMER’S ATTENTION IS DRAWN
SPECIFICALLY TO CLAUSE 19 THEREOF.
DELIVERIES
UNDER THIS CONTRACT WILL BE MADE IN ACCORDANCE WITH CREDIT INSURANCE
LIMITS.
”
(I
have sought to reproduce the same print size as appears on the
plaintiff’s confirmation document.)
Twenty-two
standard “Conditions of Sale” are printed on the reverse side of
the document. In its judgment the Full Court attached
a photostatic
copy of the terms and conditions describing them as being “in
minuscule print and difficult to read”. We have
been furnished
with a specimen of the actual document in question. In my view
although the conditions are printed in small type
they are legible.
In any event legibility was not an issue before us and counsel for
the defendants did not seek to attach any significance
to it.
[11]
Condition 19 provides as follows:-
“19.
Acceptance
of Conditions
19.1 Upon delivery of the Order Confirmation to the
Customer, the Customer shall, in the absence of signature of this
Agreement
by the Customer, be deemed to have accepted the terms and
conditions of this Agreement unless the Customer gives written notice
to
the contrary to the Company within 3 (three) days of receipt of
this Order Confirmation.
19.2 In the event of the Customer rejecting these
terms and conditions the Company shall be entitled in its discretion
to cancel
this agreement at any stage thereafter by giving written
notice to that effect to the Customer. In such event the Company
shall
not be liable for any direct or indirect loss suffered by the
Customer in pursuance of such cancellation.”
[12]
Condition 14 deals extensively with the question of warranties in
respect of goods supplied. In essence the company’s contractual
liability in respect of any latent or patent defect in the goods is
limited to the replacement of the defective goods or to the repayment
of the purchase price paid in respect of defective goods but the
company is not liable to the customer for any loss, including
consequential
loss, suffered by the customer (see conditions 14.7 and
14.8 respectively).
[13]
It is common cause that the defendants did not give any notice to
the plaintiff that they rejected the standard terms and conditions.

The defendants allege that they had never received the plaintiff’s
confirmation documents.
[14]
In their plea and counterclaims the defendants allege that
they, represented by their managing director, Mr Beraru, entered into
oral agreements of sale with the plaintiff, represented by Ferguson,
at the plaintiff’s principal place of business, for the supply
of
various quantities of cotton yarn; that it was an express or
alternatively an implied or tacit term of the agreements that the
cotton yarn would be of good quality and would be free from defects,
in particular that the yarn would be fit for the purpose for
which it
was manufactured; and that it was in the contemplation of the
parties when the agreements were concluded that the defendants
would
suffer certain consequential damages if the yarn were not of good
quality. In its amended plea to the counterclaim the plaintiff
avers that its liability in respect of defective material (it being
denied that defective material was delivered by it to the defendants)
was limited to the remedies and procedure provided for in condition
14 of the Conditions of Sale.
[15]
Scheffer gave evidence as to the operation of the plaintiffs
internal system. He was responsible for customer service as well
as
the processing of orders received by the plaintiff from customers.
He testified that the processing of an order would be dependent
on
various factors, particularly whether the plaintiff could meet the
required delivery dates. He stated that after an order was
accepted
from a representative such as Ferguson or directly from a customer,
four copies of the plaintiff’s confirmation documents
were
generated by the plaintiff’s computer - a green, a pink, a blue and
a yellow copy. The green and pink copies were posted
to the
customer. The intention was that the pink copy would be signed by
the customer and returned to the plaintiff, signifying
agreement with
the standard terms. The yellow copy was posted to the agent and the
blue copy was retained by the plaintiff. The
standard terms and
conditions to which I have referred were printed on the reverse side
of all four copies. Scheffer positively
asserted that the
plaintiff’s system ensured that such confirmation documents were
placed in envelopes and posted to customers.
He was sure that
confirmation documents would have been posted to the defendants
although he personally did not do the posting.
For a delivery to be
effected by the plaintiff, the plaintiff would generate an invoice, a
packing list and a delivery note. Scheffer
prided himself on the
efficient running of his department. He personally ensured that
“
paper work
” was timeously executed and that
all necessary documentation was sent to customers and agents. He
testified that no post addressed
to either of the defendants had ever
been returned to the plaintiff as having been uncollected. If
documentation was returned
by the post office it was referred to him
and he would personally ascertain the reason for the return and would
take steps to rectify
the position. Scheffer confirmed that
Ferguson had taken the initial orders from the defendants and used
his own confirmation document.
[16]
Cusse also gave evidence in regard to the procedure which was
followed in the sales administration department of the plaintiff
company. Scheffer was her immediate superior. She described
Scheffer as a meticulous person who ensured that the office under his
control should “
run like clockwork
”. She
corroborated Scheffer in regard to the plaintiff’s system and
method in regard to orders, order confirmations and all
the relevant
documentation. Generally, Scheffer signed the plaintiff’s
confirmation documents. Cusse personally, or through
the staff
immediately under her control, ensured that the plaintiff’s
confirmation documents were placed in correctly addressed
envelopes,
were franked and taken by a driver to the post office. She asserted
that Scheffer checked regularly to see that the post
had been
timeously despatched. In cross-examination she was perplexed to hear
that the defendants contended that they did not receive
a single copy
of the plaintiff’s confirmation documents. Her view was that this
was impossible. Cusse also testified that invoices
were generated
in her department and were posted in the same manner as the
plaintiff’s confirmation documents.
[17]
Bester gave evidence about the system employed by the plaintiff and
corroborated both Scheffer and Cusse.
[18]
Three customers of the plaintiff who had no connection with the
defendants testified on behalf of the plaintiff. Each of them had
placed orders with the plaintiff over a substantial period. They
stated that they always received the plaintiff’s confirmation
documents in the post as well as the invoices and other documents
described by Scheffer and Cusse. Two of them testified that they
actually read the terms and conditions appearing on the reverse side
of the plaintiff’s confirmation document.
[19]
None of the aforegoing evidence was seriously challenged by the
defendants
[20]
Reverting to the evidence of Ferguson, he also testified that he
received the plaintiff’s confirmation documents. He referred
to
his own confirmation documentation which states at the foot:-
“
Orders are accepted by us as Agents only and are
subject to Supplier’s confirmation. Neither the Suppliers nor
ourselves can be
held responsible for delays of delivery of goods
caused by Strikes, Lock-outs, Prohibition of Import or Export or
other circumstances
or contingencies unavoidable or beyond our
control, Force Majeure or Act of God. We are acting as Agents only
and accept no responsibility.”
He testified about a meeting at the plaintiff’s
premises in Port Elizabeth during 1991 when there were discussions
concerning the
plaintiff’s terms and conditions for the supply of
yarn. Mr Snijman, a director of the plaintiff, and Beraru were
present.
According to Ferguson, Snijman bluntly told Beraru that if
the defendants were not satisfied with the plaintiff’s yarn they
must
stop ordering it. Snijman indicated, according to Ferguson,
that the plaintiff’s attitude was based upon the existing terms and
conditions of sale. Ferguson also gave evidence to the effect that
he visited the defendants’ premises on a reasonably frequent
basis.
He estimated that the defendants ordered approximately 30 to 40 tons
of yarn per month from the plaintiff. On the occasion
that they met
in Port Elizabeth Beraru complained about the dye on the cotton not
having come out correctly.
[21]
Snijman in his evidence stated that he was not involved in the
processing of the day to day orders taken by the plaintiff. He
recalled three occasions when he had had discussions with
representatives of the defendant. The first was in April/May 1990 at
the
defendants’ factory at Garankuwa. The second was in 1991 also
at the defendants’ factory. The third occasion was on 24 September
1991 when Beraru came to Port Elizabeth. On the two occasions that
he visited the defendants’ premises he was accompanied by
Ferguson.
The Port Elizabeth meeting concerned a complaint about yarn. As a
result a piece of cloth was sent to the CSIR in Port
Elizabeth for
testing. Snijman made it clear to Beraru that any complaints would
be dealt with in accordance with the plaintiff’s
terms and
conditions and that no claims for consequential loss would be
entertained by the plaintiff. He testified that it was possible
to
check the suitability of cotton in a matter of days by dyeing a
sample. He said that if the defendants thought that the conditions
of sale did not give enough time to test the cotton it was open to
them to refuse to accept the yarn. He further said that the
plaintiff
did not consider it necessary to insist on the return of
pink copies of the plaintiff’s confirmation documents because this
was
considered to be superfluous. He made it plain that he wanted
Beraru to understand that the plaintiff had a standard procedure for
all its customers. He denied that reliance on the conditions of sale
was an afterthought.
[22]
The defendants called two witness in support of their contentions.
The first was Mrs Verhoef who testified that she was employed
by the
defendants from the beginning of 1991 until the end of 1994 as a
secretary. She performed these duties for Beraru and Mr
Brin who
was also a director of the defendant company. According to her Brin
generally dealt with deliveries. She said she did
not receive much
post at the time. She could not recall what documentation she
received from the plaintiff apart from packing slips.
She had a
vague recollection of the relevant events and facts. When she was
giving evidence she repeatedly said that she “could
not recollect”
or “did not remember”. She, however, remembered receiving orders
from Ferguson by fax. She could not recall
receiving any documents
which were pink or green; she remembered only white documents.
Beraru was away much of the time and mail
was kept for him in a file
for his attention until he was available to read it. According to
her when Beraru spent time at the defendants’
premises in Garankuwa
“he would look at all our documents that we had received in the
past month or two that he was not there.
If anything was not right
or done right, he would get angry. He was very precise on what his
documents had to look like and what
he had to receive. If he had not
received a document and he was expecting it he would ask us for it,
we would have to look for it.”
In cross-examination she admitted
that her memory of the events was very vague. She said that all the
documents she received were
filed in a secure cabinet. She also
conceded that invoices were received through the post from the
plaintiff. She also testified
that Brin and Beraru “had all the
documents or looked at all the documents that I had to give them
through the post.” Brin was
not called to give evidence.
[23]
Beraru testified that he was the managing director of the
defendants from 1990 to 1992. He spent approximately ten days out of
every two months at the premises of the defendants. During these
visits he checked all correspondence, all accounts and invoices.

These were filed. He also enquired about progress at the production
facility of the defendants. He testified that the plaintiff
was the
defendants’ sole supplier of cotton yarn. All orders placed by the
defendants were placed through Ferguson. The defendants
received
indents from Ferguson. He claimed that the indents contained all the
relevant terms of the contract with the plaintiff.
According to
Beraru he at no time saw any of the plaintiff’s confirmation
documents containing terms and conditions of sale.
If he had
received such documentation he would “immediately” have
approached his attorney for advice concerning the conditions
and he
would “never have agreed” to condition 14 appearing on the
reverse side of the plaintiff’s confirmation document because
it
was impossible “to see immediately a defect in the yarn” and
react timeously. Beraru testified that he met Snijman on at
least
two occasions, the latter being at the plaintiff’s premises in
Port Elizabeth. During this meeting Snijman said that the
plaintiff
did not guarantee that there were no defects in the yarn and that if
the defendants did not like it they must stop buying
the yarn.
Beraru had brought to Snijman’s notice certain defects in yarn
supplied. He had had many years of experience in the
textile
industry and was aware of the importance of standard terms and
conditions. He said conditions of sale which existed in South
Africa
did not apply in other countries. He confirmed that his own company
had its own standard terms and conditions of sale which
had been
prepared by the defendants’ attorneys.
[24]
A trial court has the obvious and important advantage of seeing and
hearing the witnesses and of being steeped in the atmosphere
of the
trial. These advantages were not possessed by the Full Court and
indeed this Court. Although courts of appeal are slow to
disturb
findings of credibility they generally have greater liberty to do so
where a finding of fact does not essentially depend
on the personal
impression made by a witness’s demeanour but predominantly upon
inferences from other facts and upon probabilities.
In such a case a
court of appeal with the benefit of an overall conspectus of the full
record may often be in a better position
to draw inferences,
particularly in regard to secondary facts. (See, for example,
R
v Dhlumayo and Another
5
,
S v Robinson and Others
6
and
Hoffman and Zeffertt
– The South African Law of
Evidence
7
.)
[25]
In his evaluation of the evidence Khumalo J commented as follows:-
“
The plaintiff’s witnesses have corroborated one
another on important aspects affecting the issue to be decided.
Their demeanour
cannot be faulted and was not criticised nor was
their credibility attacked. The defendants’ witness Mrs Verhoef
appeared to
be an honest witness but the difficulty I have with her
evidence is that her recollection of events was very poor and the
statements
she made were repeatedly qualified by her uncertainty as
to what documents were received at the time. She vaguely remembered
invoices
and statements. She also thought that she had seen one
order confirmation. Her evidence is dangerously unreliable. The
evidence
of Mr Beraru also suffers certain defects. Although he
appeared honest a number of questions remain unanswered.”
[26]
In discussing the evidence of Beraru the learned trial judge said
that if Beraru’s evidence was scrutinised carefully “
the
impression I get is that honest as he may be, he was not adequately
informed about what was happening within the companies
.”
It seemed a case of “
the right hand not
knowing what the left hand does
”.
[27]
Refusing an application for leave to appeal, Khumalo J specifically
rejected as being incorrect an argument addressed to him by
counsel
for the defendants that he had made no credibility findings on any of
the witnesses called at the hearing. He then went
on to refer to
passages in his judgment dealing with the credibility of the main
witnesses and concluded:-
“
From all these extracts it is clear that I believe
the witnesses of the respondent and not those of the applicant.
Credibility did
play a role in the matter. As correctly pointed out
by Mr Buchanan the determination of the credibility of witnesses was
obviously
inextricably bound up with the overwhelming probabilities
which support the respondent’s version.”
In my view Khumalo J was overly generous in his
assessment of Beraru’s evidence. A careful consideration of his
evidence leaves
me with the distinct impression that Beraru was
untruthful more particularly when he stated that he saw no
documentation emanating
from the plaintiff which contained
contractual terms such as those set out in the plaintiff’s
confirmation documents.
[28]
In my view the learned trial judge was correct in his assessment of
the probabilities which I believe fully support the plaintiff’s
version. Some of the more important probabilities which favour the
plaintiff’s case are the following:-
(1) It is remarkable that other documentation such as
invoices and statements which were sent to the defendants in the same
manner
as the plaintiff contends the confirmation documents were
sent, were admittedly received by the defendants, but the plaintiff’s
confirmation documents were not.
It is strange also that other customers of the
plaintiff who
testified at the trial received the plaintiff’s
confirmation documents, which they read, but that the defendants
allegedly did not
receive such documents.
(3) On the probabilities documentation that was
received at the defendants’ offices such as the plaintiff’s
confirmation documents
would have come to Beraru’s attention.
(4) Beraru stated that he was aware that orders had
been booked to the second defendant (Paltex Knitting (Pty) Limited)
because the
first defendant (Paltex Dye House (Pty) Limited) was no
longer covered by credit insurance. He stated that a certain Mr Mor
who
was employed by the defendants at the relevant time had requested
this arrangement from the plaintiff but that he had no authority
to
do so. Credit insurance is a matter covered by clause 20 of the
terms and conditions of the confirmation document. It is also
referred to in the endorsement in the left hand corner of the
confirmation document. It is strange how Mor would have known about
this if he had not seen the confirmation documents in question. The
probability is that he would have reported it to his superior,
Beraru. If he did not know about this how he was able to discuss the
matter with Ferguson or Scheffer? Mor was not called as a
witness.
(5) It is also not improbable that Beraru had been
given the documentation and simply did not trouble to read it or
apply his mind
to it. His immediate concern was to get delivery of
the yarn.
(6)
Ferguson’s
confirmation had a clear endorsement on it to the effect that the
plaintiff was to “confirm” every order placed through
Ferguson.
It is passing strange why the plaintiff would not confirm orders
received in its standard manner and send the confirmation
to the
defendants.
(7)
Beraru was
away from the defendants’ premises for much of the time. In the
circumstances he may not have been sufficiently informed
as to what
orders, executed by Brin, were confirmed in his absence. Even though
there was no onus on the defendants in this regard,
it is a matter
for comment that they chose not to call Brin to testify, especially
since he was responsible for the day to day running
of the business
of the defendants in the absence of Beraru.
(8) This is not a case of a single confirmation
document being lost in the post but, on the defendants’ case, a
significant number
of such documents, properly addressed to the
defendants and posted over a substantial period of time, not reaching
their destination.
(9)
Although the
defendants acknowledge receiving documents such as invoices, delivery
notes and packing slips from the plaintiff no explanation
was given,
although this was requested by the plaintiff, why these documents
were not discovered when a discovery affidavit was deposed
to, and a
reply given to a rule 35(3) notice, neither of which made reference
to the defendants ever having had such documentation.
[29]
In my view the judgment of the Full Court was, with respect,
incorrect where it stated “
the plaintiff relies on the
following proposition - that the mere posting of the order
confirmation to the defendants, is proof of
its receipt
”.
The evidence and the argument reveals that the plaintiff did not
rely upon mere posting alone but upon the totality of the
facts,
particularly concerning its practice and method of confirming orders
received from its representative.
[30]
I believe that the Full Court also erred in its view that had Beraru
received, or been aware, of condition 14 of the conditions
of sale he
would never have been prepared to agree to it because, having regard
to the production process of the defendants, defects
may have
manifested themselves only after the expiry of 30 days. This
contention loses sight of the fact that evidence was given
by Snijman
to the effect that late claims would have been considered and that in
any event if Beraru had wished to debate this clause
before the
orders were executed he could easily have done so.
[31]
In my view there is also no support for the conclusion of the Full
Court that the terms contained in the plaintiff’s confirmation
documents were imposed after the orders were placed and that they
differed from what had been agreed upon. The totality of the
evidence
reveals that it was part of the plaintiff’s system of
acceptance of orders, and thus part and parcel of the contractual
process,
that orders placed with Ferguson were confirmed only upon
the terms set forth in the plaintiff’s confirmation documents.
This
is not a question of a belated variation of a contract to
incorporate standard terms and conditions. The terms here were part
of
the contract concluded. The contract only came into being upon
the non-rejection by the defendants of the terms of the confirmation
documents, as provided for in condition 19.1.
[32]
The judgment of the Full Court is also erroneous in so far as it
suggests that what it considered harsh conditions imposed a greater
burden of proof upon the plaintiff than the normal burden of a
balance of probabilities. The type of conditions which are found
in
the plaintiff’s confirmation documents are standard conditions
relating to the supply of manufactured goods. Indeed, Beraru
in his
evidence went so far as to state that his company employed similar
conditions in supplying its customers with goods. This
latter fact
also lends support to the proposition that the plaintiff’s
confirmation document is the type of documentation which
a purchaser
of the goods in question would expect to receive and expect to find
conditions in. (See, for example,
Micor Shipping
8
).
[33]
In argument before this Court counsel for the defendants, whilst not
conceding that the plaintiff had established that its confirmation
documents had been sent and probably received by the defendants
stressed, if I understood the argument correctly, that the defendant,
represented by Beraru, concluded an oral agreement with Ferguson, in
the terms set out in the body of Ferguson’s confirmation document,
for the supply of cotton yarn at the prices specified and for
delivery as stated therein; and that the words appearing at the foot
of that document were to be ignored, or at least meant no more than
that the plaintiff was to “confirm” post-contractually what
was
already agreed by way of Ferguson’s confirmation.
[34]
These contentions were never put to Ferguson or any of the
plaintiff’s witnesses, nor led in the evidence-in-chief of Beraru.

The whole focus of the proceedings before the trial court was simply
directed towards ascertaining whether the defendants ever received
the plaintiff’s confirmation documents. Counsels’ contentions
are in any case untenable, for the following reasons:-
(1)
There is no
evidence to support the proposition that Ferguson who, as I have
already indicated, was more a broker and not the plaintiff’s
agent
in the legal sense, had any authority to conclude such an agreement
The terms printed at the foot of Ferguson’s confirmation
state
clearly that Ferguson acted as “Agent only and accepted no
responsibility”.
(2) The “confirmation” required from the plaintiff
was not merely to confirm the terms set out regarding price and
delivery as
set out in Ferguson’s confirmation but to stipulate the
terms and conditions upon which the yarn was to be supplied. The
argument
entirely ignores the true effect of the terms and
conditions set out in the plaintiff’s confirmation document and its
role in
effecting conclusion of the parties’ contracts of sale.
[35]
In my view the plaintiff established on a clear balance of
probabilities not only that it sent its confirmation documents to
the
defendants (a matter not really in dispute) but that:
(1) As a matter of fair inference, such documentation
was received by the defendants.
(2) The documentation was of the type on which a
reasonable purchaser would expect to find standard terms and
conditions.
(3) The plaintiff had done all that was reasonably
necessary to bring the terms and conditions to the defendants’
attention.
(4) In all the circumstances the terms and conditions
set out on the reverse side of the plaintiff’s confirmation
document “governed
the contractual relationship between the
plaintiff and the defendants”.
(5) In any event Beraru, who read all relevant
documentation carefully, either read the terms and conditions or knew
of their existence.
(6) The confirmation documents preceded deliveries in
every case.
[36]
In the circumstances the parties’ contracts were governed by the
plaintiff’s standard terms and conditions, as held by the trial
Court.
[37]
The appeal is accordingly allowed with costs and the order of the
Full Court is set aside. Substituted for it is the following:
“
The appeal is dismissed with costs.”
----------------------------------------
R
H ZULMAN
JUDGE
OF APPEAL
SMALBERGER
ADP )
HOWIE
JA ) CONCUR
NAVSA
JA )
LEWIS
AJA )
1
4
th
Edition Pages 204 - 209
2
1979(3) SA 754 (A) at 765A – 767C.
3
1977(2) SA 709 (W) at 713 H –
714 F.
4
Supra at 715 A – C.
5
1948 (2) SA 677
(A) at 698
6
1968 (1) SA 666
(A) at 675 G - H
7
4
th
Edition pages 489/490
8
Supra at 713 H – 714 A