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[2019] ZASCA 89
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Beijers v Harlequin Duck Properties 231 (Pty) Ltd t/a Office Space Online (1216/2017) [2019] ZASCA 89 (31 May 2019)
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Non-Reportable
Case no: 1216/2017
In
the matter between:
DANIELLE
BEIJERS APPELLANT
and
HARLEQUIN
DUCK PROPERTIES 231 (PTY) LTD
t/a
OFFICE SPACE
ONLINE RESPONDENT
Neutral
citation:
Beijers v Harlequin Duck
Properties 231 (Pty) Ltd t/a Office Space Online
(1216/2017)
[2019] ZASCA 89
(31 May 2019)
Coram:
Cachalia, Majiedt, Zondi and Mocumie
JJA and Gorven AJA
Heard:
03 May 2019
Delivered:
31 May 2019
Summary:
Contract – interpretation of
non-variation clause – alleged oral agreement – estate
agent’s entitlement
to commission – evidence to
contradict express terms of a contract inadmissible.
ORDER
On
appeal from
:
Gauteng
Local Division, Johannesburg (Modiba J and Mia AJ sitting as a court
of appeal):
1 The appeal is upheld with costs.
2 The order of the high court is set
aside and substituted with the following order:
‘
The
appeal is dismissed with costs.’
JUDGMENT
Mocumie
JA (Cachalia, Majiedt and Zondi JJA and Gorven AJA concurring):
[1]
This is an appeal against the judgment and order of a full bench of
the Gauteng Local Division of the High Court, Johannesburg
(Mia AJ
with Modiba J concurring) (the full bench), upholding an appeal
against the regional court’s judgment and order,
and remitting
the matter to the regional court to consider further evidence. The
regional court had upheld the plaintiff’s
(Ms Danielle Beijers)
claim against the defendant, Harlequin Duck Properties 231 (Pty) Ltd
t/a Office Space Online, for the payment
of the amount of R205 000
plus interest and costs. It shall be convenient to refer to the
parties as they were referred to
in the regional court, as plaintiff
and defendant.
[2]
The material facts and issues can briefly be stated as follows. On 17
October 2011, the plaintiff and the defendant, an estate
agency in
Gauteng, entered into a written contract in terms of which the
defendant employed the plaintiff as a commercial property
broker on
commission only. It was agreed, that in the event that the plaintiff
was the ‘effective cause’ of a sale
of any property, the
defendant would pay the plaintiff commission on the terms set out in
clause 5.1 of the contract which clause
reads as follows:
‘
You
will be remunerated on a commission only basis. Commission shall
include any remuneration directly or indirectly earned in the
course
of business and will be calculated as follows:
50%
of total commission earned by the Company from Completed Deals
effected by yourself
(hereinafter
referred to as “Broker’s Commission”). A “Completed
Deal” is deemed to be a property
transaction which has been
invoiced by The Company AND payment for said invoice has been
received by the Company.’
[3]
The contract also includes a non-variation clause, clause 20, which
provides as follows:
‘
No
variation of this contract shall have any effect unless reduced to
writing and signed by both parties thereto. Any indulgence
or waiver
of the any of the terms of this contract will in no way affect the
right of any party thereto in enforcing any provision
thereof.’
There
are other clauses which bear on this matter. These include clause 21
which provides:
‘
This
contract constitutes the sole agreement between the parties and no
representation which is not contained in this agreement
shall be of
any force or effect between the parties.’
And
clause 23 provides:
‘
Prior
drafts of this contract shall not be admissible in any proceedings as
evidence in any matter relating to any negotiation preceding
the
signature of this contract.’
[4]
There are two transactions in issue. The parties refer to these as
the Woodmead and Chislehurston transactions. It is common
cause that
the plaintiff had been involved in the transactions concerned and
they were both completed deals within the meaning
of those words in
clause 5.1. The plaintiff was not paid her commission in full. In
consequence, during December 2013 the plaintiff
instituted action
against the defendant in which she claimed payment of the remaining
commission. The plaintiff relied on clause
5.1 (set out in paragraph
2). It alleged that she was the effective cause of both transactions.
In the counterclaim, the defendant
alleged that an oral agreement was
subsequently concluded between the defendant and the plaintiff in
terms of which the plaintiff
agreed not to be paid 50 per cent of the
commission earned in respect of the two transactions concerned, but
25 per cent of the
commission on each of the two transactions. In the
counterclaim the defendant claimed that it had overpaid the plaintiff
by an
amount of R30 750 which she was paid in respect of both
transactions. It claimed payment of the amount of R30 750 on the
basis
of unjustified enrichment. It should be mentioned that the
counterclaim was abandoned in argument before the regional court. In
its heads of argument, the defendant sought to clarify what its real
defence was. It stated that it denied that the plaintiff effected
certain completed deals. But this defence contradicts the agreed
statement of issues by the parties in the regional court.
[5]
The plaintiff, in her evidence, maintained that she was the
‘effective cause’ of both transactions. She had known
the
buyer previously and had started negotiations with him. The buyer had
been interested in buying property in Woodmead. He also
wanted to
sell his own property in Chislehurston. These were back-to-back
transactions, meaning the success of one depended on
the success of
the other. The plaintiff stated that she had done virtually
everything to complete the deals and that Mr Bosman
had, upon his
insistence, attended one or two meetings with the client. Mr Bosman,
she stated, had also communicated with the client
contemporaneously
with her. She was adamant that without her efforts, the transactions
would not have been concluded successfully.
Although Mr Bosman
assisted with one transaction when she was overseas, that transaction
had already been concluded between the
parties. Ultimately, it was
conceded by the defendant that she was at least one of the effective
causes of the completed deals.
Mr Bosman made this concession in
evidence. He conceded that it had never been put to the plaintiff
that he was the effective cause
of both transactions. After a number
of questions and answers he agreed that he was not the only effective
cause. He testified
that he was not saying that the plaintiff was not
effective in concluding the transactions. He only claimed that she
was ‘not
the effective cause on her own.’
[6]
The only issue remaining for determination in the regional court was,
therefore, whether the words ‘effected by yourself’
in
clause 5.1 meant the sole or only ‘effective cause’ of
the transactions.
[7]
The regional court accepted the evidence of the plaintiff regarding
her role in the transactions together with Mr Bosman’s
concession. Importantly, the regional court disallowed evidence on
the oral agreement contended for by the defendant. It dismissed
the
defendant’s counterclaim, which had not been persisted with in
argument. The full bench set aside the judgment and order
of the
regional court and remitted the matter to it ‘to consider
further evidence the parties may lead’. In the absence
of
specificity on the nature of the evidence to be led, it must be
accepted that the evidence referred to by the full bench related
to
the evidence regarding the alleged prevailing practice of ‘commission
splitting’ outside of the written contract
which, according to
the defendant, the parties had agreed to, in the meeting of 11 April
2013.
[8]
Before us, the following arguments were advanced. First, that on
construction of clause 5.1, unless the plaintiff was the sole
effective cause of a transaction, she would not be entitled to full
commission. In that instance, the practice of the defendant
would
govern how much commission would be paid by way of a tacit term.
Secondly, if that was not successful, that an oral agreement
concerning commission in those circumstances was admissible and had
been wrongly excluded by the magistrate. An aspect of this
was that
an agent would share her 50 per cent commission with an agent who
provided assistance. We were urged to accept that evidence
as part of
the admissible ‘context’ or ‘surrounding
circumstances’ when interpreting a contract in line
with
decisions of this court.
[1]
[9]
The parties agreed that clause 5.1, read in its plain language, is
not ambiguous. This calls for an interpretation of the relevant
clauses of the contract, being clause 5.1 which must be read in
conjunction with clauses 20 and 21. As to the point of
interpretation,
the defendant relied on the words in clause 5.1
‘effected by yourself’ to submit that this meant
‘effected
by you alone’. The clause cannot bear that
construction. The plain meaning of the clause is that commission is
paid on all
transactions effected by the plaintiff. As for the
importation of a tacit term, this relates to the payment of
commission. In the
first place, no such term was pleaded. Secondly,
the entitlement to commission is expressly dealt with. Any additional
term amounts
to a variation of the express terms. This is excluded by
clause 20 of the contract. The question of whether evidence of an
oral
agreement can be led is dealt with in
KPMG
Chartered Accountants (SA) v Securefin Ltd & another
:
[2]
‘
First,
the integration (or parol evidence) rule remains part of our law.
However, it is frequently ignored by practitioners and
seldom
enforced by trial courts. If a document was intended to provide a
complete memorial of a jural act, extrinsic evidence may
not
contradict, add to or modify its meaning . . .’.
It
cannot be said that such evidence amounts to evidence of context or
surrounding circumstances. It is evidence which is at odds
with the
written contract. It is quite clear that the magistrate was correct
to exclude any such evidence. It is equally clear
that the full bench
erred in finding that such evidence should have been allowed and
referring the matter back for it to be led.
This is even clearer in
the present matter when clause 23 expressly excludes any prior
drafts.
[10]
The only way in which evidence contrary to the terms of the contract
could have been led was in support of a claim for rectification
of
the written contract. Rectification
is
a well-established common-law right that provides an equitable remedy
designed to correct the failure of a written contract to
reflect the
true agreement between the parties to the contract. It thereby
enables effect to be given to the parties' actual agreement.
[3]
However, the
defendant did not invoke rectification.
[11]
Over and above this, in light of clause 21 of the contract, which
provides that ‘this contract constitutes the sole agreement
between the parties and no representation which is not contained in
this agreement shall be of any force or effect between the
parties’,
the rhetorical question to ask would be, if splitting of commission
was such an integral part of the business of
the defendant, why would
it not include it in the clear terms of the contract of employment?
This is so that employees of the defendant,
the property brokers,
know without any doubt or recourse to extraneous evidence what they
are signing up for, in the event of a
dispute.
[12]
In the light of the evidence that both the plaintiff and Mr Bosman
were involved in securing both transactions, and that the
plaintiff
effected both transactions, the magistrate was correct. The full
bench misconceived the position. In the circumstances,
the appeal
ought to succeed.
[13]
In the result, the following order is made:
1 The appeal is upheld with costs.
2 The order of the high court is set
aside and substituted with the following order:
‘
The
appeal is dismissed with costs.’
_________________
B C Mocumie
Judge of Appeal
APPEARANCES:
For
Appellant:
W F Wannenburg
Instructed
by:
C R Bothma &
Jooste Attorneys, Johannesburg
Symington & De
Kok Attorneys, Bloemfontein
For
Respondent:
C Cothill
Instructed by:
Lee Wrench
Attorneys, Durban
Mervyn Joel Smith
Attorneys, Bloemfontein
[1]
Natal
Joint Municipal Pension Fund v Endumeni Municipality
[2012]
ZASCA 13
;
[2012] 2 All SA 262
(SCA);
2012 (4) SA 593
(SCA);
Bothma-Batho
Transport (Edms) Bpk v S Bothma & Seun Transport (Edms) Bpk
(802/2012)
[2013] ZASCA 176
;
[2014] 1 All SA 517
(SCA);
2014 (2) SA 494
(SCA)
;
Novartis v Maphil
(20229/2014)
[2015] ZASCA 111; 2016 (1) SA 518 (SCA); [2015] 4 All SA 417 (SCA).
[2]
KPMG
Chartered Accountants (SA) v Securefin Ltd & another
[2009]
ZASCA 7
,
2009 (4) SA 399
(SCA),
[2009] 2 All SA 523
(SCA) para 39.
[3]
GB
Bradfield
Christie's
Law of Contract in South Africa
7 ed (2016) at 383. See also
Intercontinental
Exports
(Pty)
Ltd v Fowles
[1999]
ZASCA 15
;
[1999] 2 All SA 304
(A) para 11.