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[2014] ZAWCHC 210
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Owners Underwriters And parties who Bear Risk And to the Pontoon Margaret And the Cargo of two Floating Docks And Twelve Barges v Tug Salvatiant Admiralty Action in Rem, In re: Handel and Another v Semco Salvage VI Pty Ltd and Another (AC144/10) [2014] ZAWCHC 210 (4 December 2014)
In
The High Court of South Africa
Western
Cape Division, Cape Town
Exercising
its Admiralty Jurisdiction
Case
no: AC81/09
DATE:
04 DECEMBER 2014
In
the matter between:
THE
OWNERS, UNDERWRITERS AND PARTIES
WHO
BEAR RISK IN AND TO THE PONTOON
“
MARGARET”
AND THE CARGO OF TWO
FLOATING
DOCKS AND TWELVE
BARGES
.....................................................................
Plaintiffs
And
Tug
“Salvaliant”
.......................................................................................................................
Defendant
Admiralty
Action in Rem
AND
Case
No: AC144/10
In
the matter between:
L.J.
BOER HANDEL
B.V
..................................................................................................
First
Plaintiff
L.J.
BOER VASTGOED
B.V
.........................................................................................
Second
Plaintiff
And
SEMCO
SALVAGE (VI) PTY
LTD
...............................................................................
First
Defendant
POSH
SEMCO PTE
LTD
...........................................................................................
Second
Defendant
Admiralty
Action in Personam
Date
of hearing: 14-15 October 2014
Date
of judgment: 4 December 2014
Judgment
SAVAGE
AJ
:
Introduction
[1] On 21 April 2009
the mt “Salvaliant”, a Singaporean-flagged ocean going
salvage Tug took up the Tow, being the pontoon
‘Margaret’
and her cargo of two floating docks and twelve barges, and proceeded
to tow the Tow around the Cape of Good
Hope towards Rotterdam,
Netherlands. During 22 and 23 June 2009 and after rounding the Cape
of Good Hope, the Tug and the Tow encountered
stormy weather with
gale force winds and a heavy storm. The tow line parted on 23 June
2009 and the Tow ran aground on the Jacobs
Bay reef, north of
Saldanha Bay on 24 June 2009 causing the Tow to suffer irreparable
damage and be wrecked.
[2] In 2009 the
Owners and Parties who bear the Risk in and to the pontoon ‘Margaret’
and the Cargo of the Two Floating
Docks and Twelve Barges instituted
an admiralty action
in rem
against the Tug. Thereafter in 2010
the first plaintiff, L.J. Boer Handel B.V. (“Handel”) and
the second plaintiff,
L.J. Boer Vastgoed B.V. (“Vastgoed”),
both companies incorporated according to the laws of the Netherlands
with their
respective principal places of business in Sliedrecht,
Netherlands, instituted an admiralty action
in
personam
against Semco Salvage (VI) Pte Ltd, as the Tug-owner, and Posh Semco
Pte Ltd, as salvor and towage company, both companies incorporated
and carrying on business in Singapore. In both actions the
plaintiff(s) seek payment of €34,236,368.26, US$2,057,500.00 and
R10,919,417.96 plus interest and costs. Attached to the particulars
of claim in both actions was annexure POC1 in which the quantum
of
the plaintiffs’ claims was detailed.
[3] The action
in
rem
and action
in personam
have been consolidated for
hearing at a trial which was initially set to commence in October
2014 but is currently to commence
during March 2015, with the
following applications now before this Court for determination:
i. the plaintiffs’
application for leave to further amend the particulars of claim in
both actions;
ii. the defendants’
application in terms of Admiralty rule 20 for an order striking of
the plaintiffs' application to amend
the particulars of claim as an
irregular proceeding; and
iii. the defendants’
application to compel a proper response by the plaintiffs to the
defendants’ request for trial
particulars.
Application for
leave to amend particulars of claim
[4] On 12 August
2014 the plaintiffs gave notice of their intention to seek an
amendment to the particulars of claim in the consolidated
actions.
Having opposed the application to amend, the defendants abandoned
their objection to the amendments in paragraphs 1.2.2,
1.2.3, 1.2.4,
1.3.2, 1.3.3 and 1.3.4 of the notice of motion. Accordingly, under
admiralty rule 22(9), these amendments are deemed
to have been
effected and the particulars of claim amended in these respects. The
remaining amendments sought in paragraphs 1.1,
1.2.1, 1.2.5, 1.2.6,
1.3.1, 1.3.5 and 1.3.6 of the notice of motion seek the substitution
of the current POC1 to the particulars
of claim in both actions and
the amendment of the damages amount claimed from €29,011,712.61
to
€
28,611,712.61. The defendants
persist with their opposition to these amendments.
[5] The defendants’
objection centres on paragraphs 2.1 and 2.2 of the proposed annexure
POC1, which relate in the main to
paragraph 10.4 of the action
in
rem
and to paragraph 16.4 of the action
in personam
.
Paragraph 10.4 of the action
in rem
details the plaintiff’s
claim for damages in the amount of
€
13,639,104.90
being for Boer’s estimated loss of income. Paragraph 16.4 of
the action
in personam
details the plaintiffs’ claim for
damages in the amount of the
€
13,639,104.90
for loss of profits.
[6] Paragraph 4 of
the existing POC1 reads as follows:
“
4
LOSS OF PROFITS
4.1
Hoek en Blok accountants invoices for
calculating
loss of profit
4.1.1
26.10 .09
€
18, 159.40
4.1.2
18.11 .09
€
19, 635.00
4.1.3
21.01.10
€
17, 790.50
€
55,
584.90
4.2
Loss of profits claim iro loss of use
of
the Floating Dock:
4.2.1
As per calculation by Hoek en Blok of
8
Feb 2010, extrapolated for 6 years, rather
than
the 2 years used in the calculation
=
€ 877, 840.00 or € 438, 920.00
per
annum
-
therefore 6 x € 438, 920.00 € 2,633,520.00
4.3
Loss of profit claim iro the use of the
pontoon
“Margaret”
4.3.1
€ 5000.00 per day (being the rate secured from Mertrade
per Charter agreement) for 6 years 365
x
€
5000 x 6
years € 10,950,000.00
total
loss of profits claim € 13,639,104.90
”
[7] In the report
which was addressed to L.J. Boer Handel B.V. by auditors Hoek and
Block dated 8 February 2010 to which reference
is made paragraph
4.2.1 of the existing POC1, the operating budget ‘
prepared
for the dock that was lost due to the events on the coast of South
Africa
’ was recorded as € 877,840.00.
[8] The plaintiffs
first sought that POC1 be amended under the heading ‘(l)
oss
of profit claim iro loss of use of the Floating Dock
’ at
2.1.2 to the amount of
€2,970,000.00 for
‘(l)
oss of rental suffered by L.J. Boer Vastgoed BV
from September 2009 to September 2015, calculated on loss of rental
of
€ 495,000.00 per annum for 6
years
’; and a similar loss of
profit claim in respect of the use of the pontoon “Margaret”
under 2.2 in the amount
of €
4,641,000.00
‘
arising
from loss of charter hire by L.J. Boer Vastgoed BV, calculated on a
daily rate of € 4,250 for 26 weeks per year, for
6 years
’.
The plaintiffs abandoned this proposed POC1, following opposition by
the defendants.
[9] The plaintiffs
then put up the current proposed version of POC1. It is this proposed
version that is the subject of the current
application for amendment.
In this proposed POC1, headed ‘
Plaintiffs’ Quantum of
Claim Schedule
’ paragraphs 2.1 and 2.2 are styled 'loss of
profits' claims in respect of the pontoon, Margaret, and the two
sections of
the floating dock:
“
2 LOSS
OF PROFITS arising out of the loss of the floating dock and pontoon
2.1
Loss of profit claim iro loss of use of the Floating Dock
2.1.2
Loss of rental suffered from September
2009
to September 2015, calculated on
loss
of rental of € 495, 000.00
per
annum for 6 years € 2, 970, 000.00.
2.2
Loss of profit claim iro the use of the pontoon “Margaret”
2.2.2
Loss of profit arising from loss of charter hire,
calculated
on a daily rate of € 4,250.00 for
26
weeks per year, for 6 years
€ 4, 641, 000.00
TOTAL
LOSS OF PROFITS CLAIM
€ 7,611,000.00
”
[10] In this
proposed POC1 the reference to Vastgoed contained in the earlier
version put up by the plaintiffs has been removed.
[11] The
distinctions between the loss of profits claim quantified in respect
of the pontoon and floating dock in the existing POC1
and the
proposed POC1 are as follows:
11.1 In the existing
POC1, the loss of profits claim in respect of the floating dock is
detailed ‘(a)
s per calculation by Hoek en Blok of 8 Feb
2010, extrapolated for 6 years, rather than the 2 used in the
calculation…
’ with a total of € 2,633,520.00
claimed, whereas the proposed POC1 details this claim as ‘(l)
oss
of rental suffered from September 2009 to September 2015, calculated
on loss of rental of € 495, 000.00 per annum for 6
years
’
with a total amount of € 2,970, 000.00.
11.2 In the existing
POC1 the loss of profits claim in respect of the pontoon is stated as
“€
5000,00 per day (being the rate secured from Mertrade
per Charter agreement) for 6 years 365 days x €5000 x 6 years €
10,950,000.00
’, whereas the proposed POC1 details it as a
‘(l)
oss of profit arising from loss of charter hire,
calculated on a daily rate of € 4,250.00 for 26 weeks per
year, for
6 years’ in a total amount of € 4, 641, 000.00’
;
11.3 Total loss of
profits in the amount of €13,639,104.90 are claimed in the
existing POC1 whereas in the proposed POC1 the
total amount is stated
to be €7,611,000.00.
[12] The defendants
object to the introduction of paragraphs 2.1 and 2.2 amended proposed
POC1 on the basis that –
12.1 if the
amendment were permitted, it would have the effect that the claim for
loss of profits would be one advanced by Vastgoed
when it was neither
the owner nor possessor of the pontoon or floating dock at the time
of the stranding and therefore, as a matter
of English law, it has no
claim for such a loss and to allow the amendment would render the
particulars of claim excipiable; and
12.2 to the extent
that South African law applies, the particulars of claim as
formulated lack the requisite allegations to support
a claim for loss
of profits by Vastgoed and would therefore be excipiable to the
extent that the amendment was made.
[13]
Uniform
rule 28 governs the amendment of pleadings, with the Court granted a
wide discretion under rule 28(10) to grant leave to
amend any
pleading or document. In granting amendments the Court the greatest
latitude to effect amendments
[1]
the general rule is that an amendment will be allowed where it
permits the ventilation of the real issues between the parties in
order that justice is done,
[2]
except where it is
mala
fide,
causes prejudice or injustice which cannot be compensated by an order
for costs or, where appropriate, a postponement. An amendment
will
generally not be allowed where its introduction into the pleading
would render such pleading excipiable,
[3]
save for exceptional cases where the balance of convenience or some
such reason might render another course desirable.
[14] It is apparent
from paragraph 10.4 of the particulars of claim in the action
in
rem
and paragraph 16.4 of the action
in personam
that it
is the plaintiffs, Handel and Vastgoed, who seek damages for loss of
income (in the
in rem
action) and loss of profits (in the
in
personam
action) as a consequence of the stranding. These claims
follow averments made in the amended particulars of claim regarding
the
ownership of the property. At paragraph 2 of the particulars of
claim in the action
in rem
it is
pleaded
that Vastgoed was the owner of the twelve barges, while Handel was
the owner of the pontoon “Margaret” and two floating
docks. At paragraph 3 of the amended particulars of claim in the
action
in personam
it is pleaded that:
‘
3.
At all material times:
3.1
the first plaintiff, alternatively the second plaintiff, was the
owner of the pontoon ‘Margaret’ and two floating
docks
and/or bore the risk therein;
3.2
the second plaintiff, alternatively the first plaintiff, was the
owner of the twelve barges loaded aboard the ‘Margaret’
and/or bore the risk therein.’
[15] It follows from
the particulars of claim therefore that in the action
in rem
a
claim for loss of income is pursued against the defendant by the
plaintiffs in circumstances in which the ownership of the property
is
specifically pleaded. In the action
in personam
a loss of
profits claim is pursued by the plaintiffs in circumstances in which
the one plaintiff has been pleaded as the owner,
with the other
plaintiff pleaded in the alternative as the owner of the same
property. The plaintiffs have not made out a claim
for pure economic
loss in their particulars of claim, nor have they alleged that the
defendants’ conduct vis-à-vis
Vastgoed was wrongful. The
defendants contend that there are no facts pleaded from which
wrongfulness may be imputed or inferred.
[16] In particulars
provided to the defendants for purposes of trial the plaintiffs
stated that ownership and risk in the pontoon
and the barges was
transferred by Handel to Vastgoed on 23 March 2009, being the date
when Mr Leo Boer signed the notarial deeds
of sale giving effect
thereto before the notary in Sliedrecht, Holland, and effected on
that date. Ownership in the pontoon was
then transferred back to
Handel on 15 April 2009, being the date when Mr Boer signed the
notarial deeds of sale giving effect thereto
before the notary.
[17]
Trial
particulars under rule 21(2) may be requested as are necessary to
prepare for trial and are not pleadings: they do not set
up a cause
of action or a
defence
by which a party is bound, nor can they change an existing cause of
action, create a new one or limit the scope of the case being
made by
the party that supplies them.
[4]
Their purpose in general is not to elicit evidence or information
that will emerge in cross examination
[5]
but ‘…
to
limit waste of time and costs by providing the other party with
additional insight into the case which has been pleaded, thus
avoiding, where possible, delays or postponement to seek evidence to
meet a case
’.
[6]
It follows therefore that the plaintiffs’ case regarding where
ownership of the property lay is that set out in the pleadings
and
this pleaded case is not amended by the trial particulars provided.
The fact that trial particulars provided may be shown later
to have
caused prejudice by virtue of incorrect information being put up
which contradicts the particulars of claim, is a matter
for
consideration by the trial court whether in respect of costs or the
grant of a postponement as a result thereof. For current
purposes the
trial particulars provided do not amend the existing cause of action
or pleaded case as detailed by the plaintiffs.
[18] In the
plaintiffs’ founding affidavit to the current application,
their attorney, Mr Patrick Holloway, stated that the
plaintiffs have
advanced their case on the basis that no distinction has been made
between Handel and Vastgoed in the quantification
of the claim, with
both being subsidiary companies controlled by Mr L J Boer, who is the
sole trustee of Stichting Administrasie
Kantoor LJ Boer Sliedrecht
Beheer, which owns all shares in LJ Boer Sliedrecht Beheer BV which
in turn owns all shares in Handel
and Vastgoed, of which Mr Boer is
the sole director. Mr Holloway states further that –
‘…
it
had always been Mr Boer’s intention that Handel would in due
course have transferred ownership of both the two halves of
the
floating dock and the pontoon to Vastgoed
…
after they
had arrived in Rotterdam and the composite dock had been completed.
Mr Boer had intended that Vastgoed would thereafter
rent the floating
dock to the entity which would operate it…As regard the
pontoon, Mr Boer had also always intended that
the pontoon would in
due course be transferred to Vastgoed by Handel. In fact, a notarial
deed of transfer of ownership from Handel
to Vastgoed was executed on
23 March 2009. However, this transfer was reversed on 15 April 2009,
so, I understand, that ownership
of the pontoon was transferred back
to Handel….To sum up, the position therefore is that as far as
the plaintiffs are concerned,
Handel was the owner of the two halves
of the floating dock and the pontoon at the time of the casualty
while, arising out of Mr
Boer’s aforesaid intention, Vastgoed
would have suffered the loss of profits in consequence of their loss
in the casualty.’
[19] Mr
MacWilliam
SC argued for the plaintiffs that the contents of paragraphs 2.1 and
2.2 of the proposed POC1 introduce nothing new and refer to
neither
Handel nor Vastgoed, only seeking to amend the quantification of the
plaintiffs’ loss of profit claims and not the
formulation of
the claims in the particulars of claim. Yet, it was argued that the
defendants are not entitled to rely as ‘immutable’
fact
on Handel being the owner of the pontoon while Vastgoed was the
plaintiffs not that the intended owner who would have lost
profits
and the proposed POC1 does not deal with this issue. The particulars
of claim in the two actions have never identified
Handel or Vastgoed
as the plaintiff claiming loss of profits and the plaintiffs note
that the defendants have not excepted to the
particulars, despite the
alleged ground of exception having existed since the inception of the
claims, and any exception now out
of time in that two years have
elapsed since the particulars of claim were amended. The plaintiffs
contend that the identity of
the specific plaintiff which owns the
pontoon and floating dock is only capable of determination by the
trial court and that a
quantification of the loss of profits claim
should therefore not be precluded. Importantly, Mr MacWilliam stated
that the plaintiffs
do not exclude that the claim pursued is one for
pure economic loss, which they argue is competent both under either
South African
Roman-Dutch and English law.
[20] I accept that
the amended particulars of claim read with the existing POC1 by
referring to the auditors’ report and the
charter agreement
limited the claim to one by Handel. This is not however the case in
respect of the proposed POC1. The proposed
POC1 therefore alters the
quantification of the claim proposing a claim by either Handel or
Vastgoed without limiting such a claim
to one based solely on
ownership of the property in question.
[21]
Admiralty
rule 2(1)(a) requires that a summons ‘
contain
a clear concise statement of the nature of the claim and of the
relief or remedy required and of the amount claimed, if
any
’,
with Admiralty rule 9(3)(a) requiring every pleading to contain a
clear and concise statement of the material facts upon
which the
party relies for his or her claim with sufficient particularity to
enable a reply. These rules echo similar provisions
in the Uniform
Rules of Court. While the facts to which a party pleads do not need
to be established in order for an amendment
to be granted, the issue
proposed to be introduced by the amendment must be a triable issue
[7]
which if proved on the basis of evidence foreshadowed by the
applicant in his or her application, will be viable or relevant, or
which will as a matter of probability be established by the evidence
thus foreshadowed.
[8]
[22]
Uniform
rule 23 permits a party to deliver an exception ‘(w)
here
any pleading is vague and embarrassing or lacks averments which are
necessary to sustain an action or defence, as the case
may be
…’.
An exception raised strikes at the formulation of the whole cause of
action, which must be demonstrated to be vague
and embarrassing:
[9]
‘
The
plaintiff is required to furnish an outline of his case. That does
not mean that the defendant is entitled to a framework like
a
crossword puzzle in which every gap can be filled by logical
deduction. The outline may be asymmetrical and possess rough edges
not obvious until actually explored by evidence. Provided the
defendant is given a clear idea of the material facts which are
necessary to make the cause of action intelligible, the plaintiff
will have satisfied the requirements
.’
[23]
In
Quinlan
v MacGregor
[10]
it
was stated that an exception to a pleading on the ground that it is
vague and embarrassing involves a determination as to whether
the
pleading lacks particularity to the extent that it is vague and
thereafter whether the vagueness causes embarrassment of such
a
nature that the excipient is prejudiced. By the nature of exception
proceedings the correctness of the facts averred in the particulars
of claim must be assumed.
[11]
[24] Both the action
in rem
and the action
in personam
, now consolidated,
are matters in respect of which a Court of Admiralty of the Republic
referred to in the Colonial Courts of Admiralty
Act, 1890, had
jurisdiction immediately before the commencement of the Act on 1
November 1983. The defendants contend that the
plaintiffs’
claims are governed by English law as at 1 November 1983, which is
South African law, in accordance with s 6(1)
of the Admiralty
Jurisdiction Regulation Act 105 of 1983 (“AJRA”), as
amended. S 6 provides that:
‘
(1)
Notwithstanding anything to the contrary in any law or the common
law contained a court in the exercise of its admiralty jurisdiction
shall –
(a)
with regard to any matter in respect of which a court of admiralty of
the Republic referred to in the Colonial Courts Admiralty
Act, 1890,
of the United Kingdom, had jurisdiction immediately before the
commencement of this Act, apply the law which the High
Court of
Justice of the United Kingdom in the exercise of its admiralty
jurisdiction would have applied with regard to such matter
at such
commencement, insofar as the law can be applied;
(b)
with regard to any other matter, apply the Roman Dutch law applicable
in the Republic
.
(2)
The provisions of ss (1) shall not derogate from the provisions of
any law of the Republic applicable to any of the matters
contemplated
in para (a) or (b) of that subsection
.’
[25]
Corbett
JA in
Transol
Bunker BV v MV Andrico Unity and others
[12]
stated that in terms of s 6(1)(a) disputes such as that before this
Court must:
‘…
be
resolved by reference to the applied by the English High Court
exercising admiralty jurisdiction as at 1 November 1983 and that
this
reference comprehended both domestic rules of law and the relevant
principles of private international law’
.
[13]
[26]
The
plaintiffs contend that under English private international law it is
South African Roman-Dutch law that has the closest connection
to the
delict and as the
lex
loci deliciti
it applies to the claims. The defendants dispute this on the basis
that South African law is English law as at 1 November 1983,
alternatively if English private international law finds application
then the Court will nevertheless apply English law as at 1
November
1983 on the application of the double actionability doctrine detailed
in
Phillips
v Eyre
[14]
:
‘
As
a general rule, in order to found a suit in England for a wrong
alleged to have been committed abroad, two conditions must be
fulfilled. First, the wrong must be of such a character that it would
have been actionable if committed in England…Secondly,
the act
must not have been justifiable by the law of the place where it is
done
’.
[27]
Chaplin
v Boys
[15]
found double
actionability
to be a general rule to which an exception may apply. In that case,
English law, being the
lex
fori,
applied given that the litigants were British servicemen even when
damages were not recoverable under Maltese law. Although the
ratio
decidendi
in
Chaplin
v Boys
has long been the subject of debate, there has been judicial approval
for an exception to the principle formulated as arising on
the basis
of the law that had the most significant relationship with the
occurrence and the parties.
[16]
The Privy Council in
Red
Sea Insurance Co Ltd v Bouygues SA and others
[17]
found the double actionability rule as not inflexible, with it
possible to depart from the rule on unclear and satisfying grounds
in
order to avoid injustice such as the law of the country to which
there existed the most significant relationship with the occurrence
and with the parties. This was so even where the claim would not be
actionable under the
lex
fori
.
[28] In addition to
arguing that the decision in
Red Sea
is not binding given that
it is a decision of the Privy Council, the defendants contend that
there are no significant factors connecting
any particular country to
the delict. Without determining the weight to be attached to the
decision in
Red Sea,
it appears to me that it must have strong
persuasive value. Nor am I persuaded that no particular country is
connected to the delict
given that the stranding occurred in the
territorial waters of South Africa which provides a significant
connecting factor in circumstances
in which the United Kingdom has no
such direct connection. It seems to me therefore that the country
with the most significant
relationship with the occurrence appears
therefore to be South Africa
.
[29]
The
parties are not
ad
idem
as to whether a claim for pure economic loss is permissible under
English law and to this extent the issue of choice of law becomes
relevant. Assuming for current purposes that Mr
MacWilliam
is correct and South African law applies to the delict, a claim for
pure economic loss, as per
Administrateur,
Natal v Trust Bank Bpk,
[18]
would be recognised by our law with the only limiting factor being
whether the defendant’s conduct was wrongful vis-à-vis
the plaintiff, which is a matter of public policy.
[19]
However, as was stated in
Country
Cloud Trading CC v MEC, Department of Infrastructure Development,
Gauteng
[20]
by Khampepe J:
‘
There
is no general right not to be caused pure economic loss…our
law is generally reluctant to recognise pure economic loss
claims,
especially where it would constitute an extension of the law of
delict.
Wrongfulness
must be positively established. It has thus far been established in
limited categories of cases, like intentional interferences
in
contractual relations or negligent misstatements, where the plaintiff
can show a right or legally recognised interest that the
defendant
infringed…In addition, if claims for pure economic loss are
too freely recognised, there is the risk of “liability
in
an indeterminate amount for an indeterminate time to an indeterminate
class”. Pure economic losses, unlike losses resulting
from
physical harm to person or property—
“
are
not subject to the law of physics and can spread widely and
unpredictably, for example, where people react to incorrect
information
in a news report, or where the malfunction of an
electricity network causes shut-downs, expenses and loss of profits
to businesses
that depend on electricity.”
…
So
the element of wrongfulness provides the necessary check on liability
in these circumstances. It functions in this context
to curb
liability and, in doing so, to ensure that unmanageably wide or
indeterminate liability does not eventuate and that liability
is not
inappropriately allocated’.
[30]
It is
trite that the plaintiff is required to plead all the facts on which
it relies. If the pleadings lack sufficient clarity to
make out a
case, the pleadings may be vague and embarrassing.
[21]
Equally trite is that five elements must be present under our law
before conduct complained of may be classified as the delict:
an act,
wrongfulness, fault, causation and harm.
[22]
Save for certain exceptions, with one or more of these elements
absent there
is
no delict and no liability.
[23]
In
Fourways
Haulage SA (Pty) Ltd v SA National Roads Agency Ltd
[24]
Brand JA stated that-
‘
The
proposition that a plaintiff claiming pure economic loss must allege
wrongfulness, and plead the facts relied upon to support
that
essential allegation, is a principle well founded. In fact, the
absence of such allegations may render the particulars of
claim
excipiable on the basis that no cause of action has been disclosed.
[31]
In
Minister
of Safety and Security v Scott
[25]
it was stated that our courts have correctly held that the
wrongfulness of an act causing pure economic loss almost always lies
in the breach of a legal duty. This requires in each case a
determination as to whether, according to the circumstances, there
was a legal duty to avoid pure economic loss with the yardstick being
the general criteria of reasonableness or
boni
mores
.
[26]
The
boni
mores
criterion implies a careful weighing up of the interests of the
parties involved, taking into account the public interest.
[27]
This involves courts attaching importance to factors such as
knowledge (whether the defendants knew or subjectively foresaw that
their negligent conduct would cause damage to the plaintiffs);
[28]
whether the defendants should have foreseen that their negligent
conduct would have harmed the plaintiffs; whether practical steps
could have been taken by the defendant to prevent the economic loss;
the extent of the defendants' professional knowledge and competence;
the extent of the risk of economic loss and the extent of the loss;
the existence of any statutory provision; and other miscellaneous
considerations.
[29]
[32] The plaintiffs’
particulars of claim do not contain sufficient allegations to support
a claim for economic loss by Vastgoed.
The reference to a ‘breach
of duty’ of the amended particulars of claim is insufficient
and the grounds on which negligence
is alleged cannot be extrapolated
to glean the basis on which wrongfulness is alleged. Without a clear
and concise statement of
the material facts on which a pure economic
loss claim is founded and from which wrongfulness is alleged to
arise, permitting the
amendment sought would quantify a claim in
respect of which there has not been a clear and concise statement of
the material facts
relied upon with sufficient particularity to found
such claim pleaded and which, if granted, may well render the
pleadings excipiable.
In the circumstances, I am not persuaded that
the application to amend the particulars of claim to the extent
sought by the plaintiffs
through the introduction of paragraphs 2.1
and 2.2 of the proposed POC1 stands to be granted. Such application
is accordingly refused
and the plaintiffs are to pay the defendants’
costs jointly and severally, such costs to include those occasioned
by the
employer two counsel.
Admiralty rule 20
application
[33] The second
application before this Court is one brought by the defendants under
Admiralty rule 20 for an order striking out
the plaintiffs'
application to amend the particulars of claim as an irregular
proceeding. Rule 20 permits the Court to strike out
any proceedings
which are vexatious, an abuse of the process of the court or make
such an order as appears to be just where they
have been in regular
proceedings or non-compliance with the rules or any order of court.
[34] The defendants
complaint is that Uniform rule 28(4) the plaintiffs were required to
commence an application for leave to amend
their particulars of claim
within 10 days of the date upon which the notice of objection was
received, being by no later than 2
July 2014. There is no dispute
that such application was launched six weeks later on 12 August 2014,
with no application for condonation,
seeking an amendment that
differed from the one foreshadowed in the notice of amendment. By
doing so, the defendants contend that
the plaintiffs’ conduct
is vexatious and unfounded.
[35]
In
Federated
Trust Ltd v Botha
[30]
it was stated that -
‘
The
Court does not encourage formalism in the application of the Rules.
The rules are not an end in themselves to be observed for
their own
sake. They are provided to secure the inexpensive and expeditious
completion of litigation before the courts…Where
one or other
of the parties has failed to comply with requirements of the Rules or
order made in terms thereof and prejudice has
thereby been caused to
his opponent, it should be the court’s endeavour to remedy such
prejudice in a manner appropriate
to the circumstances, always
bearing in mind the object for which the Rules were designed
.’
[36]
Vexatious
proceedings are those which are unfounded or impossible, pursued
where there is ‘
plainly
no prospect of success
’,
or which ‘
can
really lead to no possible good
’.
[31]
The plaintiffs’ application to amend its particulars of claim
constitutes no such proceedings.
[37]
Abuse
of process refers to frivolous litigation with an ulterior or
improper purpose to ‘
exert
pressure so as to achieve and improper end
’.
[32]
Similarly, the plaintiffs’ application to amend cannot be said
to constitute an abuse of process. The defendants have shown
no
prejudice to have been caused to them as a consequence of the late
filing of the amendment application given the postponement
of the
trial which had been agreed prior to the hearing of the matters at
hand.
[38] This Court is
clearly permitted under rule 28(10) to grant leave to amend any
pleading or document regardless of when such
application is made,
with due regard to issues of prejudice. It is unclear why given the
agreed postponement of the trial, the
defendants persisted with the
current application, as opposed to focusing on the opposition to the
amendment application. I am
satisfied that the plaintiffs were within
their rights to seek an amendment on the basis they did and that
their delay in doing
so was neither vexatious nor did it constitute
an abuse of process. In these circumstances, it must follow that the
defendants’
application under Admiralty rule 20 is refused.
There is no reason as to why the defendants should not pay the
plaintiffs’
costs in opposing this application jointly and
severally, including the costs of two counsel.
Application to
compel response to the defendants’ request for trial
particulars
[39] In the final
application before this Court, the defendants seek an order
compelling the plaintiffs to provide a ‘
full and proper
response
’ to the defendant's request for trial particulars
delivered on 25 March 2014. By the date of hearing of this
application
the particulars sought which had not been provided had
been narrowed to paragraphs 15.1, 52, 70 and 153 of the request. The
defendants
contend that whatever the outcome of the application they
have been substantially successful insofar as following the launch of
the current application is concerned, with
inter alia
paragraph 2.1 of the notice of motion having been resolved and the
particulars sought in paragraphs 1, 3, 4.1, 7, 9, 40 and 83
having
been furnished by the plaintiffs. The plaintiffs dispute that the
defendants are entitled to the costs of this application
given that
it was in an attempt to avoid litigation that such particulars were
provided, and not as a result of an entitlement
on the part of the
defendants to obtain such particulars.
[40] Admiralty rule
13 provides that:
‘
(1)
At any time after the close of pleadings a party may deliver a
request for further particulars with regard to the pleading of any
other party to the action for the purpose of enabling the party
delivering the request to prepare for trial.
(2)
(a) Particulars may be requested of a denial or with regard to any
matter deemed to have been put in issue.
(b)
It shall not be an objection to any such request that the purpose of
the request is to obtain an admission of a matter placed
in issue.
(3)
Any answer to a request for further particulars shall bind the party
giving the answer in relation to all particulars to the
action and
not only in relation to the party requesting the particulars
.’
[41]
The
ambit of Admiralty 13 is wider than the provisions of Uniform rule
21(2), which restricts particulars to those ‘
strictly
necessary to enable him to prepare for trial
’.
The defendants contend that the Court may go beyond the pleadings and
look at other matters to determine whether a litigant
requires the
particulars in order to prepare for trial with the purpose of
particulars is to prevent surprise and to narrow the
issues in
dispute, without tying the other party down or limiting his or her
case. As was stated in
Ruslyn
Plant Hire Ltd v Alexcor Ltd
[33]
–
‘
The
purpose of particulars for trial is to limit waste of time and costs
by providing the other party with additional insight into
the case
which has been pleaded, thus avoiding, where possible, delays or
postponement to seek evidence to meet a case’
.
Para 15.1
[42] In paragraph 15
of the request the plaintiffs are asked whether they admit that the
bill of lading listed as item is 14 and
15 of the plaintiffs’
discovery affidavit dated 29 October 2012 is the bill of lading
issued in respect of the Tow. The plaintiffs
responded ‘no’.
In paragraph 15.1 of the request, the plaintiffs were asked seven
questions with regards to the bill
of lading. It is the sixth
question which is the subject of this application, namely whether the
plaintiffs or their agents, including
Rabobank, participated or
assisted in the drawing up of the bill of lading, and in the
formulation of the description of the cargo
and the clauses on the
face of the bill of lading. If so, full details were sought as to
precisely which provisions were proposed
or formulated. In response
the plaintiff's stated that the particulars requested are not
required for any purpose envisaged in
the rules of court and are
refused.
[43] The defendants
argue that they require details relating to the bill of lading which
is a negotiable document evidencing a contract
of carriage between
one or both of the defendants, as carrier, and the shipper, Ningbo
Grand Ocean International (‘Ningbo’).
If the bill of
lading was delivered to the plaintiffs or their agents, the
plaintiffs may have become parties to the contract of
carriage
evidenced by the bill of lading.
[44] It is not
disputed that the bill of lading is recorded to be ‘
without
prejudice to the signed Towcon agreement
’. The parties
agree that the Towcon constitutes the contract and is unaffected by
the signature of the bill of lading. However,
the defendants submit
that the effect of the clause is that the Towcon will be regarded as
incorporated into the bill of lading
contract, save insofar as the
terms of the bill of lading are inconsistent with the Towcon and that
they require the information
requested for purposes of preparing for
trial. I am not satisfied that this is so, or that such information
is reasonably required
by the defendants for purposes of preparing
for trial. Such matters are properly dealt with in evidence and the
plaintiffs are
not obliged to provide the particularity sought in
this regard by the defendants.
Para 52
[45] The plaintiffs
were asked in paragraph 51 of the request whether it was the duty of
the master and/or crew of the Tug, and/or
of the Owner or Posh Semco,
to ensure that the towing arrangement, emergency towing arrangement,
tackle and/or equipment on board
the Pontoon was what would
reasonably be expected to ensure the Tow was towed safely, that the
tow line would not part, and that
if it did part, that the Tow could
nonetheless be retrieved before stranding. To this the plaintiffs
replied ‘yes’.
In paragraph 52 of the request the
plaintiffs were asked if this was so, and having regard to inter alia
Box 39 of Part 1 of the
Towcon (item A12 of the first part first
schedule of the defendant's discovery affidavit stated to January
2013) and clauses 2.2,
23 and 2.6 of the Transportation Manual (item
A10 in the first schedule to the defendants’ discovery
affidavit deposed to
on 2 January 2013) to specify the factual and
legal basis for that contention.
[46] The plaintiffs
responded that not only are the terms of the Towcon irrelevant to the
plaintiffs' cause of action but the plaintiffs
were not responsible
for the tow from Shanghai to Rotterdam, were not party to the Towcon
and played no role in its negotiation.
Furthermore, the
Transportation Manual was not prepared by plaintiffs and the
plaintiffs had no knowledge of it prior to the parting
of the tow
wire.
[47] The defendants
claim that they are entitled to know the legal basis and other basis
for the plaintiff's contention that the
defendants, as well as the
master and crew of the Tug, had an obligation to ensure that the
towing arrangement and the emergency
towing arrangement were
adequate. This is particularly so as the plaintiffs’
contentions are contradicted by the provisions
of the Towcon and the
Transportation Manual. Once again, I am not satisfied that this
information is reasonably required by the
defendants for purposes of
preparing for trial. Such matters are properly dealt with in evidence
and the plaintiffs are not obliged
to provide the particularity
sought in this regard by the defendants.
Para 70
[48] The plaintiffs
were asked in paragraph 70 what distance they regard as constituting
sufficient sea room between the Tug and
Tow and the West Coast with
distances stated from 20 – 100 nautical miles, or more. In
response the plaintiffs indicated
that after passing Cape Agulhas the
Tug and Tow should have put as much to sea room as possible between
them and the West Coast
but that it was not possible to state
precisely what that distance would have been as this would have
depended on a number of factors
including the Tug’s
capabilities and limitations, the behaviour of the Tow, the convoy’s
speed and the sea and weather
conditions actually experienced.
[49] The defendants
contend that having made a positive averment in this regard, they
cannot refuse to provide an indication of
what they regard as
‘sufficient sea room’ to be. I am not satisfied that this
is so, or that such information is reasonably
required by the
defendants to prepare for trial. Such matters are properly dealt with
in evidence and the plaintiffs are not obliged
to provide the
particularity sought in this regard by the defendants.
Para 153
[50] The plaintiffs
were asked to provide full particulars of and in terms of rule 35(3)
to produce and discover all documents relating
to the pledge of the
plaintiffs' current and future claims against Posh Semco as described
in the relevant finance proposal, including
details of any
registration thereof in the Netherlands. In response the plaintiffs
stated that they are not in possession of any
further documents
relating to the pledge.
[51] With the deed
of pledge having been discovered by the plaintiffs, the plaintiffs
contend that the defendants seek documents
and further particularity
regarding the reference to a finance proposal referred to in the
pledge in an attempt to investigate
whether the plaintiffs have title
to sue. What this request amounts to is a fishing expedition embarked
upon by the defendants
with the hope that the
plaintiffs
locus standi
may be impeached. I am not satisfied that such
information is reasonably required for purposes of preparing for
trial and the plaintiffs
are not obliged to provide the particularity
sought in this regard by the defendants.
[52] The
determination of the costs of this application should properly be
dealt with by the trial court in its consideration of
the evidentiary
material before it, including the relevance of such material. The
costs of this application accordingly stand over
for later
determination.
Order
[53] In the result,
an order is made in the following terms:
1. The plaintiffs'
application to amend the particulars of claim in the consolidated
actions instituted under case numbers AC81/2009
and AC144/2010 is
refused. The plaintiffs are jointly and severally to pay the
defendants’ costs in opposing such application
on the scale
between party and party, including the costs of two counsel.
2. The defendants’
application under Admiralty rule 20 is refused. The defendants are
jointly and severally to pay the plaintiffs’
costs in opposing
such application on the scale between party and party, including the
costs of two counsel.
3. The defendants’
application to compel a response by the plaintiffs to the request for
further particulars to prepare for
trial is refused with costs to
stand over for later determination.
KM SAVAGE
Acting
Judge of the High Court
Appearances:
For
plaintiffs: RWF MacWilliam SC and D Melunsky
Instructed
by Webber Wentzel
For
defendants: M Wragge SC and JD McKenzie
Instructed
by Norton Rose Fulbright SA
[1]
Whittaker
v Roos and Another
1911 TPD 1092
at 1102
[2]
Trans-Drakensberg
Bank Ltd (under judicial management) v Combined Engineering (Pty)
Ltd and Another
1967 (3) SA 632
(D&CLD) at 638A-B;
Devonia
Shipping Lt v MV Luis (Yeoman Shipping Co Ltd Intervening)
1994 (2) SA 363
(C) at 369F;
Affordable
Medicines Trust v Minister of Health and Others
[2005] ZACC 3
;
2006 (3) SA 247
(CC) at para 9; 463E, 462J-463B and 464E-H
[3]
Bafokeng
Tribe v Impala Platinum Ltd and others
1999
(3) SA 517
(BH) at 539H-J;
Barnard
v Barnard
2000 (3) SA 741
(C ) at 754F;
Nxumalo
v First Link Insurance Brokers (Pty) Ltd
2003 (2) SA 620
(T);
Kirschke
v Road Accident Fund
2004 (4) SA 358
(W) at 363B
[4]
Ruslyn
Mining and Plant Hire (Pty) Ltd v Alexkor Ltd
[2012] 1 All SA 317
(SCA) at para 18
[5]
Von
Gordon v Von Gordon
1961 (4) SA 211
(T) at 213
[6]
Ruslyn
at para 8
[7]
Trans-Drakensberg
Bank Ltd (under judicial management) v Combined Engineering (Pty)
Ltd and Another
1967 (3) SA 632
(D&CLD) at 638A-B;
Barnard
at 754F;
Caxton
Ltd v Reeva Forman (Pty) Ltd
[1990] ZASCA 47
;
1990 (3) SA 547
(A) at 565H-J
[8]
Ciba-Geigy
(Pty) Ltd v Lushof Farms (Pty) Ltd en ’n Ander
[2002] 1 All SA 517
at para 34;
Consol
Ltd t/a Consol Glass v Twee Jonge Gezellen (Pty) Ltd (2)
2005 (6) SA 23
(C).
[9]
Jowell
v Branwell-Jones and others
1998
(1) SA 836
(W) at 899G, 913F-G
[10]
1960 (4) SA 383
(D) at 393 E-H
[11]
Trustees,
Two Oceans Aquarium Trust v Kantey & Templer (Pty) Ltd
2006 (3) SA 138
(SCA) paras 3-10;
Stewart
& another v Botha & another
[2008] ZASCA 84
;
2008 (6) SA 310
(SCA) para 4
[12]
1989 (4) SA 325
(A) at 336B
[13]
See too
Red
Sea Insurance Company Limited v Bouygues SA and 22 Others
[1995] 1 AC 190
, Privy Council Appeal No. 32 of 1993 also referred
to as
The
Agulhas
1999 SCOSA A1 (D); Hofmeyr Admiralty Jurisdiction: Law and practice
in South Africa 2
nd
edition, chapter 111 para 11.17, p93, with reference to
Transol
Bunker BV v The Andrico Unity
1987 (3) SA 794
(C ) at 822G-823D and on appeal in
1989 (4) SA 325
(A) at 335E-336B;
Macard
Stein & Co v Port Marine Contractors (Pty) Ltd
[1995] ZASCA 76
;
1995 (3) SA 663
(A) at 667C and
The
Argun
2001 (3) SA 1230
(SCA) at 1239 I-J
[14]
1870 LR 6 QB 1
at 28 -29
[15]
[1969] 2 All ER 1085.
[16]
Dicey, Morris and Collins on The Conflict of Laws (15
th
ed) 2006 at1895 and 1896 footnote 37. This formulation has received
subsequent judicial approval.
[17]
[1994] 3 All ER 749
[18]
1979 (3) SA 824
(A)
[19]
Country
Cloud Trading CC v MEC, Department of Infrastructure
2014 (2) SA 214
(SCA) at para 18
[20]
(CCT 185/13)
[2014] ZACC 28
(3 October 2014); see too
2014 (2) SA
214
(SCA) at para 18 per Brand JA
[21]
Lillicrap,
Wassenaar and Partners v Pilkington Brothers (SA) (Pty) Ltd
1985 (1) SA 575
(A) at 498H-499A
[22]
Telematrix
at 468
[23]
Neethling at page 4
[24]
[2008] ZASCA 134
;
2009 (2) SA 150
(SCA) at para 14 with authorities quoted there.
[25]
2014 (6) SA 1
(SCA) at para 32
[26]
Neethling
et
al
Law of Delict (2010) at 291 and authorities quoted there.
[27]
Coronation
Brick (Pty) Ltd v Strachan Construction Co (Pty) Ltd
1982
(4) SA 371
(D) at 384
[28]
At 386
[29]
Neethling
et
al (op cit)
at 293-7
[30]
1978 (3) SA 645
(A) at 654C-F
[31]
Fitchet
v Fitchet
1987 (1) SA 450(E)
at 454;
Farjas
Pty Ltd and another v Regional Land Claims Commissioner,
KwaZulu-Natal
1988 (2) SA 900
(LAC) at 927;
Polverini
v General Accident Insurance Co South Africa Ltd
1988 (3)SA 546 (W) at 554.
[32]
PricewaterhouseCoopers
Inc and others v National Potato Co-operative Ltd
2004 (6) SA 66
(SCA) at para 50.
[33]
At para 8