About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Western Cape High Court, Cape Town
SAFLII
>>
Databases
>>
South Africa: Western Cape High Court, Cape Town
>>
2015
>>
[2015] ZAWCHC 27
|
|
Cape Agulhas Hotel CC v Liesbeek Motors (Pty) Ltd (1479/09) [2015] ZAWCHC 27 (6 March 2015)
IN THE HIGH COURT OF
SOUTH AFRICA
(WESTERN CAPE HIGH
COURT, CAPE TOWN)
Case number: 1479/09
DATE: 06 MARCH 2015
In the review between:
CAPE AGULHAS HOTEL
CC
...........................................................................................
PLAINTIFF
And
LIESBEEK MOTORS (PTY)
LTD
.................................................................................
DEFENDANT
JUDGMENT
BLOMMAERT A J
INTRODUCTION
1. On the banks of the Breede River on
the Malgas side, somewhere between Malgas and Infanta is a large
house known in the area
as the White House.
2. The White House was built in or
about 1989 by the late Mr Myburgh Streicher, a well known political
figure. It is a large house
consisting of some 26 rooms, 6 of which
are bedrooms and 6 bathrooms.
3. The immovable property on which the
house is situated (“the property”) is described as
portion 51 (a portion of portion
3) of the farm Potberg Estates, No
516, in the division of Swellendam, Cape.
4. On 24 January 2006 the property was
sold to the Plaintiff, represented by its sole member, Dr Richard
Young. The seller was
the Defendant represented by Ms Gwen
Streicher, who is, and was at the time of the sale, the widow of Mr
Myburgh Streicher who
had passed away in April 2005. For the sake of
convenience, I will refer to the Plaintiff as (“Young”)
and the Defendant
as (“Streicher”).
5. The estate agent who facilitated the
sale was Ms Riana Gibson (“Gibson”). At the time she was
an employee of a Seeff
franchise, Catwalk (Pty) Ltd t/a Seeff
Southern Cape which has its principal place of business in
Swellendam. For the sake of
convenience, I will refer to the
company as (“Seeff”) and in this Judgment the owner of
Seeff, Mr Ian Badenhorst as
(“Badenhorst”). Transfer of
the property was effected on 28 February 2006.
6. Prior to the conclusion of the Deed
of Sale, Young alleges that Streicher, duly represented by Gibson and
Badenhorst, orally
represented to him that there was a Water Supply
Agreement with the owner of the neighbouring property in terms of
which the property
had access to and pumped water using its own
equipment from a borehole on the neighbouring property. The
neighbour is a Mr Malcolm
Wallace (“Wallace”). These
representations Young alleges were made on, or in the vicinity of the
property, on 16 and
20 January 2006.
7. Young alleges that these
representations were false in that the Water Supply Agreement had
expired on 1 May 2005 and that Streicher
knew them to be false.
8. Young further alleges that the
Defendant knew that water would be required by him for various
purposes and therefore that Streicher
was under a duty not to
misrepresent the position regarding the Water Supply Agreement. Had
the misrepresentation not occurred,
Young alleges he would not have
purchased the property, or would have purchased the property at a
lower price. Furthermore he alleges
that the misrepresentations were
intended by Streicher to induce him to purchase the property, or to
purchase the property at a
higher price than he would otherwise have
done. Accordingly Young claims damages from Streicher pertaining to
the costs in providing
water to the property.
9. At this stage it is important to
note that I am tasked only with the issues regarding the so-called
“merits” as opposed
to the quantum of the Plaintiff’s
claim.
10. Summons was issued on 27 January
2009. On 22 October 2009 the Defendant pleaded thereto. In its Plea
the Defendant alleges
inter alia that, prior to the conclusion of the
Deed of Sale, Young had been informed by Gibson of the following:
10.1. That water in the Malgas area was
a problem for all properties situated in the area;
10.2. That there was a Water Supply
Agreement with Wallace, but that Gibson was not aware of all the
detail pertaining thereto and
that Young should speak to Streicher to
obtain more details;
10.3. That another person in the area
was searching for water and, should that person find water, and
should the property not be
sold, Streicher and that person intended
laying a pipe to bring water to their properties, with Streicher
sharing the costs of
doing so.
11. The matter was duly enrolled for
hearing on 9 September 2013. On the afternoon of 3 September 2013,
Defendant served on Plaintiff
a Notice of Intention to Amend its
Plea. Plaintiff opposed the amendment and the Defendant accordingly
brought an application
for leave to amend. The said application for
leave to amend was supported by affidavits deposed to by Streicher
and Gibson. The
Defendant now specifically denied that, prior to the
conclusion of the Deed of Sale, Badenhorst and Gibson had acted as
authorised
agents or represented Streicher. In fact, Streicher
pleaded, Badenhorst and Gibson had been instructed or employed or
mandated
by Young.
12. Young did not persist with the
opposition to this amendment and the amendment was duly made. In
light of the amendment the
trial was postponed.
13. Thereafter Young took steps to join
Seeff, Badenhorst and Gibson as Second, Third and Fourth Defendants
respectively. The order
joining them as such was granted on 20 June
2014.
14. Pursuant to that order, Young
amended the Particulars of Claim by inserting, in the alternative and
in the event that the Court
should find that the estate agents had
indeed been mandated by Young, rather than Streicher, a claim against
the estate agents
for damages arising from breach of contract.
15. In his evidence Young denied having
been the mandator of Seeff in regard to the property. During his
cross-examination, counsel
for the Defendant put no contrary version
to him. Counsel for the estate agents put to Young that Gibson would
say “he phoned
Mrs Streicher, asked whether she can show the
property, she consented and she took you there” to which Young
replied “so
she got a mandate to sell – yes”. To
this counsel for the estate agent said, “she got the consent to
show it
to you - correct”.
16. Based on the aforesaid the
Plaintiff decided not to proceed with its case against the estate
agents. An agreement in regard
to costs was reached with the agents
and the trial thereafter proceeded only against the Defendant.
17. I will return to the issue of who
the mandator was at a later stage.
THE EVIDENCE
18. Young is a well-known personality,
primarily in the context of what is known as the arms deal saga. As
such he has, according
to him, been the subject matter of
surveillance and resultantly, his privacy was of particular
importance to him.
19. He had previously lived in
Struisbaai and had relocated to Knysna. The Knysna environment did
not suit him as he wanted more
privacy and he wanted a property in
which he could protect himself. He said that he needed to create an
environment which would
allow him to observe who was observing him,
and for this reason he proceeded to look for an alternative home.
With this in mind
he contacted one Attenborough, who was the Seeff
agent for the Witsand area.
20. Attenborough sold properties on the
eastern side of the Breede River i.e. on the Witsand side. Young was
however more interested
in acquiring a property on the Infanta side
of the river.
21. Having spoken to Attenborough
telephonically, Young drove to Witsand with his girlfriend on 16
January 2006 to meet with her.
She offered to show him properties on
the Witsand side, but he was not interested and she thereafter
proposed to hand him over
to the accredited Seeff agent on the
Infanta side, one Gibson.
22. Young and his girlfriend then drove
to Malgas and met Gibson on the Swellendam-Infanta Road. Gibson
showed them four properties.
The third of the four was the property
which is the subject matter of this dispute.
23. Upon viewing the property on 16 of
January 2006, Young was immediately enamoured with it.
24. He testified that upon their
arrival at the property, the garden was green and vibrant. The
swimming pool was full and was,
in fact, being filled further by
means of a hosepipe. He also saw fruit trees and testified that
there was nothing to indicate
that there was a shortage of water on
the property.
25. Young testified that on 16 January
2006 he could not view the inside of the home as the person who was
“renting”
the bottom part of the house, and had a key to
the house, was not there.
26. Young specifically testifies as
follows regarding the questions he asked:
“Well, I mean I was asking a lot
of questions. Off course, when one is buying a property, especially
a farm one must know
a lot about things like sewerage, electricity
and water.”
27. As to specific questions asked by
Young, he enquired about the electricity and was told that there was
at that moment only a
generator, but that Eskom was installing power.
When he was asked whether he was planning to live there, he replied
“absolutely”.
28. As to the water ,Young testified as
follows:
“Anyway at this stage I was
talking to Mrs Gibson and she explained the water situation to me -
to be frank in pleasing detail,
enough to actually realise what was
going on. “
29. She told him that in that area
there were water challenges. Furthermore she said “But the most
important part of that
is that they had solved those challenges and
that was that they had come to there was a water supply arrangement
with the neighbouring
farm”. Young further testified that this
made sense to him as portion 51 was one of 10 portions, each of 25
hectares along
the river that had been subdivided and sold for
development. The rest of the 750 hectare farm, portion 3, was where
the water
came from. He testified “So it made absolute sense
to me was if, well if there is a place that we are cutting of and
selling
it as a 25 hectare farm and that there was no water there,
but there was abundant water on portion 3 that it would make sense
that
that arrangement had been made when the subdivisions were made
to supply”.
30. More importantly he testified that
when he asked about the water supply arrangement he asked: “Is
it a permanent one?
And she says yes: I said: is it a servitude? and
she, - I remember very clearly she says: it is like a servitude.”
31. On further questioning as to the
servitude he testifies as follows:
“… but I did at a stage
said if it is a servitude, surely it must be in the Title Deed and I
don’t think I got
a direct answer, but I did ask whether I can
get a copy of the Title Deed and the answer was no, because Mr
Streicher had died
a couple of years before and he had been right in
the throes of selling his Durbanville property and the whole sale had
come to
a standstill because the estate complications was companies
and whatever and that the Title Deed was caught up in the estate and
it wasn’t available at that stage.”
32. Furthermore he testified as
follows:
“Also it was never told me that
it was a - the water supply was via a written agreement between the
Streichers, Mr Streicher
on behalf of the property owning Company,
Liesbeek Motors and the neighbour, Mr Wallace. It was just a
permanent water supply agreement
or arrangement and it all made sense
to me that this place had been existing since at least 1989 there’d
been up to 45 Aberdeen-Angus
cattle there, there was clearly not so
much agriculture but water culture so that the water challenges had
been solved”.
33. On being asked how the arrangement
physically worked, Young testified as follows to Gibson’s
explanation:
“Frankly I was quite pleased to
get that level of detail, because this was somebody who obviously
knew. She either knew or
she had been briefed, but certainly knew
the detail”
34. What he was told, he testified, was
as follows:
“… I was told that the
windmill was like visible, like a 100 metres away from the main road
and that was 3.2 kilometres
away from this homestead, the water was
piped through a 32mm - its actually not a black plastic. It is a
polyethylene pipe of 32mm.
That is important to me because it can
give me the indication of how much volume of water you can pump in so
many hours. The
- the borehole was owned by the neighbouring farm,
but the windmill itself and the pipes were owned by the Streicher’s
farm,
the farm that I was buying. It was part of that property”.
35. Furthermore he was shown the fairly
high 5 metre water tower with four 5000 litre plastic tanks and a
further five 5000 litre
tanks on the ground. There were thus nine
tanks altogether and he was told the water got pumped into these
tanks.
36. He testified that he had been asked
what he wanted to do with the farm. He explained that he wanted to
do small-scale farming.
37. According to him he had bought a
cheese making machine in Knysna and he wanted two cows so that he
could have fresh milk to
make cheese. Moreover he always liked fruit
trees, not only the existing fruit trees, but he wanted to plant a
few more fruit
trees. When told this Young testified that he
remembered Gibson saying:
“We’ve solved the challenge
or these people have solved the challenge of water for this small
scale operation, but if
you ever wanted to do something big like
big-scale olives – or one of my neighbours three kilometres
away owns the biggest
olive farm in Africa. An incredible thing to
do, but he’s got boreholes and if I want to do something like
that, I would
have to find more water.
So that there was discussions about
extra water and about this other persons in the neighbourhood who was
looking for water. Those
went around extra water, not replacing the
water supply arrangement that I was told was permanent”.
38. When asked to comment on the
Defendant’s plea - to the effect that Gibson would have said to
Young that there was a Water
Supply Agreement with the owner of the
neighbouring property, but she was not aware of all the details and
that he should speak
to Mrs Streicher for more details - Young
responded as follows:
“She did tell me that, but that
was not – that was told to me in Seeff offices in Swellendam
and I was on the premises
first on Monday the 16th and again on
Friday the 20th and that was never mentioned on the premises. By the
time she told me that,
I already knew that there were water
challenges and that that had been solved and I had a full explanation
of how the water worked.
What she – her exact words to me, in
fact I broached the subject, not her. During the discussions around
the offer to purchase,
I sitting in the Seeff offices in Swellendam
with Mr Badenhorst and their internal company attorney was there at
one of the sessions
as least as I said: Should we not include
something about the water? And Mr Badenhorst actually turned to Ms
Gibson, Mrs Gibson
and looked at her and said: What do you say? And
she didn’t look up at me, she just said to me: If you want to
know how
– If you want to know how the details of how the water
works, ask Mrs Streicher.
But I already knew how the water
worked. I knew that they had solved the challenges. I knew that the
water had been working at
least apparently for going on 20 years. My
girlfriend was outside on a very hot summer’s day, with our two
dogs in the car
and I didn’t know Mrs Streicher. There was no
reason for me to stop whatever we were doing, which was finalising
the offer
to purchase and go and phone her to find out how the water
worked. I had been told that.”
39. It is to be remembered that,
initially, Young had not seen the interior of the house and therefore
the offer made on 17 January
2006 contained the following clause:
“The sale is also subject to
final inspection by the purchaser to verify the house is in
accordance with the advertised description
on Seeff’s website
as the purchaser did not have access to the interior of the
homestead”
40. On 20 January 2006 Young inspected
the interior of the property. On this occasion he was accompanied by
Badenhorst from Seeff
with whom he got a lift from Swellendam to the
property. Gibson met them there independently. Furthermore the
“tenant”,
one Mr Raymond Fourie who was renting the
downstairs flatlet from Streicher was also present. Fourie had been
living on the property
for several weeks or months and according to
Young, he once more enquired as to the water situation. He wanted
certain details
from Fourie as to where to go and switch on the water
and the like. Fourie, more or less, precisely repeated the same
run-down
of the 32 mm plastic pipe, the windmill and that, even
though the Water Supply Agreement stated once a week, he was told
that they
were allowed to, or could, fill up twice a week. Fourie
showed him the other boreholes on the property, but explained that
they
were of no effect because “ons praat van brakwater”
and that the water was actually too “brak” to be used
for
irrigation.
41. Young concludes as follows about
the information that he received on 20 January 2006:
“But anyway, everything he
explained to me juxtaposed or dovetailed with what Riana Gibson had
told me, and much of what he
told me. I won’t say every single
thing about we walked off to the boreholes, is that Riana actually
asked him to explain
and in quite a lot of the time she was standing
close within earshot. So anyway that - at the end of the day I had a
pretty comprehensive
understanding about how the water worked. I
heard it twice. I’d had five days to think about it in between
so I was reasonably
sure that this - this place was a going concern
as far as water was concerned”
42. The only significant role that
Badenhorst played in the negotiations was to indicate to Young the
homestead where the neighbour,
Mr Wallace, from whose property the
water was piped, lived.
43. The further significant evidence by
Young as to the water relates to a suspensive condition in the Deed
of Sale that a valuation
would be done of the property. He testifies
that he contacted somebody called Kevin Wynne who lived in Paarl and
who produced
a valuer’s report. This report under the heading
“Land Description” contained the word “Water
Servitude”.
44. Of further importance is the fact
that, shortly before transfer of the property, and while in
occupation of the property as
a tenant, Young was phoned by one of
the staff members to say that they had no water. He thereafter
contacted Streicher who said
that she would see to it. Apparently
this was remedied.
45. The only physical meeting that
Young had with Streicher was at a lunch on 17 February 2006 in the
Strand. He had called upon
her to introduce himself and to tell her
of his intentions with the property. As to the discussions at that
lunch Young testified
as follows:
“So I spent two and a half hours
odd with her over lunch and we certainly discussed the kind of things
I mentioned about my
– my plans for the – ideas for it,
but a lot of the discussion, at least, at least half an hour and
maybe even three
quarters of an hour went around not only the water,
when but also Mr Wallace. There was a lot of discussion about Mr
Wallace and
the plough all kinds of things about neighbourliness, in
fact also about access and gates across the road because of all the
cattle.
All the irritations and things like that. So yes, we
discussed water and the – arrangement, the agreement at some
length,
but not one single thing was said that this was actually a
written Water Supply Agreement and more so, that it actually expired
the previous May. That was not mentioned in the slightest”.
46. Furthermore Young testified that
Streicher told him that he must remember that the windmill and
pipeline belonged to the farm,
although not the borehole itself.
47. Young’s first awareness of
the non-existence of a Water Supply Agreement is described as follows
in a letter by himself
to Mr Gerhard Gous, Streicher’s attorney
of record. In this letter he says:
“1. I telephoned Mr Wallace
yesterday. He almost immediately turned the conversation
confrontational. He told me provision
of water to the Streicher’s
farm was regulated by an agreement with Myburgh Streicher which
expired last year in May. This
is the first time that I knew of this
because when I signed the agreement of sale I was advised that there
is an agreement currently
in place. He said he was no longer
prepared to have an agreement with Mrs Streicher, however he was
prepared to enter into a completely
fresh agreement with me and then
he revealed his stratagem and that’s all about price.”
48. As to when Young initially saw the
expired Water Supply Agreement he testified that at the end of his
lunch with Streicher she
handed him a blue A4 file. When he enquired
as to the contents, she said it was the farm file. Subsequent to
being told by Wallace
that the Water Supply Agreement had come to an
end he perused the file, and in fact found the expired Water Supply
Agreement.
49. From Young’s evidence it
appears that, subsequent to this, he had made various attempts to
reach a new Water Supply Agreement
with Wallace, but by all accounts
the correspondence revealed that there was an intransigence on
Wallace’s part and the issue
of the cost at which Wallace would
supply water was the essential stumbling block. I am of the opinion
that this evidence is not
particularly relevant seeing that it came
to nothing. It is clear that Young made every attempt to obtain
Wallace’s cooperation,
but to no avail. Eventually Wallace
refused to communicate any further. What is clear however, is that
Young tried everything
in his power and did very detailed research as
to the costs of water in the area, but again with no success.
50. During cross examination Young, by
and large confirmed his version, as given in chief. Some of the more
significant aspects
of his evidence during cross examination were:
50.1. As to the visit of Mr Wynne, the
valuator, Young testified as follows:
“Ok, but a couple of days later
Mr Wynne came out there with Ms Gibson in his car. They were
together for four/five hours.
He - she was the only person briefing
him and he came out with an independent report of which, the content
of which I have absolutely
zero to do with. It is in front of us. We
went through it yesterday. It says “servitude”.
50.2. This evidence was not challenged
by Mr Klem who appeared for Streicher.
50.3. Young specifically denied that
Gibson would have said to him that water in the Malgas area was a
problem.
51. As to the issue of the alleged
statement by Gibson that she would have said “if you want to
know how the water works ask
Mrs Streicher” it was put to Young
that Gibson would say the following:
“1. Mrs Gibson can’t
remember where she said it to you, whether it was at the farm or at
the office, but she is prepared
to concede that it happened the way
you described that she told you in relation to the question you asked
about the contract that
you must refer that question about the water
to Mrs Streicher. You got to discuss how the water works with Mrs
Streicher that
will be her evidence”
52. Thereafter Plaintiff closed its
case and withdrew its action against the Second, Third and Fourth
Defendants.
53. The Defendant led a number of
witnesses, of whom only two are of real importance in this matter,
namely Streicher and Gibson.
54. Streicher testified in chief that
she was aware of the fact that water was pumped from Wallace’s
property to the property
from a borehole on Wallace’s property.
She further testified that she knew that there was an agreement
between her late
husband and Wallace. Furthermore she testified that
she knew that, in terms of the aforesaid agreement, there was an
obligation
on Wallace to supply water to the property.
55. She also knew that the agreement
was no longer in force.
56. According to her there were not 45
head of cattle on the property, but 12 head of Black Angus cattle.
57. It is important to note Streicher
only met Young personally on one occasion and that was during a lunch
on 17 February 2006.
58. Resultantly Streicher’s
evidence relates in essence to the question of the mandate as well as
what occurred at the lunch
on 17 February 2006.
59. As to the question of the mandate,
Streicher testified that on the late afternoon of 17 January 2006,
Gibson telephoned her
and told her that she had a signed Sales
Agreement. According to her the fax arrived at 18:33 that afternoon.
60. As to the lunch, Streicher
testified that she had gathered together all her documents pertaining
to the Breede River property
and put them in a file at the front door
so that she would not forget to give them to Young.
61. The file, she testified, contained
the Labour Agreements with her staff, because Young was taking over
her staff plus documents
from the Labour Relations company with which
she had a contract and all other documents, probably the documents
with the rates
accounts as well as the agreement that the late Mr
Streicher had had with Wallace. She further testified that she was
aware of
the fact that the contract with Wallace had expired.
62. According to her he did not tell
her that he intended farming on the property nor that he intended
irrigating a portion of the
property.
63. As to discussing water, her
evidence reveals the following:
“Did you during this lunch,
advise Mr Young there was a borehole on the property of the
neighbouring farm. No, we never discussed
the water or the workings
of that we, just discussed the house.”
64. Furthermore Streicher testified
that Young never advised her that he intended to stay on the property
permanently.
65. Streicher further admitted that she
was dependant on her neighbour for water, but testified as to the
plans for the future as
follows:
“Yes. I was dependent on my
neighbour, but Mr Paul de Waal and I were in discussions with Mr
Wallace to broker an agreement
and as well as Mr de Waal, was also
looking for water, and should he find water the two of us would have
gone together into that
water agreement.”
66. She testified that she and Paul de
Waal were trying to achieve a permanent water arrangement.
67. Of further significance is the
following evidence by Streicher:
“The fact of the matter is that
your property was not independent for water, it was reliant on
neighbouring properties for
water, was it not. Yes, if you wanted to
do more than just weekends”
68. During cross-examination, Streicher
confirmed that the supply of water from Wallace’s farm was a
matter of great importance
to them.
69. Streicher further testified that
neither she, nor her husband had had any difficulties with Wallace
regarding the water. She
testified as follows:
“And prior to the death of your
husband, you had no difficulties I think you testified that there
were no problems. Absolutely
none.”
70. When confronted with the following
e-mail by herself to Young,
“Does this man have no shame and
no end? He did the same to me and kept closing our water even, though
we had a valid water
contract. What is his case? What happened to
peace and joy to all mankind?” her answers were vague in the
extreme. Despite
the aforesaid, Streicher simply denied that she had
had any problems with Wallace regarding water.
71. As to the mandate, and more
particularly the issue of how it was possible that Streicher could
have received a signed agreement
before any previous contact had been
made with her, while the signed agreement in fact contained an
annexure which clearly emanated
from her, she was unable to answer
the question adequately.
72. As to the issue of changing her
sworn affidavit (which was also confirmed by Gibson) she had to admit
that her evidence contradicted
what was contained in the affidavit.
73. When confronted with the question
that both versions cannot be true her answer was as follows:
“I stand by the story that Ms
Gibson phoned me on the 17th to ask – to tell me she had a
signed sales contract.”
74. Ultimately the following exchange
between Mr Fagan for the Plaintiff and Streicher is significant.
“But which again means it
couldn’t have been a signed contract - if that information came
off your fax and it couldn’t
have been a signed contract before
that fax was sent by you. Once again, maybe my memory is fading.”
75. As to the lunch on 17 February
2006, when asked whether the water had been discussed and why
Streicher did not inform Young
about the water problems, her evidence
was that they had not discussed water, but only the house.
76. Despite admitting that water was an
important issue and that she probably should have told Young, she
certainly did not do so.
77. Furthermore Streicher specifically
denied that the water issue and Wallace were discussed with Young at
this lunch at all.
Ultimately, when it was put to her that it is
overwhelmingly probable that the issue of water had been discussed
with Young, Streicher
answered:
“That might be so, but I am
afraid I don’t recall.”
78. In contrast to the aforesaid
evidence the following evidence by Streicher is significant:
“And you were trying to conclude
an agreement for permanent water from Mr Wallace’s farm…
Yes. And you were doing
that for a reason. Yes, so that I would have
a permanent water arrangement so that there wouldn’t be a
concern about whether
it was going to rain or not rain and that my
staff could have as much water as what they wanted. It is always
nice to have more
water. We wouldn’t have needed much more but
it is nice to know that there is more”.
79. When asked whether she thought it
was likely that Young would have discussed water with the estate
agent her answer was:
“He probably would ask about a
lot of other things as well.”
80. During her evidence in chief Gibson
testified that she could remember having met Young in January, but
that she was not sure
of the date.
81. According to her, she informed
Young that fresh water in the Malgas area was a problem.
82. She further testified as follows:
“I informed him that there is an
arrangement with the neighbour for water. I also told him that I am
not sure of the particulars
of or the - details of this arrangement.
I was also told that the - another next door neighbour was also
looking for fresh water
and that him and Mrs Streicher had an
agreement that, if he should find fresh water, they would share the
costs of running pipes
to the respective properties and, of course
any implements that needed to be installed as well as pumping water.”
83. According to her, this information
was given to her by Raymond Fourie who was the “tenant”
on the property.
84. Gibson denied that Young had
advised her that he intended living permanently on the property nor
that he intended having a couple
of cows to make his own cheese.
85. As to the issue of whether Young
had asked whether the water arrangement was a permanent one, her
answer was as follows:
“Mr Young, I am sure would have
asked, but I did tell Mr Young that I didn’t have any details,
and I did refer him to
Mrs Streicher.”
86. As to the issue of whether Young
asked her whether the arrangement was in terms of a servitude her
answer was simply that:
“He could have. I can’t
remember.”
87. Furthermore, she testified that it
is possible that Young could have asked her for the title deeds.
88. When confronted with Young’s
evidence that, at the meeting in Swellendam where Young alleges that
he asked whether they
should not refer to the water arrangement in
the offer to purchase and the fact that Badenhorst looked at Gibson
and asked whether
it was necessary to contain it in the agreement and
that she replied no, her comment was as follows:
“I can’t remember it
happening, but if it did happen, I would understand why I said no:
because the offer to purchase
had to do with the property. The
arrangement with the water would be an arrangement between the owner
of that neighbouring farm
and either Mrs Streicher or the new owner.
It is not something that is included in the sale.”
89. As to the issue of her mandate and
the fact that she had indicated that she had first obtained
permission to show the property,
Gibson testified that it is
factually incorrect.
90. Of further significance is that
Gibson denied ever having travelled to the property with the valuer,
Wynne.
91. Under cross-examination Gibson
again stated that regarding the mandate she had made an honest
mistake in her affidavit.
92. When confronted with the fact that
both Streicher and Gibson’s affidavits were similar the
following exchange took place:
“Aren’t the overwhelming
probabilities, Ms Gibson, then that what you and she both remembered,
was simply correct?
Possibility is there that she gave me permission
before the time to go - and well to show Mr Young the property when I
contacted
her. Yes and that would have been then on the 16th
according to the days given to me – Yes.”
93. Finally the following was put to
Gibson:
“Well your evidence yesterday you
see was that the first time you made contact with her was only after
you had the offer to
purchase. Now that we know is not right.
Yes.”
94. On being questioned whether her
memory, as to what had transpired at the Seeff Offices at Swellendam
was poor, Gibson testified
that:
“Of those visits, yes absolutely
that time actually.”
95. Gibson furthermore admitted in
cross-examination that water was a material issue.
96. Mr Fagan, on behalf of Young,
specifically put the following to Gibson:
“Similarly I would suggest to
you, you can’t remember clearly what exactly was discussed
regarding water generally -
Generally no.”
97. Similarly the following evidence is
relevant:
“What I do remember is that I did
tell him that fresh water and Malgas is a problem. I definitely
mentioned the water agreement
to him and I definitely mentioned the
other neighbour that was looking for water as well or another water
source and that would
have been the water information that I gave to
him. But there might have been further information, you don’t
recall that…
I don’t recall not at all, no.”
98. When Gibson was asked whether she
would have asked Streicher about details concerning the water, her
answer was that she could
not remember, but she was pretty sure that
she would have.
99. Gibson confirms this as follows:
“Yes, so you say you’re are
pretty sure you would have asked Mrs Streicher about this, but you
can’t recall doing
so. No, I don’t, but I am sure I would
have.”
100. So too the following evidence of
her discussion with Streicher is significant:
“So there was some discussion
about water, but what precisely it was you don’t now recall…
No.”
101. She further admitted that she
would have told Young that water in the Malgas area was a problem in
response to questioning
by Young.
THE ISSUES
102. To my mind the essential issues to
be decided are:
102.1. Who was the mandator?
102.2. Was there a representation and
was it false?
102.3. If there was a representation,
was it done by Defendant with the necessary intention?
THE MANDATE
103. In my view there is no merit in
Defendant’s contention that Young was in fact the mandatory and
not Streicher. I say
this for the following reasons:
103.1. The contract itself records, in
clause 13.5, that Young was introduced to the property by the
Defendant and not by any “party”
other than Seeff and
that Seeff is the effective cause of the sale;
103.2. Clause 26 also records that the
deed of sale was negotiated by Gibson;
103.3. It is clear that Young contacted
Attenborough who was the Seeff Agent for the Witsand Area and she, in
turn, referred him
to Gibson to show him properties on the Malgas
side of the river.
103.4. Furthermore, Attenborough
indicated to Young that what she called her “favourite
property” on the river was the
White House which would be shown
to him.
103.5. It is important to note that
Attenborough did not testify and the only witness, on the question as
to whether Young was the
mandator, was himself. His evidence was
unequivocal. His discussions with Attenborough had only pertained to
properties on the
Seeff books. The property was on Seeff’s
books and on its website. Even if the evidence suggests that the
property might
have been on Seeff’s books erroneously, in as
much as Seeff’s previous mandate to sell it had been terminated
by the
late Mr Streicher, this has no relevance to this case.
103.6. Young never considered that he
might be liable for the payment of commission. He was certainly never
told that he would be
liable for commission, nor was he factually. I
can think of no reason why commission would be payable to an estate
agent by a
party other than one that gave the mandate.
103.7. The issue as to the affidavits
and the retraction of the admissions therein clearly shows that both
Streicher and Gibson
were economical with the truth, to say the
least. To my mind it is not worth analysing all the evidence, save
to say neither
Streicher nor Gibson was credible on this issue.
103.8. In any event, even on
Streicher’s own version, she at least gave Gibson permission to
show Young the interior of the
house prior to the deed of sale being
concluded on 24 January 2006. Thus Seeff, even on Streicher’s
own version, at the very
least had a tacit mandate to sell the
property. As pointed out hereinbefore, Gibson ultimately conceded
that the conversation
with Streicher could have taken place on 16
January 2006. In this case she would have had Streicher’s
permission to show
the property.
103.9. Furthermore Streicher’s
intention was to sell the property. In my view Streicher’s
permission to Gibson to show
the property amounted to an express
mandate, given the fact that the property was already on the market.
At the very least it
constitutes a tacit mandate.
THE REPRESENTATIONS
104. As is evident from the evidence
aforesaid, the only person who can really testify as to the
representations that were made
to Young, were Young and Gibson.
105. Young visited the property on two
occasions before concluding the deed of sale. The first was on 16
January 2006 and the second
on 20 January 2006. On both these
occasions both he and Gibson were present.
106. Furthermore, it is evident that on
Young’s second visit to the property Badenhorst was present as
well as a so-called
“tenant”, one Raymond Fourie.
107. As Badenhorst was not called as a
witness and neither was Fourie, Young’s evidence as to
Badenhorst’s involvement
is the only evidence before me. This
evidence was that when Young asked Badenhorst whether a property they
had driven past was
the neighbour, from whom the water came in terms
of the water supply arrangement, Badenhorst had answered in the
affirmative.
108. As appears from the evidence
aforesaid Gibson’s memory of what took place was, to say the
least, to use her own word
“foggy”. She could remember
that there had been some discussion about water, but not precisely
what it was. She did
however confirm that Young definitely asked her
about water.
109. In my view, bearing the aforesaid
in mind, Young’s version is to be preferred and should prevail.
110. I therefore accept that Gibson
made a number of representations to Young regarding the property and,
more particularly, about
the water supply from Wallace’s
property to the property. I thus accept the following evidence by
Young:
110.1. That he had asked a lot of
questions, because when one is buying property, especially a farm,
one must know a lot about things
like sewerage, electricity and
water.
110.2. That he was asked whether he
intended living on the property and that he had answered in the
affirmative, stating that he
wanted to live there semi-permanently.
110.3. That Gibson had told him that
there were water challenges, but that these had been solved through a
water supply arrangement
with the neighbouring farm.
110.4. That he had asked whether the
arrangement was a permanent one and that Gibson answered in the
affirmative, upon which Young
had asked whether it was a servitude
and Gibson had said, it was “like a servitude”.
110.5. That he was not told that there
was a written water supply agreement.
110.6. That Gibson was able to give
Young a great deal of detail regarding the water supply from
Wallace’s farm.
110.7. That he advised Gibson that he
wanted to do small-scale farming on the property and that Gibson had
advised him that this
was feasible with the available water.
110.8. More particularly, I accept the
evidence of Young to the effect that he was told by Gibson that the
arrangement with Wallace
was “like a servitude”. Gibson
could certainly not refute this evidence as she had only a hazy
recollection of what
had been discussed.
110.9. To my mind it is inherently
probable that Young’s evidence is accurate. This is so because
Young’s follow up
question related to the title deeds. The
response that these title deeds were caught up in the deceased estate
of the late Mr
Streicher cannot be explained in any other way. It is
important to note that this fact was never queried under
cross-examination.
The question that arises is how Young would have
known about the whereabouts of the deeds, if Gibson had not told him.
110.10. Furthermore, I accept Young’s
evidence that the valuer, Kevin Wynne confirmed that the water supply
was a servitude.
That this was a comfort to Young, is evident.
111. That a principal is liable for
misrepresentation made by his or her agent, is trite.
112. The Appellate Division (as it
then was) in Randburg Beperk v Santam Versekeringsmaatskappy Beperk
1965 (4) SA 363
A at page 372C - F sets out the legal position as
follows:
“Ek sou eerder meen dat die
volgende stelling uit ‘n Engelse gewysde wat in Ravene
Plantations Limited v Estate Abrey
and Others
1928 AD 143
op bladsy
153 goedgekeur word, ook vir die geval waar magtiging van ‘n
agent om voorstellings te doen regtens versonderstel
word, hier van
toepassing is:
“I think that every person who
authorises another to act for him in the making of any contract
undertakes for the absence
of fraud in that person in the execution
of the authority given as much as he undertakes for its absence in
himself when he makes
the contract.”
Dit is redelik dat die prinsipaal wat
sy verteenwoordiger kies en hom voorhou as ‘n betroubare
persoon, en nie die ander party
wat geen seggenskap by die keuse het
nie, die risiko van sy moontlik oneerlike voorstelling of verwysings
sal dra, ook waar die
oneerlikheid so ‘n gestalte aanneem dat
die Verteenwoordiger dit uit die aard van die saak ongetwyfeld vir
die ander party
sal verberg. Dat ‘n versekerde hom in ‘n
geval soos hierdie op die aangevoerde grond die voordeel van sy
verteenwoordiger
se bedrog of misleiding kan toeëien, ten koste
van ‘n argeloos onwetende versekeraar, is ‘n
gevolgtrekking wat
ek nie vir ons reg kan aanvaar nie.”
113. Accordingly I find that the
representation made by the agent, Gibson was authorised by Streicher
in the sense that she accepted
the risk of those representations.
114. That the representations were
material goes without saying. As Young testified repeatedly without
water the property was worth
nothing.
THE VOETSTOETS CLAUSE
115. In the present matter the contract
contains a voetstoets clause as well as a so-called
non-representation clause.
116. In Odendaal v Ferraris
2009 (4) SA
313
(SCA) Cachalia J A at page 537 says the following:
“It is trite that if a buyer
hopes to avoid the consequences of a voetstoots sale, he must show
not only that the seller knew
of the latent defect and did not
disclose it, but also that he or she deliberately concealed it with
the intention to defraud (dolo
malo). Where a seller recklessly
tells half-truth or knows the facts, but does not reveal them because
he or she has not bothered
to consider the significance, this may
also amount to fraud. But as the Court has said fraud will not
lightly be inferred, especially
when sought to be established in
motion proceedings. And where a party seeks to do so the allegations
must be clear and the facts
upon which the inference is sought to be
drawn succinctly stated.”
117. Furthermore in the present case
the seller is a company. In this respect Blackman “Companies”
in Joubert the Law
of South Africa 1st re-issue, Volume 4(1) at
paragraph 35 sums up the legal position as follows:
“Whenever liability depends upon
the performance of an act or a mission by the company itself, or
possession by the company
of a particular state of mind, the law
treats the act or state of mind of those who represent and control
the company as the acts
and state of mind of the company itself.”
See also Levy v Central Mining and Investment Corporation Limited
1955 (1) SA 141
A at page 149H to 150A, R v Kritzinger
1971 (2) SA 57
A at page 59E – F, Anderson Shipping (Pty) Ltd v Guardian
National Insurance Company Limited
1987 (3) SA 506
A at page 515H –
J and Commissioner of Inland Revenue v Malcomuss Properties (Isando)
(Pty) Ltd
1991 (2) SA 27
A at page 36G – 37H.
118. To my mind there is no evidence to
show that either Badenhorst or Gibson knew that the representation
that they were making
was false at the time when they made them.
Furthermore Streicher did not make any representations regarding the
water. In order
to escape the effect of the voetstoots and
non-representation clause it is therefore necessary for me to
consider whether Streicher,
who represented the Defendant for these
purposes either knew that false information would be used by
Badenhorst and Gibson to make
representations to the Plaintiff or
foresaw the possibility that false information might be used and
reconciled herself to this
because she did not bother to consider its
significance.
119. It is therefore necessary to
consider whether Streicher recklessly told the half-truth or knew of
facts, but did not reveal
them, because she had not bothered to
consider their significance as required in Odendaal v Ferraris op
cit. In other words, has
the Plaintiff succeeded in proving the
necessary intention on the part of Streicher?
120. What Streicher knew or foresaw in
this regard, by the nature of things, in the present matter can only
be determined inferentially.
121. In my view, on the probabilities,
the necessary inference can be drawn against Streicher and therefore
against the Defendant
for the following reasons:
121.1. Gibson testified that she was
not sure of the details regarding the water supply agreement as she
did not have the written
agreement and could not confirm anything.
Then however, she said:
“And Mrs Streicher did not give
me any details either. I can’t remember whether I asked her
about it, but I am pretty
sure I would have.”
121.2. Thereafter she repeated this and
confirmed that she would have asked Streicher “because that is
part of what you would
regard as your job as an estate agent.”
121.3. If this is so the only
conclusion can be that Streicher was aware that Young had raised the
issue of the water or at the
very least, she should have anticipated
that he would raise the issue of the water.
121.4. To my mind Streicher’s
testimony was not only evasive, but sometimes blatantly dishonest. I
say this for the following
reasons:
121.4.1. Streicher testified that she
had no dispute with Wallace regarding water.
121.4.2. She testified that she had
only spoken to Wallace once, when her staff told her that they were
running short of water.
121.4.3. Furthermore she testified that
Wallace had been very agreeable and had put the water back on.
According to her there had
been no dispute.
121.4.4. According to her there were
absolutely no problems in regard to water, prior to Mr Streicher’s
death.
121.4.5. This evidence by Streicher was
however directly contradicted by the e-mails sent by her to Young in
which she said:
“Does this man (Wallace) have no
shame and no end?? He did the same to me and kept closing our water
even though we had a
valid water contract. What is his case??? What
happened to peace and joy to all mankind?”
121.4.6. I have already mentioned the
testimony concerning the date on which Gibson had a conversation with
Streicher in which she
allowed Gibson to show the property to Young.
As I found previously this was clearly untruthful.
121.4.7. Streicher’s evidence was
that at the lunch on 17 February 2006, Wallace was at no stage
discussed. This, in turn,
is contradicted by an e-mail which she
sent to Young on 23 February 2006, in which she refers to what she
had told Young regarding
the access road to the property which
traversed Wallace’s property. Streicher testified that she had
never discussed water
with Young. However, she testified that he had
told her that he needed to repair the water tanks under the house.
Clearly water
was discussed on 17 February 2006.
121.4.8. As referred to before,
Streicher’s belated endeavour to make the estate agents Young’s
agents, rather than
hers, smacks of dishonesty and could only have
served the purpose of avoiding liability for misrepresentations made
by her agents.
This attempt by Streicher served only to cast doubt
on the veracity of her evidence in general.
121.4.9. From the evidence it is clear
that Young, Streicher and Gibson agreed that water was of crucial
importance to the property.
121.4.10. Streicher herself testified
that she knew that the supply of water from Wallace’s farm was
a matter of great importance.
She also knew that the only available
source of water, other than run-off water from the roof, which was
insufficient for the
purposes of the property, was by way of the
pipeline from Wallace’s property.
121.4.11. She furthermore knew that the
agreement with regard to water had come to an end. The resultant
unavailability of water
to the property was something which, to my
mind, should have been conveyed to a prospective purchaser.
121.4.12. This is more so if regard is
had to the fact that the property had a successful and vibrant
garden; it had been marketed
as a small hotel or large guest house,
it had 26 rooms including 6 on-suite bathrooms. It had a swimming
pool. The property gave
the impression that there was no shortage of
water.
121.4.13. When it was put to her that,
on her version, she had not told Gibson anything about the water
problem and knowing that
Gibson was trying to sell the property to
Young she responded “I told Miss Gibson nothing, knowing that
she presented me
with the sales contract.”
121.5. To my mind it is obvious that
Streicher knew that Young would, in all probability, ask about the
water. She furthermore
knew that the less she told Gibson, the more
certain it was that Young would be brought under a misapprehension
regarding the water.
Clearly Streicher knew that the water
arrangement had come to an end. This she should have revealed. Not to
have done so, because
she had not bothered to consider its
significance, amounts to fraud.
122. I thus find that Streicher had the
necessary intention needed to avoid the consequence of the voetstoots
and non-representation
clauses.
123. It is furthermore self-evident to
my mind that, had Young been advised about the termination of the
water supply agreement,
the Plaintiff would either not have purchased
the property or would have purchased the property at a price below
that which he
paid.
124. Furthermore, it is clear that the
only purpose of the Defendant not disclosing the termination of the
water supply agreement
was to induce the Plaintiff to purchase the
property at the highest price possible.
THE DEFENDANT’S FURTHER
DEFENCES
125. It would seem that Defendants rely
on the following dictum from Odendaal v Ferraris op cit at page 324
(paragraph 35)
“As a general rule, where a buyer
has an opportunity to inspect the property before buying it, and
nevertheless buys with
its patent defects, he or she will have no
recourse against the seller. It is apparent that respondent
discovered the water damage
immediately after taking occupation- ,
and thus that he would’ve done so, had he asked for access at
the time of the inspection.
He has himself to blame for failing to
do so and cannot hold his failure against Appellant.”
126. What is immediately apparent from
this dictum is that it relates to patent defects. In the present
case the defects are clearly
not patent. No amount of looking at the
property could have indicated to Young that there was a lack of
water. In fact the very
opposite is clear.
127. It is trite law that contributory
negligence can never be a defence to intentional wrongdoing. Even if
such a defence existed
in our law, it would not succeed in this case,
as Young says that he did ask questions about the water and that he
received answers
and he had no cause to think that those answers were
false. He knew everything he needed to know about the water and the
agreement
with Wallace except that there had been a written agreement
that had expired. This information he could only have obtained from
Streicher, and in my view, there was an onus on Streicher to bring
these facts to Young’s knowledge. As Young testified,
the only
reason that there could have been a problem is that he was being lied
to.
128. As appears from my analysis of the
evidence hereinabove, I accept that Young was told that there had
been a permanent water
arrangement that was “like a servitude”.
To my mind this lends credence to Young’s evidence that he
understood
the remark by Gibson as to “how the water works”
to mean the precise mechanics of the amount of water, the working of
the valves and the like. Seen in its context, I am of the view that
it was not unreasonable for Young to have placed this interpretation
on the words, “how the water works”.
129. It was furthermore argued that,
the fact that Young admitted that he had been told that the neighbour
was looking for water
and that Streicher intended to share this
water, should have alerted him to the fact that there was not enough
water and therefore
he should have been more vigilant.
130. What is clear from the evidence
quoted hereinabove is that Streicher herself thought that extra water
would come in handy.
To my mind it is not unreasonable for Young to
have thought that this referred to extra water, should he intend
full-scale farming.
131. Furthermore, it was argued that
the fact that Streicher handed Young a copy of the Water Supply
Agreement although she did
not alert him to its presence in the blue
A4 file was indicative of the fact that Streicher was not hiding
anything. It is clear
that Streicher failed to alert Young about the
expired water agreement. This failure is never properly explained.
In the context
of the case as a whole I do not think that the
handover of the blue A4 file is sufficient to neutralise Streicher’s
intention.
In my view it should be seen in the context of the
following dictum form Odendaal v Ferraris opcit:
“Where a seller recklessly tells
a half truth or knows the fact but does not reveal them because he or
she has not bothered
to consider the significance this may also
amount to fraud”.
COSTS
132. The costs of the joinder
application were settled by the parties inter partes and made an
order by myself.
133. The costs occasioned by the
postponement of the trial on 11 September 2013 to April 2014,
including the costs of the Applicant’s
application for
postponement have stood over for determination by me.
134. In my view, the postponement was
purely as a result of the Defendant’s very late amendment to
its Plea and the resultant
need to join the estate agents as further
Defendants, and should be for the cost of the Defendant.
135. The costs occasioned by the
further postponement of the trial on 14 April to 1 September 2014
also stood over for later determination.
The matter was postponed on
that date because the estate agents had not yet been joined. In my
opinion the Plaintiff had ample
opportunity to join those Defendants
and Defendant cannot be held liable for the costs of the
postponement. Those costs should
be borne by the Plaintiff.
CONCLUSION
136. It is accordingly ordered as
follows:
136.1. Judgment in respect of the
separated issues, so far as those issues pertain to the dispute
between the Plaintiff and the
Defendant, is granted in favour of the
Plaintiff.
136.2. The questions of law and fact
that arise from paragraph 20 to 27 of the Particulars of Claim as
amended and from paragraph
8 to 10 of Defendant’s Plea, as
amended, are postponed for later determination.
136.3. Defendant is to pay the
Plaintiff’s costs on the party and party scale as taxed or
agreed.
136.4. Such costs are to include the
costs occasioned by the postponement of the trial on 11 September
2013, including the costs
of Plaintiff’s application for
postponement.
136.5. Plaintiff is to pay the wasted
costs occasioned by the further postponement of the trial on 14 April
2014.
BLOMMAERT A J
CAPE TOWN