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IN THE HIGH COURT OF SOUTH AFRICA

(EASTERN CAPE DIVISION)

CASE NO. 1638/2006

In the matter between:

DOUGLAS RORY SWANEPOEL 1^st Applicant

SHARNÉ SWANEPOEL 2^nd Applicant

and

J T & T AGENCIES AND MAINTENANCE CC Respondent

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JUDGMENT

________________________________________________________________

EBRAHIM J:

Introduction

1. This application was brought as a matter of urgency by the first and second applicants, who act in their representative capacities as the trustees of D J G J Property Trust (‘the Trust’) which is the owner of a PMSA VB1X machine P500 counter current pan mixer, chain conveyor and stacking gantry and ancillary equipment (hereafter collectively referred to as ‘the  machinery’).

2. The machinery, which is utilised in the manufacture of bricks and blocks, was leased for this purpose by the Trust to the respondent in terms of a written rental agreement (‘the agreement’) signed on the respondent’s behalf on 1 July 2005 and on behalf of the Trust on 5 August 2005.

3. The relief the applicants seek is based essentially on two grounds. The first ground is that the respondent has not complied with the two suspensive conditions of the agreement. The applicants contend that in consequence thereof the agreement is null and void and seek an order confirming this. In the alternative, the applicants seek an order confirming their cancellation of the agreement. In either case the applicants also seek an order that the respondent hand over the machinery.

4. The second ground is that the respondent has breached the provisions of clauses 5.2, 5.4, 5.5, 5.7 and 5.14 of the agreement. These provisions concern the respondent’s obligations regarding the use of the machinery, the persons who may operate it, the circumstances under which the agents of the Trust are permitted to carry out an inspection or examination of the machinery, and the respondent’s responsibility to service, maintain and safeguard the machinery.

5. The applicants accordingly seek an order in the following terms:

‘1. That this application be heard as a matter of urgency and that the forms and service be attenuated accordingly, in terms of Uniform Rule 6 (12).

2. 2.1 Declaring the rental agreement in respect of the PMSA VB1X machine and related equipment, being Annexure “DS1” to the Founding Affidavit of the First Applicant, null and void.

2.2 Ordering the Respondent to hand over the PMSA VB1X machine and related equipment.

Alternatively to 2.1 and 2.2

2.3 Confirming the cancellation of the rental agreement in respect of the PMSA VB1X machine and related equipment, lawfully cancelled by the applicants.

2.4 Ordering the Respondent to hand over to the possession of the Applicants the machine in respect of the PMSA VB1X machine with related equipment forthwith.

3. Alternatively to paragraph 2 and in the event only that this Honourable Court declines the relief sought in prayers 2.1 and 2.2 above, or in 2.3 and 2.4 above:

3.1 Ordering the Respondent to forthwith cease operating and close down the PMSA VB1X machine and related equipment.

3.2 That paragraph 3.1 operate as an interim interdict with immediate effect pending the finalisation of proceedings by the Applicants to confirm or effect the cancellation or declaring void, the rental agreement reflected in Annexure “DS1” to the Founding Affidavit of the First Applicant, and to detain the return of the equipment referred to therein.

3.3 Ordering that the costs of this application be reserved and be determined in the proceedings referred to in paragraph 3.2 above.

4. In the event of this Honourable Court granting the relief contemplated in paragraphs 2.1 and 2.2 above or in 2.3 and 2.4 above, an order that the Respondent pays the costs of this application on an attorney and own client scale.

5. Further and/or alternative relief.’

6. On 1 June 2006 the applicant was granted interim relief that stipulated that ‘the Respondent [is to] cease operating the PMSA VB1X machine and related equipment by 17h00 on 2^nd June 2006 until the 8^th June 2006’. This interim order was extended subsequently until the hearing of this matter and again until judgment is handed down.

7. Before dealing with the merits of the application it is necessary that I deal with an ancillary application that was launched by the applicant due to developments that took place after the respondent had delivered its answering affidavit.

The applicant’s ancillary application to strike out

8. In an ancillary application dated 24 May 2006 the applicants seek an order:

‘1. Striking out, in terms of Rule 6(15) of the Rules regulating the conduct of the proceedings of the several Provincial and Local Divisions of the High Court of South Africa, the entire contents of the affidavit of Collin Russell dated 24 May 2006 filed in support of the Respondent’s opposition to the Applicants’ main application herein, by virtue of such contents being scandalous and/or vexatious and/or irrelevant;

2. Striking out from the affidavit of Cornelius Johannes Wessel Thysse, signed before Captain F Sidzatane on 24 May 2006 the following –

i) The entire content of paragraph 16;

ii) The entire content of paragraph 17 save for the last sentence;

iii) The sentence “In this regard I refer to the Affidavit of Colin, wherein it is clear that the repairs or maintenance required, can wait for June 2006, and that the delay shall not cause any harm to the machine” in paragraph 18 thereof;

iv) The entire content of paragraph 19;

v) That portion of paragraph 20 commencing “Prior to December 2004 the machine by all accounts ….” (at page 13 of the affidavit) up to and including the sentence ending “and that accordingly they should seek damages from Mr John Swanepoel” (near the top of page 14);

vi) The sentence “The allegation that the boards are beyond use is totally untrue and I refer to the Affidavit of Collin Russell” at paragraph 21;

by virtue of the fact that the aforesaid is based upon the affidavit of Collin Russell, the entire content of which the Applicants seek to strike out in terms hereof and in consequence of which the paragraphs and/or sentences of various paragraphs identified hereinbefore in the affidavit of Cornelius Johannes Wessel Thysse are hearsay.

3. By striking out paragraph 3 of the affidavit of Darryl Lello signed before Inspector Heuer on 24 May 2006 in that same refers to and is based upon the affidavit of Collin Russell, the entire content of which the Applicants, in terms hereof, seek to strike out.

4. Striking out from the affidavit of Albert Gehring, the following by virtue of the fact that it refers to and/or is based upon the affidavit of Collin Russell, the entire content of which the Applicants seek to have struck out in terms hereof –

i) The sentences commencing “in this regard I refer to the Affidavit of Mr Collin Russell. I confirm that …...” and ending “as it refers to the care, maintenance and condition of the machinery and parts” at paragraph 15 thereof;

ii) The sentence “As mentioned, Mr Russell has confirmed that he is attending to condition monitoring on a daily basis” at paragraph 19;

3. The first sentence of paragraph 24.’

9. The application to strike out was opposed by the respondent. After argument was presented by Mr Cole, for the applicants, and Mr Brooks, for the respondent, the Court granted the order as prayed for. The Court’s reasons for doing so were to be furnished later and these now follow.

10. The application was premised on the fact that Collin Russell (‘Russell’), in an affidavit attested to on 25 May 2006, had disavowed the truthfulness of the affidavit he attested to on 24 May 2006 that was filed in support of the respondent’s answering affidavit. The reason proffered by Collin Russell for retracting what he had stated in the affidavit dated 24 May 2006 was that he had lied when he made it. He amplified this by stating, inter alia, that the ‘majority of its contents are not all true or worded correctly’ and that the affidavit was made ‘in front of parties who made me feel intimidated and threatened because of comments made previously’. He added that he ‘agreed to partake and make un true (sic) statements to protect myself and my family to avoid losing my job’ and now ‘wish[ed] to be granted another chance to make an affidavit of my own without any input or intimidation from any parties’.

11. In its affidavit opposing the application to strike out the respondent refuted Russell’s claim that he had been threatened with dismissal or intimidated in any manner. The respondent alleged that the affidavit of 24 May 2006 was based on facts Russell had provided and various amendments had been made at his request before he signed it.

12. In a supporting affidavit the respondent’s attorney of record, Catherine Gray, asserted that in ‘making his further affidavit dated 25 May 2006, Mr Russell in no way intended to retract each and every statement made in his Affidavit filed of record, and particularly the statements in respect of the condition of the machinery’. Further, Russell had informed her he was not prepared to furnish a further affidavit in amplification or clarification of his affidavit of 25 May 2006 but was prepared to give oral evidence, if requested by either party. In view of this the respondent sought that the application to strike out be referred for oral evidence ‘in the interests of proper ventilation of the matter’.

13. It is common cause that Russell has retracted what he stated in the affidavit dated 24 May 2006. In an attempt to undermine Russell’s claim that the ‘majority of its contents are not all true or worded correctly’ the respondent has asserted that the contents of the affidavit emanated from Russell. However, this does not assist the respondent since Russell has not denied that he made the affidavit but has disavowed the truthfulness of its contents. It is immaterial whether or not Russell provided the information at the time. The crucial fact is that he has now pertinently denied that it was the truth.

14. The respondent’s request that the issue of Russell’s retraction of his affidavit dated 24 May 2006 be referred for oral evidence is devoid of any legal substance. Russell is the respondent’s witness and his affidavit was tendered in support of the respondent’s answering affidavit. The dispute regarding its truthfulness is an issue to be resolved between the respondent and him. It does not involve the applicants. It is manifestly, therefore, not a dispute of fact between the parties arising out of what has been stated in the papers and necessitating resolution by the Court on that basis.

15. The respondent has disclosed that Russell refused to furnish a further affidavit to clarify which portions of the affidavit dated 24 May 2006 were lies or had been worded incorrectly. Despite this the respondent contends that Russell has not recanted each and every statement in the affidavit. The respondent is quite evidently clutching at straws. In my view it would be an exercise in futility to speculate which portions of the affidavit are true and which untrue. In any event Russell has stated unequivocally that the Court should disregard his affidavit dated 24 May 2006 and not merely particular portions thereof. The effect of this retraction is that no reliance can be placed on the entire contents of the affidavit.

16. Consequently the Court held that the applicants’ application to strike out was well founded and granted an order in terms of prayers 1, 2, 3 and 4 of the notice of motion dated 30 May 2006.

The merits of the main application

Respondent’s alleged breach of the suspensive conditions of the agreement

17. The suspensive conditions in the agreement read as follows:

‘21 Suspensive Condition

21.1 This agreement is conditional upon the Lessee successfully entering into, within six months herefrom, a lease agreement with the Buffalo City Municipality in respect of the immovable property at which the machinery is presently located, on the same, or similar, terms and conditions as presently exist between Buffalo City Municipality and Ingonyama Blocks and Bricks/the Lessor.

21.2 This agreement is furthermore conditional upon all members of the Lessee, and Mr Johan Thysse if he is not a member, signing deeds of suretyship as per annexure B hereto on or before the close of business on 31 March 2005 and supplying, within the same period, proof of such signature to the Lessor. This suspensive condition is inserted for the benefit of the Lessor and may be waived by it or before the close of business on 30 June 2005, in writing.’

18. Mr Brooks has admitted that the respondent did not comply with the suspensive conditions but contended that non compliance did not render the agreement null and void. The applicants, he contended, had delayed in invoking the provisions and as a consequence thereof tacitly waived the right to expect compliance from the respondent. The effect of this delay, according to him, amounted to estoppel.

19. Mr Brooks differed with Mr Cole’s submission that the waiver had to be in writing. The requirement that it be in writing, he claimed, applied only until 30 June 2005 but not if the waiver took place thereafter. The argument he advanced was informed by the interpretation he asserted had to be placed on the last sentence in clause 21.2 which reads, ‘This suspensive condition is inserted for the benefit of the lessor and may be waived by it on or before the close of business on 30 June 2005, in writing.’

20. This argument is wholly unpersuasive. The interpretation Mr Brooks seeks to place on the sentence is in conflict with the plain and ordinary language that has been used. I do not find any ambiguity in the wording. The sentence is to be read in the context of the provision as a whole and not independently thereof. If this is done, as it should be, the meaning is clear. What the sentence conveys is that before the close of business on 30 June 2005 the lessor could elect to waive the suspensive condition (clause 21.2) and in the event that it did so the waiver had to be in writing. I find no support for an interpretation, as contended by Mr Brooks, that after 30 June 2005 a written waiver was no longer a pre requisite. This submission is without merit.

21. Mr Cole has emphasised that Clause 16 of the agreement provides:

‘16. Indulgence

No relaxation or indulgence granted by the Lessor to the Lessee shall be deemed to be a waiver of any of the Lessor’s rights, or estop the Lessor from exercising its rights, ……’

22. Mr Cole has drawn attention also to Clauses 19.3 and 19.4 which stipulate:

‘19.3 No failure by a party to enforce any provision of the rental contract shall constitute a waiver of such provision or affect in any way a party’s right to require performance of any such provision ……’

19.4 No agreement to vary, add to or cancel the rental contract shall be of any force or effect unless reduced to writing and signed by or on behalf of the parties to the rental contract.’

23. These provisions, Mr Cole submitted, negated the respondent’s arguments in relation to waiver and estoppel. I agree with his submissions. The provisions speak for themselves and expose the fallacious assumptions that permeate the arguments Mr Brooks presented on behalf of the respondent. The submission that the applicants delayed invoking their rights when the respondent breached the suspensive conditions, and in so doing tacitly waived compliance with the condition, has no legal substance.

24. There is similarly no merit in the argument that the applicants are estopped from relying on the respondent’s breach of the terms of the suspensive conditions as a ground for cancellation of the agreement. Mr Brooks submitted in this regard that the applicants had, after 30 June 2005, treated the agreement as having come into effect. This argument is legally flawed and ignores the provisions of clauses 16, 19.3 and 19.4 of the agreement.

25. The respondent has conceded that it failed to comply with either of the suspensive conditions. Thus, while the respondent has stated that it made efforts to secure a lease it does not deny that it failed to conclude ‘a lease agreement with the Buffalo City Municipality in respect of the immovable property at which the machinery is presently located’ as required in terms of the suspensive condition in clause 21.1 of the agreement.

26. The respondent has also admitted that the only member of the respondent who signed a deed of suretyship was Cornelius Johannes Wessel Thysse. In amplification hereof the respondent stated, inter alia, that 85% of the members’ interest in the respondent was owned by C J W Thysse and that the ‘other members of the close corporation are silent partners and not actively involved in the business’. The respondent added, however, that the other members would ‘have no objection to signing a deed of surety (sic).’

27. The reasons proffered by the respondent for its breach of the suspensive conditions manifestly do not establish any legal justification for its failure to comply with the said conditions. The respondent’s failure to comply was clearly a breach of the terms of the agreement and entitled the applicant to cancel the rental agreement.

Respondent’s alleged failure to properly maintain the machinery

28. Insofar as the respondent’s obligations to maintain the machinery are concerned the applicants refer to the following provisions in the agreement:

‘5. Lessee’s obligations

The lessee shall:

5.2 keep the machinery in its possession and under its care and control and shall take reasonable case in the use of the machinery;

5.4 ensure that the machinery is operated and used only by competent and properly trained, licenced (sic) and qualified persons and shall not permit the machinery to be used in contravention of any statute, ordinance, by laws or any other legislation in force during the currency of the rental contract. The Lessor will assist, when necessary and called upon to do so, to train new personnel to maintain the machinery;

5.5 …… This clause is inserted notwithstanding the fact that the Lessee has the responsibility, and bears the cost, of servicing and maintaining the machinery. The Lessor shall, prior to attending the premises for an inspection of the machinery, make an appointment for this purpose and any inspection is to be conducted in the presence of the On Site Manager and Mechanic or failing the presence of both of them, in the presence of at least one of them. Consent to the Lessor’s request for an inspection shall not be unreasonably withheld;

5.7 use the machinery with proper care and in a normal, proper and reasonable manner in accordance with any instructions and directions supplied by the Lessor, and the Lessee shall take all reasonable precautions to safeguard the machinery against any or all loss or damage;

5.14 perform at its own cost and daily maintenance checklist, if any, failing which the Lessee shall be liable to the Lessor in respect of any damage to or deterioration of the machinery caused by or pursuant to such failure.’

29. At the request of the applicants, John Swanepoel and Henk Vorster conducted inspections of the machinery. John Swanepoel is the first applicant’s brother and conducted an inspection of the machinery on 13 March 2006. The applicants have asserted that he has an intimate knowledge of the operational and maintenance requirements of the machinery. This assertion has not been disputed by the respondent.

30. Henk Vorster, a technician employed by Pan Mixers South Africa (Pty) Ltd, conducted an inspection of the machinery on 12 April 2006. In his case the applicants have asserted that he is an expert in respect of the machinery. The respondent has not disputed Mr Vorster’s qualifications as an expert save to deny that he ‘is the only expert in South Africa who can deal with machinery of this nature’.

31. In the affidavits, filed in support of the applicants’ founding affidavit, they have detailed in which respects the respondent failed to maintain the machinery properly. The reports of their inspections enumerate those parts of the machinery that are worn or defective and have to be repaired or replaced without delay to avoid further damage to the machinery. In a few instances they state that certain parts of the machinery are missing. The written reports are supplemented with photographs that display the relevant parts of the machinery dealt with in the reports.

32. The respondent has refuted the applicants’ allegations that the condition of the machinery has deteriorated due to a failure to maintain the machinery, as required in terms of the agreement. The respondent has also stated that subsequent to the inspections some of the worn and defective parts were repaired and/or replaced. Insofar as other worn or defective parts were concerned the respondent asserted that these would be attended to in June 2006 when the machinery was shutdown to enable routine maintenance to be carried out.

33. It is evident from the respondent’s version that repairs and maintenance were not undertaken in every instance as promptly as might have been expected. In paragraph 18 of the opposing affidavit C J W Thysse stated that, ‘The reason that the repairs and maintenance are not attended to immediately, is that in order for certain parts to be repaired, our plant shall have to be shutdown for hours or days at a time. It is financially not feasible for the plant to be shutdown as and when the parts require repairs, and therefore the shutdown is scheduled for a week during which all major repairs take place. Naturally, should the maintenance be urgent and if not done immediately result in the machine not operating properly or potentially cause damage to the machine, these repairs are attended to as and when they occur.’

34. The respondent’s averments regarding the maintenance of the machinery and the repairs that were effected, were premised, almost exclusively, on what had been stated by Collin Russell in his supporting affidavit. However, since the entire contents of the affidavit of Collin Russell have been struck out, the respondent’s averments are not substantiated by the person who, it claims, did the actual work.

35. The application to strike out has also resulted in crucial portions of Thysse’s affidavit and those of the affidavits of Darryl Lello and Albert Gehring (filed in supporting of the respondent’s opposing affidavit) being struck out. This has resulted in the respondent being placed in the invidious position that most of the applicants’ allegations, based on the reports of John Swanepoel and Henk Vorster, now stand unchallenged.

Conclusion

36. In my view, the respondent’s denial of various facts alleged by the applicants are not such as to raise a real, genuine or bona fide dispute of fact. See Room Hire Co (Pty) Ltd v Jeppe Mansions (Pty) Ltd 1949 (3) SA 1155 (T) at 1163 1165 and Plascon Evans Paints v Van Riebeeck Paints [1984] ZASCA 51; 1984 (3) SA 623 (A) at 634E I.

37. I am also of the view that the applicant’s factual averments are inherently credible and that the applicant’s version is to be preferred to that of the respondent. As I have stated previously the respondent has admitted various facts averred in the applicants’ affidavits. I am satisfied that these facts, together with the facts alleged by the respondent, justify the Court granting an order confirming the cancellation of the rental agreement by the applicants due to the respondent’s breach of various provisions thereof. See Plascon Evans Paints v Van Riebeeck Paints (supra) at 634H I.

Costs

38. Insofar as costs are concerned the rental agreement provides that costs incurred by the applicants in litigation should be on an attorney and own client scale. Mr Brooks has not made any submissions that negate those made by Mr Cole for costs to be granted on this scale.

Order

39. In the result, there is an order in the following terms:

(a) The applicants’ cancellation of the rental agreement in respect of the PMSA VB1X machine and related equipment is confirmed.

(b) The Respondent is ordered to hand over to the applicants the PMSA VB1X machine and related equipment.

(c) The respondent is to pay the costs of this application on an attorney and own client scale.

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Y EBRAHIM

JUDGE OF THE HIGH COURT 21 August 2006

Counsel for the applicants: Adv S H Cole

Attorneys for the applicants: Whitesides

GRAHAMSTOWN

Counsel for the respondent: Adv R W N Brooks

Attorneys for the respondent: Gray Madimutsira Inc

EAST LONDON

FORM A

FILING SHEET FOR EASTERN CAPE JUDGMENT

PARTIES: DOUGLAS RORY SWANEPOEL 1^st Applicant

SHARNÉ SWANEPOEL 2^nd Applicant

and

J T & T AGENCIES AND MAINTENANCE CC Respondent

• Registrar CASE NO: 1638/2006

• Magistrate:

• Supreme Court of Appeal/Constitutional Court:

DATE HEARD:

DATE DELIVERED:

JUDGE(S): EBRAHIM J

LEGAL REPRESENTATIVES -

Appearances:

• for the State/Plaintiff(s)/Applicant(s)/Appellant(s): Adv S H Cole

• for the accused/defendant(s)/respondent(s): Adv R W N Brooks

Instructing attorneys:

• Applicant(s)/Appellant(s): Whitesides

• Respondent(s)/Defendant(s): Gray Madimutsira Inc

CASE INFORMATION -

• Nature of proceedings :

• Topic:

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