SUMMARY (P) I 1462/2007

PAUL LOOTS v MARTIN SCHMIDT

FRANK, A.J.

28 July 2008

Owner – proof of ownership – huge movable object – would need crane and lowbed truck to remove from site – donated by owner in terms of written deed of donation – what kind of delivery sufficient to transfer ownership – raft towed to specific area and tied with rope to pillar – survey done on raft by divers at request of person towing it – having regard to nature and type of use of raft possession of raft was taken by actions aforesaid – delivery thus brevi manu.

Contract – deed of donation – terms and conditions – raft donated “on the conditions of this agreement” – donee undertook to remove raft within 90 days – removal of raft within time period not a condition in the true sense of the word but a term of the agreement – failure to remove within stipulated term thus not terminated donation.

CASE NO. (P) I 1462/07

IN THE HIGH COURT OF NAMIBIA

In the matter between:

PAUL LOOTS PLAINTIFF

and

MARTIN SCHMIDT DEFENDANT

CORAM: FRANK, A.J.

Heard on: 2008.07.10

Delivered on: 2008.07.28

_______________________________________________________________

JUDGMENT

FRANK, A.J.: [1] This is a trial action in which the plaintiff claims what is referred to as “an Aqua Cruiser Raft” (the raft) in the pleadings from defendant. Plaintiff’s claim is based on him being the owner of the raft. He avers that he became owner as it was donated to him by the Namibia Development Corporation (NDC) in terms of a written deed of donation. Defendant denied that plaintiff is the owner of the raft and avers it was not owned by the NDC, which entity in any event did not have the authority to donate it to plaintiff. Defendant further avers that plaintiff did not accept the donation, did not fulfil the condition of removing the raft within 90 days and in any event did not take possession of the raft. Finally, defendant avers that he is the owner as the raft was res derelicta and he took possession thereof with the intention to become the owner and hence became the owner.

[2] Defendant instituted a conditional counterclaim premised on the basis of the Court finding he is not the owner for certain repairs and improvements affected by him to the raft as possessor.

[3] At the commencement of the trial the parties agreed hat the question of ownership be determined ab initio and depending on this Court’s finding in this regard the matter to be finalised or to continue on the averments relating to the alleged salvaging, repairing and improving of the raft. Indeed a written stated case was presented but as plaintiff wanted to establish further facts the plaintiff was called as a witness. Mr Coleman, who appeared for the defendant, confirmed that the facts agreed to in the document handed in remaind so agreed. It needs to be mentioned that apart from plaintiffs evidence no other witnesses were called by either of the parties and the facts are thus to be gleaned from the evidence of the plaintiff and the document containing the agreed facts. I thus now turn to state the facts placed before Court.

[4] After heavy rains in the catchment area of the Von Bach dam plaintiff and a certain Mr Howard noticed the raft where it had washed ashore an island in the dam. They utilised their motorised boats to tow the raft from the island to a place on the shore of the dam. This occurred during November 2005. Even at this early stage plaintiff indicated to Mr Howard that he was interested in acquiring the raft for himself. At that stage Mr Howard indicated that he would like to become a partner of plaintiff in this quest. This partnership never materialised. Plaintiff tied the raft with a rope to some nearby pillars where a restaurant used to be.

[5] The Von Bach dam is situated on State land falling under the control and supervision of the Ministry of Environment and Tourism (the Ministry). The public has access to the dam which is used by boating enthusiasts.

[6] The raft is a substantial structure. Thus to have removed it one would have to use a cane to lift it on to a lowbed truck. Once this was done one would not have been able to get it through the motor gate granting access to the existing road. Thus if one wanted to use the existing road and gate it meant that one would have to dismantle the raft and transport it in pieces.

[7] Subsequent to moving the raft on to the shore of the dam plaintiff went to the trouble to ascertain who the owner of the raft was which enquiries led him to the NDC. He also acquired the services of two drivers to inspect the raft for him as it became submerged there where he and Mr Howard had left it when the water level of the dam rose after further inflows. For the divers to do their inspection the plaintiff had to buy certain helium cylinders with a pressure gage. He furthermore consulted a further two persons as to the repairs to be made to the raft.

[8] On 23 March 2006, after certain internal processes in the NDC, a written “Deed of Donation” was entered into between plaintiff and the NDC. In terms of this “Deed of Donation” the raft was donated to plaintiff who accepted the donation “on the conditions of this agreement. Loots (plaintiff) undertakes to remove the Aqua Cruiser (Rafter) as soon as possible and in any event within 90 days from date hereof”.

[9] I do not intend to quote the whole agreement save to state that it also provided that the risk in the raft would pass to plaintiff and that plaintiff had to carry the costs of removing it from the dam and had to obtain all the necessary consents in this regard.

[10] Armed with this agreement the plaintiff approached the Ministry so as to take up the matter as to how to further deal with the raft. Initially the officials of the Ministry could not assist but eventually he was advised to approach the Permanent Secretary, a Dr Malan Lindeque.

[11] Per letter dated 9 May 2006 addressed to Dr Lindeque plaintiff made a request to remove the raft from the dam. In this letter he requested permission to repair it on site on the shore of the dam as it was “to big to take it to a town” and informed Dr Lindeque that he intended to refloat it after being repaired for his personal use. Per letter dated 22 August 2005 (I assume this should be 2006 as this is also indicated as the year on the date stamp used and does seem to be a response to plaintiff’s request) the Ministry authorised plaintiff to remove the raft from the dam and “away from the premises of the Von Bach Recreational Resort” within a month and on certain other conditions. Plaintiff responded to the Ministry by letter dated 28 August 2006 pointing out that in his earlier letter he requested permission to do repairs on the raft “on the side of the dam” and if he had to remove the raft from the premises the donation might not have been worthwhile. He also pointed out that the existing gates were too small to allow the removal of the raft.

[12] It would appear that there was no response to the plaintiff’s letter of 28 August 2006 and that plaintiff also did not do anything further in this regard as no evidence was led or facts agreed to as to what happened after 28 August 2006 until December 2006 when defendant according to the pleadings took possession of the raft.

[13] Mr Coleman made two submissions in respect of plaintiff’s claim to ownership. Firstly, that the deed of donation was conditional upon plaintiff removing the raft within 90 days and as this was not done ownership did not pass to plaintiff. Secondly, that the raft was not delivered to plaintiff in the legal sense of the word and hence, whatever personal rights plaintiff might have had flowing from the Deed of Donation against the NDC, ownership did not pass from the NDC to plaintiff.

[14] I interpose here to mention that certain other defences to plaintiff’s claim to ownership were raised in defendant’s plea. Mr Coleman did not rely on any of them and in my view correctly so. It thus do not deal with them but only with the submissions by Mr Coleman as stated above.

[15] Mr Strydom who appeared for the plaintiff in reply to the submissions by Mr Coleman made the following submissions. Firstly, the stipulation pertaining to the removal of the raft within 90 days was not a condition but a mere term of the agreement and hence non-compliance therewith did not lead to the termination of the Deed of Donation. Secondly, that delivery was in fictional form of brevi manu in that plaintiff was already in possession of the raft and the Deed of Donation was evidence of the fact that he would henceforth possess the raft with the intention of being the owner thereof. The Deed of Donation (agreement) under the heading “Donation” states the following:

“The NDC donates the Aqua Cruiser (raft) to Loots who hereby accepts the donation on the conditions of this agreement. Loots undertakes to remove the Aqua Cruiser (rafter) as soon as possible and in any event within 90 days hereof”.

[16] The agreement further provided for the following:- The risk to pass upon signature of the agreement. An indemnity to NDC “as a result of taking ownership of the …(raft), removing same from Von Bach Dam…”. Plaintiff had to carry all costs in removing the raft from the dam and had to obtain all the necessary consents for such removal.

[17] As a starting point I refer to an extract from the Katz case¹ which succinctly sets out the difference between a term of a contract and a condition and also refer to the fact that the word “condition” is often (wrongly) used to refer to the provisions of an agreement.

“The word ‘condition’ in relation to a contract, is sometimes used in a wide sense as meaning a provision of the contract, ie an accepted stipulation, as for example in the phrase ‘conditions of sale’. In this sense the word includes ordinary arrangements as to time and manner of delivery and of payment of the purchase price, etc in other words the so called accidentalia of the contract. In the sense of a true suspensive or resolutive condition, however, the word has a much more limited meaning, viz of a qualification which renders the operation and consequences of the whole contract dependent upon an uncertain event…In the case of true conditions the parties by specific agreement introduce contingency as to the existence or otherwise of the contract, whereas provisions which are not true conditions bind the parties as to their fulfilment and on breach give rise to ordinary contractual remedies of a compensatory nature, ie (depending on the circumstances) specific performance, damages, cancellation or certain combinations of these.”

[18] In the same vein I also refer to the following extract from the Ogus case²:

“Stipulations or provisions in a contract dealing with terms of performance are often loosely referred to as conditions, but they are not conditions in the narrow legal sense of the word, but merely terms of the contract. A condition affects the existence of an obligation and a term the nature of the obligation. A condition determines whether there is a contract or not and therefore whether there is liability or not, while a term does not relate to the existence of the contract or obligation but simply regulates or modifies the obligations of the parties to the concluded contract. A condition is either fulfilled or not, according to whether a prescribed event does or does not take place. If the condition is fulfilled, it has an automatic effect, either creating or cancelling a contractual obligation. The fulfilment of a condition cannot be enforced. A term, on the other hand, imposes an obligation upon the party or parties concerned to make certain performances. If such party does not make the performance as prescribed by the term, the other party has an action for enforcement of the obligation, or for damages for breach of the term.”

[19] In my view the reference to “on the conditions of this agreement” was a reference in general to the stipulations or provisions of the agreement and not a reference to conditions in the true sense of the word, i.e making the contract subject to certain contingencies. The agreement is entered into “on the conditions” and not subject to the conditions. The 90 day period is recorded as an undertaking by the plaintiff and not a condition and hence is, on the face thereof, nothing other than a time clause and thus a term of the agreement. This was to safeguard the NDC against incurring costs to remove the raft itself which is stipulated to be for the plaintiff’s account. Furthermore it was intended for the risk and ownership to pass immediately as it was clearly contemplated that plaintiff would become owner and thereafter remove the raft. (“…taking ownership of the …(raft), removing same…”). The removal was not something out of the control of the parties to the agreement and (apart from consent as to the manner of removing it from the dam premises) subject to the will or actions of a third party³. The obligation or undertaking by plaintiff was enforceable.

[20] For the aforegoing reasons I am of the view that the agreement was not conditional on plaintiff removing the raft within 90 days but that this time period was a stipulation, provision or term of the agreement. It thus follows that the non-compliance with the mentioned time period had no effect on the validity of the agreement and Mr Coleman’s submission to the contrary is accordingly dismissed.

[21] As far as the question as to whether delivery of the raft was effected is concerned I’ve stated the contentions advanced on behalf of the parties above and I now turn to deal with this aspect. It must be noted at the outset that if plaintiff can establish that ownership passed to him at any stage the fact that there is no evidence that plaintiff did anything with regard to the raft after the exchange of letters already referred to he could not have lost it though inaction. This is so because ownership, unlike possession, is not lost by the failure to remain in physical control.

[22] Mr Coleman pointed out that the agreement in itself cannot have the effect of ownership passing and that a form of delivery had to be established for ownership to pass. This is correct. What the agreement however makes clear is that the parties intended ownership to pass from the NDC to plaintiff.

[23] Delivery brevi manu occurs where a person is already in possession of a movable and by agreement with the owner he then becomes the owner thereof. A typical example would be where a lessee of a movable is donated that movable by the owner. As the donee was already in possession of the thing donated no further delivery is needed and ownership passes as soon as the parties have the requisite intention to transfer and acquire ownership. As already mentioned this is the form of delivery contended for on behalf of plaintiff. Mr Strydom submitted that plaintiff was already in possession of the raft when the agreement was entered into and as the agreement clearly stipulated the intention of the parties to transfer ownership it had the effect of a delivery brevi manu and as a result ownership passed to the plaintiff.

[24] Mr Coleman submitted that the control that plaintiff exercised in respect of the raft did not amount to possession. In this regard he referred, inter alia, to the case of Reck v Mills⁴ where the fastening of a rope with an attached buoy to a part of a shipwreck was not accepted as signifying sufficient direct physical control. He in his argument likened what plaintiff did to leaving a box of wine with a mark on it on a busy street corner.

[25] The example of the box of wine is in my view not helpful. It ignores completely the different natures and types of use between the wine and the raft. As already pointed out the raft was a large item which cold not be removed at will but would entail the use of a crane and a lowbed as well as leave from the owner of the land to either break down and re-erect the gate or to follow a route where there was no existing road and the concomitant disrupture. The raft can only be used on water.

[26] Because of the size of the raft the only practical way to take physical control of it was to tow it to a specific place on or near the bank of the dam and secure it there. There was no question of a passing person simply taking it with him or her. The plaintiff towed it to such a place and tied it with a rope to a pillar. This means it should have been obvious to anyone that someone is laying claim to the raft otherwise why tie it with a rope to a pillar. Furthermore the size of the raft must have raised doubts in any person’s mind as to whether anyone would abandon it. The type of use to which the raft could be put was also such that one would have expected to find it at the dam. From the nature of the raft and the type of use it could be put to anyone should have realised that it was not likely to be abandoned and furthermore that it’s owner or possessor would not exercise continuous physical control over it but would do so sporadically or intermittently. It must be borne in mind that it is a single object and not like a sunken vessel which potentially had many items (freight) on board which is separate from the vessel. This intermittent physical control could be resumed at any stage as the raft was present in a public place from where it would be practically impossible to remove it on the spur of the moment and there was nothing to prevent plaintiff from accessing it as is evident from his use of divers already referred to.

[27] For the above reasons I am of the view that the plaintiff did have sufficient possession of the raft for the purposes of delivery brevi manu and he thus became the owner of the raft upon entering into the agreement with the NDC.

[28] The result is that I find that plaintiff did establish that he is the owner of the raft and in accordance with the parties’ agreement in dealing separately with this issue I order that the costs occasioned by adjudicating this issue separately to be paid by the defendant.

FRANK, A.J.

ON BEHALF OF PLAINTIFF ADV. JAN STRYDOM

Instructed by: ENGLING, STRITTER & PARTNERS

ON BEHALF OF DEFENDANT ADV G COLEMAN

Instructed by: CHRIS BRANDT ATTORNEYS