JUDGMENT
HANNAH,
J.;
In this application the applicant seeks an order declaring a certain
agreement entered into by himself and the first respondent on 30th
August, 1994 to have been validly cancelled, an order requiring the
first respondent to remove all his property and livestock from the
land which is the subject of the agreement and an order for costs.
The
circumstances giving rise to the application are as follows. On 30th
August, 1994 the applicant and the first respondent (I will refer to
him as the respondent as the second respondent has taken no part in
the proceedings) entered into a written agreement whereby the
applicant agreed to buy, and the respondent agreed to purchase, a
section of approximately 2 100 hectares of farm Okatunde in the
district of Gobabis for an amount of N$205-00 per
hectare. The only clauses of the agreement which are of any real
relevance to the application are clauses 5, 8 and 9 and I will set
these out in full.
5.
POSSESSION
Possession
and vacant occupancy of the PROPERTY will be granted
to the BUYER on 1 December 1994, after which it will be at
the sole risk, profit or loss of the BUYER.
8.
OCCUPATIONAL RENT
Should
the date of occupation and possession not coincide with the date of
transfer, the party enjoying occupation and possession of the
PROPERTY, while it is registered in the name of the other party,
will pay occupational rent in the amount of N$l 500-00 per month, or
part thereof, to the other party quid
pro quo,
calculated from 1 December 1994 to date of registration of the
property in the name of the buyer.
9.
BREACH OF CONTRACT
Should
the BUYER fail to comply to any terms or conditions of this Deed of
Sale on the date of expiry, the SELLER or his agent reserves the
right to:-
(a)
cancel the sale by registered letter addressed to the BUYER,
whereafter the BUYER loses all amounts paid to the SELLER or his
agent, in terms hereof, without impairing the SELLER'S other rights
and remedies and the right to claim indemnification,
or
(b)
claim immediate payment of the selling price and demand compliance
of all the terms and conditions hereof."
The
agreement was written in the Afrikaans language and the clauses just
set out are taken from the English translation made by a sworn
translator annexed to the applicant's founding affidavit. Both
counsel for the applicant and counsel for the respondent are fluent
in both Afrikaans and
English
and during the hearing both attempted to indulge in some criticism
of the translation but as they were unable to agree I refused to
entertain the criticism. This country is no longer bilingual and
even if I were conversant with the Afrikaans language myself it
would not be permissible for me to compare the Afrikaans text with
the English text and depart from a translation by a sworn translator
without the agreement of the parties. It is equally impermissible
for counsel to give their personal views of the correctness of such
a translation unless they are agreed upon the matter.
Following
the conclusion of the agreement the respondent paid a deposit of
N$100 000 as provided for in the agreement and took possession of
the property. There then followed one or two minor disputes which I
find unnecessary to describe in detail. One concerned the removal of
certain game from the property and this, according to the
respondent, led to damage being caused to a boundary fence. The
respondent alleges that the applicant agreed to repair the fencing
but did not and eventually he repaired it himself at a cost of
approximately N$2 500-00. The applicant denies damaging the boundary
fence as alleged by the respondent but admits causing some damage to
inner fencing. He avers that following a request by the respondent
he instructed his workmen to repair the damage but before they could
complete the necessary work they were ordered off the property by
the respondent.
Whatever
the rights and wrongs may be concerning the fencing dispute it
is common ground between the parties that the respondent
sent a letter to the applicant dated 30th May, 1994 and it
is this letter which lies at the heart of the present
application. The letter was written in friendly terms and
begins:
"Dear
Johnny,
I
would like to bring several matters to your attention and I would
appreciate it if we could discuss them."
The
letter then continues by expressing the hope that the transfer of
the property had been concluded and mentioning a problem with one of
the border lines which would have to be attended to at some future
time. Then in the next paragraph the respondent states:-
"I
will however not pay occupational rent for May 1995, but will use
the money for the reparation of border and encampment fences,
damaged by the game catching process."
The
penultimate paragraph refers to a problem with one of the dams and
the letter concludes:-
"Johnny,
I would appreciate it if you would contact me in
order to sort out these matters.
Regards
Hermanus"
As
I have said, the letter was written in friendly enough terms but
that cannot be said for the reply. By letter dated 7th June, 1995
and sent by registered post the applicant's attorneys wrote
stating that they acted on behalf of the applicant and,
having referred to the contract of sale and in particular clause 8,
the letter continues:-
"Our
client furthermore instructed us that you have breached the contract
by refusing to pay the occupational rental for the month of May
1995, which refusal is contained in your letter to our client dated
30 May 1995.
As
a result of your abovementioned breach, our client is entitled to
cancel the contract, as stipulated in clause 9 thereof.
You
are hereby informed that our client herewith cancels the contract
with immediate effect and reserves his rights to take further legal
action against you as provided in the contract."
The
respondent did not accept the cancellation. Indeed on 6th June, 1995
the respondent paid the sum of N$l 500-00 directly into the
applicant's bank account. The applicant avers in his founding
affidavit that this payment was in respect of occupational rent for
June, 1995, but this is denied by the respondent. He alleges that it
was in respect of rental for May and sets out details of previous
payments made by him in support of this allegation. As counsel for
the applicant based part of one of his arguments on the dates of
these payments I will set them out. Rental for January, 1995 was
paid by cheque dated 28th January, that for February by cheque dated
2 8th February, that for March by cheque dated 31st March, that for
April by cheque dated 2nd May, that for May by cheque dated 6th June
paid directly into the applicant's bank account and that for June by
bank transfer made on 28th June. The applicant does not appear to
dispute the respondent's averment that it was agreed that rental
need not be paid for December, 1994.
Having
regard to the documents filed in support of the respondent's claim
that the payment made on 6th June was in respect of rental for May
and the failure of the applicant to deal with the documentary
evidence in his replying affidavit other than to make a bald denial
I accept that what the respondent states is correct. And I reject
the contention made by the applicant in his replying affidavit that
the respondent made the payment in question after he had been
apprised of the contents of the cancellation letter by the attorneys
responsible for the conveyancing and who received a faxed copy of
the letter on 7th June. This contention is based on an assertion
that the payment was made on 8th June, an assertion which is not
only at odds with the date on the deposit slip annexed to the
applicant's founding affidavit but is in conflict with what the
applicant expressly states in his founding affidavit. It may be that
by some other means the respondent got wind of the imminent
cancellation but that must remain speculation.
To
complete the history of this matter, the conveyancing attorneys
wrote to the applicant's attorneys by letter dated 12th June, 1995
stating that they had been consulted by the respondent on that day
but, in the circumstances, could act neither for him nor the
applicant. However, they placed on record that the respondent's
position was that he refused to accept the cancellation and if the
applicant persisted in stopping the transfer of the property he
should bring an application. This the applicant did on 5th July,
1995.
Mr
Heathcote appeared on behalf of the applicant and his
argument was essentially this. He submitted that clause 9 of the
agreement is a forfeiture clause which entitled the applicant to
cancel the agreement if the respondent failed to comply with any of
the terms or conditions including the condition requiring the
respondent to pay occupational rent in the amount of N$l 500-00 per
month. Counsel then pointed to the respondent's letter dated 30th
May, 1994 and his action in not paying rent for that month by the
end thereof and submitted that the respondent was clearly in breach
of the condition pertaining to payment of occupational rent. A
further submission made in the alternative was that by couching the
letter in the manner he did the respondent repudiated the agreement.
These submissions require close analysis.
The
first point to be considered is whether clause 8 required the
respondent to pay occupational rent at the end of each and every
month of his occupation pending transfer of the property into his
name, as Mr Heathcote submitted that it did, or whether the clause
only required occupational rent to be paid for the whole period of
occupation at the point in time when transfer of the property
actually took place, as Mr Coetzee submitted that it did. In support
of his submission Mr Heathcote relied on the fact that rent was paid
by the respondent on a monthly basis and in all instances, save two,
before the end of each month. It is obvious, said Mr Heathcote, that
the parties themselves accepted that rent was to be paid on a
monthly basis and this is as good a guide as any when deciding what
meaning should be given to the clause. But if that is not good
enough then Mr Heathcote submitted that it was an implied term of
the contract that the rent would become due and payable at the end
of each and every month and in support of this submission he relied
on the following passage in Cooper: South
African Law of Landlord and Tenant at
page 134:-
"In
the absence of agreement to the contrary, rent is payable on the
expiration of a lease or, if the lease is periodic, on the
expiration of each period, i.e. at the end of the day, week, month,
year, as the case may be, in which event it is said that rent is
payable in arrear."
Clause
8 of the agreement, as with the other clauses, falls to be
interpreted with a view to ascertaining the intention of the parties
having due regard to the words used in their proper contextual
setting, and to any permissible background circumstances: Total
South Africa (Pty) Ltd v Bekker N 0 1992
(1) SA 617 (A) at 624F. The clause is contained in a contract of
sale of land and it is clear from the opening words of the clause
that its purpose is to require the party occupying the land on and
after 1st December, 1994 to pay rent to the other party until such
time as the land becomes registered in the name of the buyer.
Although the purpose of the clause is not, therefore, to create a
lease but to compensate the party not in occupation on and after 1st
December, 1994 the position is, nevertheless, similar to that of a
lease for a fixed period.
The
clause stipulates the amount of rent to be paid, namely N$l 500-00
per
month, or part thereof, and it specifies the period during which
it is to be paid, namely from 1st
December,
1994 until the date the property is registered in the name of the
buyer. But it makes no express provision for when the rent is to be
paid during that period.
If
it can properly be said that this lacuna in the clause creates an
ambiguity it is permissible, in so far as it may be necessary, to
have regard to the subsequent conduct of the parties to establish
their common intention: MTK
Saaqmeule (Pty) Ltd v Killyman Estates (Pty) Ltd
198 0 (3) SA 1(a) at 12 F - H; Twenty
Seven Bellevue C C v.Hilcove
1994 (3) SA 108 (A) at 114 C. However, if the lacuna can be filled
by a term implied by law it becomes unnecessary to embark on such an
enquiry. As I have already said, the position in the present case is
similar to that of a lease for a fixed period where, in the absence
of agreement to the contrary, rent is payable after the lessor has
fulfilled his obligations, i.e. on the expiration of the lease:
Cooper
(supra)
at p. 134; Ebrahim,
N.O. v Hendricks
1975 (2) 78 (CPD) at 81 E. It is not, in my view, similar to a
periodic lease, as Mr Heathcote contended, because it is clear that
it was not the intention of the parties that the land would be
occupied periodically from month to month. The intention of the
parties was that the land would be occupied from one fixed point in
time to another. The sole purpose of reference being made to "month,
or part thereof" was to enable rent to be calculated. In my
view, therefore, it would be proper to hold that clause 8 included
an implied term that rent was payable at the end of the fixed
period, namely when the property was registered in the name of the
buyer. Viewed in this way there is no ambiguity in the
clause and it becomes unnecessary to have regard to evidence
indicating how the parties themselves may have understood the
contract, an exercise which is, in any event, often fraught with
pitfalls.
If
I am wrong in construing clause 8 in the manner just set out and the
rent was due and payable before the date when the property was
registered in the name of the buyer the fact remains that the clause
makes no provision for rent to be paid at any particular time. Mr
Coetzee submitted that in these circumstances rent was only
claimable by the applicant on demand and the applicant was not
entitled to cancel the contract before making such demand for
payment on or before a specified date, reasonable in the
circumstances. And that, it is common cause, the applicant did not
do. Having regard to cases such as Breytenbach
v Van Wijk,
1923 AD 541 I am of the view that there is merit in this submission
and it must be upheld.
Anticipating
the possibility that his first submission might be rejected Mr
Heathcote submitted in the alternative that by evincing an intention
in his letter dated 30th May, 1994 not to pay rent for the month of
May the respondent repudiated the agreement. Mr Heathcote submitted
that the respondent could not set-off the cost of repairing the
damage done to the fencing because the amount involved was an
unliquidated amount for damages and not a liquid claim. And in so
far as the relationship between the parties may be regarded as that
of landlord and tenant, giving the tenant the right in certain
circumstances to deduct the amount of repairs to the property from
rent, the alleged debt in the present case was not based on a legal
claim capable of prompt ascertainment. See Lester
Investments (Pty) Ltd v Narshi,
1951(2) SA 464 (C) at 469. Furthermore, the evidence suggests,
submitted counsel, that the repairs had not in fact been effected
and the sum of N$2 500-00 referred to in the respondent's answering
affidavit is only an estimate of the cost involved.
Mr
Coetzee advanced various arguments why Mr Heathcote's alternative
submission should be rejected. It will suffice if I deal with one
only. The most compelling argument advanced concerns the intention
of the respondent and whether his act in writing the letter dated
30th May to the respondent evinced an intention no longer to be
bound by the contract. In Re
Rubel Bronze and Metal Co and Vos
(1918) 1KB 315 McCardie, J said at p. 322:-
"The
doctrine of repudiation must of course be applied in a just and
reasonable manner. A dispute as to one or several minor provisions
in an elaborate contract or a refusal to act upon what is
subsequently held to be the proper interpretation of such provisions
should not as a rule be deemed to amount to repudiation. .. But, as
already indicated, a deliberate breach of a single provision in a
contract may under special circumstances, and particularly if the
provision be important, amount to a repudiation of the whole bargain
... In every case the question of repudiation must depend on the
character of the contract, the number and weight of the wrongful
acts or assertions, the intention indicated by such acts or words,
the deliberation or otherwise with which they are committed or
uttered, and the general circumstances of the case."
This
passage was cited with approval by Lewis, J in Schlinkmann
v Van der Walt and Others,
1947 (2) SA 900 (EDL) at p. 919 with the additional observation
that the onus of proving that the one party has repudiated the
contract is on the other party who asserts it. See also Van
Rooyen v Minister van Openbare Werke,
1978 (2) SA 835 (A) at 845.
What
is important to bear in mind in the present case is that the essence
of the agreement which it is alleged the respondent repudiated is
the sale and purchase of land and the payment of occupational rent
must be regarded as being only an ancillary matter. Compared to the
sale it was a relatively minor matter not at all vital to the
contract. See Estate
S Narhan v Estate W Grix.
1911 NPD 262. Further, the letter relied upon by the applicant
evinced an intention not to pay rent in respect of one month only
and not only gave a rational explanation for not doing so but left
the door open for discussion. In my opinion, when regard is had to
these factors and the general circumstances of the case the
applicant has come nowhere near establishing a deliberate and
unequivocal intention on the part of the respondent no longer to be
bound by the contract. Mr Heathcote's alternative submission must
therefore also be rej ected.
The
conclusions I have thus far reached are sufficient to dispose of the
application in favour of the respondent but one other matter was
argued by Mr Coetzee and I will deal with it, albeit briefly. Mr
Coetzee pointed to the fact that clause 9 of the agreement provides
that:-
"Should
the BUYER fail to comply to (sic) any terms or conditions of this
Deed of Sale on
the date of expiry,
the SELLER or his agent reserves the right to:-
(a)
cancel ..."
Mr
Coetzee submitted that effect must be given to the words "on
the date of expiry" which I have underlined and these words can
only mean that the applicant can only exercise his right to cancel
if at the date when the sale was due to be completed the respondent
was in breach of any terms or conditions.
The
opening words of clause 9 are either poorly drafted or badly
translated but whichever it be I must do the best I can to interpret
them. If the words "on the date of expiry" were to be
deleted the clause would make perfectly good sense and the position
would be that the applicant could exercise his right to cancel
whenever the respondent was in breach of a term or condition.
However, in construing a legal document the Court should incline
towards supposing that every word and every phrase is intended to
have some effect or to be of some use. This, of course, is a matter
of common-sense. At the outset I must therefore suppose that the
words in question were intended to alter the sense of the clause as
it would have been had the words not been included. The main
difficulty I have is in the use of the word "expiry". This
connotes at the end or termination of something rather than when
something is completed. However, although it would appear inexact
language was used it seems clear that the parties were intent upon
limiting the right to cancel to a breach which occurred
at the end of the transaction rather than at an earlier
stage. It may well be that what the parties had in mind were the
draconian consequences which would follow upon a cancellation for
say failure to pay one monthly instalment of rent on time, assuming
that my interpretation of clause 8 is wrong. If the words "on
the date of expiry" in clause 9 were to be ignored this would
result in the respondent forfeiting his deposit of N$100 000-00. For
the foregoing reasons Mr Coetzee's submission must be upheld. This
constitutes a further reason for refusing the relief sought.
In
the result the application is dismissed with costs.
Meinert v Biewenga and Another (A 7/96) [1996] NAHC 39 (19 January 1996);