This
is an appeal from a judgment of the High Court given on 9 March 2006
dismissing with costs an application for an order compelling the
first respondent to transfer Stand 151 of Plot 216 of Good Hope
Township of Good Hope into the appellant's name in terms of an
agreement of sale entered into between the appellant and the late
Robert Mubayiwa Marere on 30 October 1998.
The
appellant and the late Robert Mubayiwa Marere (“the deceased”)
entered into a written contract on 30 October 1998 in terms of which
the latter agreed to sell and the former agreed to purchase Stand 151
of Plot 216 of Good Hope Township of Good Hope (“the property”)
for $230,000=.
The
parties provided for two alternative methods of payment of the
purchase price under Clauses 12 and 7. Under Clause 12, they agreed
that the purchase price would be paid as follows:
“1.
The sum of $50,000= (fifty thousand dollars) to be paid to ERS
REALTY'S TRUST ACCOUNT on signing of this Agreement of Sale.
2.
The balance of $180,000= (one hundred and eighty thousand dollars) to
be paid at the rate of $30,000= (thirty thousand dollars) per month
commencing on the 1st of July 1998 with interest at the rate of 25%
effected if the purchaser does not meet the deadline of 30 December
1998.”
Under
Clause 7, headed “TRANSFER”, the parties agreed that:
“Transfer
shall be effected by the seller's conveyancers and the purchaser
shall, within a period of fourteen days, pay or furnish a Bank or
Building Society guarantee for payment of the purchase price against
transfer. If such payment or guarantee shall not be furnished to the
seller's conveyancers the purchase price shall bear interest at 19%
per annum from the expiry of such period of fourteen (14) days until
transfer shall be effected.”
The
details of payment provided for under Clause 7 are so different from
those under Clause 12 that an inference must be drawn, as a matter of
construction from the terms used, that the parties intended that the
appellant would have to decide which of the two methods of payment to
follow and be bound by the terms.
Under
Clause 10, the parties agreed that in the event of the purchaser
failing to pay any sum owing under the agreement on the due date or
in the event of any breach of any other condition of the agreement,
the seller had to give the purchaser written notice to remedy the
breach within fourteen days of the posting of such notice failing
which the seller would be entitled to cancel and terminate the
agreement of sale, or, alternatively, have the option to institute
legal proceedings against the purchaser for the balance of the
purchase price then owing under the agreement.
Lastly,
they agreed, under Clause 11, that the agreement of sale constituted
the entire contract between them and no variation of it would be
valid unless reduced to writing and signed by or on behalf of the
parties.
No
payment of the sum of $50,000 was made by the appellant on signing of
the agreement on 30 October 1998 in terms of Clause 12(1) of the
contract. An amount of $50,000 had been paid to ERS Realty on 21 May
1998. The receipt states that the money was paid as a deposit of the
purchase price in respect of Stand 21G of Lot 216 of Good Hope
Township.
Counsel
for the appellant argued, on appeal, that Stand 21G of Lot 216 was in
fact the same as Stand 151 of Lot 216 of Good Hope Township.
Whilst
that may be the case there was nothing said by the appellant in the
founding affidavit to support the contention. Similarly, the founding
affidavit was silent as to whether Stand 21G of Lot 216
of Good Hope Township in respect of the purchase price of which an
instalment of $3,000 was paid to ERS Realty on 31 July 1998 was the
same as Stand 151 of Lot 216 of Good Hope Township.
Five
receipts of payments of $30,000 made by the appellant to Messrs
Manase & Manase, a firm of legal practitioners appointed as the
seller's conveyancers, were annexed to the founding affidavit. The
payments were all made between 31 March and 12 October 1999. Each
receipt states that the payment was a deposit for a purchase price
for an unidentified piece of land. The payment is said to be to the
credit of an entity called NYIKA Engineering.
Counsel
for the appellant suggested, in argument on appeal, that NYIKA
Engineering was a company owned by the deceased.
There
was no reference to NYIKA Engineering in the founding affidavit.
Even
if it is a company there was no explanation given as to why it
received payment of the money in terms of a contract to which it was
not a party.
The
respondent, who became the executrix dative on 24 October 2003 in her
husband's estate, denied that the estate received any of the sums
of money paid by the appellant to ERS Realty and Messrs Manase &
Manase for the property. She denied knowledge of any relationship
between NYIKA Engineering and the deceased in his lifetime. She went
on to aver, in paragraph 2 of the opposing affidavit that:
“It
is also telling that the applicant has not been able to take vacant
possession of the said Stand since 1998 and has not claimed it until
well after my husband's death and has not sought to enforce his
rights to take transfer. This is so because my husband repeatedly
informed him that he had not received the purchase price. It is
therefore apparent that the applicant knows of the problems
associated with this sale and wishes to take his chances with me.”
The
court a quo held that payment of the instalments of $30,000= per
month to Messrs Manase & Manase constituted a breach of Clause
12(2) of the Agreement of Sale as the appellant was bound to pay the
money to ERS Realty. As a result, the application was dismissed with
costs.
The
contention, on appeal, was that the learned Judge misdirected herself
in making the finding that the payment of the instalments to Messrs
Manase & Manase was in breach of Clause 12(2) of the agreement of
sale. It was argued, in the alternative, that even if the payment was
a breach of contract, the learned Judge ought not to have dismissed
the application because the deceased or the first respondent had not
initiated and completed the procedure agreed on by the parties under
Clause 10 of the agreement of sale for termination of the contract.
To
determine the correctness of the contention that the court a quo
misdirected itself in holding that payment to Messrs Manase &
Manase was in breach of Clause 12(2) it is necessary to decide the
question as to which of the two methods of payment of the purchase
price the appellant was found to have decided to follow.
It
is clear that the learned Judge took the view that he followed the
method of payment provided for under Clause 12 of the contract.
Counsel for the appellant argued that the payments of the instalments
were made in terms of Clause 7 of the agreement of sale.
The
fact that there was in fact no payment of the deposit of $50,000 on
signing of the agreement of sale on 30 October 1998 in terms of
Clause 12(1) of the contract would suggest that the appellant decided
to pay the purchase price in terms of Clause 7. It is, however, clear
from the facts of the case that although the payment of $50,000 to
ERS Realty by the appellant on 21 May 1998 was, at law, not payment
in terms of
the agreement of sale, he believed that it was payment towards the
purchase price of the property.
Although
he produced no evidence to support the allegation, the appellant had
his case argued on the basis that Stand 21G of Lot 216 of Good Hope
Township for the purchase price of which $50,000 was paid was in fact
Stand 151 of Lot 216 of Good Hope Township.
The
learned Judge was correct in finding, on the facts, that the
appellant believed he had made the payments in terms of Clause 12 of
the agreement of sale. I, however, do not agree with the finding by
the learned Judge that if the payment to Messrs Manase & Manase
was indeed in respect of Stand 151 of Lot 216 of Good Hope Township
it was in breach of Clause 12(2) because it ought to have been made
to ERS Realty.
The
appellant was specifically required, under Clause 12(1) of the
agreement of sale, to pay $50,000 of the purchase price to ERS Realty
on signing of the contract. That exclusive mandate did not extend to
the payment of the balance of $180,000. Clause 12(2), relating to the
payment of the balance, is silent as to whom the payment was to be
made. It therefore had to be made to the deceased.
Payment
of the instalments of the purchase price to Messrs Manase &
Manase, in terms of clause 12(2) of the agreement, would not be in
breach of the contract provided the appellant made sure that the
deceased received the money.
It
is clear from the facts that the appellant failed to prove that the
payments he made were in terms of the contract. He failed to show
that there was payment of $50,000 to ERS Realty on signing of the
agreement. There was no term in the agreement of sale by which the
parties acknowledged payment of $50,000 before the signing of the
contract. There was no evidence at all in the papers to show that the
deceased received any of the payments made either to ERS Realty
before the signing of the agreement of sale or to Messrs Manase &
Manase after the signing of it.
The
first respondent denied that the deceased received any of the
payments. All that the appellant could say in the answering affidavit
was that the question whether the deceased received the money in
terms of the contract was not for him to answer.
The
appellant chose to proceed by way of a court application to claim the
order of specific performance against the first respondent. As the
proceedings were by way of a court application and there were
disputes of fact the final relief could only have been granted if the
facts stated by the first respondent together with the admitted facts
in the appellant's affidavit justified such an order. Plascon Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A) …,.
As
the court a quo was not satisfied as to the inherent credibility of
the factual averments in the appellant's affidavit and the first
respondent's denial not found to have been patently false it
correctly held that it could not grant the order sought.
The
appellant had applied for an order of specific performance of the
deceased's contractual obligation to transfer the property into his
name by the first respondent.
That
a party to a contract has, in an appropriate case, a right to claim
specific performance is not in doubt. In Shakinovsky v Lawson &
Smulowitz 1904 TS 326 INNES CJ said…,:
“Now,
a plaintiff has always the right to claim specific performance of a
contract which the defendant has refused to carry out, but it is in
the discretion of the court either to grant such an order or not.”
See
also Farmers Co-operative Society (Reg) v Berry 1912 AD 319…,.;
Haynes v Kingwilliamstown 1951 (2) SA 371 (A)…,.; Industrial &
Mercantile v Anastassiou Bros 1973 (2) SA 601…,.; Ranch
International Pipelines (Pvt) Ltd v LMG Construction (City) (Pvt) Ltd
1984 (3) SA 861…,.; Minister of Public Construction v Zescon (Pvt)
Ltd 1989 (2) ZLR 311 (S)…,.
The
right to claim specific performance of a contract by the other party
is premised on the principle that the appellant must first show that
he has performed all his obligations under the contract or that he is
ready, able, and willing to perform his own side of the bargain.
WESSELS,
The Law of Contract in South Africa, Vol 11…, states that:
“The
court will not decree specific performance where the plaintiff has
himself broken the contract or made a material default in the
performance on his part (Lawson, s. 472, p.522).
A
plaintiff is not entitled to succeed against a defendant in an action
for breach of contract unless he can show that he has performed his
part or is ready to do so; and, therefore, he cannot ask for specific
performance unless he has either performed his part of the contract
or unless he has been prevented from doing so by the defendant.”
See
also Wolpert v Steenkamp 1917 AD 493…,.
The
effect of the finding by the court a quo was that the appellant
failed to show that he had fulfilled his own obligations under the
contract. The view I have taken of the facts is also that the
appellant failed to show on the papers that he had paid the purchase
price of the property in terms of the agreement of sale. There was
no payment of the sum of $50,000 on signing of the agreement of sale.
There was no proof that the monies paid to Messrs Manase & Manase
were received by the deceased.
Even
if these sums
of money could have been paid to the credit of the deceased, they
were paid after the date the appellant would have been bound under
Clause 12(2) of the agreement of sale to complete the purchase of the
property. The interest which would have been due and owing would not
have been paid.
The
appellant did not tender any payment to show that he was ready, able,
and willing to fulfil his own obligations under the contract. By his
own conduct, the appellant dis-entitled himself to claim specific
performance of the contract by the first respondent.
The
appeal is accordingly dismissed with costs.
