The
brief facts of this matter are that the applicant is a former
employee of J W Jaggers Wholesalers (Pvt) Ltd (herein after referred
to as Jaggers).
J
W Jaggers Wholesalers (Pvt) Ltd (Jaggers)
was placed under liquidation.
As
an employment benefit. the applicant was offered tenancy of Number
8 Prices Road, Emerald Hill, Harare at
subsidised rates. He was still residing in the house at the time of
liquidation. The first respondent, as liquidator of J W Jaggers
Wholesalers (Pvt) Ltd went about disposing off J
W Jaggers Wholesalers (Pvt) Ltd
assets
- including the property in question. Ultimately, the property was
sold to the second respondent who has since taken transfer and
occupation of the property. The applicant, as a sitting tenant,
complained that the first respondent breached his rights by failing
to accord him the right of first refusal. He believed, as a sitting
tenant, he had the right of first refusal. On 5 March 2013, a letter
was written to the applicant advising him that the property was up
for sale. The asking price was US$140,000=. It read;
“As
a sitting tenant you are hereby offered the right to make your offer
for the same should you be interested. Kindly urgently let us know of
your position but not later than 5 days of this letter.”
On
7 March 2013, the applicant wrote to the first respondent as follows;
“Consider
Real Estate have approached me advising me of the sale of the above
stated house where I reside for $140,000=. I intend to use my share
from liquidation towards the above house purchase.”
He
requested to know how much he would be getting from proceeds of
liquidation so as to make an offer to the Estate Agent.
On
12 March 2013, a letter was written on the applicant's behalf by
Quic Quick Systems. The applicant termed such letter a guarantee
letter which he termed an acceptable offer to purchase the said
property. The letter read;
“RE:
LOT 71 MOUNT PLEASANT/ 8 PRICE ROAD, EMARALD $150,000 GUARANTEE FOR
MISHCEK MUZA
We
write to guarantee the balance of the above amount after set offs for
Mr Misheck Muza towards his proposed scheme towards landing that
property under liquidation. Mr Muza came through to us and we are
undertaking, under our terms and conditions, to make available the
amount he needs so that he gets the above residential property where
he has been living as a long-time Jaggers employee but now under
liquidation…,.
Signed”
The
applicant argued that the above letter constitutes an offer and such
offer was made within the 5 days provided by the first respondent.
It
is correct that the said letter was written within the 5 days
provided. The only issue for determination is whether such a letter
constitutes an offer.
Firstly,
what the applicant was called upon to do was clear. The applicant was
advised that an offer for the property had been made for $140,000=.
The applicant was invited to make an offer of $140,000= for the
property.
VAN
DER MERWE, VAN HUYSSTEEN, REINECKE and LUBBER in their book Contract:
General
Principle, defines on offer as follows;
“An
offer is an expression of will, made with the intention of creating
an obligatory relationship on certain or ascertainable terms with
another, and brought to the attention of the addressee, so as to
enable him to establish a contract by accepting the offer as it was
made. See Bourbon-Leftley v WPK (Londboul Bpk 1999 (1) SA 902 C;
Ideal Fastener Corporation CC v Book Vision (Pty) Ltd t/a Colour,
Curaphic 2001 (3) SA 1028 (D)…,.”
LENY
J in Wasmuth v Jacobs 1987 (3) SA 629 (SWA)…, had this to say on
offers;
“The
rules applicable to the interpretation of an offer, or…, are not
necessarily the same as the rules which are applicable in the
interpretation of contracts. In Borene v Harris 1949 (1) SA 793 (A)
at 799, after stating the aforesaid position, GREENBERG JA added:
'Thus,
although a contract, even if it be ambiguous, may be and generally is
binding,…, the offer itself must be unequivocal, i.e. positive and
unambiguous.'”
An
offer ought to be definite and complete. If there is no certainty in
what was promised or offered and when it was to be fulfilled –
there can be no valid offer. See Nestows v Innscor Africa Ltd 2007
(20) ZLR 267 (H).
Applying
the above principles to the letter of 12 March 2013, from Quic Quick
Systems, it is clear there could have been no valid offer. The letter
is not clear as to how much, in terms of price, the applicant was
offering for the property. The applicant also spoke of a set-off. It
is not clear how much the set off was.
I
am satisfied that that letter did not constitute an offer.
On
17 May 2013, the first respondent's lawyers advised that the
property had been sold. The applicant, in that letter, was given
three (3) months notice to vacate the premises. The applicant then
filed an urgent chamber application seeking to stop the sale. This
court refused to hear the matter on an urgent basis as it had the
impression that the applicant had not proved the right of first
refusal on the papers filed.
The
applicant then filed this application on the ordinary roll.
The
right to first refusal was explained in the case of Eastview Gardens
Residents Association v Zimbabwe Reinsurance Corporation Ltd and
Others SC30/62 when MALABA JA…, said;
“A
right of first refusal or pre-emption is created when in an agreement
one party (the grantor) undertakes that when he decides to sell his
property he will give the other party (the grantee) the opportunity
of refusing or buying the property at a price equal to that offered
by another person. The grantor is then said to be under an obligation
to do, at the time he sells the property, what he voluntarily bound
himself to do, that is, offer the property to the grantee first at a
price equal to that offered by a third party or which he is prepared
to accept from any other would-be buyer. The grantee is said to have
acquired the correlative right to have the property offered to match
the price offered by the third party or refuse the offer.”
He
cited the case of Manchester Ship Canal Company (1901) 2 [Chapter
37]…,; Sher v Allan 1929 OPD 137; and Madan v Macedo Heirs and
Another 1991 (1) ZLR 295 (S).
The
right of first refusal can therefore only be said to emanate from an
agreement. The applicant had the onus to prove the existence of such
right.
Let
me now proceed to determine whether the applicant managed to prove
that he had the right of first refusal.
As
l reiterated above, the right of first refusal is created through
contract or agreement. The applicant has not produced any contract
showing the existence of the right. l am of the view that the
applicant mistakenly believed that the mere fact that he was a
sitting tenant entitled him to a right of first refusal. Being a
sitting tenant does not automatically confer upon the tenant the
right to his first refusal. There existed no such agreement between
the applicant and J
W Jaggers Wholesalers (Pvt) Ltd.
That
brings me to the letter of 5 March 2013. That letter, in my view, did
not give the applicant the right of first refusal. What that letter
did was to give the applicant the right to make an offer to purchase
the property at a price of $140,000=. For an agreement to be reached,
the applicant was supposed to make the offer which was to be accepted
by the first respondent. From the evidence supplied by the applicant
no such offer was made. Instead, the applicant sought to inquire,
from the first respondent, the amount he would get from liquidation.
Once he had such information he was going to make an offer.
For
an offer to be valid it must be clear and unambiguous.
The
letter by the applicant of the 7th
of March 2013 did not represent an offer in law. Therefore there was
no agreement reached between the parties. See also Hativagone and
Another v CAG Farms (Pvt) Ltd and Ors SC42-15.
In
the present case, an agreement would have been concluded upon
presentation of set-off figures to the applicant. No such figures
were presented by the first respondent. Unless and until the
outstanding issue of what was due to the applicant from J
W Jaggers Wholesalers (Pvt) Ltd was
settled – there was no consensus between the parties.
See
also Premier, Free State v Firechem Free State (Pvt) Ltd 2000 (4) SA
413 (SCA); Namibian Minerals Corporation Ltd v Benguela Concessions
Ltd 1997 (2) SA 548 (A); CGEE Alshthom Equipments et Enterprises
South African Division v GNK Sankey (Pvt) Ltd 1987 (1) SA 81 (A)…,
where COOBELT JA said;
“Whether
in a particular case the initial agreement acquires contractual force
or not depends upon the intention of the parties, which is to be
gathered from their conduct, the terms of the agreement, and the
surrounding circumstances.”
Looking
at documents supplied, the conduct of the parties, and the
surrounding circumstances, it is clear that no right of first refusal
existed. Even after the applicant was given an opportunity to offer
to purchase the property, no such offer was made. No acceptance was
done by the first respondent. The house was subsequently sold to
someone else.
I
am satisfied that the applicant has failed to discharge the onus on
him of proving the existence a right of first refusal. The applicant
has failed to show that he had a clear right and l am unable to grant
the interdict sought.
Accordingly,
it is ordered that; the application is dismissed with costs.
