Case Law[2022] ZAGPJHC 726South Africa
Ensemble Hotel Holdings Proprietary Limited v Gunzenhauser and Another (2021/10258) [2022] ZAGPJHC 726 (28 September 2022)
High Court of South Africa (Gauteng Division, Johannesburg)
28 September 2022
Judgment
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# South Africa: South Gauteng High Court, Johannesburg
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## Ensemble Hotel Holdings Proprietary Limited v Gunzenhauser and Another (2021/10258) [2022] ZAGPJHC 726 (28 September 2022)
Ensemble Hotel Holdings Proprietary Limited v Gunzenhauser and Another (2021/10258) [2022] ZAGPJHC 726 (28 September 2022)
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sino date 28 September 2022
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IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG LOCAL
DIVISION, JOHANNESBURG
CASE NUMBER:
2021/10258
REPORTABLE: NO
OF INTEREST TO OTHER
JUDGES: NO
REVISED:
27/09/2022
In the matter between:
ENSEMBLE HOTEL
HOLDINGS PROPRIETARY LIMITED
(Registration Number
1999/018439/07)
Applicant
And
GUNZENHAUSER, MAXINE
(Identity Number
[....])
First Respondent
NAVISURE PROPRIETARY
LIMITED t/a NAVIBON
(Registration Number
2019/084594/07)
Second Respondent
J U D G M E N T
KAIRINOS
AJ:
“
Error
is ever the sequence of haste” said the Duke of Wellington. The
French playwright Moliere stated “Unreasonable
haste is the
direct road to error”. Never has this been more apt than to the
facts of this matter.
The
Applicant launched an application against the First and Second
Respondents as co-lessees for payment of arrear rentals in terms
of a
written lease agreement in respect of a residential property which it
is common cause the Applicant leased to the Second Respondent.
The
burning question is whether the parties intended that the Applicant
also leased the property to the First Respondent as co-lessee.
This
is because the First Respondent completed her details in the place
reserved for lessees. She contends she did so in error
and intended
to sign only as representative of the Second Respondent. Her main
defence to the application to hold her liable as
co-lessee was
therefore to seek rectification of the lease agreement to reflect
only the Second Respondent as lessee. This is the
main issue in the
matter.
Initially
the Second Respondent opposed the relief sought against it on the
basis of various spurious defences. Wisely, on the first
day of the
hearing, the Second Respondent indicated that it no longer relied on
such defences and withdrew its opposition to the
application. In the
circumstances, judgment was granted against the Second Respondent.
That
left the issue of the First Respondent’s liability to the
Applicant in terms of the lease agreement. The First Respondent
indicated in her answering affidavit that the lease had been
completed and signed in rushed circumstances when she met the
Applicant’s
leasing agent, Mr Chaim Bronstein (“Bronstein”),
at his doctor’s offices where he had an appointment. They met
in the waiting room of the doctor’s offices where the First
Respondent filled in the details of Second Respondent. However,
she
stated that instead of filling in her details in the appropriate
place reserved in the lease for a representative of a company,
she
erroneously filled in her details on the place above the company’s
details, which is a place reserved for lessees to
insert their
details. She stated that she immediately indicated to Bronstein that
she had made an error and he told her it was
fine and she should
complete the company’s (i.e. the Second Respondent’s)
details under her name. Importantly, in Bronstein’s
affidavit
attached to the Applicant’s replying affidavit, he did not
refute this allegation. Indeed, nowhere did he state
on oath that his
understanding was that both the First and Second Respondents were
intended to be co-lessees and he remained silent
in this regard in
his affidavit. In fact there was a glaring paucity of evidence on
oath as to what precisely the negotiations
had led him to believe in
relation to which party/s would be the lessee/s in the lease
agreement. It was clear it was agreed that
the Second Respondent
would be a lessee but nothing was mentioned by Bronstein of the First
Respondent.
The
Applicant relied heavily on the fact that in a prior and pending
action in the Magistrates’ Court for the eviction of
the
Respondents from the residential home, the Respondents had in their
plea admitted the allegation that they were both co-lessees.
Various
defences were raised in their plea in the Magistrates’
Court
[1]
, yet rectification of
the lease to reflect that only the Second Respondent was a lessee was
not raised by the First Respondent.
The Applicant correctly contended
that this was a factor which weighed against acceptance of the First
Respondent’s version
in the application. The First Respondent
in turn in her answering affidavit stated that the admission in the
Magistrates’
Court plea was made in error and that an
application for withdrawal of the admission and amendment of the
plea, would be launched
in due course. To date this had not been
done.
The
application for a lease, attached to the founding affidavit, also
seemed to tell a story. The first page of the application
form –
which it is common cause was completed by the First Respondent –
refers to a Dr Taitz as being the Applicant
for the lease. However,
the form then asks the question “
is lease to be concluded in
your name?
” with a “Yes” and “No”
as possible answers and one line down states “
If not, state
name
”. The First Respondent circled the “No”
thereby making it clear that the lease was not to be concluded in Dr
Taitz’s name and that he was not to be a lessee in his personal
capacity. In the appropriate space to insert the details of
corporate
entity that was to be the lessee, if the applicant for a lease was
not to be the lessee in their personal capacity, the
registration
number of the Second Respondent was completed and filled in, even
though its name was omitted. That section of the
form, once
completed, looked as follows:
“
Is
lease to be concluded in your name? Yes / (No)
.
If not, state name:
Company/CC/Trust name
Company/CC registration
number: 2019/084594/01”
However,
the remainder of the form referred in various places to the Second
Respondent and it is common cause that it was the Second
Respondent’s
banking details that were filled in the form. It is clear therefore
that the Second Respondent was intended
to be an applicant for the
lease and not Dr Taitz.
Then,
on the second of the application forms, the First Respondent
completed her details in the same space where she had filled
in Dr
Taitz’s details on the first page. However, she did not circle
the “Yes” or “No” in regard
to whether she
was to be a lessee in her personal capacity. But she did complete the
details of the Second Respondent in the appropriate
place where the
question was asked “
If not, state name
”. The fact
that she completed the Second Respondent’s name after the “
If
not, state name
” seemed to reflect that she did not intend
for the lease to be in her personal name either, but rather in the
name of the
Second Respondent. She did not complete the remainder of
the form, presumably because the Second Respondent’s details
and
banking details were already completed on the first application
form.
The
two application forms seemed to show that the Respondents intended
that only the Second Respondent was applying to be a lessee.
Furthermore,
in an email dated
16 August 2019, sent by the
First Respondent to Denny Goddard (a person in the employ of the
Applicant’s letting agent) and
to Bronstein and Dr Taitz, in
which the First Respondent replied to Denny Goddard, the First
Respondent had stated:
“
The
lease will be in the company name. Is it still the same form?”
This email was sent to
the aforesaid parties approximately one hour before the completion
and signature of the lease agreement by
the First Respondent. It
therefore appeared that at the time when she sent the said email to
Goddard, the First Respondent intended
that the Second Respondent
would be the lessee and was querying the application forms. There is
no evidence that any response was
sent by Goddard or Bronstein to
this query.
The aforesaid was
therefore the only evidence in the affidavits of the negotiations
preceding the conclusion of the lease agreement.
Faced with the fact
that the documents preceding the lease agreement seemed to indicate
that only the Second Respondent was intended
to be the lessee whereas
the Respondents had in the Magistrates’ Court admitted that the
First Respondent was a co-lessee
with the Second Respondent, I
decided to refer the issue of the rectification of the lease to oral
evidence.
I accordingly made the
following order, which referred to the matter to oral evidence in
relation to the issue of rectification
of the lease agreement and
also granted judgment against the Second Respondent:
“
1
The second respondent is to make payment to the applicant of: -
1.1
R 282 454.31;
1.2
R 138 333.75; and
1.3
interest upon the sums in [1.1] and [1.2]
supra, a temporae morae to date of payment at the rate prescribed
from time to time in
accordance with the provisions of the
Prescribed
Rate of Interest Act 55 of 1975
;
2
The second respondent is to make payment of the costs of the
application
on a scale as between attorney and own client.
3
As regards the first respondent’s liability (if any) to the
applicant:
-
3.1
the issue of whether the lease agreement
falls to be rectified as claimed by the first respondent in her
answering affidavit and
whether she is therefore jointly and
severally liable with the second respondent, is referred to the
hearing of oral evidence.
3.2
the evidence shall, unless the Court
directs otherwise, be that of the deponents to the various affidavits
in the application, subject
thereto that the first respondent’s
evidence shall be led first and she shall be subject to cross
examination;
3.3
No party may call any other witnesses save
with the leave of the court;
3.4
the parties shall, within fifteen court
days of this order, discover, on oath, any further documents they
wish to rely upon;
3.5
either of the parties may approach the
Deputy Judge President of this Division for preferential and/or
expedited allocation of the
hearing of the oral evidence referred to
in paragraphs [3.1] and [3.2] supra on a date as assigned by the
Deputy Judge President.
4
The costs against the first respondent are reserved for determination
at the hearing
of oral evidence.”
It had been agreed at a
pre-trial hearing before the hearing of the oral evidence, that since
the First Respondent bore the onus
to prove rectification, she would
have the duty to begin. However, on the first day of the hearing, the
Applicant, now represented
by Mr De Bruyn, applied for an amendment
of the order which had referred the matter to oral evidence to
introduce a further issue
for determination and that was the
following:
“
Whether,
as a matter of law, a valid and lawful contract was concluded between
the applicant and the first respondent.”
This arose because the
First Respondent contended that even if she did not prove
rectification of the lease agreement, she nevertheless
disputed and
put the Applicant to the proof of whether there had been a meeting of
the minds in relation to whether the First Respondent
was intended to
be a co-lessee and therefore whether there was consensus in regard to
this issue. The First Respondent therefore
raised the issue of
whether there was a valid and enforceable agreement between the First
Respondent and the Applicant. The First
Respondent contended that the
Applicant bore the onus in this regard.
At the hearing of the
oral evidence before me, the First Respondent testified and the
Applicant called Bronstein.
The
First Respondent testified that she was legally qualified and had
completed one year of articles at Webber Wentzel Attorneys.
The First
Respondent was relatively new to running the business of the Second
Respondent – which was a travel agency - or
indeed, the running
of a firm at all. The First Respondent testified that she is the
“adoptive” daughter of Dr Mark
Taitz, which adoption was
done pursuant to an oath before a Rabbi in accordance with Halakha of
the Jewish law. She subsequently
married Mr Dustin Ebben. She
testified that she never lived at the house in E [....] R [....]
Drive (being the leased property),
save for a two or three-week
period after her marriage when she and her husband stayed there while
they were waiting for their
new residential home to become available.
The
Second Respondent was an online travel company. The company was
funded by five shareholders through issued share capital of
some R2
million. The company was established in 2019, but from March 2020,
when the C
OVID-19
pandemic was in full
force and the travel business in general shut down, it led to the
demise of the Second Respondent. The First
Respondent was a small
(
less than
4%) shareholder of the Second
Respondent, although she was its sole director. Dr Taitz was the CEO
and in fact the controlling mind
of the Second Respondent and he ran
its business operations. It was not explained in evidence why Dr
Taitz was not a director of
the Second Respondent.
The First Respondent
explained that they had approached Bronstein to source a residential
home for Dr Taitz since he had to urgently
leave his current
residential home. Apparently, he had to vacate his previous home by
20 August 2019 and therefore had to find
a new home as a matter of
urgency. This also explained the rush to sign the lease agreement on
16 August 2019. She testified that
most of the discussions
surrounding the finding a new home were conducted between Dr Taitz
and Bronstein.
The First Respondent
testified how she completed the application forms and that as far as
she was concerned, the Second Respondent
was intended to be the
lessee and not herself in her personal capacity. She also testified
about the exchange of emails and Whatsapp
messages between herself,
Bronstein and Goddard.
The First Respondent did
initially testify that she has never authorized a credit check on
herself and that despite the fact that
she had not consented to a
credit check on herself, one was indeed conducted on her. However,
when confronted with an email - which
neither party had initially
discovered and which I gave leave to be used and discovered during
the oral evidence - she recanted
her evidence and testified that she
had written and sent the email granting the authorization for a
credit check on herself, from
her cellular phone whilst stopped at an
intersection on her way to meet Bronstein to sign the lease agreement
and she had forgotten
about it. She explained that her denial that
she had authorized the credit check was in the context of the
Whatsapp messages. The
relevance of this evidence is of course the
fact that on the probabilities, she would not have needed to
authorize a credit check
on herself if she was not intended to be a
co-lessee and the Applicant understandably spent much of its
cross-examination exploring
this issue. However, Bronstein in his
evidence provided the answer as to why it was necessary for the First
Respondent to have
a credit check done on her. He testified that when
dealing with a small and unknown company, it was the practice of his
letting
agency to require a credit check on the directors of the
company. This evidence refuted the contention that the only reason
that
a credit check was done on the First Respondent was because she
was intended to be a co-lessee. It therefore appeared from
Bronstein’s
evidence a credit check was undertaken on the First
Respondent simply because she was the sole director of the First
Respondent.
Tellingly, it was common
cause that no affordability check was done on the First Respondent
and she never provided her banking details
or bank statements to the
Applicant or Bronstein for the purposes of an affordability check.
Only the banking details and bank
statements of the Second Respondent
were ever provided to Bronstein and the Applicant.
The First Respondent then
explained what occurred on 16 August 2019 when she completed the
lease agreement and signed it. She testified
that she met Bronstein
at his doctor’s office at the Bluebird centre at approximately
15:00pm on the afternoon of Friday
16 August 2019. The importance of
the fact that it was a Friday was that both she and Bronstein were
Orthodox Jews who were required
to be home by sundown and they could
not drive after sundown because the Sabbath had begun. The meeting
was therefore rushed because
she had to leave in order to be home to
begin the preparations for the Sabbath.
She met Bronstein in the
doctor’s waiting rooms. She began completing the lease
agreement document.
Her actual evidence was
as follows:
“
I
met [Bronstein] .. I started filling this in and then obviously it
says full names. I write my full name and then below that I
saw it
said registration number or ID number. So when I realised that could
have been the company name written there, I just assumed
full name
mean my name. So I asked [Bronstein] if that line where I had just
written my name was meant to be the company name because
I see
registration number just below it and then he told me it is not a
problem. I can just write the company name just below where
I filled
in my details and then I proceeded to do that and then he took me
through where I needed to sign.”
Bronstein in turn
testified that when he met Dr Taitz and the First Respondent, he was
not aware of their exact relationship and
he viewed them as a “single
unit”. But whilst that may be so, the real question is whether
that single unit contracted
through the Second Respondent. In this
regard, Bronstein’s evidence was extremely vague. He could not
conclusively state
that his understanding was that the parties
intended that both the Second Respondent and the First Respondent
were intended to
be co-lessees or whether it was merely the Second
Respondent that was intended to be a lessee. When confronted with the
fact that
all the documentation and emails preceding the signature of
the lease seemed to point to only the Second Respondent being a
lessee,
he could not refute this. When he was asked why he believed
that the First Respondent had intended to bind herself as co-lessee
if all the preceding documentation seemed to indicate that only the
Second Respondent was intended to be a lessee, he could only
point to
the fact that the First Respondent had filled in her name on the line
for lessee in the lease agreement and it was not
for him to question
whether a person intended to bind themselves to the lease.
But of course, this
evidence begs the question whether the First Respondent made an error
in doing so. It also begs the question
what precisely the parties
common continuing intention was.
Tellingly, when the First
Respondent’s evidence that she had stated there and then in the
doctor’s office to Bronstein
that she had filled in her details
in the place for lessee instead of the place for representative and
he had told it was fine
and that she must merely also write in the
company’s details in the place for a lessee, he could not
recall that she had
said this and that he had so responded. However,
he could not deny it. He simply and honestly stated that he could not
recall but
could not deny that it had in fact occurred. He did
testify that in retrospect he would probably have rather stated that
she delete
her name and merely fill it in again under the company’s
name in the appropriate space reserved for the company representative
– but conceded that this was merely with the benefit of
hindsight.
To my mind, it is
plausible that Bronstein – if he knew that the Second
Respondent was intended to be the lessee (which he
must have at that
stage bearing in mind the lead up to the signature and the
documentation and emails preceding the signature)
– would have
said that it was fine that she signed in the wrong place because he
was aware that it was merely an error and
he was aware that it was
not the intention of the parties that the First Respondent be a
co-lessee in her personal capacity. Had
Bronstein intended (on behalf
of the Applicant) that the First Respondent be a co-lessee, he no
doubt would have ensured that he
obtained copies of her personal bank
statements and conducted an affordability check on her in addition to
the Second Respondent.
It is common cause that neither he, Goddard
nor the Applicant did so.
In
relation to the Applicant, it is appropriate at this juncture to
state that the Applicant was represented by Bronstein, even
though
the lease was signed by a representative of the Applicant. Bronstein
undertook all the negotiations on behalf of the Applicant
and
whatever common continuing intention was formed between the parties
was formed by Bronstein on behalf of the Applicant and
whatever
knowledge he had obtained was constructive knowledge of his
principal, the Applicant. The importance of this was because
the
Applicant contended that by filling in her details in the incorrect
place, the First Respondent had created the impression
with the
Applicant that she intended to sign as co-lessee, irrespective of the
prior intention expressed in the preceding documents
and
correspondence and that therefore she was bound in terms of the
principle of quasi-mutual assent
[2]
.
However, this submission fails since if Bronstein was aware that she
had filled in her details in the wrong place, then by constructive
knowledge, the Applicant was also aware and there is no quasi-mutual
assent established in such circumstances. Bronstein did not
and could
not refute the First Respondent’s evidence that she had
immediately told him that she had filled in her details
in the wrong
place and he had told her it was fine and she merely had to fill in
the company’s details below her name. This
too should have been
conveyed by Bronstein to his principal, the Applicant and even if it
was not, the Applicant is deemed to have
had constructive knowledge
thereof.
Rather curiously, the
representative of the Applicant who signed the lease agreement, made
the exact same error as made by the First
Respondent. Mr Adel
Abdulhamid Almahdi Emadani, also filled in his details in the place
for a co-lessor in addition to filling
in the details of the
Applicant. The only difference is that he then again and correctly
filled in his own details in the space
for the representative of the
Applicant. The question must be asked if he could make this mistake
as representative of the lessor,
why could the First Respondent not
make the same mistake as representative of the Second Respondent.
The
First Respondent attempted to suggest that there may therefore be an
issue of material misjoinder since the case law makes it
clear that
if there are two or more creditors (such as co-landlords) in an
agreement, they must both claim the debt jointly and
cannot claim
singularly or severally
[3]
.
However, this matter was conducted on the undisputed basis that the
Applicant and the Applicant alone was the lessor and this
much was
admitted not only in the Magistrates’ Court pleadings, but
again under oath in the First and Second Respondents’
answering
affidavit. It was not an issue in this matter and clearly the
insertion of Mr Adel Abdulhamid Almahdi Emadani’s
details in
the place for a lessor, was merely an error.
The test, after having
heard oral evidence from the witnesses is set out in
Stellenbosch
Farmers’ Winery Group Ltd & Another v Martell Et Cie &
Others
2003 (1) SA 11
(SCA)
as follows at paragraph [5] thereof:
“
[5]
On the central issue, as to what the parties actually decided, there
are two irreconcilable versions. So, too, on a number of
peripheral
areas of dispute which may have a bearing on the probabilities. The
technique generally employed by courts in resolving
factual disputes
of this nature may conveniently be summarised as follows. To come to
a conclusion on the disputed issues a court
must make findings on (a)
the credibility of the various factual witnesses; (b) their
reliability; and (c) the probabilities. As
to (a), the court's
finding on the credibility of a particular witness will depend on its
impression about the veracity of the
witness. That in turn will
depend on a variety of A subsidiary factors, not necessarily in order
of importance, such as (i) the
witness' candour and demeanour in the
witness-box, (ii) his bias, latent and blatant, (iii) internal
contradictions in his evidence,
(iv) external contradictions with
what was pleaded or put on his behalf, or with established fact or
with his own extracurial statements
or actions, (v) the probability
or improbability of particular aspects of B his version, (vi) the
calibre and cogency of his performance
compared to that of other
witnesses testifying about the same incident or events. As to (b), a
witness' reliability will depend,
apart from the factors mentioned
under (a)(ii), (iv) and (v) above, on (i) the opportunities he had to
experience or observe the
event in question and (ii) the quality,
integrity and independence of his recall thereof. As to (c), this
necessitates an analysis
and evaluation of the probability or
improbability of each party's version on each of the disputed issues.
In the light of its
assessment of (a), (b) and (c) the court will
then, as a final step, determine whether the party burdened with the
onus of proof
has succeeded in discharging it. The hard case, which
will doubtless be the rare one, occurs when a court's credibility
findings
compel it in one direction and its evaluation of the general
probabilities in another. The more convincing the former, the less
convincing will be the latter. But when all factors are equipoised
probabilities prevail.
”
It
is therefore clear that when all the factors are equipoised, the
probabilities prevail since, after all, a court is called upon
to
determine where the truth probably lies. In this regard it was held
as follows in
Haunt v Paramount Property 2020 JDR 1372 (GJ)
at
para [49]:
“
[49]
… In deciding whether that evidence is true or not the Court
will weigh up and test the plaintiff’s allegations
against the
general probabilities. The estimate of the credibility of a witness
will therefore be inextricably bound up with a
consideration of the
probabilities of the case and, if the balance of probabilities favour
the plaintiff, then the Court will accept
this version as being
probably true.”
This
is followed by the following
dicta
as to the order in which
the credibility and the probabilities are to be decided:
“
[49]
…
This view seems to me to
be in general accordance with the views expressed by Coetzee J in
Koster Köoperatiewe Landboumaatskappy
Bpk v Suid-Afrikaanse
Spoorweë en Hawens and African Eagle Assurance Co Ltd v Cainer.
I would merely stress, however, that
when in such circumstances one
talks about a plaintiff having discharged the onus which rested upon
him on a balance of probabilities,
one really means that the Court is
satisfied on a balance of probabilities that he was telling the truth
and that his version was
therefore acceptable. It does not seem to me
to be desirable for a Court first to consider the question of the
credibility of the
witnesses as the trial judge did in the present
case, and then, having concluded that enquiry, to consider the
probabilities of
the case, as though the two aspects constitute
separate fields of enquiry. In fact, as I have pointed out, it is
only where a consideration
of the probabilities fails to indicate
where the truth probably lies, that recourse is had to an estimate of
relative credibility
apart from the probabilities.”
The
Applicant argued vigorously that I should reject the First
Respondent’s version of rectification on the basis that her
credibility should be rejected due to the fact that she was not to be
believed having given incorrect evidence on the issue of
whether she
had granted consent to a credit check on herself and thereafter
recanting such version when confronted by her email
in which she did
indeed give such evidence. However, as set out above, she gave the
reasonable explanation that she had forgotten
about that email until
it was produced by the Applicant and it had been sent in haste from
her cellular phone whilst she was waiting
at an intersection on her
way to the meeting with Bronstein. Her version of why she had
forgotten about it is plausible and I have
no reason to reject it.
The
Applicant also contended that I should reject the First Respondent’s
credibility because it is improbable that an admitted
attorney would
make the errors in the lease agreement which she had made and that an
admitted attorney would immediately have advised
her legal team in
the Magistrates’ Court matter to plead rectification. However,
this ignores the fact that she was a relatively
inexperienced
attorney and had not been long in practice. Whilst it is so that she
was the managing director of her law firm, it
appeared from the
undisputed evidence that she was no more than a glorified office
manager and did not actually practice law other
than running the
administration of her law office. She employed various attorneys to
deal with the various departments in her law
firm. She testified that
when she received the Magistrates’ Court summons and since it
related largely to eviction and did
not pay sufficient attention to
it and she left it in the hands of her litigation team. In this
regard, she was extremely careless
and negligent and she admitted as
much. However, that does not mean that I should reject her
credibility or her version in this
regard.
The
First Respondent contended that it was more probable that she signed
the lease as co-lessee in error and that the lease agreement
did not
correctly reflect the parties’ common continuing intention and
should therefore be rectified. It is to these probabilities
that I
now turn.
The First Respondent’s
answering affidavit spelt out precisely what happened at the meeting
at the doctor’s rooms. On
three occasions, the First Respondent
identified that her name was inserted at the incorrect place and that
she had told Bronstein
of this immediately. In his affidavit,
Bronstein never seriously disputed any one of these statements.
The two lease application
forms completed by the First Respondent both clearly reflect the
lessee as the Second Respondent.
It is also improbable
that the First Respondent would incur a liability in excess of R500
000 per annum as a co-lessee for a company
of which she is less than
a 4% shareholder and in respect of a residential property which she
did not intend to reside in. This
is particularly so when there was
no evidence that the Applicant required her to sign as co-lessee.
The evidence is
unequivocal that the First Respondent had in an email informed
Bronstein that “the company” would be
the lessee.
Bronstein testified that he had received the forms and he never
denied receiving the said e-mail.
The Applicant never made
any enquiries regarding the First Respondent’s ability to
afford the rental. An affordability test
was only done on the Second
Respondent. This is a further indication that Bronstein and his
administration staff were well aware
that the lessee was intended to
be the Second Respondent.
That the First Respondent
probably erroneously completed her details in the place reserved for
lessees is the fact that the Applicant’s
representative made
the same error.
Lastly, it is common
cause that the lease document was completed in extreme haste and
under severe time pressures. This is what
probably led to the error
in its completion in regard to the First Respondent putting her
details on the line reserved for a lessee
instead of the line
reserved for a representative of the company. I need not refer again
to the statements with which I began this
judgment. Legally binding
documents should never be completed in haste for they then often lead
to much unnecessary heart-ache
and of course, costly litigation.
The requirements for
rectification have recently been summarised as follows in
Voltex
(Pty) Ltd v First Strut (RF) Ltd (In Liquidation) and Others
2022 (3)
SA 550
(GP)
at paragraph [49]:
“
[49] A
party seeking the rectification of an agreement needs to allege and
prove –
(i)
an agreement between the parties which was reduced to writing;
(ii)
that the written document does not reflect the common intention
of
the parties correctly;
(iii)
an intention by both parties to reduce the agreement to writing;
(iv)
a mistake in drafting the agreement;
(v)
the wording of the agreement as rectified.”
In
2020, the Gauteng Local Division in
Haunt v Paramount Property
2020 JDR 1372 (GJ)
elaborated upon the requirements for
rectification as follows at paragraphs [41] – [45]:
“
[41] The
remedy of rectification, which some authorities regard as an
exception to the parol evidence rule, allows for extrinsic
evidence
to be adduced in the determination of the intention of the parties in
a written agreement. The principle allows the Court
to infer into the
agreement
the intention of the parties from the evidence of the
negotiations.
In other words, it allows for the supplement of an
incomplete agreement with the relevant and material term or terms
that might
be missing.
[42] It is
through rectification that the Court presents to the parties a term
or terms which they might have failed
to include in recording their
agreement. It addresses the essential term which the parties may, by
mistake, have failed to include
in the agreement.
[43] …
Thus a mistake is an
essential element of rectification.
[44] The
common intention which the parties failed to reduce to writing
can
be inferred from the surrounding circumstances
.
The
unexpressed intention can thus amount to a tacit consensus
.
[45] In
Meyer
v Merchants Trust Ltd
, it was held:
‘… ‘
…
but there is no
reason in principle why that common intention should not be proved in
some other manner [other than an antecedent
agreement] provided such
proof is clear and convincing.”
In
Brits v Van Heerden Haunt v Paramount Property 2020 JDR 1372 (GJ),
the Court elaborated upon the nature of the mistake:
“
In
order to obtain rectification of a written contract, it is necessary
to prove that there was a mistake of some sort. The mistake
not
having to relate to the writing itself, but it can relate to the
consequence thereof. The mistake can be one common to both
parties,
of one party; or induced by misrepresentation or fraud – the
crux of the matter is that mistake, be it misunderstanding
of fact or
law or incorrect drafting of the document, it has to have the effect
of a written memorial not correctly reflecting
the parties’
true agreement.”
In
my view and on a balance of probabilities, the First Respondent has
discharged her onus of proving that it was the common continuing
intention of the parties that the lease would be in the name only of
the Second Respondent, that the lease agreement does not therefore
accurately reflect the common continuing intention of the parties,
that the First Respondent’s details being included in
the space
reserved for a lessee was in error and that the error came about
because of the haste with which the document was completed
and
signed.
Applying
the aforesaid principles and the probabilities of the matter, I am
satisfied that the First Respondent has discharged her
onus of
proving the requirements for the rectification of the lease
agreement. That being so, I need not deal with the alternative
issue
which is that the Applicant allegedly did not prove consensus in
regard to whether the First Respondent was to be a co-lessee
or not.
That
being said, had the First Respondent pleaded a reliance on
rectification in the preceding Magistrates’ Court action,
the
Applicant would no doubt not have proceeded by way of application at
all. However, when the issue was raised the Applicant
joined issue
and did not concede the First Respondent’s reliance on
rectification of the lease agreement. When it comes to
costs, I will
therefore disallow the First Respondent the costs of drafting,
preparation and service of the notice of motion and
founding
affidavit and annexures and award such costs to the Applicant as a
sign of my displeasure at the First Respondent’s
failure to
date to plead rectification in her plea in the Magistrates’
Court.
In
the circumstances, I make the following order:
1
The lease agreement, being annexure FA2 to the Applicant’s
founding affidavit,
is rectified to remove any reference to the First
Respondent as a co-lessee with the Second Respondent.
2
The application against the First Respondent is dismissed with costs
on the party and
party scale, save for the costs referred to in
paragraph 3 below.
3
The First Respondent is to pay to the Applicant the party and party
costs occasioned
by the drafting, preparation and service of the
notice of motion, the founding affidavit and annexures thereto, as
taxed or agreed.
G KAIRINOS
ACTING JUDGE OF THE
HIGH COURT
GAUTENG LOCAL DIVISION
JOHANNESBURG
(
Digitally
submitted by uploading on Caselines and emailing to the parties)
Appearances:
Counsel
for the Applicant:
Adv DS Hodge
Counsel
for the First Respondent: Adv W De Bruyn
Dates
of hearing: 8 October 2021; 28, 29 and 30 March 2022; 20 and 21 June
2022; 23 September 2022
Date
of judgment: 28 September 2022
[1]
The
Applicant attempted to make much of the fact that the defences
raised in the plea in the Magistrates’ Court action were
allegedly spurious and that this somehow affected the credibility of
the First Respondent. Since the matter in the Magistrates’
Court is not completed and still pending, I do not comment on the
veracity of these defences.
[2]
See
Pieters
& Co v Salomon 1911 AD 121
[3]
I
was referred to
Prinsloo
v Roets en Andere
1962 (3) SA 91
(O)
and
Grasslands
Agriculture (Pty) Ltd v Parmalat SA (Pty) Ltd 2011 JDR 0694 (ECG)
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