Case Law[2024] ZAGPJHC 1308South Africa
Riverland Holdings Limited v ENRC Mozambique Limitada (42562/2015) [2024] ZAGPJHC 1308 (10 November 2024)
Headnotes
of accounts (the bookkeeping was done in four accounts), on its face, relates to the provision of workers, including the flights to convey them to and from Mozambique. The first entry in the summary reads “Invoice E 00010001 – Provision of Construction Workers – January, 2013”. The relevant invoice includes the entry “1 (One) Construction Supervisor: Pieter De Klerk – 31 Days”. The last entry in the summary reads “Invoice 00010011 – Flights as per agreement – up to and including 30th June 2013”. The invoice itself details flights, who they were for, their origins and destinations, and one entry that relates to “Transfers & Accommodation.” The total amount outstanding according to the summary of accounts is US$1 827 200.65.
Judgment
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## Riverland Holdings Limited v ENRC Mozambique Limitada (42562/2015) [2024] ZAGPJHC 1308 (10 November 2024)
Riverland Holdings Limited v ENRC Mozambique Limitada (42562/2015) [2024] ZAGPJHC 1308 (10 November 2024)
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sino date 10 November 2024
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, JOHANNESBURG
Case
no: 42562/2015
(1)
REPORTABLE: Yes
(2)
OF INTEREST TO OTHER JUDGES: Yes
DATE:
10.11.24
SIGNATURE
In
the matter between:
RIVERLAND
HOLDINGS LIMITED
Applicant
and
ENRC
MOZAMBIQUE LIMITADA
Respondent
This
judgment was delivered by uploading it to the court online digital
database of the Gauteng Division of the High Court of South
Africa,
Johannesburg, and by email to the attorneys of record of the parties
on 10 November 2024.
JUDGMENT
VAN
DER WALT AJ
# Introduction
Introduction
[1]
This is a judgment about an application for specific
performance in terms of an oral agreement concluded in 2011.
The applicant,
Riverland, a company incorporated in the British
Virgin Islands, seeks to enforce the oral agreement and payment for
the performance
of its obligations in terms of it. The
respondent, ENRC, a Mozambican company, sought to raise a dispute
about the agreement’s
terms and Riverland’s performance
of its obligations under them. The notice of motion issued in
2015. The matter
comes before me after, among other things, a
confirmation of this court’s jurisdiction, extensive discovery
and an application
to dismiss the main application for delay.
[2]
Riverland’s case as set out in its founding affidavit,
deposed to by Mr Michael Gomes (who I will refer to as Mr Gomes), is
simple: Riverland concluded an oral agreement with ENRC. The
terms of that agreement were that Riverland would provide to
ENRC
labourers (or manpower), of diverse skills and skill levels, to work
on ENRC’s worksites in Mozambique. The agreement
was
amended a few times, but those amendments related only to
arrangements about the sending of invoices and terms of payment.
Riverland attached to its founding affidavit invoices, schedules and
accounts that show the outstanding amount due to for the labourers
provided to ENRC. As ENRC’s main argument at the hearing
was that there are disputes between the parties that cannot
be
resolved on the papers, I cannot otherwise but to set out the
parties’ cases as pleaded in the founding and answering
affidavit in some detail.
# The founding affidavit
The founding affidavit
[3]
The founding affidavit sets out background to the conclusion
of the agreement. Mr Gomes had prior dealings with ENRC.
He wore more than one hat at all relevant times. In addition to
being an agent for Riverland, he was also a director of Servicos
Atlántico (Pty) Ltd, a South African company. During the
first half of 2011, Servicos, represented by Mr Gomes, held
discussions with ENRC with the aim of providing all manner of
services, building materials and labourers to ENRC at its sites in
Mozambique. In these discussions, ENRC was represented by,
among others, Mr Johan Van Straaten, a construction manager, and
Mr
Graham Soden, a senior project manager. On 26 July 2011, Mr Van
Straaten telephonically told Mr Gomes that ENRC no longer
required
Servicos to provide it with labourers. ENRC and Servicos
contracted accordingly.
[4]
During the same conversation, Mr Van Straaten enquired whether
Riverland could provide the necessary labourers to ENRC. Mr
Gomes answered in the affirmative and a contract was concluded
telephonically between the two men in August 2011.
The
agreement was amended from time to time. In September 2011,
ENRC's Mr Craven informed Mr Gomes that ENRC required Riverland's
provision of labourers to be on a month-to-month basis. The
agreement was amended accordingly.
A
further amendment was effected in November of 2012. It related
to two of ENRC’s worksites. The fee payable for
labourers
who worked at those sites, would be paid only at the end of the
completion of the relevant projects
.
Further requests were made for payment to be delayed as
ENRC
faced financial constraints. Ultimately,
the
invoices were produced and submitted in March 2013 and were due for
settlement at th
e
end of April
2013.
In
the meantime, ENRC asked that Turner & Townsend
,
a
construction and cost management consultant firm, be included in the
invoicing process.
From
June 2012, therefore, Riverland sent its invoices and statements to
Turner & Townsend.
While
this arrangement initially applied only to some of ENRC’s
worksites,
Riverland
eventually would send all invoices and statements to Turner &
Townsend.
[5]
In May 2013
ENRC terminated the agreement with Riverland. ENRC had reports
compiled about the work done on its sites.
In November 2013,
these reports were presented to Mr Gomes. At this stage,
explains Mr Gomes, Riverland was in a severe
and desperate financial
situation as ENRC had not paid Riverland its due. In the
circumstances, Mr Gomes thought it best
to appease ENRC, attend their
sites, and consider its complaints. He also offered to make
good Riverland’s defective
performance, whatever there might
have been.
[6]
The invoices attached to Riverland’s
founding affidavit are detailed. The statements and summaries
of account less so.
They include generally short-hand
descriptions of the detail contained in the invoices, but contain
more than enough information
for the informed reader to know what the
entries relate to.
By
way of illustration, one entry for instance reads “Invoice
0001014 – Services June 2012 – Ref: Vehicle
maintenance”.
In the corresponding invoice, in a column
headed “description of items”, the two entries read “1
(One) Supervisor
/ Mechanic / Earthmoving: AndreOosthuizen” and
“1 (One) Mechanic LDV & Truck: Willem Koekemoer.”
One summary of
accounts (the bookkeeping was done in four accounts), on its face,
relates to the provision of workers, including
the flights to convey
them to and from Mozambique. The first entry in the summary
reads “Invoice E 00010001 –
Provision of Construction
Workers – January, 2013”. The relevant invoice
includes the entry “1 (One) Construction
Supervisor: Pieter De
Klerk – 31 Days”. The last entry in the summary
reads “Invoice 00010011 – Flights
as per agreement –
up to and including 30
th
June 2013”. The invoice itself details flights, who they
were for, their origins and destinations, and one entry that
relates
to “Transfers & Accommodation.”
The total amount
outstanding according to the summary of accounts is US$1 827 200.65.
[7]
Also attached
to Riverland’s founding affidavit is an e-mail, dated 29 July
2013, sent from Turner & Townsend to Riverland.
Attached to
the email are the “close out reports” relevant to
Riverland. They are similar to the statements produced
by
Riverland. When compared to the invoices, they are less
detailed. They contain invoice numbers, and whether a payment
certificate has been issued and payment has been made in respect of
each invoice. According to these close-out reports, ENRC
is
indebted to Riverland in the amount of US$1 955 229.40.
Riverland explains why ENRC is indebted to it for a
lesser
amount. Firstly, Turner & Townsend failed to consider some
of the funds received by Riverland from ENRC.
Secondly, the
close-out reports do not reflect invoices Riverland rendered between
March 2013 until June 2013.
[8]
Prior to the
issuance of the application, Riverland continued to seek payment from
ENRC, but to no avail. There were attempts
to settle the
matter, but nothing came of them. During these discussions Mr
Mulumba, the deponent to the answering affidavit,
asserted that
Riverland had committed fraud and that it was, in truth, the basis
for ENRC’s refusal to pay Riverland in accordance
with its
invoices. The allegation is not, however, to be found in the
answering affidavit. Prescription was pleaded,
but at the
hearing it too was abandoned as a defence.
The
answering affidavit
[9]
According to ENRC, the agreement concluded
telephonically through Mr Van Straaten and Mr Gomes is somewhat more
elaborate.
Mr Mulumba sets out the terms of the agreement.
His allegations in that regard are as follows:
“
20.2.1.
the Applicant would utilise the materials provided by Servicos
Atlantico to erect the three camps in terms of the specifications
referred to above and as set out in the original quotation of
Services Atlantico, and in accordance with the design drawings to
be
done by the Applicant and approved by the Respondent;
20.2.2. the Applicant
would provide all the required personnel (except unskilled labourers)
who would be responsible for the design,
erection, construction,
supervision, maintenance and management of the camps at the three
sites;
20.2.3. the Applicant
would utilise local unskilled labourers and would be responsible for
the supervision of such labourers;
20.2.4. the Applicant
would comply with all the laws and regulations applicable in
Mozambique;
20.2.5. the Applicant
would not only construct and erect the buildings required, but the
Applicant's scope of work included the
provision of the perimeter
fencing, the sewerage and water systems and plants and all the
electrical power installations;
20.2.6. the Applicant
would also provide the design drawings for all aspects of the camps.
. . . .
the personnel which the
Applicant was to provide included:
20.2.7.1. skilled
artisans, professionals, managers, consultants; supervisors and
20.2.7.2. experts and
technicians in the construction, maintenance, electrical, water and
sewerage reticulation spheres as well
as supervision, maintenance and
management thereof;
20.2.7.3. electricians,
air-conditioning experts, boilermakers, plumbers, tilers and master
builders;
once the Applicant had
completed the construction and handed over the camps, a final snag
list and list of defects, determined by
the Respondent, would be
provided to the Applicant to be remedied and attended to by the
Applicant;
20.2.9. the Respondent
would only pay the Applicant for necessary personnel who attended at
the site and worked on the sites to
perform the services;
20.2.10. the Applicant
would provide a proposal / quotation for the approval of the
Respondent in respect of the personnel which
it required on site.
.
. .
20.2.11. the Respondent
would approve the quote by issuing a purchase order in writing, by
email, to Services Atlantico but addressed
to the Applicant . . . .
20.2.12. after approving
the quote, the personnel would be sent to the site and after the work
was completed the Applicant would
generate invoices in respect of the
time actually spent on the site at the agreed rates stipulated in the
proposal/quotation;
20.2.13. the Respondent
would verify the invoices from the records on site and thereafter,
subject to verification, would make payment
to the Applicant.”
[10]
Attached to the answering affidavit are
documents described as the “confirmatory affidavits” of
Mr Soden, Ms Wake, Mr
Gettliffe and Ms Jackson. Mr Soden speaks
to the terms of the agreement, some of the events prior to the
conclusion of the
agreement, the role of Turner & Townsend and
the presentation to Riverland, around the time of the termination of
the oral
agreement, of written agreements in draft form. Ms
Wake also speaks to those written agreements. Mr Gettliffe, who
was one of the senior personnel on site for ENRC, speaks to what he
“believed” Servicos’ role was and Riverland’s
“scope of work”. Ms Jackson speaks to when and how
invoices became due and payable after the involvement of Turner
&
Townsend, the role of Turner & Townsend generally, a meeting she
had with Mr Gomes, and the invoices “actually
received by the
Respondent, represented by Turner and Townsend”.
[11]
In addition to making
allegations
about the terms of the agreement, Mr Mulumba gives evidence about
documents produced and events that occurred, before and after
its
conclusion. They are said to be indicative of the terms of the
agreement. Specifically, he says, that Riverland
owed
obligations other than merely providing manpower to ENRC’s
sites in Mozambique. He relies on emails sent to ENRC
between
July and September 2011, by Messrs Dyllan and Patrick Gomes.
They are said to show that Riverland agreed to provide
design
drawings for the work to be done. He points to an email written
by Mr Dyllan Gomes on 15 October 2012.
It
is said to show that it was “always the intention and agreement
of the parties” that defects would be remedied by
Riverland.
In this regard, he also refers
to a “proposal”
dated 20 October 2011 sent from Riverland to ENRC.
His
views, that the agreement related to more than the provision of
manpower, are confirmed, he says, by the fact that the close-out
reports prepared by Turner & Townsend contain phrases like
“construction services” and “vehicle maintenance
services”.
He
also points to a communication written in May 2013, when ENRC used
the phrase “
regarding
the provision by you of vehicle maintenance and repair services and
construction consulting services”.
This,
he says “clearly confirms that the version of the agreement
between the parties, as alleged by the Applicant, is incorrect
and
does not in truth reflect the actual agreement between the parties.”
As to the site meetings attended by Mr Gomes
in Mozambique, Mr
Mulumba says they came about as Riverland was obliged by the
agreement to complete the works and remedy the defects
in them.
As proof of Riverland’s defective provision of services, Mr
Mulumba attaches two reports to his affidavit.
Each relates to
a different worksite.
[12]
As the defence sought to be put up by Mr Mulumba focused on
the terms of the agreement as originally concluded, the answering
affidavit
takes no real issue with the content of the amendments as
alleged by Riverland. It does however include allegations about
Turner & Townsend’s mandate and seems to suggest that the
agreement, as amended or originally, it is not quite clear,
included
a term that ENRC would not be liable to pay Riverland for labourers
provided to ENRC if any one of a number of administrative
steps were
not followed to the letter.
ENRC
also sought to cast doubt on whether it indeed received all
Riverland’s invoices. To this end, Ms Jackson produced
a
“reconciliation” of invoices sent by Riverland and those
received by ENRC. Mr Mulumba does not take issue with
the fact
that ENRC received Riverland’s monthly statements of account.
The
replying affidavit
[13]
Riverland filed a lengthy replying affidavit. To
it is attached an affidavit by Mr Van Straaten. He confirms
that he
worked for ENRC as a
construction manager during the course of the agreement, that he was
stationed at their worksites in Mozambique,
and that the agreement
was concluded as alleged by Mr Gomes.
Argument
[14]
Both parties made arguments about the other’s
affidavits, or documents purporting to be affidavits, and why the
court should
not accept them. ENRC also took issue with Mr
Gomes’ authority to have had the application issued. As
far as
the merits are concerned, ENRC’s main argument was about
the disputes of fact on the papers. I deal first with the
arguments about the affidavits and authority, before I move on to the
argument about the disputes of fact.
Hearsay
[15]
Riverland
takes issue with the fact that all of Mr Mulumba’s evidence is
hearsay. It relies on section 3 of the Law
of Evidence
Amendment Act
[1]
in this
regard. The Act defines “hearsay evidence” as
“evidence, whether oral or in writing, the probative
value of
which depends upon the credibility of any person other than the
person giving such evidence.” Section 3(1)
of the Act
provides that “hearsay evidence shall not be admitted as
evidence at criminal or civil proceedings, unless . .
. (b) the
person upon whose credibility the probative value of such evidence
depends, himself testifies at such proceedings”.
Mr
Mulumba’s affidavit is not always clear on whether the
averments made about the terms of the oral agreement are his own
or
that of Mr Soden. For the purposes of this argument, however,
it does not matter. If it is so that Mr Mulumba makes
the
averments, the probative value of those averments does not depend on
anyone’s credibility but his. If it is so
that the
probative value of Mr Mulumba’s evidence depends on Mr Soden’s
credibility, the argument also cannot be successful,
because Mr Soden
made an affidavit. Lastly, the only person, one might imagine,
whose credibility Mr Mulumba and Mr Soden’s
evidence could ever
have depended on, is that of Mr Van Straaten. He, of course,
also made an affidavit, albeit confirming
Riverland’s case.
Mr Mulumba’s affidavit is not hearsay.
Technical
issues with the confirmatory affidavits
[16]
Riverland
also took issue with some of the technical aspects of Mr Soden, Ms
Wake and Mr Gettliffe’s affidavits. Mr
Soden and Ms
Wake’s affidavits, it argues, fall foul of the regulations
governing the administration of oaths and affirmations.
Riverland relies specifically on Regulation 4(2) of the Regulations
Governing the Administration of an Oath or Affirmation.
[2]
It provides a commissioner of oaths shall sign the declaration, and
print on it his full name and business address below
his signature.
It also requires the commissioner to state on the declaration what
his designation, or the office he holds,
is and the area for which he
holds that position.
[17]
In respect of Mr Soden’s affidavit, Riverland points out
that the necessary particulars of the commissioner of oaths are
absent.
As I read the relevant part of the affidavit, it was
signed by a commissioner of oaths. Below his signature is the
commissioner’s
full name in manuscript. Below his name is
a stamp of the South African Police Service station at Umhali,
Kwazulu-Natal.
It is also apparent that he is a police and
designated firearms officer. It does not expressly provide for
the area in which
these offices are held, but that seems to me to be
clear enough from the fact that he is a police officer at the Umhali
police
station.
[18]
As to Ms Wake’s affidavit, Riverland argues that it does
not comply with Regulation 4(2) as the document is only certified
as
a true copy of the original. It is indeed so: the stamp,
directly under the oath, includes the words “Certified
a true
copy of the original document laid before me”. It,
however, also includes the words “Commissioner of oaths”,
directly below the commissioner’s name and above the
commissioner’s business address. The stamp, on its face,
performs a dual function, allowing it to be used when the
commissioner administers an oath or affirmation, and when the person
using the stamp certifies a document as a true copy of the original.
This is not prohibited by the regulation. I don’t
uphold
the argument.
[19]
The argument regarding Mr Gettliffe’s affidavit goes
beyond technicalities. Riverland submits that the affidavit
does
not comply with Regulation 4(2) and that no affirmation or oath
was administered in respect of it. The document includes
English and Portugues versions of what purports to be an affidavit.
While both versions provide space
for
it,
a commissioner ostensibly did not certify that Mr Gettliffe
acknowledged that he knew and understood the contents of his
affidavit.
The document also does not contain any details of a
commissioner of oaths, or someone acting in a similar capacity.
As is apparent from the document, it is signed only by a
translator
. This means it falls foul of
Regulation 4(2) and leads to the conclusion that
no
commissioner of oaths administered any form of affirmation or oath in
respect of either version of the affidavit. The affidavit
falls
to be struck out. An order to that effect will follow.
The
authorisation of the main application
[20]
In its answering affidavit, ENRC disputed Mr Gomes’
authorisation to have had the application issued. It did not
rely
on Rule 7 of the Uniform Rules of Court in any way and did not
at any point (over the 9 years since the notice of motion issued)
assert its rights in terms of the Rule. Mr Gomes, to his
replying affidavit, attached a resolution he said is that of
Riverland.
It reads as follows:
“
Minutes of Meeting
& Resolution of the Sole Director of Riverland Holdings Ltd (‘the
Company’) held in Monaco on
20
th
January 2023
It was
recorded, resolved, and confirmed that Michael Gomes and Rosemary
Joyce have at all material times and remain
authorized
to
commence and advance on behalf of the Company, and to represent the
Company in, any and all legal proceedings as between the
Company and
ENRC Mozambique Ltd, especially as regards the litigation before the
High Court of the Republic of South Africa (in
Johannesburg) under
case no. 42562/2015.
[Signed]
Antony Janse Van Vuuren”
As result of the filing
of the resolution, ENRC’s argument changed. In its heads
of argument, it relied on Rule 63,
attacking the authenticity of the
resolution. At the hearing, the argument changed once more.
While maintaining the
attack on the authenticity of the resolution,
ENRC also sought to attack the content (and efficacy) of the
resolution.
[21]
Rule 7(1) of the Uniform Rules of Court provides that:
“
the authority of
anyone acting on behalf of a party may, within 10 days after it has
come to the notice of a party that such person
is so acting, or with
the leave of the court on good cause shown at any time before
judgment, be disputed, whereafter such person
may no longer act
unless he satisfies the court that he is authorised so to act, and to
enable him to do so the court may postpone
the hearing of the action
or application.”
The Rule exists for more
than one reason. First, it is to avoid a cluttering of the
pleadings unnecessarily with resolutions
and powers of attorney.
Secondly, it provides a safeguard against a person repudiating the
process and denying the authority
of the person who purported to
represent it.
[3]
Thirdly,
it seems to me, the Rule, as it includes a time limit for these
challenges and the leave of the court if the time
limit isn’t
abided, requires parties to make their cases about authority as soon
as possible and be done with it, lest years
of litigation ensue
unnecessarily. Fourthly, it affords someone whose authority is
challenged, the opportunity to satisfy
the court that he is indeed
properly authorised prior to the hearing of the main action or
application.
[22]
It
is established that the way to challenge the authority of anyone
acting on behalf of a litigant, is to use Rule 7(1).
[4]
ENRC did not do so and its arguments about authority, which includes
the eventual attack on the authenticity of the resolution,
fails for
this reason alone. It must be said that, in any event, the
facts as they are currently before me show Mr Gomes
to have been
properly authorised to represent Riverland. The resolution
itself constitutes proof of the authorisation.
ENRC placed no
evidence before the court to doubt its efficacy to that end. I
would imagine that it would have had to put
before the court the law
that applies to the resolutions of Riverland (a foreign company), and
its founding documents, to show
that in fact the resolution is
ineffective in its authorisation of Mr Gomes to act on behalf of
Riverland. As matters stand,
all the facts before the court
show that Mr Gomes was always properly authorised to represent
Riverland in its dealings with ENRC.
I have grave doubts about
whether ENRC was convinced of the merits of its argument in this
regard, in any event. It litigated
for almost 10 years against
Riverland, including taking and opposing interlocutory steps,
seemingly without any pressing need properly
to assert its point.
It also never challenged Mr Gomes’ authority to have
represented Riverland during the four years
leading up to the
litigation, or his authority to have concluded the agreement with
ENRC on Riverland’s behalf.
[23]
The
Rule 63 challenge is part of the challenge to Mr Gomes’
authority. It is also something that would have been ventilated
long before the hearing of the main application had ENRC properly
asserted its rights under Rule 7. The arguments based on
Rule
63, therefore, are unsuccessful also because of ENRC’s failure
to apply Rule 7. The Rule 63 challenge would in
any event not
have been upheld. Rule 63 is a rule about the authenticity of
documents. It defines “authentication”
as “when
applied to a document, the verification of any signature
thereon.”
[5]
The
provisions of the Rule are directory, not imperative and not
exhaustive.
[6]
Especially
the fact that it is not exhaustive, is apparent from Rule 63(4),
which provides:
“
Notwithstanding
anything in this rule contained, any court of law or public office
may accept as sufficiently authenticated any
document which is shown
to the satisfaction of such court or the officer in charge of such
public office, to have been actually
signed by the person purporting
to have signed such document.”
[7]
[24]
The
resolution is ostensibly signed by Mr Van Vuuren. Mr Gomes, who
has been acting as Riverland’s agent for, at the
time of the
filing of the resolution, more than a decade, is certainly also well
placed to identify Mr Van Vuuren’s signature
on the resolution,
as he impliedly did.
[8]
There is no reason to doubt him in that regard. I am satisfied
that the document is sufficiently authenticated.
Specific
paragraphs in Riverland’s replying affidavit breached ENRC’s
legal privilege
[25]
ENRC argues that the content of paragraphs 48 to 53 of
Riverland’s replying affidavit is privileged. The
paragraphs
include communications between a Ms Brown, ENRC’s
legal manager, and Mr Dai, a director of ENRC, that were sent to one
Mr
Barend Jacobus Smit. The exchange between Mr Dai and Ms
Brown occurred between 13 April 2022 and 10 May 2022. Ms Brown
sent some of the documents filed in this matter to Mr Dai. Mr
Dai then provides his views about the merits of the matter
and
informs Ms Brown how it should be conducted. The communications
were sent to Mr Smit by Mr Dai. Mr Smit put them
into evidence
by way of an affidavit attached to the replying affidavit. He
does not say why these messages were sent to
him or in what capacity
he received them.
[26]
Mr Eyles SC, for ENRC, argues that the content of the
paragraphs is protected by the legal professional privilege and
should be
struck out. Mr Smith SC, for Riverland, argues that
the privilege does not apply and, even if it does, that it has been
waived.
I do think these messages may very well be protected by
the legal professional privilege or the litigation privilege.
It
would depend at least on the relationship between Mr Dai and Mr
Smit, or the capacity in which Mr Smit received the messages, and
what Mr Dai’s intention in sending the messages to Mr Smit
was. The court, however, does not have before it these facts
or, for that matter, any affidavit by Mr Dai, let alone one
explaining the circumstances of his communications with Mr Smit.
Similarly,
the court does not have sufficient facts before it
to make any finding about whether or not ENRC waived a privilege,
whichever
might have obtained, to the content of the messages. In
light of the important role privileges play in ensuring the fairness
and efficiency of judicial proceedings, a role that gives effect to
Constitutionally enshrined rights, matter in replying affidavits
that
may be privileged, should be struck out. An order to that
effect will follow.
Disputes
of fact
[27]
ENRC argues that there are disputes of fact between the
parties about the terms of the oral agreement and whether Riverland
properly
has performed in terms of them. It submits that that
these disputes cannot be resolved on the papers and that the
application
is either to be referred to oral evidence or dismissed.
[28]
When,
in proceedings on motion, disputes of fact have arisen, a final order
generally may be granted only if the facts averred in
the applicant’s
affidavit which have been admitted by the respondent, together with
the facts alleged by the respondent,
justify such an order.
[9]
Courts, however, do have the power to make final orders in favour of
applicants in some cases where disputes have, at least
at face value,
arisen on the papers. One such case is where the allegations or
denials of the respondent are so far-fetched
or clearly untenable
that the court is justified in rejecting them on the papers.
This power of the court in application
proceedings was described by
Botha AJA in
Associated
South African Bakeries (Pty) Ltd v Oryx & Verenigte Backereien
(Pty) Ltd en Ander
as follows:
“
Op
die algemene reël is daar wel uitsonderings, soos bv waar die
bewerings of die ontkennings van die respondent so vergesog
of
klaarblyklik onhoudbaar is dat die verwerping daarvan bloot op die
stukke geregverdig is.”
[10]
The term “[k]laarblyklik
onhoudbaar” or clearly untenable has not received much judicial
treatment, but it seems to
me that, for denials and averments to be
tenable in a court of law, they must be made by witnesses and
deponents who have knowledge
of the facts they purport to speak to.
[29]
The case as pleaded by ENRC in respect of the terms of the
agreement has two parts. First, averments are made about the
terms
of the agreement as they were agreed during the conversation
between Mr Gomes and Mr Van Straaten. Second, references are
made to documents produced and events that occurred before and after
the actual conclusion of the oral agreement to evidence its
terms.
The averments made in support of both parts of the case are not made
by deponents with knowledge of the events they
purport to speak to.
[30]
As to the first part of the case, the two men put forward by
ENRC as having knowledge of the terms of the agreement are Messrs
Mulumba
and Soden. Neither of them, however, was on the call
with Mr Gomes and Mr Van Straaten when the agreement was concluded.
Nor were they with either Mr Van Straaten or Mr Gomes at the relevant
time. They simply do not have any knowledge about the
terms
agreed to during that conversation. The documents put into
evidence by Mr Mulumba takes the matter no further.
Absent an
attack on Mr Van Straaten and Mr Gomes’ credibility, an
interpretive exercise in respect of documents is irrelevant.
Let alone an interpretive exercise conducted by persons who have no
knowledge about the events described in these documents and
who are
not the scribes or recipients of the documents they interpret.
I might also remark that the agreement pleaded by
ENRC strikes one as
overly elaborate for one concluded orally, perhaps even fanciful and
wishful.
[31]
Merely for the sake of completeness, I do address the
documents ENRC relied on as “proof” of the terms of the
oral agreement.
Mr Mulumba placed specific reliance on a
document produced on
22
August 2011. It, however, is produced on a Servicos
letterhead. The fact that it was a document produced by
Servicos,
is perfectly reconcilable with Riverland’s version of
events, which is that initially Servicos would provide to ENRC labour
and much besides.
The emails written in September
of 2011 that Mr Mulumba rely on were also received from Servicos, not
Riverland.
The email
from
Dyllan
Gomes
ostensible written in October of 2012, which is said to be proof that
Riverland contracted for more than labourers, especially
as it
includes a reference to a “snag list”
is,
again, written on behalf of Servicos. He also throughout refers
to “we”, i.e. “us at Servicos”.
He
writes for example that:
“
Once we have
completed the construction and handed over the project, we are aware
that there will be a final snag list determined
by you, and that this
will then be attended to by us thereafter, as discussed.
. . . .
Kind regards,
Servicos Atlantico (Pty)
Ltd
Dyllan Gomes”
[32]
The proposal dated 20 October 2011,
also simply does not support Mr Mulumba’s interpretation.
While this
document
at least
on its face emanates from
Riverland and is headed “Proposal for Erection of Shed”,
the document continues and provides
a quotation for “1 x
Construction Team”, comprising “1 Construction
Supervisor” and “2 x Construction
Artisans”, at a
“daily labour rate”.
As for
the close-out reports
produced by Turner & Townsend, they do indeed contain the phrases
“construction services”
and “vehicle maintenance
services”, but the documents contain phrases that go to show
also that the agreement was only
for labourers: labourers
that
could perform vehicle maintenance and construction services.
[33]
About the site
meetings and the tender that followed them, it will be remembered, Mr
Mulumba says that had Mr Gomes not been obliged
to attend these site
meetings it would not have done so. Yet again, there is simply
no basis for this assertion. Mr
Mulumba is in no position to
make allegations about the intention with which these site meetings
were attended by Mr Gomes.
Mr Mulumba’s assertions about
why Riverland made a tender to rectify the defects in their
malperformance, whatever there
might have been, fall to be rejected
also on this basis.
[34]
During the hearing Mr Eyles SC pointed me to sections
of and phrases in various documents attached to the parties’
affidavits,
in addition to those emphasised by Mr Mulumba.
Specific emphasis was placed on the statements and invoices produced
by Riverland.
I do not agree with these arguments. A
party reading documents with an eye to find phrases and snippets that
go to show that
Riverland contracted for something other than merely
manpower might find some, but a dispassionate and objective reading
shows,
on the whole, that also these documents relate to the
provision of manpower.
[35]
ENRC’s averments about the terms of the agreement
fall to be rejected on the papers. Its deponents simply do not
have,
and could not have, knowledge of the terms of the agreement,
concluded as it was through Mr Gomes and Mr Van Straaten.
The
documents that go to defects in performance
[36]
T
he
only averments about defects in Riverland’s performance that
are relevant are those that go to Riverland’s provision
of
labourers to ENRC. The reports about Riverland’s
malperformance attached to the answering affidavit, that are intended
to show that the buildings were defective, are irrelevant. They
are in any event addressed to Servicos and are about Servicos’
malperformance. In the one, for instance, the introduction
reads: “An inspection was done in July 2013 on all Modular
and
Brick structure that was build (sic) by Servicos Atlantico (Pty)
Ltd”. In the other the introduction reads: “The
following report was conducted to establish the workmanship on Estima
Main Camp by Servico Atlantico”.
[37]
Conspicuously
absent from the answering affidavit is an
allegation or, in accordance with the nature of the defence put up,
correspondence from
a site manager of ENRC or any other person with
relevant knowledge, that labourers charged for by Riverland, as is
apparent from
the invoices and statements attached to the founding
affidavit, did not attend the worksites. Instead, ENRC sought
to allege
that some of the invoices sent by Riverland were not
received by ENRC (or Turner & Townsend).
[38]
These averments fall
to be rejected for numerous reasons.
They
are
made alongside an
admission by Mr Mulumba that ENRC did in fact receive the statements
sent by Riverland. The statements,
it is to be remembered, list
the invoices. Yet not once did ENRC, during the course of the
agreement, at the time of its
termination or shortly thereafter,
question the content of the statements, or ask for the invoices
listed in the statements that
it had not received.
ENRC’
case in this regard proceeds from the premise that the oral agreement
contained a term that excludes the liability of
ENRC to pay for
labourers provided to it by Riverland and properly accounted for in
the statements it received from Riverland,
simply because an
invoice
was not received in respect of those labourers at
the relevant time. According to the two men with knowledge of
the oral agreement,
it contained no such term. Nor was an
amendment effected, on any one’s version, that would have had
the agreement include
such a term.
[39]
In any event, it is only once
discovery was made by Riverland, more than a year a half after the
notice of motion issued, that ENRC
started to develop this part of
its case. It is then that Turner & Townsend produced its
reconciliation, which is said
to show
that
some invoices sent five years before had not been received at that
time. The reconciliation attached to the answering
affidavit
was made by
Ms
Jackson who was not the person responsible for ENRC and Riverland’s
account at the relevant times. She also does
not explain
exactly how the reconciliation was made. What is apparent, is
that it was made with reference to documents discovered
five years
after the event. As such, the reconciliation seems to be
nothing more than a comparison
between
two sets of
documents, by someone with no personal knowledge of the events
underlying either set, not only after the commencement
of litigation,
but indeed five years after the relevant events had occurred.
These averments cannot be accepted. They
were given no greater
weight, to put it at its lowest, by ENRC’s starkly contrasting
attempt to disavow the close-out reports
produced by Turner &
Townsend. Other than the reconciliation, they were produced
around the time of the agreement’s
termination, by the person
appointed to administer the Riverland account. They, of course,
showed ENRC to be indebted to
Riverland for more than what it claimed
in these proceedings.
Oral
evidence
[40]
ENRC’s averments have been found to be clearly untenable
and have been rejected on the papers. I am satisfied as to the
inherent credibility of Riverland’s averments and that
Riverland is entitled to the relief sought on the basis of case made
out in its founding affidavit. Rule 6(5)(g), which concerns the
court’s powers in terms of the rules to order the matter
to be
referred to oral evidence, is of application when “an
application cannot properly be decided on affidavit”.
This matter can properly be decided on the papers as ENRC’s
case is clearly untenable. There is therefore no reason
why the
matter should be referred to oral evidence. To the contrary,
the notice of motion issued nine years ago.
The parties have both made discovery. Yet ENRC has not managed
to lead evidence,
whether by way of further affidavits or otherwise,
of anyone with any relevant knowledge. A referral to oral
evidence would
make no difference in these circumstances.
[41]
In the event,
I make
the
following order:
1.
The document attached to the answering affidavit purporting to be an
affidavit by Mr Gettliffe
is struck out.
2.
Paragraphs 48 to 53 of the replying affidavit are struck out.
3.
The respondent is to pay to the applicant USD 1 827 200.65
(one million eight hundred
and twenty seven thousand two hundred
United States Dollars and sixty five cents) and interest on that
amount at the rate of 15.5%
per annum calculated from the end of June
2013 to date of payment.
4.
The main application is granted with costs on scale C, including
costs of two counsel.
Nico
van der Walt
Acting
Judge, Gauteng Division, Johannesburg.
Heard:
25 April
2024
Judgment:
10 November 2024
Appearances:
For
the applicants
Adv
H.J. Smith SC
with
him A. Myers
Instructed
by Myers Inc. Attorneys
For
the respondent
Adv
A. Eyles SC
Instructed
by Eric van den Berg Attorneys Inc
[1]
Act
45
of 1988.
[2]
Made
in terms of section 10 of the Justices of the Peace and
Commissioners of Oaths Act 16 of 1963 as published in GN R1258 of
21
July 1972, amended by GN R1648 of 19 August 1977, by GN R1428 of 11
July 1980 and by GN R774 of 23 April 1982.
[3]
Rural
Maintenance (Pty) Ltd and Others v Eskom Holdings SOC Ltd and
Another
(2023/027739)
[2023] ZAGPJHC 354 (20 April 2023) par. 21.
[4]
Limpopo
Provincial Council of the South African Legal Practice Council v
Chueu Incorporated Attorneys and Others
(459/22)
[2023] ZASCA 112
(26 July 2023)
par. 21.
[5]
Rule
63(1) of the Uniform Rules of Court.
[6]
Blanchard,
Krasner & French v Evans
2004 (4) SA 427
(W) 432H-I.
[7]
Rule
63(4) of the Uniform Rules of Court.
[8]
DT
Zeffert & AP Paizes,
The
South African Law of Evidence
(3rd edn 2017, LexisNexis) 960.
[9]
Stellenbosch
Farmers' Winery Ltd v Stellenvale Winery (Pty) Ltd
1957 (4) SA 234
(C) 235E – G;
Burnkloof
Caterers (Pty) Ltd v Horseshoe Caterers (Green Point) (Pty) Ltd
1976 (2) SA 930
(A) 938A – B;
Tamarillo
(Pty) Ltd v B N Aitken (Pty) Ltd
1982 (1) SA 398
(A) 430 1;
Plascon-Evans
Paints Ltd v Van Riebeeck Paints
(Pty) Ltd B
[1984] ZASCA 51
;
1984 (3) SA 623
(A) 634E - 635C; and
Associated
South African
Bakeries
(Pty) Ltd v Oryx & Vereinigte F Bäckereien (Pty) Ltd en
Andere
1982
(3) SA 893
(A) (
Oryx
)
923G - 924D.
[10]
Oryx
923G–924D.
sino noindex
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