- December 9, 2022
- |Concise Law Reports (CLR), Contracts
The plaintiff sued for payment in the amount of N$2 489 140,50 in terms of an alleged construction agreement. The plaintiff filed a summary judgment application after the matter became defended. However, the said application was removed from the roll on the hearing date. The plaintiff filed a notice to amend its particulars of claim despite the defences raised in the answering affidavit opposing summary judgment. The first defendant excepted the particulars of the claim on the grounds that the particulars of the claim failed to disclose a cause of action and/or were vague and embarrassing. The plaintiff again filed a notice of intention to amend its particulars of claim on 7 August 2020. The first defendant objected to the proposed amendment because it would still render the particulars of the claim excipiable on several grounds. The plaintiff persisted and brought an application for leave to amend its particulars of claim, which was opposed but was granted.
In its amended particulars of claim, the plaintiff claimed that it is the lessee in respect of Erf 58/59 Okahandja, Khomas Region and as a result of a 25-year lease entered into between the plaintiff and the first defendant. The plaintiff further relied on the main claim based on an agreement and an alternative claim based on unjustified enrichment. The contractual claim was based on a written agreement allegedly entered on 25 February 2019. The plaintiff further pleaded that on 17 May 2019, the second defendant, in his capacity as accounting officer for the first defendant, acknowledged the first defendant’s indebtedness to the plaintiff in the sum of N$2 489 140,50, being the fees due to the plaintiff for the demolition work carried out.
The unjust enrichment claim was based on improvements made to the premises at Erf 58/59 Okahandja, in the mistaken but reasonable belief that the demolition works were allocated to the defendants from the plaintiff. The plaintiff further pleaded, in the alternative, that if there was non-compliance with statutory requirements in entering into the agreement, then the mistaken belief was reasonable in the circumstances and that the works were carried out on the authorization by the second defendant and treasury acting on behalf of the first defendant.
The matter proceeded to pre-trial wherein the parties identified the issues in fact and in law to be determined. At the commencement of the trial, Mr. Chibwana, acting on behalf of the plaintiff, informed the court that the plaintiff no longer persisted in its allegation that there was a lease agreement. He also indicated that the plaintiff would no longer rely on any claim based on an acknowledgment of debt. He submitted that the first defendant has the onus to start leading evidence because it alleged illegality and sought a ruling in that regard. Ms. Bassingthwaighte, on behalf of the first defendant, opposed this application launched from the bar and submitted that the plaintiff is required to first prove the contract, alternatively, the elements of its alternative claim and that, even though there are issues which the first defendant bears the onus for, the plaintiff has the onus to start.
The parties filed an amended draft pre-trial order with leave of the court which also contained a report of the joint position of the expert witnesses. The experts, insofar as it relates to the unjustified enrichment claim, agreed that the reasonable market-related costs for the demolition works are as per the calculations of the first defendant’s expert, based on the annual tender rates of the Ministry of Works and Transport, being an amount of N$1,298,162.49 (inclusive of VAT). As a result of the agreement reached, the parties also agreed that it would no longer be necessary to call the experts as witnesses. The issues for determination were further limited and on resumption of the matter, the plaintiff no longer persisted with its application that the defendant had the onus to start.
PRINSLOO J had to determine the issue of 1) whether the agreement concluded between the plaintiff and the defendant was a valid agreement as required under the Public Procurement Act, and 2) whether the defendants have been enriched at the plaintiff’s expenses in the amount of N$1 298 162,49, and held that:
- In terms of the requirements that formulate an agreement, Mr. Chibwana with all due respect, has lost sight of the fact that the plaintiff was dealing with a ministry within the government (the State) and that the Public Procurement Act provides the State and its agencies the power to contract and in doing so prescribes the formalities relating to the exercise of the States powers to contract. Mr. Chibwana can refer the court to an agreement entered into, but surely Mr. Chibwana cannot expect the court to look at the agreement in isolation. The agreement had to have been concluded in terms of the said Act set in place in order for it to be legal, lawful, and enforceable.
- It is clear from the Act that only the board or an entity to which the board has lawfully delegated its power could, pursuant to the award of the tender, contract or conclude an agreement on behalf of the State, and it is clear from the facts in this matter that this was not the case.
- Held further that: The court is convinced that the plaintiff carried out the demolition works in the mistaken but reasonable belief that the demolition works were due to the defendants by the plaintiff in terms of an agreement, because of the fact that the second defendant and Treasury authorized the demolition of the structures by the plaintiff. The plaintiff is entitled to payment for the demolition work done for the first defendant at Erf 58/59 Okahandja.
As a result, the plaintiff’s main claim was dismissed, but the plaintiff’s alternative claim of unjustified enrichment for N$1 298 162,49 was granted with costs. Such costs include one instructing and one instructed counsel.
Addi Inv Africa (Pty) Ltd v Minister of Works and Transport (HC-CIV-ACT-CON-2019.02327) [2022] NAHCMD 673 (9 December 2022)