- January 25, 2023
- |Concise Law Reports (CLR), Contracts
Mis Hamza Construction v Britz NAHCMD (25 January 2023)
The plaintiffs instituted action against the defendant. The matter concerned the plaintiffs’ claim of unjust enrichment of the defendant at the expense of the plaintiff, a claim for the return of a truck that was in the defendant’s possession, and a claim for the return of nine plastic tanks in the possession of the defendant. At the close of the plaintiffs’ case, the defendant brought an application for absolution from the instance. The court granted the application. What remained to be considered was the defendant’s counterclaim.
In the counterclaim the defendant alleged that upon a cession agreement (‘the Agreement’) concluded by and between the plaintiffs and the defendant, the defendant undertook certain construction works. The defendant alleged that it was a term of the Agreement that the defendant shall purchase all equipment necessary to complete the works and that the plaintiffs would reimburse the defendant the cost of the equipment so purchased. It is the defendant’s case that he complied with his obligation under the Agreement and while executing the works he incurred a loss in the amount of N$286 037.62 which he now claims from the plaintiffs.
Thus, for the counterclaim, the defendant relies on the so-called ‘Cession Agreement’ (‘the Agreement’). The defendant pleaded that the first plaintiff represented by the second plaintiff and the defendant in person and at Windhoek concluded the ‘Cession Agreement’ during June 2019. And pursuant to rule 45(7) of the rules of court, the defendant annexed a true copy of the Agreement to the pleading marked Annexure ‘A’.
The defendant pleaded that the Agreement was entered into by and between the first plaintiff and the defendant, yet the contracting parties included not only the first plaintiff and the defendant, but also the ‘Small Medium Enterprise(s) Bank’ as appears at both the beginning, and in the testimonium clause, of the Agreement. Thus, the following crucial questions arose on the pleadings; and no evidence was led by the defendant to deal with them. There appears to be three parties to the Agreement, that is, the plaintiffs, the defendant and the Small Medium Enterprise(s) Bank (‘the SME Bank’). In the maze of uncertainty and absurdity, the important questions that arise are these: Who is the cedant, who is the cessionary, and what is the ceded obligation? These questions are crucial in the instant proceeding because it is the cessionary who is entitled to sue in his or her own name on the ceded obligation (I Isaacs, Beck’s Theory and Principles on Pleading in Civil Actions, 5 ed (1982) at 304).
As respects signatures appended to the Agreement, Patrick John Britz signed on 6 June 2019; and there is a signature of a witness. There is no signature for the SME Bank. And Hendrik Henrich Sali signed on 7 June 2019; and there is a signature of a witness. Although there is no signature for the SME Bank, there are terms in the Agreement entitled ‘Responsibility of the SME Bank’, indicating that the SME Bank was a party to the Agreement, but, as indicated ad nauseam, the defendant pleaded that the Agreement was entered into between and by the plaintiffs and the defendant only. Similarly, there are terms entitled ‘Responsibility of Mr Britz’ and ‘Responsibility of Mr Sali’. Mr Britz is the defendant in convention and the plaintiff in reconvention. Mr Sali is the second plaintiff in convention and the second defendant in reconvention, as aforesaid.
PARKER AJ stated that:
‘[8] The weakness of Mr Britz’s case is accentuated by the fact that the Agreement is not a valid agreement. As a matter of law, Mr Britz cannot insist that a contract existed upon which he could sue in a counterclaim when the written agreement he relies on has not been signed by all the parties and therefore invalid. A written contract comes into existence when, and only when, it has been signed by all the parties thereto (RH Christie The Law of Contract in South Africa, 3 ed (1996) at 118; and the cases there cited). After all, a party relying on a cession must allege and prove the contract of cession ( LTC Harms Amler’s Precedent of Pleadings, 4 ed (1993) at 59; and the cases there cited). Mr Britz, the plaintiff in reconvention, has failed to prove the existence of such contract.
[9] Keeping in my mind’s eye the foregoing analysis and conclusions in paras 4-8, I come to the ineluctable conclusion that the counterclaim must fail; and it fails. On the pleadings and the evidence, I find that there is no valid cession agreement which the court is entitled to enforce against the plaintiffs. The defendant has failed to establish any legal basis upon which his counterclaim could be sustained. The pleading and the evidence do not establish a right in the relief claimed. It is therefore not safe to uphold the defendant’s counterclaim against the plaintiffs.’
As a result, the defendant’s claim was dismissed with costs limited to disburesment reasonably incurred by the plaintiffs in resisting the counterclaim.