- December 7, 2022
- |Civil Law, Practice, And Procedure, Concise Law Reports (CLR), Contracts
The plaintiff instituted a claim for the amount still outstanding being N$128 183.69 for various works done to a property consisting out of a house and an outside flat situated at 37 Bach Street Windhoek West. This is also the principle place of business of the defendant. It was alleged that Mr. Petrov presented a quatation to the defendant for the amount of N$47 422,75 to perform certain works at the request of the defendant to the said property on the alleged terms and conditions, that: upon approval of the quotation, an 80% deposit of the price quoted for the material and work had to be paid to the plaintiff prior to the commencement of the works; The work would be completed within 2 weeks upon payment of the 80% deposit; final invoice would be issued upon completion of the works; payment of final invoice would be payable within 30 days from issuance of the invoice; a monthly interest of 2.5% would be charged on overdue payments; all materials and equipment installed would remain property of the Plaintiff until the full quoted price was paid; any additional works outside the scope of the quotation required by the Defendant would be charged separately; all quantities would be provisional and final invoice would be issued on final measurement; and, the works carried out by the Plaintiff would have a 12 month guarantee on the workmanship.
The defendant made a deposit of N$30 000 (instead of N$37 938.20 which would have been 80%) on 12 March 2018, which then formed the acceptance of the quotation of 7 March 2018, made by Mr. Petrov. On 19 March the plaintiff presented the defendant with an amended quotation for N$133 521 upon the request of the defendant, as the defendant wanted the plaintiff to supply certain material and carry out electrical installation works, building works, plumbing installation, repairs to an electrical fence and installation of an alarm system. On 20 March 2018 and 9 April 2018, the quotations were further amended with additional work being requested by the defendant. The terms of these quotations however remained the same as above.
These terms either express terms, or alternatively tacit terms, of the quotations of 9 April 2018 were inter alia as follows and mostly appeared from the face of the quotation: upon approval of the quotation the defendant was required to pay a 50% deposit of the price quoted for the material and work, to plaintiff prior to the commencement of the works; once the works reached a completion stage of 90%, the defendant was required to pay 40% of the remaining amount of the quoted amount before the plaintiff could proceed with the final works; the work would be completed within 3 weeks upon payment of the deposit; final invoice would be issued upon completion of the works; payment of final invoice would be payable within 30 days from issuance of the invoice; a monthly interest of 2.5% would be charged on overdue payments; all materials and equipment installed would remain property of the Plaintiff until the full quoted price was paid; any additional works outside the scope of the quotation required by the Defendant would be charged separately; All quantities would be provisional and final invoice would be issued on final measurement; and, the plaintiff guaranteed to the defendant a 12 month guarantee on the workmanship.
The plaintiff was requested on 12 April 2018, by the defendant that the quotation should be made out to another company called Shakumu, Hoveka & Samuel Inc. This is a company that the defendant’s representative, Mr. Silas Kishi-Shakumu owned with his proposed business partners. A copy of this quotation was attached to the pleadings. On 28 May 2018, the quotation of 12 April 2018 was amended at the request of the defendant that the quotation be made out to the defendant, as opposed to Shakumu, Hoveka & Samuel Inc.
Between 12 March to June 2018, the plaintiff accepted payments from the defendant. It was the case of the plaintiff that the work should have been completed in 2 weeks but because he received continuous variations on the request for the work that needs to be performed, the defendant delayed making the required deposits, and there was some disagreement with the defendant and the new business they wished to be established.
The action was opposed by the defendant on the basis that defendant was not party to the agreement; that at all relevant times, the agreement was between the law fir of Shakumu, Hoveka and Samuel Incorporated (the “new” partnership); that two members of the new partnership abandoned it on 25 May 2018, and when plaintiff demanded progress payment, there was no money in the trust account of the new partnership and because the plaintiff refused to connect the electricity until such time as the outstanding money was paid, and he had to move into the building, the defendant had to foot the bill. He therefore needed an invoice in the name of the defendant for book-keeping purposes. The defendant further argued that the partnership of Shakumu, Kamuhanga & Samuel should at least have been joined as parties.
RAKOW J considered the legal principles of freedom of contract, breach, interpretation of contract and joinder, and stated that:
‘[27] The principle of freedom of contract was recognized by this Court in the matter of Markus v Telecom Namibia Ltd (I 286-2008) [2014] NAHCMD 207 (23 June 2014) where the court held that the courts will enforce an agreement that expresses the intention of the parties, however absurd the consequences may be. That court quoted with approval from decision of the South African Supreme Court of Appeal and said:
‘There is a well-established legal principle (known as pacta sunt servanda) which requires that a contract, however informal it be, such contract must be enforced. The principle of pacta sunt servanda recognizes a person’s right to enter into a contract and once having concluded the contract the parties to that contract have to live with the consequences arising from the contract so concluded.
[28] In order to determine whether or not a breach of this agreement occurred, we need to understand the concept of breach of contract and the requirements which need to be met in order to establish the breach. Christie R H: ‘The Law of Contract in South Africa.’ 5th ed, LexisNexis Butterworths at 495, defines breach of contract as follows:
‘The obligations imposed by the terms of a contract are meant to be performed, and if they are not performed at all, or performed late or performed in the wrong manner, the party on whom the duty of performance lay (the debtor) is said to have committed a breach of the contract or, in the first two cases, to be in mora, and, in the last case, to be guilty of positive malperformance.’
[29] The Supreme Court in Total Namibia (Pty) Ltd v OBM Engineering and Petroleum Distributors (SA 9 of 2013) [2015] NASC 10 (30 April 2015) O’Reagan JA referred to the South African case Natal Joint Municipal Pension Fund v Endumeni Municipality 2012 (4) SA 593 (SCA) where Wallis JA usefully summarized the approach to interpretation as follows:
‘Interpretation is the process of attributing meaning to the words used in a document, be it legislation, some other statutory instrument, or contract, having regard to the context provided by reading the particular provision or provisions in the light of the document as a whole and the circumstances attendant upon its coming into existence.
Whatever the nature of the document, consideration must be given to the language used in the light of the ordinary rules of grammar and syntax; the context in which the provision appears; the apparent purpose to which it is directed; and the material known to those responsible for its production. Where more than one meaning is possible, each possibility must be weighted in the light of all these factors. The process is objective, not subjective. A sensible meaning is to be preferred to one that leads to insensible or unbusinesslike results or undermines the apparent purpose of the document. Judges must be alert to, and guard against, the temptation to substitute what they regard as reasonable, sensible or businesslike for the words actually used.’
[30] Regarding joinder, Damaseb JP in Kleynhans v Chairperson of the Council for the Municipality of Walvis Bay and Others 2011(2) NR 437at 447, para 32 said the following:
‘The leading case on joinder in our jurisprudence is Amalgamated Engineering Union v Minister of Labour 1949 (3) SA 637 (A). It establishes that it is necessary to join as a party to litigation any person who has a direct and substantial interest in any order which the court might make in the litigation with which it is seized. If the order which might be made would not be capable of being sustained or carried into effect without prejudicing a party, that party was a necessary party and should be joined except where it consents to its exclusion from the litigation. Clearly, the ratio in Amalgamated Engineering Union is that a party with a legal interest in the subject matter of the litigation and whose rights might be prejudicially affected by the judgment of the court, has a direct and substantial interest in the matter and should be joined as a party.’
Having considered the legal principles and the evidence, it was held that:
- The defendant signed more than one quotation.
- It was clear that the instruction of the client changed from time to time, which resulted in the change of the total price of some of the items in the final invoice.
- The parties agreed to these terms forming part of the agreement and it should therefore be understood and interpreted by giving an interpretation to the simple meaning of the words.
- The obligation to bring an application for the joinder of the “new” firms rests with the defendant, which the defendant did not do, and that party was therefore not before court.
As a result, judgment was granted for the plaintiff in the amount of N$119 121.91 with costs.
Nam Electrical Serv CC v Silas-Kishi Shakumu and Co Inc (HC-MD-CIV-ACT-CON-2019-01115) [2022] NAHCMD 667 (07 December 2022)