Amalgamated Construction Company (Pty) Ltd v City Council of City of Durban (61/87) [1987] ZASCA 59 (27 May 1987)

Amalgamated Construction Company (Pty) Ltd v City Council of City of Durban (61/87) [1987] ZASCA 59 (27 May 1987)

The court held that the relevant contractual provisions, when read as a whole, clearly provide for liquidated damages to be payable for delays in the completion of individual batches of dwellings as well as for delays in the completion of the works as a whole. Clause 2(c) distinguishes between damages for incomplete individual dwellings after their stipulated batch completion dates and additional damages for delay in the completion of the entire works. The contract's structure, which requires progressive handover in batches to facilitate allocation and occupation, supports the respondent's interpretation. The references to 'period' and 'date' in clause 2(a) must be read as referring to...

Citation
[1987] ZASCA 59
Parties
Appellant: Amalgamated Construction Company (Pty) Ltd; Respondent: City Council of the City of Durban
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
27 May 1987
Case Number
61/87
Procedural Posture
Civil Appeal / Appeal From Declaratory Order in the Durban and Coast Local Division
Outcome
Appeal dismissed with costs, including costs of two counsel.
Judges
Corbett, Hoexter, Grosskopf, Nicholas, Boshoff
Legal Topics
Contract Interpretation, Liquidated Damages, Building Contracts, Declaratory Relief
Commercial and Corporate Civil Procedure Contract Interpretation Liquidated Damages Building Contracts Declaratory Relief

Case Brief

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Parties

Amalgamated Construction Company (Pty) Ltd

Appellant

City Council of the City of Durban

Respondent

Procedural Posture

Civil Appeal / Appeal From Declaratory Order in the Durban and Coast Local Division

Legal Issues

  1. 1 Whether liquidated damages under clause 2 of the Special Conditions of Contract are payable only for delay in completion of the entire works, or also for delay in completion of individual batches of dwellings.
  2. 2 Whether the wording of the contract supports the appellant's or respondent's interpretation regarding the timing and calculation of liquidated damages.
  3. 3 Whether subsequent amending agreements altered the original contractual provisions regarding liquidated damages.

Ratio Decidendi

The court held that the relevant contractual provisions, when read as a whole, clearly provide for liquidated damages to be payable for delays in the completion of individual batches of dwellings as well as for delays in the completion of the works as a whole. Clause 2(c) distinguishes between damages for incomplete individual dwellings after their stipulated batch completion dates and additional damages for delay in the completion of the entire works. The contract's structure, which requires progressive handover in batches to facilitate allocation and occupation, supports the respondent's interpretation. The references to 'period' and 'date' in clause 2(a) must be read as referring to...

Court Disposition

Appeal dismissed with costs, including costs of two counsel.

Orders

  • The appeal is dismissed with costs, including the costs of two counsel.