eThekwini Municipality v Breakers Share Block Limited (42/2016) [2016] ZASCA 140 (29 September 2016)

eThekwini Municipality v Breakers Share Block Limited (42/2016) [2016] ZASCA 140 (29 September 2016)

The Supreme Court of Appeal held that the definition of 'floor area' in clause 1.2 of the Umhlanga Town Planning Scheme No. 1 is clear and unambiguous, and must be used for calculating rental under the lease agreements. The amendment to clause 6(b) did not change the method of calculation to exclude public areas as suggested by the respondent. The court found that the reference to 'calculated in accordance with the provisions of the Scheme' incorporates the definition in clause 1.2, and that clause 5.1 relates only to permissible floor area for building coverage, not to rental calculation. The parties' correspondence and subsequent conduct did not alter the contractual meaning. The court...

Citation
[2016] ZASCA 140
Parties
Appellant: eThekwini Municipality; Respondent: Breakers Share Block Limited
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
29 September 2016
Case Number
42/2016
Procedural Posture
Civil Appeal / Appeal From Kwa Zulu Natal Local Division, Durban
Outcome
Appeal upheld; respondent's action dismissed with costs, including costs of two counsel.
Judges
Mpati, Shongwe, Swain, Mocumie, Potterill
Legal Topics
Lease Agreement Interpretation, Rental Calculation, Town Planning Scheme, Contractual Construction
Land and Property Commercial and Corporate Lease Agreement Interpretation Rental Calculation Town Planning Scheme Contractual Construction

Case Brief

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Parties

eThekwini Municipality

Appellant

Breakers Share Block Limited

Respondent

Procedural Posture

Civil Appeal / Appeal From Kwa Zulu Natal Local Division, Durban

Legal Issues

  1. 1 Whether the amended lease clause 6(b) changed the method for calculating 'floor area' for rental purposes.
  2. 2 Whether 'floor area' should be determined by the definition in the Town Planning Scheme or by excluding certain areas as per clause 5.1 of the Scheme.
  3. 3 Whether the parties' subsequent conduct and correspondence altered the contractual meaning of 'floor area'.

Ratio Decidendi

The Supreme Court of Appeal held that the definition of 'floor area' in clause 1.2 of the Umhlanga Town Planning Scheme No. 1 is clear and unambiguous, and must be used for calculating rental under the lease agreements. The amendment to clause 6(b) did not change the method of calculation to exclude public areas as suggested by the respondent. The court found that the reference to 'calculated in accordance with the provisions of the Scheme' incorporates the definition in clause 1.2, and that clause 5.1 relates only to permissible floor area for building coverage, not to rental calculation. The parties' correspondence and subsequent conduct did not alter the contractual meaning. The court...

Court Disposition

Appeal upheld; respondent's action dismissed with costs, including costs of two counsel.

Orders

  • The appeal succeeds, with costs, including the costs of two counsel.
  • The order of the court a quo is set aside and substituted with: 'The plaintiff’s action is dismissed, with costs, including the costs of senior and junior counsel where employed.'