Future Business Advise and Services CC v Premier of Free State (7469/2008) [2010] ZAFSHC 30 (4 March 2010)

Future Business Advise and Services CC v Premier of Free State (7469/2008) [2010] ZAFSHC 30 (4 March 2010)

The court found that the mediation clause in the General Conditions of Contract did not make mediation a mandatory prerequisite to litigation, and the Premier failed to properly invoke any stay or arbitration procedure. The Premier's suspension and purported termination of the contract were unjustified, as the applicant had performed its obligations and any alleged breach was not substantiated or procedurally raised. The Premier, as the drafter of the contract, could not rely on ambiguity to avoid performance. The applicant, as the innocent party, was entitled to specific performance, and the Premier was ordered to permit the applicant to recommence services and pay all due invoices....

Citation
[2010] ZAFSHC 30
Parties
Applicant: Future Business Advice and Services CC; Respondent: Premier of the Free State
Court
Free State High Court, Bloemfontein
Jurisdiction
South Africa
Judgment Date
4 March 2010
Case Number
7469/2008
Procedural Posture
Specific Performance Application / Final Judgment After Opposed Application
Outcome
Application granted. The Premier is ordered to comply with the contract and permit the applicant to recommence services within one month, with costs awarded against the Premier.
Judges
Mocumie
Legal Topics
Specific Performance, Tender Contracts, Repudiation, Contractual Discretion, Mediation Clause
Commercial and Corporate Civil Procedure Specific Performance Tender Contracts Repudiation Contractual Discretion Mediation Clause

Case Brief

Summary, issues, holding and outcome

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Parties

Future Business Advice and Services CC

Applicant

Premier of the Free State

Respondent

Procedural Posture

Specific Performance Application / Final Judgment After Opposed Application

Legal Issues

  1. 1 Whether the Premier of the Free State was entitled to suspend and/or terminate the contract awarded to the applicant under tender BDR 4/2008.
  2. 2 Whether the applicant was required to refer the dispute to mediation before approaching the court.
  3. 3 Whether the applicant breached the contract or was entitled to specific performance.

Ratio Decidendi

The court found that the mediation clause in the General Conditions of Contract did not make mediation a mandatory prerequisite to litigation, and the Premier failed to properly invoke any stay or arbitration procedure. The Premier's suspension and purported termination of the contract were unjustified, as the applicant had performed its obligations and any alleged breach was not substantiated or procedurally raised. The Premier, as the drafter of the contract, could not rely on ambiguity to avoid performance. The applicant, as the innocent party, was entitled to specific performance, and the Premier was ordered to permit the applicant to recommence services and pay all due invoices....

Court Disposition

Application granted. The Premier is ordered to comply with the contract and permit the applicant to recommence services within one month, with costs awarded against the Premier.

Orders

  • The respondent (Premier) is ordered to comply with the terms and provisions of the contract embodied in tender number BDR 4/2008, permitting and authorising the applicant within one month of this order to recommence with the provision of agreed training and support services, against proper and due payment of all...
  • The respondent is ordered to pay the costs of this application on a party and party scale.