G. Liviero & Son Building (Pty) Ltd v Sundowner Property Development (Pty) Ltd (49/11) [2011] ZASCA 217; [2012] 2 All SA 43 (SCA) (29 November 2011)

G. Liviero & Son Building (Pty) Ltd v Sundowner Property Development (Pty) Ltd (49/11) [2011] ZASCA 217; [2012] 2 All SA 43 (SCA) (29 November 2011)

The Supreme Court of Appeal held that the arbitration clause in the Principal Building Agreement did not preclude the employer from approaching the court, as only the contractor could trigger the arbitration process. The court found that the issue had already been finally decided by Louw AJ in previous proceedings, and issue estoppel applied. The special plea of arbitration was therefore dismissed. Regarding the counterclaim, the court determined that only the claim relating to the contractor's purported cancellation of the agreement was barred by res judicata, as it had been finally adjudicated. The remainder of the counterclaim was not precluded, as those issues had not been finally...

Citation
[2011] ZASCA 217
Parties
Appellant: G. Liviero & Son Building (Pty) Ltd; Respondent: Sundowner Property Development (Pty) Ltd
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
29 November 2011
Case Number
49/11
Procedural Posture
Civil Appeal / Appeal From South Gauteng High Court, Johannesburg
Outcome
Appeal succeeds in part; orders of the court a quo set aside and replaced.
Judges
Cloete, Heher, Cachalia, Shongwe, Plasket
Legal Topics
Arbitration Clause Interpretation, Issue Estoppel, Res Judicata, Contractual Penalties, Builder S Lien
Commercial and Corporate Civil Procedure Arbitration Clause Interpretation Issue Estoppel Res Judicata Contractual Penalties Builder S Lien

Case Brief

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Parties

G. Liviero & Son Building (Pty) Ltd

Appellant

Sundowner Property Development (Pty) Ltd

Respondent

Procedural Posture

Civil Appeal / Appeal From South Gauteng High Court, Johannesburg

Legal Issues

  1. 1 Whether the arbitration clause in the Principal Building Agreement precluded the employer from approaching the court for relief.
  2. 2 Whether the doctrine of res judicata or issue estoppel barred the contractor's counterclaim based on issues previously adjudicated.
  3. 3 Whether the contractor lawfully cancelled the agreement and was entitled to the relief sought in its counterclaim.

Ratio Decidendi

The Supreme Court of Appeal held that the arbitration clause in the Principal Building Agreement did not preclude the employer from approaching the court, as only the contractor could trigger the arbitration process. The court found that the issue had already been finally decided by Louw AJ in previous proceedings, and issue estoppel applied. The special plea of arbitration was therefore dismissed. Regarding the counterclaim, the court determined that only the claim relating to the contractor's purported cancellation of the agreement was barred by res judicata, as it had been finally adjudicated. The remainder of the counterclaim was not precluded, as those issues had not been finally...

Court Disposition

Appeal succeeds in part; orders of the court a quo set aside and replaced.

Orders

  • The appeal succeeds in part.
  • The respondent is to pay the costs of the appeal.