Greyling and Another v Reid and Another (39248/2011) [2013] ZAGPPHC 39 (8 February 2013)

Greyling and Another v Reid and Another (39248/2011) [2013] ZAGPPHC 39 (8 February 2013)

The court found that clause 13 of the agreement was inserted for the benefit of the plaintiffs and gave them the discretion to cancel the contract if the balance sheet disclosed unacceptable risks. The evidence showed that the balance sheet was not delivered within the required period and, when delivered, raised concerns regarding accounting records and tax exposure. The plaintiffs exercised their discretion reasonably and in good faith. The defendants' arguments that the plaintiffs lacked sole discretion and that the cancellation was invalid were rejected. The court held that the plaintiffs validly cancelled the contract in terms of clause 13 and were entitled to a refund of the deposit....

Citation
[2013] ZAGPPHC 39
Parties
Plaintiff: Leonard Greyling; Plaintiff: Carl Greyling; Defendant: Magrieta Carolina Reid; Defendant: Olof Abraham Servaas von Landsberg
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
8 February 2013
Case Number
39248/2011
Procedural Posture
Civil Trial / Judgment After Trial
Outcome
Plaintiffs' claim upheld; contract validly cancelled; deposit and interest awarded.
Judges
A P Ledwaba
Legal Topics
Contract Cancellation, Deposit Refund, Sale of Shares, Subjective Discretion, Repudiation
Commercial and Corporate Contract Cancellation Deposit Refund Sale of Shares Subjective Discretion Repudiation

Case Brief

Summary, issues, holding and outcome

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Parties

Leonard Greyling

Plaintiff

Carl Greyling

Plaintiff

Magrieta Carolina Reid

Defendant

Olof Abraham Servaas von Landsberg

Defendant

Procedural Posture

Civil Trial / Judgment After Trial

Legal Issues

  1. 1 Whether the plaintiffs validly cancelled the sale agreement in terms of clause 13.
  2. 2 Whether the plaintiffs are entitled to a refund of the deposit paid under the agreement.
  3. 3 Whether the defendants' conduct constituted repudiation of the contract.

Ratio Decidendi

The court found that clause 13 of the agreement was inserted for the benefit of the plaintiffs and gave them the discretion to cancel the contract if the balance sheet disclosed unacceptable risks. The evidence showed that the balance sheet was not delivered within the required period and, when delivered, raised concerns regarding accounting records and tax exposure. The plaintiffs exercised their discretion reasonably and in good faith. The defendants' arguments that the plaintiffs lacked sole discretion and that the cancellation was invalid were rejected. The court held that the plaintiffs validly cancelled the contract in terms of clause 13 and were entitled to a refund of the deposit....

Court Disposition

Plaintiffs' claim upheld; contract validly cancelled; deposit and interest awarded.

Orders

  • The plaintiffs validly terminated the contract (annexure A) in terms of clause 13 of the Agreement.
  • Defendants are jointly and severally liable to pay the plaintiffs an amount of R100,000.