Kakapa Skills Development Institute CC v Trustees of the Independent Development Trus (UM224/220) [2021] ZANWHC 30 (20 May 2021)

Kakapa Skills Development Institute CC v Trustees of the Independent Development Trus (UM224/220) [2021] ZANWHC 30 (20 May 2021)

The court found that the Respondent failed to prove objective impossibility of performance as required by law to invoke force majeure. The Respondent's financial difficulties and decision to implement austerity measures, including terminating leases, did not amount to impossibility but rather to subjective hardship. The lease agreement only provided for release from liability if the premises were destroyed, which was not the case. The Respondent did not plead or prove that it was truly incapable of performing its obligations, nor did it provide sufficient evidence of budgetary constraints or mitigation steps. The purported termination was therefore unjustified and amounted to repudiation,...

Citation
[2021] ZANWHC 30
Parties
Applicant: Kakapa Skills Development Institute CC; Respondent: Trustees of the Independent Development Trust
Court
North West High Court, Mafikeng
Jurisdiction
South Africa
Judgment Date
20 May 2021
Case Number
UM224/220
Procedural Posture
Declaratory Application / Part B: Final Relief After Urgent Interdict Dismissed
Outcome
Application granted; lease agreement not terminated; costs awarded against Respondent.
Judges
M Z Makoti
Legal Topics
Lease Agreement Termination, Force Majeure, Supervening Impossibility, Repudiation, Contractual Obligations
Commercial and Corporate Land and Property Lease Agreement Termination Force Majeure Supervening Impossibility Repudiation Contractual Obligations

Case Brief

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Parties

Kakapa Skills Development Institute CC

Applicant

Trustees of the Independent Development Trust

Respondent

Procedural Posture

Declaratory Application / Part B: Final Relief After Urgent Interdict Dismissed

Legal Issues

  1. 1 Whether the Respondent was entitled to terminate the lease agreement on grounds of force majeure due to the COVID-19 lockdown.
  2. 2 Whether the Respondent proved objective impossibility of performance under common law or contract.
  3. 3 Whether the purported termination amounted to repudiation of the lease agreement.

Ratio Decidendi

The court found that the Respondent failed to prove objective impossibility of performance as required by law to invoke force majeure. The Respondent's financial difficulties and decision to implement austerity measures, including terminating leases, did not amount to impossibility but rather to subjective hardship. The lease agreement only provided for release from liability if the premises were destroyed, which was not the case. The Respondent did not plead or prove that it was truly incapable of performing its obligations, nor did it provide sufficient evidence of budgetary constraints or mitigation steps. The purported termination was therefore unjustified and amounted to repudiation,...

Court Disposition

Application granted; lease agreement not terminated; costs awarded against Respondent.

Orders

  • The application succeeds.
  • It is declared that the lease agreement between the parties has not been terminated by the Respondent's purported termination on 14 August 2020.