Pape v El Gondor Trading 220 (Pty) Ltd and Another (11090/12) [2014] ZAGPPHC 859 (7 October 2014)

Pape v El Gondor Trading 220 (Pty) Ltd and Another (11090/12) [2014] ZAGPPHC 859 (7 October 2014)

The court found that the payment of R1.2 million into Eminent Finance's account was made pursuant to an oral variation of the written management agreement, authorised by the second defendant acting for the first defendant. The non-variation clause could not be relied upon by the first defendant, as its conduct in leading the plaintiff to believe the payment was proper and subsequently attempting to avoid liability was unconscionable and contrary to public policy. The evidence showed that the plaintiff was not an investor with Eminent Finance but with the first defendant, as reflected in the ledger and supported by the payment of monthly yields and tax certificates issued by the first...

Citation
[2014] ZAGPPHC 859
Parties
Plaintiff: Richard Frederick Pape; Defendant: El Gondor Trading 220 (Pty) Ltd; Defendant: Hendrik Christoff Viljoen
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
7 October 2014
Case Number
11090/12
Procedural Posture
Civil Trial / Judgment
Outcome
Judgment granted against the first defendant for payment of capital and interest, plus costs.
Judges
D S Fourie
Legal Topics
Oral Variation of Contract, Non Variation Clause, Contractual Liability, Prescribed Interest, Management Agreement
Commercial and Corporate Civil Procedure Oral Variation of Contract Non Variation Clause Contractual Liability Prescribed Interest Management Agreement

Case Brief

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Parties

Richard Frederick Pape

Plaintiff

El Gondor Trading 220 (Pty) Ltd

Defendant

Hendrik Christoff Viljoen

Defendant

Procedural Posture

Civil Trial / Judgment

Legal Issues

  1. 1 Whether the oral variation of the written management agreement, permitting payment into Eminent Finance's account, vitiated the contract.
  2. 2 Whether the first defendant is liable to repay the capital and interest to the plaintiff under the management agreement.
  3. 3 Whether the first defendant can rely on the non-variation clause to avoid liability.

Ratio Decidendi

The court found that the payment of R1.2 million into Eminent Finance's account was made pursuant to an oral variation of the written management agreement, authorised by the second defendant acting for the first defendant. The non-variation clause could not be relied upon by the first defendant, as its conduct in leading the plaintiff to believe the payment was proper and subsequently attempting to avoid liability was unconscionable and contrary to public policy. The evidence showed that the plaintiff was not an investor with Eminent Finance but with the first defendant, as reflected in the ledger and supported by the payment of monthly yields and tax certificates issued by the first...

Court Disposition

Judgment granted against the first defendant for payment of capital and interest, plus costs.

Orders

  • The first defendant must pay R1 301 038.00 to the plaintiff.
  • The first defendant must pay interest on the above amount at the prescribed mora rate from 12 September 2010 to date of payment.