Pillay and Another v Shaik and Others (006/08) [2008] ZASCA 159; 2009 (4) SA 74 (SCA) ; [2009] 2 All SA 435 (SCA) (27 November 2008)

Pillay and Another v Shaik and Others (006/08) [2008] ZASCA 159; 2009 (4) SA 74 (SCA) ; [2009] 2 All SA 435 (SCA) (27 November 2008)

The Supreme Court of Appeal held that, in the absence of a statutory requirement or a pre-existing agreement prescribing signature as a condition for contractual validity, the conduct of the respondents, through their attorneys and agents, induced the appellants to reasonably believe that binding contracts had been concluded. The doctrine of quasi-mutual assent applies where the offeree's conduct leads the offeror to believe acceptance has occurred, even if the prescribed mode of acceptance (signature) was not followed. The evidence showed that the respondents' agents received deposits, allocated units, and corresponded as if the agreements were binding, thereby misleading the appellants....

Citation
[2008] ZASCA 159
Parties
Appellant: Selvin Pillay; Appellant: Makgala Solomon Motlanthe; Respondent: Iqbal Shaik; Respondent: Edward John Hammond; Respondent: Maurice Leslie Wenham; Respondent: Luca Giovanni Liviero; Respondent: Ahmed Saeed Vawda; Respondent: Michael Hugh Blake; Respondent: Swaledale 9 Investments CC; Respondent: MTR Trading CC; Respondent: Mooney Ford Attorneys; Respondent: Dusky Dolphins Shareblock (Pty) Ltd; Respondent: The Registrar of Companies and Close Corporations, Pretoria; Respondent: The Registrar of Deeds, Pietermaritzburg
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
27 November 2008
Case Number
006/08
Procedural Posture
Civil Appeal / Appeal From the Pietermaritzburg High Court, Following Trial and Full Bench Appeal
Outcome
Appeal upheld; agreements declared binding; specific performance ordered against the sellers.
Judges
Farlam, Lewis, Jafta, Maya, Kgomo
Legal Topics
Contract Formalities, Quasi Mutual Assent, Sale of Members Interest, Alienation of Land Act, Specific Performance, Binding Effect of Conduct
Commercial and Corporate Civil Procedure Land and Property Contract Formalities Quasi Mutual Assent Sale of Members Interest Alienation of Land Act Specific Performance +1 more

Case Brief

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Parties

Selvin Pillay

Appellant

Makgala Solomon Motlanthe

Appellant

Iqbal Shaik

Respondent

Edward John Hammond

Respondent

Maurice Leslie Wenham

Respondent

Luca Giovanni Liviero

Respondent

Ahmed Saeed Vawda

Respondent

Michael Hugh Blake

Respondent

Swaledale 9 Investments CC

Respondent

MTR Trading CC

Respondent

Mooney Ford Attorneys

Respondent

Dusky Dolphins Shareblock (Pty) Ltd

Respondent

The Registrar of Companies and Close Corporations, Pretoria

Respondent

The Registrar of Deeds, Pietermaritzburg

Respondent

Procedural Posture

Civil Appeal / Appeal From the Pietermaritzburg High Court, Following Trial and Full Bench Appeal

Legal Issues

  1. 1 Whether the agreements of sale between the parties were invalid due to lack of signature by the prospective seller.
  2. 2 Whether the doctrine of quasi-mutual assent applies to bind the parties despite non-compliance with prescribed mode of acceptance.
  3. 3 Whether the Alienation of Land Act 68 of 1981 requires the sale of a member's interest in a close corporation owning immovable property to be in writing.

Ratio Decidendi

The Supreme Court of Appeal held that, in the absence of a statutory requirement or a pre-existing agreement prescribing signature as a condition for contractual validity, the conduct of the respondents, through their attorneys and agents, induced the appellants to reasonably believe that binding contracts had been concluded. The doctrine of quasi-mutual assent applies where the offeree's conduct leads the offeror to believe acceptance has occurred, even if the prescribed mode of acceptance (signature) was not followed. The evidence showed that the respondents' agents received deposits, allocated units, and corresponded as if the agreements were binding, thereby misleading the appellants....

Court Disposition

Appeal upheld; agreements declared binding; specific performance ordered against the sellers.

Orders

  • The appeal against the order of the court a quo is upheld with costs, including the costs of two counsel.
  • The order of the court a quo is set aside and replaced with an order declaring the agreements of sale to be of full force and effect and binding between the parties, with terms as set out in the relevant documents.