Rehau Polymer (Pty) Ltd v Brunettes Electrical (Pty) Ltd and Others (641/2018) [2019] ZASCA 101 (25 July 2019)

Rehau Polymer (Pty) Ltd v Brunettes Electrical (Pty) Ltd and Others (641/2018) [2019] ZASCA 101 (25 July 2019)

The majority held that CDC fulfilled its contractual obligations by constructing the premises in accordance with the building documents and local authority requirements, including installation of the fire suppression system and obtaining the certificate of occupancy. The warranties in the lease agreement pertained to the condition and statutory compliance of the premises at completion, not to operational matters such as activation of the fire suppression system post-occupancy. The failure to activate the system was an omission by CDC's agents, for which CDC was not contractually liable under the indemnity clause, as the warranties did not extend to ongoing operational compliance. The...

Citation
[2019] ZASCA 101
Parties
Appellant: Rehau Polymer (Pty) Ltd; Respondent: Brunettes Electrical (Pty) Ltd; Respondent: Schneider Electric SA; Respondent: Eastern Switchgear; Respondent: M & M Fire Protection CC; Respondent: Richard Nzuza & Associates Consulting Engineers CC; Respondent: Coega Development Corporation
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
25 July 2019
Case Number
641/2018
Procedural Posture
Civil Appeal / Appeal From Eastern Cape Division of the High Court, Port Elizabeth
Outcome
Appeal dismissed with costs of two counsel (majority). Dissenting judgments would have upheld the appeal and found CDC liable in contract for damages.
Judges
Ponnan, Swain, Mocumie, Makgoka, Eksteen
Legal Topics
Breach of Contract, Contractual Warranties, Statutory Compliance, Fire Safety Regulation, Agency Liability
Commercial and Corporate Land and Property Breach of Contract Contractual Warranties Statutory Compliance Fire Safety Regulation Agency Liability

Case Brief

Summary, issues, holding and outcome

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Parties

Rehau Polymer (Pty) Ltd

Appellant

Brunettes Electrical (Pty) Ltd

Respondent

Schneider Electric SA

Respondent

Eastern Switchgear

Respondent

M & M Fire Protection CC

Respondent

Richard Nzuza & Associates Consulting Engineers CC

Respondent

Coega Development Corporation

Respondent

Procedural Posture

Civil Appeal / Appeal From Eastern Cape Division of the High Court, Port Elizabeth

Legal Issues

  1. 1 Whether the failure to activate the gas fire suppression system constituted a breach of contractual warranties by the sixth respondent.
  2. 2 Whether the sixth respondent (CDC) is liable in contract for damages arising from the fire due to breach of statutory and municipal fire safety obligations.
  3. 3 Whether the indemnity clause in the lease agreement excludes CDC's liability for damages caused by its agents.

Ratio Decidendi

The majority held that CDC fulfilled its contractual obligations by constructing the premises in accordance with the building documents and local authority requirements, including installation of the fire suppression system and obtaining the certificate of occupancy. The warranties in the lease agreement pertained to the condition and statutory compliance of the premises at completion, not to operational matters such as activation of the fire suppression system post-occupancy. The failure to activate the system was an omission by CDC's agents, for which CDC was not contractually liable under the indemnity clause, as the warranties did not extend to ongoing operational compliance. The...

Court Disposition

Appeal dismissed with costs of two counsel (majority). Dissenting judgments would have upheld the appeal and found CDC liable in contract for damages.

Orders

  • The appeal is dismissed with costs of two counsel.