Secure Electronics v City of Cape Town (24107/2012) [2017] ZAWCHC 95 (13 September 2017)

Secure Electronics v City of Cape Town (24107/2012) [2017] ZAWCHC 95 (13 September 2017)

The court held that the plaintiff's cause of action for the delay claim only arose upon completion of the contractual mechanism set out in clause 48 of the GCC, specifically when the engineer either approved the claim and issued a payment certificate or repudiated the claim. The issuing of a payment certificate was a condition precedent to payment, and until the claim was assessed and determined, no enforceable claim existed. The engineer repudiated the claim on 25 November 2011, and the summons was served on 7 January 2013, well within the three-year prescription period. The court rejected the defendant's argument that the plaintiff unilaterally delayed the running of prescription,...

Citation
[2017] ZAWCHC 95
Parties
Plaintiff: Secure Electronics; Defendant: City of Cape Town
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
13 September 2017
Case Number
24107/2012
Procedural Posture
Civil Procedure / Special Plea of Prescription Determined Prior to Main Hearing.
Outcome
Defendant's special plea of prescription dismissed; costs reserved for later determination.
Judges
Kusevitsky AJ
Legal Topics
Prescription Act, Construction Contracts, Delay Claims, Condition Precedent, Payment Certificates
Civil Procedure Commercial and Corporate Prescription Act Construction Contracts Delay Claims Condition Precedent Payment Certificates

Case Brief

Summary, issues, holding and outcome

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Parties

Secure Electronics

Plaintiff

City of Cape Town

Defendant

Procedural Posture

Civil Procedure / Special Plea of Prescription Determined Prior to Main Hearing.

Legal Issues

  1. 1 Whether the plaintiff's claim for compensation under the contract was extinguished by prescription.
  2. 2 When did the plaintiff's cause of action arise for purposes of prescription under the Prescription Act.
  3. 3 Whether the issuing of a payment certificate under the contract was a condition precedent to the plaintiff's entitlement to payment.

Ratio Decidendi

The court held that the plaintiff's cause of action for the delay claim only arose upon completion of the contractual mechanism set out in clause 48 of the GCC, specifically when the engineer either approved the claim and issued a payment certificate or repudiated the claim. The issuing of a payment certificate was a condition precedent to payment, and until the claim was assessed and determined, no enforceable claim existed. The engineer repudiated the claim on 25 November 2011, and the summons was served on 7 January 2013, well within the three-year prescription period. The court rejected the defendant's argument that the plaintiff unilaterally delayed the running of prescription,...

Court Disposition

Defendant's special plea of prescription dismissed; costs reserved for later determination.

Orders

  • The Defendant's special plea of prescription is dismissed.
  • Costs to stand over for later determination.