Siyakhula Sonke Empowerment Corporation (Pty) Ltd and Another v Vantage Goldfields SA (Pty) Ltd (2870/2021) [2022] ZAMPMBHC 94 (19 October 2022)

IN THE HIGH COURT OF SOUTH AFRICA

MPUMALANGA DIVISION, MBOMBELA (MAIN SEAT)

CASE NUMBER: 2870/2021

(1) REPORTABLE: YES/NO

(2) OF INTREST TO OTHER JUDGES: YES/NO

(3) REVISED

In the matter between:-

SIYAKHULA SONKE EMPOWERMENT

CORPORATION (PTY) LTD

First Applicant

FLAMING SILVER TRADING 373 (PTY) LTD

Second Applicant

and

VANTAGE GOLDFIELDS SA (PTY) LTD

Respondent

JUDGMENT

GREYLING-COETZER AJ

[1] A Sale of Shares Agreement was concluded, which was subject to three conditions precedent. Thereafter various addenda were concluded between the parties in relation to the said agreement.

[2] The first applicant (“SSEC”) made payment to the respondent (“Goldfields”) in amount of R1 million on behalf of the second applicant (“Flaming Silver”), on the strength of one of these addenda. The applicants now seek an order declaring that the Sale of Shares Agreement had lapsed, that two of the addenda is void ab initio and that the of R1 million be paid back.

[3] It is the aforesaid payment which is the subject matter of the current dispute between the parties. The applicants contend that the Sale of Shares Agreement had lapsed due to the non-fulfillment of conditions precedent, and that the payment was thus made indebiti.

[4] Goldfields opposes the application on the basis that the findings of an earlier court are res judicata and binding on Flaming Silver. Further on a proper interpretation of the Clause 3.2.4 of the third addendum Goldfields is not obliged to pay back the R1 million.

The factual background

[5] The facts of the matter are largely common cause.

[6] In November 2017 Flaming Silver concluded a written Sale of Shares Agreement with Goldfields for the purchase of its shareholding held in two subsidiary companies. The Sale of Shares Agreement was subject to the fulfillment of three conditions precedent, namely that:-

6.1 Flaming Silver is able, on/or before 31 January 2018 or such later date as agreed to by the parties in writing prior to the expiry thereof, to procure acceptable financing in the amount of R310 million (“financing condition”);

6.2 Flaming Silver paying an amount of R10 000 001.00 by 2 January 2018 into the trust account of attorneys pending the fulfilment of the conditions precedent (“payment condition”); and

6.3 all requisite regulatory approvals had to be obtained by no later than 31 January 2018, or as otherwise agreed to by the parties (“consent condition”).

[7] Clause 3.2 of the Sale of Shares Agreement further provided that:

“Should the Condition precedent referred to in clause 3.1.1 not be fulfilled on or before 31 January 2018, or any other Condition Precedent not having been met by the due date thereof and the period for fulfilment thereof not be extended by the Parties in writing prior to the expiry thereof, then this agreement shall lapse and be of no force and effect.”

[8] Thus, should the financing condition not be fulfilled on or before 31 January 2018 or the payment condition not be fulfilled by 02 January 2018 or the consent condition not be fulfilled by 31 January 2018 and the period for fulfillment not be extended 1) by the parties, 2) in writing, 3) prior to due date, the Sale of Shares Agreement shall lapse and be of no force and effect.

[9] On 21 December 2017 Flaming Silver and Goldfields concluded an addendum (“the first addendum”). The first addendum contained the following relevant provisions:-

9.1 Flaming Silver would provide interim funding in the amount of R2 million to Goldfields[1] by 21 December 2017. This was done on the understanding that such funds would be received as post-commencement funding in relation to those business rescue proceedings, alternatively as an interest free loan to Goldfields; and

9.2 the date for fulfillment of the financing- and consent conditions were amended by substituting the date of 31 January 2018 with 31 March 2018 in all relevant places.

[10] The first addendum also provides that subject to the terms of this addendum, the further terms of the Sale of Shares Agreement remain of full force and effect, and are not amended by the terms of the first addendum. Further, that the terms contained in clause 12 of the Sale of Shares Agreement would apply to the first addendum as if incorporated therein.

[11] The loan agreement contemplated by the first addendum was concluded on 31 December 2017 between SSEC and Goldfields. Finance in the amount of R310 million was secured on/or before 31 March 2018 through inter alia a loan from the Industrial Development Corporation of South Africa and a further subordinated loan agreement also from the Industrial

Development Corporation of South Africa.

[12] As at 2 January 2018 the payment condition had yet to be fulfilled. However, just short of two months later and on 29 March 2018 and after the due date for fulfillment, Flaming Silver made payment in the amount of R2 127 000.00. This was followed by two further payments on 31 March 2018 in the amount of R5 873 000.00 and R2 million, totaling R10 million.

[13] By 31 March 2018 the consent condition remained unfulfilled.

[14] On 3 May 2018, Flaming Silver and Goldfields concluded a further addendum to the Sale of Shares Agreement (“second addendum”). In terms of the second addendum:-

14.1 the finance- and payment conditions were, deemed to have been fulfilled by no later than 31 March 2018; and

14.2 the payment condition was deemed to have been fulfilled by the due date for fulfillment thereof (2 January 2018), and to the extent required, Goldfields waived such condition precedent. The former was made subject to Flaming Silver complying with clause 4.4 of the second addendum.

14.2.1. Clause 4.4 provided that the purchase price then held in the trust account of Martins Weir-Smith Attorneys would be paid to Goldfields upon successful completion of the Section 11 transfer and any other regulatory approval that may be required in terms of the Sale of Shares Agreement, as determined by the parties.

14.3 The date for the fulfillment of the consent condition was again extended to 30 July 2018.

[15] On 2 August 2018 Flaming Silver and Goldfields concluded a further addendum to the Sale of Shares Agreement (“third addendum”). SSEC was an additional party to this third addendum, intervening in specific matters.

[16] In terms of the third addendum:-

16.1 the date for fulfillment of the consent condition was again extended to 31 October 2018;

16.2 Clause 6 of the Sale of Shares Agreement, pertaining to the manner of payment of the purchase price, was deleted, and it was agreed that the amount deposited would be repaid to Flaming Silver;

16.3 against written proof that the application in terms of Section 11 of the Mineral and Petroleum Resources Development Act, 28 of 2022, in respect of the consent condition had been submitted, Flaming Silver would:-

16.3.1. pay a portion of the amount repaid to it, i.e., R1 million to the credit of Goldfields on 3 August 2018, for the purpose of Flaming Silver obtaining post-commencement funding from SSEC in terms of a loan agreement; and

16.3.2. pay an amount of R1 million to Goldfields on 3 August 2018 as a non-refundable prepayment of the purchase price, and not subject to any conditions precedent, save for the delivery of the application in terms of Section 11, which amount would be set off against the balance of the purchase price;[2]

16.4 SSEC bound itself as guarantor in favour of Goldfields for due performance by Flaming Silver of its obligations.

[17] On 3 August 2018 the Section 11 application in respect of the consent condition was approved.

[18] On 8 August 2018, SSEC made payment to Goldfields on behalf of Flaming Silver, and in accordance with the third addendum, in the amount of R1 million.

[19] On 31 October 2018 the parties entered into a final addendum (“fourth addendum”), the terms of which are not relevant for purposes of the current dispute .

[20] On 17 July 2019 and per the judgment of Roelofse AJ under Case number 858/2019 (“case 858/2019”) the fourth addendum was found to be technically defective and it was ordered that the purported ratification of the signing of the fourth addendum to the Sale of Shares of Agreement of 1 November 2017 was null and void.

[21] Case 858/2019 was an application launched by Flaming Silver for specific performance of the Sale of Shares Agreement by Goldfields. A former director of Flaming Silver Mr Dippenaar intervened and in terms of a counter application sought that the resolution dated 12 November 2018, by the board of directors of Flaming Silver to ratify the signing of the fourth addendum to the Sale of Shares Agreement be declared null and void. In the alternative it was sought that the resolution dated 31 October 2018 by the board of directors of Flaming Silver to ratify the signing of the fourth addendum to the Sale of Shares Agreement be declared null and void.

The parties competing contentions

[22] It is contended on behalf of the applicants that on the strength of clause 3.2 of the Sale of Shares Agreement, the non-fulfillment of any of the conditions precedent would render the Sale of Shares Agreement to be of no force or effect.

[23] As at 2 January 2018 the payment condition had not been fulfilled. The applicants therefore contend that the Sale of Shares Agreement lapsed on 3 January 2018.

[24] In the alternative it is submitted that if the Sale of Shares Agreement did not lapse on 2 January 2018 as a result of the non-fulfillment of the payment condition, then the Sale of Shares Agreement lapsed on 1 April 2018 due to the non-fulfillment of the consent condition, which ought to have been fulfilled on 31 March 2018 in terms of the first addendum.

[25] In the further alternative, the Sale of Shares Agreement lapsed on 31 of July 2018 due to the non-fulfillment of the consent condition in terms of the second addendum.

[26] Flaming Silver contend that the second- and third addenda are void ab initio, and as a result of no force and effect. Consequentially the amount of R1 million, which was paid by SSEC, after the conclusion of the void third addendum for the non-existent obligation to make part-payment of the purchase price, stands to be repaid with interest.

[27] It was submitted that the intention of the parties ex facie the Sale of Shares Agreement was clear, being that should Flaming Silver as the purchaser be unable to procure financing, make payment of the purchase price to be held in trust and to obtain the requisite regulatory approvals, then such non-fulfillment would render that terms of the Sale of Shares Agreement unenforceable and of no force and effect.

[28] It was also contended that it is plain that the conditions precedent was not inserted for the benefit of only one of the parties, as financing would be necessary for the companies’ business to continue. Payment would be made into trust in order to secure the purchase price. Repayment if the Sale of Shares Agreement lapsed and the regulatory approval would be required for the Sale of Shares Agreement to proceed.

[29] It was submitted that the “deemed fulfilment” and purported waiver agreed to in the second addendum, could not revive the Sale of Shares Agreement, nor was there any assertion by the parties that they took cognisance of the lapsing of the Sale of Shares Agreement and revived same, without such conditions being applicable to the new agreement. According to the applicants the parties were oblivious to the effect of the non-fulfillment of the conditions precedent.

[30] It was contended that as there was no Sale of Shares Agreement capable of being amended at the time when the addenda were concluded, the addenda are invalid and void ab initio, as the validity of the addenda would wholly depend upon the validity of the Sale of Shares Agreement which it intended to vary or amend.

[31] In respect of the payment relief, it was submitted on behalf of the applicant that it is common cause that payment was made by the SSEC to Goldfields in terms of clause 4.3.2 of the void third addendum. SSEC bound itself in favour of Goldfields as guarantor for each of the performances to be undertaken by Flaming Silver.

[32] The obligation to make payment of the R1 million was dependent upon the existence of a valid obligation to make payment of the purchase price, and no such obligation existed at that point at time.

[33] Goldfields contend that the finding by the court under case number 858/2019 is res judicata and binding on Flaming Silver, as the validity of the Sale of Shares Agreement, in that context, and the addenda were dealt with in Case 858/2019. Although not appearing from the papers before court it was also submitted that it bound SSEC who can be regarded as a privy of Flaming Silver. According to Goldfields it was found in case 858/2019 that the Sale of Shares Agreement and also the first- to third addenda were valid and binding, and due to the failure of the fourth addendum, the Sale of Shares Agreement lapsed on 31 October 2018.

[34] It was submitted on behalf of Goldfields that the validity of the Sale of Shares Agreement and the addenda concluded in respect thereof were essential elements of the judgment in case 858/2019. In this respect the applicant counter argued that in the court’s own words in case number 858/2019, the issues were “whether the fourth addendum extended the fulfillment of condition clause 3.1.3 of the principal agreement” and “central to the lawfulness of the fourth addendum is the issue of the purported ratification of the entering into of the fourth addendum by Mr Arendse”.

[35] These issues were raised by an intervening party, Mr Dippenaar, who sought an order declaring the resolution ratifying the fourth addendum to be null and void, and that the Sale of Shares Agreement had lapsed as a result thereof.

[36] Further, that the order made by the court was that the purported ratification of the signing of the fourth addendum to the Sale of Shares Agreement of 1 November 2017, is declared null and void.

[37] It was submitted that Goldfields is unable to rely on the issue of estoppel, as it was not raised in the answering affidavit, nor was any case made out in the answering affidavit for the relaxation of the requirement of res judicata in order for issue of estoppel to apply. Considerations of equity and fairness militate against the relaxation, and as SSEC was not a party to the previous proceedings under case 858/2019, it would be grossly inadequate and unfair to SSEC for the requirements of the defense of res judicata to be relaxed in favour of Goldfields.

[38] Should the court permit the relaxation, Goldfields had still failed to satisfy the requirements, as the parties were not the same, nor was the same issues of fact and/or law an essential element of the judgment relied on by Goldfields.

[39] Goldfields argued that upon a proper interpretation of clause 3.2.4 of the third addendum, Goldfields is not obliged to repay the amount of R1 million. Clause 4.3.2 provided that the payment would be a non-refundable prepayment of the purchase price, and would not be subject to any conditions precedent, save for the delivery of the Section 11 application, i.e., the consent condition.

[40] It is common cause that the Section 11 application was delivered on 3 August 2018, therefore properly interpreted and having regard to the context and the factual matrix the obligation that rested on Flaming Silver to pay Goldfields was a self-standing obligation not subject to the fulfillment of any further condition precedent, other than the consent condition. Therefore, the payment was non-refundable because Goldfields required the money as working capital to assist with its cash-flow constraints caused by the delay in the funding promised by Flaming Silver.

[41] In respect of the argument that clause 3.4.2 of the third addendum was a self-standing obligation, the applicants submit that the wording of the addendum speaks to the contrary.

Res Judicata

[42] The requirements of res judicata is trite and need no more than a brief mention. For application, it should be shown that the proceedings are in respect of a dispute

between the same parties, on the same cause of action and for the same relief, as has previously been dispositively adjudicated. The onus befalling Goldfields to allege and prove the former in order to establish the defense of res judicata.[3]

[43] On the common cause facts, it is clear that the judgment under case 858/2019 was by a competent court and a final decision in respect of the issues before it. The parties here and in case 858/2019 are similar but not the same. Goldfields submitted that on the strength

of that held in Royal Sechaba Holdings (Pty) Ltd v Coote and Another 2014 (5) SA 562 (SCA)[4] SCCE is bound by the finding in case 858/2019 as they are ‘persons who are in law identified with those who were parties to the proceedings.’ And the issues are the same. For the first time and in the heads of argument Goldfields places reliance on issue estoppel, submitting that the validity of the Sale of Shares Agreement and the addenda concluded in respect thereof were essential elements of the judgment in case 858/2019.

[44] Goldfields relies on paragraphs [48] and [58] of the judgment in case 858/2019 to demonstrate that the court was required to deal with the validity of the Sale of Shares Agreement, and the court found the Sale of Shares Agreement and the first- to third addenda to be valid and binding. These paragraphs read as follows:-

“[48] I find that it has been established that: the main agreement was entered into by Flaming Silver and Goldfields; the main agreement was subject to the fulfillment of conditions precedent; if the conditions precedent were not fulfilled by their due date, or the period for their fulfillment not be extended by the parties in writing, the principal agreement would lapse and be of no force and effect; the conditions in clauses 3.1.1 and 3.1.2 of the principal agreement were deemed to be fulfilled; only the conditions in clause 3.1.3 of the principal agreement (‘condition 3.1.3’) was extended to 31 October 2018; Mr Arendse signed the fourth addendum on 31 October 2018; the fourth addendum negated condition 3.1.3; in signing the resolution, Mr Arendse acted without authority; the round-robin discussion and agreement on 31 October 2018 between Mr Arendse, Mr Matzuri and Mr Moabelo ratify the fourth addendum was not a unanimous board decision; Mr Arendse, Mr Matzuri and Mr Moabelo signed the resolution; the resolution was backdated; the resolution was signed on 1 November 2018; and, between the transmission of annexure ‘FD12’

and the adopting of the resolution, there was no further communication with Mr Dippenaar over the resolution.…

[58] The meeting of 1 November 2018 could not validity proceed and no resolution could be voted upon for there is no evidence of any notice of the meeting as required in section 73(4)(b) of the Act. Flaming Silver’s Board was therefore not properly constituted due to the non-compliance with the provisions of section 73(4)(b) of the Act, at least in respect of the notice that was required to be given by Mr Dippenaar. Consequentially, the purported resolution to ratify the entering into of the addendum is null and void and of no consequence. Therefore, the fourth addendum was not lawfully entered into and of no moment. As a result, the main agreement lapsed due to no fulfillment of suspensive condition 3.1.3.”

[45] In considering the judgment the following is clear, as herein, the majority of the facts in case 858/2019 was common cause. The judgment commences with a statement about the dispute between the applicant, being Flaming Silver, the first respondent being Goldfields and the fifth respondent, Mr Dippenaar, over a written Sale of Shares Agreement that was entered into by Goldfields as the seller and Flaming Silver as the purchaser.

[46] The relief sought by Flaming Silver was for specific performance, Mr Dippenaar intervened and counter applied for the resolution dated 12 November 2018, alternatively the resolution dated 21 October 2018, by the board of directors of Flaming Silver to ratify the signing of the fourth addendum to the Sale of Shares Agreement is null and void.

[47] The court defines the issues before it in paragraph [42]

“… the first and paramount issue I must decide is whether the fourth addendum extended the fulfillment of condition 3.1.3 of the principal

agreement (‘condition 3.1.3’). If the fourth addendum did not extend the fulfilment of the condition 3.1.3, it is the end of the matter for Flaming Silver because the principal agreement will then have lapsed. Flaming Silver will not be entitled to specific performance in terms of the principal agreement (or the fourth addendum). If I find that the fourth addendum is null and void as a result of the defect in the conclusion of the fourth addendum, then, depending upon the nature of the defect, Mr Dippenaar (that being the fifth respondent) may be entitled to prayer 3.1(a).

[43] Central to the lawfulness of the fourth addendum was the issue of the purported ratification of the entering into of the fourth addendum...”

[48] The court then proceeds to hold that having made aforesaid findings with reference to that set out in paragraph 48 as quoted above, what remains is that it had to consider the status of the resolution for if the resolution was resolution was invalid, the fourth addendum was unlawful and the Sale of Shares Agreement had lapsed and is of no force and effect due to the non-fulfillment of the condition 3.1.3 of the Sale of Shares Agreement.

[49] The court found that the fourth addendum was not lawfully entered into and of ‘no moment’. As a result, the principal agreement lapsed due to the non-fulfillment of the suspensive condition 3.1.3, being the consent condition.[5]

[50] The court ordered that:

“2. The purported ratification of the signing of the fourth addendum to the Sale of Shares Agreement of 1 November 2017 is declared null and void.”

consequentially dismissing the relief sought by Flaming Silver.

[51] The parties in case 858/2019 are not the same as in this application. There Flaming Silver was the applicant with Goldfields, Hogan Lovells (South Africa) Inc, Mr Devereoux N.O., Mr Terblanche N.O. and Mr Dippenaar as the respondents. SSEC was not a party. The relationship between Flaming Silver and SSEC is distinguishable from the type described in Royal Sechaba Holdings (Pty) Ltd v Coote and Another (supra).

[52] The challenge in respect of the ratification of the board decision was mounted by Mr Dippenaar. Consequential to this was the finding that fourth addendum is null and void and Sale of Shares Agreement had lapsed. The issues identified and pronounced upon in case 858/2019, was the validity of the ratification of the resolution to conclude the fourth addendum, they are not the same ‘cause of action’. It was a different issue and different relief sought.

[53] Paragraph [48] of the judgment was not only obiter but the used of the word “I find that it has been established” is suggestive of a finding in the true sense. However, on a proper consideration of the whole paragraph, judgment, considering the context therein, issues identified and what was common cause at the very least line 1 to 9, amount to a mere recital of the common cause facts leading up to the conclusion of the fourth addendum.

[54] The court was not called upon to make a finding as to whether the conditions precedent was fulfilled by their due dates or the period of their fulfillment not being extended timeously, whether the second and third addenda were valid or had caused the Sale of Shares Agreement to lapse.

[55] Issue estoppel is a variant of the defense of res judicata and finds application in appropriate cases where the common law requirement of the exceptio res judicata be relaxed. As explained in Royal Sechaba Holdings (Pty) Ltd v Coote and Another (supra):-

“…‘issue estoppel’ is a convenient description of instances where a party may succeed despite the fact that the classic requirements for res judicata have not been complied with because the same relief is not claimed, or the cause of action differs, in the two cases in question…”[6]

[56] If circumstances justify the relaxation of the requirements for res judicata that which remain are that the parties must be the same and that the same issue must arise. It was plainly explained in Smith v Porritt and Others 2008 (6) SA 303 (SCA) where it was stated that:

“Broadly stated, the latter involves an inquiry whether an issue of fact or law was an essential element of the judgment on which reliance is placed.”[7]

[57] Each case stands to be adjudicated depending on its own facts, and relevant considerations will include questions of equity and

fairness, not only to the parties themselves but also to others.[8]

[58] Goldfields failed to place any circumstances before this court to justify relaxation of the requirement. For as far as it can be contended that the circumstances relied on need not be expressly set out, I am for the reasons set out above unpersuaded that the validity of the Sale of Shares Agreement and the Addenda more specifically the second and third addenda were essential elements of the judgment under case 858/2019.

The first addendum

[59] The first addendum concluded in line with the prescripts of clause 3.2 of the Sale of Shares Agreement more specifically before the expiry of the due date for the conditions precedent.

[60] As at the date of conclusion of the first addendum, being 21 December 2017, all three conditions still had to be met, and the specific time period for fulfillment had not passed. The finance condition could still be fulfilled on/or before 31 January 2018, the payment condition could still be fulfilled on/or before 2 January 2018 and the consent condition could still be fulfilled on/or before 31 January 2018.

[61] The first addendum lawfully extended the period for fulfilment of the finance- and consent conditions to 31 March 2018, leaving the payment condition unaltered and due by 2 January 2018.

Non-fulfilment of payment- and consent condition

[62] As at 2 January 2018 the payment condition had not been fulfilled.

[63] When a contract of sale is made subject to a true suspensive condition, there exists no contract of sale unless and until the suspensive

condition is fulfilled. Although the obligation is created by the conclusion of the contract, it is suspended pending fulfillment of the suspensive condition. Obligations cannot be performed or enforced until the suspensive condition is fulfilled.[9] There is no dispute as to whether the conditions precedent where true conditions precedent I therefore accept that they are on the basis relied on by the applicants.

[64] Non-fulfillment of suspensive conditions normally renders a contract void.[10] In Africast (Pty) Limited v Pangbourne Properties Limited 2014 JDR 0616 (SCA) it was held that if the condition is not fulfilled, then no contact came into existence. That being the position ex lege but here Flaming Silver and Goldfields expressly catered for what would happen in the instance of non-fulfillment of one for the

conditions precedent per clause 3.2.

[65] It’s unavoidable that the Sale of Share Agreement lapsed on 3 January 2018 due to the non-fulfilment of the payment condition, and is of no force and effect.

[66] Having found that the Sale of Shares Agreement lapsed, the addenda concluded pursuant thereto are void ab initio. However, it is necessary to deal with each of them in light of the arguments raised by Goldfields.

The second addendum

[67] The second addendum was concluded on 3 May 2018. This was 4 months after the period for fulfillment of the payment condition expired on 2 January 2018 and approximately 1 months after the period for fulfillment of the consent condition expired on 31 March 2018.

[68] The second addendum purported to amend the Sale of Shares Agreement and the first addendum after the fact. There was at that point in time no Sale of Shares Agreement to amend.

[69] The second addendum provides that the finance- and payment conditions are “deemed to have been fulfilled by no later than 31 March 2018”, and further to the extent required, that Goldfields waived compliance with clause 6.1 of the Sale of Shares Agreement, subject to Flaming Silver complying with clause 4.4 of the second addendum.[11]

[70] It is common cause that the finance condition had been fulfilled by 31 March 2018. Payment was made in amount of R 10 million on 31 March 2018 in ostensible fulfillment of the payment conditions, however the consent condition remained unfulfilled.

Does the second addendum revive the lapsed Sale of Shares agreement?

[71] Waiver is not interchangeable with revival. In Park 2000 Development (Pty) v Page (2011) JOL 28327 SCA[12] it was reasoned that:-

“A clause or condition that is exclusively for the benefit of one party may be waived by that party. The condition contained in the first part may be waived by that party. The condition contained in the first part of clause 10 is obviously for the sole benefit of the purchaser. Although the seller may also have an interest in the fulfillment or non- fulfillment of the condition and the time imposed, the benefit of the “substance” of the condition in the first part of clause 10 is solely for the purchaser. The Seller’s interest is protected by the second part of clause 10. Since it is for his sole benefit, the condition may be waived by the purchaser, thereby rendering the agreement unconditional. But any waiver must take place before the time provided for in the agreement, in this case within seven days of signature of the agreement (in the present matter within 30 days from the agreement), because the agreement would otherwise have lapsed on non-fulfillment of the condition. (own emphasis)

[72] A waiver in itself cannot revive a lapsed agreement. There can only be a waiver of a right which is existent at that point in time the Sale of Shares Agreement had lapsed and no right was existent.[13]

[73] Similarly, there cannot be “deemed fulfillment” of a condition where said condition is not existent anymore, for the agreement wherein the condition was contained has lapsed. Once an agreement has lapsed, the parties are free to conclude a new agreement with amended terms.

[74] Goldfields contends that the second addendum (and third addendum) was signed whilst the deponent to the answering affidavit was painfully aware that the Sale of Shares Agreement had lapsed. As such the second addendum (and third addendum) was signed with the intention to revive the lapsed Sale of Share Agreement. To find that this could have been so requires one to ignore the language of the addendum in its totality. I find it to be pulpable implausible.

[75] Moreover, such a contention is irreconcilable with what Goldfields argue in respect of clause 5 to the second addendum and that said clause gave binding force and validity to the lapsed Sale of Shares Agreement. Clause 5 records that all the other terms of the Sale of Shares Agreement and the First Addendum shall remain in full force and effect and the parties remain bound thereby. The logic escapes me that a party seek to ensure a lapsed agreement remains in full force by the inclusion of Clause 5, being acutely aware that the Sale of Shares Agreement had lapsed as contended by Goldfields, but fails to acknowledge it in the memorandum.

[76] Had Goldfields been as painfully aware of the fact that the Sale of Share Agreement had lapse it would have bene expected of them to raise it as a defence against the specific performance claim in case 858/2019.

[77] The second addendum is silent on any acknowledgement that the Sale of Shares Agreement had lapsed, or that the second addendum is an express revival of the Sale of Shares Agreement, excluding the conditions precedent.[14]

[78] The second addendum is invalid and void ab initio, as there was no Sale of Shares Agreement capable of being amended at the time when the second addendum was concluded, the validity of the addendum is wholly dependent upon the validity of the Sale of Shares Agreement, which it intended to vary and amend. Moreover, the purported “deemed fulfillment” and waiver of the conditions precedent, could and did not revive the lapsed Sale of Shares Agreement.

[79] The third addendum suffer the same consequence, but it is necessary to deal with the argument raised by Goldfields to the extent that properly interpreted Clause 4.3.2 of the third addendum was a self-standing obligation.

The third addendum

[80] The third addendum was concluded on 2 August 2018. Assuming for the present purpose that the second addendum extended the period for fulfillment of the consent condition to 30 July 2018, the third addendum was again concluded after the fact.

[81] The third addendum purported to amend the Sale of Shares Agreement, First and Second Addendum. The relevant provision for the current

consideration being that Flaming Silver was to pay an amount of R1 million to Goldfields on 3 August 2018 as a non-refundable prepayment

of the purchase price, and not subject to any conditions precedent, save for the delivery of the application in terms of Section 11, which amount would be set off against the balance of the purchase price.[15] SSEC bound itself per the third addendum as guarantor in favour of Goldfields for due performance by Flaming Silver of its obligations.

[82] Similar to the second addendum, the third addendum contained a clause providing that all the other terms of the Sale of Shares Agreement and the First Addendum shall remain in full force and effect and the parties remain bound thereby. Goldfields also raised the fact that it was aware of the lapsed agreement as at the time of signing the third addendum. Which was so signed with intention to revive. For the reasons stated in respect of the second addendum, I find no merits in these contentions in respect of the third addendum.

[83] Goldfields argues that on a proper interpretation of clause 4.3.2 of the third addendum, and having regard to the context and factual matrix, the obligation upon Flaming Silver to pay R1 million as a non-refundable prepayment of the purchase price (which payment was not subject to any conditions precedent, save for delivery of the Section 11 application), and which amount would be set off against the balance of the purchase price on the completion date, amounts to a self-standing obligation.

[84] The applicants in response confirm that having regard to clause 4.3.2, it appears to be correct that the payment would be non-refundable. However, such provision is unenforceable, considering that the sale never materialized and that the allegations in respect of context and the factual matrix are in any event irrelevant to the issue for determination. This is so, as any contention that clause 4.3.2 of the addendum can be held to be valid and enforceable, notwithstanding the lapsing of the Sale of Shares Agreement before the conclusion of such addendum, is untenable. Clause 4.3.2 cannot survive or be regarded as a self-standing obligation.

[85] Whether the payment was non-refundability is not in issue. What remains is whether said clause 4.3.2 constitutes a self-standing obligation.

[86] In University of South Africa v Auckland Park Theological Seminary and Another 2021 (6) SA 1 (CC) the Constitutional Court held that the approach which stands to be adopted when interpreting any contractual provision (not

only those that were unclear or ambiguous), was one which is holistic in simultaneously considering the text, context and purpose of the provision concerned. Thus, context must be considered when interpreting any contractual provision.

[87] The provisions set out in the third addendum, more particularly clause 4.3.2, the document as a whole, the circumstances that gave rise to this third addendum, the language used, the context in which the provision appears, the purpose for which the third addendum was prepared and that which was within the knowledge of the preparers, is at odds with a finding that Clause 4.3.2 it a self-standing obligation. Nor can it be found that it was intended survived or for that matter revive the lapse of the Sale of Shares Agreement and the voidness of the second and third addendum for that matter.

[88] The interpretation contended for by Goldfields borders on probing the import of a tacit term, with the result that clause 4.3.2 can be regarded self-standing. In doing so, Goldfields is attempting to avoid the test for importing a tacit term. It is trite that context cannot be used to read in a term which is not contained in an agreement.

[89] Clause 4.3.2 is inextricably linked to the Sale of Shares Agreement, it provides for payment of a part of the purchase price, a purchase price which would not have been paid had it not been for obtaining shares. Without the Sale of Shares Agreement what would the payment be for as Flaming Silver absent the Sale of Shares agreement had not entitlement to the shares. Even being non-refundable still does not justify the retention in circumstances where the that for which is was paid did not exist at the time of conclusion of the third addendum and payment.

Payment Relief

[90] The applicants base the claim for repayment on the condictio indebiti. In order for the applicants to succeed on this basis, the applicants bear the onus to establish that, Goldfields was enrichment, which enrichment is at the expense of SSEC, alternatively Flaming Silver,SSEC alternatively

Flaming Silver, was impoverished, the enrichment was unjustified and that the money was paid without being due and payment was made in the mistaken belief that it was due, and that the mistake was excusable.

[91] Having found that the Sale of Shares Agreement lapsed, was void and of no force and effect, the second- and third addenda being void ab initio, and that clause 4.3.2 does not constitute a self-standing obligation, the applicants would be entitled to repayment.

[92] Save to dispute that a case has been made out for the payment of the amount of R1 million to SSEC, no further challenge is put up in respect of the payment relief. Only argument was advanced in this respect and to the extent that payment of the R1 million was made on 8 August 2018 by SSEC on behalf of Flaming Silver to Goldfields. According to Goldfields, SSEC will not succeed if it was not impoverished.[16] As SSEC was not liable in terms of the third addendum to pay Goldfields, so the argument went, SSEC was not impoverished at the expense of Goldfields and therefore not entitled to repayment.

[93] In Melamed and Another v B P Southern Africa (Pty) Ltd 2000 2 SA 614 (WLD) 625D-G/H Blieden J said:

“A suspensive condition is a condition suspending the operation of the obligations from the contract, pending the occurrence or non occurrence of a particular specified event (Design and Planning Service v Kruger 1974 (1) SA 689 (T) at 695C-D; Thiart v Kraukamp 1967 (3) SA 219 (T) at 225A-C). The agreement under consideration is subject to a suspensive condition. This entails that the agreement would be discharged ipso iure on non fulfilment of the condition (Dirk Fourie Trust v Gerber 1986 (1) SA 763 (A) at 773F-G; Design and Planning Service v Kruger (supra at 697G-H)). In Tuckers Land and Development Corporation (Pty) Ltd v Strydom (supra at 23H) Joubert JA said:

‘By nie-vervulling van die opskortende voorwaarde, wat nie aan die toedoen van die partye te wyte is nie, veral die koop/verkoop.’

Where a suspensive condition is not fulfilled, a party who remains owner of the property sold may rely on his remedies qua owner and claim eviction of the party in possession (for example Meyer v Barnardo and Another 1984 (2) SA 580 (N)). Where there has been performance pursuant to a contract subject to a suspensive condition pendente conditione the parties must restore that which they have received pendente conditione or conditione extincta. The authorities seem to indicate that restoration can be claimed with one or other of the enrichment remedies.”

[94] SSCE bound itself in terms of the third addendum as guarantor for each of the performances to be undertaken by the second applicant.

[95] Considering the relief sought by the applicants against the aforementioned, Goldfields has been enriched, it received R1 million without any obligation existing in re the shares. The enrichment was at the expense of SSEC and Flaming Silver, the former’s assets decreasing and liabilities increasing. The latter gaining no entitlement to the shares for want of the lapsed Sale of Shares Agreement.

[96] In turn, and considering the undisputed facts, SSEC having bound itself for due performance of Flaming Silver, has been impoverished it’s assets decreasing and liabilities increasing in circumstances where payment was made without any legal ground (clause 6.2 of the third addendum not being in existence) and without it being due (clause 3.4.3 of the third addendum not being in existence as the third addendum was void and the Sale of Shares Agreement having lapsed and first and second addenda being void).

[97] Any obligation that might have existed and which was created by the Sale of Shares agreement as amended, second and third addenda, in respect of Flaming Silver and any obligation that might have existed in respect of the third addendum in respect of SSCE had not come into existence due to the lapse of the Sale of Shares Agreement or was void. The payment was therefore made in the mistaken but excusable belief that it was due.[17]

[98] For the reasons set out above, I am satisfied that the applicants established that the Sale of Shares Agreement lapsed on 3 January 2018. As a consequence, the second- and third addenda are void ab initio. Further that SSEC has established its claim for the repayment of the R1 million.

[99] I see no reason why the general principle, that cost follow the event should not apply.

[100] By reason of aforementioned, I grant the following order:-

1. It is declared that the Sale of Shares Agreement entered into by and between second applicant and the respondent on 1 November 2017, as amended on 21 December 2017, lapsed on 3 January 2018, and is accordingly void and of no force and effect.

2. It is declared that the second- and third addenda to the Sale of Shares Agreement, purportedly concluded on 3 May 2018 and 2 August

2018 respectively, are void ab initio and their terms of no force or effect.

3. The respondent is ordered to make payment of R1 million to the first applicant, together with interest calculated at the applicable

prescribed rate per annum as from 8 August 2018 to date of final payment.

4. The Respondent to pay the cost of this application.

DATE OF HEARING: 19 July 2022

DATE OF JUDGMENT: 19 October 2022

FOR THE APPLICANTS: Adv Boonzaaier

Instructed by Mouton Inc

c/o Du Toit Smuts Attorneys

E-mail: bm@moutoninc.co.za

& tboshoff@dtsmp.co.za

FOR THE RESPONDENT: Adv Stroop SC

Instructed by Barnard Inc

c/o A de Kock Attorneys

E-mail: elloise@barnardinc.co.za

& andries@barnardinc.co.z

& anneline@adkattorneys.co.za

[1] Or the other parties mentioned in clause 3.2

[2] Clause 4.3.2

[3] MV Silvergate;Tradax Ocean Transport SA v MV Silvergate properly described as MV Astyanax and Others 1999 (4) SA 405 (SCA)

[4] Par [17]

[5] Par [58]

[6] Royal Sechaba Holdings (Pty) Ltd v Coote and Another 2014 (5) SA 562 (SCA) at par [12]

[7] Smith v Porritt and Others 2008 (6) SA 303 (SCA) at par [10]

[8] Smith v Porritt and Others 2008 (6) SA 303 (SCA) at par [10]

[9] Tamarillo (Pty) Ltd v B N Aitken (Pty) Ltd 1982 (1) SA 398 (A) at 432; Resisto Dairy (Pty) Ltd v Auto Protection Insurance Co Ltd 1963 (1) SA 632 (A) at 644; Melamed v BP Southern Africa Development Corporation (Pty) Ltd 2000 (2) SA 614 (W) at 625-6; Command Protection Services (Gauteng) (Pty) Ltd t/a Maxi Security v South African Post Office Ltd 2013 (2) SA 133 (SCA) at par [10]

[10] Command Protection Services (supra); See also Africast (Pty) Limited v Pangbourne Properties Limited 2014 JDR 0616 (SCA)

[11] Clause 4.4 provided for the purchase price held in the trust account of Martins Weir-Smith Attorneys to be paid to Goldfields upon successful completion of the Section 11 transfer and any other regulatory approvals that may have been required in terms of the Sale of Shares Agreement

[12] Par [11]

[13] Fairoaks Investment Holdings (Pty) Ltd. and Another v Oliver and Others 2008 (4) SA 302 (SCA)

[14] Benkenstein v Neisius and Others 1997 (4) SA 835C where it refers to Cronjé v Tucker’s Land and Development Corporation (Pty) Ltd 1981 (1) SA 256 (W); See also Pangbourne v Basinview (381/10) [2011] ZASCA (17 March 2011).

[15] Clause 4.3.2

[16] McCarthy Retail Ltd v Short Distance Carriers CC 2001 (3) SA 482 (SCA) at par [19]

[17] Bowman, De Wet and Du Plessis NNO and Others v Fidelity Bank Ltd 1997 (2) SA 35 (A)