Steer Property Services CC t/a Steer & Co v Bruch N.O. and Others (18384/2019) [2022] ZAWCHC 171 (5 September 2022)

Steer Property Services CC t/a Steer & Co v Bruch N.O. and Others (18384/2019) [2022] ZAWCHC 171 (5 September 2022)

The court held that the exception was well founded. Clause 15 of the deed of sale created a contingent obligation by the third party in favour of the Trust only. The third and fourth defendants, by entering into a delegation of debt agreement with the plaintiff and the Trust, could not thereby create an obligation by the third party to indemnify them, as the third party was not privy to that agreement. The annexure to the third party notice failed to plead any contractual or legal basis for the contingent claim advanced by the third and fourth defendants against the third party. Accordingly, the exception was upheld.

Citation
[2022] ZAWCHC 171
Parties
Plaintiff: Steer Property Services CC t/a Steer & Co; Defendant: Rene Bruch N.O.; Defendant: Ralph Bruch N.O.; Defendant: Rene Bruch; Defendant: Ralph Bruch; Respondent: Caprinkles Property Group (Pty) Ltd
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
5 September 2022
Case Number
18384/2019
Procedural Posture
Civil Procedure / Exception to Third Party Notice
Outcome
Exception to the third party notice by the third and fourth defendants is upheld with costs.
Judges
A.G. Binns-Ward
Legal Topics
Delegation of Debt, Indemnity, Contractual Interpretation, Third Party Proceedings
Civil Procedure Commercial and Corporate Delegation of Debt Indemnity Contractual Interpretation Third Party Proceedings

Case Brief

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Parties

Steer Property Services CC t/a Steer & Co

Plaintiff

Rene Bruch N.O.

Defendant

Ralph Bruch N.O.

Defendant

Rene Bruch

Defendant

Ralph Bruch

Defendant

Caprinkles Property Group (Pty) Ltd

Respondent

Procedural Posture

Civil Procedure / Exception to Third Party Notice

Legal Issues

  1. 1 Whether the third party notice properly pleads a contractual or legal basis for indemnity against the third party in favour of the third and fourth defendants.
  2. 2 Whether clause 15 of the deed of sale creates an obligation by the third party to indemnify the third and fourth defendants for their assumed liability to the plaintiff.
  3. 3 Whether the delegation of debt agreement between the plaintiff and the third and fourth defendants can create an obligation enforceable against the third party.

Ratio Decidendi

The court held that the exception was well founded. Clause 15 of the deed of sale created a contingent obligation by the third party in favour of the Trust only. The third and fourth defendants, by entering into a delegation of debt agreement with the plaintiff and the Trust, could not thereby create an obligation by the third party to indemnify them, as the third party was not privy to that agreement. The annexure to the third party notice failed to plead any contractual or legal basis for the contingent claim advanced by the third and fourth defendants against the third party. Accordingly, the exception was upheld.

Court Disposition

Exception to the third party notice by the third and fourth defendants is upheld with costs.

Orders

  • The exception to the third party notice claim by the third and fourth defendants is upheld with costs.
  • The defendants are afforded 15 days within which to amend the annexure to the third party notice if so advised.