Tatrim CC v Spenmac (Pty) Ltd (1622/2011) [2013] ZAECPEHC 5 (31 January 2013)

Tatrim CC v Spenmac (Pty) Ltd (1622/2011) [2013] ZAECPEHC 5 (31 January 2013)

The court found that the defendant, through its representative, made representations to the plaintiff that the scheme comprised only two sections and that the owner of section 1 retained a right of veto over any subdivision of section 2. These representations, though not fraudulent, were made without knowledge of the true facts, as the defendant had previously consented to the subdivision and section 2 had already been subdivided into 110 units. The plaintiff entered into the agreement under the mistaken belief that it was acquiring section 1 together with the right of veto, a mistake induced by the defendant's innocent misrepresentation. The exemption clause in the contract did not...

Citation
[2013] ZAECPEHC 5
Parties
Plaintiff: Tatrim CC; Defendant: Spenmac (Pty) Ltd
Court
Eastern Cape High Court, Port Elizabeth
Jurisdiction
South Africa
Judgment Date
31 January 2013
Case Number
1622/2011
Procedural Posture
Civil Trial / Judgment After Trial
Outcome
Plaintiff's claim succeeds; the agreement of sale is void for lack of consensus.
Judges
GG Goosen
Legal Topics
Innocent Misrepresentation, Unilateral Mistake, Lack of Consensus, Sectional Titles Act, Contract Rescission
Land and Property Commercial and Corporate Innocent Misrepresentation Unilateral Mistake Lack of Consensus Sectional Titles Act Contract Rescission

Case Brief

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Parties

Tatrim CC

Plaintiff

Spenmac (Pty) Ltd

Defendant

Procedural Posture

Civil Trial / Judgment After Trial

Legal Issues

  1. 1 Whether the defendant made misrepresentations regarding the subdivision and veto rights over section 2 of the sectional title scheme.
  2. 2 Whether the plaintiff was induced into the agreement by a material misrepresentation or failure to disclose material facts.
  3. 3 Whether the contract is void due to lack of consensus arising from mutual mistake as to the subject matter.

Ratio Decidendi

The court found that the defendant, through its representative, made representations to the plaintiff that the scheme comprised only two sections and that the owner of section 1 retained a right of veto over any subdivision of section 2. These representations, though not fraudulent, were made without knowledge of the true facts, as the defendant had previously consented to the subdivision and section 2 had already been subdivided into 110 units. The plaintiff entered into the agreement under the mistaken belief that it was acquiring section 1 together with the right of veto, a mistake induced by the defendant's innocent misrepresentation. The exemption clause in the contract did not...

Court Disposition

Plaintiff's claim succeeds; the agreement of sale is void for lack of consensus.

Orders

  • The agreement of sale concluded between the plaintiff and defendant in respect of section 1 Park Towers and dated 8 October 2010 is declared void for lack of consensus.
  • The defendant is directed to pay to the plaintiff the sum of R788,157.89 together with interest thereon at the legal rate of 15% per annum a tempore morae to date of payment.