Torre v Kriess and Others (1655/04) [2005] ZAGPHC 28 (14 March 2005)

Torre v Kriess and Others (1655/04) [2005] ZAGPHC 28 (14 March 2005)

The court found that a binding contract was concluded between the applicant and the first respondent for the transfer of the membership interest in the close corporation. The addition of 'Ohne Rechtsverbindlichkeit' on the signature pages did not negate the effect of the manuscript note 'Rechtsverbindlich: ab 09.05.2003' on the front page, which indicated that the agreement would become legally binding from 9 May 2003 unless cancelled before that date. The subsequent conduct of the parties, including the payment and receipt of R150,000, corroborated the existence of the contract. The respondents failed to prove that a valid cancellation notice was delivered to the applicant before 9 May...

Citation
[2005] ZAGPHC 28
Parties
Applicant: Theodore Torre; Respondent: Walter Jürgen Kreiss; Respondent: Hein Kreiss; Respondent: Mfuleni Crocodile Farm CC; Respondent: Registrar of Companies & Close Corporations
Court
High Courts - Gauteng
Jurisdiction
South Africa
Judgment Date
14 March 2005
Case Number
1655/04
Procedural Posture
Civil Application / Final Relief on Motion
Outcome
Application granted. The contract for transfer of membership interest is enforceable.
Judges
JCW van Rooyen
Legal Topics
Contract Formation, Counter Offer, Interpretation of Contracts, Specific Performance, Company Membership Transfer
Commercial and Corporate Civil Procedure Contract Formation Counter Offer Interpretation of Contracts Specific Performance Company Membership Transfer

Case Brief

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Parties

Theodore Torre

Applicant

Walter Jürgen Kreiss

Respondent

Hein Kreiss

Respondent

Mfuleni Crocodile Farm CC

Respondent

Registrar of Companies & Close Corporations

Respondent

Procedural Posture

Civil Application / Final Relief on Motion

Legal Issues

  1. 1 Whether a binding contract for the transfer of membership interest in the close corporation was concluded between the applicant and the first respondent.
  2. 2 Whether the alleged cancellation notice was validly delivered before the contract became enforceable.
  3. 3 Whether the conduct and communications of the parties excluded ambiguity and established the existence of a contract.

Ratio Decidendi

The court found that a binding contract was concluded between the applicant and the first respondent for the transfer of the membership interest in the close corporation. The addition of 'Ohne Rechtsverbindlichkeit' on the signature pages did not negate the effect of the manuscript note 'Rechtsverbindlich: ab 09.05.2003' on the front page, which indicated that the agreement would become legally binding from 9 May 2003 unless cancelled before that date. The subsequent conduct of the parties, including the payment and receipt of R150,000, corroborated the existence of the contract. The respondents failed to prove that a valid cancellation notice was delivered to the applicant before 9 May...

Court Disposition

Application granted. The contract for transfer of membership interest is enforceable.

Orders

  • The First Respondent is ordered to transfer his membership interest in the Third Respondent to the Applicant and to sign page 3 of the amended Founding Statement (CK2) annexed to Annexure TT13 to the Applicant's Founding Affidavit.
  • The First Respondent is ordered to cede his loan account in the Third Respondent to the Applicant and to sign the cession of loan account annexed to Annexure TT13 to the Applicant's Founding Affidavit.