Van Niekerk v W en A Le Roux Slaghuis (Pty) Ltd and Another (73622/2015) [2017] ZAGPPHC 624 (18 September 2017)

IN THE HIGH COURT OF SOUTH AFRICA

(GAUTENG DIVISION, PRETORIA)

Case Number: 73622/2015

Date: 18 September 2017

Not reportable

Not of interest to other judges

Revised.

18 September 2017

In the matter between:

CLJ VAN NIEKERK Applicant

And

W EN A LE ROUX SLAGHUIS (PTY) LTD 1st Respondent

VANS AUCTIONEERS GAUTENG CC Second Respondent

JUDGEMENT IN RESPONDENTS' APPLICATION FOR LEAVE TO APPEAL

DU PLESSIS. AJ

1.

The Respondents apply for leave to appeal against the judgement in the above matter delivered on 7 November 2016.

2.

The Applicant submitted a bid of R 3.3 million on an auction held on 14 May 2015 on what was described as "Lot 1: Property consisting of: Double story building with offices, butchery with cold room and freezer room, storage rooms, bakkery, cell phone tower with rental income, staff changing/rest rooms, parking for customers and more".

The Auctioneers note read: 'Well-established butchery, ideal opportunity to purchase a fully operational and equipped butchery and bakkery."

3.

The butchery up for auction originally belonged to the First Respondent who instructed the Second Respondent, Van's Auctioneers, to conduct the sale of the property.

4.

On the day of the auction, 14 May 2015, the Applicant (Buyer) signed an "Agreement and Conditions of Sale in respect of immovable property'. On the same day the Applicant also paid an amount of R 612,150.33 as was described in the "Agreement and Conditions of Sale" consisting of R 330 000.00 as a 10% deposit on the total of the ·purchase price, R 247,500.00 as 7.5% of the purchase price as the Auctioneer's commission and R 34,650.00 as 14% VAT on the commission alone. (See in this regard, paginated page 51).

5.

When the Applicant visited the property on 18 May 2015, four days after the auction, he found that the two cool rooms and freezer room of the property that he bought were in the process of being removed and were damaged as parts were already removed from the cool rooms and the freezer rooms. The rails and hooks affixed to the roof of the butchery and on which the animals' carcasses were transported were also removed.

6.

The Applicant immediately on 19 May 2015 informed the Seller and the Auctioneer (First and Second Respondents) in writing of the damage and informed the Respondents that they regarded this conduct by them as a repudiation of the Agreement between the parties.

7.

It transpired that the Second Respondent (on the apparent instruction of the First Respondent) sold the cold and freezer rooms at a second auction to a third party on the same day. The Second Respondent admitted in the answering affidavit that he made a mistake "dat Mnr Harding 'n fout gemaak het in die hantering van die veiling deur onder andere die koelkamers en/of vrieskamer klaarblyklik te verkoop aan 'n ander koper".

8.

The Agreement and Conditions of Sale referred to above, is the same document referred to by the Respondents as an "Offer to Buy". Clause 2.1 of this document (the Agreement and Conditions of Sale and the Offer to Buy) determines that "the Purchaser is unconditionally and irrevocably bound to this offer for a period of 14 calendar days (the calculation of which excludes the date of signature hereof by the Purchaser) and the offer is open for acceptance by the Seller at any time during this period."

9.

In Clause 13.3 of the Agreement and Conditions of Sale referred to in paragraph 4 above, it is determined that "in the event of cancellation of this Agreement, the Purchaser shall forfeit all monies paid, including commission paid in terms of this Agreement to the Seller and/or the Auctioneer as liquidated damages."

10.

Applicant applied for a Declaratory Order that they withdrew their bid made on 14 May 2015 on the property as referred to above properly and lawfully, alternatively they requested a Declaratory Order that they cancelled the Agreement in respect of the property properly and lawfully and finally that the Respondents be ordered to repay the amount of R 612,150.00 to the Applicant within two days from the date of this order the one paying the other to be absolved.

11.

I made the following order:

(a) Applicant cancelled the Agreement in respect of the property at 554 Souter Street, Pretoria West, dated 14 May 2015 properly and lawfully;

(b) The First and Second Respondents are ordered to pay to the Applicant the amount of R 612,150.00 to the Applicant within 14 days from the date of this Order, the one paying the other to be absolved.

12.

The Respondents deny that the Applicant may rely on a repudiation by the Respondents as it presupposes the existence of a valid and binding Sale Agreement. The Respondent submits that, so the argument goes, by the time the alleged repudiation took place, the Applicant's offer had not yet been accepted, and there was accordingly at the relevant time no binding Agreement capable of been repudiated. The alleged repudiation occurred on 14 May 2015 and the Applicant's offer was only accepted on 27 May 2015. Therefore, so the Respondent says, their conduct was not capable of being construed. as repudiation - at least not until they accepted the offer. In addition to the above argument, the Respondents also submit that when the Applicant informed the Respondent that he did not regard himself as bound by the Sale Agreement , that conduct constituted a repudiation of the Agreement, and, because the Respondents had no appetite to become involved in litigation to force the unwilling Purchaser to take transfer of the immovable property, they accepted the Applicant's repudiation of the Agreement of Sale.

13.

In the application for leave to appeal, the Respondent submits that the First and Second Respondents could not be held jointly liable for the repayment of the R 612,150.00 as, the Auctioneer acted as the Seller's agent and is not liable to the Purchaser.

14.

The First Respondent mandated the Second Respondent, Vans Auctioneers, to conduct the sale of the property and loose assets at an auction. The Respondents in appeal submit that this Court failed to consider that the Second Respondent had no contractual relationship with the Applicant and that the Second Respondent was but the First Respondent's agent. This is not borne out by the evidence nor the Agreement of Sale. There is no evidence that the auction was not a public auction.

15.

The Respondents submit that there is a material difference between the offer to buy and the Agreement of Sale and as the Applicants relied on repudiation of the agreement of sale and not the offer to buy, this Court was not entitled to order the cancellation of the agreement in respect of the property sold, and similarly the repayment of the amounts paid by the Applicant to the First and Second Respondents.

16.

I do not agree with the Respondents' submissions regarding the intention of the Second Respondent to only deliver the butchery to

the Applicant and in particular because the Second Respondent, in the answering affidavit, admitted that they incorrectly auctioned the "koelkamers and/of vrieskamers aan 'n ander koper'' .

17.

This Court might have been incorrect in its acceptance that the conduct of the Respondents prior to the signing of the Agreement of Sale by the First Respondent, is sufficient for purposes of repudiation of the agreement. As the second order of payment of the amounts mentioned, is linked to the order cancelling the Agreement of Sale, leave should be granted against the whole of the judgement dated 7 November 2016.

18.

As a consequence, I make the following order:

(a) Leave to appeal against the whole of the judgement dated 7 November 20/is granted to the full bench of the Gauteng Division, Pretoria.

_________________

J DU PLESSIS AJ