Van Streepen & Germs (Pty) Ltd. v Government of the Republic of South Africa (113/89) [1990] ZASCA 127 (1 October 1990)

Van Streepen & Germs (Pty) Ltd. v Government of the Republic of South Africa (113/89) [1990] ZASCA 127 (1 October 1990)

The court held that Variation Order 4 was a routine administrative document issued in terms of clause 3(iii) of the contract and was not intended by the respondent to function as an offer to vary the contractual basis of payment. There was no evidence of animus contrahendi or consensus between the parties to substitute fair and reasonable remuneration for the agreed rates. The appellant failed to establish, on a balance of probabilities, that VO4 constituted a contractual variation. The acceptance of VO4 by the appellant did not amount to acceptance of a new contract or variation of the payment terms. The original structure of remuneration, based on fixed rates, remained in force, and the...

Citation
[1990] ZASCA 127
Parties
Appellant: Van Streepen & Germs (Proprietary) Limited; Respondent: Government of the Republic of South Africa
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
1 October 1990
Case Number
113/89
Procedural Posture
Civil Appeal / Appeal From Transvaal Provincial Division; Trial Court Dismissed Both Main and Alternative Claims; Leave to Appeal Granted on All Main Issues; Appeal Limited to Claim Founded on Variation Order 4.
Outcome
Appeal dismissed with costs, including costs of two counsel.
Judges
Joubert, Nestadt, F H Grosskopf, Nicholas, Nienaber
Legal Topics
Construction Contracts, Variation Orders, Animus Contrahendi, Contractual Consensus, Remuneration Basis
Commercial and Corporate Civil Procedure Construction Contracts Variation Orders Animus Contrahendi Contractual Consensus Remuneration Basis

Case Brief

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Parties

Van Streepen & Germs (Proprietary) Limited

Appellant

Government of the Republic of South Africa

Respondent

Procedural Posture

Civil Appeal / Appeal From Transvaal Provincial Division; Trial Court Dismissed Both Main and Alternative Claims; Leave to Appeal Granted on All Main Issues; Appeal Limited to Claim Founded on Variation Order 4.

Legal Issues

  1. 1 Whether Variation Order 4 (VO4) constituted a variation of the contractual provisions governing payment from fixed rates to fair and reasonable remuneration.
  2. 2 Whether the parties had the necessary animus contrahendi to novate or modify the existing contract.
  3. 3 Whether consensus was reached between the parties on the new basis of remuneration.

Ratio Decidendi

The court held that Variation Order 4 was a routine administrative document issued in terms of clause 3(iii) of the contract and was not intended by the respondent to function as an offer to vary the contractual basis of payment. There was no evidence of animus contrahendi or consensus between the parties to substitute fair and reasonable remuneration for the agreed rates. The appellant failed to establish, on a balance of probabilities, that VO4 constituted a contractual variation. The acceptance of VO4 by the appellant did not amount to acceptance of a new contract or variation of the payment terms. The original structure of remuneration, based on fixed rates, remained in force, and the...

Court Disposition

Appeal dismissed with costs, including costs of two counsel.

Orders

  • The appeal is dismissed with costs, including the costs of two counsel.