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Knowman Enterprises (Pty) Ltd v China Jiangsu International Botswana (Pty) Ltd and Others (MAHFT-000 005 of 2007) [2007] BWHC 214 (<<28 February 2007>>)

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IN THE HIGH COURT OF THE REPUBLIC OF BOTSWANA

HELD AT FRANCISTOWN



MISCA NO. MAHFT-000 005 of 2007



In the matter between:


KNOWMAN ENTERPRISES (PTY) LTD Applicant


And


CHINA JIANGSU INTERNATIONAL

BOTSWANA (PTY) LTD 1st Respondent


GROUP CONSULT BOTSWANA (PTY) LTD 2nd Respondent


NORTH WEST DISTRICT COUNCIL 3rd Respondent



Mr N Chadwick for the Applicant

Mr M B Marumo with Mr L M Lecha for the 1st Respondent




J U D G M E N T



PHUMAPHI J:


  1. By notice of motion filed in this Court on 22 January 2007 on urgency, Applicant sought and obtained the following Order:


1. A Rule Nisi returnable on 9th February 2007 shall be and is hereby issued calling on the Respondents to show cause, if any, to this Honourable Court on the 9th February, 2007 at 9:30 a.m. or so soon thereafter as counsel may be heard why it should not be ordered:


    1. that the First Respondent be strictly restrained and enjoined itself or through its servants or agents directly or indirectly from terminating the sub-contract between the parties relating to Road Number 16, Maun or from taking any action whereby the Applicant is hindered or disturbed in its functions thereunder pending the final determination of all matters of dispute between the Applicant and First Respondent arising from the works required in respect of Road Number 16, Maun, thereunder;


    1. that the letters written by the First Respondent to the Applicant dated 8th January 2007 and 11th January 2007 are declared to be of no force or effect;


    1. that the First Respondent be ordered to pay the costs of the suit.


    1. that there be no Order as to costs against the Second and Third Respondents save in the event of their opposing the application.


  1. that the Rule Nisi shall operate as an interim interdict in terms of paragraph 2(i) above until the return date.


  1. that the Respondent be at liberty to anticipate the return date on 48 hours notice to the Applicant’s Attorneys.


  1. that the 1st Respondent shall file an answering affidavit by the 31st January 2007.


  1. the Applicant shall file its replying affidavit if any by the 7th February 2007.


  1. the 2nd and 3rd Respondents are at liberty to file any response prior to 9th February 2007.


  1. a copy of this Order shall be served to all the respondents.


  1. today’s costs shall be costs in the cause.”



  1. Mr Lecha who had filed notice of opposition on behalf of the 1st Respondent was in attendance, but did not oppose the granting of the Rule Nisi, rather preferring to answer the allegations of the Applicant contained in the founding affidavit.


  1. The urgent application was precipitated by the 1st Respondent through a letter dated 8 January 2007 which intimated its intention to terminate the sub-contract between itself and the Applicant. The 1st Respondent gave the Applicant 14 days within which it was to hand over completed works. In turn the Applicant through its attorneys wrote back to the 1st Respondent, pointing out that the 1st Respondent was in breach of the agreement between the parties, in that it did not timeously pay the preliminary and general expenses that were due to the Applicant and that when it finally paid them they were substantially reduced. In effect the gist of the Applicant’s argument, is that it accepted the reduced preliminary and general expenses under duress because the 1st Respondent pushed it to financial dire straits by refusing to pay an amount which was in the region of P800,000.00 or so Pula.


  1. It is common cause that the agreements signed between the parties were entered into without the knowledge of the Engineer, who, in terms of Clause 4.1 of the contract signed between the 1st Respondent and 3rd Respondent, was to approve any sub-contractors that were to be engaged by the 1st Respondent.


  1. According to the agreement between Applicant and 1st Respondent, Applicant was to do work on Road 16 and Matshwane Road, however, when the Engineer became aware of the sub-contract between Applicant and 1st Respondent, he gave approval to Applicant only for work on Road 16 but not for Matshwane Road. When 1st Respondent gave Applicant the 14 days’ notice within which to deliver completed works, it included Matshwane Road, to which Applicant countered and said delivery of completed works with respect to Matshwane Road was a legal impossibility as the Engineer had not granted his consent pursuant to Clause 4.1 of the Contract between 1st Respondent and 3rd Respondent.


  1. As regards Road 16, the Applicant argues that, since the Engineer approved it as the sub-contractor, it was a nominated sub-contractor as contemplated by Clause 59.1 of the Contract between the 1st Respondent and the 3rd Respondent. The 1st Respondent on the other hand contends that, the Applicant is not a nominated sub-contractor as contemplated by Clause 59.1 but a mere domestic sub-contractor who is governed by the conditions of the agreement between itself and 1st Respondent.


  1. This Court having heard full argument on behalf of each of the parties, ordered that the Engineer, Mr Mungure should appear before it on 26 February 2007 for the purpose of clarifying the distinction between a nominated contractor and a domestic contractor. At the beginning of the proceedings on 26 February 2007 Counsel for both parties consented that Mr Mungure should give evidence as desired by the Court.


  1. Mr Mungure duly appeared and explained that a nominated sub-contractor was one appointed by the Employer or the Engineer at the instance of the Employer, to render services for which provisional sums are included in the contract. A nominated sub-contractor has a relationship with the Employer whereas, a domestic sub-contractor only has a relationship with the main contractor and their relationship is governed by the agreement between the two of them.


  1. Mr Mungure further explained that the Engineer has no locus standi to intervene in a dispute between the main contractor and a domestic sub-contractor save in a mediatory capacity. He also explained that the only purpose for which the Engineer’s consent or approval is required in terms of Clause 4.1 of the main contract, is to ensure that the sub-contractor chosen by the main contractor is competent to do the work. He specifically said his consent or approval of a domestic sub-contractor did not elevate such sub-contractor to the status of a nominated contractor.


  1. The way I understand the evidence of the Engineer is that, if the Applicant were a nominated sub-contractor the termination of the Applicant’s contract would not lie within the power of the main contractor but with the employer and therefore an attempt to terminate by the main contractor would be of no legal consequence. Similarly, the question of passing on the benefit of time extension to 31 March 2007 to the Applicant contended for by the Applicant’s Counsel would not arise.


  1. I now have to consider whether the Applicant has made out a case on a balance of probabilities for me to confirm the Rule Nisi issued on 22 January 2007. It has been held in this jurisdiction and elsewhere in other Roman Dutch jurisdictions in the region that, for an applicant to be granted a final interdict he must establish the following:


      1. that he has a clear right that he seeks to protect;


      1. that if he is not granted the interdict the injury apprehended is likely to result in irreparable harm;


      1. that he has no alternative remedy by normal means.


Vide: Setlogelo v Setlogelo 1914 AD 221;

Botswana Ash (Pty) Ltd v Zuzumbe (Pty) Ltd [2003] 1 BLR 58.

  1. In order to satisfy the first requirement, the applicant must lead evidence to establish facts that show on a balance of probabilities that it has a clear or definite right in terms of the law. The right that Applicant seeks to protect must exist in law. In the instant case, Applicant has made allegations in his founding affidavit which it supported with annexures “B” and “D” inter alia, in a bid to show what was agreed between Applicant and 1st Respondent.


  1. In argument, however, it was contended on behalf of the Applicant that Applicant’s rights were to be determined in accordance with FIDIC Contract which governed the relationship between 1st Respondent and 3rd Respondent. If I understood the Applicant’s Counsel’s submissions correctly, he sought to distance Applicant from the agreements it signed with the 1st Respondent, on the ground that Applicant signed the documents under duress having been put in a financial predicament by 1st Respondent.


  1. Unfortunately for the Applicant, however, the Engineer has dispelled beyond doubt any notion that Applicant is a nominated sub-contractor as contemplated by Clause 59.1 of the FIDIC Contract.

  2. The Applicant has not been able to demonstrate a clear right or definite right either based on the agreement it signed with 1st Respondent or on the FIDIC Contract.


  1. The second requirement only comes into play if the Applicant has established a clear or definite right. In other words if the Applicant has failed to establish a clear or definite right there can be no breach or infraction of a non-existent right.


Vide: Minister of Law and Order Bophuthatswana, and Another v Committee of the Church Summit of Bophuthatswana and Others 1994(3) S.A 89 at p. 98 para H-I where Friedman AJP said:


Ad an injury actually committed or reasonably apprehended


This is the second essential for the granting of a final interdict. The phraseology ‘injury’ means a breach or infraction of the right which has been shown or demonstrated and the prejudice that has resulted therefrom.”


  1. I have already found that the Applicant failed to establish a clear right and therefore the second requirement cannot be established in the abstract, thus I find that the Applicant has failed to satisfy this requirement as well.


  1. I now turn to the third essential for granting a final interdict which is that the Applicant must demonstrate that he has no adequate alternative remedy. It has been held that applicant will not be granted an interdict, if he can be awarded adequate compensation or damages. Vide Minister of Law and Order Bophuthatswana and Another v Committee of the Church Summit Bophuthatswana and Others (supra) at page 99 para G-H where the Court said:


Generally an applicant will not obtain an interdict if he can be awarded adequate compensation or amends by way of damages.


The enquiry on this essential is whether an interdict is the only relief or remedy to help the applicant, or is there a satisfactory alternative remedy. Furthermore, the circumstances relating to each case will indicate whether the award of damages is an adequate alternative remedy.”


  1. The founding affidavit shows that the Applicant was entitled to some P850 000.00 as preliminary and general expenses which 1st Respondent refused to pay. At that stage the Applicant was at large to approach the court for an order compelling the 1st Respondent to pay. However, the Applicant elected to sign annexures “B” and “D” the effect of which was to disavow his claim to the P850 000.00. It contends that it signed those annexures involuntarily due to financial pressures brought upon it by the conduct of the 1st Respondent, if that were so, it was still open to the Applicant to approach the Court on good cause shown to seek an order nullifying the two documents.


  1. The Applicant let those opportunities pass and now says it has not alternative remedy. If indeed what the Applicant says is true, its predicament is self-created and therefore it cannot be heard to complain.


  1. The Applicant’s affidavit also shows that it has already done up to 70% of the work on Road 16 and it will suffer irreparable harm if it is not granted the interdict. Surely the Applicant can sue for the value of 70% of the work done and damages for wrongful termination of the contract if indeed the termination is wrongful as suggested in its affidavits.


  1. In my view, not only has the Applicant had the opportunity for adequate alternative relief in the past, but it still has that opportunity now. In the circumstances I conclude that the Applicant has failed to satisfy the third requirement for the grant of an interdict as well.


  1. In the final analysis the Applicant has failed to make a case for the issuing of a final interdict and I therefore discharge the Rule Nisi granted on 22 January 2007.


  1. There is yet another short matter I have to deal with before I rise.


  1. When this matter came before me on 9 February 2007 which was the return day, the Applicant sought to amend the initial order it obtained when the Rule Nisi was issued, by asking this Court to declare that the Applicant was a nominated sub-contractor under Clause 59.1 of the FIDIC Contract. I summarily dismissed the application and said I would give my reasons later. I declined to grant the amendment as it was clear from the reading of the papers filed that the Applicant was attempting to meet the points raised by the 1st Respondent in its answering affidavit.


  1. As a general rule, the court will not allow an applicant to amend its claim to deal with issues that were omitted in the founding affidavit when they should have been included. It is usually said an applicant must stand or fall by its founding affidavit. The Court will only allow such an amendment if there are special circumstances to warrant it. None were pointed out to me and I therefore declined to grant the amendment.


  1. The costs shall follow the event.

DELIVERED IN OPEN COURT AT FRANCISTOWN THIS WEDNESDAY THE 28TH DAY OF FEBRUARY 2007.




---------------------------

M P PHUMAPHI

[JUDGE]


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