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South Africa: Supreme Court of Appeal |
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In the matter between
BRIAN BASIL NEL, N.O. Second Appellant
and
BOE BANK LIMITED Respondent
Heard: 29 AUGUST 2003
Delivered: 26 SEPTEMBER 2003
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HEHER JA
HEHER JA:
[1] I have read the judgment of Navsa JA. I agree with his conclusions on the issues of authorisation and the recipient in law of the money advanced by the respondent.
[2] As to whether the agreements lapsed I regret that I see the matter somewhat differently. For the reasons which follow, I think that Ludorf J was correct in the order he made.
[3] Of course the respondent could at any time during the validity of the agreements have notified the borrower in writing that it did not require compliance with any specified aspect of any of the suspensive conditions, thereby formally waiving its right to rely on non-fulfilment. However, because of the particular terms of clause 2.1 of each agreement, this was not the only option open to the respondent.
[4] Clause 2.1 laid down a minimum measure for the assessment of whether the suspensive conditions had been fulfilled. That measure was the satisfaction of the respondent. In addition, lest any doubt should remain, clause 2.2 provided that the conditions were stipulated for the benefit of the respondent. Because the unrestricted satisfaction of the respondent was to be decisive it was entitled to regard any degree of performance from 0% to 100% as fulfilment. The only, implied, requirement was that the expression of its satisfaction should be communicated to the borrower before the agreements lapsed in order to render the fulfilment effective.
[5] Such an expression of satisfaction in relation to any of the conditions was a right conferred on the respondent and the communication was its exercise. The agreements did not require that it be exercised in writing.
[6] The evidence established that the respondent did communicate its satisfaction with regard to the fulfilment of clause 2.1.1 while the agreements were still in esse. In these circumstances, waiver, ie an abandonment of a right to rely on the non-fulfilment of the condition in question, is irrelevant.
[7] The respondent extended the date by which clause 2.1.1 had to be fulfilled in writing from time to time from 17 June 1999, the last extension expiring on 20 August 1999.
[8] That there were effective extensions of the agreements seems to me an overwhelming inference derived from the way in which the case was presented by the respondent and fought by both sides:
(a) In opening the case for the respondent in the trial Court senior counsel, Mr Wallis, informed the Court that there had been seven letters extending the agreements.
(b) In fact, the bundle of documents placed before that Court (and included in the appeal record) included only three such letters, dated 17 and 18 June and 22 July. The respective letters each dealt with all the conditions which had not at the time of writing been fulfilled. The first extended the date for fulfilment of clause 2.1.1 to 18 June, the second extended that date to 25 June and the last extended it to 22 August.
(c) Mr Wallis, in leading his witness Mr Heron of the respondent and referring to the extension letters, said
‘Now I do not propose to take you to all of them . . . but there were a number of extension letters?’ ─ ‘That is correct.’
Heron confirmed that his colleague Cooper was responsible for attending to the fulfilment of the agreements.
(d) In the evidence in chief of Mr Cooper the witness confirmed that the letter of 22 July was ‘the last letter’ which he wrote.
He said:
‘We kept sending the letters [of extension] . . . You will see they were weekly or fourteen day extensions and then I pushed it up to three or four weeks to cover the period while I was away on leave. I went away at the beginning of August.’
(e) The evidence of Cooper and the correspondence leaves no doubt that the question of fulfilment was a matter constantly at the forefront of the minds of himself and other officials of the respondent. He was very aware of the requirement that the agreements needed to be extended before they lapsed by the sending of timeous notices to the borrower. It is very probable that the letters not produced in evidence had the necessary effect. In cross-examination of Cooper senior counsel for the appellants suggested to him that clause 2.1.1 had, notwithstanding the respondent’s satisfaction with the alternative performance, not been fulfilled according to its terms. Counsel did not suggest that the letter of 22 July had not been preceded by others in a chain of extensions or that that letter would not in any event have been effective in extending the time for fulfilment of clause 2.1.1 because the agreements had already lapsed which, if the facts bore him out, would have been the obvious line of attack.
[9] No agreement was signed between the parties to the sale from Aspen to the borrower. By the end of July internal correspondence of the respondent leaves no doubt that the responsible officials, Messrs Steensma, Corey, Whittaker, Heron and Cooper, were satisfied that fulfilment of clause 2.1.1 according to its terms was unnecessary as ‘the requirements of that clause have been satisfied via other means’ (memo from Steensma to Cory dated 26 July 1999). When Cooper returned from leave in the middle of August he was told by his senior Whittaker that the latter had notified Hiscock (who possessed authority to represent the borrower) telephonically that the respondent was satisfied and regarded the agreements and the transaction as completed. The respondent decided for this reason, correctly, in my view, that it was unnecessary to extend the agreements once again. (It was common cause that Whittaker was disabled by a fatal illness from testifying and there is no reason why reference to his conversations and correspondence with Cooper and Hiscock should be excluded from consideration.) The evidence was substantially adduced by appellant’s counsel in cross-examination of Cooper, its correctness was not placed in issue and Hiscock was not called to rebut it. It is true that the respondent did not plead such fulfilment but Mr Wallis stated unequivocally in his opening address to the Court a quo that he would rely on the satisfaction of Whittaker for the fulfilment of clause 2.1.1. There was not then or thereafter objection from the appellant’s side. Although he did not refer to the oral communication of that satisfaction to the borrower that critical gap was filled by the cross-examination of Cooper. There is no suggestion that the matter was not fully canvassed by the evidence or that anything further could have been said or done to dilute its effect. I conclude, therefore, that the evidence proved that clause 2.1.1 of each agreement was fulfilled to the satisfaction of the respondent although no final or unconditional agreements were produced or signed as provided in the clause.
[10] I would, therefore, dismiss the appeal with costs, including the costs of two counsel, on the scale as between attorney and client.
___________________
J A HEHER
JUDGE OF APPEAL
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.RTF of original document