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Versitrade 540 (Pty) Ltd t/a Sutherland Transport v Global Telematics South Africa (Pty) Ltd (CA 248/2010) [2011] ZAECGHC 60 (27 October 2011)

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REPORTABLE

IN THE HIGH COURT OF SOUTH AFRICA

(EASTERN CAPE, GRAHAMSTOWN)

Case No: CA 248/2010

In the matter between:

VERSITRADE 540 (PTY) LTD

t/a SUTHERLAND TRANSPORT ..................................................................Appellant

And

GLOBAL TELEMATICS SOUTH AFRICA (PTY) LTD .............................Respondent


Coram: Chetty, Ebrahim and Schoeman JJ

Date Heard: 18 October 2011

Date Delivered: 27 October 2011

Summary: Contract – Whether binding agreement concluded – Contract comprising a number of documents - Confirmation document not signed in designated space – Appellants vehicles fitted with electronic devices and payment effected for several months – Documents evincing clear intention to enter into binding contract – Appeal dismissed

________________________________________________________________

JUDGMENT

________________________________________________________________

Chetty, J


[1] This appeal has its genesis in an ordinary commercial transaction between the appellant, a logistics company, and the respondent, a professional electronics company. It culminated in an action instituted by the respondent against the appellant in which it sought cancellation of the agreement concluded between them and payment of two amounts, the first, due and payable in terms of the agreement and the second, contractual damages arising from the appellant’s breach of the agreement.


[2] The proceedings before the court below were, notwithstanding appellant’s counsel’s protestations to the contrary, akin to a special case as envisaged by Rule 33 of the Uniform Rules of Court. Although the trial court was not presented with a written statement of facts, it is not in issue that the trial court acceded to the parties’ request that the merits of the action first be determined and the quantum of the claim be held over for later determination. Notwithstanding appellant’s counsel’s reluctance to concede the obvious, it is clear from the Rule 37 minute and the judgment itself that the sole issue the court below was called upon to adjudicate was whether the parties had concluded a binding agreement. The minute was prepared by the appellant’s attorneys of record and reads as follows, of relevance -



1. . . .

2. . . .

3. The parties confirmed their earlier agreement that, subject to the approval of this Honourable Court, there be a separation of issues and that the issues raised in paragraphs 2, 3 and 5 of the Defendant’s Plea, as amended, be tried separately and that all remaining issues stand over for determination at a later date.


4. On the assumption that a separation will be granted, the parties agree, for the assistance of the Court in deciding the separated issues, upon the matters dealt with hereunder.


5. The document headed “Proposal” (Bundle pp10 – 47) was:


5.1 signed by the defendant on page 24 thereof (Bundle p133);


5.2 not signed by the plaintiff.


6. The document headed “Order form” (Bundle p48) was:


6.1 signed by the defendant at the foot thereof;


6.2 not signed by the plaintiff.


7. The document headed “Order confirmation” (bundle p49) was:


7.1 signed by the plaintiff and the defendant alongside the amendments thereto at the top and at the middle of the page on 31 March 2006 at Port Elizabeth;

7.2 signed by the defendant at the foot of the page on 31 March 2006 at Port Elizabeth;


7.3 not signed by the plaintiff at the foot of the page.”



[3] The defences raised in paragraphs 2, 3 and 5 of the appellant’s plea are encapsulated in paragraphs 5, 6 and 7 of the minute and the trial court proceeded to hear argument from the parties. It found that upon a proper interpretation of the agreement, the proposal, the order form and the order confirmation document, a binding agreement had been concluded between the parties. To now contend that the parties had not consented to the procedure adopted and that the respondent took the risk by not leading viva voce evidence is rather disingenuous. Such disingenuity in fact permeates the appellant’s case from inception and an appraisal of the common cause facts demonstrates quite unequivocally how a simple business transaction unfortunately became befuddled by lawyerly obscurantism.


[4] It is common cause that on 20 February 2006 the parties met, the appellant’s needs were articulated and the respondent’s expertise sought. In due course it presented the appellant with a written proposal to minimise and eradicate the problems it had hitherto encountered. A solution overview was presented in a prolix document and it is useful to set out the services it offered the appellant. It reads as follows –


The Global Group is a global supplier of professional electronics, employing 66,000 staff in 50 countries, with revenue over €10 billion. Global backs all Global Telematics products and as such, Global Telematics provides a unique, high technology solution.


Vehicles and assets fitted with Global Telematics systems can be configured to send data automatically at pre-defined times or as a result of a specific vehicle event to the Global Telematics Hub, and they can be polled to obtain data on an ad hoc basis. This provides real-time information for fast, successful positioning and fleet and asset management.


Using the GSM wireless network and the Global Positioning System (GPS) our Telematics Control Units (TCU) can provide vehicle status information such as average speed, heading, ignition on/off, odometer readings, historical and real-time movements and vehicle events.


The TCU will report its information in real-time using SS/GPRS, or will store data for transmission at designated intervals, e.g., end of the day. The unit is set up to report every minute as per your requirements.


At the centre of our solutions, the Global Telematics Communication Hub provides a secure, scalable and reliable communications infrastructure for the management of Telematics units. The Hub is designed to provide connectivity between Telematics units, the GSM network, SMSC and Global Telematics client applications. Positional information provided by the system has an accuracy of better than 10 meters.


Data and management information generated by TCU’s is viewed using either our Global Fleeting Management Software (FMS). The FMS software can be loaded onto the PC as a standalone or enterprise-wide system. Vehicles and assets can be seen at country or street level; the status is easily seen at a glance; and the software is very user-friendly.


Our Managed-Service moves the management of the database onto our centrally managed database server, from which we generate the information required to meet your business objectives. It allows organisations to focus on the value that Telematics brings into the business by ensuring that the right data is in the right place at the right time. From our experience this service eliminates several key issues when the database is managed in house, such as difficulties in extracting, manipulating and understanding the complex data sets, resourcing reports, design and integration to meet rapidly changing business needs, and managing integration issued when the core FMS database is upgraded.”



[5] Assuaged no doubt by the commendations aforesaid, the parties met on 31 March 2006 where the pro forma agreement, the order form and the document, titled “order confirmationwas signed1. The pro forma agreement comprised six sections, three of which were deemed irrelevant and deleted. The remaining sections, one, three and six comprised the respondent’s company’s personal particulars, its banking details and debit order authorisation and authorised signatures respectively. These were all duly completed and signed and so too the terms and conditions of the agreement which comprised the remainder of the agreement.


[6] The order form2, on the appellant’s letterhead, appears as follows –

[Images on PDF]


[7] The order confirmation document appears as –


[Images on PDF]



[8] This document confirmed the order placed by the appellant. Thirty seven units would be installed at a cost of R575.00 per unit inclusive of driver management, relay cut, panic buttons and over rev sensor The order form correctly calculated the cost to the appellant to be the amount of R21, 275.00 per month excluding VAT.


[9] It is common cause that during April 2006 the envisaged electronic devices were installed in each of the appellant’s thirty seven vehicles and that payment in the agreed amount of R575.00 per month per vehicle was paid by the appellant to the respondent until the end of December 2006 after which no further payments were made. In consequence the respondent suspended its services to the appellant on 30 March 2007 and in due course instituted action against the appellant in which it claimed cancellation of the agreement, payment of the sum of R72,760.50 (37 X R575.00 x 3 months), and contractual damages in the sum of R898,179.41 and other ancillary relief.


[10] In its amended plea the appellant denied that a valid agreement had been concluded between the parties contending that the rental claimed by the respondent was not specified in what it termed the purported agreement”. It pleaded that –


The purported agreement constitutes an agreement of lease. It is an essential term for a valid agreement of lease that it reflect the rental (or rate) agreed upon between the parties. Because the rental (or rate) is not reflected in the purported agreement, such agreement is invalid and not binding as between the parties.”


[11] This characterization of the agreement as a purported” one first surfaced in paragraph 3 of its amended plea where it, in addition to the aforementioned, raised various technical defences to the respondent’s claim that a binding agreement had been concluded between them. Those defences were succinctly stated in the Rule 37 minute reproduced in paragraph [2] hereinbefore.


[12] In his judgment the trial judge held that the impugned documents evinced a clear intention to contract and constituted a binding agreement between the parties.


[13] On appeal before us Mr Steyn sought to persuade us that the trial court’s conclusion was clearly wrong. He argued that the agreement had to be in writing and the fact that the order confirmation form was only signed by the appellant in full, and by the respondent at places in the document where amendments were introduced but not at the foot of the page, rendered the signature of the respondent on that page incomplete. He relied on the cases of D’Arcy v Blackburn, Jeffreys & Thorpe Estate Agency3 and Brack v Citystate Townhouses (Pty) Ltd4 as authority for the proposition that the signatures of the respondent, appended to the order confirmation form, were insufficient as there was no signature at the designated place at the foot of the page. This had the result, so he argued, that the order confirmation form did not form part of the contract (for lack of the required signature). As this was the only document where the price was mentioned (excluding the order form signed by the appellant) there was no fixed price and the contract was inchoate.


[14] The cases cited as authority for this proposition both concern contracts for sale of land. In terms of the provisions of s 2 (1) of the Alienation of Land Act5, and its predecessor, any deed of alienation of immovable property must be signed by the parties thereto or by their agents acting on their written authority. Ex facie those cases it is clear that not every signature of the parties appearing on such a document would satisfy the provisions of the statute. What they emphasized is that the parties thereto appended their signatures on the document in such a way and at such a place as to indicate that they did so as a token of execution. Those cases are however distinguishable. The instant matter is not concerned with the sale of land and writing is not a prerequisite for validity. Clause 6, signed on the same day as the order confirmation, determines that the pricing stipulated on any of the relevant documentation forms part of the contract. The order form and the order confirmation are such relevant documentation and all the parties were present when such documents were signed. The parties knew exactly what the terms were and what the price for the items were. This is evidenced by the fact that both parties performed in terms of the agreement for a period of nine months. Furthermore, the absence of an agreement was not raised as a defence when the plea was first filed, but reared its head as a defence some two years after summons was issued.


[15] In my judgment, neither the trial court’s reasoning nor its conclusion can in any way be faulted. The defences raised are spurious and contrived. In the result the following order will issue –

The appeal is dismissed with costs.





_______________________

D.CHETTY

JUDGE OF THE HIGH COURT



Ebrahim, J


I agree.



______________________

Y. EBRAHIM

JUDGE OF THE HIGH COURT


Schoeman, J


I agree.



___________________

I. SCHOEMAN

JUDGE OF THE HIGH COURT



On behalf of the Appellant: Adv H.H. Steyn instructed by Nettletons, 118A High Street, Grahamstown, Tel: (046) 622 7149, Ref: Mr Nettleton


On behalf of the Respondent: Adv E.S. Grobbelaar instructed by Liston & Brewis Attorneys, 35 Albany Road, North End, Port Elizabeth, Tel: (041) 585 3363, Ref: Mr. Brewis

1These documents are those referred to in the Rule 37 Minute.

2This has been reproduced to show that the order placed by the appellant corresponds precisely with the confirmation document

3 1985 (2) SA 178 (E) at 179E-180G, 181C-182F

4 1982 (3) SA 364 (W) at 366C-G, 368E-369C

5Act No, 68 of 1981