Republic of South Africa

REPORTABLE

IN THE HIGH COURT OF SOUTH AFRICA 
(WESTERN CAPE HIGH COURT, CAPE TOWN)
CASE No: A 178/09

In the matter between:

and

JUDGMENT DELIVERED : 3 NOVEMBER 2009
MOOSA, J: 
The Special Plea
[1] On 8 May 2006, the Respondent (hereinafter referred to as the Plaintiff) sued the Appellant (hereinafter referred to as the Defendant) for the sum of R59 381,47 being the balance of the contract price arising from a building contract concluded between the parties. The Defendant filed a Special Plea. In terms of such plea, the Defendant pleaded that he had tendered to the Plaintiff a cheque dated 18 November 2005 in the sum of R26 171,64 in full and final payment, which cheque was presented for payment and was in fact honoured on 19 November 2005. The Plaintiff accordingly accepted the tender of the said cheque in full and final settlement of his total claim.

The Settlement Agreement

The Preliminary Application
[3] This court is also seized with a preliminary application for the condonation of the late lodging of the record and the re-instatement of the appeal. This application is opposed by the Defendant. In terms of Rule 50(1) of the Uniform Rules of Court an appeal shall be prosecuted within 60 days after it has been noted, failing which such appeal shall be deemed to have lapsed. This court has a discretion to grant an indulgence on consideration of all the circumstances of the case. This court agreed to hear both the application for condonation and the appeal simultaneously as one of the considerations relating to the application for condonation is whether or not there are reasonable prospects of success on appeal.

The Facts
[4] The facts are briefly as follows. In and during November 2004, the parties concluded a building contract in terms of which the Plaintiff agreed to construct a dwelling for the Defendant. The agreed contract price was R368 000,00. A further term of the agreement was that the building would be completed and handed to the Defendant by 15 April 2005. Should the Plaintiff fail to do so by that date, he shall be liable to the Defendant for a penalty calculated at the rate of R270,00 per day for the duration of the delay ("the first contract"). During the course of the construction, the Defendant wanted certain changes to be effected to the dwelling and a second contract was concluded for such extras ("the second contract"). The costs for the extra work, according to the Plaintiff, amounted to R50 625,11, but according to the Defendant amounted to R42 109,00.

The Findings Of The Trial Court

The Grounds of Appeal
[6]      The appeal is based on the grounds that the Magistrate erred in finding:
a)	
b)	that the Defendant's evidence that he gave the cheque to the Plaintiff on the understanding that the acceptance thereof would amount to the full settlement of his (Plaintiff's) claim, was not the correct version; 
(c) that the depositing of the cheque is not an indication that he consented to the agreement.

The Legal Issue

"The essential issue is whether an agreement of compromise was concluded: one is concerned simply with the principles of offer and acceptance. The first question is whether the cheque accompanied by the Credit Request and Final Reconciliation constituted an offer of compromise. In other words, 'the proposal, objectively construed, must be intended to create binding legal relations and must have so appeared to the offeree... Although, generally, a contract is founded on consensus, contractual liability can also be incurred in circumstances where there is no real agreement between the parties but one of them is reasonably entitled to assume from the words and conduct of the other that they were in agreement."

The Evaluation

[13] It is common cause that the parties concluded a second contract for certain extra work that the Defendant required the Plaintiff to perform. Such extra work superceded the completion date. The parties did not stipulate a completion date in the second contract nor extended the completion date in the first contract. The Defendant was accordingly not entitled to claim any deduction in respect of the non-compliance with the penalty clause in the first contract.

[14] The Defendant in his Plea states that taking into consideration the amount owing by Plaintiff in terms of the penalty clause, the total amount owing by him to the Plaintiff was R348 723,64, which amount was paid in full to the Plaintiff. Such amount is lower than the original contract price and could accordingly not have included the costs for the extras. His plea that the total amount owing to the Plaintiff was R348 723,64 is inherently incorrect. The Defendant does not state what amount he claimed in terms of the penalty clause.

[15] The agreed contract price was R368 000,00 which was reduced by an amount of R10 520,.00 in respect of certain material supplied by the Defendant to the Plaintiff. The balance was accordingly R 357 480,00 to which must be added the extras amounting to R50 625,11, making a total contract price of R408 105,11. The Defendant in his Plea alleges that the price for the extras amount to R42 109,00 and in support thereof annexes two quotes one amounting to R25 803,00 and the other to R16 306,00. The first quote sets out only the costs for material and does not include the costs of labour. The only reasonable inference the court can draw is that the difference, between extras stipulated

by the Defendant of R50 520,00 and the amount of R42 109,00, as stipulated by the Defendant, amounts to labour costs in respect of the installation of the cupboards.

The Findings

"But I agree with the view that in case of doubt the construction should be against the debtor, for he had it in his power to make his meaning clear." 
The Plaintiff was therefore entitled to accept the payment in full and final settlement of the first contract. It appears to me that such compromise did indeed take place because there was a figure of R8 756,36 owing on the first contract that was compromised. With regard to
the second contract, an amount of R625,11 was compromised, but that occurred by agreement between the parties as reflected in the Settlement Agreement.

The Application for Condonation
[19] I now return to consider the application for condonation. I have mentioned earlier that one of the considerations for an application for condonation is the prospect of success of the appeal. It is clear from the judgment on the merits that the Defendant was partially successful on appeal. The failure to file the appeal record timeously, visits serious consequences on such appeal, in that the appeal is deemed to have lapsed. It appears that a number of role players contributed to the delay, least of all the Defendant's lawyers. I am of the view that, in the interest of the administration of justice condonation be granted.

[20] At the same time I am constrained to mention that the appeal was not launched timeously in terms of the rules. It also appears that no security for costs, as required in terms of the rules, was filed. It also does not appear that such shortcoming and omission were condoned. Insofar as it may be necessary, the condonation is granted.

The Appealability of the Judgment

The Costs
[22] I will firstly deal with the costs pertaining to the application for condonation. It is generally accepted that the person who seeks an indulgence pays the costs. In this case the application was opposed. I am of the view that the Plaintiff was justified in opposing the application. It appears that on a previous occasion when a similar application was brought, the Plaintiff did not oppose such application. I consider that a fair and equitable award as to costs in respect of the application is that the Defendant pays the costs of the application for condonation and that the Plaintiff bears the wasted costs occasioned by the opposition.

The Order

i e the "Skikkingsakte" is confirmed;

MATOJANE, AJ: I agree.