Gandhi School Close Corporation v Pieterse (I4170/2008) [2013] NAHCMD 349 (21 November 2013);

Group

Full judgment

REPUBLIC OF NAMIBIA


HIGH COURT OF NAMIBIA MAIN DIVISION, WINDHOEK

 

JUDGMENT


Case no: I 4170/2008

Reportable

 

In the matter between:

 

GANDHI SCHOOL CLOSE CORPORATION

t/a GANDHI (PRE AND PRIMARY) SCHOOL                                                               PLAINTIFF

 

and

 

LESTER PIETERSE

t/a GREYSTONE BUILDING ENTERPRISES CC                                                DEFENDANT

 

Neutral citation:      Gandhi School Close Corporation v Pieterse (I 4170/2008) [2013] NAHCMD 349 (21 November 2013)

 

Coram:          PARKER AJ

Heard:            7 October 2013; 9 October 2013

Delivered:     21 November 2013

 

Flynote:         Contract – Breach – Cancellation – On the facts and circumstances of the case whether reasonable to cancel contract.

 

Flynote:         Contract – Breach – Damages – Plaintiff must allege and prove nature and method of calculation of damages.

 

Summary:     Contract – Breach – Cancellation – Court found that the defendant breached contract to construct the plaintiff’s school buildings and other structures – Plaintiff was magnanimous in giving defendant ample time to complete the works in terms of the contract – Defendant was aware that deadlines for completing the works was critical for the plaintiff’s enterprise – Defendant did not only fail to complete the works within deadlines but completed some of the works with poor quality materials and in breach of Windhoek Municipality approve designs – On the facts and in the circumstances the court found that it was reasonable for the plaintiff to cancel the contract and claim damages.

 

Summary:     Contract – Breach – Damages – Plaintiff must allege and prove nature and method of calculation of damages – Court found that the plaintiff alleged and meticulously set out the nature of the damages suffered and the method of calculation of the damages – Consequently, court granting judgment for the plaintiff, confirming cancellation of the agreement and ordering damages in favour of the plaintiff.


 

ORDER


 

(a)      Judgment is for the plaintiff in the amount of N$1 059 901,00, together with interest thereon at the rate of 20 per cent per annum, calculated from the date of this judgment to the date of final payment.

 

(b)      The cancellation of the agreement between the plaintiff and the defendant is hereby confirmed.

 

(c)      The defendant must pay plaintiff’s costs of suit, including costs of one instructing counsel and one instructed counsel.

 


JUDGMENT


 

PARKER AJ:



[1]        In this matter the plaintiff instituted action against the defendant, a builder. The plaintiff is a primary school and its claim is based on breach of contract on the part of the defendant. The plaintiff, accordingly, seeks confirmation of cancellation of the agreement entered into between the plaintiff and the defendant and claims damages from the defendant for the breach.

 

[2]        The case concerns a building contract in terms of which the defendant agreed to carry out construction of school buildings for the plaintiff, and it was subjected to judicial case management (‘JCM’) procedures at the end of which a pre-trial conference order was made on 26 September 2013. At the pre-trial conference on that day the defendant did not appear in person or by counsel, although he was aware of the date and time for the conference and no explanation from Mr Pieterse was placed before the court then or thereafter. The defendant was previously represented by counsel but after the withdrawal of the defendant’s legal practitioners of record, Mr Pieterse has been appearing in person. For instance, the parties’ joint proposed pre-trial order is signed by the plaintiff’s legal practitioners and Mr Pieterse in person. I am satisfied that the pre-trial conference order was served on the defendant by registered mail at the defendant’s last known postal address as is indicated in the order that the managing judge issued. Mr Pieterse was made aware of the set down trial date as appears in the pre-trial conference order.

 

[3]        Since at the commencement of the trial the defendant was not in appearance in person or by counsel (as I have said previously), as is the practice of the court, I instructed the court orderly to call the name of Lester Pieterse at least three times through the corridors of the court up to the main gate. The orderly reported that she did so and there was no response. That being the situation, Mr Van Zyl, counsel for the plaintiff, applied that I deal with the matter in terms of rule 40(1) of the rules of court. Having taken into account the aforegoing factors, coupled with the fact that action was instituted close to five years ago, I find that it is unfair to delay the trial of the matter because that would prejudice the plaintiff, particularly where there is no explanation placed before the court to account for the non-appearance of the defendant in person or by counsel. I, therefore, granted Mr Van Zyl’s application and proceeded with the trial.

 

[4]        Professor Singh and his wife Mrs Singh gave evidenced for the plaintiff. The third plaintiff witness is Mr Philip Andrew Main who gave expert evidence. Each witness gave his or her evidence forthrightly. They did not give me the impression that they were giving false testimony. I found them to be credible witnesses and their testimonies credible.

 

[5]        I find that Mr Lester Pieterse did not put himself forward as representing any Close Corporation, that is, any artificial person. Pieterse acted in person when he concluded the agreement with the plaintiff whose terms are contained in Exh A (‘the Exh A agreement’). The Exh A agreement states in a tabulated format the different phases of the construction works, the specific construction works under each phase (ie phases 1, 2, 3 and 4) and the cost of each phase. After the conclusion of the Exhibit A agreement the plaintiff and the defendant (with Pieterse acting in person) concluded a further agreement whose terms are contained in Exh B (‘the Exh B agreement’). It is a term of the Exh B agreement that phase 5 and phases 1 and 4 should be completed together. The duration of the implementation of the agreement was one year but that phases 1 and 4 must be completed by the end of July 2008. The contract price for the construction works respecting phases 1, 4 and 5 is N$1 284 275,00.

 

[6]        It is worth noting that from my finding above it is clear that the agreements were entered into between the plaintiff and Pieterse in person (as the defendant), and this is buttressed by the fact that (a) all the cheques that the plaintiff paid to the defendant indicated that the payee is Pieterse, and (b) in the agreements Pieterse signified his consent to the agreements in the following terms: ‘I, the builder, Mr Lester Pieterse .....’ In total an amount of N$1 150 000,00 was paid by the plaintiff to Pieterse personally, as aforesaid.

 

[7]        In March 2008 the plaintiff drew the attention of Pieterse to certain concerns the plaintiff had, in particular Pieterse’s failure to complete certain works within the time limit agreed by the plaintiff and Pieterse, the size of some of the buildings that Pieterse had built were small than reflected on the Windhoek Municipality–approved plans, and some materials that Pieterse had used in constructing some of the structures were of poor quality. In the face of these failures on the part of Pieterse and the defects in the works, in July 2008 the plaintiff and the defendant (acting in person) concluded a further agreement which in essence amended the Exh B agreement. The amended agreement (‘Exh J1 and J2 agreement’) indicates the intention of the parties that this amended agreement would represent the ‘final terms and conditions of the construction of Gandhi School in 1226 Dorado Park’. A key term of this amended agreement is that phase 2 of the construction works ‘will be completed by all means before 30 August 2008’ and the entire project by the end of December 2008.

 

[8]        Furthermore, the Exh J1 and J2 agreement contains a term indicating that N$1 030 000,00, which should be N$980 000,00 (as admitted by the plaintiff’s witnesses), had been paid to the defendant (ie Pieterse in person). Thereafter in July 2008 a new agreement (‘the Exh K agreement’), amending the J1 and J2 agreement, was entered into between the plaintiff and Pieterse (acting personally).

 

[9]        A meeting that was to be held between the plaintiff and Pieterse to deal with the breaches of Pieterse and connected matters did not materialize because no response to Prof Singh’s letter proposing such a meeting was forthcoming from Pieterse. Another abortive attempt was made by the plaintiff to encourage Pieterse to complete the works. The attempt was couched in an offer in a letter addressed to the defendant:

 

If you resume construction work on or before 8 September 2008 to finish the job by the end of November 2008 (this is maximum time that I can give to you in your letter). Therefore, I am requesting you to kindly take this matter seriously and resume the construction work by 8 September 2008 to avoid legal action and hassles there in.’

 

[10]      Despite this show of understanding and magnanimity by the plaintiff towards the defendant, the defendant rebuffed the plaintiff’s entreaties and did not respond to the plaintiff and never resumed work to complete the works that remained to be executed in respect of phases 1 and 2. It follows that, in my opinion, the defendant breached the terms of the agreement on account of the fact that he did not carry out the works timeously in terms of the time limits agreed by the parties, and he failed to carry out some of the works agreed under the agreement.

 

[11]      In July 2008 after the defendant had received an amount of N$170 000,00 from the plaintiff as payment for works still to be executed with regard to phase 1 and phase 2 the defendant abandoned the construction site and never returned. I must add that the plaintiff had paid the defendant certain amounts for works done in respect of other phases. For instance, the plaintiff had paid N$1 284 285,00 in respect of phases 1, 4 and 5. And I should add that the amounts were paid to Pieterse personally.

 

[12]      Accordingly, I find that the defendant failed to carry out all the works the defendant agreed to carry out in terms of the agreement, and he did not carry out some of the works within the time limits set by the parties in the agreement. The plaintiff was therefore entitled to cancel the agreement.

 

[13]      I accept the evidence of Mr Main, the plaintiff expert witness, that construction of certain structures had not been completed when he and his assistant did in loco inspection of the construction site. I also accept Main’s evidence, which was in the main confirmation of his expert report filed of record in terms of the rules of court that some of the construction works were executed in an unworkmanlike fashion. For instance, some structures that Pieterse constructed under phase 2 do not correspond with drawings supplied to him by the plaintiff and that some buildings were constructed in such a way that they were approximately 6,7 per cent smaller than what their sizes should be according to the designs supplied to the defendant. I also accept Main’s evidence that some materials used by the defendant in the construction works were not up to standard: they were of poor quality. For instance, 15 mm water pipes were used, some concrete structures and brick walls were cracking, there was some sagging of the concrete walkway for some classrooms and there appeared to be a failure of the retaining wall. It must be added that the cost that would be incurred in correcting the defects was not quantified by Main. Nevertheless, in his evidence, Main testified that in his opinion an amount of N$399 901,00 (including VAT) proposed by the plaintiff would be adequate and reasonable. I have no good reason not to accept his estimation.

 

[14]      For these reasons, I find that the plaintiff has established on a preponderance of probabilities that the plaintiff entered into the construction agreement with Pieterse personally and Pieterse was not acting for and on behalf of any artificial person, and the terms are as discussed previously. In particular, the plaintiff has also established on a preponderance of probabilities that in certain cases, the defendant failed to carry out the works in a workmanlike manner, and in some cases he did not carry out the works that he was to carry out in terms of the agreement. Furthermore, it was a term of the agreement that certain specified works were to be completed within certain specified dates and that the defendant did breach the agreement in that respect as found previously. And because the defendant failed to work to deadlines for the completion of those works in terms of the agreement, as I have said previously, the plaintiff suffered damages in the amount of N$399 901,00. This amount represents adequate and reasonable amount required for the plaintiff to get another builder to complete the works. I find also that the plaintiff has proved on a balance of probabilities damages, being income the plaintiff would have gained if the defendant had completed the works according to the deadlines for completing the school buildings. This meant that the plaintiff could not take in Grade 1 pupils for the academic year starting in January 2008, and Grades 2 to 5 pupils for 2009. And the resultant income lost amounted to N$132 000,00 in 2008 and N$528 000,00 in 2009. Added to the total of these amounts is the amount of N$399 901,00 being damages referred to in para 13.

 

[15]      For all these reasons, I make the following order:

 

(a)      Judgment is for the plaintiff in the amount of N$1 059 901,00, together with interest thereon at the rate of 20 per cent per annum, calculated from the date of this judgment to the date of final payment.

 

(b)      The cancellation of the agreement between the plaintiff and the defendant is hereby confirmed.

 

(c)      The defendant must pay plaintiff’s costs of suit, including costs of one instructing counsel and one instructed counsel.

 

 

 

 

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

C Parker

Acting Judge

 

 

APPEARANCES

 

PLAINTIFF   :                C Van Zyl

                                          Instructed by Sisa Namandje & Co. Inc., Windhoek

 

 

DEFENDANT:             No appearance

 

 

 

 


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