Court name
Supreme Court
Case number
SA 37 of 2012

Heidrun Diekmann Interior Lifestyles CC v L & B Commercial Services (Pty) Ltd (SA 37 of 2012) [2014] NASC 20 (03 November 2014);

Media neutral citation
[2014] NASC 20
Mtambanengwe AJA


NO: SA 37/2012

03 NOVEMBER 2014


the matter between:





Heard: 26
March 2014

Delivered: 3
November 2014


AJA (SHIVUTE CJ and MARITZ JA concurring):

The court a quo (the High Court) dismissed with costs the main and
alternative claims by appellant in this matter. The appellant,
Heidrun Diekmann Interior Design Lifestyle CC, appeals to this court
against the whole judgment and order of the court a quo.

The appellant (the ‘plaintiff’ below) is a close
corporation whose sole member is Ms Heidrun Diekmann. The appellant’s
main claim, as amended, was set out as follows:

At or about the end of November 2005 and at Windhoek, a written,
alternatively partly written and party oral agreement was concluded
between first, alternatively second plaintiff and the defendant. . .
. , the latter was duly represented by Heidrun Diekmann or D & F
Designs CC. The written part of the agreement is made up of annexures
‘A’, ‘B’, ‘C’ and ‘D’.

Defendant accepted liability to plaintiff for plaintiff’s
interior design fee in the amount of N$145 500 plus VAT (thus
totalling N$165 025) which was included in the detailed quote of a
close corporation D & F Designs CC as per annexure ‘A’
and whereof the total of such quote was included in the plaintiff’s
quote as per annexure ‘B’ and referred to on page 3

The aforesaid sum of N$165 025 would become due and payable upon the
completion by the plaintiff of its obligations concerning the
rendering of the interior design services.’

The alternative claim, in the event that the main claim failed, was
set out as follows:

or about the end of November 2005 and at Windhoek, a written
alternatively a partly written and partly oral agreement was
concluded between a Namibian close corporation “D & F
Designs CC” (duly represented by one D Lindemeier) and
defendant (being duly represented by Mike Böttger). The written,
alternatively written part of the aforesaid agreement is made up of
annexures “A” and “D” alternatively “A”,
“B” and “D” hereto.’

The express, alternatively implied, in the further alternative tacit,
terms of the agreement are said to be, amongst others, that:

undertook to pay an amount of N$143 500 to the plaintiff in respect
of interior design fees upon completion of such services which it is
alleged she did. It is alleged that the intention of the parties was
that D & F Designs concluded the agreement for the interior
design on behalf of the plaintiff, which was accepted by the latter
thus binding defendant. It is alleged further that by word or by
conduct the plaintiff notified the defendant that the benefit of
N$143 500 was accepted by the plaintiff as a result of which an
agreement came into existence. VAT is also claimed, making up the
total claim of N$165 025.’

The partners in Lorentz & Bone (later the directors of
LorentzAngula Inc.) first became involved with Ms Heidrun Diekmann in
August 2005, when Mr Leo Barnard, an architect who was working on the
new offices of Lorentz & Bone at Ausspannplatz, asked if she was
interested in making proposals to them (Lorentz & Bone) ‘to
do the interior of their new offices.’ Subsequently in
September 2005 she attended a meeting at the offices of Lorentz &
Bone, where Mr Barnard introduced her as an interior designer who
worked for herself.

The gist of Ms Diekmann’s evidence-in-chief was that after she
made various suggestions to the partners of Lorentz & Bone the
question arose as to ‘whether they were interested in
appointing her as an interior designer or not’. She did not say
whether the question was answered or not, but immediately went on to
say that the name of her business at that stage was Elephant Empire
Trading CC. For the past 15 years she had ‘been doing interior
designing under that name . . ., she was the sole member of that
close corporation’. Ms Diekmann described a range of activities
she undertook including visiting the old offices of Lorentz &
Bone and discussing with each partner their requirements. She also
described other work she had done, including a visit to Italy to see
and discuss the project with a furniture manufacturing company there,
a visit to South Africa to see the offices of a legal firm whose
outlay one of the partners of Lorentz & Bone had expressed
interest in, and obtaining a quotation from a firm called Home
Economix. These activities took place before she was able to draft a
quotation to supply furniture to Lorentz & Bone. That quotation,
inter alia, forms the basis of the claim that is the subject matter
of this appeal: a claim for an interior design fee.

At the time when Ms Diekmann decided to sue the defendant, L&B
Commercial Services (Pty) Ltd, for the interior design fee, she did
so in the name - and on behalf – of the appellant. At some
stage during the pleadings, she applied to be and was joined in her
personal capacity as the second plaintiff. The main and the
alternative claims dismissed by the court a quo were both in the name
of the appellant. At the time judgment was delivered, the court had
already granted absolution from the instance in respect of the claim
by Ms Diekmann as second plaintiff. She did not appeal against the
absolution judgment. The appellant thus remained the only claimant
for the said interior design fee. It is also the only appellant in
these proceedings.

The appellant’s claim against the respondent is in contract,
more in particular on a term providing for the payment of N$143 500
as an ‘interior design fee for Ms H Diekmann.’

The appellant claimed that a written agreement, alternatively a
partly written and partly oral agreement, was concluded between it
and the defendant. It pleaded that it was duly represented by Heidrun
Diekmann or by D & F Designs CC (‘D&F’) when the
agreement was concluded, and that the written part of the agreement
consisted of annexures ‘A’ to ‘D’ to its
particulars of claim. I pause here to note that the appellant
seemingly abandoned the allegation that the agreement was partly oral
and partly in writing during argument; its counsel could not refer to
any oral term of the agreement. In my view, this court should
determine the appeal on the premise that all the terms of the
agreement that are material to the determination of the issues before
us are captured in the written instruments attached to the pleadings.

That being the case, it may be useful to refer to the contents of the
annexures on which the appellant relied:

Annexure ‘A’ is a quotation by D&F to Lorentz &
Bone dated 28 November 2005 for the supply and installation of office
furniture. It was signed on behalf of D&F by one Mr D Lindemeier.

quotation, in essence, contains four items: the quoted price of the
furniture (N$1 435 000); an ‘interior design fee’ (N$143
500) for Mrs H Diekmann, which, it is common cause, is equivalent to
10% of the quoted price for the furniture; 15% Value Added Tax (N$236
775); and the total of the quotation (N$1 815 275). The furniture in
respect of which quotes were made is shown on the supplied site
layout and depicted in brochures. The quoted price for the furniture
included the items listed on a detailed invoice as well as transport,
import duties and installation costs, and was based on the exchange
rate current at the time of the quotation.

Annexure ‘B’ is a quotation from Heidrun Diekmann
Lifestyles addressed to Lorentz & Bone dated 29 November 2005.
According to its heading, it was for ‘furniture and fittings’.
It is common cause that the itemised list included not only furniture
and fittings, but also cutlery, crockery and an assortment of office
accessories, such as stationery. Immediately below the itemised list
appears the following – which, given its importance to the
discussion that follows, I shall quote in full:

amount (Heidrun Diekmann Lifestyles CC, including VAT)


VAT 102 125,32

as per detailed Quote D & F Designs including VAT 1 815 275,00

VAT 230 775,00

furniture and fittings 2 496 110,46

VAT included in the amount 338 900,32

Diekmann Lifestyles CC-

No provision made for blinds/window treatments.


and conditions:

50% with order, 50% on completion.

quotation is valid for 30 days.

& F Designs - Terms and conditions to be set out.

trust the above meets with your approval and look forward to hearing
from you.



Annexure ‘C’ is a letter from L&B Commercial Services
(Pty) Ltd addressed to ‘Heidrun Diekmann Lifestyles’
(marked for the attention of ‘Heidrun’) dated 30 November
2005 in which it confirmed acceptance of the latter’s quotation
‘for office furniture dated the 29th of November 2005’.
It further recorded that the fitting and installation of the
furniture must be completed prior to 1 March 2006.

Annexure ‘D’ is a letter from L&B Commercial Services
(Pty) Ltd addressed to ‘D&F’ (marked for the
attention of ‘Dirk & Francesca Lindemeier’) dated 30
November 2005 in which it confirmed acceptance of the latter’s
quotation ‘for office furniture dated the 28th of November
2005’. In addition, it recorded that the delivery and fitting
of the furniture for the second and third floors should be completed
by no later than 1 April 2006 and the delivery and fitting of the top
floor should be completed by no later than 10 March 2006.

It is the appellant’s case that the annexures, when read
cumulatively, evidence a single all-encompassing agreement concluded
between itself and the respondent. The respondent took issue with
that allegation and pleaded that two separate and distinct contracts
were concluded: one between the defendant and D&F by virtue of
its written acceptance on 30 November 2005 (annexure ‘D’)
of the quotation dated 28 November 2005 (annexure ‘A’)
and another between Heidrun Diekmann Lifestyles and the defendant
consequent upon the written, but separate, acceptance on the same
date of the quotation dated 29 November 2005. I pause here to point
out that although the defendant initially pleaded that the quotation
dated 29 November 2005 (annexure ‘B’) was by an entity
styling itself as Heidrun Diekmann Lifestyles ‘for the supply
of office furniture and accessories in the sum of N$680.835.46’
to Lorenz and Bone (who was not to the defendant), it later admitted
in further particulars dated 12 November 2008, that in ‘accepting
the quotation (which was not addressed to it) for the supply of
office furniture dated 29 November 2005, the defendant concluded a
contract … in the sum of N$680 835-46 plus VAT with Heidrun
Diekmann Lifestyles CC, which the defendant believed to be corporate

Having considered the pleadings, I am satisfied that although both
quotations were addressed to Lorentz & Bone, it was known that
the partnership was about to be dissolved and none of the offerees
took issue at any relevant time with the fact that the subsequent
acceptance of the quotations by L&B Commercial Services (Pty) Ltd
bound the respondent – rather than Lorentz & Bone –
as the contracting party. There I also some uncertainty about
identity and corporate status of the business or entity on behalf of
which Mrs Diekmann submitted the quotation marked ‘B’.
The quotation refers to ‘Heidrun Diekmann Lifestyles’ and
‘Heidrun Diekmann Lifestyles CC’. It is not disputed
that, unbeknown to the respondent, Elephant Empire Trading CC was
seeking to register a change of its name to ‘Heidrun Diekmann
Interior Lifestyles CC’ at the time. I shall accept for
purposes of this judgment that the uncertainty in the mind of Mrs
Diekmann about the name under which she should submit the quotation
might have resulted from the exact status of the registration process
and which one of the proposed names was or would be approved by the
Registrar of Close Corporations.

Having said that, the first, and in my view, fundamental threshold
issue to be determined is whether the respondent entered into one
comprehensive contract – as the appellant claims – or, as
it pleaded, whether two separate and distinct contracts were
concluded, i.e. one as between D&F and the respondent and the
other as between the entity represented by Mrs Diekmann and the
respondent. As I shall presently show, the determination of this
threshold issue will, in turn, bear on:

appellant’s reliance upon the doctrine of an undisclosed
principal in the law of agency to step up and vindicate its rights
under a contract concluded by an agent on its behalf;

extent to which the parol evidence rule finds application in
determining the true identities of the parties privy to the

need to consider -

appellant’s application for rectification to substitute the
reference of ‘Heidrun Diekmann Lifestyles CC’ in annexure
B for a reference to ‘Elephant Empire Trading CC’ (the
previously registered name of the appellant);

issue of estoppel raised in connection to the respondent’s
denial that the contract had been concluded with the appellant; and

appellant’s alternative claim based on the allegation that the
contract between D&F and the respondent incorporated a term for
the benefit of a third party (i.e. the appellant) and had been
accepted as such.

what follows, I shall assume in favour of the appellant that it is
entitled to the rectification sought and premise the reasoning on
that assumption.

is trite, of course, that the burden to prove the existence of the
contract, the parties thereto and the terms of the contract relied on
for the relief prayed for is borne squarely by the appellant. This
burden must be discharged on a balance of probabilities. It will not
serve any useful purpose to cite for purposes of this judgment the
many authorities underpinning this evidential approach. It is also
trite that the intention of the parties will generally be gathered
primarily from the terms of a written contract. I will also not
recite the many authorities in support of this approach.

are, in my view, a number of indiciae that militate against the
appellant’s claim that only one comprehensive contract had been
concluded if regard is had to annexures ‘A’ to ‘D’:

quotation by D&F (Annexure ‘A’) was addressed to
Lorenz & Bone; it was expressly stated to be for the supply and
installation of the office furniture to their ‘new offices’;
the hope was expressed that it would meet their favourable approval
and their response was invited. On the face thereof, this was not a
quotation submitted, as one often finds by a subcontractor and
addressed to a main contractor, for the latter’s acceptance or
rejection and possible inclusion in the main contractor’s
quotation to a client for the delivery of goods and/or services.

quotation by D&F (Annexure ‘A’) was for the supply
and installation of office furniture other than those pieces itemised
in the separate and differently dated quotation of the appellant.

terms and conditions subject to which the quotation of D&F was
submitted differed in significant respects from that of the
appellant’s quotation: the pricing of the former included
transport and was qualified by the exchange rate that applied at the
time, whereas the pricing of the latter did not include transport,
was not conditional on exchange rate fluctuations and stipulated that
50% of the quoted price had to be paid on order.

respondent confirmed acceptance of the two quotations in two separate
letters. One was addressed to D&F and the other to the appellant,
marking them for the attention of Dirk and Francesca Lindemeier and
that of Heidrun Diekmann respectively.

conditions subject to which the respondent confirmed acceptance to
the two entities differed significantly: the furniture to be supplied
by the appellant had to be fitted and installed prior to 1 March
2006, whereas the acceptance of the quotation by D&F was subject
to the conditions that the delivery of the furniture for the top
floor had to be completed by no later than 10 March 2006, and
delivery of the furniture for the second and third floors had to be
completed by no later than 1 April 2006.

arriving at this conclusion, I appreciate that some significance must
be given to the reference in the quotation of the appellant to that
of D&F, and the inclusion of the quoted amount in the latter’s
quotation as well as the ‘grand total’ appearing at the
foot of annexure ‘B’. Can it be said that this total was
included with the intention that that quotation should be subsumed by
the quotation of the appellant and that, in effect, only one quote
was submitted for approval? Or was it simply included to provide
Lorentz & Bone with a bottom line figure for the total costs of
the contemplated furnishing project if both quotes are taken into
account? In my view, there are a number of considerations that, on
the probabilities, favour the latter interpretation:

is apparent from the two letters of acceptance, each addressed to a
different entity and containing different conditions of acceptance,
that the respondent intended to conclude two separate contracts. Had
the respondent understood that the quotation of D&F was
incorporated, and in that sense, subsumed by the quotation of the
appellant, it would have sufficed to accept only the latter.

subsequent conduct of the contracting parties also suggests that all
of them understood at the time that two substantive agreements, each
with its own rights and obligations, had come into existence and
would govern the legal relationship between the parties privy to
those agreements on different terms and conditions. So, for example,
payment by the respondent was made directly to the party that
supplied the furniture or rendered the contracted service. A further
clear example is to be found in a letter dated 18 April 2006 by
LorentzAngula Inc. (presumably acting on behalf of the respondent)
addressed to the Managing Director of D&F, Mr Lindemeier, in
which it recorded a number of complaints about shortcomings in
relation to the furniture supplied and installed. The letter
proposes that D&F should only be paid ‘for what has been
delivered and installed in accordance with your quote’. It is
clear from the letter that the respondent was holding D&F
accountable (not the appellant) in terms of the agreement and that it
was proposing a compromise in relation to the payments to be made
under the contract to D&F (again, not to the appellant). Had
there been only one contract, as the appellant claimed, i.e., one
resulting from the acceptance of its quotation, there would have been
no vinculum iuris between the respondent and D&F which could be
renegotiated directly with the latter and on account of which it
could be held contractually liable. Were the appellant correct on
this point, the only parties privy to the contract would be the
appellant and respondent.

is also a further consideration affecting the probabilities for the
inclusion of a reference to D&F’s quote in that of the
appellant. Prior to the submission of annexure ‘B’, Mrs
Diekmann prepared another quote in the name of the appellant dated 28
November 2005 for Lorentz & Bone (Exhibit ‘N’). This
quotation included most of the items later enumerated in annexure ‘B’
but made no reference to the quotation of D&F and did not include
the sum total of the two quotes. She submitted this quotation to
some of the principals of Lorentz & Bone either before or at a
meeting held at the offices of the architect on that date. At the
meeting, she also submitted the separate quotation of D&F and
other options. At the conclusion of the meeting, she was pertinently
asked by one of the principals, Mr Ruppel, what the bottom line of
the furnishing expenses would be. Taking into consideration the sum
of the quotations she preferred, she said that it would be about
N$2,5 million and from his response gathered that the amount was
acceptable. It was on the basis of the discussions and decisions at
that meeting that she amended the quotation of the appellant the next
day by adding certain items and it is likely that, given the
pertinent interest expressed at the meeting in the ‘bottom
line’, she added to the amended quote the sum of D & F
Designs’ quotation to illustrate the correct approximation of
the total costs to the client as mentioned by her at the earlier

these reasons (and if I were to assume in favour of the appellant
that it stepped forward as undisclosed principal, alternatively that
annexure ‘B’ is rectified by the substitution of the
phrase ‘Heidrun Diekmann Lifestyles CC’ for the phrase
‘Elephant Empire Trading CC’), I am satisfied that two
distinct contracts were concluded: one between D&F and the
respondent and the other between the appellant and the respondent.
Alternatively, and in any event, I am not satisfied that the
appellant proved on a balance of probabilities that the accepted
quotation of D&F was subsumed in a single contract entered into
by and between the appellant and the respondent.

finding to this effect makes it unnecessary to consider the
appellant’s application for rectification. Rectification, as
pointed out, is only sought in relation to annexure ‘B’
and is limited to the substitution of the phrase ‘Heidrun
Diekmann Lifestyles CC’ wherever it may occur in that annexure
for the phrase ‘Elephant Empire Trading CC’. Even if
rectification were to be granted, such rectification would only
assist in the identification of the parties privy to the second
contract, i.e. the one that came into being by virtue of the
acceptance of the quotation submitted by or on behalf of the
appellant. There is no dispute that all payments due under that
contract have been made.

this premise, I turn to the appellant’s contention that D&F
contracted as agent for the appellant (alternatively, on behalf of
Mrs Diekmann, who in turn acted on behalf of an undisclosed
principal, i.e. the appellant) for an interior design fee of
N$143,500 and the alternative contention that the contract between
D&F and the respondent incorporated a stipulatio alterii in
favour of the appellant for the payment of an interior design fee.

law distinguishes between those contracts where a person contracts
with another as an agent for and on behalf of a principal (whether
disclosed or undisclosed) and those where a person concludes a
contract as principal with another and that contract includes an
offer or benefit open for a third party to accept. The legal
consequences of these two types of contract differ significantly,
particularly as regards the rights and obligations of the principal
in one and those of the third party in the other.

must immediately be clear from the findings that I have made earlier
that D&F submitted the quotation in its own name, and that the
acceptance of that quotation by the respondent resulted in the
conclusion of a separate contract to which D&F and the respondent
were privy. This contract was not concluded by D&F as an agent
acting on behalf of the appellant. All the rights and obligations
which came into existence upon the conclusion of the contract vested
in D&F and the respondent respectively, including the obligation
to offer the payment of a design fee of N$143 500 to Mrs H Diekmann.
This is typical of what is sometimes described as a ‘complex’
contract for the benefit of a third person (see Kerr, The Principles
of the Law of Contract (4th Ed at 72 to 73) where, prior to
acceptance there is no vinculum iuris between the third party and any
other contracting party (ibid, 77). If the third party (Mrs Diekmann)
accepts the benefit/offer a new contract would come into existence
between that party and the other contracting party (the respondent)
without derogating from the remainder of the provisions in the main
contract between the original contracting parties (D&F and the

construction is not only supported on the face of the documents and
the analysis thereof that I have done earlier, but also by the
evidence. Her evidence in chief on this aspect could not have been
clearer. Mrs Diekmann was asked by her counsel during her evidence in
chief: ‘For whose benefit was that interior design fee
included, in annexure “A”?’ Her response was as

my benefit. This fee, I had specifically said to Mr Lindemeier, I
wanted to be completely clear and transparent to the client. That
there is a fee payable and that is it. I stopped there, it was for my
benefit. So listing that,… it was for my benefit and when they
accepted the quote, I accepted that benefit because I delivered the

later, in other parts of her evidence, claimed that it was always her
intention to act on behalf of her close corporation whilst, at the
same time, seeking to keep the notion that she might have acted in
her personal capacity alive. For example, she stated during
cross-examination that her intention had always been that the
benefits would be for her close corporation ‘but if it was not
for the close corporation itself, it could only have been either for
me on behalf of the close corporation or for myself. That is why I am
the second plaintiff’. Her principal assertion that she always
intended to act on behalf of the close corporation was intended to
support her claim that the all-inclusive contract was one as between
the appellant and the respondent. The remainder of her assertion was
intended to support the alternative claim instituted in her personal
capacity as second plaintiff.

If one were to accept that it was her intention to act on behalf of
the close corporation at the time she asked Mr Lindemeier to include
the interior design fee in the quotation of D&F, it is common
cause that she did not articulate her intention in any way: she did
not disclose to him that she was making the request on behalf of the
close corporation. It is undisputed that Mr Lindemeier understood her
request to be that the design fee should be included for herself. It
is on that basis that he formulated the quotation of D&F.
Moreover, and more importantly perhaps, is the fact that the
respondent accepted the quotation on the basis that the third party
for whose benefit the stipulation of a design fee was inserted was
Mrs Diekmann, as expressly stated in the written quotation. The
obligation that the respondent ‘accepted’, therefore, was
to offer the payment of the stipulated design fee to Mrs Diekmann –
not to any other person or entity. More so, because she was the
individual whose sense of style and design style accorded with their


I appreciate that during the conclusion of whatever agreement Mrs
Diekmann may have had with D&F to include a design fee in its
quotation to the respondent, she might have acted on behalf of an
undisclosed principal (i.e. the appellant), that fact was not known
to Mr Lindemeier when he prepared the quotation. His intention had
been to include a term that would oblige the respondent to offer the
payment of a design fee to Mrs Diekmann (if it accepted the
quotation). That is the obligation in respect of which the respondent
contracted. The offer once made could therefore only be accepted by
Mrs Diekmann.

must interpose here to note that it is not necessary for us to decide
whether the offer carried with it corresponding obligations to render
design services or not, and whether those design services were in
fact rendered. This is so because the High Court granted absolution
from the instance as far as the claim of Mrs Diekmann in her personal
capacity (as second plaintiff) was concerned and there is no appeal
against that order.

summary, I take the view that:

written acceptance by the respondent (annexure ‘D’) of
the quotation addressed by D&F to Lorenz & Bone (annexure
‘A’) constituted a written contract between D&F and
the respondent;

contract was a substantive one and did not form part of any other
contract concluded with the respondent pursuant to the latter’s
written acceptance (annexure ‘C’) of a quotation by the
appellant (annexure ‘B’) in which reference was made to
the quotation of D&F (annexure ‘A’) or the sum total
of the two quotations taken together;

contract created a vinculum iuris between D&F and the respondent
which, amongst others, included an obligation to offer the payment of
a design fee to Mrs Diekmann of N$143 500;
was the common intention of the parties privy to that contract that
it would be for the benefit of Mrs Diekmann, not for the appellant or
any other person;

of the benefit of that offer (and any obligations attending to it)
resulted in the creation of a separate contract between Mrs Diekmann
and the respondent and any cause of action based on that contract
would vest only in the parties privy thereto;

was not sought in respect of either that contract or the contract
between D&F and the respondent;

the doctrine of an undisclosed principal nor the issue of estoppel
arise in respect of those contracts; and
cause of action arose for the benefit of the appellant from either
that contract or the contract between D&F and the respondent.

on my findings, the appeal must fail with costs, such costs to
include the costs consequent upon the employment of one instructing
and one instructed counsel.

order accordingly.





R Tötemeyer

by Theunissen, Louw & Partners

P de Bourbon SC

by Francois Erasmus & Partners