This was an appeal by a company and its liquidators against the decision of the lower court to dismiss their claim for the validity of a lease. The appellants claimed in the alternative that the decision of the respondent, the Municipal Council of Windhoek (“the council”) be reviewed and set aside.
The main issues to be determined were, whether the council had validly cancelled the lease prior to the liquidators’ election to continue with it and whether the decision of the council was open to review by the court.
The respondent contended that the cancellation was caused by the appellants’ breach of a term of the contract, by discontinuance of its textile industry. The respondent further contended that the appellants breached another term regarding sound environmental practices.
The court found that the respondent’s decision to terminate the lease was solely contractual and not administrative. On this basis therefore, the court held that the decision was not open to review on administrative law grounds.
Firstly, the court held that financial failure of a company, leading to liquidation, could not terminate a lease. Secondly, that the council failed to establish what the terms for an environmental friendly textile industry were. In conclusion, the court held that the company had in fact given notice to terminate the lease and that the notice was accepted by the respondent. Consequently, the lease had then ceased to exist.
Accordingly, the court dismissed the appeal with costs.