Boots Co (Pty) Ltd v Somerset West Municipality

• Jurisdiction: South Africa
• Judgment Date: 21 September 1988
• Citation: 1990 (3) SA 216 (C)

Boots Co (Pty) Ltd v Somerset West Municipality
1990 (3) SA 216 (C)

1990 (3) SA p216

Citation	1990 (3) SA 216 (C)
Court	Cape Provincial Division
Judge	Comrie AJ
Heard	September 15, 1988
Judgment	September 21, 1988

Flynote : Sleutelwoorde

Contract — Interpretation of — True nature of — Lease agreement between H company and plaintiff for lease of motor car to plaintiff — Subsequent, identical agreement between H company and employee of H plaintiff for lease of same car to employee — Second agreement executed for tax purposes only — Car included in employee's employment package — Arrangement between plaintiff and employee regarding the car adhered to up to time when car finally sold to third party — No intention as between H company, plaintiff and its employee to substitute or innovate first agreement with second — First agreement representing true I intention of parties; second a simulated document produced to mislead fiscus, if required, and not intended to bind H company, plaintiff, or employee.

Negligence — What constitutes — Collision between right-turning vehicle and overtaking vehicle — Truck, having timeously indicated J intention to turn right and having already initiated such turn struck by

1990 (3) SA p217

A motor car attempting to pass — Speed of truck at moment of collision 5 — 10 kph — Roadworks having been in progress along roadside — Noticeboards having been erected imposing speed limit of 30 kph — Driver of truck reasonably entitled to assume that motorist (of whose presence he had been aware) had seen his signal and would respect it — Truck not obliged to stop before making right turn as there had been no B oncoming traffic and no indication from car of intention to pass — Driver of truck on facts not negligent — Driver of motor car negligent in having given no indication of intention to overtake, in failing to keep a proper lookout and in overtaking at a time when unsafe and inopportune. C

Headnote : Kopnota

A truck driven by J, an employee of the defendant, had been involved in a collision with a motor car driven by N, an employee of the plaintiff. J, having signalled his intention to do so, and after having gradually reduced his speed to approximately 5 - 10 kph, had initiated a right turn when the car (the presence of which J had been aware) had hit the truck in attempting to overtake it. There had been no oncoming traffic and N had given no indication of his intention to overtake. Construction work had been in progress along the roadside and noticeboards warning of D roadworks and imposing a 30 kph speed limit had been set up. The plaintiff alleged that J had through his negligence been solely responsible for the collision. This was denied by the defendant, which in turn averred that the collision was caused solely by N's negligence. The plaintiff claimed that, in terms of a lease agreement between it and the H company, it was the legal possesor of the motor car and that it was liable for risk of damage to the vehicle. The defendant disputed E this, alleging that the plaintiff therefore had no locus standi. Two virtually identical lease agreements relating to the same car were produced before the Court, the earlier one between H company and the plaintiff, the later one between H company and N. The plaintiff averred that the second agreement had been executed for 'tax purposes' only, the prior arrangement between the plaintiff and N (in terms of which the car formed part of N's employment package) having been adhered to up to the time when the car had finally been sold to a third party. The plaintiff F furthermore averred that the second agreement did therefore not constitute a genuine and binding contract, the only true agreement being the one between the plaintiff and H company. The issues before the Court were thus (1) whether the first agreement constituted the only true contract between the parties, and (2) whether either one of the drivers, or both, had negligently caused the accident.

G Held, as to (1), that there had been no intention as between H company, the plaintiff, and N to substitute or innovate the first agreement with the second one, the second one being a simulated document produced to mislead the fiscus, if required, and not intended to bind either H company, the plaintiff, or N.

Held, further, that the first agreement represented the true intention of the parties, and that the plaintiff consequently had locus standi.

Held, as to (2), that the law generally placed a stringent duty on drivers that turn out of their path of travel, whether to left or right, H and a less onerous duty on the following motorist who wishes to overtake.

Held, however, that J had been reasonably entitled to assume that N had seen his signal and would respect it, and that J had in the circumstances (the road having been clear) not been obliged to stop before making the turn.

Held, further, on the facts, that J had not been negligent.

Held, further, that N had negligently caused the collision: he had I undertaken what was under the circumstances a dangerous manoeuvre; he had given no indication of his intention to overtake, had failed to keep a proper lookout and had overtaken at a time when it had been unsafe and inopportune to do so.

Held, accordingly, that the plaintiff's claim had to be dismissed with costs.

Case Information

Civil trial in an action for damages. The facts appear from the reasons J for judgment.

1990 (3) SA p218

A E N Keeton for the plaintiff.

D J van der Walt for the defendant.

Cur adv vult.

Postea (21 September 1988). B

Judgment

Comrie AJ:

On 15 October 1986 at approximately 08:25 and at or near the intersection between the old Stellenbosch Road and Helena Avenue, Somerset West, a red Volkswagen Jetta motor car was in collision with a large 8-ton tipper truck which was owned, it would seem, by the defendant, the Municipality of Somerset West.

C The Jetta was being driven by one Henry Nel, who was then a medical representative employed by the plaintiff company. It was admitted that he was acting in the course and scope of his employment by plaintiff. The truck was being driven by one Julies who, it was admitted, was employed by the defendant and was acting in the course and scope of his employment.

D The Jetta was damaged and the agreed quantum of the damages amounted to R13 125,20. Nel and his young daughter were injured and, according to the evidence, there is a third party claim by them in a separate action. In the present action the plaintiff claims damages in the amount of R13 125,20, alleging that the collision was caused solely by the negligence E of Julies in one or more of several respects.

The defendant denies that the collision was caused by the negligence of Julies or that Julies was negligent and avers that the collision was caused solely by the negligence of Nel in one or more of several respects.

If I were to find that both Nel and Julies were contributorily F negligent, then, subject to the question of locus standi, it is common cause that there would have to be an apportionment of liability. Therefore, the issues which I am required to decide are those of negligence on the part of Nel and/or Julies, causation and the third question of locus standi. The third issue arises in the following way.

Plaintiff claims that it was the legal possessor of the Jetta in terms G of a lease agreement between it and a company known as Hertz. In terms of that lease the plaintiff was liable for risk of damage to the vehicle, fair wear and tear excluded. Defendant did not admit this allegation. I propose to deal with this last issue first. In what I say I will refer for convenience to the plaintiff as Boots.

H Two lease agreements were produced. One between Hertz and Boots and the other between Hertz and Nel. The two agreements were virtually identical except for certain dates. The Hertz/Boots agreement was the first in time. It was accepted that the Hertz/Boots agreement was genuine at the time when it was executed. Nel testified that he was entitled to the use of a company car as part of his employment package I and that the car would be provided to him at the expense of Boots, his employer. He said that the first lease agreement was between Hertz and Boots and that he was not party to that agreement. He testified that he was asked to sign the second agreement between Hertz and himself purely for administrative purposes, which really meant for tax purposes. His evidence was that nothing really changed in the arrangements between J himself and his employer. Boots

1990 (3) SA p219

Comrie AJ

A continued to pay the car hire and the insurance, as they had done before. He, Nel, understood that the Hertz/Nel agreement was not a genuine agreement. This he was told by his employer and that it was to be executed, as he put it, just for administrative purposes. When Nel left the employment of Boots at the end of January this year he returned B the Jetta and the log book to Boots and not to Hertz.

Owen is the financial director of the plaintiff and familiar with that company's policy in regard to cars. He says that the first agreement was signed by a Mr Milner on behalf of Boots and Milner is now overseas. Owen stated that the true agreement was the Hertz/Boots agreement. They had many similar agreements with Hertz in respect of other vehicles, but C he explained that in 1985/1986 various changes were made to the tax laws affecting what were called fringe benefits. These changes, which were themselves then amended, included tax payable on the use of company cars. He said that there was a period of doubt when it was not known whether it would be more favourable to employees, such as Nel, from a D tax point of view for the employer company to provide a company car for the use of the employee, as Boots had done...