Couws v Jester Pools (Pty) Ltd

• Judge: Cillié J and Jansen J
• Judgment Date: 05 July 1968
• Citation: 1968 (3) SA 563 (T)
• Hearing Date: 02 September 1966
• Court: Transvaal Provincial Division

Jansen, J.:

The appellant and respondent were defendant and plaintiff respectively in the magistrate's court. The defendant appeals against a judgment given in favour of the plaintiff in the sum of R1,000 and costs.

D The plaintiff's particulars of claim read as follows:

'1.

At all material times hereto, the plaintiff was under the bona fide and reasonable belief that one M. Wolf was the owner of certain Stand 1857, Bryanston, Johannesburg, situate at the corner of St. Audrey and Grosvernor Roads, Bryanston (hereinafter referred to as the said 'stand').

2.

On 12th November, 1964, the plaintiff and the aforesaid M. Wolf entered into a written agreement in terms whereof the plaintiff undertook to construct a swimming pool on the said stand for the sum of R1,640.

3.

E The plaintiff duly constructed a swimming pool on the said stand in accordance with the aforesaid agreement.

4.

The defendant on or about the month of January, 1965, as the owner of the said stand, repudiated the authority of the aforesaid Wolf and took possession of the said stand.

5.

The construction of the swimming pool by the plaintiff as aforesaid was a useful improvement to the said stand in an amount of R1,000, the F said sum being the amount of the plaintiff's actual expenditure in constructing the said swimming pool and the amount by which the said stand has been enhanced in value by reason of the construction of the swimming pool thereon.

6.

The defendant has accepted the benefit of the construction of the aforesaid swimming pool on the said stand and in the premises the defendant has been unjustly enriched at the plaintiff's expense in the G sum of R1,000 but notwithstanding demand the defendant has failed, refused or neglected to pay to the plaintiff the said sum of R1,000 or any portion thereof,

Wherefore the plaintiff prays for judgment against the defendant for:

(a)

payment of the sum of R1,000,

(b)

costs of suit.'

To these particulars the defendant pleaded no knowledge of the allegations in the first three paragraphs and put the plaintiff to the H proof thereof; the remaining paragraphs (in terms of an amended plea) he denied.

On the evidence the magistrate found the following facts proved:

'1.

At all material times the defendant was the registered owner of Stand No. 1857, Bryanston, until 5/4/1965 when it was transferred into the name of Mrs. Cogen.

2.

On 12/11/1964 the plaintiff firm represented by Mr. Lang entered into a contract with Mr. M. Wolf for the construction of a swimming pool on Stand 1857.

3.

This contract was signed by Mr. Wolf as owner of the stand and at all

Jansen J

times during the construction of the pool and until it had been completed the plaintiff company bona fide and reasonably believed Mr. Wolf to be the owner of this stand.

4.

The defendant was not a party to the contract and had nothing to do with the construction of the swimming pool.

5.

The pool was duly constructed in terms of the contract, exh. 'C'.

6.

Plaintiff's actual expenses in constructing the pool amount to R1,249.59.

7.

A Construction of the swimming pool is a useful improvement which enhances the value of the stand by at least R1,000.

8.

The defendant accepted the benefits of the construction of the swimming pool.

9.

After completion of the swimming pool and by virtue of a deed of sale dated 16/1/1965, the defendant sold the said Stand 1857 to a Mrs. Cogen, transfer being passed in her name on 5/4/1965.

10.

B The defendant was unjustly enriched to the extent of at least R1,000 at the expense of the plaintiff.'

On this factual basis the magistrate gave the judgment mentioned above. But for a full understanding of the problems involved it is necessary to refer to some of the circumstances in greater detail.

In this regard the defendant's evidence, which has not been C contradicted, is of some importance. The gist of it, in the light of certain accepted facts, is as follows: In 1963 he and his two brothers, J. F. and L. M. Gouws, each had an interest in and was a director of Riteway Construction Company, a company formed to construct dwelling houses for the purpose of speculation. The directors bought 'plots in their personal names as it was easier to obtain bonds from the building D society in one's private name', although they were actually the nominees of the company. One such plot (out of a total of about 100) was Stand 1857, the stand in question, purchased in about October, 1963. The purchase price of about R2,000 was paid by the company, but the E defendant, in his own name, took transfer and obtained a bond in the vicinity of R12,000 from a building society. He is not certain as to when he applied for the bond, but is of the opinion that the bond and transfer into his name occurred simultaneously. In any event it is clear (see exh. 'D') that transfer was registered on 4th March, 1964. During F the first half of March, 1964, the defendant, by verbal agreement, severed his connection with the company and sold his interest. Apparently his brother, L. M. Gouws, did the same, as 'J. F. Gouws remained the sole interested party'. The defendant was to share in the profits from 'completed projects' but not from 'uncompleted projects'. These 'were to be left to Mr. J. F. Gouws to be completed and all the proceeds were to be his'. The defendant

'had an undertaking with Mr. J. F. Gouws that when the plots registered in my name are sold I would sign all the documents and deeds of sale'.

It is clear that the defendant would have remained personally liable under any bond vis-à-vis the building society, but he had the security of the property being registered in his name. The arrangement was G apparently that the bond would be paid out of the proceeds of any sale and the balance paid over to J. F. Gouws or Riteway Construction Company or Probro Company (a further company of which J. F. Gouws became a director). Under this arrangement the defendant's only practical concern with 'uncompleted projects' would have been to see that the purchase price in any deed of sale in respect of a stand registered in his name as nominee of Riteway Construction Company and bonded to a building society, was sufficient to cover the bond:

'The stands registered in my name were his (J. F. Gouws') houses on stands

Jansen J

and he could do with them what he pleased. All interest I had was to see that bonds were redeemed.'

It is not clear who paid interest on any such bond or any instalments, A but it seems probable on the defendant's evidence that he did not do so and it was never suggested to him that he did. On the defendant's evidence Stand 1857 was one of the uncompleted projects. He was informed that the house on it had been completed 'towards November, 1964'. On 3rd December, 1964, he signed a deed of sale in respect of Stand 1857 at the request of J. F. Gouws. This deed is exh. 'A'; the purchaser is Max B Wolf; the price R17,000; possession and occupation to be given on 7th December, 1964; a building society or bank guarantee to be provided within 21 days, subject to cancellation if it be not done. A condition precedent was that Max Wolf sell to Messrs. Probro Limited 'his entire shareholding in a certain company known as Drumma-Drochit Investments C (Pty.) Ltd.' (Ex facie the contract imposes this obligation on the 'seller'; but this is obviously a mistake: a draft agreement between Wolf and Probro re these shares appears as exh. E, also signed by M. Wolf on 3rd December, 1964). The defendant was subsequently asked to sign a further deed of sale in respect of the property. In regard to the previous sale to Wolf he says:

'I believe the sale was cancelled because the transaction between me and D Wolf fell through. I never cancelled the sale. Yes, I did enquire from my brother what happened to the sale to Wolf. Yes, I was told that he had disappeared . . . No, I don't know what had happened to the sale to Wolf. It is obvious he has no claim to the property at this stage because the guarantees were never supplied. I don't know whether guarantees were supplied. If the guarantees were supplied and Wolf calls on me to transfer I would be in trouble.'

E This further deed was an 'offer to purchase, through the agency of Riteway Estates (Pty.) Ltd.', Stand 1857, for the sum of R16,350, an offer by Mrs. L v Cogen. The defendant accepted this 'offer' by signing as 'owner' on 16th January, 1965. Clause 10, handwritten in ink and initialled by the defendant, provided:

'Property is purchased with existing swimming pool and filter plant.'

The defendant says:

F 'It did not strike me as strange that it had a swimming pool on it.'

He explains that pools were constructed on other properties bought on behalf of Riteway Construction Company.

Transfer was given to Mrs. Cogen on 5th April, 1965. According to the defendant the bond was paid out of the proceeds and, as to the balance, he remembers

G 'signing a letter making over the proceeds of the sale less amount of the bond to either my brother, Probro or Riteway Construction Co.'

On the defendant's evidence he was in no way directly concerned with any improvements on Stand 1857 or with any of the two sales of the property. His only concern was that the bond be paid - otherwise he left H everything to his brother, J. F. Gouws, and signed whatever documents were required by the latter. He never saw Wolf, Mrs. Cogen or the pool at any material time.

It is against this background that the magistrate found that the defendant was not a party to the contract with the plaintiff 'and had nothing to do with the construction of the swimming pool'. In regard to his finding that the defendant 'accepted the benefits of the construction of the swimming pool', the magistrate points out that

'though the defendant was never in occupation he was at all times...