Henri Viljoen (Pty) Ltd v Awerbuch Brothers

• Jurisdiction: South Africa
• Judge: Horwitz AJP and Van Blerk J
• Judgment Date: 15 January 1953
• Citation: 1953 (2) SA 151 (O)
• Court: Orange Free State Provincial Division

E Horwitz, A.J.P.:

At the instance of several traders carrying on business at Bloemfontein, one of the directors of the applicant company and representatives of two other local firms convened a meeting of Bloemfontein retail merchants, which was held at the Ramblers Club on F the 30th April, 1952. The meeting was attended by some 60 local traders, including representatives of the applicant company and the respondent. From the minutes of this meeting (annexure C (ii) to the petition) it would appear that the discussion first centred around an alleged threat emanating from 'S.A.M.B.A.' to cancel its contracts with G traders who contracted also with other buying organisations. This led to the expression of various views, such as that commerce must serve all sections of the community without discrimination and that traders would not allow themselves to be intimidated. Thereafter the advisability of withdrawing from all buying-aid organisations was discussed, and ultimately a resolution was taken which will be referred to in detail H later herein.

It appears from the documents before the Court that there is in existence in Bloemfontein, and elsewhere in the Union, a number of consumers' organisations known, generally, as Mutual-Aid or Buy-Aid Organisations. The principal function of such organisations is to enter into contracts with traders in terms whereof the contracting traders undertake to supply goods to the members of

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the organisations concerned on the basis that the purchase price of such goods, less a contractually agreed percentage discount, is charged to the organisation of which the purchaser of the goods is a member. The organisation, in turn, debits the members with the full purchase price A of the goods so bought, but pays the trader that purchase price less the covenanted discount. The discounts so allowed accrue, in the first instance, for the benefit of the organisation. They are, presumably, first appropriated towards the payment of the expense of administration incurred by the organisation. A portion of the discounts received is B distributed annually to the members of the organisation in the form of a bonus based on the proportion of a member's purchases during the year to the total purchases of all the members during the corresponding period. The balance is accumulated by the organisation for the purposes C of establishing reserves and for divers other purposes. The organisations which operate in Bloemfontein on the basis very broadly outlined above are: Samba (Ko-operatief) Beperk, Springbok Discount Agency, Savings Aid, Bloemfontein Police Dry Goods Canteen and Bloemfontein Prisons Officers Benefit Association.

D To revert to the meeting held at the Ramblers Club, the discussion thereat led to a call for a lead from three of the leading departmental stores in the city, 'The Big Three'. After such a lead had been obtained, the meeting came to a unanimous decision to withdraw from or E discontinue contracts with the buying organisations. A resolution to give effect to the views of those present was hurriedly drafted in the following terms:

'We the undersigned hereby agree that under no circumstances whatsoever will we tender to supply any one or other of the existing or prospective buying organisations in Bloemfontein. This agreement to be effective for a period of ten years. The following associations are F covered: Springbok Discount Agency, S.A.M.B.A., Savings Aid, B.F.D.G.B. Prisoners Association.'

All those present at the meeting, including respondent, signed this undertaking.

After this resolution had been taken, a proposal was put forward that an G association be formed to cater for the domestic requirements of traders in Bloemfontein and, generally, to take care of any work that might arise out of the above resolution and agreements.

'It was agreed in principle that such an association should be formed and the meeting appointed a caretaker committee'

H of six persons. At the first meeting of this committee it was announced that certain firms, whose representatives had signed the above undertaking subject to the confirmation by their head office, had since intimated verbally that the confirmation had been received. The committee felt also that the agreement of the 30th April, 1952, 'had been drawn very hurriedly at the meeting and was moreover in English only', whereas it was preferable to have an agreement phrased in both official languages.

'Moreover, there were some firms which had not been represented at the

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inaugural meeting and which had indicated willingness to join in the agreement. It was desired to obtain signatures from those concerns.'

For these reasons the committee decided

'that it would be desirable to draw up an agreement and have it re-signed by those who had already signed on the 30th April, 1952, and to obtain signatures from those who had subsequently indicated willingness to join in the agreement'.

A In accordance with this decision of the committee, an agreement was drafted and roneoed forms including its terms were taken round by members of the 'caretaker' committee to various firms for signature or re-signature, as the case may be. On the 5th May, 1952, respondent B signed such a form and his signature was duly witnessed by the secretary of the caretaker committee. The form contained the following:

'At a fully representative general meeting held on the 30th April, 1952, at the Ramblers Club Committee Room, the firms whose names appear on the reverse side, being contractors to Mutual Aid and Co-operative Buy Aid Organisations, agreed to discontinue being C contractors to all existing such organisations for a period of ten years from date.

These firms also agreed to make every effort to cancel all existing contracts extending beyond the 15th August, 1952, or 15th October, 1952, as the case may be, but if unable to cancel these outstanding commitments, they will not be renewed upon expiry date.

I/we the undersigned hereby undertake that I/we bind myself/ourselves to honour and support the above agreement and undertaking.

D At the present time I/we have contracts with the following organisations:

Name of Organisation		Expiry Date
S.A.M.B.A. (Ko-op.) Beperk.; Bloemfontein Police Dry Goods Canteen.; Bloemfontein Prison Officers Benefit Association.; Savings Aid.		15/8/52.; 30/6/52.; 15/8/52.; 15/10/52.
Date 5/5/52	Awerbuch Bros.; Name of Firm.; for Awerbuch Bros.; J. H. Awerbuch
Witness: H. Solomon	Signature.'

The name of the respondent firm was included in the list on the reverse side of the form as a signatory to the agreement of the 30th April, 1952.

G It is common cause between the parties that, notwithstanding the undertakings referred to above, respondent renewed his contract with Samba on the 15th August, 1952, and that, at the time of the institution of these proceedings, he was implementing the renewed contract and advertising, and holding himself out to the public at large, that he H still is a contractor to Samba. In these circumstances the applicant has moved this Court for an order in the following terms:

'1.

An order restraining respondent from

(a)

implementing or executing or performing his present contract with Samba, or in any way supplying goods to members of Samba as such;

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(b)

advertising or holding himself out to the public as a contractor to Samba;

(c)

entering or renewing or implementing as aforesaid any contract with any other Buy-Aid Organisation such as is described in para. 3 of the petition;

A for a period of ten years as from 30th April, 1952.

2.

Such further or other order as to the . . . Court may seem fit.

3.

Costs.'

B Mr. Gould, on behalf of respondent, raised two objections in limine, both based on non-joinder. He submitted, first, that the applicant was bound to join all the members of the traders' association or, at least, those traders who had signed the agreement of the 30th April, 1952. The second objection was that applicant could not proceed C with the application without joining Samba formally as a co-respondent.

On the first objection Mr. Gould advanced the argument that the agreement of the 30th April, 1952, was a joint agreement between the sixty contracting parties in the sense that each promisor bound himself D to all the other covenantees collectively, as a group, entity or body, to implement its terms; each promisor, it was contended, did not bind himself to each of the other contracting parties individually or separately. It was conceded, however, that the objection fell to be decided as a matter of construction of the agreement, that is, whether E it was a joint agreement, or a joint and several undertaking, or a series of several agreements with each of the parties separately and individually, or a solidary promise by each signatory to all the other covenantees regarded as an entity or unit.

F One must, in my view, eliminate the possibility that the undertakings here by a plurality of promisors towards a plurality of promisees were either joint or joint and several undertakings. The obligation undertaken by respondent, and the like promise made by each of the other signatories, could only possibly be joint or joint and several if each G covenantor bound himself for the same performance. For, where there is a joint obligation, an individual promisee is entitled only to a rateable or aliquot share of the performance of the single obligation. Again, where the obligation is joint and several, a promisee is entitled to a single performance, and a promisor, who performs the act promised, absolves the other co-promisors from the whole obligation. In other H words, an obligee can claim the entire performance of the solitary obligation from any of the obligors, but...