Phame (Pty) Ltd v Paizes

• Jurisdiction: South Africa
• Judgment Date: 07 May 1973
• Citation: 1973 (3) SA 397 (A)

Phame (Pty) Ltd v Paizes
1973 (3) SA 397 (A)

1973 (3) SA p397

Citation	1973 (3) SA 397 (A)
Court	Appellate Division
Judge	Ogilvie Thompson CJ, Holmes JA, Potgieter JA, Jansen JA and Trollip JA
Heard	March 16, 1973
Judgment	May 7, 1973

Flynote : Sleutelwoorde B

Sale — Purchase price — Reduction in — Innocent misrepresentation — Purchaser entitled to relief under the C Aedilitian remedies — Dictum et promissum — Meaning of — Purchase of shareholding in a company — Asset of company a rent-producing property — Representation false as to rates payable — Had purchaser known true facts purchase price would have been lower — Entitled to relief — Whether aedilitian relief applicable to D sale of incorporeals — Question discussed.

Headnote : Kopnota

(1) The Aedilitian remedies (actio redhibitoria or actio quanti minoris, as the case may be) are available if the res vendita suffered from a latent defect at the time of the sale.

(2) The Aedilitian remedies are also available if the seller made a dictum et promissum to the buyer upon the faith of which the seller E entered into the contract or agreed to the price in question; and it turned out to be unfounded.

(3) A dictum et promissum is a material statement made by the seller to the buyer during the negotiations. bearing on the quality of the res vendita and going beyond mere praise and commendation.

(4) Whether a statement by the seller goes beyond mere praise or commendation will depend on the circumstances of each case. Relevant F considerations could include the following: whether the statement was made in answer to a question from the buyer: its materiality to the known purpose for which the buyer was interested in purchasing; whether the statement was one of fact or of personal opinion; and whether it would be obvious even to the gullible that the seller was merely singing the praises of his wares, as sellers have ever been wont to do.

Quaere: Where there is a dictum et promissum as described in (3) above, followed by a written contract which is silent as to it, can it operate G at all, having regard to the law as to written contracts and extrinsic facts.

Semble: The current climate of opinion is propitions and receptive for the Aedilitian remedies being extended to apply to the sale of incorporeals.

In October, 1970, the plaintiff had negotiated with the defendant for the purchase of defendant's shareholding in, and certain claims against, a company. The principal asset of the company was an immovable property which was rent-producing. To the knowledge of the defendant the plaintiff H was interested in the purchase of this property because of the income derived from the property. Amongst the factors which affected the true value of the shareholding in the company were the expenses incurred by it in connection with the property, the rental which was being produced, and the potential additional rental reasonably expected to be produced. The defendant's agent represented to the plaintiff that the municipal assessment rates and other charges were R4 646. This representation was to the knowledge of the agent material. On 15th October, the plaintiff, believing the rate to be as disclosed, bought from the defendant the entire shareholding and all the directors and shareholders' claims against the company for R846 000. At the time the representation was made it was false for the company's annual liability for

1973 (3) SA p398

rates and other charges was R14 736 and had been so prior to September, 1970. Had the plaintiff known this he would not have agreed to pay the price paid as the true value of the shareholdings and claims was R815 000. By far the greater part of the price was in respect of the shareholding. The rental income was R93 480 and the expenses R18 002 per A annum. There had been an increase in rental in September, 1970, arising out of an actual increase in rates. An investor would therefore have realised, had the true facts been known to him, that potential rent increase was not likely to be achieved because it had been absorbed by the R11 500 increase of rates and the consequential very recent increase of rents. Plaintiff claimed a reduction of the purchase price by an amount of R31 000. In the alternative this amount was claimed as damages. The defendant excepted to the combined summons, which exception was dismissed. In an appeal,

B Held, that the Aedilitian relief recognised under the Roman-Dutch law could, while retaining its basic principles, be adapted to apply to the modern circumstances of this case.

Held, further, that the pleadings laid the foundation for the Aedilitian relief of a reduction of the purchase price.

The decision in the Witwatersrand Local Division in Paizes v Phame C (Pty.) Ltd., confirmed.

Case Information

Appeal from a decision of the Witwatersrand Local division (CLAASSEN, J.). dismissing an exception to a combined summons. The nature of the pleadings appears from the judgment of HOLMES, J.A.

J. C. de Wet, for the appellant: Die Hof a quo het vir sy houding gesteun op Hall v Milner, 1959 (2) SA 304; Van Schalkwyk v Prinsloo, D 1961 (1) SA 665; Overdale Estates (Pty.) Ltd. v Harvey Greenacre & Co. Ltd., 1962 (3) SA 767; Elsie Motors (Edms.) Bpk. v Breedt, 1963 (2) SA 36. Van die vier sake is dit eintlik net Hall v Milner en Van Schalkwyk v Prinsloo wat onomwonde steun verleen aan die geleerde E Regter se houding. In Overdale Estates v Harvey Greenacre en Elsie Motors v Breedt het dit slegs gegaan oor die vraag of 'n eis gegrond op onskuldige wanvoorstelling 'n actio quanti minoris is wat volgens art. 3 (2) (b) (iii) na 'n jaar verjaar, en bevind dat, indien sodanige eis bestaanbaar is, dit 'n actio quanti minoris is. In Van Schalkwyk v. F Prinsloo is Hall v Milner sonder byhaling van nuwe gesigspunte as korrek aanvaar. Die juistheid van Hall v Milner het nog nie voor hierdie Agbare Hof ter sprake gekom nie. In Breedt v Elsie Motors (Edms.) Bpk., 1963 (3) SA 525, het dit slegs gegaan oor die betekenis van die uitdrukking 'valse voorstelling' in die pleitstuk. Tot en met Hall v Milner is daar geen gerapporteerde saak waarin 'onskuldige G wanvoorstelling' as grondslag vir 'n eis om skadevergoeding erken is nie. Daar was wel 'n obiter dictum in Brink v Robinson and Wife, 1916 O.P.A. op bl. 90, waarin die retoriese vraag gestel word waarom iemand dan nie skadevergoeding by 'n onskuldige wanvoorstelling kan verhaal nie. Steyn v Davis and Darlow, 1927 T.P.A. 651, is op hierdie punt H neutraal. In Dickson & Co. v Levy, 11 S.C. 33, is wel beslis dat onskuldige wanvoorstelling nie aanleiding gee tot 'n eis om skadevergoeding nie. Daar word egter nie na gesaghebbende bronne verwys nie. In Ramon v Jackson, 1955 (1) P.H. A6, vollediger gerapporteer as Ramos v Jackson in Farlam & Hathaway, A Case Book on the South African Law of Contract, bl. 228, het die Kaapse Provinsiale Afdeling in 'n saak wat groot ooreenkoms vertoon met hierdie een, beslis dat 'n eis om skadevergoeding gegrond op onskuldige wanvoorstelling nie bestaanbaar is nie. Weer eens is nie na gesaghebbende bronne verwys nie. In die betreklik onlangse saak Hamman v Moolman, 1968 (4) S.A.

1973 (3) SA p399

340, het hierdie Agbare Hof hom in 'n rigtingewende verklaring sterk uitgespreek teen die erkenning van aanspreeklikheid selfs vir nalatige wanvoorstelling. Hou mens in gedagte dat aanspreeklikheid vir wanvoorstelling in wese aanspreeklikheid ex delicto is (sien Trotman and Another v Edwick, 1951 (1) SA op bl. 449 - 450; Scheepers v. A Handley, 1960 (3) SA op bl. 58; De Jager v Grunder, 1964 (1) SA 446 (AA), passim), dan is aanspreeklikheid vir skadevergoeding op grond van 'onskuldige' wanvoorstelling soveel te meer onbestaanbaar.

In die Romeinse reg kon skadevergoeding en selfs tersydestelling van 'n B ooreenkoms deur wanvoorstelling verkry, slegs geëis word by bedrog, d.w.s. opsetlike wanvoorstelling. By negotia stricti juris is met die actio doli opgetree - sien Jörs-Kunkel-Wenger, Römisches Recht, 3de ed., para. 62 (d), bl. 109, en para. 160, bl. 260; Kaser, Das Römische Privatrecht, band I (1955 ed.), para. 59 IV, bl. 214 en para. 146 IV, bl. 524 oor die klassieke Romeinse reg; Kaser, band II, para. 202 VII, C bl. 61 en para. 273 III, bl. 318; Van Oven, Leerboek van Romeinsche Privaatrecht, 2de uitg., bl. 322, 359; Windscheid, Lehrbuch des Pandektenrechts, 8ste uitg., band I, para. 78, bl. 343; Dernburg, Pandekten, band I, para. 104, bl. 246. By neqotia bonae fidei is met die relevante kontraksakie opgetree, en wel omdat die actio doli, infamia D meegebring het, en dus subsidiêr was. Sien Van Oven, op. cit., bl. 360; Kaser, op. cit., band I, bl. 524; Jörs-Kunkel-Wenger, op. cit., bl. 260; D. 4.3.1.1 en 4 en 6 en 7 en 8 en lex 7; C. 2.20(21).2. Of daar nou met die actio doli opgetree word of met 'n ander actio was bedrog steeds voorvereiste vir aanspreeklikheid, sien die skrywers hierbo aangehaal passim, en D. 4.3.1.2 en 3; D. 2.14.7.9; D. 4.3.37, en vgl. ook D. 2.1.7.4.

E Behalwe dat die onderskeiding tussen negotia stricti juris en negotia bonae fidei in die Romeins-Hollandse reg nie meer bestaan het nie, en bedrog ook nie meer infamia meegebring het nie, is vir skadevergoeding weens wanvoorstelling en tersydestelling van 'n ooreenkoms deur wanvoorstelling verkry, ook in die Romeins-Hollandse reg bedrog (ook genoem arglist) vereis, sien De Groot, Inleiding, 3.1.19; 3.17.3.; F 3.48.7; Groenewegen, De Legibus Abrogatis, ad C. 2.20(21).2 en ad C. 2.20(21).8; Decker se aantekening no. 1 op Van Leeuwen, Roomsch Holl. Recht, 4.42.1; Van Leeuwen, Censura Forensis, 1.1.4.42; Voet, Commentarius ad Pandectas, 4.3.1 e.v.; Van der Linden, Koopmanshandboek, G 1.14.2(c); Van Bynkershoek, Observationes Tumultuariae, 1.62; 1.112; 1.590; 2.1153; 2.1161; 2.1886; 4.3249; 4.3287.

In Hall v Milner word aanspreeklikheid vir onskuldige...