Pretorius v Agricultural Research Council

• Jurisdiction: http://justis.com/jurisdiction/166,South Africa
• Judge: Schippers JA, Carelse JA, Mabindla-Boqwana JA, Goosen JA and Molefe JA
• Judgment Date: 29 May 2023
• Citation: 2023 JDR 1783 (SCA)
• Hearing Date: 18 May 2023
• Docket Number: 250/2022
• Court: Supreme Court of Appeal

Schippers JA (Carelse, Mabindla-Boqwana, Goosen and Molefe JJA concurring):

[1]

This is an appeal against an order of the Gauteng Division of the High Court, Pretoria (the high court), directing the appellant, Mr Daniel Nel Pretorius (the defendant), to pay the sum of R439 300.92 together with interest and costs to the respondent, the Agricultural Research Council (the plaintiff), in respect of arrear amounts owing under a lease agreement. The high court (Louw J) also dismissed the defendant's counterclaim for payment of R4 860 000 for lost profits, with costs. The appeal is with its leave.

[2]

The basic facts are largely common ground and can be briefly stated. On 1 August 2001 the parties concluded a written lease agreement in terms of which the plaintiff let a farm known as Plot 103, Kameeldrift, Pretoria (the property), to the defendant for a period of nine years and 11 months, which commenced on 1 August 2001, terminating on 30 June 2011 (the initial agreement).

2023 JDR 1783 p3

Schippers JA (Carelse, Mabindla-Boqwana, Goosen and Molefe JJA concurring)

[3]

The initial agreement contained the following terms. The defendant would be invoiced for rental (R350 per hectare per year with an annual escalation of 10% on the ground only) during March of every year, ending on 31 March. The rental invoice had to be paid by no later than 31 May of each year. The defendant was given an option to renew the lease, subject to the express condition that the right of renewal could not be exercised while he was in breach or default of any of the terms of the agreement.

[4]

At first the rental was paid annually in accordance with the terms of the initial agreement. However, that changed when the defendant made arrangements with the plaintiff to make frequent payments during the course of the year, instead of paying an annual amount. The defendant fell into arrears with his payment obligations and on 13 October 2009, the outstanding balance owed to the plaintiff was R206 219.43. Consequently, the defendant signed an acknowledgement of debt (AOD) on 2 November 2009, in terms of which he admitted that he was indebted to the plaintiff in respect of municipal services to the property in the sum of R206 219.43. The defendant paid this amount in instalments to the plaintiff.

[5]

Subsequently, the defendant again fell into arrears with his payment obligations under the initial agreement. On 15 October 2010 he signed a second AOD in terms of which he acknowledged his indebtedness to the plaintiff in the amount of R203 043.95, in respect of municipal charges (the second AOD). The defendant undertook to pay this amount by way of a minimum monthly instalment of R20 000 and to settle the outstanding balance by 31 March 2011. The first monthly instalment was payable by 25 November 2010 and each subsequent instalment had to be paid on or before the 25th day of each succeeding month, until the arrears and interest were paid.

2023 JDR 1783 p4

Schippers JA (Carelse, Mabindla-Boqwana, Goosen and Molefe JJA concurring)

[6]

On 25 November 2010, whilst in arrears with his obligations under the initial agreement, the defendant purported to exercise the option to renew that agreement in writing. The plaintiff therefore contended that the purported renewal was of no force and effect, and that the initial agreement came to an end by the effluxion of time on 30 June 2011.

[7]

After 30 June 2011, the defendant continued to occupy the property. The plaintiff's case was that this occupation was in terms of a month-to-month agreement. The defendant denied this. He claimed that the initial agreement had been renewed and that he was entitled to occupy the property until 31 May 2021.

[8]

On 28 March 2014 the plaintiff's attorneys informed the defendant that the plaintiff had cancelled the lease agreement, gave him notice to vacate the property by 30 July 2014, and demanded payment of arrear amounts arising from his lease of the property in the sum of R439 300.92. The defendant's response to the termination notice was that it was a repudiation of the agreement, which was not accepted, and he tendered payment of the arrears. On 20 June 2014 the defendant issued the plaintiff with a cheque for the arrears in the sum of R439 300.92. When the plaintiff presented the cheque for payment, it was dishonoured – the defendant had stopped payment.

[9]

The plaintiff then sued the defendant in the high court for payment of arrear rental in the amount of R502 707.84, founded on an alleged month-to-month lease agreement; alternatively, for payment of R439 300.92 based on the dishonoured cheque. The defendant brought a...