HIGH COURT OF SWAZILAND
ENGINEERING (PTY) LTD
POLYSTYRENE PRODUCTS (PTY) LTD
Case No. 3251/2001
MAPHALALA - J
the Applicant Advocate P. FLYNN (Instructed
the Respondent Advocate G.D. Goddard
by Millin & Currie)
matter came as an ex parte application sometime in December 2001,
under a certificate of urgency for an order as follows:
with the usual forms and procedures relating to the institution of
proceedings and allowing this matter to be heard as a matter of
payment of the arrear rentals and other charges in the sum of El 19,
229-45 (one hundred and nineteen thousand two hundred and twenty nine
emalangeni forty five cents) claimed by the Applicant from the
Respondents in respect of the premises at Lot 521, Matsapha
Industrial Sites, Matsapha (the premises), for the period between
February 2001 to November 2001, the removal of any movables from the
said premises is hereby interdicted.
Sheriff or his lawful Deputy is hereby directed and required:
to serve the Notice of Motion and this Order upon the Respondent and
to explain the full nature and the exigency thereof to it.
all the movables upon the premises, and;
an inventory thereof;
a return to the Applicant's attorney and the Registrar of what he has
done in the execution of this Order.
Applicant's claim based on the allegations in the founding affidavit
of the arrear rental and other charges in the amount of El19, 229-45
(one hundred and nineteen thousand two hundred and twenty nine
emalangeni forty-five cents).
of the Respondent and all those holding through or under it from the
on the sum of El19, 229-45 (one hundred and nineteen thousand two
hundred and twenty nine emalangeni forty-five cents) at the rate of
9% per annum from the date of service of the application to date of
application was founded on the affidavit of one Antonio Marques Ramos
who is a Director of the Applicant and the said affidavit is
supported by various annexures pertinent to the Applicant's case.
Respondent joined issue and filed an opposing affidavit of one
Terence Paul Smith who deposed to the said affidavit in his capacity
as the General Manager of the Respondent's Swaziland operation.
Applicant then filed a replying affidavit of Mr. E. Ramos.
matter appeared before me on the 12th December 2002, where I heard
arguments from counsel. Both counsel filed very useful Heads of
Arguments for which I am greatly indebted.
Applicant is a company duly incorporated in accordance with the
company laws of the Kingdom of Swaziland with its principal place of
business at Matsapha Industrial Site, Matsapha.
Respondent, is also a company duly incorporated in accordance with
the company laws of the Kingdom of Swaziland, whose chosen domicilum
citandi et executandi is Lot 521 Matsapha Industrial Sites, Matsapha.
cause of action
about the 15th August 1998, and at Matsapha the Applicant represented
by Mr. Ramos entered into a written lease agreement with the
Respondent in terms whereof the Applicant let to the Respondent who
hired the premises described as Lot 521, Matsapha Industrial Sites,
Matsapha ("the premises").
material terms of the aforesaid lease were inter alia that:
lease shall commence on 1st July 1991, and endure for a period of 5
years from the commencement date.
rental payable by the Respondent to the Applicant shall be for the
first year E21, 000-00 per month, for the second year E23, 520-00 per
month, for the third year E26, 342-40 per month, for the fourth year
E29, 503-49 per month, for the fifth year E33, 043-90 per month.
rental shall be payable not later than the 7th day of each and every
addition to the rental, the Respondent shall bear the costs of all
water and electricity used by it on the property and for all services
provided by the local authority.
the Respondent fail to pay any amount due by it on the due date the
Applicant shall have the right.
forthwith cancel the lease and to resume possession of the premises,
but without prejudice to its claim for arrear rental and other
amounts owing in terms of the lease.
the event that the Applicant cancel the lease and the Respondent
disputes the right to cancel and remain in occupation of the premises
pending the determination of such dispute, then and notwithstanding
the Applicant's contention that it has cancelled the lease:
Respondent shall continue to pay all amounts which would have been
due to the Applicant in terms of the lease on the date which amount
fell due, not withstanding such cancellation;
applicant shall be entitled to recover and accept such payments;
acceptance by the Applicant of such payments shall be without
prejudice to and shall not in any way affect the Applicant's claim to
have cancelled the lease or to any other remedy which it may have
arising out of such cancellation;
the dispute between the Applicant and the Respondent be determined in
favour of the Applicant, those payments made to the Applicant in
terms thereof shall be regarded as amounts paid by the Respondent on
account of damages sustained by the Applicant as a result of the
holding over by the Respondent of the leased premises and shall be
regarded as proper recompense to the Applicant in respect of any
damages suffered for the holding over of the leased premises in
relation to loss of rental.
leased constitutes the entire agreement between the Applicant and the
Respondent any variation to the lease must be in writing and signed
by the parties to the lease.
applicant went further in his affidavit to expand on the background
events which occurred between the Applicant and the Respondent during
2001. Applicant avers that during or about February 2001, the
respondent through its Manager Mr. Terry Smith approached the
Applicant as represented by the deponent with a view to reducing the
Respondent's rental due to the fact that Fridgemaster had gone into
liquidation which had a consequent effect on the Respondent's
business. He agreed that the rental would be temporarily reduced but
without prejudice to the Applicant's
to be paid in full in respect of the rental due to it. On this point
the Respondent in its answering affidavit avers that it is correct
that during or about February 2001, Mr. Terry Smith approached Ramos
with the view of reducing the Respondent's rental. His understanding
was that, in the circumstances in which the Respondent found itself,
Mr. Ramos did agree that the Respondent's rental could be reduced. He
cannot dispute that Ramos thought that payment of a portion of rental
was merely being deferred, and that this would be temporary, but this
was not his understanding.
above arrangement was confirmed by the Respondent through a letter
addressed to the Applicant to the Respondent signed by a Mr. Peter R.
Van Duyn dated the 15th February 2001. The letter was delivered to
him by Mr. Terry Smith. When he delivered the letter he told him that
he did not accept the contents of the letter unless it included
Respondent's undertaking to pay the difference between the actual
rental and the amount of E16, 000-00. He then in his own handwriting
added the words "with the remainder to be paid at the earliest
opportunity" and he asked him to send a letter with those words
included in the letter. This was never done by the Respondent or its
associated companies Isolite and Isowall. The said letter is annexed
"B". The Respondent's response to this is that he does not
recall Ramos telling him that he did not accept the contents of Van
Duyn's letter and he does not recall further Ramos adding the
handwritten notation "with the remainder to be paid at the
earliest opportunity" to the letter asking him for an amended
Applicant avers that the said letter was not signed by himself on
behalf of the Applicant and it is not bound by the contents of the
letter, as any variation to the lease would have been signed by both
parties to have any force or effect under the lease. Applicant
accordingly submits that the Respondent is liable in respect of the
arrear rentals due to the Applicant.
is important at this stage to reproduce annexure "B" for a
full understanding of the lis between the parties. The letter is
cited in extenso as follows:
TO: IRON ENGINEERING (PTY) LTD FAX NO: 09268 5184671 ATTENTION: MR.
TONY RAMOS OUR REF: 061/PVD
15 FEBRUARY 2001 ISOLITE SWAZILAND
refer to a discussion with our Terry Smith and wish thank you for
your agreement to reduce the rental to Rl6 000 per month until
clarity is obtained with the Fridgemaster liquidation with the
remainder to be paid at the earliest opportunity.
are currently owed a large amount of money and are uncertain as to
whether fridges will continue to be made in Swaziland. We sincerely
hope that a favourable decision is reached with regard to
Fridgemaster that enables us to continue in Swaziland, as we are
unlikely to be able to sustain the business without some fridge
will transfer an amount of Rl6 000 to your account today. Thank you
for your understanding.
S.A. (PTY) LTD
R. VAN DUYN MANAGING DIRECTOR
ISOLITE SWAZILAND - TERRY SMITH".
and through a letter dated the 30th October 2001, Applicant further
received correspondence from Mr. Terry Smith. In that letter the
Applicant was informed that the Respondent was now 100% owned by the
Isolite group of South Africa. The new owners informed the Applicant
that they would like to remain on the leased premises and went
further however by stating that Isolite will not be able to pay any
arrears for rent. According to the Applicant this was a clear
statement that Respondent acknowledged there was arrear rental albeit
that they were unable to pay for such arrears.
Applicant avers that the Respondent was in breach of the lease
agreement, the Respondent is in arrears with its rental for the
period between February 2001, to November 2001, respectively in the
sum of El 19, 229-45.
defence advanced by the Respondent is that the original written lease
terminated on the 31st June 2001, and that a second, tacit lease came
into being thereafter. The terms of the second tacit lease were that
the premises were re-let at the rental which applied when the
original written lease terminated, that the terms which were
incidental to the relationship of landlord and tenant between the
Applicant and the Respondent were renewed but that the collateral
provisions of the original lease were not carried forward into the
tacit lease. The Respondent in support of this proposition cited the
South African case of Doll House Refreshments vs O'Shea & others
1957 (1) S.A. 345 (T.
at 350H- 351.
is contended on behalf of the Applicant that it is common cause that
the written lease between the parties terminated on the 31st June
2001. There was no written notice of renewal. The Respondent alleges
that a second tacit lease came into being on expiration of the
original written lease. The argument advanced on behalf of the
Applicant to counter this allegation is that in law, it is presumed,
in the event of a tacit relocation that the new agreement has been
entered into at the same rent. To support this proposition Mr. Flynn
directed the court's attention to the South African cases of Shell
South Africa vs Bezuidenhout and others 1978 (3) S.A. N.
at 984 B - D and 985A; Doll House Refreshments vs O'Shea and others
1957 (1) S.A. 345 at 348 and also to the writings of Cooper on
Landlord and Tenant (2nd ED) at pages 350 -351. The Applicant
contends that there was a tacit relocation of exhibit "A"
which provides a rental of E26, 342-40 until 31st June 2001 and E29,
503-49 for the period 1st July 2001 to 31st June 2002. The Applicant
claims the difference between the amount of El6, 000-00 and the
rental payable in terms of the lease.
second contention by the Applicant revolves around the dispute of
fact in this matter. The Respondent alleges that Ramos agreed that
the rental could be reduced. The Applicant alleges that it agreed to
a reduction of the rental to El6, 000-00 but on the understanding
that the remainder payable in terms of the lease would be paid at the
condition was handwritten onto annexure by Ramos. Ramos alleges he
requested Smith to send a letter with the words included but this was
never done. The alleged reduction of the rental is dated the 15th
February 2001, which was during the period of the original written
lease. According to the Applicant this alleged variation is not
binding in terms of Clause 1.3 of the lease agreement in force at the
time. It is the Applicant's view that the alleged dispute of fact in
respect of reduction can be resolved on the papers. On the 12th
November 2001, Smith stated that the Respondent would "not be
able to pay any arrears for rent".
to the Applicant this was tantamount to an admission that the
Respondent was liable for the arrears caused by the acceptance of
El6, 000-00 per month. Smith's explanation of his reference to
arrears is that he intended to convey that the proposed new lease
would be an entirely new arrangement. This explanation does not
assist the Respondent in that there remains a clear acknowledgement
of arrears which Isolate does not wish to include in any new
arrangement. There is therefore no dispute with regard to the fact
that there are arrears.
Goddard on behalf of the Respondent argued that this is a case of a
misunderstanding where disputes of fact appear from the papers,
relief should only be granted thereon if the facts as stated by the
Respondent together with the admitted facts in the Applicant's
affidavits justify such an order. On this point the court was
referred to the cases of Stellenbosch Farmers Winery Limited vs
Stellenvale Winery (Pty) Ltd 1954 (4) S.A. 234 C at 235 E - G;
Plascon Evans Paints Limited vs Van Riebeeck Paints (Pty) Ltd 1984
(3) S.A. 623 A at 634 E - I; and Duplessis and another NO. vs Rolfes
Limited 1997 (2) S.A. 354 A at 367A.
is common cause that the original written lease terminated on 31st
June 2001 and that a tacit monthly lease applied thereafter. The
Respondent contends that rental was reduced by agreement between
Ramos and Smith. There is no dispute that the Respondent has paid a
reduced monthly rental of El6, 000-00. Accordingly, on the facts
stated by the Respondent, there are no arrears.
it was contended on behalf of the Respondent that the Respondent
never disputed or failed to recognise the applicant's right to the
security allowed to a landlord by way of a tacit hypothec over
movables. It was accordingly unnecessary for the Applicant to have
brought the proceedings to enforce its rights to security, and in the
circumstances the Applicant should be ordered to pay the costs of the
court's analysis and conclusions thereon.
have considered the facts of this matter in toto and also the very
helpful submissions made by both counsel in this matter. It appears
to me that the crux of the matter which needs to be decided at this
stage of the proceedings is whether or not there are disputes of fact
which cannot be resolved on application proceedings. The alleged
disputes of fact, revolves around the reduction of rent. The
Applicant's case is that the alleged dispute of fact in respect of
reduction can be resolved on the papers. The Applicant supports its
stance on the fact that on the 12th November 2001, Smith stated that
the Respondent would "...not be able to pay any arrears for
rent". This, according to the Applicant was tantamount to an
admission that the Respondent was liable for the arrears caused by
the acceptance of El6, 000-00 per month. Per contra the Respondent
contends that rental was reduced by agreement between Ramos and Smith
in February 2001.
above is the nub of the present dispute. The Applicant has expressly
rejected the suggestion that the matter should be determined by the
hearing of oral evidence. This is confirmed by a letter from the
Respondent's attorney to the Applicant's attorney dated the 26th
November 2002, where a dispute of fact appear from the papers, relief
should be granted thereon if the facts as stated by the Respondent
together with the admitted facts in the Applicant's affidavit justify
such an order. The general rule which governs such situations was
clearly enunciated by Van Wyk J (with whom De Villers JP and Rosenow
J concurred) in Stellenbosch Farmers Winery Ltd (supra) at 235 E
be; and I quote:
there is a dispute as to the facts a final interdict should only be
notice of motion proceedings if the facts as stated by the
Respondents together with the admitted facts
the Applicant's affidavits justify such an order ... where it is
clear that facts, though not formally admitted, cannot be denied,
they must be regarded as admitted".
above-cited statement of the law was cited with approval by the
Appellate Division in the celebrated case of Plascon Evans Paints
(supra) per Corbett J.A.
appears to me that in casu Mr. Goddard for the Respondent is correct
in his submissions that the phrases in annexures "B" and
"D" quoted by the Applicant neither warrant only the
inference which the Applicant asks this court to draw, nor can they
be fairly or properly interpreted without referring the matter to
"B" being a letter dated the 15th February 2001 from Peter
R. Van Duyn who was Managing Director for Isolite Swaziland to Mr.
Tony Ramos is fraught with contentious issues. The hand-written
insertion in the letter as outlined above is a contentious issue.
Annexure "D" being a letter from Terry Smith dated 12th
November 2001, directed to Mr. Ramos cannot be fairly or properly be
interpreted without referring the matter to oral evidence. In this
regard (see also Ramos, reply, paragraph 6 page 50 and Smith
paragraphs 6 and 7 pages 39 and 40 of the Book of Pleadings.
is my considered view, on the facts that the matter ought to proceed
by way of the leading of vova voce evidence.
it would appear to me that the Respondent never disputed or failed to
recognise the Applicant's right to the security allowed to a landlord
by way of a tacit hypothec over movables. It was accordingly
unnecessary for the Applicant to have brought the proceedings to
enforce its right to security, and in the circumstances the Applicant
is ordered to pay the costs of the entire application.
following order is thus recorded:
matter is referred to oral evidence;
Applicant to pay costs of the application including costs of counsel
in terms of Rule 68 of the High Court Rules.