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Wednesday Feb 19, 2014

Verbal agreements don't carry same weight as written contract

Courts deal with many cases involving written leases where parties lay claim to verbal agreements to enforce certain obligations.

A recent case in point is the Kingswood Golf Estate (Pty) Ltd v Witts-Hewinson & another (223/13) (2013) ZASCA 187 (29 November 2013).

The Supreme Court of Appeal (SCA) overturned the judgment that was given in favour of the buyers, Mr and Mrs Witts-Hewinson.

The buyers relied on a newsletter of the architectural design of a golf estate clubhouse the developer-seller (Kingswood Golf Estate (Pty) Ltd) were to build in the future.

The Western Cape High Court ordered the developer to build the clubhouse without further delay as per the design contained in the newsletter.

The developer appealed against the court's judgment, arguing that an interim clubhouse was available and it was not under obligation to build another.

The clause relating to an upmarket, furnished clubhouse was vague and, while the newsletter gave content to the envisaged clubhouse, it was not part of the agreement and its addendum.

The developer also argued that the agreement contained a non-variation clause and a non-representation clause.

The court did not admit the newsletter as evidence to provide clarity to the clause that was vague, since this was information outside and after the conclusion of the agreement.

The court found that the non-variation and non-representation clauses did not allow for changes unless reduced to writing and signed by both parties.

The post-contractual newsletter was not signed by the parties and was therefore not part of the deed of sale.

Finally, the court held that the buyers' reliance on the external evidence (post-contractual newsletter) went against the parol evidence rule that was enunciated in Lourey v Steedman 1914 AD 532 at 543:

'The rule is that when a contract has once been reduced to writing, no evidence may be given of its terms except the document itself, nor may the contents of such document be contradicted, altered, added or varied by oral evidence.'

Tenant Issues
Daily News
Dr Sayed Iqbal Mohamed
Chairman, Organisation of Civic Rights.

    
 

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