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IN THE HIGH COURT OF SOUTH AFRICA (TRANSVAAL PROVINCIAL DIVISION)
Case No: 16947/2001 NOT REPORTABLE DATE: 6/1/2006
CONCOR HOLDINGS (PTY) LTD Plaintiffs Respondents
and
THE MINISTER OF WATER AFFAIRS AND FORESTRY First Defendant
First Excipientand
VKE CONSULTING ENGINEERS (PTY) LTD Second Defendants Second Excipients
JUDGMENT ON EXCEPTION
STEGMANN, J: [1 ] In July 1998 a bridge over the Ngwaritsane River in
Mpumalanga, to be known as the Injaka Dam bridge, was in the course of construction.
On 6th July there was a collapse of certain components of the work in progress. Disagreement has arisen over the responsibility for the collapse and its financial
consequences. Summons has been issued, instituting an action to resolve the question.
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[2] This judgment deals with exceptions that have been raised against the
particulars of claim delivered by the plaintiffs in the action. There are two excipients.
They are respectively the first and second defendants in the action. In addition, the
second defendants have applied in terms of Rule 30 for the setting aside of one or more
of the following paragraphs in the plaintiffs' particulars of claim as irregular steps,
namely, paragraphs 22, 84, 85.1, 85.2, 87, 89, 92 or 92.4 and 93. The second
defendants have also applied for the striking out of paragraphs 86 and 88 on the ground
that they are irrelevant.
[3] The plaintiffs' main claims against the first defendant have been framed in
contract. The first defendant's exceptions are not directed against the contractual
claims. As a claim expressed to be concurrent with the contractual claims against the
first defendant, the plaintiffs have framed a claim against him in delict, and an
alternative thereto, also in delict. The first defendant excepts to the claims in delict on
the basis, first, that they lack averments necessary to support a cause of action; and
second, that the claims in delict are in any event excipiable as being vague and
embarrassing, the plaintiffs having failed to remove the causes of complaint set out by
the first defendant in a notice in terms of Rule 23. The first exception raises, amongst
other questions, the question whether the principles underlying the decision in Lillicrap,
Wassenaar and Partners v Pilkington Brothers (SA) (Pty) Ltd 1985 1 SA 475 (A)
('Lillicrap') confine the plaintiffs to such contractual remedies as they may have against
the first defendant, and preclude the plaintiffs from asserting any claim against the first
defendant in delict, at least to the extent that the subject matter of the claim is dealt with
in the contract.
[4] The plaintiffs do not allege that they have any relevant contract with the second
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defendants. Their only claims against the second defendants are in delict, being a main
claim and an alternative claim. The first and main question raised by the second
defendants' exceptions is, similarly, whether the plaintiffs have made averments that are
sufficient in law to disclose one or more causes of action against the second
defendants, in delict. The second question is whether the particulars of claim are in any
event vague and embarrassing.
[5] The first question raised by the second defendants' exceptions also arises in
terms of the principles underlying Lillicrap. It is whether or not the contractual
relationship between the plaintiffs and the first defendant, and the related contractual
relationship between the first defendant and the second defendants, preclude, as the
'tripartite' contractual relationships did in Lillicrap, any possibility of a remedy in delict
on the part of the plaintiffs against the second defendants, at least in respect of subject
matter that is governed by the contractual arrangements between the three parties.
[6] The plaintiffs take the view that, as was recognized in Lillicrap, our common law
recognizes particular situations in which the same set of facts may give rise to both a
remedy in contract and a remedy in delict, simultaneously, i.e. to a concurrence of
actions.1 According to the plaintiffs, the facts that they have alleged in their particulars
of claim, unlike the facts in Lillicrap, disclose that the plaintiffs have causes of action
against the first defendant in both contract and delict concurrently, and also that they
have causes of action in delict against the second defendants, with whom they have no
privity of contract.
[7] The excipients take the opposing view. The first exception taken by each of the
defendants is that the plaintiffs' particulars of claim, to the extent that they purport to set
1 Or a concursus actionum.
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out claims in delict, do not disclose a cause of action against either the first defendant
or the second defendants. In the alternative, each of the defendants contends that, so
far as the plaintiffs' particulars of claim purport to set out a claim in delict, they are
excipiable as being vague and embarrassing, the plaintiffs having failed to remove the
causes of complaint specified by the defendants in their respective notices in terms of
Rule 23(1).
[8] The second defendants' application in terms of Rule 30 to strike out certain
paragraphs as irregular steps does not raise any essentially different question from
those raised by the exceptions. Mr Loxton, who appeared on behalf of the second
defendants, explained that the second defendants had decided to use this alternative
procedure simultaneously with, and in support of, the exceptions in order to forestall any
possible contention that the second defendants were not entitled to the relief sought
without having given a notice in terms of Rule 30(2)(b). The two procedures have
therefore been introduced simultaneously from abundance of caution.
The parties
[9] In terms of the allegations contained in the particulars of claim, the plaintiffs are
Concor Holdings (Pty) Ltd, a company carrying on business as construction .and
engineering contractors, with their principal place of business in Johannesburg. Mr
Klevansky appeared on their behalf.
[10] The first defendant has been cited as 'The Minister of the Department of Water
Affairs and Forestry' and as representing the government, pursuant to s 2 of the State
Liability Act, 1957 (Act No 20 of 1957). Mr Raath appeared on behalf of the first
defendant.
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[11] The second defendants are VKE Consulting Engineers (Pty) Ltd, a company
carrying on the business of consulting engineers under the style of 'VKE Engineers'.
Their principal place of business is in Pretoria. Mr Loxton appeared on their behalf.
The plaintiffs' particulars of claim
[12] In broad outline, the allegations made in the plaintiffs' particulars of claim are
to the following effect.
The contract between the first and second defendants: 'the consultancy agreement'
[13] On 19th June 1996 and at Pretoria a duly authorized representative of the first
defendant, and the second defendants, duly represented by a Mr M Rautenbach,
concluded a written contract that has been attached to the pleadings.2 The main
provisions of the contract are contained in a standard form, as amended up to January
1994, published and recommended for use by the South African Association of
Consulting Engineers. The standard form proclaims itself to be based on rules published
in terms of the Engineering Profession of South Africa Act, 1990 (Act No 114 of 1990)
as far as they are applicable. This contract is referred to in the particulars of claim as
'the consultancy agreement'.
[14] The consultancy agreement was concluded in respect of an undertaking
referred to as 'the project'. The project was defined as
'the design of an alternative route for Road P57 -2 (which will be inundated
by the Injaka Dam) over or around the Injaka dam basin in accordance with
the requirements of Tender W5304 of the Department of Water Affairs and
2 Particulars of claim, pp 521 to 572.
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Forestry and the Technical Proposal (November 1995) submitted by VKEEngineers'.3
[15] The consultancy agreement made provision for the second defendants to
render services to the first defendant in four stages.
First was the 'Report Stage', during which the second defendants were to
investigate feasible alternative routes for Road P57 -2 (which was to be inundated by the
Injaka dam) over or around the Injaka dam basin, and to prepare and submit a report
thereon.
When the first defendant had considered the report, made decisions on it and
given instructions, the second stage of the second defendants' services was to consist
of the drawing up of a 'Preliminary Design'.
The third stage was to be the 'Design and Tender Stage', .in which the second
defendants were to prepare designs, drawings and tender documents for the
construction of the proposed route for Road P57 -2.
The fourth stage of the second defendants' services was termed the
'Construction Stage' during which their services were to comprise the general
administration and co-ordination of the construction of the relevant part of Road P57-2
over its new route.
[16] By the time that the first three stages of the consultancy agreement had been
completed, it had apparently been decided that the project also involved a road referred
to as Road P57 -3, running between Bushbuck Ridge and Graskop; and that the routing
of Road P57 -3 would involve the construction of a bridge over the Ngwaritsane River in
the Injaka dam basin. It is referred to as the Injaka dam bridge. The second defendants
3 Particulars of claim, p 527.
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had prepared the designs and drawings for the bridge and also the necessary tender
documents.
[17] The position appears more clearly from the sketch plans or maps attached to
the particulars of claim.4 Road P57 -2 runs approximately East and West between
Graskop in the West and Injaka in the East. Along this stretch of road is a T-junction
at which Road P57-3 branches off to the North and leads to Bushbuck Ridge. It seems
that Road P57-3 always crossed the Ngwaritsane River. However, the building of the
Injaka Dam was to result in the flooding of a relatively long stretch of the existing Road
P57-3. By re-routing a section of Road P57-3, the first defendant's officials were able
to arrange for a substantially narrower section of the area that was to be flooded by the
Injaka Dam, to be crossed by a bridge. It was to be known as the Injaka bridge. These maps
also show that the route between Graskop and Bushbuck Ridge is referred to as
route R533. South and West of the T-junction leading to Injaka, route R533 is Road
P57-2, and North and East of that T-junction route R533 is Road P57-3.
The contract between the plaintiffs and the first defendant: 'the building contract'
[18] The plaintiffs, Concor Construction (Pty) Ltd, had submitted a tender under
cover of a letter dated 26th June 1997 relating to Tender WF6299 for 'The road bridge
on the realigned section of Road P57-3 and the Haulage Road and bridge for Mondi
Forests over the Injaka Dam Basin.'5 In terms of a letter dated 30th July 1997, a
4 At pages 260, 295 and 296 of the particulars of claim.
5 This tender related to road construction works that included bridges over the Injaka dam basin at two separate sites. The present proceedings are concerned only with the site of the road
bridge on the realigned section of Road P57-3 over the Injaka dam basin. They have nothing to do with
the Haulage Road and bridge for Mondi Forests over the Injaka dam basin.
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representative of the first defendant had accepted the plaintiffs' tender.6
[19] The first defendant's acceptance of the plaintiffs' tender constituted the
conclusion of a contract that incorporated five volumes of documents, and an additional
provision also incorporating - 'the first defendant's letter of acceptance of the tender, the guarantee and
all addenda issued during the tender period.'
The five volumes were:
1. Volume 1: The General Conditions of Contract for Works of Civil Engineering
Construction, 6th edition (1990) ('the GCC'); 7
2. Volume 2: The CSRA Standard Specifications for Road and Bridge Works,
1987, issued by the Committee of State Road Authorities,
together with the standard amendments of June 1991 ('the CSRA
Specifications'); 8
3. Volume 3: Tender Document relating to Tender WF 6299; 9
4. Volume 4: Project Specification; 10
5. Volume 5: Tender Drawings. 11
[20] This contract is referred to in the particulars of claim as 'the building contract'.
In terms of the building contract, the plaintiffs were to construct the Injaka dam bridge
6 Particulars of claim, p 170.
7 Particulars of claim, p 5, para 5.1; pp 171 - 243; p 297; p 408.
8 Particulars of claim, p 6, para 5.2.1; p 297; p 408; pp 627 - 656; Standard Amendments of June 1991
at pp 422 - 433.
9 Particulars of claim, p 6, para 5.3; pp 244 - 323; p 331 - 406; p 297; p 408.
10 Particulars of claim, p 6, para 5.4; p 297; pp 407 - 514.
11 Particulars of claim, p 6, para 5.5; p 297; p 408; pp 515 - 519.
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('the works').12 The works comprised both 'permanent works',13 being the bridge in its
final form in accordance with the building contract, and 'temporary works',14 being
additional but temporary structures, also in accordance with the building contract,
required for or in connection with the construction of the bridge, and not to be left in
position once the bridge had been completed..
[21] The plaintiffs have alleged that they undertook to perform the works for
R38,183,978.54.15 Payment was to be made in terms of monthly certificates.16
Provision was made for adjustments to the contract price to cater for variation orders.17
There was also provision for increases or decreases in certain of the rates and prices
stated in the plaintiffs' tender in accordance with a standardised Contract Price
Adjustment Schedule ('CPAS').18 It provided a formula for the determination of a
Contract Price Adjustment Factor ('CPAF') from time to time.
[22] A drawing attached to the particulars of claim 19 shows the general
arrangement of the intended permanent works of the Injaka dam bridge. The
Ngwaritsane river, depicted as no more than about 10 metres wide at the intended
bridge, runs from West to East along a valley with gently sloping sides. This part of the
12 General Conditions of Contract, clause 1(1)(z) {'GCC 1(1)(z}'). particulars of claim, p 180.
13 GCC 1(1)(p), p 179.
14 GCC 1(1)(w), p 179. 15 Particulars of claim, p 8, par 9.
16 GCC 52, at pp 207 to 209.
17 GCC 39 and 40, at pp 198 to 199. 18 GCC 49(2) and (3), at p 204; and the CPAS at p 221 to 222.
19 At p 601. See also pages 515 to 519 for the more detailed tender drawings showing both the design for the permanent works, and some particulars relating to the incremental launching
method, involving certain temporary works.
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valley was to be flooded by the waters of the dam to a depth below the height at which
the bridge was to be built. The bridge was to cross the waters of the dam in a generally
Northerly and Southerly direction in a substantially horizontal plane. The underside, or
soffit, of the bridge was to be some 38 metres above the river. That height was chosen
with regard to the height of the dam wall and the depth of the intended flooding of the
valley. The bridge was to be 300 metres long, between an abutment on the Southern
bank ('abutment 1 ') that brought Road 57-3 from Graskop to the bridge, and an
abutment on the Northern bank ('abutment 8') that took the road from the bridge in the
direction of Bushbuck Ridge. 20
[23] The bridge was designed so that the deck (carrying the road) would have a
slight gradient.21 It was also to have a gentle curve 22 to accommodate the arrival of
Road 57-3 from Graskop, on abutment 1 on the Southern bank, in a direction running
a few degrees East of North, and its departure from abutment 8 on the Northern bank
towards Bushbuck Ridge in a direction running a few degrees West of North. For
Northbound traffic, the curve of the bridge was therefore to be a gentle left-hand bend,
and an equivalent right-hand bend for Southbound traffic. The road surface on the
deck of the bridge was to be tilted a few degrees from the horizontal towards the inside
edge of the bend, that is, towards the West. Between abutment 1 on the Southern bank
and abutment 8 on the Northern bank, the bridge was to be supported by 6 piers,
respectively numbered, from South to North, pier 2 to pier 7, and to be located at
intervals or spans of 45 metres from each other. There were to be five such spans of
20 Project specification: Particulars of claim, pages 410 to 413.
21 'A constant vertical grade of 0.5%': Particulars of claim, p 413.
22 'Constant horizontal radius of 600m': Particulars of claim, p 413.
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45 metres each. The span between abutment 1 and pier 2 was to be 37,5 metres, and
that between pier 7 and abutment 8 also 37,5 metres. These seven spans were
therefore to make up the total of the intended 300 metre length of the bridge deck.
[24] The upper slab of the deck of the bridge, carrying the roadway, was to be some
14,25 metres wide. This was substantially wider than the tops of the piers that were to
support the deck. The piers were each to be 7,4 metres wide at the top. To
accommodate this arrangement, the deck segments of the bridge were to be
constructed with a relatively narrow lower horizontal slab of reinforced concrete (some
6,049 metres wide) that was to rest on bearings mounted on the tops of the piers. This
lower slab, or at least its bottom surface, has been referred to as the 'soffit' of the deck.
The lower slab was to have upturned and nearly vertical outer walls, rising some 3
metres above it. These outer walls have been referred to as the 'web' of the deck. There was to be one web along the length of the Western side of the deck and another
along the length of the Eastern side. These two webs were in turn to support a relatively
broad upper slab (14,25 metres wide), the upper surface of which was to constitute the
roadway. The roadway was therefore to lie on the top of a deck consisting of a long,
slightly curved, hollow tube of reinforced concrete, substantially rectangular (or
trapezoid) in cross-section, some 3 metres in height and 6 metres wide, that was to be
defined in two nearly horizontal planes by the lower slab and the upper slab, and in two
nearly vertical planes by the Western and the Eastern webs respectively. Along its
entire length, the roadway was to project some 4 metres beyond the Eastern and
Western sides of this hollow tube. The arrangement is summed up in the project
specification thus: 23
23 Particulars of claim, p 413.
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'The bridge deck is a post-tensioned box girder that is supported on the
substructure via proprietary bearings.'
[25] The method of construction of the bridge, which formed part of the design
prepared by the second defendants, was to be what is referred to as the 'Incremental
Launching Method'.24 In broad outline, the incremental launching method involved the
following steps.
[26] First, abutments 1 and 8, and piers 2 to 6 between the abutments, were to be
erected. There would then be seven spans to be bridged, one at either end of 37,5
metres each, and five in between, of 45 metres each, all of them together making up the
300 metre length of the bridge deck.
[27] Next, the 300 metres of the deck were to be constructed in twenty separate
segments of reinforced concrete, to be cast in succession in formwork located at a
casting yard to be established on the Southern bank, immediately to the South of
abutment 1. Each segment was to be 15 metres in length. Provision was made for
each segment to be cast in two stages.25 In this way a construction joint was permitted
between the upper ends of the near-vertical webs and the deck slab that was to rest on
them, but there was to be no construction joint between the lower ends of the webs and
the bottom slab. The webs and the bottom slab were to be cast as an integral unit and
the deck slab, which was to carry the roadway on top was to be joined to the webs within
three days. The centre of each 15-metre segment was strengthened with a vertical
24 Project Specification, Sec B9100: Incremental Launching Method. Particulars of claim, 495 - 500.
25 Particulars of claim, p 500; Project specification, clause B9106 (c): 'Construction of bridge deck
The box section may be cast in two stages with a construction joint located between the
webs and the deck slab. The time lapse between the placing of the concrete in the two
stages shall not exceed 3 days.'
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diaphragm. Each segment of the deck was to be a complex hollow unit of reinforced
concrete with a number of surfaces including those of the lower slab, the Eastern and
Western webs, the upper slab carrying the roadway, and the internal diaphragm.
[28] The 15-metre deck segments were to be cast in succession in formwork in the
casting yard on the Southern bank. The formwork was to be so constructed, and so
located in relation to abutment 1, that when segment 1 of the deck had been cast, a 30-
metre long 'launching nose' of steel girders, strengthened by cross-bracing, could be
attached to the Northern end of the segment; the segment could be jacked up to release
it from the formwork; and the assembly comprising the launching nose and segment 1
could be slid out Northwards over temporary bearings on abutment 1 so that the
launching nose would begin to reach out across the span of 37,5 metres between
abutment 1 and Pier 2.26
[29] Then segment 2 of the deck was to be cast in the same formwork in the casting
yard. When this had been done, segment 2 was similarly to be slid out Northwards from
the formwork. Its Northern end was to be attached to the Southern end of segment 1.
The entire assembly of launching nose, segment 1 and segment 2 was then to be slid
further Northwards over the temporary bearings and over the span between abutment
1 and pier 2. At some appropriate stage, the front of the launching nose would reach
the temporary bearings on top of pier 2. Pier 2 would then begin to carry some of the
weight of the assembled launching nose and segments of the deck. Segment 3 would
follow segment 2 in the same way. The remaining deck segments would follow in
succession until the launching nose and the Northern end of segment 1 had reached
26 The layout of the initial launching stages is illustrated in a diagram that contains an outline of the
launching nose: particulars of claim, p 519.
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their destination on abutment 8 on the Northern bank, and segments 2 to 20 had
completed the deck all the way back to abutment 1 on the Southern bank.
[30] At that stage, the launching nose (a part of the temporary works) was to be
discarded. The entire deck was to be lowered a short distance down from the
temporary bearings on the abutments and piers over which it had been slid into place,
onto the permanent bearings on the same abutments and piers. The temporary
bearings were to be removed and the deck was to be permanently fixed into position on
the permanent bearings.
The plaintiffs' contention relating to the method of construction
[31] On behalf of the plaintiffs, Mr Klevansky submitted that, as a general rule,
construction contracts provide for a clear line of demarcation between the area of
responsibility of the consulting engineer, and the area of responsibility of the building
contractor. The consulting engineer, he contended, is generally responsible for design
and supervision. The contractor is responsible for construction including, importantly,
the selection and implementation of the method of doing the building work. However,
the building contract in the present matter was different. It did not leave the plaintiffs,
as the building contractors, free to choose their own method of construction. The
contract obliged the plaintiffs to use the incremental launching method that had itself
been designed by the second defendants as the consulting engineers.
[32] The fact that the plaintiffs were not left free to choose their own method of
construction, and had contracted in terms of the building contract to use the incremental
launching method designed by the second defendants, constituted the basis for certain
of Mr Klevansky's further contentions on behalf of the plaintiffs. The plaintiffs' case is
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to the effect that when they had prepared drawings for the temporary works needed to
implement the second defendants' incremental launching method, and when they had
submitted their drawings to the second defendants for approval (as they were obliged
to do in terms of the building contract 27), there was a consequence that followed as a
matter of law, irrespective of the fact that there was no contract between the plaintiffs
and the second defendants. Mr Klevansky submitted, as I understood him, that the
legal consequence was that the second defendants came to owe a legal duty to the
plaintiffs to check that the designed strength of the deck segments (as part of the
permanent works for the design of which the second defendants were responsible) was
such that each segment could withstand the forces to which it would be subjected when
being conveyed over temporary bearings, located as designed by the plaintiffs in the
course of implementing the second defendants' incremental launching method.
[33] In support of their respective exceptions, counsel for both the first and the
second defendants relied on the following provision in the building contract:
'2.2.4 Bridge work 'The bridge is a 7-span continuous structure with an overall length of 300 m and is designed to be constructed by means of the incremental
launching method. ... The contractor shall accept full responsibility for the
design of all temporary work required for the construction of the bridge, and
shall submit full details thereof to the engineer for his review and acceptance.' 28
[34] The defendants contend that the plaintiffs' particulars of claim indicate that it
was the design of the temporary works (including in particular the launching nose and
27 Particulars of claim, p 41, para 16; GCC 16(11), at p 189; Project specification, para 2.2.4, at p 413
and B91O4(a) at p 497.
28 Building contract, Vol 4: Project Specification, in the particulars of claim at p 413.
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the temporary bearings) that resulted in the failure of the bridge; that clause 2.2.4
('Bridge Work', quoted above), supported by other provisions to be mentioned later,
establishes that the plaintiffs, by their contract with the first defendant, accepted 'full
responsibility' for the design of the temporary work; and that the building contract
therefore precluded the plaintiffs from setting up a claim in delict against either the first
defendant or the second defendants.
The failure of the bridge during construction. on 6th July 1998
[35] The plaintiffs' pleaded version of how the bridge failed on 6th July 1998, during
the course of construction, is recorded in a letter dated 21st August 1998 29 addressed
by Messrs Lawrence & Boorsma, Consulting and Civil Engineers, to Messrs Deneys
Reitz, the attorneys for the second defendants, with copies to two other firms of
attorneys, Messrs Webber Wentzel Bowens and Messrs Werksmans, together with four
diagrams attached to that letter.30 Mr P A W Boorsma recorded that a meeting had
been held between himself, Mr C Meinljes of Messrs Jeffares & Green and Mr E de
Fleuriot of Messrs Stewart Scott Inc. It had been agreed between them as follows:
'1. SEQUENCE OF FAILURE
2.
See attached diagrams - Figures 1 - 4 for sequence of failure.
CAUSE OF FAILURE
The initial cause of failure was as a result of the inadequacy of the bottom
slab and web to resist the forces resulting from the temporary bearing
during launching.'
These propositions were confirmed by the signatures of the other two engineers, Mr C
J Meintjes and Mr E de Fleuriot.
29 Particulars of claim, p 600.
30 Particulars of claim, pp 601 to 604.
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[36] The plaintiffs have alleged that the failure occurred during the launching of
segment 6. The diagrams show that at that stage, the launching nose had reached pier
3 and that its leading end already protruded a few metres to the North of that pier, while
the remainder of the nose was sliding over the temporary bearings on pier 3. The
temporary joint between the launching nose and segment 1 was about half-way across
the span between pier 2 and pier 3. Segment 1 had successfully passed over the
temporary bearings on abutment 1 and those on pier 2. The entire length of segment
1 was suspended over the span between pier 2 and pier 3, supported at its Northern
end by its temporary joint with the launching nose resting on pier 3, and at its Southern
end by its connection with segment 2 which was then passing over the temporary
bearings on pier 2. Segment 3 was evidently suspended between abutment 1 and pier
2, supported at its Northern end by its connection with segment 2 and at its Southern
end by its connection with segment 4. Segment 4 appears to have been passing over
the temporary bearings at the Northern end of abutment 1 and also to have been
receiving support from its connections with segment 3 to the North and segment 5 to the
South. Segment 5 seems to have been passing over temporary bearings on a support
immediately to the North of the casting yard, apparently at the Southern end of
abutment 1. Segment 6 had evidently been released from the formwork in the casting
yard and attached to segment 5, and it was being pushed Northwards, as part of the
chain of segments.
[37] The vertical centre lines of the temporary bearings were not located directly
underneath the bottoms of the Eastern and Western webs of the deck segments as
each of the segments in turn travelled over these bearings. The bearings were
somewhat closer to the centre of each pier. They therefore gave their support to the
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soffit of the deck at points somewhat inward of the webs and may be said to have been
medially offset from the webs. As already mentioned, the deck was not quite horizontal:
it was tilted a few degrees to the West.
[38] The first failure occurred where the soffit of segment 2 was passing over the
temporary bearings on pier 2. Horizontal and vertical tensile cracks developed on the
outer surfaces at the conjunction of the web and the lower slab on the Western side of
deck segment 2, and spread inwards into the concrete. When such a vertical crack had
spread right through the concrete of segment 2, in the area where the Western web met
the lower slab, the Western web sheared off the lower slab at this point and came to
rest on top of pier 2, immediately to the West of the temporary bearing on that side of
pier 2. The lower slab of segment 2 remained supported above the upper surface of
pier 2 by the temporary bearing on pier 2. In their particulars of claim, the plaintiffs have
described this process as 'the temporary bearings punching through the soffit at Pier 2
during construction'. 31
[39] This was followed by the development of similar cracks at the conjunction of the
Eastern web and the lower slab of deck segment 2, and by the Eastern web's shearing
off the lower slab of the deck segment and sinking down onto the top of pier 2 in a
similar manner whilst the lower slab of the deck segment remained supported by the
temporary bearing on that side of the pier.
[40] The settling in this way on pier 2 of the Western and Eastern webs carrying the
upper slab of deck segment 2 caused, or accompanied, the failure of the launching nose
which, with its leading end supported by the temporary bearings on pier 3, buckled at
31 Particulars of claim, p 51, para 35.3.1; p 59, para 49.1; and p 66, para 66.3 which repeats, inter alia,
para 49.1.
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a point a few metres to the South of pier 3. At the same time, the assembled segments
of the deck evidently began to break in three places: over pier 2; in the middle of the
span between abutment 1 and pier 2; and over abutment 1. The launching nose fell to
the ground, pulling the attached segment 1 forward. The connection between the
launching nose and segment 1 broke. The front end of the launching nose damaged
pier 3. The broken sections of the deck also fell to the ground both North and South of
pier 2. Pier 2 itself was broken by the forces involved in this failure. A broken section
of the deck immediately to the North of abutment 1 also fell to the ground.
[41] The plaintiffs' allegations relating to the manner in which the failure occurred
clearly carry the suggestion that there was a design fault in the respect that the
temporary bearings on pier 2 were not located directly underneath the webs of the deck
segments. Nevertheless, it is also the plaintiffs' case that that particular design fault
was not necessarily the true cause, or the sole cause, of the failure. They have alleged
specifically that even if the temporary bearings had been located directly underneath the
webs of the deck segments, the failure would in any event have occurred.
The plaintiffs' case in delict and the defendants' exceptions, broadIy stated
[42] Before coming to the details, it is convenient to take a broad view of the
plaintiffs' case in delict and the general nature of the grounds of the defendants'
exceptions. The plaintiffs allege that the two defendants are jointly and severally liable
to the plaintiffs in delict for damages in the sum of R36,035,936.22 (excluding VAT,
which is also claimed, at the rate of 14%) if, or to the extent that, this amount may not
be recoverable from the first defendant in contract. The second defendants are alleged
to have been the wrongdoers, and the claims in delict against the first defendant are
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based upon the alleged vicarious liability of the first defendant for the wrongdoing of the
second defendants.
[43] The amount claimed, R36,035,936.22 (excluding VAT), has been reached as
follows:
1. 'Repair and making good': R6,830,678.73 (excluding VAT) is claimed as
damages suffered by way of the 'cost' to the plaintiffs (in a broad sense that
includes the loss of profit) in respect of the work and materials necessary to
demolish and remove the broken pier 2 and the broken assembly of the
launching nose and segments 1 to 6, and the further cost of replacing these
damaged parts in accordance with a 'new' (or at least amended) design by the
second defendants, constituting a variation from the design on which the
plaintiffs had based their tender and which had initially been contemplated by
the contract. It is the plaintiffs' case that the varied design was essentially to
strengthen the deck segments, particularly at the conjunction of the webs and
the lower slabs, so that the partially constructed bridge could be brought back to
the condition it was in before the collapse on 6th July 1998 during the launching of deck segment 6 (but without the inherent weaknesses that had
caused the collapse), and so that the construction of the remainder of the
bridge could continue, to a successful completion. It is convenient to refer to
this part of the claim as damages for the work of 'repair and making good'. It
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constitutes about 16% of the total claim. 32
2. Time-extension and cost escalation: 33 The plaintiffs claim R7,983,669.00 (plus
VAT) as damages that flow from allegations to the effect that, as a result of the
collapse of the bridge through the second defendants' wrongful conduct, for
which the first defendant is alleged to have been vicariously liable, the plaintiffs
had to spend more time on the job than would otherwise have been the case;
with the result that a time-related escalation of the plaintiffs' costs ensued. It
is convenient to refer to this part of the claim as 'time-extension and cost
32 The plaintiffs have particularized this part of their claim in delict further, as follows (omitting the 14%
VAT claim, and supplying a sub-total):
1. Demolition and removal of collapsed portion of bridge and R 2,795,694.38
temporary works
2. Reconstruct temporary and permanent work up to Segment 6 2,924,349.97
3. Launching nose and design costs 1.110.634.38
R 6.830.678.73
See Particulars of claim, para's 67,70, 89, 93 and Schedule "X4" (p 127)
33 See Particulars of claim, para's 67, 70, 89, 93 and Schedule "X4" (p 127), Item 4.
-22-
escalation damages'. It represents about 26% of the total damages claim.
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3. Further consequential damages: The plaintiffs claim R21 ,221 ,588.49 (plus
VAT) as damages flowing from certain other consequences of the second
defendants' alleged wrongful conduct. This sum represents about 58% of the
total claim.34
[44] The plaintiffs' case proceeds on the basis that it is common cause that they, the
plaintiffs, did the work of repair and making good up to the stage of launching a new
deck segment 6, without remuneration (because of the dispute over responsibility for the
causes of the collapse); and that they then went on to complete the launching of
segment 6 and all further construction work on the bridge in accordance with the
building contract as altered by the second defendants' variations in the design. The
plaintiffs accept that they were paid, in part, in accordance with the building contract for
such further work and materials as they provided after having repaired and made good
the partially constructed bridge, at their own expense, to the stage that it had reached
before the collapse on 6th July 1998. Their case is that they were never paid anything
for the work and materials for repairing and making good the bridge to the point it had
34 The plaintiffs have particularized this part of the claim as follows (omitting VAT and supplying a subtotal):
5. Legal and expert fees, various consultants R 15,153,347.65
6. Costs incurred at time of collapse. (This includes a number of
items, such as medical costs, funeral costs and death benefits;
travel and accommodation, etc - pp 156 - 163.) 477,476.98
7. Cost of financing bridge collapse (The plaintiffs have calculated
'interest on negative cash', pp 164 -167. This would no doubt
include interest on a bank overdraft) 5.590.763.86
R 21.221.588.49
See Particulars of claim, para's 67, 70, 89, 93 and Schedule "X4" (pp 127 and 143 - 167).
-24-
reached at the time of the collapse on 6th July 1998 (the launching of segment 6), and
that they did not receive in full the payments to which they were entitled, as a matter of
contract, for the subsequent work required to bring the bridge to completion.
[45] 16% of the plaintiffs' claim is for the cost of having to repair and make good in
order to restore the bridge to the stage that it had reached before the collapse on 6th
July 1998 (without the faults it had had on that date). The defendants have taken the
view that this is a purely contractual claim, and that the plaintiffs have failed to make
allegations to justify the alternative claim for the same amount as damages recoverable
in delict from the second defendants, and still less from the first defendant on the basis
of his alleged vicarious liability for the delicts of the second defendants.
[46] As for the plaintiffs' claim for damages arising from time-extension and cost
escalation , constituting some 26% of the total damages claimed, the plaintiffs allege that
they were and are entitled (in terms of the contract) to an extension of time for the
completion of the bridge. They allege further that they are entitled, in terms of the
building contract, to the unpaid balance of additional remuneration related to the
extension claimed. In this regard, they claim R7,444,692.71 as the preliminary and
general costs to which they are entitled in respect of the time-extension; and
R538.976.29 as the unpaid balance owing in respect of the applicable Contract Price
Adjustment Factors (' the CPAF's'). The latter part of the claim is calculated at rates
based on 100% of the relevant CPAF's, relating both to the period in which the plaintiffs
were repairing and making good up to the stage of the second launching segment 6,
and also to the subsequent period during which they were completing the building
contract as varied. It is the plaintiffs' case that during the latter period, the payment
certificates issued by the second defendants restricted the cost escalation to 50% of the
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CPAF's whereas 100% ought to have been allowed.
[47] So far as the plaintiffs may not succeed in recovering these claims from the first
defendant in contract, they allege that they are also entitled to recover them from the
second defendants in delict, and from the first defendant on the basis of his alleged
vicarious liability for the delicts of the second defendants. These delictual claims are
said to be for damages for the 'loss' that the plaintiffs will have sustained if they are not
granted the extension of time to which they claim to be entitled in terms of the building
contract, the associated increase in their 'preliminary and general' costs, and the unpaid
50% of the escalation based upon the CPAF's applicable during the period after repair
and making good, when the second defendants again issued monthly payment
certificates for the completion of the building contract, in which the CPAF's were wrongly
calculated.
[48] The defendants contend, inter alia, that these claims are solely contractual
claims, and that there is no room for concurrent or alternative claims in delict.
[49] The major part of the plaintiffs' claims in delict (58%), is for the alleged further
consequential damages. Again, these amounts have been claimed as owing to them
by the first defendant in terms of the building contract and, so far as they may not be
recoverable from him in contract, to be owing by the second defendants in delict and by
the first defendant on the basis of his alleged vicarious liability for the delicts of the
second defendants.
[50] One formulation of the plaintiffs' case rests on the proposition that the second
defendants' faulty design of the deck (and in particular the inadequate strength of the
area where the lower slab meets the web of each deck segment, which I shall call 'the
web-soffit conjunction') rendered the bridge 'unbuildable' by the incremental launching
-26-
method. This has led to differences between the parties as to the interpretation of the
building contract and the interpretation of the plaintiffs' particulars of claim.
[51] The defendants rely on the propositions that in terms of the building contract
the plaintiffs undertook responsibility for the design and implementation of all temporary
works; that the plaintiffs' case as pleaded indicates that the collapse of the bridge
resulted from shortcomings in the temporary works; that the claim as pleaded also
indicates that in terms of the building contract the plaintiffs had agreed with the first
defendant upon contractual provisions that covered the contingencies that, as events
turned out, had resulted in the collapse; and that as the matter had been fully dealt with
in the building contract, the plaintiffs had failed to make averments sufficient to establish
a cause of action in delict against the second defendants.
[52] One aspect of the defendants' submissions is that the contractual provisions
are themselves sufficient to exclude liability in delict on the part of the first defendant or
the second defendants. As I understand the argument, both defendants rely on the
proposition that the effect of the relevant provisions of the building contract is the same
as if the contract had contained an express exclusion of any liability in delict for
negligence on the part of the first defendant or on the part of any agent of first
defendant including in particular the second defendants.
[53] Another aspect of the defendants' submissions is that the contractual
arrangements between the plaintiffs, the first defendant and the second defendants
were such that, in accordance with the principles discussed in Lillicrap, 35 there is no
room for the operation of the law of delict in the manner suggested in the plaintiffs'
particulars of claim.
35 Lillicrap, Wassenaar and Partners v Pilkington Brothers (SA) (Pty) Ltd 1985 1 SA 475 (A).
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[54] The first defendant has made the further point that, even if the plaintiffs have
made allegations sufficient to establish a case in delict against the second defendants
(which the first defendant does not admit), the second defendants are independent
contractors for whose delicts the first defendant is in any event not vicariously liable.
The plaintiffs, on the other hand, contend that they have indeed made allegations which,
if proved, will establish that the first defendant is vicariously liable for the delicts alleged
against the second defendants.
[55] The second defendants also contend that the plaintiffs have failed to set out a
case in delict because their allegations, if proved, will in any event fail, as a matter of
law, to establish that the plaintiffs have suffered any damages recoverable in delict.
This contention involves the submission that the plaintiffs have set out a valid claim
against the first defendant for specific performance of the building contract, and that
there is no room, in law, to recover sums that are recoverable by this contractual remedy
as if they also represented damages recoverable in delict either from the second
defendants or, vicariously, from the first defendant.
[56] The plaintiffs contend, on the other hand, that their delictual claims are for
damages, and that there is good authority for the proposition that in certain
circumstances (which they claim to have alleged) a plaintiff may validly pursue claims
in contract and in delict concurrently, and for damages that may be the same whether
the remedy that is granted is for the contractual claim or the delictual claim.
[57] One of the disputes between the parties relates to the question whether the
plaintiffs' delictual claims, as pleaded, are claims for 'pure economic loss'. If, as the
defendants contend, the plaintiffs' claims are indeed for pure economic loss, the
defendants' exceptions turn on the question of law whether or not the claims and
-28-
exceptions are governed by the decision in Lillicrap.36 In particular, the question raised
is whether the plaintiffs have made allegations sufficient to support the conclusion that
the defendants owed the plaintiffs any relevant legal duty contemplated by the law of
delict.
[58] If the plaintiffs' delictual claims are not for pure economic loss, the two
defendants rely on the already-mentioned exception to the effect that the plaintiffs'
pleadings do not disclose any loss recoverable in delict, the plaintiffs' only remedy being
that which they are in any event pursuing, namely to have the benefit of their bargain
by way of specific performance of their building contract with the first defendant.
Paragraph 49 of the plaintiffs' particulars of claim
[59] Paragraph 49, in Claim ll(1), is common to certain of the plaintiffs' other claims
against the first defendant in contract and also to their claims against both defendants
in delict. Some of the wording of paragraph 49 was the subject of considerable debate
by counsel. It poses difficulties that it is convenient to resolve at once, so as to clear
them out of the way and avoid their complicating the consideration of the remaining
matters that must be decided.
[60] Paragraph 49 reads:
'49. The collapse of the Injaka bridge was caused by or arose directly or indirectly as
a result of or as a consequence of the design, specification or instruction of the
second defendant ("the excepted risk"), and more particularly by virtue of:
49.1 the web and soffit of the Injaka bridge deck being grossly under-
designed by the second defendant for local effects, resulting in the
temporary bearings punching through the soffit at Pier 2 during
construction; and/or
36 1985 (1) SA 475 (A).
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49.2 the web and soffit, in any event being susceptible to failure during
construction, irrespective of the positioning of the temporary bearings,
having regard to the design constraints brought to bear by the second
defendant and the codes of practice for the design of bridges in South
Africa; and/or
49.3 the Injaka bridge being unbuildable, in that
49.3.1 the temporary bearings were placed eccentrically under the webs of
the bottom deck slab as proposed by the plaintiff in accordance
with indications given in contractual documents and drawings
prepared by the second defendant, which placement was
approved by the second defendant as being compatible with its
design, but which nonetheless resulted in the web and the soffit
failing as set out in paragraph 49.1 above; and/or
49.3.2 had the temporary bearings been placed as centrically as possible
under the webs of the bottom deck slab of the Injaka bridge, the
web and the soffit would have failed as set out in paragraph 49.2
above.' 37
[61] The criticisms of counsel for the defendants focussed largely upon
subparagraph 49.2. It was said to be impenetrably obscure and to render so much of
the plaintiffs' claims as depend upon it, and its repetitions, to be vague and
embarrassing and therefore excipiable.
[62] The allegations made in paragraph 49, and in particular in subparagraph 49.2,
are relied upon by the plaintiffs repeatedly. These allegations are obviously of crucial
importance to an understanding of six of the plaintiffs' claims and their alternatives.
They feature in
1. Claim I, p 51, para 35.3.2;
2. Claim I, p 52, para 35.4.2;
3. Claim II(1), p 59, para 49.2;
37 Particulars of claim, pp 59 to 60.
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4. Claim II(1), p 60, para 49.3.2;
5. Claim III, p 66, para 66.3;
6. Alternative Claim III ('Claim III(2)'), p 67, para 68.2;
7. Claim III(2), p 68, para 69.4.1; 8. Claim III(2), p 69, para 71.3;
9. Claim V, p 77, para 88;
10. Alternative Claim V ('Claim V(2)'), p 79, para 91.2;
11. Claim V(2), p 80, para 92.4.1.
[63] When construing a plaintiff's particulars of claim for the purposes of an
exception, it is well-established that a court must not examine the plaintiff's choice of
words with undue stringency. All reasonably possible meanings must be taken into
account, and if on any such construction a cause of action is fairly disclosed, an
exception cannot succeed.38 In the present matter, therefore, if the plaintiffs' words can
reasonably be understood to convey a particular, intelligible meaning, they must be
given that meaning. The procedure of excepting does not provide an occasion for mere
word-play or semantic dispute. An exception can only succeed if it is clear that a
question of substance is involved.
[64] Applying that test, I am of the view that paragraph 49.2 cannot be construed in
isolation and must be interpreted in the light of the full context of the particulars of claim,
including the relevant contractual claims and such of the annexes as are also relevant.
I therefore proceed to consider the contexts in which paragraph 49.2 has been used and
repeated in order to determine the extent to which those contexts may help in
38 See, for example, Franschhoekse Wynkelder (Ko-operatief) Bpk v South African Railways and
Harbours 1981 (3) SA 36 (C), at 38A -C; and Coronation Brick (Ply) Ltd v Strachan Construction Co (Pty) Ltd 1982(4) SA 371(D), at 378C - D.
-31-
understanding the meaning of paragraph 49.2.
The light thrown on paragraph 49 by Claim I
[65] So far as relevant to the present question, the context of Claim I 39 is that it is
a claim in contract against the first defendant alone. It is based on the terms of Clause
45(2), (3) and (4) of the General Conditions of Contract of the building contract ('GCC
45'). The claim is, first, for an extension of the time fixed by the contract for the
completion of the works; and second, for the payment of the preliminary and general
costs associated with the extended time claimed for completion. This relief is claimed
on the strength of allegations that plainly rely on GCC 45(3) 40 entitling the plaintiffs to
an extension of time in specified circumstances that include:
(a) 'the amount and nature of additional work'; 41
and
(c) 'any failure or delay on the part of the Employer or his agents, employees or
other contractors (not being employed by the Contractor) in the due
performance of any obligations as are reasonably necessary to enable the
Works to proceed.' 42
[66] The question under consideration at this stage is whether paragraph 35.3.2 of
Claim I, being in identical terms to paragraph 49.2, but in the context of a different
39 Particulars of claim, pp 44 to 53, paras 24 to 37.
40 p 202.
41 p 50, para 35.1 of the particulars of claim, which specifies 'additional work required as a
consequence of the collapse of the Injaka bridge'.
42 Para 35.2 of the particulars of claim, which quotes the substance of GCC 45(3)(c) without alleging
particulars of any failure or delay, read with para 35.3 and 35.4, which do indeed allege the particular
failure relied upon, and a concomitant delay said to have resulted from it.
-32-
claim, throws light on the meaning of paragraph 49.2 in Claim II(1).
[67] In Claim 1, paragraph 35 is used to make the allegation that the plaintiffs are
entitled, in terms of GCC45(3), to an extension of time for the completion of the building
contract, and to specify four propositions on which, 'inter alia', that allegation is based.
[68] In this context, the phrase 'inter alia' is vague. It adds nothing to the specific
allegations in the particulars of claim. It may perhaps serve as notice to the reader that
elsewhere in the particulars of claim there are further allegations that constitute part of
the justification for the plaintiffs' reliance on GCC 45(3) for an extension of time. But
(unless the trial judge should order otherwise) the plaintiffs cannot rely upon the phrase
'inter alia' for the introduction in evidence of facts that are not more specifically
foreshadowed in the particulars of claim as facta probanda, nor can the plaintiffs rely on
'inter alia' to provide justification for avoiding the present exceptions if they have
otherwise been soundly taken. For the plaintiffs to do so would be to take the
defendants by surprise, or to ambush them.
[69] The first of the four propositions in paragraph 35 is
'35.1 the amount and nature of the additional work required as a
consequence of the collapse of the Injaka bridge'.
This proposition is based on GCC 45(3)(a) at p 202 and is little more than a repetition
of that provision. Of itself, paragraph 35.1 is insufficient to entitle the plaintiffs to an extension of time on the basis of GCC 45(3)(a). One has to look elsewhere in the
particulars of claim for allegations of facts relating to 'additional work required' that is
alleged to have flowed from the collapse of the bridge and to constitute grounds for
invoking that contractual provision. These are necessary facta probanda to establish
a cause of action based on GCC 45(3)(a). They have not been alleged in any of the
-33-
paragraphs under the heading 'Claim I'. 43
[70] The second proposition in paragraph 35 is
'35.2 the failure or delay on the part of the first defendant or the second
defendant in the due performance of the first defendant's obligations in
terms of the building contract to take such steps as were reasonably
necessary to enable the works to proceed with due expedition.'
This proposition is little more than a repetition of GCC 45(3)(c) on p 202. Of itself,
paragraph 35.2 does not set out a ground for an extension of time. One has to look
elsewhere in the particulars of claim for allegations of facta probanda which, if proved,
will establish that the first defendant, or his agents the second defendants, failed to take,
or delayed in taking, steps necessary to enable the works to proceed with due
expedition.
[71] The third of the four propositions is contained in paragraph 35.3. It is to the
effect that the second defendants, acting as the first defendant's agents, required the
plaintiffs to build the Injaka bridge according to a design that rendered it 'unbuildable'
in each of two respects. The plaintiffs evidently rely on each of two alleged design faults
that they lay at the door of the second defendants. If either of the design faults has
been properly alleged, it could rank as a factum probandum justifying the second ground
alleged in paragraph 35.2, that the second defendants, as the first defendant's agents,
failed to take, or delayed in taking, steps necessary to enable the works to proceed with
due expedition.
[72] The first alleged design fault is set out in paragraph 35.3.1, thus:
'35.3.1 the web and the soffit of the ... bridge deck ... [had been] ... grossly
43 However, in paragraph 23, which applies to all claims, the plaintiffs have alleged that the second
defendants designed a 'replacement bridge' and instructed the plaintiffs to build it. Presumably this is
'additional work' contemplated by the allegation in paragraph 35.1.
-34-
underdesigned by the second defendant for local effects, resulting in the
temporary bearings punching through the soffit at Pier 2 during construction. '
This is vague language that does little to inform the defendants of the case that they will
have to meet. In essence, the plaintiffs have here alleged no more than that the second
defendants should have designed the web and the soffit in such a way that, during
construction, the temporary bearings would not 'punch through' the soffit.
[73] The suggestion that the temporary bearings 'punched through' the soffit is
scarcely reconcilable with what the plaintiffs have themselves adopted, in annexes to
their particulars of claim, as the manifestations of 'the inadequacy of the bridge deck
design' 44 and as 'the agreed sequence and cause of failure'.45 In these annexes, the
plaintiffs accepted that while deck segment 2 had been passing over the temporary
bearings on pier 2, with the vertical centre lines of the bearings offset from the centre
lines of the bottoms of the webs, tensile cracks, both vertical and horizontal, had started
to develop at the web-soffit conjunction on the Western side, from the outer surfaces
of the concrete inwards. Next, after a vertical crack had worked its way through the
web-soffit conjunction, the Western web had sheared off the soffit at that point and had
dropped down onto the top of pier 2, beside the temporary bearing on that side. The
temporary bearing had not 'punched through' anything; but had continued to support the
soffit. At the same time as the Western web had sheared off the soffit and dropped
down onto the pier, similar cracks had developed at the web-soffit conjunction on the
44 Particulars of claim, p 597, "POC 15", the plaintiffs' letter dated 8th September 1998 to the second
defendants.
4S Particulars of claim, p 599, "POC 17", the plaintiffs' letter dated 5th October 1998 to the second
defendants, read with the attached letter dated 21st August 1998 from three engineers to Messrs
Deneys Reitz, attorneys, at p 600 and the diagrams at pp 601 - 604.
-35-
Eastern side of the deck segment; a similar failure had occurred; the Eastern web had
sheared off the soffit and dropped down onto the top of pier 2 beside the temporary
bearing on that side; and the latter bearing, without 'punching through' anything, had
continued to support the soffit on that side. Thereafter the launching nose had buckled
and the deck had failed both to the North and to the South of pier 2.
[74] To describe any part of this process as the temporary bearings 'punching
through' the soffit is plainly misdescription. However, that misdescription alone would
not justify either the upholding of an exception or the striking out of the misdescription.
I consider it to be clear enough, when the particulars of claim and annexes are read as
a whole, that what the plaintiffs' allegations in paragraph 35.3.1 are intended to convey
is that the second defendants' design was faulty in the respect that it was the cause of
the bridge failing in the manner described in the attachments to Annex "POC 17" at
pages 599 to 604.
[75] On that interpretation of paragraph 35.3.1, the first design fault relied upon
by the plaintiffs is that it was some shortcoming or shortcomings in the second
defendants' design, not specified in paragraph 35.3.1, that caused the bridge to fail
during construction in the manner described. As will be seen below, an indication of the
nature of the shortcomings that are alleged to have constituted the first design fault is
to be found in paragraph 35.4.
[76] The second alleged design fault is set out in paragraph 35.3.2:
'35.3.2 the web and soffit being, in any event, susceptible to failure during
construction, irrespective of the positioning of the temporary bearings,
having regard to the design constraints brought to bear by the second
defendant and the codes of practice for the design of bridges in South
Africa. '
-36-
The wording of the allegation of the second design fault is therefore for all practical
purposes identical to the wording of paragraph 49.2 in Claim II(1). It is certainly opaque
language, but it is not necessarily meaningless. Its interpretation must. await a
consideration of the remainder of the context in which it has been used.
[77] The fourth proposition on which the plaintiffs rely for their claim to be entitled
to an extension of time in terms of GCC 45(2) and (3) is -
'35.4 the Injaka bridge being unbuildable. in that:
35.4.1 the temporary bearings were placed eccentrically under the webs of
the bottom deck slab as proposed by the plaintiff in accordance
with indications given in contractual documents and drawings
prepared by the second defendant, which placement was
approved by the second defendant as being compatible with its
design, but which nonetheless resulted in the web and the soffit
failing as set out in paragraph 35.3.1 above; and/or
35.4.2 had the temporary bearings been placed as centrically as possible
under the webs of the bottom deck slab of the Injaka bridge, the
web and the soffit would have failed as set out in paragraph
35.3.2.'
Paragraph 35.4 specifies two respects in which the plaintiffs allege that the bridge was
rendered 'unbuildable' by the second defendants' conduct, one being alleged in 35.4.1
and the other in 35.4.2.
[78] As I understand it, paragraph 35.4.1 serves the following .purposes:
1. It specifies that the first design fault, which was referred to in paragraph
35.3.1 without its nature being there disclosed, was that the vertical centre lines
of the temporary bearings were offset from vertical centre lines through the
bottom points of the webs.
2. It contains the admission that the plaintiffs themselves had 'proposed' this
faulty design feature, and it seeks to transfer legal responsibility for that fact to
-37
the second defendants on the ground of the second defendants' conduct in
each of two respects, being
(1) that the second defendants had given the plaintiffs 'indications' in
unspecified 'contractual documents and drawings' that such offsetting was
required; and
(2) that, after the plaintiffs had 'proposed' the design feature (the offsetting)
that constituted the first design fault, the second defendants had approved
it as compatible with the second defendants' design for the bottom slab
and the webs of the deck of the bridge (a part of the permanent works),
when it was not compatible with such design.
[79] For the present purpose of discovering the meaning of paragraph 49.2 in Claim
II(1), this analysis of the allegations in paragraphs 35.3.1 and 35.4.1 in Claim 1 enables
me to reach the conclusions that the plaintiffs' case in Claim 1 includes allegations to
the effect that
1. the first design fault that the plaintiffs rely on as a cause of the failure of the
partially constructed bridge, is that the centre lines of the temporary bearings
had been designed to be offset from the centre lines of the bottom points of the
webs;
2. the plaintiffs admit that they themselves had 'proposed' this design, which
turned out to be faulty;
3. the conduct of the second defendants had led to the failure of the bridge
through the first design fault in that
(1) the second defendants had prepared and handed to the plaintiffs
unspecified 'contractual documents and drawings' containing 'indications'
[80]
-38-
that the centre lines of the temporary bearings should be offset from the
centre lines of the bottoms of the webs, thereby causing the plaintiffs to
'propose' the first design fault in their drawings for the temporary works;
and
(2) the second defendants had approved the plaintiffs' drawings containing the
proposal of the first design fault as being compatible with their (the
second defendants') design for the permanent works, when the first
design fault had precluded such compatibility.
4. It is evidently the plaintiffs' case in Claim I that, in the circumstances alleged,
the second defendants are bound, in their capacity - for the purposes of the
building contract - as 'Engineer' (being an agent of the first defendant, and
obliged to act fairly to both the plaintiffs and the first defendant), to allow the
plaintiffs an extension of time in terms of GCC 45(2); and the first defendant is
bound, in terms of GCC 45(4) to pay the plaintiffs such additional time-related
preliminary and general allowances as are appropriate having regard to the
time-extension.
Paragraph 35.4.2 is evidently intended to serve two purposes:
1. It distinguishes the first design fault from the second design fault by alleging
in substance that even if the first design fault had not been present, the
second design fault would in any event have resulted in the failure of the
bridge in the manner described.
2. With an express reference back to paragraph 35.3.2, paragraph 35.4.2
purports to provide further particulars of the second design fault. However,
it throws no light on the intended meaning of the vague allegations in 35.3.2
-39
relating to -
'the design constraints brought to bear by the second defendant and the
codes of practice for the design of bridges in South Africa.'
[81] Elsewhere in the particulars of claim, I find an indication of what the plaintiffs
presumably have in mind in using the vague phrase
'the design constraints brought to bear by the second defendant'.
In paragraph 23 at p 43, the plaintiffs have alleged:
'23.1
23.2
The second defendant designed a replacement bridge ("the new Injaka
bridge") to which end the second defendant conducted an in-depth review
of the design and effected material modifications, inter alia, to the design of
the reinforcement in the bottom slab of the concrete deck and to the
placement of the temporary bearings under the said slab.
The plaintiff, in turn, was instructed by the second defendant to build the
new Injaka bridge, which it duly did.'
[82] In paragraph 23.1, the phrase 'inter alia' is vague and without content. At most,
it constitutes notice that the reader may find, elsewhere in the particulars of claim,
further allegations of material modifications made to the original design of the bridge
when the second defendants designed the so-called 'new Injaka bridge'. However, I
consider that, unless the trial judge is persuaded to rule otherwise, the plaintiffs will not
be entitled by the use of the phrase 'inter alia' to introduce evidence at the trial of any
design modifications other than those that have been expressly alleged in their
pleadings; and for present purposes, I hold that the phrase 'inter alia' cannot enable the
plaintiffs to avoid any of the exceptions that have been taken and that may otherwise
be justified.
[83] With that reservation, I hold that, in the light of the context of paragraph 23.1,
the vague phrase
-40
'the design constraints brought to bear by the second defendant'
as used in paragraph 35.3.2, is not devoid of all meaning. Construed in the context to
which I have alluded, which includes paragraph 23, it is a reference to, and provides
particulars of, each of the two design faults attributed to the second defendants, namely
1. The first alleged design fault: the conduct of the second defendants, first, in
giving the plaintiffs unspecified 'contractual documents and drawings prepared
by the second defendant' containing 'indications' that the temporary bearings
should be designed to be located with their centre lines offset from the centre
lines of the bottoms of the webs; and second, after the plaintiffs had prepared
drawings for the temporary works accordingly, the second defendants' conduct
in approving, as compatible with their own design for the permanent works, the
plaintiffs' drawings reflecting this arrangement of the temporary bearings when
the arrangement was in reality not compatible with the permanent works.
2. The second alleged design fault: the second defendants' failure, in the
original design of the bottom slab of the deck segments (also referred to as the
'soffit' 46 of the deck segments), to provide for reinforcing steel to the extent
that the second defendants afterwards provided for it in the re-design that they
produced after the collapse of the bridge.
[84] As to the vague phrase in paragraph 35.3.2-
'having regard to ... the codes of practice for the design of bridges in South Africa I
46 The 'soffit' of the bottom slab is merely its under-surface. However, in the particulars of claim, the
terms 'deck' and 'soffit' have also been used to distinguish the upper slab of the deck from the lower or
bottom slab of the deck, and not merely to identify the under-surface of either slab.
-41
there appears to be only one reference to a document that might constitute such a 'code
of practice'. It is the first document in Volume 2 of the building contract, being the
'Standard Specifications for Road and Bridge Works, First Edition, December 1987' issued
by the Committee of State Road Authorities ('CSRA'), as amended in June 1991 ('the CSRA Specifications').47 It is referred to in paragraph 5.2.1 of the particulars of
claim. At pages 613 to 656, the plaintiffs have produced 42 pages of extracts from the
complete document. These are extracts from a contractual document. It is by no
means clear that it is indeed a document that the plaintiffs refer to as one of the relevant
'codes of practice', which need not necessarily be contractual documents. Even if, for
the purposes of an exception, the plaintiffs should be given the benefit of that doubt, the
position remains that, despite selecting these lengthy extracts, the plaintiffs have failed
to specify the provision or provisions of the CSRA Standard Specifications on which they
rely; 48 and, in any event, the plaintiffs have failed to identify the other relevant 'codes
of practice' on which they rely for this vague allegation.
[85] For these reasons, I consider that the words
'and the codes of practice for the design of bridges in South Africa'
where they appear in paragraph 35.3.2, are too vague to be meaningful in their context.
I consider that they would not justify the introduction by the plaintiffs of evidence relating to
design faults other than the two already specifically mentioned in the particulars of
claim, although if the matter did come to trial on these pleadings, that would be a matter
47 Particulars of claim, p 6, para 5.2.1, and pp 613 to 656; as amended in June 1991, pp 422 to 433.
48 The CSRA Standard Specifications are so lengthy and so detailed that it is, in my judgment.
unreasonable to expect the defendants and their legal advisers to comb through them in the hope of
identifying particular specifications that the plaintiffs may intend to rely on. It is for the plaintiffs to
specify them.
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for the trial judge. In any event, for purposes of the present exceptions, I regard the
last-quoted words, duly considered in their context, as lacking in meaningful content,
and I intend to ignore them.
[86] I come to the conclusion that the use in Claim I, paragraph 35, of language
similar to that in Claim II(1), paragraph 49.2, assists in arriving at the meaning of
paragraph 49.2 to the extent that, when read with paragraph 23.1, it indicates that
paragraph 49.2 contains an allusion to an alleged second design fault. The second
design fault consists of the second defendants' alleged failure to provide for reinforcing
steel in the bottom slab of the deck segments to the same extent as they afterwards
provided for such reinforcement when they re-designed the deck segments after the
failure of the bridge on 6th July 1998.
[87] The question that remains is whether the further contexts in which the wording
of paragraph 49.2 has been used or referred to, cast any further light on the meaning
of that paragraph.
The light thrown on paragraph 49 by Claim II(1)
[88] The context of Claim II(1), 49 in which paragraph 49.2 itself appears, is that
GCC 35(1)(c) provides that the contractor is to be paid the 'cost' (as defined in GCC
1(1)(h) and GCC 40) of repairing and making good any damage or physical loss caused to the
works and arising from any of the 'excepted risks' contemplated by GCC 35(2).50
49 Particulars of claim, pp 53 to 62, paras 38 to 53.
50 Certain risks are 'excepted' in the sense that they are excepted from the general provision of GCC 35(1)(b) to the effect that the Contractor is to repair and make good, at his own cost, any
damage or physical loss that may happen to the works or the materials on site while he is responsible
for the care thereof. If damage or physical loss results from the materialization of an 'excepted risk',
and the Contractor is ordered to repair it and make it good, he is entitled to be paid for doing so. The 'Contractor'
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Paragraph 49 contains the plaintiffs' allegations relating to events that they evidently
intend to characterize as the materialization of certain 'excepted risks'. The plaintiffs'
allegations in paragraphs 49.1, 49.2 and 49.3 are apparently intended to specify the
events on which they rely in this regard. The question is whether paragraph 49.2 is too
vague and obscure to be meaningful, or whether, when its context has been fully
understood and it has been properly construed in context, it does in fact amount to a
reasonably sufficient allegation of an identifiable event constituting the materialization
of an 'excepted risk'
[89] The immediate context of paragraphs 49.1 and 49.3 is as follows
1. The wording of paragraph 49.1, which must be read with paragraph 49.3.1, is
substantially the same as that of paragraph 35.3.1 read with paragraph 35.4.1
in Claim I. The effect is that what I have described in relation to Claim I as the
second defendants' conduct alleged to have caused the first design fault 51
which, in Claim I, gave rise to a contractual claim in terms of GCC 45(2), (3)
and (4) for an extension of time, and for payment of associated preliminary and
general expenses, serves a different purpose in Claim II(1). In Claim II(1) the
the second defendants' conduct alleged to have caused the first design fault
is characterized as the materialization of an 'excepted risk' contemplated by
is, of course, the plaintiff company.
51 i.e. offsetting the centre lines of the temporary bearings from the centre lines of the bottoms of the webs. The plaintiffs admit in paragraph 49.3.1 that they 'proposed' this arrangement. However,
they seek to lay the legal responsibility for it at the second defendants' door on the grounds, first, that
the second defendants gave them certain unspecified 'contractual documents and drawings' containing
'indications' that the temporary works should be designed accordingly; and second, that when the
plaintiffs had produced drawings for the temporary works in accordance with the second defendants'
indications, the second defendants had approved the drawings as compatible with their design for the
permanent works, when the plaintiffs' drawings were not in fact compatible with such designs.
-44-
GCC 35(2)(j).52 The plaintiffs therefore allege that it gives rise to a contractual
claim against the first defendant in terms of GCC 35(1)(c) for the cost of
carrying out the second defendants' order to repair and make good the damage
and physical loss to the works and the materials on site, caused by the
materialization of that excepted risk.
2. Paragraph 49.2 must be read with paragraph 49.3. The wording of these
paragraphs is substantially the same as that of paragraph 35.3.2 read with
paragraph 35.4.2 in Claim I. The effect is that the allegations in Claim I that
outline what I have called the second design fault (failing to provide for
reinforcement for the bottom slabs of the deck segments to the same extent as
was done on redesign after the collapse) are repeated in Claim II(1) with a
different purpose. The new purpose is that of identifying the materialization of
a second 'excepted risk' contemplated by GCC 35(1)(c) and GCC 35(2)(j) and
therefore entitling the plaintiffs to payment of the cost of implementing the
second defendants' order to repair and make good the damage and physical
loss caused by the second 'excepted risk'.
[90] Again, the second 'excepted risk', related as it is to the second design fault,
is distinguished from the first 'excepted risk' and the first design fault by the allegation
that even in the absence of the first design fault (i.e. if the design had provided for the
centre lines of the temporary bearings to be located directly below the centre lines of the
bottoms of the webs), the second design fault would in any event have constituted a
second 'excepted risk' entitling the plaintiffs to the same relief. The nature of the
52 i.e. a risk of damage or physical loss or any other loss caused by or arising directly or indirectly as a
result of or as a consequence of the design, specification or instruction of the second defendant company as the 'Engineer'.
-45
second 'excepted risk' has not been alleged in Claim II(1) otherwise than by the vague
words:
'having regard to the design constraints brought to bear by the second defendant and the codes of practice for the design of bridges in South Africa.'
However, for the same reasons as I gave when considering these words in the context
of Claim I, I am of the opinion that -
1. the plaintiffs, by using the words
'having regard to the design constraints brought to bear by the second
defendant'
must be understood to have alleged that an excepted risk contemplated by
GCC 35(2)(j) had materialized when the second defendants, in the course of
preparing the original design for the deck segments, had failed to provide.for
reinforcement in the bottom slab to the same extent as they did later, when
redesigning it after the collapse, as alleged in paragraph 23.1 (and that they
had not alleged anything more than that); and
2. the plaintiffs' allegation
'having regard to ... the codes of practice for the design of bridges in South Africa '
is too wide and vague to convey any intelligible meaning in the context, and it
ought not to be allowed to serve as the basis for leading any evidence relating
to the design of bridges that is not already covered by the plaintiffs' specific
allegations identifying the first and second design faults, as set out above.
For the purposes of the present exceptions, I regard the last-quoted allegation
as pro non scripto and I shall accordingly ignore it.
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[91] I proceed to consider whether further light is thrown on paragraph 49.2 by the
remaining contexts in which its wording is repeated or referred to. There is no such
repetition or reference in Claim II(2). 53
The light thrown on paragraph 49.2 by Claim III(1)
[92] Claim III(1) 54, and its alternative, Claim III(2) 55, are claims in delict that are
directed against the first defendant alone. In both claims the first defendant is alleged
to be vicariously liable for the delicts of the second defendants. Reading the plaintiffs'
allegations in Claim III(1) with a degree of indulgence that is directed to understanding
the substance of the cause of action that the plaintiffs seek to make out, without being
unduly critical of the words that they have chosen, or of their omission of propositions
that have evidently been left to implication, I consider that, at least for the present
purpose of trying to discover what light the context of Claim III(1) may shed on
paragraph 49.2, I should assume that Claim III(1) includes further allegations, and
implied allegations, to the following effect:
1. The second defendants had certain contractual obligations, specified in
paragraph 63, that they owed to the first defendant in terms of the consultancy
agreement.
2. The second defendants' contractual obligations in terms of the consultancy
agreement with the first defendant included the obligation to discharge the
contractual obligations specified in paragraph 63 with reasonable skill, care and
53 Paragraphs 54 to 61, at pp 62 to 64.
54 Paras 62 - 67, at pp 64 to 67.
55 Paras 68 - 72, at pp 67 to 70.
-47
diligence. 56
3. By implication, the plaintiffs must be understood to have made further
allegations to the following effect :- 57
(1) The contractual obligations specified in paragraph 63 were all obligations
the performance of which by the second defendants controlled and
otherwise affected the performance by the plaintiffs of their obligations to
the first defendant in terms of the building contract.
(2) By virtue of this 'proximity' between the plaintiffs and the second
defendants, and the absence of any contract between them, the second
defendants also owed a (non-contractual) legal duty to the plaintiffs to
exercise reasonable skill, care and diligence in performing the specified
contractual obligations that they owed to the first defendant under the consultancy agreement.
(3) The legal duty owed by the second defendants to the plaintiffs
encompassed the exercise of reasonable skill, care and diligence in - 58
(a) preparing the design of the permanent works, in particular in relation
to the reinforcing steel in the bottom slab of the segments of the
bridge deck, having regard to the forces that the bottom slab would
have to withstand during the incremental launching;
(b) issuing documents and drawings that would indicate to the plaintiffs
56 Particulars of claim, para 64; and p 534, Consultancy Agreement. clause 4.2.
57 Unless some such allegations are taken to be implied, Claim III(1) is obviously lacking in allegations necessary to set out a cause of action in delict. For the present purposes of determining whether Claim III(1)
throws light on the meaning of paragraph 49.2, I assume that these allegations are implied. 58 These implications seem to me to follow from the cryptic allegations in paragraph 66.3 at p 66.
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where the plaintiffs' drawings for temporary works should locate the
temporary bearings on the piers for purposes of the implementation
of the incremental launching method;
(c) approving as compatible with the second defendants' design for the permanent works, the plaintiffs' drawings for temporary works relating
to the location of temporary bearings for the implementation of the
incremental launching method.
4. The second defendants 'wrongfully' failed to perform the specified contractual
obligations owed to the first defendant in terms of the consultancy agreement
with reasonable skill, care and diligence, and were negligent. 59
5. The second defendants thereby committed a breach of the consultancy
agreement. 50"
6. By implication, this conduct on the part of the second defendants also
amounted to a breach of the legal duty owed by them to the plaintiffs. 61
7. The conduct of the second defendants amounted to a breach of the legal duty
that they owed to the plaintiffs because such conduct was
'wrongful and/or negligent for the reasons set forth mutatis mutandis in
paragraph 49 above.' 62
8. Because the first defendant had authorized the second defendants'
59 Para 65, at p 66.
60 Para 65.
61 Such an allegation must be implied. Without it, there can be no question of delictual liabilityon the part of the second defendants to the plaintiffs. In order to be in a position to deal with the
substance of the matter, I assume that such an allegation is implied.
62 Para 66.3, at p 66.
-49-
performance of their contractual obligations, and/or because the second
defendants had sought to obtain the result authorized by the first defendant,
the first defendant was vicariously liable to the plaintiffs for the damages that
they, the plaintiffs, claimed to have sustained in consequence of the second
defendants' wrongful and negligent conduct. 63
[93] The question is whether the context of Claim III(1) sheds any light on the
meaning of paragraph 49.2.
[94] In attempting to answer this question, the first problem to be encountered is
that, contrary to the plaintiffs' suggestion in paragraph 66.3. paragraph 49 does not
purport to contain any reasons for concluding that the conduct of the second defendants
was 'wrongful'. In the context of the law of delict, on which Claims III(1) and (2) are
. . . '. .
founded, 'wrongfulness' consists of the breach of a legal duty (other than a. contractual
duty). Paragraph 49 does not deal with this concept expressly or by implication.
[95] The basic proposition in paragraph 49, in which the elements of Claim II(1) are
set out, is that a contractual condition set out in GCC 35(1)(c) had been fulfilled and that
its fulfilment entitled the plaintiffs to payment by the first defendant. The contractual
condition was the causing of damage or physical loss to the works arising from any of
several specified 'excepted risks', and its repair and making good by the plaintiffs on the
order of the second defendants. The 'excepted risk' relied upon by the plaintiffs is the
one defined by GCC 35(2)(j), namely the risk of
'damage or physical loss or any other loss caused by... the design,
specification or instruction' [of the second defendants.]
In subparagraphs 49.1 and 49.3.1 the plaintiffs set out the nature of the first design
63 Paras 66.1, 66.2 and 67, at pp 66 to 67.
-50
fault. 64 They concede that it was 'proposed' by themselves. They also set out
particulars of the alleged conduct of the second defendants that they claim entitled
them, the plaintiffs, to payment by the first defendant in terms of GCC 35(1)(c). In
subparagraphs 49.2 and 49.3.2 the plaintiffs set out a second design fault attributed
to the second defendants. 65 The plaintiffs' case in Claim II(1) is that one or other or
both of the alleged design faults, for which the second defendants are alleged to have
been responsible, had caused damage or physical loss to the works; that an 'excepted
risk' had therefore materialized; that they, the plaintiffs, had repaired the damage and
physical loss and made it good on the order of the second defendants; that the condition
in GCC 35(1)(c) had thereby been fulfilled; and that they had accordingly become
entitled to payment on those contractual grounds.
[96] However, in paragraph 66.3, in Claim III(1), the plaintiffs suggest that
paragraph 49 contains 'reasons' for concluding that the second defendants' breach of
the consultancy agreement (and in particular the breach of their contractual duties to the
first defendant set out in paragraphs 63 and 64) through negligent conduct on their part
(as alleged in paragraph 65) was 'wrongful' in a delictual sense. 66 Yet paragraph 49
64 Viz. the alleged design fault resulting from the second defendants' giving the plaintiffs unspecified 'contractual documents and drawings' (as alleged in para 49.3.1) indicating that the centre lines of the temporary bearings should be offset from the centre lines of the bottoms of the webs, which in turn resulted in the plaintiffs' preparing drawings for the temporary works accordingly, and in the second defendants' approving the plaintiffs' drawings as compatible with the second defendants' design for the permanent works, when the plaintiffs' drawings were not compatible with such design.
65 Viz. the alleged design fault resulting from the second defendants' failing at the outset to design the bottom slab of the deck of the bridge (a part of the permanent works) with as much reinforcing steel
as was necessary to afford it the degree of strength that they, the second defendants, gave to it when they
redesigned the segments of the bridge after the collapse on 6th July 1998.
66 This appears to be confused thinking on the part of the plaintiffs. However, I am at this stage dealing
only with the question of the meaning of paragraph 49.2 in its full surrounding context. At a later stage,
-51-
does not contain any such reasons.
[97] Nevertheless, paragraph 66.3 also contains the phrase 'mutatis mutandis'. The
plaintiffs' use of the phrase in this context is by no means precise. It gives rise to a
further question. What are the propositions in paragraph 49 that are 'meet to be
changed' 67 for the purposes of paragraph 66.3 and that, 'having been changed', 68 will
reveal the intended purport of paragraph 66.3? The answer is not immediately clear.
However, I do not think that the obscurity is so serious that paragraph 66.3 must be
dismissed as entirely meaningless. In my judgment, paragraph 66.3, read in its context,
can and should reasonably be understood to amount to allegations (largely implied) to
the effect that
1. The contractual setting of the two design faults alleged in paragraph 49 (giving
rise to the plaintiffs' claim based on the fulfilment of a contractual condition in
the building contract between the plaintiffs and the first defendant) should be
changed to the setting in the law of delict that is envisaged by Claim III
(paragraphs 62 to 67). With this implied change, the conduct of the second
defendants referred to in paragraph 49 is by implication alleged to have been
wrongful and negligent on the strength of the following further propositions.
2. The second defendants were obliged by their consultancy contract with the first
defendant, to perform certain tasks specified in paragraph 63 of the particulars
of claim.
3. The second defendants' contractual obligations to the first defendant that the
when dealing with the main points of the exceptions, I shall have to return to the question whether the
allegation that a breach of contract is 'wrongful' in a delictual sense is right or wrong as a matter of law.
67 . mutandis'
68 I mutatis'
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plaintiffs have specified in paragraph 63, read with the plaintiffs' contractual
obligations to the first defendant in terms of the building contract, gave the
second defendants certain powers of control over the plaintiffs, the exercise
of which powers of control affected the manner in which the plaintiffs were to
perform their obligations to the first defendant in terms of the building contract.
4. By reason of these circumstances, the second defendants were, as a matter
of the law of delict, burdened with legal duties owed to the plaintiffs, the
intentional or negligent breach of which would be 'wrongful'.
5. The second defendants, as alleged in paragraph 49 -
(1) designed the permanent works of the bridge with the second design fault
referred to in paragraph 49 (the inadequate reinforcing steel in the bottom
slab of the deck segments), which fault rendered the bridge liable to
collapse during the course of construction; and
(2) exercised their powers over the plaintiffs derived from GCC 6(3) 69 read
with clause 4 of the consultancy agreement, 70 in the following ways
69 Particulars of claim, p 183: 'Work to be to Engineer's instructions
6(3) The Contractor shall, in carrying out his aforesaid obligations, comply with the Engineer's
instructions on any matter relating to the Works.'
70 Particulars of claim, pp 534 - 535 and, in particular, the second defendants' obligations to the first
defendant '4.1 ... [as the first defendant's] agent ... to report on, to design and to administer the
construction of the Works. ...' '4.7.1 ... [to exercise professional] judgment ... to provide the [first defendant] with a
greater degree of confidence that the completed work of the [plaintiffs] will
conform generally to the Contract documents and that the integrity of the design
concept, as reflected in those documents, has been implemented and preserved
by the [plaintiffs]'
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(a) by handing the plaintiffs certain unspecified 'contractual documents
and drawings prepared by the second defendant' containing
'indications' that caused the plaintiffs to prepare temporary works
drawings reflecting a design 71 in which the plaintiffs 'proposed' the
first design fault (that the centre lines of the temporary bearings
should be offset from the centre lines of the bottoms of the webs);
(b) by approving the plaintiffs' drawings for temporary works as being
compatible with the second defendants' design for the permanent
works, as alleged in paragraph 49.3.1, when the plaintiffs' drawings
in fact reflected the first design fault and in that respect were not
compatible with the design for the permanent works;
(c) by thereby obliging the plaintiffs to attempt to construct the bridge in
accordance with the first design fault. 72
6. By the exercise of the second defendants' powers as 'the engineer' in terms of
the building contract, the second defendants required the plaintiffs to build the
bridge in accordance with one or other or both of the design faults alleged in
paragraph 49.
7. The second defendants' conduct alleged in paragraphs 5 and 6 above was
negligent in the respect that a reasonable engineer in the position of the
second defendants would not have introduced either of the two design faults;
would not have approved as compatible with the design for the permanent
71 GCC 6(1)(b), p 183, obliged the plaintiffs to 'design' the temporary works.
72 GCC 16(11), p 189.
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works the plaintiffs' drawings that proposed the first design fault; and would
not have required the plaintiffs to build the bridge in accordance with the faulty
design.
8. The second defendants' conduct alleged in paragraphs 5 and 6 above was
wrongful because it amounted to the breach of the second defendants' legal
duty to the plaintiffs that had arisen out of both -
(1) the legal proximity of the plaintiffs and the second defendants; and
(2) the powers exercised by the second defendants over the plaintiffs in terms
of the consultancy agreement and the building contract.
[98] In my view, the context of Claim III(1) sheds no additional light on the nature
of the second design fault alleged in paragraph 49.2. The allegation of vicarious
liability on the part of the first defendant takes that question no further.
The light thrown on paragraph 49.2 by Claim III(2)
[99] The next question is whether the context of Claim III(2) throws light on the
meaning of paragraph 49.2.
[100] Claim III(2) 73 is based on allegations of a misstatement made negligently and
wrongfully by the second defendants to the plaintiffs, causing the plaintiffs to suffer
damages, for which the first defendant is alleged to be vicariously liable to the plaintiffs. [101 ] The plaintiffs make allegations to the following effect:
1. The plaintiffs had prepared certain drawings. Their drawings had included
certain drawings of the temporary works that were not compatible with the
design of the permanent works
73 Para's 68 to 72.
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'for the reasons set out mutatis mutandis in paragraph 49 above.' 74
2. The plaintiffs had submitted these drawings, including the incompatible drawings,
to the second defendants for their approval. 75
3. The second defendants had approved the plaintiffs' drawings, including the
incompatible drawings. 76
4. The second defendants had owed the plaintiffs a legal duty not to make a
misrepresentation or misstatement (in respect of the incompatible drawings). 77
5. The second defendants' approvals of the plaintiffs' incompatible drawings had
constituted a misrepresentation or misstatemenes
6. The misstatement had been made negligently. 79
7. The plaintiffs had relied upon the misstatement - so
'in that: 69.4.1. the design of the permanent works and/or the drawings for the
temporary works as approved by the second defendant and/or the
interface between the permanent works and the temporary works for
which the second defendant was responsible was insufficient and/or
inadequate and/or inappropriate for their purpose and resulted in the
Injaka bridge being unbuildable and susceptible to collapse and/or
failure for the reasons, inter alia, set out in paragraph 49 above,
mutatis mutandis; and
the Injaka bridge, in consequence, collapsed and/or failed, 69.4.2
74 Paras 68.1 and 68.2, at p 67.
75 Para 68.1.
76 Para 68.1.
77 Para 69.2.
78 Para 69.1.
79 Para 69.3.
80 Para 69.4.
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notwithstanding that the plaintiffs drawings of the temporary works
were approved and that the Injaka bridge was built in accordance with
the building contract and drawings as defined in the GCC.'
8. The second defendants' performance of their obligations referred to in
paragraph 63 had been
'wrongful and negligent for the reasons set forth, mutatis mutandis, in
paragraph 49 above'. 81
9. The second defendants' misstatement had caused the plaintiffs to suffer 'loss
and/or damage'. 82
10. The first defendant had been vicariously liable for the second defendants'
delictual conduct. 83
[102] The following problems arise out of the plaintiffs' three references to paragraph
49 in Claim III(2):
1. Paragraph 49, as interpreted above in its place in Claim II(1), sets out
allegations of fact that are directed to showing that a contractual condition has
been fulfilled and that the plaintiffs have accordingly become entitled to a
payment in terms of the contract. It does not purport to give reasons why the
plaintiffs' drawings for the temporary works were incompatible with the design
for the permanent works, as suggested in paragraph 68.2 for the purposes of
Claim III(2).
2. It does not purport to give reasons for the insufficiency, inadequacy or
inappropriateness suggested in paragraph 69.4.1 for the purposes of Claim
81 Paragraph 71.3.
82 Para's 69.4 and 70.
63 Para's 71.1, 71.2 and 72.
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III(2).
3. It does not purport to give reasons why the performance by the second
defendants of their obligations referred to in paragraph 63 was 'wrongful and
negligent', as suggested in paragraph 71.3.
4. It confronts the reader with a vague use of the phrases 'inter alia' and 'mutatis
mutandis' .
[103] Nevertheless, I consider that Claim III(2) is not to be dismissed as meaningless.
As used in paragraphs 68.2 and 71.3, I consider that the phrase 'mutatis mutandis'
should be understood to justify the transposition of the allegations in paragraph 49 from
their contractual setting in Claim II(1) into the delictual setting of Claim III(2), being a
claim for damages alleged to have been caused by misstatements made by the second
defendants wrongfully and negligently, for which the first. defendant is said to be
vicariously liable.
[104] The phrase 'inter alia' as used in paragraph 69.4.1 would not, in my view,
entitle the plaintiffs to introduce evidence of, any 'reasons' (i.e. factual grounds
constituting facta probanda), other than those that have been pertinently set out
somewhere in the particulars of claim. 84 For purposes of the present exception
proceedings, I hold that the phrase 'inter alia', as used in this context, is too vague to
amount to the allegation of any 'reasons' (i.e. grounds constituting facta probanda) that
have not been pertinently set out in the particulars of claim.
[105] When this transposition of paragraph 49 is done, Claim III(2) can, in my
judgment, be paraphrased as follows:
B4 Of course, if this matter were to come to trial on these pleadings, this would be a matter for the trial
judge to decide.
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1. The second defendants handed some unspecified 'contractual documents and
drawings prepared by the second defendant' to the plaintiffs. 85
2. These documents and drawings contained unspecified 'indications' that the
vertical centre lines of the temporary bearings should be offset from the vertical
centre lines through the bottoms of the webs. 86
3. As a result of such 'indications', the plaintiffs prepared drawings for the design
of the temporary works, in which drawings the plaintiffs 'proposed' what has
been described above as the 'first design fault' (that the vertical centre lines
of the temporary bearings should be offset from the vertical centre lines
through the bottoms of the webs). 87
4. The plaintiffs submitted their drawings proposing the first design fault to the
second defendants for approval, and the second defendants approved such
drawings. 88
5. The second defendants thereby represented to the plaintiffs that the plaintiffs'
drawings proposing the first design fault were compatible with the second
defendants' design for the permanent works. 89
6. As a result of the first design fault, during the launching of the deck on 6th July
1998, the webs of the deck segment passing over the temporary bearings on
pier 2 sheared off the bottom slab of the deck segment beside the temporary
bearings, as agreed by three engineers in the letter dated 21 August 1998 and
85 Para 49.3.1.
86 Para 49.3.1.
87 Para 49.3.1.
88 Para 49.3.1.
89 Para 49.3.1, read with para's 68.1,68.2 and 69.
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the diagrams attached thereto, 90 (all attached to and forming part of Annex
"POC 17" to the particulars of claim), and the bridge failed further, as already
described.
7. The first design fault rendered the plaintiffs' drawings for the temporary works
and the second defendants' design for the permanent works incompatible with
each other 91 in that -
(1) the offsetting of the centre lines of the temporary bearings from below the
centre lines of the bottoms of the webs, in accordance with the plaintiffs'
drawings, would subject the web-soffit conjunctions, as designed by the
second defendants, to forces that they had not been designed to
withstand; and, in the launching of the deck, the web-soffit conjunctions
proved incapable of withstanding such forces; 92 and
(2) when the second defendants redesigned the bridge after the collapse, they
corrected the first design fault by altering the positioning of the centre
lines of the temporary bearings relative to the centre lines of the bottoms
of the webs, 93 and the plaintiffs successfully built the bridge as so
redesigned.
8. The second defendants' representation to the plaintiffs that the plaintiffs'
drawings for the temporary works and the second defendants' design for the
permanent works were compatible with each other was therefore a
90 Particulars of claim, pp 599 to 604. This is the incident that the plaintiffs have misdescribed in
paragraph 49.1 as' the temporary bearings punching through the soffit at Pier 2'.
91 Para 69.4.1.
92 Para's 49.1; 49.3.1; 68.1; 68.2; 69, and 69.1.
93 Para 23.1.
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misstatement.
9. The second defendants made the misstatement negligently and wrongfully. 94
10. The misstatement was made negligently in that the reasonable man in the
position of the second defendants would not have made it. Such a reasonable man would have established and recognized that the bridge could not be built
as designed because of the incompatibility between the strength of the
conjunction between the webs and the bottom slabs, as designed by the
second defendants, and the plaintiffs' proposal in the drawings for the
temporary works to offset the vertical centre lines of the temporary bearings
from the vertical centre lines of the bottoms of the webs. The reasonable man
would have declined to approve the plaintiffs' drawings as compatible with the
second defendants' design for the permanent works, and would have informed
the plaintiffs accordingly. 95
11. The misstatement was made wrongfully in that it was made in breach of a legal
duty on the part of the second defendants not to make such a misstatement to
the plaintiffs. 96
12. The plaintiffs relied upon the misstatement and suffered loss or damage in
consequence of it; the second defendants are accordingly liable to the plaintiffs
for damages in delict; and the first defendant is vicariously liable for the same
damages. 97
94 Para 71.3.
95 Para's 49.1; 49.3.1; 23.1; 69.3 and 71.3.
96 Para 69.2.
97 Para's 69.4 to 72.
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[106] In my view, the context of Claim III(2) does not throw any additional light, over
and above that which has already been discerned, on the meaning of paragraph 49.2.
[107] Claim IV does not contain any reference to paragraph 49 and throws no light
on its meaning.
The light thrown on paragraph 49.2 by Claims V(1) and (2)
[108] I turn next to consider whether Claims V(1) and (2) shed any light on the
meaning of paragraph 49.2. These are the plaintiffs' claims in delict against the second
defendants alone.
[109] In Claim V(1) - 98
1. The plaintiffs allege that the second defendants 'undertook' the design of the
permanent works and the co-ordination of the design of the permanent works and the temporary works. 99 Although there is no express reference in Claim
V(1) to the consultancy agreement, this allegation can only be based on that
contract between the first and second defendants. No contractual link involving
any 'undertaking' between the plaintiffs and the second defendants has been
alleged. Indeed, on the strength of clause 4.1 of the consultancy agreement, 100
the plaintiffs have expressly alleged that there was no contract between
themselves and the second defendants. 101
2. The plaintiffs allege further:
98 Particulars of claim, pp 73 to 78, para's 83 - 90.
99 Para 83.
100 Particulars of claim, p 534.
101 Particulars of claim, p 35, para 12.2, lines 9 to 11.
-
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'84 The second defendant. in performing its obligations as the agent of the firstdefendant in relation to the scrutiny and approval of the temporary worksdrawings submitted by the plaintiff, assumed an obligation to ensure that: ...'
certain pitfalls referred to in paragraphs 84.1 and 84.2 would be avoided. 102
'85.1 The second defendant knew, alternativelv, ought reasonably to have known that the plaintiff would rely upon the second defendant: (to do six things specified in 85.1.1 to 85.1.6)
85.2
The second defendant further knew or foresaw. alternativelv ought reasonably to have known or foreseen that if it failed to perform the second defendant's obligations and/or any of the obligations contemplated by paragraphs 84.1 103 and/or 85.1 above in a skilful, careful and diligent fashion ...'
certain consequences, adverse to the plaintiffs, would ensue.
3. The plaintiffs also alleged what a reasonable engineer in the position of the
second defendants would have done in the circumstances, 104 and continued:
'87 The second defendant, in the premises, owed the plaintiff a duty of care to
ensure that it discharged the second defendant's obligations 105 and those
102 There is ambiguity in the plaintiffs' allegation that the second defendants 'assumed an obligation',
because the alleged assumption of an obligation may be based on an interpretation of the consultancy
agreement between the first and second defendants, or it may constitute an allegation of the
assumption by the second defendants of a non-contractual legal obligation owed to the plaintiffs, the
breach of which would give rise to a remedy in delict. available to the plaintiffs against the second
defendants. It is not necessary to deal with this ambiguity for the purposes of the question now under
consideration, namely, the interpretation of paragraph 49.2. However, it will be necessary to return to
the ambiguity later, for other purposes.
103 The omission of a reference to paragraph 84.2 appears to be an unintentional oversight on the part of
the plaintiffs. 1 shall proceed on the assumption that such a reference was intended.
104 Para 86.
105 This appears to be a reference back to the second defendant's "obligations" as alleged in paragraphs
83 and 84 on p 73. The reference is, in other words, a reference to the second defendants' contractual
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contemplated in paragraphs 84.1 106 and/or 85.1 above with reasonable skill, care
and diligence and to ensure that the Injaka bridge was not susceptible to collapse
and/or failure, during construction.
88 Wrongfully and negligently, and in breach of the aforesaid duty of care, the
second defendant:
88.2
performed the second defendant's obligations and/or the obligations contemplated in paragraphs 84.1 102 and/or 85.1 above in a manner
which has resulted; alternativeIv
failed to perform the second defendant's obligations and/or the obligations contemplated in paragraphs 84.1 102 and/or 85.1 above resulting
in the design of the permanent works and/or the temporary works and/or the interface
between the permanent works and the temporary works being insufficient and/or
inadequate and/or inappropriate for their purpose and/or resulted in the Injaka bridge
being unbuildable and susceptible to collapse and/or failure, mutatis mutandis, for the
reasons, inter alia, set out in paragraph 49 above, notwithstanding that the plaintiffs
drawings of the temporary works were approved and that the Injaka bridge was built
in accordance with the building contract and drawings as defined in the GCC.'
88.1
4. The plaintiffs went on to allege that the second defendants' breach of their duty
of care had caused the plaintiffs to suffer damages and that the second
defendants were liable therefor. 103
[110] The question that arises is whether the context of Claim V(1) sheds light on the
obligations to the first defendant in terms of the consultancy agreement, and it again raises the
question of ambiguity referred to above, namely, whether the plaintiffs intend to imply that the second
defendants also owed a (non-contractual) legal duty to the plaintiffs.
106 Again, the omission of a reference to paragraph 84.2 appears to be an unintentional oversight, and I
shall proceed on the assumption that such a reference is intended.
103 Para's 89 and 90.
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meaning of paragraph 49.2.
[111] The legal duties alleged and relied upon by the plaintiffs as having arisen from
the circumstances alleged in Claim V(1), and as having been owed by the second
defendants to the plaintiffs, and as having been breached by the second defendants,
may be summarized as follows:
1. An alleged legal duty on the part of the second defendants to provide a design
in terms of which the permanent works of the segments of the deck would have
the structural strength necessary to enable them to withstand the forces to
which they would be subjected when being launched in the course of the
incremental launching method of construction; and in particular a design that
would ensure that the bottom slab of each deck segment had sufficient
reinforcing steel in a design appropriate to afford it the necessary strength to.
survive the launching process, at least if the centres of the temporary bearings
were located vertically below the centre lines of the bottoms of the webs. The
second defendants are alleged to have breached this duty when they provided
a design for the permanent works that contained the second design fault
referred to above, i.e. an unspecified fault in the reinforcement of the bottom
slab of the deck segments. 104
2. A duty to co-ordinate the second defendants' own designs for the permanent
works and the plaintiffs' drawings for the temporary works in such a way as to
ensure that the bridge would both be 'buildable' by the incremental launching
method and would be fit for its purpose. This involved, in particular, a duty
owed by the second defendants to the plaintiffs to examine the plaintiffs'
104 Para's 83; 85.1.6; 85.2; 86.5; 87; 88; 49.2; 49.3.2 and 23.1.
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drawings for the temporary works for compatibility with the second defendants'
design for the permanent works with reasonable skill, care and diligence. The
second defendants are alleged to have breached this duty (and therefore to
have acted wrongfully) when they approved the plaintiffs' drawings for the
temporary works as compatible with the second defendants' design for the
permanent works despite the fact that the plaintiffs' drawings contained the
first design fault. The incorporation of the first design fault doomed the
bridge to failure when the incremental launching method was implemented i.e.
rendered the bridge 'unbuildable' by that method. 105
[112] The first design fault consisted of the fact that the plaintiffs' drawings for
temporary works had 'proposed' that the vertical centre lines of the temporary bearings
on the abutments and piers should be offset from the vertical centre lines through the
bottoms of the webs so that the temporary bearings would not provide support vertically
below the centres of the webs of the deck segments. As the deck segments moved
over the temporary bearings in the implementation of the incremental launching method,
each temporary bearing would provide support under the soffit along a vertical line that
was offset from the nearest web. This arrangement would result in forces of tension and
compression in and around the web-soffit conjunction.
[113] It is evident that the gist of Claim V(1) is the allegation that the second
defendants are liable to the plaintiffs for the breach of a legal duty ('the first duty') to
have refrained from approving the first design fault (contained in the plaintiffs'
drawings); or for the breach of a legal duty ('the second duty') to have avoided
introducing the second design fault (contained in the second defendants' own
105 Para's 83; 85.1.1 to 85.1.5; 85.2; 86.1 to 86.3; 87; 88: 49.1: 49.3.1 and 23.1.
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drawings); or for the breach of both such alleged duties. The plaintiffs have alleged both
the first and the second duties, at least by implication, by the incorporation 'mutatis
mutandis' in paragraph 88 of 'reasons' (or allegations of factual grounds) set out in
paragraph 49.
[114] In my view, the context of Claim V(1) adds nothing to what has already been
ascertained about the meaning of paragraph 49.
[115] Claim V(2) 106 is an alternative to Claim V(1), directed against the second
defendants alone. In it, the plaintiffs claim their damages in delict on the basis of an
alleged misstatement made by the second defendants wrongfully and negligently. Claim
V(2) is a repetition of Claim III(2), from which only the allegations relating to the
suggested vicarious liability of the first defendant have been omitted. 107 Consequently,
Claim V(2) depends upon the meaning of paragraph 49.2 to precisely the same extent
as Claim III(2), and throws no additional light on its meaning.
[116] Turning to the plaintiffs' allegations in paragraph 49.1, 108 duly read in the
context of the remainder of the particulars of claim, I consider their substance to be as
follows. The plaintiffs allege that the second defendants had designed the web-soffit
106 Particulars of claim, pp 79 to 81, para's 91 -95.
107 Paragraphs 91 to 93 in Claim V(2) have precisely the same wording as paragraphs 69 to 70 in ClaimIII(2).
108 The allegations made in paragraph 49.1 have also been incorporated 'mutatis mutandis' in other paragraphs associated with allegations of the kind made in paragraph 49.2: see in particular:
Claim I: para's 35 3.1 and 35.4.1;
Claim II(1): para's 49.1 and 49.3.1;
Claim III: para 66.3;
Alternative Claim III(2): para's 68.2, 69.4.1 and 71.3;
Claim V: para 88;
Alternative Claim V(2): para's 91.2 and 92.4.1.
-
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conjunction to have a certain degree of strength that is not precisely specified in the
particulars of claim; that the designed strength was such that it would be insufficient to
withstand the moment 109 to which the web-soffit conjunction would be subjected during
the launching process, when a segment in a position such as segment 2, was made to
slide over temporary bearings positioned as those on a pier such as pier 2, i.e. not
positioned vertically beneath the webs, but offset from them medially, i.e. towards the
centre line of the soffit. The context indicates that it is the plaintiffs' case that segment
2 (unlike segment 1) would press down on the temporary bearings on pier 2 with not
only its own weight but also with the addition of so much of the weight of segment 1
(attached to the Northern end of segment 2) and so much of the weight of segment 3
(attached to the Southern end of segment 2) as segment 2 would have to bear in that
position. 110 The vertically downward force exerted on the temporary bearings on pier
2 by the weight of segment 2, supplemented by so much of the weight of segments 1
and 3 as segment 2 was carrying, would have been opposed by the vertically upward
force of support afforded to the soffit of segment 2 by those bearings. However, the
positioning of the upward force of support at points of the soffit at a distance from the
webs on either side, inevitably produced moments at the web-soffit conjunctions on
either side. The designed strength of the reinforced concrete in the vicinity of the web
109 i.e. the 'turning effect produced by a force acting at a distance on an object': New Oxford Dictionary
of English, 2001.
110 The annexes to the particulars of claim indicate that it is the plaintiffs' case that Segment 1 was at the crucial
moment of time suspended between Pier 2 and Pier 3. About one-half of the weight of Segment 1 would
have been transmitted through the launching nose to the temporary bearings on Pier 3. The other half of
the weight of Segment 1 would have been transmitted through Segment 2 to the temporary bearings on Pier 2. Similarly, the weight of Segment 3, suspended between Pier 2 and Abutment 1, would havebeen distributed through Segments 2 and 4 to Pier 2 and Abutment 1 respectively.
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soffit conjunction was insufficient to withstand the tensions and compressions that would
be, and that were, produced by these opposing forces.
[117] To sum up, the allegations in paragraph 49, as repeated elsewhere in the
particulars of claim, are central to two of the plaintiffs' contractual claims and all four
of their claims in delict.
A The two contractual claims based on paragraph 49
1. The plaintiffs have made those contractual claims in which paragraphs 49.1
(read with 49.3.1 and 23.1) and 49.2 (read with 49.3.2 and 23.1) feature,
against the first defendant alone. They have been made in terms of the
building contract to which only the plaintiffs and the first defendant were
parties. The second defendants were not parties. Nevertheless, the second
defendants are concerned in these claims to the extent that they are alleged
to have acted as the agents of the first defendant and, in so doing, to have rendered the first defendant liable to the plaintiffs in contract.
2. The claims in question are Claims I 111 and II(1). In substance, the plaintiffs
have alleged, and they rely on, each of two design faults that are central to
each of these contractual claims.
3, The first alleged design fault
The first design fault is alleged to have consisted of the incompatibility of two
features of the design used, namely
(1) the second defendants' design for the capacity of the web-soffit
conjunctions of the deck segments to withstand moments to which they
111 The wording of paragraphs 35.3.1 and 35.4.1 in Claim I is substantially the same as the wording of
paragraphs 49.1 and 49.3.1 in Claim II(1).
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would inevitably be subjected during the launching process as a result of
the offsetting of the temporary bearings from the webs; and
(2) the plaintiffs' drawings reflecting a design that, by offsetting the vertical
lines through the centre of each temporary bearing from the vertical line
through the bottom of the nearest web, would inevitably subject the web
soffit conjunctions to moments that they had not been designed to be
strong enough to withstand.
4. The second alleged design fault
The second design fault is alleged to have consisted of the second defendants'
having designed the bottom slab of the deck segments, and in particular the
reinforcing steel that gave it strength, with a degree of strength
(1) that was insufficient to enable the bottom slab to withstand the forces towhich it would be subjected during launching in accordance with the
incremental launching method, and
(2) that would in any event have been insufficient for that purpose, even if the
first design fault had not been present (i.e. even if the design reflected in
the plaintiffs' drawings had located the temporary bearings vertically below
the webs).
5. The causes of action in Claim 1
(1) The plaintiffs' contractual cause of action in Claim I, arising out of the first
alleged design fault is based on allegations to the effect that
(a) the second defendants' gave their approval of the plaintiffs' plans
despite the first alleged design fault which, if implemented, was bound
to result in the collapse of the bridge during the launching of segments
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of the bridge; 112
(b) the second defendants, when giving their approval to the plaintiffs'
plans, acted in their capacity as agents for the first defendant,
appointed in terms of the consultancy agreement;
(c) the second defendants' approval (given on behalf of the first
defendant) resulted in the collapse of the partly constructed bridge and
amounted to a circumstance contemplated by the building contract,
that obliged the first defendant to concede the plaintiffs' contractual
entitlement to
(i) an extension of time in terms of GCC 45(2) and (3)(a) or (c); and
(ii) payment of provisional and general costs by the first defendant in
terms of GCC 45(4).
(2) The plaintiffs' contractual cause of action in Claim I, arising out of the
second alleged design fault is based on allegations to the effect that
(a) even in the absence of the first alleged design fault (i.e. if the
temporary bearings had not been offset from the webs), the second
defendants' design for the strength of the lower slab (or 'soffit') of the
segments of the bridge deck, and in particular for the reinforcing steel
to be incorporated in the lower slab, was such that, if implemented, it
was bound to result in the collapse of the bridge during the launching
of segments of the bridge; 113
(b) the second defendants, when requiring the plaintiffs to build the bridge
112 Para's 35.3.1 and 35.4.1, at p 51.
113 Para's 35.3.2 and 35.4.2, at pp 51 and 52; read with para 23.1, at pp 43 to 44.
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in accordance with the second alleged design fault, acted in their
capacity as agents for the first defendant, appointed in terms of the
consultancy agreement;
(c) the second defendants' instruction (given on behalf of the first
defendant) requiring the plaintiffs to build the bridge in accordance
with the second alleged design fault, when implemented by the
plaintiffs, resulted in the collapse of the partly constructed bridge and
amounted to a circumstance contemplated by the building contract,
that obliged the first defendant to concede the plaintiffs' contractual
entitlement to
(i) an extension of time in terms of GCC 45(2) and (3)(a) or (c); and
(ii) payment of provisional and general costs by the first defendant in
terms of GCC 45(4).
6. The causes of action in Claim II(1)
(1) The plaintiffs' contractual cause of action in Claim II(1), arising out of the
first alleged design fault, like Claim I, is based on allegations to the effect
that
(a) the second defendants' gave their approval of the plaintiffs' plans
despite the first alleged design fault which, if implemented, was bound
to result in the collapse of the bridge during the launching of segments
of the bridge;
(b) the second defendants' approval amounted to
'the design, specification or instruction of the Engineer'
within the meaning of GCC 35(2)(j);
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(c) such 'design, specification or instruction' of the second defendants
caused the collapse of the partly constructed bridge which amounted
to
'damage or physical loss or any other loss'
within the meaning of the introductory words in GCC 35(2);
(d) the collapse of the bridge as a result of this cause was accordingly the
materialization of an 'excepted risk' as defined in GCC 35(2);
(e) the materialization of the excepted risk caused
'damage or physical loss ... to the Works'
within the meaning of GCC 35(1)(c). and the second defendants
ordered the plaintiffs to repair it and make it good;
(f) the first defendant was accordingly obliged by the terms of GCC
35(1)(c) to pay the plaintiffs the 'Cost', as defined in GCC 1(1)(h) and
GCC 40. of repairing and making good the damage and physical loss
to the works.
(2) The plaintiffs' contractual cause of action in Claim II(1). arising out of the
second alleged design fault is based on allegations to the effect that
(a) even in the absence of the first alleged design fault (i.e. if the
temporary bearings had not been offset from the webs). the second
defendants' design for the strength of the lower slab (or 'soffit') of the
segments of the bridge deck, and in particular for the reinforcing steel
to be incorporated in the lower slab, was such that, if implemented, it
was bound to result in the collapse of the bridge during the launching
of segments of the bridge ('the second design fault');
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(b) the second defendants required the plaintiffs to build the bridge in
accordance with the second design fault, which accordingly
constituted a
'design, specification or instruction of the Engineer'
within the meaning of GCC 35(2)(j);
(c) such 'design, specification or instruction' of the second defendants
caused the collapse of the partly constructed bridge which amounted
to -
'damage or physical loss or any other loss'
within the meaning of the introductory words in GCC 35(2);
(d) the collapse of the bridge as a result of this cause was accordingly the
materialization of an 'excepted risk' as defined in GCC 35(2);
(e) the materialization of the excepted risk caused
'damage or physical loss ... to the Works'
within the meaning of GCC 35(1)(c), and the second defendants
ordered the plaintiffs to repair it and make it good;
(f) the first defendant was accordingly obliged by the terms of GCC
35(1)(c) to pay the plaintiffs the 'Cost', as defined in GCC 1(1)(h) and
GCC 40, of repairing and making good the damage and physical loss
to the works.
B The four claims in delict based on paragraph 49
7. The plaintiffs have made four claims in delict 114 Two of such claims have
114 Claims III(1) and (2) and Claims V(1) and (2).
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been made, in the alternative, against the first defendant; and two, 115 also in
the alternative, against the second defendants. In all four of the claims in
delict, paragraphs 49.1 (read with 49.3.1 and 23.1) and 49.2 (read with 49.3.2
and 23.1) feature.
8. In essence, all four claims in delict are based on the two design faults alleged
in the contractual claims already summarized. In Claims V(1) and (2), the
plaintiffs have alleged that the second defendants committed the delicts. In
Claims III(1) and (2), the plaintiffs again rely on the two delicts alleged to have
been committed by the second defendants, and they have added further
allegations to support the conclusion that the first defendant is vicariously liable
for each of the two delicts alleged to have been committed by the second
.defendants.
9. The delicts alleged to have been committed by the second defendants
(1) The essence of the plaintiffs' allegations is that the second defendants are
said to have owed the plaintiffs two legal duties, both amounting to duties
of care (i.e. duties not to act wrongfully and negligently). These legal
duties are alleged to have arisen out of the relationship between the
plaintiffs, the first defendant and the second defendants.
(2) The relationship had a contractual component consisting of the
consultancy agreement between the first and second defendants and the
building contract between the first defendant and the plaintiffs. There was
no contractual link between the plaintiffs and the second defendants.
(3) It is the plaintiffs' case that because the building contract constituted the
115 Claims V(1) and (2).
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second defendants the agents of the first defendant for certain purposes,
and because the same contract gave the second defendants certain
powers of control over the plaintiffs, the second defendants became bound
to the plaintiffs by two legal duties, not derived from contract; being
(a) a duty to perform their (the second defendants') duties arising from the
contractual obligations between them and the first defendant, with the
care, skill and diligence of the reasonable engineer in their position
('the first alleged legal duty'); and
(b) a duty to refrain from making misstatements to the plaintiffs that would
not be made by such a reasonable engineer ('the second alleged legal
duty').
(4) The first delict alleged against the second defendants
The plaintiffs allege that the second defendants breached the first alleged
legal duty in each of two ways, both deriving from the allegations in
paragraph 49. They say that the second defendants acted wrongfully,
negligently and in breach of the plaintiffs' rights when
(a) the second defendants approved the plaintiffs' drawings for the
temporary works despite the incompatibility between
(i) the proposal in the plaintiffs' drawings to offset the vertical centre
lines of the temporary bearings from the vertical centre lines of the
bottoms of the webs; and
(ii) the second defendants' design for the strength of the web-soffit
conjunction, which was insufficient to withstand the forces to
which it would be subject during the launching of the deck
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segments as a result of the offsetting of the temporary bearings
('the first design fault'); and
(b) the second defendants designed, and required the plaintiffs to build,
the bottom slabs of the deck segments with a degree of strength (and
in particular the strength derived from the steel reinforcing) that was
inadequate to withstand the forces to which the bottom slabs would be
subject during the launching of the deck segments, even if the first
design fault had not been made and if the centres of the temporary
bearings had been placed vertically below the centres of the bottoms
of the webs ('the second design fault').
(5) The second delict alleged aqainst the second defendants
The plaintiffs allege, in the alternative, that the second defendants
negligently and wrongfully breached the second alleged legal duty by
making a misstatement that was relied upon by the plaintiffs and that
caused the plaintiffs to suffer damages. The substance of the
misstatement alleged and relied upon by the plaintiffs is simply that the
second defendants, by approving the plaintiffs' drawings for the temporary
works despite the first design fault referred to above (the incompatibility
of the plaintiffs' drawings and the second defendants' design for strength
of the web-soffit conjunction) made a misstatement.
(6) The alleged vicarious liability of the first defendant for the first and second
delicts alleged against the second defendants
(a) In Claims III(1) and (2), the plaintiffs base their allegation of vicarious
liability on the part of the first defendant for delicts alleged to have
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been committed by the second defendants against the plaintiffs, on
allegations
(i) that the first defendant had specifically authorized the second
defendants to perform the contractual obligations that had
resulted in the imposition on the second defendants of extra
contractual legal duties owed to the plaintiffs; 116 and
(ii) that the first defendant had authorized the second defendants to
obtain a result, namely the design and construction of the Injaka
bridge, and that the second defendants, in performing the
contractual obligations that had resulted in the imposition on them
of extra-contractual legal duties owed to the plaintiffs, had been
seeking to obtain that result. 117
(b) However, in Claim III(1) the plaintiffs have not merely alleged that the
first defendant is vicariously liable for the delicts for which the second
defendants are alleged, in Claim V(1), to be liable to them. In Claims
III(1) and V(1) respectively, the plaintiffs have chosen different words
in which to set out the basis of the legal duties alleged to be owed to
them by the second defendants, and also in which to allege the breach
of such duties by the second defendants.
(c) Nevertheless, in Claim III(1), the plaintiffs have alleged that the
second defendants' performance of such of their contractual
obligations as had imposed on them further, extra-contractual, legal
116 Para's 66.1 and 67, at p 66, relating to Claim III(1); and para's 71.1 and 72, at p 69, relating to Claim III(2).
117 Para's 66.2 and 67, relating to Claim III(1); and para's 71.2 and 72 relating to Claim III(2).
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duties owed to the plaintiffs, had been -
'wrongful and negligent for the reasons set forth mutatis mutandis in paragraph 49 above.' 118
This is the nub of Claim III(1). It renders the basis of the second
defendants' alleged delictual liability, for which the first defendant is
alleged in Claim III(1) to be vicariously liable, indistinguishable in
substance from the basis of the second defendants' alleged delictual
liability as formulated in Claim V(1), 119 regardless of the plaintiffs'
different choice of words. Apart from the fact that the exception to
Claim III(1) raises the question of the alleged vicarious liability of the
first defendant, the legal questions surrounding Claim III(1) in these
proceedings are the same as those surrounding Claim V(1).
(d) Claim III(2) resembles Claim V(2) closely. The wording of paragraphs
68 to 70 in Claim III(2) is identical to the wording in paragraphs 91 to
93 in Claim V(2). Apart from the fact that the exception to Claim III(2)
raises the additional question of the alleged vicarious liability of the
first defendant, the legal questions surrounding Claim III(2) in these
proceedings are the same as those surrounding Claim V(2).
118 Para 66.3.
119 See especially para 88 which, though using different (and more numerous) words than para 66.3, is
essentially the same as para 66.3. The substance of both is that the second defendants acted wrongfully and
negligently towards the plaintiffs (i) by wrongly approving the plaintiffs' incompatible drawings that resulted in the
first design fault, and (ii) by themselves introducing the second design fault, viz, a design for an inadequatelyreinforced bottom slab for the deck segments.
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Further arrangement of iudgment
[118]
1.
I intend to deal with the following matters:
I shall summarize the general allegations that the plaintiffs have made in their
particulars of claim giving the background against which all of their claims,
including the claims in delict against which the exceptions have been raised.
2. Insofar as the plaintiffs' contractual claims are necessary to an understanding
of the exceptions to the claims in delict, and insofar as the contractual claims
have not already been dealt with in the course of establishing the meaning of
paragraph 49 of the particulars of claim, I shall outline the contractual claims.
3. Then I shall examine the second defendants' exceptions to the claims in delict
made against them. The plaintiffs have alleged that the second defendants are
the primary wrongdoers. If there is no substance in the allegations made
against them, there can be no question of the alleged vicarious liability of the
first defendant
4. Even if it emerges that there is no case in delict against the second defendants,
I shall next assume that there is such a case, and go on to examine the first
defendant's exceptions to the claims in delict made against him and, in
particular, the question of the allegations to support the plaintiffs' conclusion of
vicarious liability on his part. .
5. Finally, I shall deal with the second defendants' application in terms of Rule 30
to strike out matter from the particulars of claim on the basis that it renders the
particulars an irregular proceeding.
[119] In the course of dealing with the exceptions, I shall deal with the following
questions, though not necessarily in the same order.
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1. Have the plaintiffs made allegations which, if proved, will establish patrimonial
loss (damnum) recoverable in delict? If not, the exceptions must succeed.
2. If so, is the patrimonial loss that they allege 'pure economic loss'?
3. If, or to the extent that, their allegations relate to losses that are not pure
economic losses, can any of the exceptions succeed? This question involves
deciding to what extent the present case, if it is a case in which the plaintiffs
have successfully alleged that the defendants wrongfully caused them to suffer
losses resulting from physical injury to persons or physical damage to the
plaintiffs' property, is governed by the decision in Lillicrap.
4. If, or to the extent that, the plaintiffs' allegations relate to losses that are purely
economic
(1) have the plaintiffs sufficiently alleged that the second defendants were
under one or more of the following legal duties to the plaintiffs, namely
duties to take reasonable care
(a) to provide the plaintiffs with a design in terms of which the permanent
works could successfully be built by the incremental launching
method?
(b) to ensure that they did not approve any drawing for the temporary
works, prepared by the plaintiffs and submitted by them to the second
defendants for approval in terms of the building contract, that was not
compatible with the second defendants' own design for the permanent
works?
(c) to refrain from making any misstatement to the effect that any drawing
submitted to them by the plaintiffs for approval in terms of the building
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contract was compatible with the second defendants' own design for
the permanent works, if it was not in fact so compatible?
(2) must the exceptions succeed to the extent that any of such allegations
may not have been made, or may only have been made in a manner that
is vague and embarrassing?
5. If, or to the extent that, the plaintiffs are claiming only for pure economic loss,
and if they have made allegations which, if proved, will establish the existence
of a legal duty owed to them by the second defendants, and the wrongful
breach of such a duty
(1) does the decision in Lillicrap apply to the circumstances alleged?
(2) if so, does it preclude the claims in delict that the plaintiffs have made?
(3) if so, must the exceptions of one or both of the defendants succeed? 6. If the exceptions that the plaintiffs have failed to set out a cause of action,
taken by either or both of the defendants, must fail, must the exception that
some or all of the plaintiffs' allegations are vague and embarrassing
nevertheless succeed?
7. If, or to the extent that, the second defendants' exceptions must fail, should the
first defendant's exceptions
(1) that the plaintiffs' averments are insufficient to sustain a case of vicarious
liability; and
(2) that the plaintiffs' averments apparently directed to establishing vicarious
liability are vague and embarrassing
nevertheless succeed?
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The background to the plaintiffs' claims in delict
Claim 1
[120] The plaintiffs' first claim is against the first defendant alone. It is a contractual
claim based on the building contract. The relief sought is an extension of time, and
additional payments in respect of preliminary and general allowances, said to be
justified by the extension of time claimed. This claim is based on the provisions of
clause 45 120 of the General Conditions of Contract ('GCC 45').
120 GCC 45 (p 202):
'Time for completion
45 (1) Subject to any requirement in the Specifications as to the completion of any portion of the
Permanent Works before completion of the whole, the whole of the Works shall be completed
within the time stated in the Appendix calculated from the Commencement Date. Extension of time for completion
(2) If circumstances of any kind whatsoever which may occur be such as fairly to entitle the
Contractor to an extension of time for the completion of the Works or any portion thereof, the
Engineer shall grant the Contractor, on a claim in accordance with Clause 51, such extension
of time as is appropriate. Such extension of time shall take into account any special non-
working days and all relevant circumstances, including concurrent delays or savings of time
which might apply in respect of such claim;
Provided that, in respect of such claim, the period of 56 days referred to in Clauses 51(5) and
51(6) shall be reduced to 28 days.'
[Note: The period is one within which the Engineer must give a ruling.]
'Some reasons for extensions of time (3) Without limiting the generality of Sub-Clause (2), the circumstances referred to in that Sub
Clause include
(a) the amount and nature of additional work, (b) ...,
(c) any failure or delay on the part of the Employer or his agents, employees or other
contractors (not being employed by the Contractor) in the due performance of any
obligations as are reasonably necessary to enable the Works to proceed, (d) ..., (e) ..., and (f) ...
Relevant adjustments to P & G allowances
(4) If an extension of time is granted, the Contractor shall be paid such additional time-related Preliminary and General allowances as are appropriate having regard to any other
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GCC 45 must be read with GCC 51, 121
compensation which may already have been granted in respect of the circumstances
concerned.'
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121 GCC 51 (at p 205) provides: 'Claims procedure 51 (1) The following provisions shall apply to any claim by the Contractor in terms of the Contract for
an extension of time in terms of Clause 45 for the completion of the Permanent Works, or (in
terms of any Clause making reference to Clause 51) for additional payment or compensation:
(a) The Contractor shall, within 28 days after the circumstance, event, act or omission giving
rise to such a claim has arisen or occurred, deliver to the Engineer a written claim,
referring to this clause and setting out
(i) the particulars of the circumstance, event, act or omission giving rise to the
claim concerned,
(ii) the provisions of the Contract on which he relies in making the claim,
(iii) the length of the extension of time, if any, claimed and the basis of .
calculation thereof, and (iv) the amount of money, if any, claimed and the basis of calculation thereof.
(b) If, by reason of the nature and circumstances of the claim, the Contractor cannot
reasonably comply with all or any of the provisions of paragraph (a) within the said
period of 28 days, he shall
(i) within the said period notify the Engineer in writing of his intention to make
the claim and comply with such of the requirements of paragraph (a) as he
reasonably can,
(ii) deliver to the Engineer in writing such additional information as the Engineer
shall, in writing, reasonably require, and
(iii) comply as soon as is reasonably practicable with such of the requirements
of paragraph (a) as have not been complied with.
(c) If the events or circumstances relating to the claims are of an ongoing nature, the
Contractor shall, each month, deliver to the Engineer in writing updated particulars
required in terms of paragraphs (a) and (b).
Extended period for claims
(2) If, in respect of any claim, the Contractor did not comply with the provisions of Sub-Clause (1)
because he was not and could not reasonably have been aware of the implications of the facts
or circumstances concerned, the period of 28 days referred to in Sub-Clause (1) shall
commence to run from the date when he should reasonably have become so aware.
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Records of facts and circumstances (3) In order that the extent and validity of claims in terms of this Clause may be properly assessed when they are submitted, the following provisions shall apply:
(a) All facts and circumstances relating to the claims shall be investigated as and when they occur or arise. For this purpose the Contractor shall deliver to the Engineer records, in a form approved by the Engineer, of all the facts and circumstances which the Contractor considers relevant and wishes to rely upon in support of his claims, including details of all Constructional Plant, labour and materials relevant to each claim. Such records shall be delivered promptly after the occurrence of the eventgiving rise to the claim concerned.
(b) The Engineer may record such facts and circumstances, additional to those recorded by the Contractor, as he considers relevant and the Contractor shall, for this purpose, supply the Engineer with all the information which he may require.
(c) The Engineer and the Contractor shall, at the time of making the record in terms of paragraphs (a) and (b), set out in writing, signed by each of them and delivered to the other of them, their respective agreement or disagreement as to the correctness of the matters recorded.
(d) Each record of an agreed fact in terms of paragraph (c) shall in any dispute be prima facie evidence of the fact concerned. (e) For the purpose of this Clause, information arising from a technical investigation or analysis undertaken after the events giving rise to the claim have occurred shall not be regarded as facts or circumstances required to be recorded in terms of this Clause.
(f) The Employer, the Engineer and the Contractor shall not in any proceedings in accordance with Clause 61 be entitled to give or lead evidence of or rely on any fact or certificate not recorded in terms of this Clause unless the other party to the dispute is not prejudiced by such non-recording of the facts.'
[Note: Clause 61 provides procedures for the settlement of disputes arising from rulings given or deemed to have been given by the Engineer, and of other disputes not so arising.)
'Contractor's failure to comply (4) If, in respect of any claim to which this Clause refers, the Contractor shall fail to comply with the provisions of Sub-Clause (1), as read with Sub-Clause (2), he shall have no further right to make the claim concerned.
Engineer's ruling (5) Unless otherwise provided in the Contract, the Engineer shall, within 56 days after the Contractor has complied with his obligations in terms of Sub-Clause (1) as read with Sub Clause (2) and paragraphs (a), (b) and (c) of Sub-Clause (3), deliver to the Contractor and the
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dealing with the procedure to be followed by the contractor in making claims in terms
of the contract.
[121] In terms of the building contract, the Injaka dam bridge was to have been
completed by 10th November 1998. 122
Employer his written ruling on the claim (referring specifically to this Clause), and the amount, if
any, thereof allowed by the Engineer shall be included to the credit of the Contractor in the next
payment certificate:
Provided that
(a) the said period of 56 days may be extended if so agreed between the Contractor and
the Engineer, and
(b) if, before the Engineer's ruling on the whole claim, any amount thereof shall have been
established to his satisfaction, that amount shall be included to the credit of the
Contractor in the next payment certificate.
Engineer's failure to rule (6) If the Engineer fails to give his ruling within the period referred to in Sub-Clause (5), he shall be deemed to have given a ruling dismissing the claim.'
122 In terms of GCC 1(1 )(c), (Particulars of claim, p 178), the 'Commencement Date' was defined as –
'the date of delivery to the Contractor of a written notice from the Employer or the Engineer
requiring him, in terms of Clause 12, to commence the execution of the Works.'
In terms of GCC 12, (Particulars of claim, p 186), the 'Commencement Date' was not to be later than
28 days after the date of delivery of the Employer's 'Letter of Acceptance' of the 'Tender' of the 'Contractor' (unless otherwise agreed), and the 'Contractor' was obliged to commence execution of the 'Works' within
the number of days stated by him in the 'Appendix' to his 'Tender', unless a later date was specified in the
written notice to the 'Contractor' establishing the 'Commencement Date'. In the Appendix to their Tender, (Particulars of claim, p 306), the plaintiffs specified that the Works
would be commenced '28 days after the Commencement Date'. What was plainly envisaged was that a
Commencement Date would be fixed (either by the notice contemplated by GCC 1(1)( c) or by the lapse of
28 days from delivery of the Letter of Acceptance in terms of GCC 12) and that the plaintiffs would make a
start on the Works not more than 28 days after the Commencement Date so fixed.
The time for completion that the plaintiffs offered (Particulars of claim, p 307) was '15 months
including the contractor's holidays during December and January'. This period was to run from the Commencement Date, as defined, (and not from the date of commencement of the execution of the
Works).
The first defendant's Letter of Acceptance is dated 30th July 1997 (Particulars of claim, p 7, para
7; and p 170), and it was evidently faxed to, and received by, the plaintiffs on that date. It included the
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[122] The plaintiffs allege that, on 6th July 1998, at about 13h15, during the launching
of segment 6 of the bridge deck, the partially built bridge collapsed in the manner
already described. 123 The second defendants had thereupon issued an instruction
suspending further work on the bridge, and the plaintiffs had obeyed the instruction. 124
[123] In terms of a letter dated 25th August 1998, sent by the second defendants to
the plaintiffs, it had been agreed that the plaintiffs should demolish and remove the
elements of the bridge that had been damaged or destroyed in the collapse, and they
had done so. 125
[124] The plaintiffs aver that they had accordingly complied with their obligations in
following
'This letter of acceptance constitutes a binding contract but no delivery should be effected
until an order from this Department, which inter alia indicates delivery instructions, has
been received. If the order is not received within three weeks from date hereof enquiries
must be made to A. Moore ...'
The plaintiffs allege that such order was 'duly received', but they have not alleged the date of
receipt nor what, if anything, the order stipulated in regard to the Commencement Date.
It would therefore appear that, in this instance, the Commencement Date was not necessarily to be a
maximum of 28 days after the date of delivery of the first defendant's Letter of Acceptance, and that it was
to be fixed in accordance with the order that the first defendant had indicated would follow about
three weeks, or more, after the date of delivery of the Letter of Acceptance.
The plaintiffs have alleged that the Commencement Date was fixed by agreement as 11 August
1997 (Particulars of claim, p 44, para 24.1). They have also alleged, in para 14.1 of the particulars of
claim (Pleadings p 40) '14.1 The plaintiff commenced the execution of the works during or about August 1997
...'
The contract period of 15 months calculated from the Commencement Date of 11 August 1997
was due to end on 10 November 1998. The plaintiffs have indeed alleged that the completion date
originally agreed upon was 10 November 1998 (Particulars of claim, p 45, para 24.5).
123 Particulars of claim, p 42, para 19.
124 Particulars of claim, p 42, para 20.
125 Particulars of claim, p 43, para 21.1, and p 581.
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terms of the Building Contract. 126
[125] The plaintiffs allege further that the second defendants had designed 'a
replacement bridge ("the new Injaka bridge")' in which they -
'effected material modifications, inter alia, to the design of the reinforcement in the
bottom of the concrete deck and to the placement of the temporary bearings
under the said slab.' 127
[126] In terms of a letter dated 3rd March 1999, the second defendants had instructed
the plaintiffs to construct the new Injaka bridge, and the plaintiffs had duly done so. 128
[127] Nine days after the collapse of the bridge on 6th July 1998, and on 15th July
1998, the plaintiffs had written to the second defendants claiming an extension of time
in terms of GCC 45(2) and 51(1). 129 For reasons set out in the letter, it had not then
been possible to assess the additional time that would be required to complete the
construction of the bridge.
[128] In a letter dated 5th October 1998 addressed to the second defendants, the
plaintiffs had alleged that disagreement had arisen over the question whether or not the
failure of the bridge had been caused by inadequate design of permanent works (an
'excepted risk' for which the plaintiffs were not responsible). The plaintiffs had called
upon the second defendants in terms of GCC 60 to consider the disagreement and to
give a ruling on it (by implication, within the 14 days allowed by GCC 60(2), failing which
the second defendants would be deemed to have dismissed the plaintiffs'
126 Particulars of claim, p 43, para 22.
127 Particulars of claim, pp 43 - 44, para 23.
128 Particulars of claim, pp 47 - 48, para 29; p 56, para 44; and p 588.
129 Particulars of claim, p 45, para 25, and p 584.
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contentions). 130
[129] The second defendants, in a letter dated 19th October 1998, had informed the
plaintiffs that they did not consider it appropriate to provide a ruling on the disagreement
about the cause of the collapse of the bridge until after the findings of the official enquiry
into that question had been made public. 131
[130] The plaintiffs, in a letter dated 27th November 1998, had recorded that they
understood that their claim for a ruling on the disagreement by the second defendants
was 'premature'. 132 The implication of this letter appears to be that the plaintiffs had
then taken the position to be that the omission by the second defendants to provide a
ruling within the 14 days allowed by GCC 60(2) would not result in the second
defendants' being deemed to have dismissed the plaintiffs' contentions.
[131] The plaintiffs have also referred to correspondence on the question of their
130 Particulars of claim, p 46, para 26.1; and p 599. GCC 60 (at p 216) provides:
'Notice of disagreement 60 (1) In respect of any matter not required to be dealt with in terms of Clauses 51 or 61(6), the
Contractor shall have the right by written notice to the Engineer to require him to consider any
disagreement which he raises with the Engineer provided that the said written notice shall be given
within 21 days after the cause of disagreement has arisen.'
[Note: Clause 51 relates to claims for additional time or additional payment; and Clause
61(6) to disputes to be determined by arbitration or by litigation.]
'Engineer to rule on disagreements
(2) The Engineer shall give a ruling on the disagreement in writing to the Employer and the
Contractor, referring specifically to this Clause, which ruling he may give at any time after his
receipt of the written notice referred to in Sub-Clause (1), but he shall do so by not later than
14 days after his receipt of a written request from the Contractor requiring him to do so, failing
which he shall be deemed to have given a ruling dismissing all the Contractor's contentions.'
131 Particulars of claim, p 46, para 26; and p 585.
132 Particulars of claim, pp 55 - 56, para 43, and p 605.
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claim for an extension of time. It includes a letter dated 3rd December 1998, addressed
to the second defendants, in which the plaintiffs had specified their claim for an
extension as being for.298 days and, alleging that they had duly complied with GCC45
and 51 as far as was necessary, they had called for a decision by the second
respondents. 133 They had enclosed a
'proposed programme for the reconstruction of the bridge ancillary works.'
This programme presumably related to the work involved in reconstructing, in
accordance with the new design, both the works that had failed and the works that
had been damaged, on 6th July 1998. [132] As already mentioned, the second defendants, in a letter dated 3rd March 1999
concerning 'Tender No WF 6299 ... Reconstruction of Superstructure to Bridge on Road
P 57-3', instructed the plaintiffs to proceed with the work, and called for
'an adjusted works programme.' 134
[133] In a letter dated 8th June 1999, addressed to the plaintiffs, the second
defendants had approved, in terms of GCC 15, the new works programme submitted
by the plaintiffs. 135
[134] In a letter dated 27th August 1999, responding to the plaintiffs' request for
payment of "reconstruction costs", the second defendants had reaffirmed their view that
a ruling on payment of such costs to the plaintiffs could not be made until a decision had
been taken on the question of responsibility for the collapse of the bridge. 136
[135] In a letter dated 30th January 2001, addressed to the plaintiffs, the second
133 Particulars of claim, pp 46 - 47, para's 27 and 28; and pp 586 - 587.
134 Particulars of claim, pp 47 - 48, para 29; and p 588. 135 Particulars of claim, p 56, para 45; and p 606.
136 Particulars of claim, p 48, para 30; and p 589.
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defendants had recorded their view that the official enquiry into the collapse of the
bridge would continue until at least June 2001, and also that they had decided to issue
a ruling based upon the evidence that had already been led at the enquiry. Their ruling
had been in the following terms:
'From the inquiry there are two possible reasons for the failure of the bridge. The
first is that the steel launching nose failed. The second is that the temporary
bearings on pier 2 penetrated the soffit of the superstructure. It is the Engineer's
opinion that both of these reasons form part of the design and implementation of
the temporary works.
In terms of clause 6(1) 137 of the General Conditions of Contract and
clause 2.2.4 138 of the Special Provisions of the Contract, the Contractor is responsible for the design and implementation of the temporary
works.
Therefore in terms of clause 60(2) 139 of the General Conditions of
Contract your claim for recovery of costs based upon the contentions that the
cause of the failure is an excepted risk under section 35(2)(j) 140 is rejected.
With reference to your claim for an extension of time. Oh the basis of
137 Clause 6(1) of the GCC, at p 183, reads:
'Extent of Contractor's obligations
6 (1) The Contractor shall, save in so far as it is legally or physically impossible,
(a) design (to the extent provided in the Contract), execute and complete the Works and
remedy any defects therein in accordance with the provisions of the Contract, and
(b) provide all superintendence, labour, materials, Constructional Plant, Temporary Works,
including the design thereof, all requisite transport and all other things, whether of a
temporary or permanent nature, required in and for such design, execution and completion of the
Works and for the remedying of any defects, so far as the necessity for providing the
same is specified in or reasonably to be inferred from the Contract.'
138 Project Specification, Clause 2.2.4 Bridge work; Particulars of claim, 412 - 413. The last paragraph of Clause 2.2.4 reads:
'The contractor shall accept full responsibility for the design of all temporary work required for the
construction of the bridge, and shall submit full details thereof to the engineer for his review and
acceptance.'
139 Particulars of claim, p 216. Quoted above.
140 Particulars of claim, p 195. So far as relevant, Clause 35(2)(j) is Quoted below.
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your responsibility for the design and implementation of the temporary work,
in terms of clause 51(5) 141 of the General Conditions of Contract, your claim
for an extension of time is rejected.' 142.
[136] The plaintiffs have alleged that the second defendant had also applied a
reduced Contract Price Adjustment Factor ('CPAF') in respect of payment certificates
issued for the period after the due completion date. 143
[137] The second defendants' ruling rejecting the plaintiffs' claim for an extension of
141 Pleadings, p 206. Quoted above.
142 Particulars of claim, pp 48 - 49, para's 31 and 32.1; p 57, para 47; and pp 590 - 591.
143 Particulars of claim, p 49, para 32.2. At p 18, para 10.27.2, the plaintiffs alleged that, in terms of GCC 49(2) and (3) (at p 204), if an extension of time were to be granted, a Contract Price
Adjustment Factor had also to be applied. GCC 49(2) and (3) (at p 204) provide:
'Application of Contract Price Adjustment Factor
49(2) The value of certificates issued in terms of Clause 52(1) (excluding the value of those materials
referred to in Sub-Clause (3)) shall be increased or decreased by applying a "Contract Price
Adjustment Factor" calculated according to the formula and the conditions set out in the Contract
Price Adjustment Schedule.
Variation in cost of special materials
49(3) Price adjustments for variations in the costs of special materials specified in the Appendix shall
be made in the manner set out in the Contract Price Adjustment Schedule.'
The Contract Price Adjustment Schedule, containing the formula that determines the CPA Factor, is
attached to the particulars of claim at pp 221 - 222. Clause 3 provides:
'Reduction of CPAF after Due Completion Date
3. Save only for additional work or variations ordered to be carried out after the Due Completion Date,
the Contract Price Adjustment Factor to be applied to certificates relating to work done or
materials supplied after the Due Completion Date shall be half the factor calculated by inserting
in the formula referred to in Clause 1 of this Schedule the indices Lt, Pt, Mt and Ft applicable at
the Due Completion Date.'
In short, no increases in the CPAF are permitted in respect of payments for work and materials
supplied after the Due Completion Date, and such payments are to be calculated using a CPAF of only
50% of the CPAF calculated as at the Due Completion Date (except for additional work or variations
ordered to be carried out after the Due Completion Date.)
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time had been a ruling given by the Engineer in terms of GCC 51. The plaintiffs had
therefore had the right in terms of GCC 61(1)(a) to dispute the ruling by means of the
procedure provided by GCC 61. The plaintiffs had accordingly given a 'Dispute Notice'
dated 5th March 1998, within the 42-day period allowed by GCC 61(1)(a). 144
[138] Three years later, on or about 15th March 2001, a written agreement had been
concluded between the plaintiffs and the first defendant, so the plaintiffs have alleged,
in terms of which they had dispensed with the further dispute-resolution procedures
provided by GCC 61(1)(c) and (d) and 61(2).145 The plaintiffs had been required to
submit to the first defendant, for consideration by his Department, 'a proposal for an
alternative dispute resolution procedure.' 146
[139] The plaintiffs have not alleged that they did submit any such proposal to the first
defendant. However, no point has been made of that fact in these proceedings. The
plaintiffs have simply alleged that by reason of their agreement with the first defendant
concluded on 15th March 2001 (to dispense with both the requirement of a further ruling by the Engineer on his rejection of the plaintiffs' claim for an extension of time, and the
requirement of a reference of the dispute to mediation), their claim has become one that
can be adjudicated by the court in terms of GCC 61(4). 147
144 Particulars of claim, p 49, para 33; p 61, para 51; pp 216 - 217; and p 592.
145 These were essentially a further ruling by the Engineer after hearing both the Employer and the Contractor on the question of the validity of his disputed ruling, and, if the further ruling was
also disputed, a reference of the dispute to mediation.
146 Particulars of claim, p 50, para 34; p 61, para 51.3; pp 216 - 217; and pp 595 - 596.
147 GCC 61(4) (at p 219) provides: 'Reference to Court
61 (4) If the Contract does not provide for the determination of disputes by arbitration and if a dispute
is still unresolved as provided in Sub-Clause (2)(9) or the dispute is one described in Sub Clause (6), the dispute shall be determined by Court proceedings.'
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[140] The plaintiffs aver that, in the premises, they have complied with their
obligations in terms of the relevant provisions of the GCC and have completed the new
Injaka bridge (as redesigned by the second defendants after the failure of the initial
design). 148
[141] In their first contractual claim, ('Claim I'), the plaintiffs aver that they are entitled
to orders against the first defendant alone for:
1. an extension of time as claimed in their letter dated 3 December 1998, being
essentially
(1) '298 working days including the 1999/2000 Xmas holiday';
(2) any delays beyond certain assumptions specified in the letter; 149
2. further extensions of time for inclement weather, bringing the total claimed up
to 14,68 months; 150
3. payment of R7,983,669.00, as additional preliminary and general allowances.151
Claim II
[142] Claim II is also a contractual claim based on the building contract and made
against the first defendant alone. The claim has two parts: Claim II(1) and Claim II(2).
(GCC 61(2)(g) deals with a case in which the parties have used mediation proceedings and have not
succeeded in resolving the dispute. GCC 61(6) deals with 'Special Disputes' and is not now relevant.)
148 Particulars of claim, p 52, para 36.1.
149 Particulars of claim, p 52, para 36.2; pp 586 - 7.
150 Particulars of claim, p 52, para 36.2; p 81, prayer 1.2.1; pp 85 - 86, Schedule X1.
151 Particulars of claim, p 52, para 36.3; p 82, prayer 1.2.2; pp 87 - 88, Schedule X2.
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Claim II(1)
[143] In Claim II(1), which is itself divided into two parts, Part A and Part B, the
plaintiffs claim a total of R28,052,267.22 (excluding VAT), so far as Claim II(1) may not
be satisfied in terms of Claim I.
[144] The essence of Claim II(1) is that, in terms of the building contract, once the
building site had been handed over to the plaintiffs, they were to be responsible for all
risks to the works other than certain 'excepted risks'; that the excepted risks had
included
'the design, specification or instruction of the Engineer, Employer or any of
their employees or agents ...'; 152
that the collapse of the partially constructed bridge on 6th July 1998 had not been the
result of any risk for which the plaintiffs were responsible and had in fact been the result
of one of the excepted risks for which the plaintiffs were expressly exempted from
responsibility, namely
'the design, specification or instruction of the Engineer';
that the second defendants (as 'the engineer') had ordered the plaintiffs to repair and
make good the damage and physical loss arising from the excepted risk, as they (the
second defendants) had been entitled to do; that the plaintiffs had duly performed the
order, as they had been obliged to do; that the plaintiffs had therefore become entitled
in terms of the building contract to be paid in full for their work in completing the
construction of the re-designed bridge; that the plaintiffs had in fact been paid on a basis
that wrongly assumed that they themselves had been responsible for the collapse of the
partially constructed bridge; and that they were accordingly entitled to payment of the
152 GCC 35(2)(j), at p 195.
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unpaid balance that was payable in terms of the building contract on the basis that the
plaintiffs had not been responsible for the collapse.
[145] The plaintiffs rely particularly on GCC 35(1)(c) and 35(2(j). These provisions
must be read in the context of the Building Contract as a whole, and especially in the
context of certain other provisions of GCC 35. 153
[146] The plaintiffs allege that they
'completed the works including the construction of the new Injaka bridge by the
completion date, having regard for extensions of time noted and allowed
153 GCC 35(1) and (2) (p 195) provide so far as presently relevant: 'Care of the Works 35(1) (a) From the date when the Site is handed over to the Contractor to the date of the issue of a
Certificate of Completion the Contractor shall take full responsibility for the care of the Works
and of all materials on the Site intended for incorporation in the Works;
Provided ...
(b) If any damage or physical loss shall happen to the Works or the said materials, or any part
thereof, from any cause whatsoever (other than the "excepted risks" defined in Sub-Clause
(2)) while the Contractor is responsible for the care thereof, the Contractor shall at his own
cost repair and make good the same so that, at the issue of the Certificate of Completion, the
Works or the portions of the Works to which the Certificate relates shall be in good order and
condition and in conformity with the Contract.
(c) If any damage or physical loss shall be caused to the Works or the said materials arising from
any of the "excepted risks", the Contractor shall, if ordered by the Engineer, repair and make good the
same and be paid the Cost of doing so.
(d) ...
Excepted risks
(2) The "excepted risks" are risks of damage or physical loss or any other loss caused by or arising
directly or indirectly as a result of or as a consequence of
(a) war,... (b) insurrection,... (c) mutiny, ... (d)... (e) ... (f)... (g) ... (h)... (i) ...
(j) the design, specification or instruction of the Engineer, Employer or any of their employees or agents, & defects in the materials supplied by the Employer for incorporation
in the Works, (k) ... (I) ...'
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due to inclement weather.' 154
[147] The plaintiffs claim the 'cost of doing so', as contemplated by GCC 35(1)(c),
such 'cost' being as defined in GCC 1(1)(h).155
154 The 'completion date' referred to is evidently the date indicated in the programmeapproved by the second defendants for the redesigned bridge, with adjustments for days lost through
rain: Particulars of claim, p 57, para 46. It could therefore be the same as the' Due Completion Date' as
defined in GCC 1(1) (k), at p 178:
'Definitions: 1.(1) In the Contract (as hereinafter defined) the following words and expressions shall
have the meanings hereby assigned to them except where the context otherwise requires:
(a) ...
(k) "Due Completion Date" means the date of expiry of the time stated in the Appendix for
completing the execution of the Works, calculated from the Commencement Date and as adjusted by such extensions of time as may be allowed in terms of Clause 45.'
(The definition of 'Commencement Date' has been quoted above. In any event, the plaintiffs have alleged
that the Commencement Date was fixed by agreement as 11 August 1997: Particulars of claim, p 44,
paragraph 24.1).
155 Particulars of claim, pp 57 - 58, para's 48.1 and 48.3; p 60, para 50.1. See also p 178, where GCC 1(1)(h) provides the following definition:
'Definitions: 1.(1) In the Contract (as hereinafter defined) the following words and expressions
shall have the meanings hereby assigned to them except where the context otherwise requires:
(a) ...
(h) "Cost', in relation to any provision of the Contract for payment to the Contractor for any
delay, work, service or supply, means, unless the provision otherwise specifies,
compensation to the Contractor for such delay, work, service or supply concerned
calculated, mutatis mutandis, in terms of Clause 40.'
GCC 40 refers back to GCC 39. GCC 39 and 40(1) (at pp 198 and 199) provide, so far as presently relevant
'Variations:
39 (1) If, at any time before the issue of the Certificate of Completion, the Engineer shall require any
variation of the form, quality or quantity of the Works or any part thereof that may in his opinion
be necessary or for any reason appropriate, he shall have the power to order the Contractor to
do any of the following:
(a) increase of decrease the quantity of any work included in the Contract,
(b) omit any such work,
(c) change the character or quality of any such work,
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[148] The plaintiffs have formulated their claim in two parts, which I refer to
respectively as Claim II(1)(Part A) and Claim II(1) (Part B). At this point, it is convenient
to deal with Part A and Part B separately.
(d) change the levels, lines, position and dimension of any part of the Works, (e) execute additional work of any kind necessary for the completion of the Works, and (f) change the specified or approved sequence or method of construction.
No such variation shall in any way vitiate or invalidate the Contract, but the value (if any) of all such variations shall be taken into account in ascertaining the amount of the Contract Price.
Orders for variations to be in writing (2) No such variation shall be made by the Contractor without an order in writing (herein referred to as a "Variation Order") by the Engineer; Provided that ...
Valuation of variations: 40 (1) The value of all variations ordered by the Engineer in accordance with Clause 39 shall be
calculated by the Engineer, after consultation with the Contractor, in accordance with the following principles:
(a) where work is of a similar character and is executed under similar conditions to work
priced in the Schedule of Quantities, it shall be valued at such rates and prices (including Preliminary and General allowances) contained therein as may be applicable; or
(b) where work is not of a similar character or is not executed under similar conditions, the rates and prices in the Schedule of Quantities shall be used as the basis for valuation as far as may be reasonable; or
(c) where work cannot reasonably be valued in accordance with paragraphs (a) or (b), a fair value shall be determined; or
(d) in respect of additional or substituted work, if none of the above principles are applicable, the work shall be executed on a daywork basis in terms of Sub-Clause (4);
Provided that, failing agreement with the Contractor, the Engineer shall determine the rate or price in accordance with the aforegoing principles, notify the Contractor in writing accordingly and apply the said determination in his certification of amounts payable to the Contractor, without prejudice to the Contractor's right to raise a disagreement in terms of Clause 60.
(2) ... (3)...
Daywork
(4) (a) If work is to be executed on a daywork basis in terms of Sub-Clause (1)(d), the Contractor
shall be paid for such work under the provisions set out in the Daywork Schedule included
in the Tender and at the rates and prices stated therein. (b) ...'
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Claim II(1)(Part A)
[149] Part A of Claim II(1) is for the 'Cost of doing so', properly so called. GCC
35(1)(c) entitles the plaintiffs (on their case as alleged) to the 'Cost' of carrying out the
order of the second defendants (as 'the Engineer') to repair and make good the damage
and physical loss that was caused to the works and the materials on site when the
partially constructed bridge collapsed on 6th July 1998, arising from an 'excepted risk',
namely, the risk defined by GCC 35(2)(j) as
'35(2) The "excepted risks" are risks of damage or physical loss ... caused by
or arising directly or indirectly as a result of or as a consequence of (a) ... (b) ...
(j) the design, specifications or instructions of the Engineer ...'
[150] For this purpose, 'Cost' is defined in GCC1(1)(h) as -
'compensation to the Contractor for such ... work, service or supply
concerned calculated, mutatis mutandis, in terms of Clause 40.'
[151] The plaintiffs have alleged, at pages 60 and 61 of their particulars of claim
'50. The excepted risk, for the reasons aforegoing, has come to pass and the
second defendant's order to the plaintiff to repair and make good the damage
to and/or loss of the Injaka bridge has resulted in:
50.1 the plaintiff having the first entitlement to being paid the costs
contemplated in terms of clause 40 of the GCC for damages or
physical loss caused to the works; ...
... [relates to Part B of Claim II(1), see below] 50.2
51 ...
52 The plaintiff, in the premises:
52.1 has complied with its obligations in terms of the relevant provisions
of the GCC; and 52.2 is entitled to recover those costs... which are not countenanced by and may
not be recovered pursuant to Claim I and which arise in
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consequence of the collapse of the Injaka bridge amounting to the sum of R28 052 267.22 as set out in schedule "X3" hereto.'
[152] Schedule X3 156 is divided into two parts, 'Part A (per Paragraph 50.1)' , and
'Part B (per Paragraph 50.2)'. Part A is as follows (with cents omitted and totals added):
'PART A, PER PARAGRAPH 50.1Item Description Amount VAT Total
2,795,694 391,397 3,187,092 1.
Demolition and removal of collapsed
portions of bridge and temporary works
2. Reconstruct temporary and permanent 2,924,350 409,409 3,333,759
work up to Segment 6 3. Launching nose and design costs 1.110.634 155.489 1.266.123
- Totals: 6.830.679 956.295 7.786.974'
[153] More detailed particulars of these claims are set out at pages 90 to 100 of the
particulars of claim. On the face of it, each of the alleged costs claimed by the plaintiffs.
in paragraph 50.1 and detailed in Part A of Schedule X3 and the further particulars at
pages 90 to 100 to it, appears to be a 'Cost' as defined in GCC 1(1)(h) read with GCC
40. 157
[154] Part A of Claim II(1} contains allegations that appear to be properly based on
the building contract.
Claim II(1)(Part B)
[155] Part B of Claim II(1) is not a claim brought within the terms of GCC
156 p 89, with fuller details at pp 90 to 126.
157 at pages 178 and 199 respectively.
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35(1)(c). In respect of Part B, the plaintiffs do not purport to make a further claim for the
'cost' of carrying out the order of the second defendants ('the engineer' acting as agent
for the first defendant) to repair and make good any damage or physical loss that was
caused to the works and the materials on site when the partially constructed bridge
collapsed on 6th July 1998, arising from any 'excepted risk'. Nevertheless, in Part B of
Claim II(1), the plaintiffs do purport to make a claim arising from an 'excepted risk'
alleged to be contemplated by the emphasized words 'or any other loss' in the following
extract from GCC 35(2)(j): 158
'35(2) The "excepted risks" are risks of damage or physical loss or any other loss
caused by or arising directly or indirectly as a result of or as a
consequence of - (a) ... (b) ...
(j) the design, specifications or instructions of the Engineer ...'
[156] In respect of Part 8 of Claim II(1), the plaintiffs have alleged - 159
'50 The excepted risk, for the reasons aforegoing, has come to pass and the
second defendant's order to the plaintiff to repair and make good the
damage to and/or loss of the Injaka bridge has resulted in:
50.1 ... [relates to Claim II(1) Part A, see above]
50.2 the plaintiff having the first entitlement to being paid for any other losses caused to it as contemplated in terms of clause 35(2)(j).
51 ...
52 The plaintiff, in the premises:
52.1 has complied with its obligations in terms of the relevant provisions
of the GCC; and 52.2 is entitled to recover those costs and any other losses which are
not countenanced by and may not be recovered pursuant to Claim
I and which arise in consequence of the collapse of the Injaka
bridge amounting to the sum of R28 052 267.22 as set out in
158 p 58, paragraph 48.2.
159 pp 60 to 62.
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schedule "X3" hereto.'
[157] Part B of Schedule X3 160 is as follows (with cents omitted and totals added): 161
'PART B PER PARAGRAPH 50.2
Item Description Amount VAT Total
15,153,348 2,040,314 17,193,661 5
Legal and expert fees, various
consultants
6 Costs incurred at time of collapse 477,477 40,380 517,857
7 Cost of financing Injaka bridge 5,590,764 782.707 6.373.471
Totals: 21.221.588 2.863.401 24,089,989'
[158] More detailed particulars of these claims are set out at pages 101 to 126 of the
particulars of claim. They fall under the following headings (the figures exclude VAT):
Item 5: Legal and expert fees, various consultants
5.1 Attorneys, Senior and Junior Counsel 7,456,174.25
5,514,717.88 5.2 Expert Witnesses
5.3 OHS Expert 386,300.31
112,120.00 5.4 Various Consultants: Structural Engineers
5.5 Various Consultants: Caltrop Contractual Advisor 33,725.00
5.6 Various Consultants: Jeffares & Green Expert Witness 104,413.28
5.7 Various Consultants: CWB Adjusters: Insurer's Agent
5.8 Various Consultants: Leonhardt, Andrä und Partner
43,305.75
168,408.88
5.9 Various Consultants: Prof G T van Rooyen 101,707.00
160 p 89, with further details at pp 101 to 126.
161 Part A of Claim II(1) consists of Items 1,2 and 3. Part B consists of Items 5, 6 and 7. The omission of Item 4 is cryptically explained at p 91 of the particulars of claim, thus: 'Note: Item 4:
Intentionally left blank, as it does not form part of this Schedule "X3".'
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5.10 Various Consultants: Helmut Kampf 17,625.00
192,543.755.11 Various Consultants: E Landman Co-ordinator
5.12 BKS Advantech 568,525.62
453.780.93 5.13 Innomet
Total of Item 5: 15,153,347.65
2,040.313.77 Total VAT:
Total including VAT: 17.193.661.42
Item 6: Costs incurred at time of collapse
6.1 Funerals, Death Benefits and Cash Payments 150,307.00
2,044.65 6.2 Flowers and Wreaths
6.3 Medical Costs 116,847.91
121,002.84 6.4 Travel and Accommodation
6.5 Printing, Stationery, Photographs 12,896.89
74,377.696.6 Media Communication
Total of Item 6: 477,476.98
Total VAT: 40.380.03
517.857.01Total including VAT
Item7: Cost of Financing Iniaka Bridge Collapse
The plaintiffs have detailed the monthly sums alleged to be their costs (or
'negative cash flow') attributable to the collapse of the Injaka Bridge on 6th July
1998. They have calculated interest on the increasing total from month to
month, at the prime rate of interest charged by their bankers from time to time.
The sums on which interest has been calculated include the additional
retention sums withheld by the first defendant for an increased period as a
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result of the collapse of the bridge. The interest calculation was made up to
30th November 2000. The position at that date is alleged to have been:
30th November 2000
Cumulative Negative Cash (on which interest calculated)
Balance of Retention Account (on which interest calculated)
28,505,605.85
1,773,976.00
Total interest, at prime, from 6th July 1998 5,590,763.86
782.706.94 VAT thereon
Total interest and VAT 6.373.470.80
[159] On the face of it, none of the items particularised in Part B of Claim II(1) was
a 'cost' recoverable by the plaintiffs in terms of GCC 35(1)(c). None was a 'cost' as
defined in GCC 1(1)(h) read with GCC 40. 162 Indeed, the plaintiffs make no allegation
to the contrary. The plaintiffs have been careful to distinguish between their cause of
action relating to Part A of Claim II(1), 163 and their cause of action relating to Part B of
Claim II(1). 164 However, their cause of action relating to Part B is, at best, obscure, if
it exists at all.
162 at pp 178 and 199 respectively.
163 Part A of Schedule X3, (p 89), expressly refers back to paragraph 50.1 of the particulars of claim (p
60). The essence of the cause of action for Items 1, 2 and 3, constituting Part A, is that they are all items of .cost' ,
as defined in GCC 1(1)(h), (p 178), read with GCC 40, (p 199); and that they represent remuneration to which the
plaintiffs are entitled in terms of GCC 35(1)(c) read with 35(2)(j), (p 195). For Part A, the plaintiffs do not rely on the
phrase 'any other losses'.
164 Part B of Schedule X3, (p89), refers back expressly to paragraph 50.2 of the particulars of claim (p 60). The ground of the plaintiffs' claim for Items 5, 6 and 7, constituting Part B, is that the
plaintiffs allege themselves to be entitled 'to be paid for any other losses caused... as contemplated in
terms of clause 35(2)(j).'
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Whether the plaintiffs' allegations relating to Part B of Claim II(1) disclose a valid cause
of action in contract
[160] At first sight, the plaintiffs' allegations relating to Part B of Claim II(1) lack
averments necessary to disclose a cause of action. The words 'any other loss' in GCC
35(2) have not there been used in a context that entitles the plaintiffs to payment for
anything at all. They merely form part of the definition of "excepted risks" for the
purposes of GCC 35. They extend that definition to include the risks of losses of kinds
other than those flowing from 'risks of damage or physical loss' .
[161] I should state at once that in these proceedings, the defendants have not taken
any exception to Claim II(1), Part B, or indeed to the formulation of any of the plaintiffs'
contractual claims. I am therefore not required to make any decision on the question
whether any of the plaintiffs' contractual claims is sustainable as a matter of law.
Nevertheless, the exceptions to the delictual claims were argued, by all three parties,
on the basis of the assumption that the allegations of fact constituting the plaintiffs'
contractual claims do indeed make out a case for the relief claimed, and that the case
made out, if proved, is valid in law, and therefore not excipiable.
[162] Counsel for both defendants submitted that, as the plaintiffs relied on
contractual remedies to which they would be entitled if, at the trial, they could prove the
allegations made in support of the contractual remedies claimed, their allegedly
concurrent claims to recover the same amounts as damages in delict were unnecessary
and bad in law. Counsel for the plaintiffs, on the other hand, whilst not disputing that,
if the plaintiffs' contractual claims should all prove to be successful, the alternative
claims in delict would be shown to have been unnecessary, submitted staunchly that this
is a case in which the plaintiffs have remedies against the first defendant in both
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contract and delict concurrently; that they are entitled to pursue both remedies
simultaneously; that there is no good reason in law why they should relinquish the
delictual claim in favour of the contractual claims, or vice versa, and that the existence
of their contractual claims against the first defendant makes no difference, on the facts alleged, to their only cause of action against the second defendants, being a claim in
delict, since they have no contract with the second defendants
To what extent is the court concerned with the question whether the plaintiffs have
made allegations that iustify concurrent claims against the first defendant in contract and
delict?
[163] In my view, for the reasons set out below, the assumption that the plaintiffs'
allegations relating to Part B of Claim II(1) disclose a valid contractual claim against the
first defendant, may well be a mistaken assumption. That assumption is, as I have said,
common cause between all three parties for the purposes of the present exceptions to
the delictual claims. Nevertheless, I consider it to be an assumption that is probably
fallacious. Moreover, it is an assumption that requires me to approach the exceptions
raised by the two defendants to the delictual claims in somewhat different ways.
[164] As against the first defendant, the plaintiffs' Claim I is a claim in contract for
payment of amounts totalling R7,983,669.00, plus VAT 165 (or a total of R9,101 ,382.66,
including VAT). Part of their Claim III against the first defendant, in delict, is for exactly
the same amounts. 166 To this extent, the question whether the plaintiffs have made
165 pp 52 to 53, para's 36.3 and 36.4; schedule 'X2', at pp 87 to 88; and prayers 1.2.2 and 1.2.7, at pp 82
and 83.
166 pp 66 to 67, para 67 (negligence); pp 69 to 70, para 72 (misrepresentation); schedule 'X4', at pp 127
(Item 4 only) and particulars of Item 4 at pp 141 to 142.
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averments sufficient to establish a case of concurrent causes of action in contract and
delict must in any event be dealt with. The same is true of the plaintiffs' Claim II(1), Part A. It
is a contractual claim for amounts totalling R7,786,973.75 (including VAT). 167 The
plaintiffs claim precisely the same amounts from the first defendant in delict in Claim
111. 168 The question whether the plaintiffs have disclosed grounds for concurrent claims
in contract and delict again arises.
[165] However, when it comes to the largest part by far of the plaintiffs' contractual
claims, Claim II(1), Part B, for amounts totalling R24,084,989.23 (including VAT), 169 the
position appears to be different. The plaintiffs claim precisely the same amounts from
the first defendant in delict in Claim III. 170 For reasons that I shall set out below, I am
of the opinion that the plaintiffs' allegations, to the extent that they rely on GCC 35(2)(j)
as entitling them to recover 'all other losses' caused by the second defendants, fail to
disclose a cause of action in contract against the first defendant for this amount. On
that view of the matter, the question whether the plaintiffs have disclosed concurrent
claims in contract and delict for the amount of R24,084,989.23 (including VAT), the
major part of all of their claims, does not arise. If that is correct, the only question in
regard to the exception to this part of the claim against the first defendant is whether the
167 p 60, para 50.1 (based on GCC 35(1)(c) and 40), read with p 89, schedule 'X3', Part A (Items 1, 2 and 3), with particulars of these items on pp 90 to 100; and p 63, para 58 (based on GCC
16(9) and 39), also read with p 89, schedule 'X3', Part A (Items 1, 2 and 3) and pp 90 to 100.
168 pp 66 to 67, para 67 (negligence); pp 69 to 70, para 72 (misrepresentation); read with schedule 'X4',
at p 127 (Items 1,2 and 3 only), with particulars of such items at pp 128 to 138.
169 p 60, para 50.2 ('any other losses'); schedule 'X3' at p 89, 'Part B per paragraph 50.2' (Items 5,6 and
7), with particulars of these items at pp 101 to 127.
170 pp 66 to 67, para 67 (negligence); pp 69 to 70, para 72 (misrepresentation); read with schedule 'X4',
at p 127 (Items 5, 6 and 7 only), with particulars of such items at pp 143 to 167.
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plaintiffs' averments are sufficient to set out a cause of action in delict.
[166] I turn now to consider the relevance of determining whether or not the plaintiffs
have succeeded in alleging concurrent causes of action in contract and in delict against
the first defendant for the amount of R24,084,989.23 (including VAT). In Lillicrap, 171
Grosskopf AJA, delivering the judgment of the majority of the court, observed:
'The mere fact that the respondent might have framed his action in contract
therefore does not per se debar him from claiming in delict. All that he need
show is that the facts pleaded establish a cause of action in delict.'
If that proposition had stood alone, the fact that a plaintiff enjoys a contractual remedy
would never make any difference to the question whether or not he also enjoys a
delictual remedy at the same time. However, the proposition does not stand alone. It
is qualified later in the same judgment, where the learned judge has stated: 172
'Apart from the judgments in Van Wyk vLewis (supra) 173 this Court has never pronounced on whether the negligent performance of professional
services, rendered pursuant to a contract, can give rise to the actio legis
Aquiliae. ... As far as this Court is concerned, it would accordingly be breaking
fresh ground if it were to recognise the respondent's cause of action as valid, at
any rate in so far as the cause of action arose prior to the assignment of the
contract of June 1975.174 Our law adopts a conservative approach to the extension of remedies
171 1985 (1) SA 475(A), at 496H.
1721985 (1) SA 475(A), at 500A - B, C - D and F -G. 173 1924 AD 438.
174 The contract of June 1975 was a contract of employment between the employers (Pilkingtons, who
were the plaintiffs suing in delict, and the respondents in the appeal) and the employees (Lillicrap,
consulting engineers, who were the defendants, and the appellants). In May 1976, a contract of
assignment had been concluded in terms of which Pilkingtons, with the co-operation of Lillicrap, had
assigned the contract of employment to Salanc, a construction company engaged by Pilkingtons. In May
1976, therefore, the privity of contract between Pilkingtons and Lillicrap came to an end, save for the fact
that Pilkingtons remained bound by a guarantee that Lillicrap's fees would be paid by Salanc. In any
event, Pilkingtons' contractual claim against Lillicrap had been extinguished by prescription. They
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under the lex Aquilia. ... In considering whether an extension of Aquilian liability
is justified in the present case, the first question that arises is whether there is a
need therefor. In my view, the answer must be in the negative, at any rate in so
far as liability is said to have arisen while there was a contractual nexus
between the parties. While the contract persisted, each party had adequate and
satisfactory remedies if the other were to have committed a breach. Indeed the
very relief claimed by the respondent could have been granted in an action
based on breach of contract.'
[167] As I understand these passages, paying due attention to the context from which
they have been taken, their substance may be summarized as follows. When a plaintiff
alleges that he has concurrent remedies in contract and in delict, the mere existence of
the contractual remedy is not necessarily. of itself, a bar to a concurrent Aquilian
remedy, provided that no extension of the Aquilian remedy beyond cases already .
recognised, is claimed. However, if the plaintiff, having a satisfactory contractual
remedy, claims a concurrent Aquilian remedy in respect of allegations of fact on which
the availability of such a remedy has not previously been recognised, the law requires
a conservative approach on the part of the court. Whether any need for a concurrent
Aquilian remedy has been shown, is then one of the primary considerations in
determining whether or not the remedy is available as a matter of law. Therefore, in
determining whether a delictual remedy based on Aquilian principles is available in a
particular case that is not already covered by a precedent, the mere fact that the plaintiff
has a satisfactory remedy in contract, so that he has no need of an Aquilian remedy
may, but will not necessarily, justify the conclusion that the plaintiff has no concurrent
Aquilian remedy.
therefore sued in delict, contending that they had had concurrent remedies in contract and delict and that the
latter remedy had not prescribed. The question of concurrent remedies in contract and delict therefore arose in
respect of the period prior to the assignment of May 1976.
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[168] On the other hand, if the plaintiff has no contractual remedy I the need for some
remedy may be obvious. Liability based on Aquilian principles cannot then be excluded I
even if the facts are novel in the sense that there is no precedent establishing that an
Aquilian remedy is available on precisely the facts in question. Whether a remedy based
on Aquilian principles is available in such a case will depend solely on the question whether the facts of the case satisfy Aquilian principles of liability. That question will not
be complicated by the further question that arose in Lillicrap, as to whether the
existence of a satisfactory remedy in contract establishes the absence of any need for
an 'extended' Aquilian remedy and, for that reason, precludes the recognition of such
a remedy.
[169] It is necessary, in my view, to consider how these propositions affect the
plaintiffs' claim to concurrent remedies in contract and delict in respect of the
R24,084,989.23 (including VAT) claimed in Part B of Claim II(1). This amount is some
two-thirds of the overall total of the plaintiffs' claims. To decide these exceptions to the
delictual claims entirely on the basis of a fallacious assumption that the plaintiffs have
a satisfactory contractual remedy relating to the major part of the claims would not, in
my view, serve the best interests of the parties. It may well turn out to be a fruitless
exercise, likely to lead to still further expense and delay.
[170] I therefore proceed to state my reasons for concluding that the plaintiffs have
not formulated Part B of Claim II(1) with any sound basis in GCC 35(2)(j) on which they
rely. I shall then go on to consider the exceptions to the plaintiffs' delictual claims on the
basis that the plaintiffs have no valid contractual claim against the first defendant in
respect of the sums claimed in Part B of Claim II(1), and that if the plaintiffs are to
recover the amounts there claimed, they can only do so by way of their delictual claims
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for the same amounts in Claims III and V. On this approach, the need for a remedy in
delict is self-evident, and the question that arose in Lillicrap, relating to the absence of
any need, will not have to be examined. The question will simply be whether the
plaintiffs' averments are sufficient to disclose a cause of action for an Aquifian remedy
against either or both of the defendants.
[171] I shall also come to a conclusion on the basis on which the parties argued the
exceptions, namely, the assumption (fallacious though I believe it may be) that the
plaintiffs' formulation of a contractual claim for the sums set out in Part B of Claim II(1)
contains averments disclosing a valid cause of action on the building contract. On this
approach, the questions raised by the exceptions include, amongst other questions
1 . whether the plaintiffs have made averments disclosing a valid delictual claim
against the first defendant (Claim III) that is concurrent with their contractual
claims against him for the same amounts (Claim II(1), Parts A and B); 2. whether, despite the existence of their contractual claims against the first
defendant (Claim II(1), Parts A and B), the plaintiffs have made averments that
disclose a valid delictual claim for the same amounts against the second
defendants (Claim V);
3. whether the plaintiffs' claim to an Aquilian remedy against each defendant is
novel, involving an extension of the remedy to a factual situation in respect of
which its availability has not previously been recognised; and
4. if either such claim is novel, whether there is a need for it in the novel
circumstances.
The Shortcomings in Claim II(1). Part B
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[172] Leaving aside the allegations relating to preliminary procedures prescribed by
the building contract, the substance of the essential allegations relating to Part B of
Claim II may be summarized in the following propositions A to G. After setting them out,
I shall comment on each proposition in turn:
A. The plaintiffs allege that they are, or it is, entitled to be -
'paid for any other losses caused to it as contemplated in terms of clause 35(2)(j)' 175
i.e. the plaintiffs allege in substance that the introductory words of GCC 35(2) 176
entitle them to be paid for aIl losses caused to them by -
(j) the design, specification or instruction of the Engineer ...'
including any losses other than those resulting from
'risks of damage or physical loss.'
B. By implication, the plaintiffs allege further that the categories of loss
contemplated by GCC 35(2)(j) are
(1) losses resulting from risks of damage or physical loss caused by 'the
design, specification or instruction' of the second defendants; and
(2) losses resulting from risks of 'any other loss caused by... the design,
specification or instruction' of the second defendants.
C. By implication, the plaintiffs also allege that category B(2) above is wide
enough to encompass such losses suffered by the plaintiffs themselves.
D. The plaintiffs allege that the first defendant is obliged in terms of the building
175 p 60, para 50.2.
176 '35(2) The "excepted risks" are risks of damage or physical loss or any other loss caused by or
arising directly or indirectly as a result of ar as a consequence of (a) ...'
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contract to pay them for any such other losses that they may suffer. 177
E. The plaintiffs allege that the 'design, specification or instruction' of the second
defendants, within the meaning of GCC 35(2)(j), caused the collapse of the
partly built bridge on 6th July 1998. 178
F. Finally, the plaintiffs allege that the collapse of the partly built bridge caused
them to sustain the losses, being 'any other losses' contemplated by GCC
35(2)(j), detailed in, inter alia, Items 5, 6 and 7 (being Part B) of Schedule X3.179
177 This is one of the implications of prayer 1.2.3 at pp 81 to 82, reading:
'WHEREFORE plaintiff prays for judgment against the defendants jointly and severally, the
one paying the other to be absolved:
1 1.1 Payment of the amount of R36 035 936.22, the make-up of which appears more fully
below;
l.2 the first defendant for:
1.2.1
1.2.3 payment of the amount of R28 052 267.22, representing those costs and/or
losses not recovered pursuant to paragraph 1.2.2 above and whether
awarded under the first entitlement and/or the second entitlement as set out
in the schedule annexed hereto marked "X3".'
The 'first entitlement' is a reference to Claim II(1). Part A, being a claim to Items 1.2 and 3 of Schedule "X3" in terms of GCC 35(1)(c) and 35(2)(j). The 'second entitlement' is a reference to Claim
II(1), Part B, being a claim to Items 5, 6 and 7 of Schedule "X3" in terms of GCC 35(2)(j) alone.
(Note: The prayer for judgment against the defendants 'jointly and severally' cannot possibly extend to
prayer 1.2.3. The latter is a prayer based on Claim II(1), Part A and Part B, which is a claim based on the building contract, against the first defendant alone. There are no allegations to support
the prayer for the second defendants to be held liable in contract jointly and severally with the first
defendant. The only possibility of joint and several liability relates to the prayers based on the delictual
claims, Claims III and V. These prayers are, in respect of the first defendant, prayers 1.2.4 (read with
1.2.7) and 1.2.5, and in respect of the second defendants, prayers 1.3.1, 1.3.2 and 1.3.3. Prayer 1.2.3
cannot be joint and several with any claim against the second defendants.)
178 p 59, para 49.
179 pp 61 to 62, para 52.2; and p 89 (Schedule "X3").
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G. On these essential grounds, the plaintiffs claim that the first defendant is liable
to them in terms of the building contract for payment of the amounts of Items
5, 6 and 7 in Schedule "X3".
[173] I turn now to comment on these six propositions. Proposition A is in my view
fallacious. Nothing in GCC 35 entitles the plaintiffs to payment for 'any other losses'.
The phrase 'any other losses' is used merely as a part of the definition of 'excepted
risks'. 'Excepted risks' have been defined in GCC 35(2) for two purposes only. The
purpose of providing reimbursement or compensation to the plaintiffs for 'any other
losses' is not one of them. The only two purposes served by the definition are
1. to determine the circumstances in which the plaintiffs will not be liable in terms
of GCC 35(1)(b) to repair or make good at their own cost, damage or physical
loss to the works or materials; and
2. to determine the circumstances in which the plaintiffs will, in terms of GCC
35(1)(c) -
(1) be obliged to repair or make good damage or physical loss to the works or
materials; and
(2) be entitled to payment by the first defendant of the cost of doing so.
[174] In defining the 'excepted risks' in GCC 35(2), the parties have taken the
following factors into account and have made the following provisions:
1. They have made provision for the fact that damage or physical loss may be
caused to the works or materials
(1) by one of the risks specified in GCC 35(2) ('the excepted risks'); or
(2) by any of many other unspecified risks ('the residual risks');
2. They have specified that the 'excepted risks' are
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(1) The risk that one of the causes listed in sub-paragraphs (a) to (I) of GCC
35(2) ('the listed causes') may cause 'damage' (physical deterioration) to,or the 'physical loss' of, the works or the materials. This is a risk of
damage or loss that would be sustained by the first defendant alone.
(2) The risk that one of the listed causes may cause 'damage' or 'physical
loss' to any corporeal property whatever, other than the works or materials.
This is a risk of damage that could be sustained not only by the first
defendant, but also by the plaintiffs or by any third person.
(3) The risk that one of the listed causes may result in 'any other loss' (i.e. a
loss such as 'pure economic loss', which is a loss other than a loss caused
by any of the risks referred to in (1) and (2) above). The phrase 'any other
loss' is very wide. It contemplates any loss of any kind suffered by any
person at all, whether one of the parties to the building contract or a third
person, except only a loss resulting from one of the risks referred to in (1)
and (2) above.
(4) The risk that the materialization of any of the risks referred to in (2) and (3)
above may in turn result in damage to, or the physical loss of, the works
or materials, as contemplated by GCC 35(1)(b) and (c). 180
100 It is not easy to visualize a credible example of how pure economic loss suffered by the plaintiffs or
the first defendant or a third person might result in 'damage or physical loss to the works or materials'.
Nevertheless, as a contractual term it is by no means without content. No doubt the contracting parties
had in mind such possible eventualities as, for example, the materialization of the risk that war or
insurrection (GCC 35(2)(a) or (b)), without directly causing damage or physical loss to the works or the
materials, might cause disruptions resulting in serious economic loss to the plaintiffs; that the
economic loss to the plaintiffs might result in their not having the financial means to be able to look
after the works and materials in terms of GCC 35(1)(a); and that the plaintiffs' neglect of this obligation
might in turn result in damage or physical loss to the works or materials. In circumstances such as these, the risk of
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3. The residual risks, which the plaintiffs agreed to carry, embrace all other risks
contemplated by the plaintiffs' undertaking in GCC 35(1)(a) to -
'take full responsibility for the care of the Works and of all materials on the
Site intended for incorporation in the Works'
until the date of issue of a certificate of completion.
[175] Nothing in GCC 35(2), duly read in its context, supports the plaintiffs'
allegation 181 that they are, or it is, entitled
'to be paid for any other losses caused to it as contemplated in terms of
clause 35(2)(j).'
I conclude that proposition A is fallacious.
[176]
[1 77]
Propositions B and C are not incorrect.
Proposition D is fallacious, for reasons similar to those given above in respect
of proposition A.
[ 178] For the purposes of the present exceptions, it must be accepted that
propositions E and F are correct. However, the mere fact that the plaintiffs may have
sustained the losses alleged in Part B of Claim II(1) 182 is not a sufficient reason for the
further proposition that the first defendant is obliged in terms of GCC 35(2)(j) to
'any other loss' (contemplated by the introductory words of GCC 35(2)) would have materialized and
would itself have caused damage or physical loss to the works or materials; such damage or physical
loss would therefore have been caused by an 'excepted risk' as defined; and the plaintiffs would not be
obliged by GCC 35(1)(b) to repair and make good the damage or physical loss at their own expense;
but, if ordered to do so by the second defendants in terms of GCC 35(1)(c), the plaintiffs would be
obliged to repair and make good, and would also be entitled to receive payment from the first defendant
for doing so.
181 Particulars of claim, p 60, para 50.2.
182 Schedule X3, p 89, Items 5, 6 and 7.
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compensate them for those losses. The position relating to Part A of Claim II(1) 183 is
entirely different, because the plaintiffs have alleged that the items there contemplated
constituted 'damage or physical loss caused to the works' 184 by the alleged 'design, specification or instruction' of the second defendants; that the second defendants had
ordered them to repair it and make it good; and that, having done so, they had become
entitled to payment in terms of GCC 35(1)(c).
[179]
[180]
The conclusion expressed in proposition G above is therefore false.
Subject to the reservations in the next paragraph, I conclude that the plaintiffs
have failed to set out a cause of action in contract for payment by the first defendant of
the sum of R24,084,989.23 (including VAT), being the total of Items 5, 6 and 7 in Part
B of schedule X3. On the strength of that conclusion, I consider that my approach to
the exceptions taken to the plaintiffs claims in delict, Claims III and V, must not overlook
the fact that the plaintiffs may have no claim in contract for the R24,084,989.23 in
question. Therefore, I intend to approach the exceptions on the basis of what appears
to me to be the likelihood, namely, that the plaintiffs have not disclosed a cause of
action in contract for this sum based on GCC 35(2)(j); that the question relating to this
important proportion of the totality of the plaintiffs' claims is not whether the plaintiffs
have a concurrent action in delict for it; and that the question in respect of this sum is
simply whether the plaintiffs have set out a cause of action in delict. As I have indicated,
the difference is of considerable importance.
[181] However, the exceptions were not argued by any of the parties on the basis that
I have set out in the previous paragraph. The submissions for all three parties were
183 Schedule X3, p 89, Items 1, 2 and 3.
184 Particulars of claim, p 60, para 50.1. 'P'
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based on the assumption that the plaintiffs have set out valid causes of action in each
of the contractual claims. Moreover, although the plaintiffs' particulars of claim make
no express reference to the indemnity that the first defendant afforded to the plaintiffs
in GCC 36(2),185 that provision is in fact a part of the pleadings.
The effect of the indemnity given bv the first defendant to the plaintiffs in terms of
GCC 36(2)
[182] In terms of GCC 36(2), the first defendant has indemnified the plaintiffs against
all liability in respect of a number of 'matters'. This indemnity extends to, amongst other
matters, claims by third parties against the plaintiffs arising out of any act, omission or
neglect on the part of the second defendants that may have resulted in injuries or
damage to persons or property. It also applies to claims by third parties against the
185 So far as presently relevant, GCC 36, at p 196, provides: 'Injury to persons and damage to property 36. (1) The Contractor
(a) hereby indemnifies the Employer against any liability in respect of damage to
or physical loss of the property of any person or injury to or death of any
person, and
(b) shall be liable to the Employer for damage to or physical loss of all property
of the Employer not being portion of the Works nor of the Site.
arising directly from the execution of the Works;
Provided that nothing herein contained shall render the Contractor liable in
respect of
(i) ...
(v) injuries or damage to persons or property resulting from any act,
omission or neglect of the Employer, his agents, employees or other
contractors (not being employed by the Contractor) or from proper
compliance with any instruction of the Engineer or Employer, ... Indemnity by Employer (2) The Employer hereby indemnifies the Contractor against all liability inrespect of the matters referred to in the proviso to Sub-Clause (1).'
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plaintiffs arising out of proper compliance by the plaintiffs with any instruction of the second defendants.
[183] Having regard to the contents of Claim II(1), Part B, it appears to me that at
least some of the amounts that the plaintiffs have characterized (wrongly in my view) as
'any other loss' within the meaning of GCC 35(2) alleged (also wrongly in my view) to
be recoverable by the plaintiffs in terms of GCC 35(2)(j), may nevertheless represent
'matters' in respect of which the first defendant has indemnified the plaintiffs against all
liability in terms of GCC 36(2). Moreover, in Claim II(1), Part B, the plaintiffs have in
substance made allegations that at first sight appear to disclose a cause of action in
terms of the indemnity granted by the first defendant. In my view, one of the reasonably
possible interpretations of Claim II(1), Part B, is that, leaving aside as irrelevant the
references to GCC 35(2)(j), the claim contains what amount to allegations that an 'act,
omission or neglect' 186 on the part of the second defendants (as agent of the first
defendant), or the plaintiffs' own 'proper compliance with [an] instruction' 187 of the
186 ie the second defendants' alleged acts of introducing one or other or both of the designfaults into the design for the permanent and the temporary works; and of approving the plaintiffs'
drawings for the temporary works as compatible with the design for the permanent works when they
were not compatible; and the second defendants' alleged omission or neglect to design the bottom
panel or slab of the deck sections with an appropriate degree of strengthening by means of reinforcing
steel, particularly in the region of the web-soffit conjunction, as well as their omission or neglect to
disapprove the plaintiffs' drawings relating to the positioning of the temporary bearings as being
drawings that were incompatible with design for the permanent works, because the designed strength
of the bottom slab and the websoffit conjunction was insufficient to withstand the forces to which it
would be subjected during the incremental launching process.
187 i.e. the second defendants' express or implied instruction to build the temporary and permanent works in
accordance with the second defendants' design for the permanent works (incorporating the second
defendants' design faults relating to the inadequate strength of the bottom slab of the deck sections and
the inappropriate positioning of the temporary bearings); and the instruction to build in accordance with
the plaintiffs' design for temporary works (incorporating the inappropriate positioning of the temporary
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second defendants, has resulted in 'injuries or damage to persons or property.' 188
[184] Whether, or to what extent, the plaintiffs may be entitled to recover from the first
defendant, in terms of the indemnity in GCC 36(2), the amounts claimed by the plaintiffs in
Part B, Items 5, 6 and 7, of schedule X3, 189 depends upon whether the plaintiffs have or had a legal liability to pay such amounts to each of the persons claiming them; and
if so, whether such legal liability was caused by an 'act, omission or neglect' on the part
of the second defendants. These questions do not have to be resolved at the present
stage. It is sufficient that, as appears to me to be the position, a reasonably possible
interpretation of the plaintiffs' allegations relating to Claim II(1), Part B, discloses a
contractual cause of action in terms of the indemnity that the first defendant afforded to
the plaintiffs in terms of GCC 36(2).
[185] This conclusion has the following consequences:
1. To the extent that the plaintiffs have founded Claim II(1), Part B (claiming the
R24,084,989.23 detailed in items 5, 6 and 7 of schedule X3 and its annexes)
on the provisions of GCC 35(2)(j), they have not, in my prima facie view,
disclosed a valid cause of action in contract. Therefore, the question raised in
the exceptions, concerning the validity of the delictual claims, Claims III and V,
for the same R24,084,989.23, similarly detailed in items 5, 6 and 7 of schedule
bearings as suggested by the second defendants) as approved by the second defendants.
188 The particulars of the plaintiffs' claims for medical costs, in schedule X3, at pp 116 and 117, indicates
the identities of persons who apparently have claims against the plaintiffs arising out of personal injuries
sustained in the collapse of the bridge (or who had such claims until they were settled by the plaintiffs).
As to damage to property, the plaintiffs have alleged that the first defendant's own property, the partly
constructed bridge, was damaged. The first defendant's indemnification of the plaintiffs 'against all liability
in respect of such damage arguably extends to all liabilities incurred by the plaintiffs to anyone, including
the first defendant, in consequence of the collapse of the bridge.
189 p 89 and pp 101 to 126.
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X4 and its annexes, is not complicated by the consideration that played an
important role in Lillicrap. 190 On this view of the matter, the plaintiffs' only
claims for the sums in question, if they have a claim at all, are those that they
have made in delict. I shall therefore approach the exceptions on that basis in
respect of so much of the delictual claims as relates to the amount totalling
R24,084,989.23, detailed in items 5, 6 and 7 of schedule X4.
2. However, the view that I have taken in the last paragraph is one at which I have
arrived without hearing argument on it. I shall therefore also reach a
conclusion on the basis of the assumption on which the exceptions were
argued by all three parties, namely, the assumption that the allegations made
in all of the plaintiffs' contractual claims, including Claim II(1), Part B, do indeed
disclose valid claims based on the provisions of the building contract.
3. The adoption of this double-barrelled approach is also necessitated by reason
of my further conclusion, also arrived at without having heard argument on it,
that the plaintiffs' allegations in support of Claim II(1), Part B, if their reliance
on GCC 35(2)(j) is ignored as irrelevant, appear to disclose a valid contractual
claim against the first defendant based on the indemnity given by the first
defendant in GCC 36(2).
The plaintiffs' third contractual claim. for R6.830.678.73 (excluding VAT) (Claim II(2) 191
[186] The R6,830,678.73 (plus VAT of R956,295.02) claimed in Claim II(2) is the
very sum claimed in Part A of Claim II(1). Both have been arrived at as more fully set
190 1985 (1) SA 475(A).
191 Particulars of claim. pp 62 - 64, para's 54 - 61.
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out in Part A of Schedule X3, and the particulars thereto.192 Claim II(1 )(Part A) and
Claim II(2) are different, and alternative, contractual causes of action for the same sum
of money. Whilst Claim II(1)(PartA) is based on GCC 35(1)(c), Claim II(2) is based,
in the alternative, on certain of the provisions of GCC 16(5), (6) and (9); 193 and 39(1) and
(2); 194 and 40.195
[187] In this alternative formulation, the plaintiffs allege, in substance
1. that after the failure of the partially constructed Injaka bridge on 6th July 1998,
the second defendants, during or about the period from August 1998 to March
1999, as they were entitled to do, issued new drawings, specifications and
instructions to the plaintiffs, amounting to variation orders, for the completion
of the bridge in a manner and with features that varied from the original
192 Particulars of claim, pages 89 to 100
193 GCC 16(5), (6) and (9) (at p 188) provide: 'Drawings and Specifications 16. (5) On the Commencement Date the Engineer shall deliver to the Contractor copies of the
Drawings, Specifications and other relevant documents required for the commencement of the Works.
Further Drawings, Specifications and instructions 16. (6) The Engineer shall deliver to the Contractor from time to time, during the progress of the Works,
such modified or further Drawings or Specifications or instructions as shall, in the Engineer's opinion, be necessary for the proper and adequate construction, completion and defectscorrection of the Works. (7) ... (8) ...
Contractor to give effect to Drawings etc. 16. (9) The Contractor shall give effect to and be bound by any Drawing, Specification or instruction given in terms of this Clause and, if the same shall require any variation of, addition to or omission from the Works, the same shall be deemed to have been issued in terms of Clause 39.
194 GCC 39(1) and (2)('Variations') (at p 198 of the particulars of claim),quoted above.
195 GCC 40 (Valuation of Variations') (at p 199 of the particulars of claim), quoted above.
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contract;
2. that on 3rd March 1999 the second defendants issued a written order to the
plaintiffs to proceed with the work according to the new design, specifications
and instructions;
3. that the plaintiffs, as they were obliged to do, duly completed the bridge
accordingly;
4. that the plaintiffs therefore became entitled to remuneration for the variations
in accordance with GCC 39 and 40; and
5. that the amount remaining unpaid is the sum of R6,830,678.73, calculated as
set out in Items 1, 2 and 3 of Schedule X3 (above), plus VAT of R956,295.02,
totalling R7,786,973.75.
The plaintiffs' fourth contractual claim, for R1,396.470.55 (including VAT), as the unpaid
balance of Certificate 39 (Claim IV) 196
[188] The plaintiffs allege that, in accordance with GCC 52,197 they duly submitted to
196 Particulars of claim, pp 70 - 72.
197 GCC 52 (at p 207) provides, so far as presently relevant
'Monthly payments 52. (1) With regard to all amounts becoming due to the Contractor in respect of the matters set out in
paragraphs (a), (b), (c), (d) and (e) below, he shall deliver to the Engineer a monthly statement
for payment of all amounts he considers to be due to him (in such form and on such date as
may be agreed or failing agreement as the Engineer may require) and the Engineer shall, by
signed payment certificates issued to the Employer and the Contractor, certify the amount
which he considers to be due to the Contractor. taking into account the following:
(a) the estimated value of the Permanent Works executed and calculated in terms of the
Contract up to the date of the Contractor's said statement;
(b) such amount as the Engineer may consider to be fair and reasonable for any Temporary
Works or other special items for which separate amounts are provided in the Schedule
of Quantities;
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the second defendants, on or about 26th February 2001, a statement of the amounts
they considered to be due and payable to themselves in respect of the period from 1st
December 2000 to 23rd February 2001; that the second defendants in response issued
Interim Payment Certificate No 39 dated 9th March 2001 to the plaintiffs and the first
defendant certifying that the sum of R2,570,669.77 (including VAT) was due and
payable by the first defendant to the plaintiffs; 198 that such sum was due and payable
not later than 3rd April 2001; that the first defendant has paid no more than
R1,174,199.22 of the amount in question; that the first defendant is accordingly liable
(c) any amounts additional to those referred to in this Sub-Clause which are due to the
Contractor;
(d) adjustments under Clause 49;
(e) the value of the percentage limit, if any, stated in the Appendix of materials referred to
in Clause 32(1) not yet built into the Permanent Works;
Provided ... (2) ... (3) '"
Employer's obligation to pay
(1) The Engineer shall deliver to the Employer and the Contractor the payment certificate referred
to in Sub-Clause (1) within 21 days after the receipt by the Engineer of the Contractor's said
statement, and the Employer shall pay the amount due to the Contractor within 35 days after
receipt by the Engineer of the Contractor's said statement.
(2) ... (6) ...
Set-off and delayed payments
(7) In respect of any amount payable to the Contractor in terms of the Contract,
(a) the Employer may deduct from such payment any amounts which he is entitled by law to set
off against such payment and shall state in a notice accompanying the said payment the
reasons for such deductions, and
(b) in the event of failure by the Employer to make the payment on its due date, he shall pay to
the Contractor interest at the prime overdraft rate as certified by the Contractor's bankers
upon all overdue payments from the date on which the same should have been made,
without limiting any other right which the Contractor may have by reason of such failure to
make due payment. (8) ... (9) ... (10) ...
198 Particulars of claim, p 607.
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to the plaintiffs for payment of the balance of R1,396,470.55 and interest thereon
calculated from 3rd April 2001 to date of payment at the agreed rate, namely, the rate certified by the plaintiffs' bankers as their prime rate from time to time. 199
Summary of plaintiffs' contractual claims
[189] To sum up, the plaintiffs claim specific performance of the building contract that
they concluded with the first defendant in the following respects:2OO
1. in terms of GCC 45(2) and (3), an extension of time of 14,68 months, running
from 4th August 1999 to 24th October 2000, for the completion of the contract;201
2. in terms of GCC 45(4), additional time-related Preliminary and General
allowances totalling R7,444,692.71; 202
3. in terms of GCC 49(2) and (3), the alleged unpaid balance of the applicable
Contract Price Adjustment Factor in respect of payment certificates 23 to 38
relating to the period from 4th August 2000 to 30th November 2000, amounting
to R538,976.29; 203
4. in terms of GCC 35(1)(c) and 35(2)(j), read with GCC 1(1)(h) and 40, the 'cost'
of carrying out the order of the second defendants to repair and make
199 Particulars of claim, p 608. The plaintiffs have attached a certificate by the Standard Corporate and
Merchant Bank showing that their prime rate was fixed on 25th January 2000 at 14,50% and that on
18th June 2001 it was reduced to 13,75%. These are the rates claimed.
200 To the extent that the various claims may overlap, the plaintiffs disclaim any intention of achieving
double recovery in any respect.
201 Claim I, p 52, par 36.2; and Schedule X1, p 85.
202 Claim I, p 52, par 36.3; and Schedule X2, p 87.
203 Claim I, p 53, par 36.4; 'Contract Price Adjustment Schedule', pp 221 to 222; and Schedule X2, p88.
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good the damage or physical loss caused to the works or materials
arising from the design, specification or instruction of the second
defendants, amounting to R7,786,973.75 (including VAT); 204
5. in terms of a misinterpretation of GCC 35(2), an invalid claim for 'any other
loss' amounting to R24,084,989.23 (including VAT); 205
6. in terms of GCC 16(9), 39 and 40. the value of additional work done by the
plaintiffs in accordance with drawings, specifications and instructions given by
the second defendants and acted on by the plaintiffs. amounting to
R7,786,973.75 (including VAT), and being an alternative cause of action for the
sum claimed in Claim II(1). Part A; 206
7. in terms of GCC 52, the unpaid balance of Interim Payment Certificate No. 39,
for the period 1st December 2000 to 26th February 2001, issued on 9th March 2001, for R2,570.669.77, such unpaid balance being R1,396,47.55
(including VAT). and interest thereon at the rate of 14.5% p.a. from 3rd April
2001 to 17th June 2001 and thereafter at 13.75% p.a. (or any subsequent
prime rate established by the Standard Bank) until date of payment. 207
20<! Claim II(1), Part A, pp 57 to 62, especially par 50.1; and Schedule X3, 'Part A per par 50.1', pp 89
and 90 to 100.
205 Claim II(1), Part B, pp 57 to 62, especially par 50.2; and Schedule X3, 'Part B per par 50.2', pp 89 and 101 to 126. As indicated above, I shall also assume (contrary to my main finding) that
Claim II(1). Part B is valid, either as set out by the plaintiffs, or on the basis that the plaintiffs' reference
to GCC 35(2)(j) can be ignored as irrelevant and that the plaintiffs' allegations set out a claim based on
the indemnity afforded by the first defendant in GCC 36(2).
206 Claim II(2), pp 62 to 64, pars 54 to 61; and Schedule X3, Part A, pp 89 and 90 to 100.
207 Claim IV, pp 70 to 72, pars 73 to 82; and Certificate 39 at p 607.
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The plaintiffs' claims in delict
[190] The plaintiffs make delictual claims for damages against both the first and
second defendants under several heads, for sums amounting to R36,035,936.22 plus
VAT of R4,937,409.42, totalling R40,973,345.64, as particularized in Schedule X4.208
In Claim V, these claims are made against the second defendants as the wrongdoers,
there being no privity of contract between the plaintiffs and the second defendants. In
Claim III, the plaintiffs allege in substance that the first defendant is vicariously liable
to them for the damages caused by the wrongful and unlawful conduct of the second
defendants as the wrongdoers in the respects alleged in Claim V.
[191] In the heading to Claim III, the delictual claim against the first defendant is
expressed to be 'concurrent' with the plaintiffs' contractual claims, Claims I and II, and
to be restricted to such damages or losses as the plaintiffs may fail to recover in
contract. As the plaintiffs correctly recognize that they cannot recover the same damages or losses twice over, their delictual causes of action against the first
defendant, although existing 'concurrently' with the contractual causes of action in
Claims I and II, are nevertheless brought as alternative remedies for the same damages
or losses as have been claimed in contract, in Claims I and II. There is no delictual
claim that corresponds to Claim IV, the plaintiffs' contractual claim for the unpaid
balance of payment certificate no. 39.
[192] The total of the delictual damages claims reflected in Schedule X4 209 (pursued
against the first defendant in Claim III and against the second defendants in Claim V)
is made up of claims for seven items, six of which are the exact equivalents of items 1,
208 Particulars of claim, p 127.
209 At p 127.
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2, 3, 5, 6 and 7 in Schedule X3, 210 containing the items claimed from the first defendant
on different contractual grounds in both claim II(1) and claim II(2). The seventh item
in the computation of the plaintiffs' alleged delictual damages claims (Item 4 in Schedule
X4, for R7,983,669.00, plus VAT of R1,117,713.66) 211 is the equivalent of the plaintiffs'
contractual claim 1 against the first defendant, amounting to the R7,983,669.00
reflected in Schedule X2. 212 The latter contractual claim also extends to VAT on the
sum stated.213 The plaintiffs' contractual claims in Claims I, II(1) and II(2) against the
first defendant alone are therefore for precisely the same sums as their claims for
delictual damages from the first defendant in Claim III and against the second
defendants in Claim V. The position is illustrated in the following table, comparing the
contractual and delictual claims:
210 At pp 89 to 126.
211 At p 127.
212 At p 88.
213 See prayer 1.2.2 at p 82, and prayer 1.2.7 at p 83.
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DELICT ;-------------------------------- ;--
X4 Item
DESCRIPTION Amount (inc VAT)
CONTRACT
X2 or X3 Item
X4 -1 Demolition and removal of collapsed portionsof bridge and temporary works
3,187,091.59 X3 - 1
X4 - 2 Reconstruct temporary and permanent work up to Segment 6
X4 – 3 Launching nose and design costs
X4 - 4 Cost of time extension and reinstatement of reduced escalation
X4 - 5 Legal and expert fees, various consultants X4 - 6 Costs incurred at time of collapse X4 – 7 Cost of financing bridge collapse
,
3,333,758.97 X3-2
1,266,123.19 . X3 - 3 ,
9,101,382.66 X2
17,193,661.42 X3 - 5517,857.01 X3-6
6,373,470.80 X3-7 -----------.
Total: 40,973,345.64
NOTE: Claim I includes a claim in contract for 'additional time-related preliminary and
general allowances' of R7,444,692.71 ; 214 and a further R538,976.29 in respect of the
balance of cost 'escalation' said to be payable by the first defendant in accordance with
the agreed formula for arriving at a 'Contract Price Adjustment Factor'. 215 These sums
214 In terms of GCC 45(4): see particulars of claim, p 52, para 36.3, read with Schedule X2 at p 87
215 In terms of GCC 49(2) and (3), at p 204, read with the 'Contract Price Adjustment Schedule' ('CPAS') at p
221. See particulars of claim at p 53, para 36.4, and Schedule "X2" at p 88. It appears that the second
defendants took the view that the 'Due Completion Date' was 3rd August 1999; that in terms of clause 3 of the
CPAS (at p 222 of the particulars of claim) the plaintiffs were no longer entitled, after 3rd August 1999, to any
more than one-half of the Contract Price Adjustment Factor ('CPAF') applicable for the period prior to the 'Due
Completion Date'; and that, when issuing payment certificates relating to the period after 3rd August 1999, they therefore calculated the cost escalation at one-half of the rate previously applicable in terms of the
agreed CPAF formula. The plaintiffs' claim for the balance of cost 'escalation' calculated at one-half of the
CPAF formula in respect of the certificates relating to the period after 3rd August 1999 is evidently based on
the view that they had been entitled to an extension of the 'Due Completion Date' beyond 3rd August 1999, as
claimed in Claim I; that the reduction imposed by clause 3 of the CPAS had therefore not been applicable; and
that the second defendants had erred in calculating the cost 'escalation' at only one-half of the agreed CPAF formula.
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provide the total of R7,983,669.00 reflected in Schedule X2 (at p 88 of the particulars
of claim) that the plaintiffs claim in paragraph 36.3 at p 52 of their particulars of claim,
and in prayer 1.2.2 at p82. This total does not include VAT. However, the plaintiffs do
in fact claim VAT on that sum, but in an amount that has not been quantified for
purposes of the relevant contractual claim, Claim I: see prayer 1.2.7 at p 83. However,
in their delictual claims, Claims III and V, the plaintiffs are pursuing precisely the same
total of R7,983,669.00, arrived at in precisely the same way. In addition, they have, in
Claims III and V, quantified their claim for VAT on the amount of R7,983,669.00 at
R1,117,713.66. 216 The contractual and delictual claims in respect of this item are
therefore both for the same total of R9,101,382.66, arrived at in precisely the same
manner.
The plaintiffs' delictual claims against the first defendant
[193] The essence of the plaintiffs' causes of action in delict against the first
defendant is that the first defendant is vicariously liable for one or other or all of three
kinds of wrongful acts said to have been committed by the second defendants, one or
other or all of which kinds of acts are said to have caused the plaintiffs to suffer the
damages claimed. The wrongful acts are said to be breaches of legal duties owed by
the second defendants to the plaintiffs that can, as I understand them, be summed up
in broad terms as the following three
1. the wrongful breach by the second defendants of an alleged legal duty to take
the care that would have been taken by a reasonable man in the
circumstances, to ensure that the Injaka bridge was designed in such a way as
216 Schedule X4, Item 4, at p 127 of the particulars of claim.
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to be 'buildable' by the incremental launching method, such breach therefore
amounting to negligence (i.e. the breach of a legal duty of care);
2. the wrongful breach by the second defendants of an alleged legal duty to
refrain from approving the plaintiffs' plans for the temporary works as
being compatible with the second defendants' design for the the
permanent works when they were not compatible; and
3. the wrongful breach by the second defendants of an alleged legal duty to
refrain from misrepresenting to the plaintiffs that the plaintiffs' plans for the
temporary works were compatible with the second defendants' design for the
permanent works when they were not compatible.
[194] The plaintiffs' delictual causes of action against the second defendants, and the
damages claimed, are substantially the same as those for which the first defendant is
alleged to be vicariously liable, as set out above. However, there are also certain
differences that will be mentioned below.
[195] It is convenient to deal first with the allegations relating to the legal duties of the
second defendants on which the plaintiffs rely, and to come later to the allegations said
to establish the first defendant's vicarious liability for the second defendants' alleged
delicts.
The plaintiffs' allegations of negligent and wrongful breaches of a duty of care by the
second defendants. and their wrongful breaches of other legal duties
[196] In setting out Claim V, the plaintiffs begin with certain allegations that plainly
refer to the consultancy agreement between the first and second defendants, and also
to the building contract between the plaintiffs and the first defendant. It is convenient
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to start with the extent to which the plaintiffs have relied upon the consultancy
agreement for the conclusions in respect of the alleged liability of the second
defendants to the plaintiffs in delict.
The plaintiffs' reliance on the consultancy agreement for purposes of the claims in delict
[197] The plaintiffs allege that the consultancy agreement was concluded between
the first defendant and the second defendants on 19th June 1996, 217 and they have
annexed a copy of it to their particulars of claim. 218 They have drawn particular
attention to the following provisions of the consultancy agreement:
1. Clause 3.3, 219 according to which the first defendant is alleged to have
authorized the second defendants to act as his agent.
2. Clause 4.1 , 220 according to which the second defendants were to exercise two
217 Particulars of claim, p 34, para 11.1.
218 Particulars of claim, p 34, para 11.3, and pp 520 to 572. In the consultancy agreement, the following terms have the following meanings, for present purposes:
'Client' means 'the first defendant';
'Consulting Engineer' means 'the second defendants';
'Contractor' means 'the plaintiffs';
'The Contract' means 'the building contract' between the first defendant and the plaintiffs.
219 p 35, para 12.1, and p 533: 'The Client's Responsibility to the Consulting Engineer
'3. The Client shall:
3.1 ... 3.2 ...
3.3 Authorise the Consulting Engineer to act as his agent for such purposes as may be
necessary for the performance by the Consulting Engineer of his services hereunder.'
220 p 35, para 12.2, and p 534:
'4. The Consulting Engineer's Responsibilities to the Client '4.1 The Consulting Engineer shall exercise two distinct and separate functions in terms of
these Conditions. He is the Client's agent, employed to use his skill and knowledge to do what the Client himself chooses not to do, i.e. to report on, to design and to
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separate and distinct functions, namely, that of agent of the first defendant and
secondly, that of adjudicator in respect of the building contract, in which
capacity the second defendants were to hold the scales fairly between the
plaintiffs and the first defendant. As the plaintiffs have alleged, it was recorded
that there was no contract between themselves and the second defendants.
3. Clause 4.2, 221 in terms of which the second defendants were to exercise
reasonable skill, care and diligence.
4. Clause 4.6.1, 222 in terms of which the second defendants undertook the
responsibility of administering and inspecting the works.
5. Clause 4.6.3, 223 in terms of which the site staff were to be the second
administer the construction of the Works. In terms of The Contract between the Client
and the Contractor, he is the Engineer who has to act as the adjudicator and the
limitations of his powers in this respect are defined by the terms of The Contract. There
is no contract between the Consulting Engineer and the Contractor. The Consulting
Engineer is obliged to "hold the scales' fairly between the Client and the Contractor and
to act in accordance with the ethics and general practices of his profession.'
221 p 36, para 12.3, and p 534:
'4.2 The Consulting Engineer shall exercise all reasonable skill, care and diligence in the
discharge of the services agreed to be performed by him.'
222 p 36, para 12.4, and p 534:
'4.6.1 In connection with the work of the Contractor while it is in progress, the Consulting
Engineer shall be responsible for the contract administration and inspection of the
Works and, to this end, shall make visits to the site at such intervals appropriate to
the various stages of the construction as the Consulting Engineer deems necessary
in order to observe the progress and quality of the various aspects of the Contractor's
work. In addition, the Consulting Engineer shall arrange for the services of site staff to
assist him and to provide more continuous observation of such work.'
223 p 36, para 12.5, and p 534:
'4.6.3 The site staff shall be the Consulting Engineer's agents and act under the
Consulting Engineer's control. The duties and responsibilities of the site staff shall
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defendants' agents acting under their control.
6. Clause 4.7.1, 224 in terms of which the purpose of the second defendants' site
visits and representation by the site staff was specified. As appears from the
text of this provision, the purpose was essentially limited to the second
defendants' giving the first defendant greater confidence that the plaintiffs were
doing their job properly. The purpose did not extend to the second defendants'
supervising the plaintiffs' work in detail, nor having authority in respect of, or
accepting responsibility for, the manner in which the plaintiffs were performing
their obligations. The latter points are expressly made in clauses 4.7.2 and
4.7.3.225
be as laid down in the Conditions of Contract applicable to the Contract.'
224 pp 36 to 37, para 12.6, and p 535: 4.7.1 The purpose of the Consulting Engineer's site visits and representation by the site
staff at the site will be to enable the Consulting Engineer to carry out the duties and
responsibilities undertaken by him during the Construction Stage and, in addition, by
exercise of the Consulting Engineer's judgment as an experienced and qualified
design professional, to provide the Client with a greater degree of confidence that the
completed work of the Contractor will conform generally to the Contract documents
and that the integrity of the design concept as reflected in those documents, has been
implemented and preserved by the Contractor.'
225 at p 535:
'4.7.2
4.7.3
The Consulting Engineer does not, during such visits or as a result of such
observations of the Contractor's work in progress, supervise in detail the
Contractor's work, nor shall the Consulting Engineer have authority over or
responsibility for the means, methods, techniques, sequences or procedures of
construction or temporary works selected by the Contractor, for safety
precautions and programmes incidental to the work of the Contractor or for any
failure of the Contractor to comply with laws, rules, regulations, ordinances, codes
or orders which may be applicable to the Contractor's work.
Accordingly, the Consulting Engineer cannot ensure the performance of the
Contractor nor guarantee against any failure by the Contractor to perform his work
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7. Clause 11, in terms of which the second respondents were to provide their
services in four stages. 226
in accordance with the Contract or the Contract documents.'
226 pp 37 to 39, para's 12.7 to 12.11, and pp 538 to 542:
'Normal Services to be Performed by the Consulting Engineer
11. These services will be provided in four stages and shall include all or any of the following
subject to the Client's instructions to proceed and the fee for these services will be
subdivided as shown below. The fee for the Report Stage will be calculated on a time
basis as set out in Appendix B4 of Appendix B and the fee for the remaining stages
calculated in accordance with Appendix B1 of Appendix B. Unless agreed otherwise, fees
will become due as shown below.
11.1 Report Stage
11 .2 Preliminary Design Stage
Following the Client's instructions to proceed, the development of preliminary proposals,
or the basic planning of the Works, comprising all or any of the following: .
11 .2.1
11.2.4 Design of any process or system or refinement of the preliminary process
design, where such process design is a prerequisite for the design of the
Works.
11.2.5 Preparation of preliminary drawings, plans and estimates required for seeking
the approval of statutory authorities. ...
11.2.6 Consultation on technical matters with authorities and interested parties other
than those having rights or powers of sanction. ... 11.3 Design and Tender Stage
The preparation of all documents necessary to enable tenders for the Works to be
called for or for the Works to be otherwise placed by the Client, including all or any of
the following:
11.3.1
11.3.2 Preparation of designs, drawings, specifications and engineering schedules
of quantities. ...
11 .4 Construction Stage
The general administration and co-ordination of the execution of the Works in
accordance with The Contract including all or any of the following:
11.4.1 11.4.4 Preparation of any further plans, designs and drawings excluding shop details,
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The plaintiffs' averments common to all claims. including the claims in delict against
both defendants
[198] For present purposes, a summary of the plaintiffs' averments common to all
claims will suffice. The second defendants designed the permanent works. 227 In
11.4.8
which may be necessary for the execution of the Works, including bending
schedules in the case of reinforced concrete work. Checking Contractor's drawings of structures, plant, equipment and systems
for the Works for conformity with design requirements but excluding detailed
checking of manufacture and installation details for erection or installation fit
Advice to the Client on the alternative designs and tenders but excluding
detailed inspection, reviewing and checking of alternative designs and
drawings not prepared by the Consulting Engineer and submitted by any
Contractor or potential Contractor. ...
Co-ordinating and generally inspecting the execution of the Works for
compliance with the Contract at such intervals as the Consulting Engineer
may deem necessary.
11.4.5
11.4.6
11.5 Construction Stage Site Staff
11.5.1 The Consulting Engineer shall, insofar as he is able, appoint such site staff as
are necessary for the checking of setting-out, day-to-day inspection of
construction of the Works, measuring up work on site and agreeing quantities
with Contractors' representatives or, alternatively, shall nominate such staff
for appointment by the Client In either case, such staff shall take instructions
only from the Consulting Engineer or his authorized representative acting on
behalf of the Client. ...'
227 p 40, para 13.
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August 1997, the plaintiffs began the construction of the works in accordance with the
building contract and the drawings. 228 The second defendants' representative observed
the execution of the works, examined and tested materials and workmanship and .received
from the plaintiffs such information as he reasonably required. 229 The second defendants designed the launching nose (part of the temporary works), including its
cross-bracing and the connection of the launching nose to the first segment of the
bridge deck. Their design for this connection determined the positioning of the
temporary bearings on the abutments and the piers. 230
[199] The plaintiffs averments continue to the effect that, in late 1997 and early 1998,
they, acting in terms of GCC 16(11), 231 or Project Specification clause 2.2.4, 232 or
228 p 40, para 14.1.
229 p 40, para 14.2.
230 pp 40 to 41, para 15.
231 p 189: 'Engineer to approve Contractor's Designs and Drawings 16(11) If the Contract expressly provides for the preparation by the Contractor of designs
and details of any work to be supplied, he shall submit for approval by the
Engineer, in triplicate, a drawing giving full details, dimensions and particulars
together with all relevant information and erecting or operating instructions (if any)
and shall obtain the Engineer's written approval, which shall be given within a
reasonable time, before commencing the work.
When any such drawing has been approved by the Engineer, it shall not be
departed from in any way except with the written consent of the Engineer.'
232 pp 412 to 413, Project Specification:
'2.2.4 Bridge work'
[The first four paragraphs are descriptive. The final paragraph reads -]
'The contractor shall accept full responsibility for the design of all temporary work required
for the construction of the bridge, and shall submit full details thereof to the engineer for his
review and acceptance.'
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Project Specification B9104, 233 submitted various drawings relating to the design of the
temporary works to the second defendants for their approval. 234 The second
defendants approved the plaintiffs' designs and drawings and, in particular, in a letter
dated 13th May 1998, the second defendants expressly approved a list of drawings 'as
compatible with the design'. 235
[200] The plaintiffs allege further that on 6th July 1998, whilst the Injaka bridge was
under construction, it collapsed. 236 The second defendants issued an instruction in
terms of which work on the bridge was suspended. 237 On 25th August 1998, the second
defendants wrote to the plaintiffs, allowing the demolition and removal of the damaged
parts of the incomplete works. 238
233 p 497. So far as presently relevant, Project Specification B9104 provides: 'B9104 . LaunchingNose (a) Design and manufacture
The contractor shall submit his design for the launching nose to the engineer for approval as
soon as possible after the award of the tender. ...'
234 p 41, para 16.
235 pp 41 to 42, para 17; and pp 573 to 580. Some 80 drawings were on the list thus approved, 37 being specifically drawings relating to the Injaka bridge, 17 relating to the Mondi bridge, and the remainder
not specified as relating to either bridge. The Injaka bridge drawings included - 031 Connection details of launching nose at end of deck
033 G/A and details of launching nose and side guides
051 Details of bridge bearing system
236 p 42, para 19.
237 p 42, para 20.
238 p 43, para 21, and p 581. In their letter, the second defendants wrote: 'This is to confirm that we will not require any further site investigation of the collapsed structure or
testing of any components thereof and agree to the demolition and removal [of] the damaged works
subject to the markings left by the temporary bearings on the soffit of the deck section immediately
past Pier 2 be recorded. It is suggested that the outer limits of the bearings be highlighted, the
distance of the extremes dimensioned from the edge of the deck
-139
[201] The plaintiffs aver 'accordingly' that they had complied with their obligations in
terms of the building contract. 239
[202] Next, the plaintiffs aver that the second defendants had designed 'a
replacement bridge' in which they had modified the original design in two material
respects, being
1 . the reinforcement in the bottom slab of the concrete deck; and
2. the positioning of the temporary bearings under the bottom slab.
On the instructions of the second defendants the plaintiffs had built the new bridge. 240
The plaintiffs' allegations in Claim V relating to the legal duties owed to them by the
second defendants
Claim V(1) - Wronaful and negligent conduct
[203] The plaintiffs have made the following allegations of legal duties 'undertaken'
by the second defendants, and said to have been breached by them:
1. The plaintiffs allege that the second defendants 'undertook' the design of the
permanent works, and the co-ordination between the design of the permanent
works and the temporary works, so as to ensure that the Injaka bridge would
not collapse during construction and would be fit for its purpose. 241
Comment: This allegation of an undertaking (which, from its nature, cannot
and then photographed to clearly show all details. We also agree that the dimensions, strengths and quality of materials used in the permanent works of the collapsed structure are in accordance with the contract drawings and specifications.'
239 p 43, para 22. This averment is one that the second defendants have applied to strike out.
240 pp 43 to 44, para 23.
241 Particulars of claim, p 73, para 83.
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be anything other than a contractual obligation) can only be based on the
consultancy agreement between the first and second defendants, to which
the plaintiffs were not parties. The plaintiffs have made the consultancy
agreement a part of their case by annexing it to their particulars of claim. 242
They do not suggest that they were unaware of its contents at the time that
they concluded the building contract with the first defendant. The following
is provided expressly in the consultancy agreement:
'There is no contract between the Consulting Engineer [the second
defendants] and the Contractor [the plaintiffs].' 243
Therefore, the plaintiffs' allegation that the second defendants 'undertook'
certain obligations cannot relate to any contract between the plaintiffs and
the second defendants. It can only be based on the consultancy
agreement. 244
242 Particulars of claim, p 34, para 11, and pp 520 to 572.
243 p 534, clause 4.1.
244 The plaintiffs' allegations could plausibly be based on some or all of the following provisions in the consultancy agreement:
'4.2 The Consulting Engineer shall exercise all reasonable skill, care and diligence in the
discharge of the services agreed to be performed by him'; and
'11. NORMAL SERVICES TO BE PERFORMED BY THE CONSULTING ENGINEER
11.3 DESIGN AND TENDER STAGE
The preparation of all documents necessary to enable tenders for the Works to be
called for or for the Works to be otherwise placed by the Client, including all or any of
the following:
11.3.2 Preparation of designs, drawings, specifications and engineering schedules
of quantities. ...
11.4 CONSTRUCTION STAGE
The general administration and co-ordination of the execution of the Works in
accordance with The Contract including all or any of the following:
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2. The plaintiffs have gone on to allege: 245
'84. The second defendant in performing its obligations as the agent of the first
defendant in relation to the scrutiny and approval of the temporary works
drawings submitted by the plaintiff, assumed an obligation to ensure that:
84.1 the overall design of the works (for which the second defendant
alone was responsible) would not be compromised in any
way by the design and execution of the temporary works by
the plaintiff or by the design of the temporary works by the
second defendant; and/or
the integrity of the design concept would not be impaired or
compromised.'
84.2
Comment: Paragraph 84 is attacked in the exceptions, and it is also the
subject matter of the second defendants' application to strike out.
The allegation that the plaintiffs, as the agents of the first defendant,
'assumed' these obligations, is at first sight ambiguous. It could mean
simply that the second defendants, in entering into the consultancy
agreement with the first defendant, 'assumed' these obligations as a
matter of contract, and were to discharge them as the first defendant's
agents. The allegation would not then have any apparent relevance in
245 p 73.
11.4.4 Preparation of any further plans, designs and drawings excluding shop
details, which may be necessary for the execution of the Works, including
bending schedules in the case of reinforced concrete work.
Checking Contractor's drawings of structures, plant, equipment and systems
for the Works for conformity with design requirements but excluding detailed
checking of manufacture and installation details for erection or installation fit
Co-ordinating and generally inspecting the execution of the Works for
compliance with the Contract at such intervals as the Consulting Engineer
may deem necessary.'
11.4.5
11.4.8
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what is plainly intended to be a claim in delict against the second
defendants.
On the other hand, it could also carry the additional meaning, in the
context of the particulars of claim as a whole, that the second defendants
had not only a contractual obligation to the first defendant but also, as a
conclusion of law, that the second defendants, by entering into the
consultancy agreement with the first defendant, and by becoming the first
defendant's agents, 'assumed' a legal obligation in the terms set out,
based on Aquilian principles, owed to, and enforceable by, the plaintiffs.
In ordinary parlance, most people would probably prefer to express this
concept by saying that, having regard to the circumstances in question, the
law, on Aquilian principles, 'imposed' a legal duty on the second
defendants in favour of the plaintiffs, and not that the second defendants
'assumed' such a duty.
An exception that a pleading lacks averments necessary to set out a
cause of action or a defence, can only succeed if the pleading under
attack, given every meaning that it is reasonably capable of conveying,
lacks such averments. In my view, the allegation in paragraph 84 that the
second defendants 'assumed' the obligation in question, considered in its
context, is reasonably capable of bearing the interpretation that the second
defendants, in addition to undertaking a contractual obligation owed to the
first defendant, had no choice but to submit to the imposition by law of the
obligation alleged, as a legal duty owed to the plaintiffs, and it must be
given that interpretation for present purposes.
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Nor do I think that the ambiguity of paragraph 84 renders it vague and
embarrassing. Again, the context must be considered. The second
defendants had contracted with the first defendant in terms of the
consultancy agreement, and had embarked on the 'construction stage' of
that agreement. It involved their acting as agents of the first defendant and
interacting with the plaintiffs as the building contractor. Claim V is plainly
a claim in delict. When these circumstances are taken into account, it
seems to me to be clear enough that paragraph 84 must not be read as no
more than an allegation that the second defendants 'assumed' a
contractual obligation to the first defendant that is irrelevant to the plaintiffs'
claim in delict. It must be read and understood as an allegation to the
effect that the second defendants, acting as agents of the first defendant
in terms of the consultancy agreement, 'assumed' (in the sense of
'submitted to, because as a matter of law they had no choice') a legal duty
3.
that they owed to the plaintiffs in terms of the law of delict.
In paragraph 85.1, 246 the plaintiffs have alleged that the second defendants knew, or ought to have known, that the plaintiffs would rely on them to perform
certain specified tasks 'with reasonable skill, care and diligence'.
4. In paragraph 85.2, 247 the plaintiffs allege that it was foreseeable, and that the
second defendants did foresee, or ought to have foreseen, that if they did not
perform the obligations contemplated by paragraphs 84.1 and 85.1 with due
skill care and diligence, the Injaka bridge would be susceptible to collapse
246 pp 74 to 75.
247 p 75.
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during construction and that the plaintiffs would suffer consequential loss.
5. In paragraph 86, 248 the plaintiffs allege the steps that would have been taken
6.
by a reasonable engineer in the position of the second defendants.
In paragraph 87, 249 the plaintiffs allege a conclusion of law in the following terms:
'87 The second defendant, in the premises, owed the plaintiff a duty of care to
ensure that it discharged the second defendant's obligations and those
contemplated in paragraphs 84.1 and/or 85.1 above with reasonable skill,
care and diligence and to ensure that the Injaka bridge was not susceptible
to collapse and/or failure, during construction.'
This conclusion is the subject of attack in the exceptions.
7. In paragraph 88, 250 the plaintiffs make allegations that are based on
paragraph 49 of the particulars of claim. For reasons that I have set out above,
I consider the substance of their allegations to be that the second defendants
were responsible for what I have called the first and second design faults
referred to in paragraph 49; that the part played by the second defendants in
introducing and approving the design faults amounted to the breach by the
second defendants of the already-mentioned legal duty that they owed to the
plaintiffs (which constitutes an allegation of wrongfulness in the conduct of the
second defendants); and that the second defendants failed to take the steps
mentioned above that would have been taken by the reasonable engineer in
their position (constituting an allegation of negligence on the part of the second
defendants) .
248 p 75.
249 p 76.
250 p 77.
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8. In paragraph 89, 251 the plaintiffs allege that the second defendants' wrongful
and negligent conduct resulted in the collapse of the partly built Injaka bridge,
and in the plaintiffs' consequently suffering the losses totalling R36,035,936.22
detailed in schedule X4. 252
9. The plaintiffs therefore pray for judgment against the second defendants for
R40,973,345.64, including VAT.
[204 ] Paragraphs 84 to 89 of Claim V are all attacked in the exceptions, and they also
form the subject matter of the second defendants' application to strike out.
Claim V(2) - Alternative claim for wrongful and negligent misstatement
[205] In paragraph 91.1, 253 the plaintiffs allege in substance that the plaintiffs from
time to time submitted to the second defendants drawings relating to temporary works
for approval by the second defendants in terms of GCC 16(11) 254 and clauses 2.2.4
(Bridge work) 255 and B9104 (Launching nose) 256 of the Project Specifications; and that
the second defendants approved all such drawings, including in particular such of the
80 drawings listed in the annex to the second defendants' letter dated 13 May 1998 257
251 p 78.
252 pp 127 to 167.
253 p 79 254 p 189
255 pp 412 to 413
256 p 497
257 pp 573 to 580. Some 80 drawings have been listed, of which 39 have been identified as drawings relating to the Injaka bridge. Another 17 relate to the Mondi bridge, and the balance have not
specifically been identified as relating to either bridge. Most of the drawings listed do not appear to have
any relevance to the two design faults relied upon by the plaintiffs. The plaintiffs could, no doubt, have
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as related to the temporary works for the Injaka bridge, as being compatible with the
design of the permanent works.
[206] In paragraph 91.2, the plaintiffs refer back to paragraph 49 in which they had
alleged what I have called the two design faults for which they hold the second
defendants responsible. They allege in substance that, because of the two design
faults, none of their drawings relating to the temporary works and approved by the
second defendants was compatible with the design of the permanent works. This
allegation may well be too broad. For present purposes it must, in my view, be
understood as an allegation that such of the plaintiffs' drawings for temporary works as
have a bearing on either of the two design faults alleged by the plaintiffs, were
incompatible with the design for the permanent works ('the incompatible drawings').
[207] In paragraphs 92 and 93, 258 the plaintiffs allege in substance that the second
defendants, by approving the incompatible drawings, had made a misstatement to them;
that they had done so wrongfully (in breach of a legal duty not to make a misstatement);
and negligently (in the respect that they had failed to exercise reasonable care). The
plaintiffs' allegations proceed to the effect that the misstatement had resulted in
1. the plaintiffs' relying on the misstatement as if it were an accurate statement;
2. their attempting to build the bridge in accordance with the incompatible
drawings when, unbeknown to them, the attempt was doomed to failure because of the incompatibility of the drawings by reason of the two design
faults;
3. the collapse of the partly built bridge in the course of construction; and
specified precisely which of the drawings they rely on as relating to the two design faults they allege, but they
have chosen not to do so. No doubt it is a matter for evidence.
258 pp 79 to 81
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4. their sustaining losses totalling R36,035,936.22.
[208] On this alternative basis, the plaintiffs pray for the same relief as in Claim V(1).
Claim III: the alleged vicarious liability of the first defendant
[209] The plaintiffs stipulate the following in respect of Claim III:
'The claim in delict which is concurrent with Claims I and II and is restricted to those damages and/or losses not recovered under the said claims as entitlements, 259
Claim III consists of a main claim and an alternative claim. I refer to them as Claim III(1) and
Claim III(2), respectively.
Claim III(1): the first defendant's alleged vicarious liability for loss suffered by the .
plaintiffs as a result of the second defendants' alleged breach of their contractual dutyof skill. care and diligence owed to the first defendant
[210] As in Claim V(1), the plaintiffs start the particulars of Claim III(1) with allegations
relating to certain of the contractual obligations undertaken by the second defendants
in the consultancy agreement between the first and second defendants, to which the
plaintiffs were not a party. They allege:
1. that the first defendant appointed the second defendants as their agents to
design the permanent works and generally to administer the works; 26O
2. that the second defendants, as first defendant's agents, amongst other things
(1) prepared designs and drawings for the permanent works and the
259 p 64
260 p 64, para 62; p 35, para 12.1; Consultancy agreement, p 533, para 3.3.
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temporary works, including the Injaka bridge; 261
(2) were obliged to visit the construction site to observe the progress and
quality of the plaintiffs work; 262
(3) generally administered and co-ordinated the execution of the works in
accordance with the provisions of the building contract; 263
(4) was obliged to check and approve the plaintiffs' drawings of, amongst
other things, the temporary works
'for conformity with the design requirements to ensure that the integrity of the
design concept was implemented' 264
all of which were referred to in the particulars of claim collectively as 'the
second defendant's obligations'.
(Note: 'The second defendant's obligations' are again referred to in Claim V. 265)
[211] The plaintiffs allege further, in paragraph 64 of Claim III:
'64 The second defendant, in addition, undertook to discharge the second
defendant's obligations with reasonable skill, care and diligence.' 266
[212] In my judgment, there is no room for any uncertainty about the nature of this
alleged undertaking. The plaintiffs have plainly indicated that they are relying on the
261 p 65, para 63.1; p 38, para's 12.9 and 12.19; Consultancy agreement, p 540, para's 11.3.2 and 11.
4.4.
262 p 65, para 63.2; p 36, para 12.4; Consultancy agreement, p 534, para 4.6.1.
263 P 65, para 63.3; p 38, para 12.10; Consultancy agreement, pp 540 to 541, para 11.4.
264 p 65, para 63.4; pp 36 to 37, para 12.6 read with pp 38 to 39, para 12.10; Consultancy agreement,
p 547, para's 11.4.5 and 11.4.8.
265 p 76, para 87, where the plaintiffs allege that the second defendants owed the plaintiffs aduty of care to ensure that they discharged 'the second defendant's obligations' as well as certain
other obligations with reasonable care etc.
266 p 66, para 64; p 36, para 12.3; and Consultancy agreement, p 534, para 4.2.
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contractual undertaking of the exercise of reasonable skill, care and diligence that the
second defendants gave to the first defendant in the consultancy agreement to which
the plaintiffs were not parties. The allegation does not relate to any sort of assumption
by the second defendants of a non-contractual legal duty owed to the plaintiffs. [213] Claim III(1) proceeds with the following allegations
'65 The second defendant, in breach of the consultancy agreement, wrongfully
failed to perform the second defendant's obligations with reasonable skill,
care and diligence and was negligent in the performance thereof.
66 The performance by the second defendant of the second defendant's
obligations was:
66.1 specifically authorized by the first defendant; and/or
66.2 consequent upon the second defendant seeking to obtain the
result to which it was authorized by the first defendant, that is, the
design and construction, inter alia, of the Injaka bridge; and
wrongful and/or negligent for the reasons set forth mutatis
mutandis in paragraph 49 above.
67 The first defendant as a consequence of the consultancy agreement and the
appointment by it of the second defendant to act as its agent, is vicariously
liable for the negligent discharge by the second defendant of the second
defendant's obligations and the losses and/or damages sustained by the
plaintiff in consequence thereof, amounting to the sum of R36,035,936.22
as appears more fully from the schedule annexed hereto marked "X4".'
66;3
Claim III(1) does not contain any allegation, express or implied, to the effect that the
second defendants owed the plaintiffs any kind of legal duty at all. The only legal duties relied on in Claim III(1), and alleged to have been breached, are the contractual duties
owed by the second defendants to the first defendant in terms of the consultancy
agreement.
[214] The essence of what the plaintiffs have put forward as their cause of action in
Claim III(1) is that when, for the purposes of a particular construction project, an owner,
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0, engages a consulting engineer, E, in terms of a contract that obliges E to act as the
agent of 0, and to act with reasonable skill, care and diligence; when 0 also engages
a contractor, C, in terms of a separate building contract that obliges C to obey the
instructions of E; when E, acting as the agent of 0, breaches his contractual duty of
reasonable skill, care and diligence owed to 0, by giving instructions to C without due
skill, care and diligence; and when that breach of contract results in the collapse of the
partly built structure and also causes C to sustain a loss, one of the consequences is
said to be that, as a matter of law, 0 becomes vicariously liable to C for his loss.
[215] Claim III(1) does not contain any express allegation of facts and circumstances
to justify any conclusion that E had been under a legal duty to C to act with reasonable
care; that E had breached that duty and had therefore committed a wrongful and
negligent act against C; that E had accordingly become liable on Aquilian principles to
C for C's alleged patrimonial losses; and that as a result of the relationship between E
and 0, 0 was also liable, vicariously, to C for the same losses. On the contrary, Claim
III(1) is based on the simple proposition that when an agent, in the course of conducting
his principal's business, commits a breach of a contractual duty of care owed to his
principal in terms of the contract of agency, and when that breach of contract causes
financial loss to a third person who is not a party to the contract, the principal is .
vicariously liable to the third person for the latter's loss. Whether that proposition is
correct as a matter of law will have to be examined when I deal with the first defendant's
exception to Claim III(1).
Claim III(2): the first defendant's alleged vicarious liability for loss suffered by the
plaintiffs as a result of the second defendants' alleged wrongful and negligent breach
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of a legal duty that they are said to have owed to the plaintiffs. to refrain from making
such a misstatement
[216] The plaintiffs begin Claim III(2) with precisely the allegations relating to a
misstatement that the second defendants are said to have made to them wrongfully and
negligently, as have been repeated in Claim V(2). 267 I have already summarized the
allegations above. In Claim III(2), the plaintiffs proceed with the following further
allegations relating to the alleged vicarious liability of the first defendant for that conduct
on the part of the second plaintiffs:
'71 The performance by the second defendant of the second defendant's
obligations was:
71.1 specifically authorized by the first defendant; and/or
71.2 consequent upon the second defendant seeking to obtain the
result to which it was authorized by the first defendant, that is, the
design and construction, inter alia of the Injaka bridge; and wrongful
and negligent for the reasons set forth, mutatis mutandis, in
paragraph 49 above.
72 The first defendant, as a consequence of the consultancy agreement and the
appointment by it of the second defendant to act as its agent, is vicariously
liable for the representation made by the second defendant and the losses
and/or damages sustained by the plaintiff in consequence thereof in the
amount of R36,035,936.22 as set out in annexure "X4" hereto.'
71.3
[217] Having summarized the plaintiffs' claims, I turn now to certain questions that
are fundamental to the outcome of the defendants' exceptions.
Patrimonial loss
[218] On behalf of the second defendants, Mr Loxton submitted that the plaintiffs'
267 The allegations at pp 67 to 69 in paragraphs 68 to 70 of Claim III(2) are identical with the allegations at pp 79to 81 in paragraphs 91 to 93 of Claim V(2).
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particulars of claim show that they have valid claims in contract against the first
defendant for the very damages that they are claiming from the second defendants in
delict. Therefore, the submission continued,
'[the..plaintiff's] patrimony will not be diminished in consequence of the collapse of the bridge. Its obligation to rebuild the bridge will be offset by its concomitant right to receive payment.'
[219] This submission was made in support of the following points raised in the
second defendants' exception:
1. In paragraph 11, 268 after challenging the plaintiffs' allegation in Claim V(1) that
the second defendants owed them a duty of care, the exception continues:
'11. ... Alternatively, and in any event, the facts alleged by the Plaintiff do not give
rise to any claim for damages in respect of mere pecuniary or financial loss,
as claimed by the Plaintiff.'
2. In paragraph 17, 269 which challenges Claim V(2), the exception states more
specificalIy:
'17. In the absence of any allegation that the Plaintiff was precluded from
claiming from the First Defendant the fees and disbursements due to it
under the building contract for the rebuilding of the bridge, the Plaintiff
fails to establish that it has suffered a loss in consequence of the
collapse of the bridge as a result of the conduct of the Second
Defendant. '
[220] If the plaintiffs have indeed failed to make allegations that, if proved, will
establish a patrimonial loss caused by the conduct of the second defendants, the latters'
exceptions must succeed on that ground alone. The essence of counsel's submission
is that the plaintiffs' patrimony cannot have been diminished by the conduct attributed
268 p 677.
269 p 679.
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to the second defendants (i.e. by the two alleged errors of design, or by the alleged
misstatement that certain of the plaintiffs' drawings for temporary works were compatible
with the design for the permanent works) because the building contract places the risk
of such eventualities on the first defendant. In particular, GCC 35(1)(c) affords the
plaintiffs a remedy in the form of the right to repair and make good the damage and
physical loss to the partly built bridge, and to be paid by the first defendant for doing so;
GCC 45 affords the plaintiffs the right to an extension of time for completion of the
works and to payment of additional preliminary and general allowances; and the contract
in general both obliges and entitles the plaintiffs to complete the works, and also entitles
them to be paid for doing so. In the light of these contractual provisions for the payment
of the plaintiffs at rates agreed to by them in the contract, their allegations of having
suffered any patrimonial loss are idle, so I understand the submission.
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[221] The response made by Mr Klevansky on behalf of the plaintiffs may be
summarised in four sets of propositions:
1. The second defendants could not invoke the plaintiffs' rights in terms of the
building contract in support of the proposition that the plaintiffs had not
sustained any damage. The plaintiffs' only claim against the second
defendants was in delict. The building contract was a contract between the
plaintiffs and the first defendant alone. So far as the second defendants were
concerned, it was extraneous to the plaintiffs' cause of action - a transaction
between persons other than those concerned in the delictual cause of
action.27O In these circumstances, so the contention ran, the plaintiffs'
contractual claims against the first defendant were irrelevant to an assessment
of their damage for the purposes of their claim in delict against the second
defendants. In support of this submission, Mr Klevansky referred to the
decision of Nestadt J, concurred in by Boshoff AJP, in the matter of Botha v
Rondalia Versekeringskorporasie van Suid-Afrika Bpk 1978 (1) SA 996 (T).
2. Mr Klevansky submitted further that the plaintiffs had suffered a loss when the
bridge collapsed on 6th July 1998 because GCC 35(1)(a) left them with a
contractual obligation to build a 'second' bridge 'for nothing'. He contended
that the plaintiffs' books showed that they had incurred expenditure on
demolition, and no countervailing credit item or asset other than the existence
of a claim. (The plaintiffs' books are not part of their particulars of claim. I take
it that the last submission was based on an inference from schedules X2, X3
and X4, and the details attached thereto).
270 Res inter alios acta.
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3. Next, Mr Klevansky submitted that the second defendants' approach to this
question was one that would leave a logical problem in any case in which a
plaintiff is in a position to sue each of two wrongdoers for the full amount of his
. damages. If the second defendants' approach were correct, he suggested,
each defendant in every such case could point to the plaintiffs right of action
against the other defendant (assuming that the latter had the means to meet
the plaintiffs claim) and could contend that the existence in the plaintiffs
patrimony of a good claim against a defendant who could pay in full, left the
plaintiff with no patrimonial loss. The result would be that the plaintiff would be
unable to succeed against either defendant. That, Mr Klevansky contended,
was the logical error that was found to have been made in Holscher v ABSA
Bank en 'n Ander 1994 (2) SA 667 (T), at 673I-673D. It had finally been put
right in Nedcor Bank Ltd tla Nedbank v Lloyd-Gray Lithographers (Pty) Ltd
2000 (4) SA 915 (SCA), at 921D-G, in which the decision at first instance 271
had been upheld.
4. Finally, Mr Klevansky submitted that inasmuch as the plaintiffs' particulars of
claim contained an allegation that the second defendants had given a ruling
to the effect that the cause of the collapse of the bridge had been the plaintiffs'
own failure to perform their obligations in respect of the temporary works (and
not the 'design, specification or instruction' of the second defendants) and had
therefore rejected the plaintiffs' claims against the first defendant in terms of
the building contract, the second defendants could not be heard to say, in
these proceedings, that the plaintiffs had a valuable claim against the first
271 Lloyd-Gray Lithographers (Pty) Ltd v Nedcor Bank Ltd t/a Nedbank 1998 (2) SA 667 (W) at 674 G-675C.
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defendant in terms of the building contract. The plaintiffs' submission was
therefore, as I understand it, that the second defendants' suggestion that the
plaintiffs' particulars of claim disclosed that their patrimony comprehended the
value of their contractual claims against the first defendant, so that they had
suffered no patrimonial loss, could not be entertained because it was
inconsistent with the second defendants' own ruling to the contrary.
[222] I shall deal with each of these four sets of submissions in turn. First, is the
present matter governed by the principle in Botha v Rondalia?
The plaintiffs' submissions based on Botha v Rondalia Versekeringskorporasie van
Suid-Afrika Bpk 1978 (1) SA 996 (T)
[223] To ascertain the principle of the decision in Botha v Rondalia, it is necessary
to refer to the essential facts. A bank remained the owners of a car ('the car') that they
had sold, in terms of a hire-purchase contract, to one Smit. In terms of the contract, the
risk had passed to Smit and he had also undertaken to keep the car in good repair and
to indemnify the bank against any damage to it. As required by the contract, Smit had
insured the interests of himself and the bank in the car. The insurers were Rondalia.
In terms of the hire-purchase contract, Smit had been obliged to cede the insurance
policy to the bank. (Whether he had done so was not disclosed). When the car was
being driven by Smit's wife, it was involved in a collision with another vehicle driven by
one Botha, and damaged. It was common cause that negligence on the part of Botha
had been at least one of the causes of the damage to the car. The insurers, Rondalia,
honoured their obligations under the policy and paid the cost of the repair of the car.
It was agreed that the damages amounted to the sum of R440. Presuming that the
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bank, as the owners of the car, had a right of action in delict against Botha for the
damage to car caused by his negligence, the insurers took cession of the bank's right
of action, and sued Botha in the magistrate's court on the bank's cause of action. The
parties stated a case. The only issue was whether, as a matter of law, the bank had
enjoyed any right of action against Botha, or whether the purported cession of such a
right to the insurers (the plaintiffs) had been hollow. The magistrate held that the bank
had indeed enjoyed a right of action, that it had provided substantial subject matter for
the bank's cession to Rondalia and he accordingly granted judgment for Rondalia as
the plaintiffs. Botha appealed against the decision.
[224 ] The argument put forward on appeal accepted that, notwithstanding Smit's
obligation to the bank to keep the car in repair and to indemnify the bank against
damage, the bank, as owners, had indeed suffered damages through a reduction in the
value of their patrimony when the car had been damaged. However, so the submission
proceeded, once the car had been repaired and the insurers had paid the costs of
repair, the damage had been reinstated, the bank's patrimony was therefore no longer
diminished by the amount of the damage and, with that, any cause of action the bank
may initially have had against Botha, the wrongdoer, had come to an end. Therefore,
the submission concluded, by the time that the bank had purported to cede their claim
to the insurers, they had had no claim to cede, the purported cession had been hollow,
and the insurers, as cessionaries and plaintiffs, had not received any claim that they
could validly enforce against Botha.
[225] Nestadt J, delivering the judgment of the court, appears to have answered the
point by invoking the authorities supporting
'the general rule that the right to claim damages is established and must be
assessed as at the date of the wrong. Subsequent events unconnected therewith
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are disregarded.' 272
However, that general rule is not without exceptions, and the main decision in the
judgment turned on the question whether, in the particular circumstances of the case,
public policy required that the so-called 'collateral source. rule', should or should not beregarded as applicable. The learned judge stated the 'rule' in the following terms, in a
passage relied upon by Mr Klevansky for the present plaintiffs: 273
"'the rule that generally any compensation ... that the injured party receives from a collateral source, wholly independent of the wrongdoer or his insurer, does not operate to reduce the damages recoverable by him"
(per Trollip, J.A., in Santam Versekeringsmaatskappy Bpk v Byleveldt, 1973 (2) SA 146 (AD) at p 168). Thus a defendant in the situations referred to is generally not entitled to rely for his protection on a contractual arrangement between the plaintiff and a third party entitling the former to recoup his loss from the latter. Such right stems from an extraneous source which is regarded as legally irrelevant; it constitutes a case of res inter alios acta. According to Rumpff JA (as he then was), who gave the majority judgment in Byleveldt's case, the rule is based on considerations of equity, fairness and the interests of society (see pp 150 F and 153B-D).'
[226] As I understood Mr Klevansky's submission, it was that in the present case the
second defendants are attempting, in conflict with the collateral source rule, to rely for
their protection on a contractual arrangement (the building contract) between the
plaintiffs and a third party (the first defendant), entitling the plaintiffs to recoup their
losses from the latter. The plaintiffs' right of recoupment, counsel suggested, stems
from an extraneous source, is to be regarded as legally irrelevant and constitutes a
case of res inter alios acta. The further implication of this suggestion is that the
272 at 1004 D - F.
273 at 1000 A.
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application of the collateral source rule to the facts of the present case, accords with the
requirements of equity, fairness and the interests of society. To reach a conclusion on
the question whether these submissions are to be upheld, it is necessary to look further
into the decision in Botha v Rondalia.
[227] The submission for Botha, as the appellant, had been that the collateral source
rule ('the rule') was not applicable because its application would have led to
consequences contrary to public policy. The consequences of an application of the rule
would have been
1. In the proceedings instituted by Rondalia as cessionaries of the bank's alleged
claim against Botha, the bank's collateral sources of recovery would have to
be regarded as irrelevant. In particular, the bank's claim under the indemnity
given to them by Smit in terms of the hire-purchase contract would have to be
treated as irrelevant, and so too would the bank's right to indemnity under the
insurance policy to be taken out by Smit and ceded to the bank.
2. The result would be that the bank's claim would be enforced against
Botha despite the reinstatement of the car and the fact that the bank had
therefore suffered no loss.
3. Although Rondalia, as the insurers, had in fact sustained the loss, the bank,
who had not sustained any loss, would not be obliged to pay over to Rondalia
the amount that they, the bank, succeeded in recovering from the wrongdoer,
Botha.
4. Because Botha would not be ordered to pay the same claim twice, Smit's
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claim 274 against Botha would be empty, despite the fact that it was Smit who
had carried the risk of damage to the car and who had paid the insurance
premiums which had gained him the right to have the damage to the car
reinstated by Rondalia.
5. Rondalia, the insurers who had paid the insurance claim, who had therefore
suffered the loss, and who were entitled by subrogation to enforce Smit's
claim, would find themselves with an empty and unenforceable claim.
[228] It was suggested on behalf of Botha that such an anomalous state of affairs
was contrary to public policy and that the collateral source rule should not be applied
in a case in which it would bring about such a result. According to the argument, the
true legal solution would be to recognize that the bank had ceased to have a claim
when the damage to the car had been repaired; to allow the appeal and set aside the
magistrate's judgment; and to replace it with an order dismissing the claim of Rondalia
as cessionaries from the bank: the way would then be clear for Smit's claim against
Botha, to which Rondalia were entitled on the basis of subrogation, to be enforced by
them. The party that had truly sustained the loss would then recover it without the
wrongdoer's being required to pay twice and without the enrichment of the bank that
had suffered no loss.
[229] These submissions were not upheld by the court. The court accepted .275 the
authorities to the effect that the so-called collateral source 'rule' 'covers a wide
disputatious field in our law'; that 'it does not embrace a precise legal rule with a clearly
274 i.e. a claim enjoyed by Smit as the person who carried the risk of damage to the car and who was obliged to indemnify the bank, as owners of the car, against such damage: Smit v Saipem 1974 (4) SA 918 (A), at 932.
275 at 1001 E - F.
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defined field of operation'; and that it 'serves as a kind of ex post facto rationalisation
of a finding that a particular extraneous source of recoupment is to be regarded as
legally irrelevant to the plaintiffs claim for damages against the defendant'. 276
[230] The court nevertheless started from the premise that the proposition that an
extraneous source of recovery of a plaintiffs loss should be regarded as irrelevant to
the assessment of the plaintiffs damages for the purposes of his claim against the
particular defendant sued by him (i.e. the collateral source 'rule' should generally be
applied) unless the circumstances of the particular case reveal considerations justifying
the conclusion that public policy requires recognition that the extraneous source of
recovery is indeed relevant to an assessment of the plaintiffs damages, and that the
'rule' should therefore not be applied. 277
[231] In the course of considering the circumstances, the court took account of the
following 1. 'The mere fact that a plaintiff obtains double compensation does not justify a
departure from the application of the collateral source rule; it has to be and is
generally accepted as a fact of legal life. ' 278
2. 'It does not follow that, because a wrongdoer will not be made to pay twice, an
276 The learned authors of the title Damages in LAWSA, vol 7 (2nd ed,2005), at par 43, have made a collection of the situations in which, according to case law, extraneous benefits are to beignored as res inter alios acta, in accordance with the collateral source 'rule'; and of other situations inwhich certain benefits are to be brought into account, so that the 'rule' does not apply. Apart from thegeneral proposition that benefits resulting from charity or benevolence are usually irrelevant to the assessment of a plaintiffs damages, the subject does not easily lend itself to the formulation ofprinciples. The classification of particular benefits in one category or the other appears to be essentiallypragmatic and in some instances perhaps even arbitrary.
277 at 1001 H.
278 at 1003 B - C. In terms of the magistrate's judgment, the bank, as owners of the car, received a double benefit in that, first, the value of their car was restored at the cost of the insurers; and second, the bank's claim against the wrongdoer for payment of the damages was enforced by the magistrate's judgment (albeit that the judgment was in favour of cessionaries of the bank's claim.)
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injured party will necessarily not be permitted to recover twice.' 279
3. The fact that the plaintiff may have paid insurance premiums on a policy, or
- contributions to some other fund that constitutes the collateral source, is
irrelevant. 280
4. A plaintiff who is indemnified by insurance and who has a right of action
against a wrongdoer, does not stand to gain double compensation, once from
his insurers and once from the wrongdoer. When the insurers have paid his
claim under the policy, they become subrogated to his claim against the
wrongdoer. Anything that the plaintiff recovers from the wrongdoer, he is then
bound to hand over to the insurers. 281
5. The insurers, Rondalia, had been free, before taking on the risk, to protect
themselves against the claim that they would acquire from the insured being
empty by reason of the collateral source rule, but had not see fit to do so.
They could, for example, have stipulated at the outset - 282
(1) that the bank should undertake not to exercise their right to sue the
wrongdoer and to leave it to Smit to do so; or
(2) that the bank should undertake to cede their claim against the wrongdoer
to the insurer; or
(3) that the hire-purchaser, Smit, should warrant that the bank would give the
undertaking in (1) or the cession in (2) above.
279 at 1003 C - D.
280 at 1003 D - F.
281 at 1003 G.
282 at 1005 E -1006 A.
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6. The claim of the bank against the wrongdoer was not necessarily worth the
same as Smit's claim against the wrongdoer. Smit's claim might be subject to
apportionment on the grounds of contributory negligence on the part of his
driver, leaving it less valuable than the claim of the bank which could not be
reduced by apportionment.
[232] The court concluded that the appellant, Botha, had failed to show
considerations of public policy that would justify the court in declining to apply the
collateral source rule; that the rule was therefore to be applied; that the collateral benefit
that had accrued to the bank when Rondalia had paid for the repair of the car in terms
of the insurance policy was accordingly to be ignored for the purposes of the bank's
claim against the wrongdoer, Botha; that the bank had indeed had a valid claim for
damages against Botha; that the claim had been cedable; and that the magistrate had
rightly entered judgment for the cessionaries, Rondalia against Botha. Botha's appeal
was dismissed.
[233] I turn now to the application of the principles of Botha v Rondalia to the present
case. The suggestion that those principles demonstrate that, in the present case, the
collateral source rule precludes the conclusion that the plaintiffs, according to their own
allegations in the particulars of claim, have not sustained a patrimonial loss is, I think,
simplistic. There are at least three questions to be considered before such a conclusion
can properly be reached:
1. Having regard to the definition and description of the 'collateral source rule'
accepted and adopted in Botha v Rondalia at 1000 A-C and 1001 E-G, is the
building contract between the plaintiffs and the first defendant (or any remedy
available to the plaintiffs in terms of that contract) truly 'a collateral source,
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wholly independent of the wrongdoer or his insurer' (i.e. independent of the
second defendants or their insurer, if any)?
2. Is there justification for the suggestion that the building contract in the present
case is a source independent of the second defendants that is comparable
with or analogous to an insurance policy that the present plaintiffs might have
taken out covering the risk of harm caused by the second defendants?
3. On the basis that the collateral source rule must be applied unless there are
considerations showing that 'equity, fairness and the interests of society', and
public policy, require that it should not be regarded as applicable, are there any
such considerations?
I shall deal with each of these three questions in turn.
Is the building contract a collateral source. wholly independent of the wrongdoer?
[234] In my judgment, reasons that I shall set out under the following heads establish
that the building contract is not a collateral source, wholly independent of second
defendants as the alleged wrongdoers (or their insurer, if any):
1. The contents of the building contract.
2. The relationship between the three parties, seen in the light of Lillicrap.
The contents of the building contract:
[235] The analysis of the plaintiffs' claims essayed above, demonstrates the position
as clearly as I can. To recapitulate, the building contract was concluded between the
plaintiffs and the first defendant alone, and the second defendants are not party to it.
Nevertheless, in concluding the building contract, the plaintiffs agreed to subject
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themselves to the exercise of certain powers by the second defendants. 283 In return,
the first defendant exempted the plaintiffs from liability for 'damage or physical loss or
any other loss caused by... the design, specification or instruction of the [second
defendants] ...'. 284 Moreover, the first defendant accorded the plaintiffs certain rights
in respect of certain conduct on the part of the second defendants. In particular the
plaintiffs obtained the right - if damage or physical loss should be caused to the works
or the materials as a result of the design, specification or instruction of the second
defendants, and if the second defendants saw fit to order the plaintiffs to repair it and
make it good - to be paid for doing so, at rates agreed by the plaintiffs. 285 That the
plaintiffs had agreed to the rates indicates that they must have been rates that would
yield a reasonable profit if the plaintiffs worked reasonably efficiently in doing the extra
work of repairing and making good. In essence, therefore, such harmful conduct on the
part of the second defendants would reward the plaintiffs with additional profits.
[236] The building contract certainly did not create privity of contract between the
plaintiffs and the second defendants. Nevertheless, the fact that the plaintiffs agreed
in the building contract to place themselves under the orders of the second defendants,
and, if such orders resulted in damage or physical loss to the works or materials, to do
the necessary repairs (if so ordered by the second defendants) and to look to the first
defendant for compensation therefor, undoubtedly created a relationship between the
plaintiffs and the second defendants. It was a relationship that was at once close
(obedience to orders) and distant (compensation from the first defendant, without any
283 E.g. the plaintiffs agreed that, in carrying out their obligations under the building contract, they wouldcomply with the second defendants' instructions on any matter relating to the Works: GCC 6(3), p 183.
284 GCC 35(2)(j), at p 195.
285 GCC 35(1){c), at p 195.
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remedy against the second defendants).
[237] In these circumstances, it would in my view be an abuse of language to
describe the building contract, or the plaintiffs' remedy against the first defendant for
certain conduct of the second defendants causing damage or physical loss to the works
or the materials, as 'a collateral source, wholly independent of the wrongdoer or his
insurer' for purposes of the collateral source rule. The undoubted relationship between
the plaintiffs and the second defendants, although not amounting to privity of contract,
did not leave the plaintiffs wholly independent of the second defendants. It was only
because the plaintiffs accepted that relationship with the second defendants that they
enjoyed a right of recovery from the first defendant of the cost of repairing and making
good damage or physical loss to the works or materials caused by the second
defendants.
[238] For these reasons, the building contract alone demonstrates, in my judgment,
that the collateral source rule does not apply because it does not fit the description of
a source wholly independent of the alleged wrongdoer.
The relationship between the three parties. seen in the light of Lillicrap:
[239] The decision in Lillicrap 286 is a further strong pointer to the conclusion that the
building contract in the present case cannot properly be considered to be a collateral
source. The facts of Lillicrap were of course materially different. So far as relevant to
the present point, the facts were these. In July 1974, Lillicraps, a firm of consulting and
structural engineers, entered into a contract with Pilkingtons, glass manufacturers, who
required professional consulting engineering services for the purposes of the planning
286 Lillicrap, Wassenaar and Partners v Pilkington Brothers (SA) (Pty) Ltd 1985 (1) SA 475 (A).
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and construction of a glass-making plant. (This contract was the equivalent of the
'consultancy agreement' between the first defendant and the second defendants in the
present matter). The consultant engineering contract obliged Lillicraps to perform their
services with professional skill and care. One of the main questions that arose later
was whether Lillicraps were at the same time bound by a similar legal duty that was
independent of the consultant engineering contract and that arose in terms of the law
of delict. Pilkingtons alleged the existence of such a concurrent duty arising on Aquilian
principles, and the wrongful breach of the duty by Lillicraps during their performance of
the investigation and planning stages of the project, before the appointment of a
building contractor. The alleged breach of duty was said to have resulted in certain
damages to them ('the first damages').
[240] Before Pilkingtons were aware of the alleged-wrongful conduct of Lillicraps, the
time had arrived for the engagement of a building contractor. In March 1976, therefore,
Pilkingtons concluded a construction contract (the equivalent of the building contract in
the present matter) with a contracting company named Salanc Contractors (Pty) Ltd
('Salancs'). At the same time a tripartite deed of assignment was signed in terms of
which Pilkingtons, with the consent of Lillicraps, assigned all of their rights and duties
under the consultant engineering contract to Salancs, and further guaranteed that
Salancs would pay Lillicraps' fees in terms of the assigned contract. 287 Apart from this
guarantee, the assignment put an end to the privity of contract between Lillicraps and
Pilkingtons in March 1976.
[241 ] After the assignment in March 1976, therefore, the contractual arrangements
in Lillicrap were comparable with those in the present case:
287 The existence of this guarantee appears from the judgment of Margo J in the court of first instance:Pilkington Brothers (SA) (Pty) Ltd v Lillicrap,, Wassenaar and Partners 1983 (2) SA 157 (W).
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- Pilkingtons, as parties to the construction contract, were from March 1976 in
privity of contract with Salancs alone (and no longer with Lillicraps).
Pilkingtons were therefore in a position comparable with that of the present
plaintiffs, the latter being parties to the building contract and in privity with the
first defendant alone (but not with the second defendants).
- Salancs, who were parties to both the construction contract with Pilkingtons
and, by assignment, the consultant engineering contract with Lillicraps were
in privity of contract with both Pilkingtons and Lillicraps. Salancs were
therefore in a position comparable with that of the first defendant in the present
matter, he being in privity of contract with both the second defendants (in terms
of the consultancy agreement) and the plaintiffs (in terms of the building
contract).
- Lillicraps, who were in privity with Salancs alone from March 1976 (and no
longer with Pilkingtons) were then in a position comparable with that of the
present second defendants, the consultancy agreement having established
privity between the first and second defendants alone, and the latter having no
contract with the present plaintiffs.
[242] From March 1976, therefore, and in terms of the assigned consultant
engineering contract, Lillicraps owed the contractual duty to perform their services with
professional skill and care to Salancs and not to Pilkingtons. Nevertheless, Pilkingtons
later alleged that the assignment of Lillicraps' contractual duty of skill and care to
Salancs left unaffected Lillicraps' equivalent delictual duty of skill and care, owed to
Pilkingtons. They alleged further that Lillicraps had, after March 1976, committed
additional breaches of the latter duty and had caused Pilkingtons to sustain further
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damages ('the second damages').
[243] At a later stage Pilkingtons, their contractual remedies against Lillicraps for the
first damages, and against Salancs for the second damages, having become barred or
extinguished by prescription, sued Lillicraps in delict, on Aquilian principles, for both the first and the second damages. Lillicraps excepted on the ground that Pilkingtons'
allegations disclosed no cause of action in delict, either for the first damages said to
have been sustained during the period up to March 1976 when there was privity of
contract between them, or for the second damages said to have been suffered after the
privity of contract between them had been terminated by the assignment of the
consultant engineering contract from Pilkingtons to Salancs.
[244] At first instance, Margo J held that prior to March 1976, there had been one
item of Lillicraps' obligations under the contract in respect of which Pilkingtons'
allegations might have established a cause of action in contract, but that it did not
disclose one in delict; and that otherwise the plaintiffs' allegations sufficiently disclosed
a cause of action on Aquilian principles in delict, both before and after March 1976 .
He accordingly dismissed the exception, save only for upholding it in respect of the
single item I have referred to. 288 Lillicraps appealed to the Appellate Division, and
Pilkingtons cross-appealed against the upholding of the exception in respect of the
single item. Both the appeal and the cross-appeal succeeded.
[245] E Grosskopf AJA, delivering a judgment concurred in by three other members
of the court, Smuts AJA dissenting, held, so far as presently relevant:
1. that in principle our law recognizes the possibility of situations in which a
plaintiff may have concurrent causes of action, arising from the same facts,
288 Pilkington Brothers (SA) (Pty) Ltd v Lillicrap, Wassenaar and Partners 1983 (2) SA 157 (W).
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against the same defendant, for the same damages, both in contract and in
delict, but that this can occur only where the elements of delictual liability are
present independently of the contractual obligations; 289
2. that in respect of the period up to March 1976,while Pilkingtons were in privity
of contract with Lillicraps
(1) Pilkingtons' allegations of damage did not, on the particular facts set out,
amount to allegations of physical damage to corporeal property or of
personal injury, but were only allegations of pure economic loss; 290
(2) that Pilkingtons were therefore not assisted by any presumption that
Lillicraps, as the persons alleged to have caused the loss, had acted
wrongfully;
(3) that Pilkingtons had therefore needed to make allegations sufficient to
show that, in the particular circumstances of the case, the Aquilian
principles of the law of delict, applying the general criterion of
reasonableness, imposed a legal duty on Lillicraps, independently of the
consultant engineering contract, to act with professional skill and care, and
that Lillicraps had breached such duty;
(4) that inasmuch as there was no precedent covering the facts of the case, 291
save to the extent that Van Wyk v Lewis 292 threw light on the matter, the
court had to decide whether or not Aquilian principles stretched far enough
to justify the conclusion that Pilkingtons' allegations disclosed the
289 Lillicrap 1985 (1) SA 475 (A), at 496D-497B and 499A - I.
290 Lillicrap. 496 I; 497C-498C; 499D-E. 291 Lillicrap, 500A-B.
292 1924 AD 438.
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existence of such a legal duty, independently of the contract;
(5) that, for a number of reasons, Pilkingtons' allegations did not justify such
a conclusion. Amongst the reasons were
(a) the fact that the very existence of the consultant engineering contract
had afforded the parties the rights and associated remedies on which
they had agreed, so that there was no need for any conclusion that a
remedy was available, based on Aquilian principles extended into an
area to which such principles had not previously been applied;293
(b) that -
'the Aquilian action does not fit comfortably into a contractual setting
like the present. When parties enter into such a contract, they normally
regulate those features which they consider important for the purpose
of the relationship which they are creating. ... in general, contracting
parties contemplate that their contract should lay down the ambit of
their reciprocal rights and obligations. To that end they would define,
expressly or tacitly, the nature and quality of the performance required
from each party. If the Aquilian action were generally available for
defective performance of contractual obligations, a party's performance
would presumably have to be tested not only against the definition of
his duties in the contract, but also by applying the standard of the
bonus paterfamilias. How is the latter standard to be determined?
Could .it conceivably be higher or lower than the contractual one? If the
standard imposed by law differed in theory from the contractual one,
the result must surely be that the parties agreed to be bound by a
particular standard of care and thereby excluded any standard other
than the contractual one. ...' 294
293 Lillicrap, 500E-G.
294 Lillicrap, 500G - 501A.
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3. In respect of the period from the date of the assignment to Salancs in March
1976, when Pilkingtons and Lillicraps ceased to be in privity of contract with
each other, the learned judge held - 295
'Would these considerations fall away if the contract were assigned, as
happened in 1976? In my view the answer must be in the negative. The
relationship between the three parties is still one which has its origin in
contract. One must assume that their respective rights and obligations were
regulated to accord with their wishes, and that the contractual remedies which
would be available were those which the parties desired to have at their
disposal. The same arguments which militate against a delictual duty where the
parties are in a direct contractual relationship, apply in my view, to the situation
where the relationship is tripartite, namely that a delictual remedy is
unnecessary and that the parties should not be denied their reasonable
expectation that their reciprocal rights and obligations would be
regulated by their contractual arrangements and would not be circumvented by
the application of the law of delict.'
[246] It is a matter of considerable importance that, despite the absence of any
privity of contract between Pilkingtons and Lillicraps after the assignment in March 1976
(apart from Pilkingtons' guarantee of Lillicraps' fees, to which the learned judge did not
attach any significance) Grosskopf AJA identified a continuing tripartite 'relationship'
between Pilkingtons, Salancs and Lillicraps which he accepted as legally significant
regardless of the absence of privity of contract between Pilkingtons and Lillicraps.
[247] As I understand the legal significance of the tripartite relationship in which two
of the three parties were not directly linked by a contract, it may be explained as follows.
The three parties were to co-operate with each other for the purposes of a single
construction project. They had been free to conclude a single tripartite contract to
which all three were parties in a triangular arrangement defining the respective rights
295 Lillicrap, 502H-503A
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that each held against one or other or both of the other two, and the respective duties
that each owed to one or other or both of the other two. All three would then have been
in privity of contract with each other. However, as is usually the case in construction
contracts, the three parties concerned chose not to arrange their affairs in that way.
Instead of a triangular relationship, they chose to create a tripartite chain. From March
1976, Pilkingtons were linked to Salancs by the construction contract, and Salancs were
linked to Lillicraps by the assigned consultant engineering contract, but there was no
direct contractual link between Pilkingtons and Lillicraps relevant to the performance of
either of the two contracts (apart from Pilkingtons' guarantee that Salancs would pay
Lillicraps' fees). The contract of assignment establishes unmistakably that this
structuring of their tripartite relationship, with no privity of contract between two of the
parties, was intentional.
[248] The court evidently came to the conclusion that it could not infer that the
contractual link between Pilkingtons and Lillicraps had been severed in the expectation
that the law of delict would thenceforward regulate the rights and duties between the
two of them. On the contrary, the chain structure indicated that, if Pilkingtons were
dissatisfied with the work done for them, even if the faults were traceable to work done
by Lillicraps (particularly after March 1976), they (Pilkingtons) would have to look to
Salancs for such satisfaction as the terms of the construction contract provided, and
could not look directly to Lillicraps. If Salancs were liable to Pilkingtons, in terms of the
construction contract, for faulty work attributable to Lillicraps, Salancs would in turn
have to look to Lillicraps for satisfaction in terms of the consultant engineering contract.
[249] What this arrangement was found to preclude, was Pilkingtons' circumventing
the relevant contractual provisions by invoking the law of delict directly against Lillicraps
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in respect of work done by them after March 1976, and thereby defeating the parties'
reasonable expectations that their contractual arrangements would be adhered to. The
tripartite relationship in the form of a chain of contracts linking the three contracting
parties was of such a nature - so close, one might say - that it left no need, and indeed
no room, for any conclusion of law to the effect that Aquilian principles extended into
the relationship in the way contended for. Therefore, as I understand Lillicrap, the
existence of the chain of contracts led to the inferences, first, that the three parties
concerned had arranged the rights and obligations between the three of them, relating
to the project in which they were all engaged, as they wished them to be, and second,
that they had done so on the tacit assumption that their arrangements would not be
complicated by the unwanted extension of the principles of Aquilian liability into a field
that it had not previously been found to cover.
[250] There remains, in my view, room for this reservation: the decision in Lillicrap
does not necessarily exclude all possibility of delictual liability arising between two or
more of the parties to a chain of contracts such as the one in question in Lillicrap or in
the present matter. If, in a particular construction project regulated by such a chain of
contracts between three (and sometimes more) parties, the wrongful conduct of one of
them, acting intentionally or negligently, should cause patrimonial loss to another of
them, in a manner that is not regulated expressly or by implication by contract, it seems
to me that there must remain room for the application of Aquilian principles, or other
principles of the law of delict, to the extent that this can be done consistently with the
parties' contracts. After all, the law of delict effectively governs all wrongful conduct of
persons causing injury, loss or other harm, except to the extent that it is excluded or
superseded by criminal law, or by statute or by contract. Cases of pure economic loss
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are no exception, but they tend to produce differences of opinion over the question
whether the loss-causing conduct was wrongful.
[251] In the light of what I have set out above, l come to the conclusion that the legal
principles set out in Lillicrap show that, in the present matter, too, the chain of contracts
linking the second defendants with the first defendant (by means of the consultancy
agreement) and the first defendant with the plaintiffs (by means of the building contract)
for the purposes of a particular construction project, but creating no privity of contract
between the second defendants and the plaintiffs, establishes a tripartite chain
relationship similar to that in Lillicrap. It is true that the second defendants never had
a contract with the plaintiffs relating to this project, and that there has not been an
assignment to terminate any such previous contractual relationship. In my view, that
difference is not material. It is also true that neither the plaintiffs nor the second
defendants has guaranteed that the first defendant will pay the fees of the other of
them. That difference also seems to me to be immaterial.
[252] In my judgment, the tripartite chain relationship between the present parties
has the same legal significance as it had in Lillicrap: in both cases the parties
constructed their tripartite chain of contracts relating to a common project with the
intention that the provisions of the contracts would govern the relationship between
them so far as the terms of the contracts make provision for their respective rights and
duties. In particular, the present plaintiffs, for relief in respect of such conduct of the
second defendants as is regulated by the building contract, are limited to their
contractual remedies against the first defendant. It is the first defendant alone who has
contractual remedies against the second defendants for any harmful conduct on their
part that is regulated by the terms of the consultancy agreement. The only possibility
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that the plaintiffs may have a remedy against the second defendants based upon
Aquilian principles is if the plaintiffs' allegations reveal that the second defendants owed
the plaintiffs a non-contractual legal duty that is independent of the parties' two
contracts and not inconsistent with either contract, and that the second defendants
have conducted themselves in a manner that, without being regulated at all by the
contracts, is wrongful in that it breached the independent legal duty owed by the second
defendants to the plaintiffs, and that also caused the plaintiffs to sustain patrimonial
loss.
[253] On the basis of these conclusions, I come to a further conclusion relating to the
collateral source rule. The tripartite relationship involves a connection or relationship
between the plaintiffs and the second defendants that, though not amounting to privity
of contract, is nevertheless so close that, just as in Lillicrap after the cession, it
precludes the plaintiffs from enjoying a right to a remedy against the second defendants
based on Aquilian principles for any conduct on the part of the second defendants in
respect of which the plaintiffs have a contractual remedy against the first defendant by
virtue of the building contract. In these circumstances, it is fanciful to suggest, as the
plaintiffs have suggested in the context of Botha v Rondalia, that the plaintiffs'
contractual remedies against the first defendant, based on the alleged conduct of the
second defendants, constitute 'a collateral source, wholly independent of the wrongdoer
or his insurer'. On the contrary, it is as clear as it could be that the plaintiffs' contractual
remedy against the first defendant in terms of GCC 35(1)(c), far from being wholly
independent of the second defendants, as the alleged wrongdoers, is entirely
dependent upon the existence of the tripartite relationship to which the second
defendants are parties, and is also dependent upon the second defendants' having
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conducted themselves as alleged by the plaintiffs.
[254] To sum up, for the reasons I have given, I am of the opinion that, having regard
to the contents of the building contract and to the tripartite relationship between the
parties, seen in the light of Lillicrap, there is no sufficient justification for upholding the
submission on behalf of the plaintiffs that the plaintiffs' remedies against the first
defendant arising under the building contract, and as a result of the alleged conduct of
the second defendants, amount to 'a collateral source, wholly independent of the
wrongdoer or his insurer', for the purposes of the collateral source rule.
Is the building contract comparable or analogous to a policy of insurance taken out by
the plaintiffs for their own protection?
[255] For the submission that the plaintiffs' claims against the first defendant under
the building contract constituted res inter alios acta that could not be taken into account
for the purpose of determining whether the plaintiffs had sustained patrimonial loss as
a result of the delicts on the part of the second defendants alleged in claim V, Mr
Klevansky relied upon the passage in Botha v Rondalia that I have quoted above, 296
and in particular on the following general statement (which does not mention the
exceptions that undoubtedly exist):
'Thus a defendant in the situations referred to 297 is generally not entitled to rely for his protection on a contractual arrangement between the plaintiff and
a third party entitling the former to recoup his loss from the latter.'
A policy of insurance providing indemnity cover for a person in the position of the
296 1978 (1) SA 996 (T), at 1000 A-C.
297 i.e. a wrongdoer sued by a plaintiff whom he has injured and who has received some compensation from a collateral source, wholly independent of the wrongdoer or his insurer.
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plaintiffs is typical of the contractual arrangements of which this general proposition is
true. However, it is not true of all contractual arrangements that result in an injured
plaintiff receiving a benefit. For example, it is not true of medical benefits provided by a
medical scheme or employer who is bound by contract to allow such benefits. 298 Noris it true of a pension paid out to an injured person if he had a contractual right to such
pension as well as a disability pension. 299 In such cases, and others, the benefits
received by the injured plaintiff are not regarded as res inter alios acta, and they have
to be brought into account as reducing the patrimonial loss that he has sustained as a
result of the delict of the defendant wrongdoer.
[256] The situation in the present case is one that does not appear to be covered by
existing authority. It has therefore to be examined to determine whether or not the
. .
plaintiffs' contractual rights against the first defendant do or do not constitute res inter
alios acta and are or are not relevant to an assessment of the loss that the plaintiffs
claim to have sustained in consequence of the alleged delict of the second defendants.
For this purpose, it must be assumed that, as alleged by the plaintiffs, the second
defendants have acted wrongfully and negligently towards them, that the second
defendants' conduct caused the collapse of the bridge, and that the only remaining
enquiry is as to the loss thereby caused to the plaintiffs.
[257] On the basis of those assumptions, it is, in my judgment, apparent that the
plaintiffs' claim for damages in delict rests upon legal duties attributed to the second
defendants that cannot possibly be said to have arisen independently of the contractual
chain that, according to the plaintiffs' own allegations, binds the second defendants to
298 LAWSA, vol 7 (2nd ed, 2005), Damages, par 43; Serumela v S A Eagle Insurance Co Ltd 1981 (1) SA 391 (T).
299 LAWSA, vol 7 (2nd ed, 2005), par 43; Dippenaar v Shield Insurance Co Ltd 1979 (2) SA 904 (A).
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the first defendant and the first defendant to the plaintiffs for the purposes of the
common project in which they were all engaged. The building contract provides the
plaintiffs with remedies against the first defendant for the consequences of the conduct
that the plaintiffs have attributed to the second defendants. Such remedies constitute a valuable asset in the plaintiffs' patrimony. The value of such remedies cannot be said
to derive 'from a collateral source, wholly independent of the wrongdoer or his insurer.'.
[258] This contractual arrangement does not in any relevant way resemble an
insurance policy. A contract for indemnity insurance is essentially an arrangement
between a person who faces a risk and an insurer who, for a premium, and usually
without otherwise being involved in any enterprise in which the risk may eventuate and
cause a loss, undertakes to indemnify the person at risk wholly or partly for such loss.
Upon performance of the indemnity obligation, the insurer becomes subrogated to the
rights of the insured against the wrongdoer. There is no meaningful resemblance
between such a contract and the chain of contracts in the present matter. Certainly, the
parties recognized that the plaintiffs faced the risk that the design, specification or
instruction of the second defendants, which the plaintiffs were bound to obey and
execute, might result in damage or physical loss to the works or materials. The parties
made provision for that contingency in GCC 35(1)(c). Their provision was not in the
nature of indemnity insurance. It was a special contractual programme tailored to the
circumstances of such a building project. The plaintiffs agreed to undertake the
obligation to repair and make good such damage or physical loss if so ordered by the
second defendants. In return they gained the right to be paid for doing so at rates that
they were satisfied to accept and which would no doubt yield additional profit for the
additional work. The plaintiffs did not stipulate that the second defendants should be
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made answerable directly to them in contract. They were content to look to the first
defendant for their remedy. It was the second defendants who were to be answerable
to the first defendant in terms of the other contract in the chain. The plaintiffs were
content with this situation.
[259] Therefore, in my judgment, the provisions in the building contract that provide
the plaintiffs with their contractual claim against the first defendant for compensation for
repairing and making good damage and physical loss to the works and materials
caused by the design, specification or instruction of the second defendants (claim II(1),
and schedule X3, Part A), cannot properly be regarded as a matter arising between
other people, 300 and as a benefit accruing to the plaintiffs wholly independently of the
second defendants, such as would be the case with an indemnity payment received by
the plaintiffs in terms of an insurance policy that they had taken out to cover the risks
in question. It is apparent from the tripartite relationship based on the two relevant
contracts that, if the first defendant is liable to the plaintiffs on the contractual grounds
alleged, the second defendants will be liable to the first defendant to the extent agreed
in the consultancy agreement. Accordingly, the provisions of the building contract relied
on by the plaintiffs cannot be regarded as irrelevant to the proper assessment of the
damages that the plaintiffs allege in claim V that they have sustained at the hands of
the second defendants. The same applies to the provisions in the building contract that
provide the plaintiffs with their other contractual claims against the first defendant in
terms of the building contract, namely, claim I for the amount in schedule X2; claim II(1)
for the amount in schedule X3, Part B; and claim II(2) for the amount in schedule X3,
Part A.
300 Res inter alios acta.
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Equitv. fairness. the interests of society and public policy
[260] On the approach in Botha v Rondalia, if the injured party receives
compensation 'from a collateral source, wholly independent of the wrongdoer or his
insurer', the collateral source rule must be applied unless there are sufficient grounds
for not applying it. The rule accordingly excludes such compensation from the
assessment of the injured party's damages unless 'equity, fairness and the interests of
society', which in this context are aspects of public or legal policy, require that such
collateral compensation should indeed be brought into account as reducing the
damages for which the defendant is liable. In my view, while the identification of a
collateral source that is wholly independent of the wrongdoer or his insurer is in some
. circumstances simple and obvious, that is not entirely the position in the present case,
and considerations of legal policy also enter into the determination of the question
whether the source of the plaintiffs' compensation (the building contract) is or is not to
be regarded as such a wholly independent collateral source.
[261] In Lillicrap, 301 one of the questions dealt with was the concept of the 'general
criterion of reasonableness' according to which the existence or otherwise of a legal
duty is to be determined for the purposes of Aquilian liability. As was said by Grosskopf
AJA,302 :
'This criterion of reasonableness involves policy considerations.'
The policy considerations found relevant to the general criterion of reasonableness and
the question of legal duty in Lillicrap also have to an appreciable extent a bearing, in my
301 Lillicrap, at 498G - 499B.
302 Lillicrap, at 498H-1.
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view, on the question whether the present case is one for the application of the
collateral source rule, including the question whether the building contract is to be
regarded as a wholly independent collateral source within the meaning of the rule. I turn
first to some of the considerations of legal policy found relevant, in Lillicrap, to the
question of a legal duty or its absence. I shall then indicate the extent to which I
consider that similar considerations apply to the question whether the collateral source
rule should or should not be regarded as applicable to the assessment of the plaintiffs'
alleged losses said to result from the wrongful conduct of the second defendants as set
out in claim V.
[262] The policy considerations taken into account in Lillicrap may be summarized
as follows:
. .
1. The existence of a contract between between Pilkingtons and Lillicraps up to
March 1976, and thereafter the tripartite contractual chain linking Pilkingtons,
Salancs and Lillicraps in a common enterprise, was a consideration pointing
to the absence of any additional independent legal duty owed by Lillicraps to
Pilkingtons. 303
2. The absence of any need, while the contract between Pilkingtons and Lillicraps
provided them with the remedies that they had agreed upon, for an extension
of the already recognized ambit of Aquilian liability, was also a factor that
negatived the recognition of any additional legal duty independent of the
contract. 304
3. When the assignment terminated the privity of contract between Pilkingtons
303 Lillicrap, at 499A-B.
304 Lillicrap, at 500F-G.
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and Lillicraps, and when Salancs were introduced into a tripartite relationship
with two contracts linking the three parties for purposes of a common
enterprise, the same considerations applied. The situation remained that each
of the parties had available the contractual remedies that they desired, and
there was no need for a delictual remedy that had not previously been
recognized. 305
4. The recognition of a legal duty defined according to Aquilian principles and
superimposed on the contractual duties defined by the parties' agreement,
would tend to produce inconsistencies in certain respects that would not be
conveniently reconcilable with each other: 306
(1) The parties to such contracts normally regulate those features that they
consider important. for the purpose of the relationship that they are
creating, and contemplate that their contracts lay down the ambit of their
reciprocal rights and obligations. They define, expressly or tacitly, the
nature and quality of the performance required from each party.
(2) The recognition of an additional legal duty on Aquilian principles would
create the problem of identifying the standard of performance required.
Amongst the questions that would arise would be whether the standard of
performance required of a party
(a) remained the contractually defined standard; or
(b) became the objective standard of the reasonable person in the
position of the party in question; or
305 Lillicrap, at 502H - 503A.
300 Lillicrap, at 500G - 501G.
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(c) was to be determined on the basis that the reasonable person would
adhere to the contractually defined standard, so that the law of delict
was in effect invoked merely to reinforce the law of contract; or
(d) required the resolution of an ambiguity by reference to surrounding
circumstances in any case in which the contractually defined standard
appeared to differ from the objective standard of the reasonable
person.
(3) There does not appear to be any consideration of legal policy to justify
invoking the law of delict merely to reinforce the law of contract.
(4) That the delictual standard of culpa or fault should be governed by the
parties' agreement would be anomalous.
(5) To superimpose a legal duty on Aquilian principles on the parties' own
contractual arrangements would tend to interfere, in many cases, with
other aspects of the parties' contracts. Amongst other aspects, the
recognition of an Aquilian action additional to the remedies contemplated
by the parties' in their contracts may prove to be inconsistent with
(a) contractual extensions or limitations of liability;
(b) conventional penalties;
(c) indemnities;
(d) a provision for arbitration or other forms of dispute resolution
alternative to legal proceedings.
(6) The fact that contracting parties are free to incorporate in their contract a
provision expressly excluding delictual liability does not provide a
convincing reason for recognising the existence of a legal duty on Aquilian
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principles in a situation to which it has not previously been applied . To do
so would be to introduce an unwanted liability which, unless excluded by
contract, would provide a trap for the unwary.
[263] As I shall indicate below, I consider that similar or related policy considerations
justify the conclusion that, in the present matter, no relevant legal duty derived from
Aquilian principles was imposed by law on either the first defendant or the second
defendants. The reason is essentially that the tripartite relationship between the two
defendants and the plaintiffs was regulated by the two contracts that linked the three
parties in a common project. However, I am at present concerned with the question of
the plaintiffs' alleged patrimonial loss. This question can only be approached on the
basis of an assumption that an Aquilian duty did bind the second defendants, and that
they breached it as alleged, and that the question now is whether or not legal policy
requires that the so-called collateral source rule should or should not be applied in
respect of the plaintiffs' contractual remedies. In other words, assuming the elements
of the delict alleged in claim V, other than the damages as claimed, must the value of
the plaintiffs' contractual rights of recovery against the first defendant be brought into
account in the assessment of the damages claimed by the plaintiffs from the second
defendants in terms of claim V?
[264] On that assumption, it seems to me that considerations of legal policy broadly
similar to, and congruent with, those identified in Lillicrap support the conclusions that
1. the tripartite contractual chain linking the plaintiffs, the first defendant and the
second defendants in a common enterprise, on terms that they considered to
be in their own best interests and were able to agree, is a substantial factor
pointing to the conclusion that the plaintiffs' contractual rights of action against
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the first defendant cannot be classified as a collateral source independent of
the second defendants as the alleged wrongdoers. It is also a factor that in
any event requires that the collateral source rule should not be regarded as
applicable to the facts alleged in the particulars of claim. The value of the
plaintiffs' claims against the first defendant goes to increase the plaintiffs'
patrimony. No grounds of justification, other than the existence of the
imprecise and sometimes arbitrary 'collateral source rule' itself, have been
advanced for regarding that patrimonial asset of the plaintiffs as irrelevant res
inter alios acta for purposes of the assessment of the amount of the plaintiffs'
delictual claim against the second defendants.
2. In the face of the tripartite relationship established by the parties' two contracts
relating to the same project, and the remedies that the parties have been
willing to agree upon, it would not be fair or equitable to apply the collateral
source rule so as to impose on the second defendants a liability for the
damages claimed by the plaintiffs without bringing into account the value in the
plaintiffs' patrimony of the plaintiffs' contractual claims against the first
defendant.
3. The first defendant has his contractual remedies against the second
defendants in terms of the consultancy agreement. The interests of society
seem to me to demand that an offsetting, against the plaintiffs' claim against
the second defendants, of the value of the plaintiffs' claims against the first
defendant, which is obviously fair and just in the circumstances of this case,
should not be frustrated by the application of the collateral source rule.
4. That Aquilian liability may be extended to the facts of the present case (in
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accordance with the assumption that underlies the present discussion), would
not be a good reason for concluding that, as was found to be the position in the
entirely different circumstances of Botha v Rondalia, there are no grounds of
. .
legal policy for holding that the collateral source rule is inapplicable. On the
contrary, in the circumstances of the present case there are indeed grounds
of legal policy for holding that the rule is inapplicable. The most important
grounds are
(1) the application of the rule would be inconsistent with the parties'
contractual arrangements which are to the effect that the plaintiffs would
have to look to the first defendant in terms of the building contract for relief
from the consequences of the conduct of the second defendants
complained of by the plaintiffs, and that the first defendant would have to
look to the second defendants in terms of the consultancy agreement;
(2) the collateral source rule threatens to interfere with these contractual
arrangements;
(3) it would be inequitable and unfair to allow it to do so; and
(4) the interests of society in the upholding of the fundamental principle that
contracts must be observed, 307 therefore demand that the collateral
source rule should be regarded as inapplicable.
[265] For all of the reasons set out above, I cannot uphold Mr Klevansky's
submission to the effect that the collateral source rule precludes the offsetting, against
the damages claimed by the plaintiffs from the second defendants in claim V, of the
value of such of the plaintiffs' contractual claims against the first defendants as are
'JfJ7 Pacta servanda sunt.
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based on the conduct of the second defendants that is also complained of in claim V.
I hold that there are good reasons for concluding that the collateral source rule is not
applicable.
The submission that the plaintiffs had been obliged by the building contract to build a
second Iniaka bridge 'for nothing'
[266] What this submission was presumably intended to convey was that the
plaintiffs have not yet been paid the full amount that they consider that the building
contract entitles them to. Otherwise, I consider it to be self-evident that there was no
substance in the submission. It is quite clear that, assuming the correctness of the
plaintiffs' allegation that the collapse of the bridge was caused by the conduct they have
attributed to the second defendants, the building contract affords them remedies against
the first defendant for the extension of time, the payment of additional preliminary and
general costs, the payment of the costs of repairing and making good the damage to
the partly completed works and the loss of materials in the damaged parts that had to
be disposed of, and payment for the completion of the bridge in accordance with the
amended design, including additional amounts for extra work necessitated by the
variations in design.
The 'logical problem' in determining the patrimonial loss of the plaintiff if it is to be
reduced bv the value of other claims for the same loss
[267] Mr Klevansky submitted that the second defendants, in contending that the
plaintiffs had sustained no patrimonial loss because the value of their contractual claims
against the first defendant had to be set off against their delictual claim against the
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second defendants, faced an irresoluble logical problem, and that they were in fact
making the same mistake as had been found to have been made by the court in
Holscher v ABSA Bank en 'n Ander 1994 (2) SA 667 (T). The mistake had been
identified and put right in Nedcor Bank Ltd t/a Nedbankv Lloyd-Gray Lithographers (Pty) Ltd
2000 (4) SA 915 (SCA), at 921D-G, in which the decision at first instance 308 had been upheld.
[268] In Holscher, the Fedhasa Pension Fund had drawn a cheque for R32,848.96
on the Standard Bank, had made it payable to 'SA Mutual RAF, crossed it, marked it
'Not transferable', and issued it to one Hamman as the agent of Holscher, the plaintiff,
to invest the proceeds with the Old Mutual. The plaintiff was found to have become the
true owner of the cheque. Instead of performing his mandate for the plaintiff, Hamman
had stolen the cheque and had deposited it at a branch of Trust bank (a trading name
for ABSA bank, the defendants) for credit to the account of a broking company,
'Duerka', of which Hamman was the sole beneficial shareholder and the managing
director. Although Duerka was not the named payee, the defendant bank had
negligently collected the amount of the cheque from Standard Bank for Duerka and had
credited the latter's account with the proceeds. The plaintiff had evidently been unable
to find Hamman and did not join him as a defendant in the proceedings although it is
evident that he was also a wrongdoer who had caused the plaintiffs loss. The plaintiff
sued the defendant bank for wrongfully and negligently causing him loss in the amount
of the stolen cheque. He joined the Old Mutual as second defendants merely to give
them notice and without seeking any relief against them. He did not join Duerka as a
defendant although Duerka was plainly a joint wrongdoer with Hamman, and Duerka
3re Lloyd-Gray Lithographers (Pty) Ltd v Nedcor Bank Ltd t/a Nedbank 1998 (2) SA 667 (W), at 674 G 675 C.
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and Hamman together were concurrent wrongdoers with the bank. Nor did the bank
join either Hamman or Duerka as third parties. If Hamman, Duerka and the bank had
all been joined, all three would have been 'joint wrongdoers' for the purposes of the
Apportionment of Damages Act 34 of 1956, and liability for the plaintiffs' damages could
have been apportioned between them in terms of the Act. However, the Act was not
invoked and was therefore not applicable.
[269] It appeared from the evidence that Hamman had at some stage obtained an
order for the winding-up of Duerka on the grounds that it could not pay its debts. It also
appeared that if the plaintiff had proved a claim in the winding-up, he would have
received a liquidation dividend. Van Dijkhorst J held that, although the plaintiff could
have sued the thief for the full amount of the stolen cheque, he had the onus, in his
claim against the bank for wrongful negligence, of proving, in any of various ways
recognized in case law, the amount of his patrimonial loss. The starting point for the
assessment of the loss could well be the amount of the cheque. However, if there was
evidence to show that the actual loss was smaller, it had to be taken into account. No
information was available on whether anything could be recovered from the thief,
Hamman, and so no reduction of the calculation of the plaintiffs loss could be made on
that account. However, there was some evidence relating to the probable dividend that
would have been paid to the plaintiff if he had proved a claim in the liquidation of
Duerka. Citing Mouton v Die Mynwerkersunie 1977 (1) SA 119 (A) at 147D and 148A-
B, the learned judge held that it was up to the court to assess the probable yield if the
plaintiff had indeed proved such a claim, and to bring it into account in assessing the
damages sustained by the plaintiff as a result of the negligence of the bank. He
assessed the value of the probable liquidation dividend as R2,400 and he entered
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judgment for the plaintiff for R30,488.96 (being the amount of the stolen cheque, less
the probable liquidation dividend) and costs. This was not an apportionment in terms
of Act 34 of 1956. As neither of the two joint wrongdoers additional to the bank had
been joined in the proceedings, Act 34 of 1956 had not been invoked and was therefore
not applicable.
[270] Mouton v Die Mynwerkersunie 309 was a case in which an attorney, the
defendant, had been instructed by the plaintiff union to ensure that they could lend
funds to one Grundlingh, safe in the knowledge that repayment had been secured by
suretyships from an organization that was duly empowered to sign them. In the end,
Grundlingh proved to be unable to repay the loans and, his estate being insolvent, it
was sequestrated. It was found that the putative surety had not had the authority or the
capacity to sign the suretyship documents and that such documents had consequently
been null and void from the outset. The plaintiff union sued the defendant attorney for
damages. The defendant was found to have caused them loss wrongfully and
negligently as a result of his negligent failure to establish the incapacity or lack of
authority of the organization in question to undertake the liability of a surety. There was
evidence showing that, depending on the outcome of certain incomplete litigation in
which the liquidator of the insolvent estate of Grundlingh was engaged, the plaintiff
union could, on proof of their claim, expect to recover a liquidation dividend that could
be as high as 20% but might also turn out to be negligible. It was held, on appeal, that
it had been for the trial court to make an assessment, on the basis of the available
evidence, of the liquidation dividend likely to accrue to the plaintiff union, and to bring
it into account in determining the amount of the damages sustained by the plaintiffs in
309 1977 (1) SA 119 (A).
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consequence of the defendant's wrongful and negligent conduct. The judges of the
Appellate Division themselves performed this exercise and reduced the amount of the
damages awarded in the judgment of the trial court by the amount at which they
assessed the liquidation dividend likely to accrue to the plaintiff union. There was no
question of the applicability of the Apportionment of Damages Act 34 of 1956.
Grundlingh was evidently liable to the plaintiff union in terms of the contract of loan.
There was no suggestion that he was also liable to them in delict. However, the
recoverable part of his contractual debt had to be brought into account in determining
the patrimonial loss suffered by the plaintiff union for which the negligent attorney was
to be held liable in delict.
[271] In Lloyd-Gray Lithographers (Pty) Ltd v Nedcor Bank Ltd t/a Nedbank 310 the
facts were not materially different from those in Holscher, but Boruchowitz J was of the
opinion that the decision in Holscher to reduce the plaintiff's damages by the amount
of the dividend that he could have obtained by proving a claim in the winding-up of
Duerka had been wrong. He indicated that in Holscher the court ought to have
recognized that, in terms of the common law, the dishonest thief, Hamman, and his alter
ego, the company Duerka, had been joint wrongdoers so that each of them had been
liable in solidum, for the full amount of the loss without regard to the value of the right
of action against the other. The court should further have recognized that the negligent
bank had been a concurrent wrongdoer also causing the same damage as the two joint
wrongdoers, and that the bank had therefore similarly been liable in solidum, without
regard to the value of the claims against the other wrongdoers. Moreover, the court
should have recognized that, in terms of s 2(1) of the Apportionment of Damages Act,
310 1998 (2) SA 667(W).
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34 of 1956, the plaintiff, Holscher, could properly have alleged that Hamman, Duerka
and the defendant bank were 'joint' wrongdoers, and could have sued them all in the
same action (at any rate before the order for the winding-up of Duerka was made). The
court could then, in terms of s 2(8)(i), have ordered that the joint wrongdoers pay the
amount of the damages jointly and severally, one paying, the other to be absolved.
There would have been no question of reducing the amount of the judgment against the
defendant bank by the amount of the dividend recoverable by Holscher in the winding
up of Duerka.
[272] Boruchowitz J applied this view of the law to the facts of Lloyd-Gray
Lithographers. The plaintiffs were the true owners of certain cheques drawn in their
favour, crossed and marked 'restrictively'. One Stergiopoulos ('the thief) came into
possession of the cheques and wrongfully deposited them with Nedbank ('the defendant
bank') for collection and credit of the proceeds to an account in a name other than that
of the plaintiffs as named payees. The defendant bank wrongfully and negligently
carried out this mandate. The drawee banks honoured the cheques in circumstances
that did not render them liable to the plaintiffs. The cheques and the underlying debts
that the cheques had been issued to pay, were therefore all discharged. The thief
misappropriated the proceeds. The plaintiffs sued the defendant bank alone and
without joining the thief as a joint or concurrent wrongdoer. It was nevertheless
conceded that the thief had in fact been in a position to pay the amount of the cheques
to the plaintiffs in full. The court was asked to give answers to certain questions, the
first two of which were whether the plaintiffs' claim against the thief was a 'relevant'
asset in the plaintiffs' estate; and if so, whether the plaintiffs' claim against the
defendant bank was to be reduced by the value of their claim against the thief (who
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could pay it in full). On the strength of the reasoning already referred to, and despite
the fact that the plaintiffs had not made use of s 2(1) of Act 34 of 1956 to join the thief
in the proceedings, so that they were in no position to ask for judgment against the joint
wrongdoers jointly and severally in terms of s 2(8), Boruchowitz J answered both questions in the negative: the plaintiffs' claim against the thief was not a 'relevant' asset
in the plaintiffs' estate; and the plaintiffs' claim against the defendant bank was not to
be reduced by the value of their claim against the thief.
[273] The decision was taken on appeal to the Appellate Division. 311 Scott JA,
delivering the judgment of the court, and approaching the matter in a somewhat
different way from the approach of the court below, assumed that Act 34 of 1956 was
not applicable. On the basis of that assumption, the learned judge held that in terms
of the common law, the defendant bank and the thief were in any event each liable to
the plaintiffs for the full amount of the loss in solidum, and that whichever wrongdoer the
plaintiffs sued ('the selected defendant') could not rely on the value of the plaintiffs'
claim against the other wrongdoer as a factor that reduced the amount to which the
plaintiffs were entitled to proceed against the selected defendant. If it were otherwise,
the plaintiffs would be deprived of a remedy because of the logical, but insupportable,
result that each wrongdoer could raise as a defence the proposition that the plaintiffs,
having a valuable remedy against the other wrongdoer, had suffered no patrimonial
loss.
[274] It would appear that, if Act 34 of 1956 had been made applicable (by joining the
thief as a defendant), the court would a fortiori have been entitled to enter judgment for
the plaintiffs for the full amount of the stolen cheques, against both wrongdoers jointly
311 Nedcor Bank Ltd t/a Nedbank v Lloyd-Gray Lithographers (Pty) Ltd 2000 (4) SA 915 (SCA).
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and severally, one paying the other to be absolved, in terms of s 2(8)(a)(i). In that
event, if one of the wrongdoers had asked for an apportionment of liability as between
the wrongdoers, the court could have ordered it in terms of s 2(8)(a)(iii), thereby not
affecting the in solidum liability of either wrongdoer to the plaintiffs in terms of the
judgment, but determining the contribution that one wrongdoer, after paying the plaintiffs
more than his apportioned share of the judgment debt, could recover from the other.
[275] It is relevant to note that in terms of Act 34 of 1956 the court, in formulating the
judgment in favour of the plaintiff, is not obliged to enter judgment against joint
wrongdoers 'jointly and severally, one paying the others to be absolved'. This is so
despite the common law provisions that render both joint and concurrent wrongdoers
liable severally in solidum (each for the full amount of the plaintiff's damages), as well
as jointly (each for his proportionate share). 312 S 2(1) of Act 34 of 1956 permits the
joinder in one action of persons who are 'alleged' to be jointly or severally liable to the
plaintiff, irrespective whether they are or are not so liable, and all are referred to in the
Act as 'joint wrongdoers', whether they are known to the common law as concurrent
wrongdoers or as joint wrongdoers.
[276] S 2(8)(a)(ii) affords the court the discretionary power, if it is satisfied that all the
joint wrongdoers have been joined in the action, to apportion the damages awarded to
the plaintiff between the wrongdoers, and to
'give judgment separately against each joint wrongdoer for the amount so
apportioned' .
In this way, the court has a statutory discretion to give effect to two equitable principles
312 LAWSA, vol 8, Part 1 (2nd ed, 2005), Delict, par 171. 'Joint wrongdoers were persons who jointly committed a delict by acting in pursuance of a concerted purpose, or in furtherance of a common design. ... Concurrent wrongdoers were persons whose independent delictual conduct combined to produce the same harmful consequence; ...'
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that are inconsistent with the common law rule of the several liability in solidum of joint
or common wrongdoers.
[277] The first such equitable principle is that, as far as each wrongdoer is
concerned, the plaintiffs patrimony has not been diminished by more than the
proportion of his loss attributed to the fault of that wrongdoer. This is another way of
requiring the plaintiff, or enabling the court, when assessing the loss sustained by the
plaintiff in consequence of the delict of each wrongdoer, to bring into account the benefit
represented by the plaintiff's claims against each of the other wrongdoers. In this way,
the legislature has made room for the application, in the context of joint wrongdoers, of
the common law principle that, for the purpose of assessing the plaintiff's patrimonial
loss caused by the delict of a particular wrongdoer, benefits accruing to the plaintiff as
a result of the same incident are to be brought into account.
[278] In terms of the second such equitable principle, when all of the wrongdoers
concerned are in a position to contribute to the restoration of the plaintiff's patrimonial
loss, no wrongdoer need be condemned to pay more than the proportion of the loss
attributed to the degree of his fault in relation to the plaintiff's damage.
[279] There is, however, a qualification that aims to ensure that the plaintiff will not
lose as a result of the inability of any of the joint wrongdoers to meet the judgment debt
entered against him. When the court has, in terms of s 2(8)(a)(ii) of Act 34 of 1956,
given judgment separately against each of the joint wrongdoers for his apportioned
share of the plaintiff's loss, and when the plaintiff finds himself unable to recover the
judgment debt from anyone or more of them, the court has power in terms of the
proviso to s 2(8)(a)(ii) to reapportion the share of any defaulting wrongdoer amongst the
remaining wrongdoers.
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[280] It is also relevant to note that, the 'Savings' provisions in s 4 of Act 34 of 1956
include the following:
'4. (1) The provisions of this Act shall not
(a) ... (b) operate to defeat any defence arising under a contract;'
[281] Having regard to all of the provisions of Act 34 of 1956, I am not satisfied that
the present matter is governed entirely by Nedcor v Lloyd-Gray. In the judgment of
Boruchowitz J in the court of first instance, it was assumed that the common law
principle of the several liability in solidum of joint or concurrent wrongdoers had been
adopted in Act 34 of 1956. This does not appear to me to be the correct approach. In
the Supreme Court of Appeal, on the other hand, the judgment of Scott JA was given
on the basis of an express assumption that Act 34 of 1956 was not applicable. 313
[282] As I have pointed out, s 2(1) of the Act is merely procedural in that it allows a
plaintiff to sue in the same proceedings all persons whom he alleges to be jointly or
severally liable to him in delict. However, nothing in Act 34 of 1956 renders the
defendants in such an action jointly and severally liable to the plaintiff. S 2(8)(a)(i) of
the Act, read with s 2(8)(a)(ii), merely empowers the court, in a case such as the
present one, in which there is no suggestion of any wrongdoer other than the two
defendants, and it is apparent from the facts alleged that all of the wrongdoers are
before the court, to decide whether to order:
1. in terms of s 2(8)(a)(i) of Act 34 of 1956 that the joint wrongdoers (if such they
are found to be) should pay the plaintiffs' damages jointly and severally, one
paying, the other to be absolved; or
2. in terms of s 2(8)(a)(ii) that the plaintiffs' damages should be apportioned
313 at p 922C, par [9].
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between the joint wrongdoers, and judgment should be entered separately
against each joint wrongdoer for the amount so apportioned.
[283] On the assumption on which the judgment of the Supreme Court of Appeal was
given in Lloyd-Gray Lithographers (that Act 34 of 1956 did not apply), the court had no
such discretion in that matter. In that relevant and material respect, the present case
differs. Act 34 of 1956 applies to the present case because the two wrongdoers have
been alleged to be jointly and severally liable and have been sued in the same action,
as contemplated by s 2(1), and there is a prayer for judgment against them jointly and
severally, as contemplated by s 2(8)(a)(i).
[284] There is a further important ground of distinction. It is that in Lloyd-Gray
Lithographers the question arose only in respect of joint wrongdoers i.e. in an
exclusively delictual context. The decision was to the effect that, where the
Apportionment of Damages Act 34 of 1956 was not applicable, the value of the
plaintiff's claim against one joint wrongdoer did not have to be brought into account in
determining the plaintiff's patrimonial loss for the purposes of an action against another
of the joint wrongdoers. That was a different question from the question that arose in
Mouton v Die Mynwerkersunie (above). In the latter case, the question was whether the
value of the plaintiff's contractual claim against an insolvent principal debtor had to be
brought into account in determining the plaintiff's patrimonial loss for the purposes of
the plaintiff's delictual claim against a wrongdoer. No question of joint wrongdoers
arose and, of course, Act 34 of 1956 was not applicable. It was held that the value of
the plaintiff's contractual claim had indeed to be brought into account in assessing the
plaintiff's patrimonial loss. The distinction between the two situations rests upon the fact
that in a contractual claim, the plaintiff sues for his bargain or its equivalent in money,
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and he does not have to prove his patrimonial loss as he does in a delictual claim on
Aquilian principles.
[285] If a plaintiff's patrimony incorporates a valuable contractual claim that in fact
reduces or even eliminates such patrimonial loss as is alleged to have been caused to
the plaintiff by a delict, the value of the contractual claim must be brought into account
in assessing the alleged patrimonial loss, unless the collateral source rule applies.
However, the converse does not apply: where a plaintiff has a claim in contract and a
concurrent delictual claim, the value of the latter is, of course, irrelevant to a
determination of the amount recoverable by the plaintiff in terms of his contractual
remedies.
[286] In the present matter, the plaintiffs allege in claim III that the first defendant is
vicariously liable for the delicts committed against them by the second defendants. This
implies joint and several liability on the part of both defendants. The delicts of the
second defendant are alleged in claim V. In respect of both of these claims in delict,
the plaintiffs pray for judgment against the first defendant and the second defendants
jointly and severally, one paying the other to be absolved. 314 The present matter is
therefore one in which the Apportionment of Damages Act 34 of 1956 has been invoked
and is applicable. The joint wrongdoers are before the court and, subject to the savings
in s 4(1), the court has the power to determine whether to grant a judgment against the
alleged wrongdoers jointly and severally in terms of s 2(8)(a)(i) or to apportion the
damages between them in terms of s 2(8)(a)(ii) and to give judgment separately against
each wrongdoer for the amount so apportioned. This state of affairs distinguishes the
present case from Lloyd-Gray Lithographers in which Act 34 of 1956 was not applicable.
314 p 81, introductory words to the prayers, read with prayers 1.2, 1.2.4, 1.3 and 2.
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[287] The question that remains relates to the effect of the savings provision in s
4(1)(b) of Act 34 of 1956. The Act does not
'operate to defeat any defence arising under a contract.'
Is the contention of the defendants that the value of the plaintiffs' contractual claims
against the first defendant must be brought to account in determining the plaintiffs'
patrimonial loss for purposes of the plaintiffs' claims in delict, a 'defence arising under
a contract' for the purposes of s 4(1)(b)?
[288] I consider first the case of the first defendant, with whom the plaintiffs have
privity of contract. The first defendant points to the fact that the plaintiffs' remedies
against him are to be found in the building contract. Act 34 of 1956 therefore does not
operate to defeat any defence arising under that contract. The first defence raised
under the building contract to claim III (raised by way of exception in these proceedings)
is to the effect that, similarly to the contract in Lillicrap between Lillicraps and Pilkingtons
(before the assignment to Salancs in March 1976), the building contract in the present
matter leaves no room for a claim against the first in delict for any of the damages
claimed in claim III. In terms of s 4(1)(b) of Act 34 of 1956, the Act does not operate to
defeat that defence.
[289] If that defence, which I shall call 'the Lillicrap defence', is wholly sound, it
eliminates claim III entirely. It leaves no room for any claim in delict against the first
defendant, and therefore no room for dispute about the question whether the plaintiffs
have sustained a patrimonial loss in consequence of the alleged delicts, in the
computation of which the value of the contractual claims must be brought into account.
For if it be assumed - rather pointlessly in the face of that defence, if it is a wholly sound
one - that the plaintiffs nevertheless have a concurrent claim in delict against the first
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defendant in terms of claim III, for the same amount (schedule X4) as they claim in
contract (schedules X2 and X3), the value of their contractual claims must be brought
into account, as in Mouton v Die Mynwerkersunie (above), in assessing their patrimonial
loss for the purposes of their claim III against the first defendant in delict. If it be
assumed further that the plaintiffs' contractual claims are all fully valid, their value must
wholly eliminate any patrimonial loss assessable for purposes of claim III. The first
defendant is in fact the government, and the plaintiffs face no risk that the government
will not be good for the judgment debt if the first defendant should be found liable.
[290] Having regard to the fact that none of the plaintiffs' contractual claims has been
challenged by exception, and that they must therefore all be assumed to be sound in
law, the nature of the Lillicrap defence is such that it must either be wholly sound or
wholly invalid. Subject to a reservation concerning claim II(1)(Part A) that I shall detail
below, I see no possibility of its emerging that certain of the plaintiffs' claims, or parts
of certain claims, may be met by the Lillicrap defence, but that other parts can survive
it.
[291] In my view, the Lillicrap defence raised by the first defendant is one to which
the saving in s 4(1)(b) of Act 34 of 1956 applies. It is a defence arising under a
contract, and the Apportionment of Damages Act does not operate to defeat it.
[292] Are the second defendants in any different position from the first defendant in
this respect? The second defendants have no privity of contract with the plaintiffs.
Does it follow that when the second defendants raise the Lillicrap defence by way of
their exceptions, it is not 'a defence arising under a contract' within the meaning of the
saving in s 4(1)(b) of Act 34 of 1956? In my judgment, it does not mean that.
[293] The Lillicrap principle is that when three or more participants in a single
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enterprise, such as a construction project, arrange their respective rights and obligations
in a chain of contracts that links them all with each other, even though each one is not
in privity of contract with every other one, each one is presumed (no doubt unless and
until the contrary is . shown) to have established by agreement all the rights and
obligations that he considers necessary, and does not anticipate that the law of delict
will interfere to impose additional rights or obligations beyond the limited sphere that has
already been recognized by law. Therefore, if one of such contracting parties sustains
a loss in circumstances that legal precedent has not already recognized as entitling him
to compensation from another of the contracting parties on Aquilian principles, the latter
principles will not be regarded as extending to the new situation so as to afford relief to
the party who has suffered the loss unless there are adequate reasons of legal policy
to do so. In determining whether there are such adequate reasons of legal policy, the
court will act conservatively.
[294] In my judgment, it is clear that the Lillicrap principle applies to the present case.
The plaintiffs contend, in essence, that it should be applied in such a way as to extend
recognition to their claim against the second defendants on Aquilian principles, although
there is no precise legal precedent therefor in this country. The defence raised by the
second defendants in these exceptions is substantially that the court's conservative
approach to such a question must preclude the recognition of an Aquilian remedy in the
circumstances alleged in the plaintiffs' particulars of claim. The outcome of this
difference must be decided on the basis of whether, on a conservative approach,
adequate reasons of legal policy emerge from the facts alleged in the particulars of
claim to justify the recognition of an Aquilian remedy despite the absence of any legal
precedent in this country. I shall have to address that question below. Meanwhile, the
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immediate question is whether that defence is one 'arising under a contract' for the
purposes of s 4(1)(b) of the Apportionment of Damages Act, 34 of 1956.
[295] Integral to the defence in question are the allegations in the particulars of claim
showing that the three parties participated in a single construction enterprise and that
they had, by means of two contracts, arranged their respective rights and obligations
for the conduct of the enterprise in such a way that the plaintiffs were bound to the first
defendant, and had subjected themselves to a measure of control by the second
defendants, in terms of the building contract, and that first and second defendants were
bound to each other in terms of the consultancy agreement. In the absence of the
building contract, the plaintiffs would not have been parties to the enterprise in question,
would not have been on the construction site and would not have been affected by the
collapse of the bridge, whatever its cause. Without the building contract, therefore, they
would not have had any claim at all, whether in contract against the first defendant or
in delict against the second defendants, arising out of anything done by the second
defendants in relation to the enterprise. In my view, it is therefore clear enough that all
of the plaintiffs' claims arise under the building contract, whether framed in contract or
in delict. In particular, the plaintiffs' claim in delict against the second defendants, claim
V, arises under the building contract because it was in terms of the building contract that
the plaintiffs subjected themselves to a measure of control by the second defendants.
It was essentially this fact that has enabled the plaintiffs to make, and on which the
plaintiffs rely for, their allegation that the second defendants owed them a legal duty of
care.
[296] In the same way, to the extent that the second defendants' defence raised by
the present exceptions relies on the proposition that the value of the plaintiffs' claims
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against the first defendant arising under the building contract must be brought into
account in determining the patrimonial loss that the plaintiffs seek to recover on Aquilian
principles from the second defendants in terms of claim V, that defence is also a
'defence arising under a contract' within the meaning of s 4(1)(b) of Act 34 of 1956.
Therefore I consider that Act 34 of 1956 does not operate to defeat it.
Summary of the logical problem
[297] To sum up the question of the logical problem raised by Mr Klevansky:
1. The logical problem posed by Mr Klevansky on behalf of the plaintiffs was this:
if the second defendants were allowed to raise the defence that because the
plaintiffs had a valuable claim against the first defendant, they, the plaintiffs,
had suffered no patrimonial loss from the delict alleged to have been
committed by the second defendants, the first defendant would equally be able
to raise the defence that the plaintiffs had suffered no patrimonial loss because
of the plaintiffs' valuable claim against the second defendants. The logical
result would be that the plaintiffs could not recover from either of the
defendants. The answer to this conundrum was to be found in Lloyd-Gray
Lithographers, (above).
2. This approach to the matter ignores the plaintiffs' contractual claims against
the first defendant. If it were permissible to ignore these claims, it would be
true that, because the plaintiffs have alleged in claims III and V that the first
and second defendants are jointly and severally liable to them in delict, s 2(1)
of Act 34 of 1956 would justify their being sued in the same action. Moreover,
if the plaintiffs succeed in proving claims III and V, and if their contractual
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claims are ignored, s 2(8)(a)(i) and (ii) would empower the court either to
enter judgment against the two defendants jointly and severally, one paying the
other to be absolved, or to apportion the liability between the two defendants
and to give judgment separately against each of them for the amount so
apportioned.
3. However, the fact of the matter is that the plaintiffs' contractual claims against
the first defendant do exist and cannot be ignored. Those contractual claims
give rise to a defence, raised in the exceptions, that the value of the contractual
claims must be brought into account for the purpose of determining whether or
not the plaintiffs have suffered a patrimonial loss as a result of the delicts
alleged in claims III and V.
4. The defence in question is a defence arising under a contract. Therefore, the
saving provision in s 4(1)(b) of Act 34 of 1956 has the consequence that the
provisions of Act 34 of 1956 do not operate to defeat that defence.
5. The result is that, just as in Mouton v Die Mynwerkersunie (above), the value
of the plaintiffs' contractual claims against the first defendant must be brought
into account for the purpose of determining to what extent, if any, the plaintiffs
have suffered a patrimonial loss as a result of the delicts alleged in claims III
and V.
6. On this approach, which I hold to be correct, the logical problem does not arise
and the matter is not governed by the decision in Lloyd-Gray Lithographers.
The suggested self-contradiction on the part of the second defendants
[298] I turn now to the fourth of Mr Klevansky's answers to the second defendants'
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proposition that the plaintiffs had suffered no patrimonial loss. His submission was to
the effect that the plaintiffs have alleged that the second defendants had themselves
ruled that the collapse of the bridge had not been caused by any conduct on the part
of the second defendants, but by the plaintiffs' own conduct; that the submission on
behalf of the second defendants that the plaintiffs have valuable claims in contract
against the first defendant is a submission that contradicts the second defendants' own
ruling; and that in these proceedings, the second defendants cannot be heard to
contradict themselves in that way.
[299] These exceptions must be approached on the basis that the allegations in the
plaintiffs' particulars of claim are correct. The substance of the plaintiffs' allegations is
that the second defendants ruled that the collapse of the bridge had not been caused
by the second defendants themselves, but by the plaintiffs' own failure to discharge their
obligations in respect of the temporary works. The plaintiffs allege that the second
defendants' ruling in that regard was wrong. It is the plaintiffs themselves who have
contradicted the second defendants' ruling. The second defendants' exception is taken,
as it must be, on the footing that the plaintiffs' allegation that the second defendants'
ruling was wrong is a correct allegation. In my view, there is no substance in Mr
Klevansky's submission in this regard.
Summary with regard to patrimonial loss
[300] For the reasons set out above, I conclude that:
1. The plaintiffs' remedies under the building contract with the first defendant are
not res inter alios acta in relation to their claim in delict against either the first
or the second defendants, claims III and V. Even on the approach adopted in
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Botha v Rondalia (above) - to the effect that the collateral source rule must be
held to apply, and that the rule excludes collateral sources of recovery from the
assessment of the plaintiffs' patrimonial loss resulting from a delict unless there
are substantial grounds of legal policy justifying the non-application of the rule
and thereby justifying the inclusion of a collateral source of recovery in such
assessment
(1) the plaintiffs' allegations in the present matter indicate that their
contractual remedies against the first defendant are not a 'collateral
source' within the meaning of the rule in that such remedies are not wholly
independent of either the first defendant or the second defendants; and
(2) in any event, there are substantial grounds of legal policy why the
collateral source rule should not be applied to exclude the value of the plaintiffs' claims from the assessment of their patrimonial loss alleged to
have been sustained as a result of the delicts attributed to the second
defendants and, vicariously, to the first defendant.
2. The submission on behalf of the plaintiffs that they had sustained a loss
because they had had to build a new bridge 'for nothing' is without substance.
The building contract determines the remuneration to which they were and are
entitled in the eventualities alleged and relied on by them, being
(1) delays proved to have been caused by the second defendants or by other
causes,
(2) damage or physical loss of the works or the material resulting from the
design, specification or instruction of the second defendants, and which
the plaintiffs were ordered to repair and make good,
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(3) variations ordered by the second defendants, and
(4) payment certificates issued by the second defendants.
3. . The 'logical problem' does not arise.
4. There is no substance in the suggestion that the second defendants' reliance
on the plaintiffs' allegation that the second defendants' ruling was wrong is a
self-contradiction on the part of the second defendants. The exception is
correctly based on an acceptance of the correctness of the plaintiffs'
allegations.
5. The defendants' submission that the value of the plaintiffs' contractual claims
against the first defendant must be brought into account for the purposes of
assessing their patrimonial loss suffered as a result of the alleged delicts is
correct.
The plaintiffs' patrimonial loss
[301] As alleged by the plaintiffs, their patrimonial loss caused by the delicts alleged
in claims III and V was as detailed in schedule X4. The total is R40,973,345.64,
including VAT. It is precisely equal to the total of the plaintiffs' contractual claims
against the first defendant as reflected in claims I and II and schedules X2 and X3. 315
Therefore, if all of the plaintiffs' contractual claims are sound, no patrimonial loss
remains for the plaintiffs to recover in delict. Without patrimonial loss, the plaintiffs have
no Aquilian remedy against the second defendants.
[302] Nevertheless, the plaintiffs' pleadings allow for the possibility that not all of their
contractual claims will be wholly successful. Indeed, as I have pointed out above, there
315 Claim IV is for the payment by the first defendant of the balance of certificate 39, amounting toR1,396,470.55 including VAT, plus interest. It has no counterpart in the delictual claims.
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is good reason to think that the contractual claim II(1), so far as it relates to items 5, 6
and 7 in Part B of schedule X3, claimed as 'any other losses', 316 has no foundation at all in the building contract. The total of Items 5, 6 and 7 is R24,084,989.23 including
VAT. It therefore constitutes a substantial proportion of the total of the plaintiffs' claims.
Only if it could be said that all of the plaintiffs' contractuaI claims will be wholly
successful, would it be possible to conclude that the plaintiffs will not have suffered any
patrimonial loss and that for that reason they have no valid claims in delict so that
claims III and V have no foundation. Of course, for purposes of an exception to a claim,
the factual allegations in the particulars of claim are taken to be correct unless they can
be challenged on some legal ground. But that does not mean that the value of the claim
is equal to the amount claimed. The very fact that the claimant has had to resort to
litigation to assert his claim is in itself a strong indication that the value of the claim must
remain uncertain until the litigation has been brought to a conclusion. Therefore, the
mere fact that such value as the plaintiffs' contractual claims may, at the end of the trial,
be found to have, must be brought into account and set off against the plaintiffs' claims
in delict does not necessarily put an end to the claims in delict.
Pure economic loss: is it a relevant consideration in this case?
[303] The defendants have submitted that the present case is one in which the
plaintiffs' claims in delict are for 'pure economic loss'. The plaintiffs do not contest that
approach. In my respectful view, the question that arises is whether or not the
proposition that the delictual claims are for pure economic loss is relevant in any way.
[304] 'Pure economic loss', it must be remembered, is not a concept that belongs to
316 Referred to in the particulars of claim at p 60, para 50,2, and p 61, para 52.2.
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the civil law system that we have inherited through Roman-Dutch law. It is a recent
intrusion into our legal system from English law and other common law systems. 317
Unlike many of the influences of the common law systems that have complemented
and enriched our law, it remains questionable in my view whether there is any useful
role for the concept of pure economic loss to play in our law other than as one of the
factors to be taken into account when considering the question of legal policy relating
to the limitation of the risk of opening the door to 'indeterminate liability'. This is
essentially because, in our law as developed in Administrateur, Natal v Trust Bank van
Afrika Bpk, 318 the answer to the question whether or not Aquilian principles provide a
remedy to a plaintiff who has suffered patrimonial loss at the hands of an alleged
wrongdoer, does not depend on whether or not the loss was purely economic. It
depends upon whether the alleged wrongdoer owed a legal duty to the plaintiff to
conduct himself in a particular way; whether he breached that duty and therefore
conducted himself wrongfully; whether he was at fault either through negligence (culpa)
or intention (dolus); and whether his conduct in breach of the legal duty caused the
plaintiff to sustain patrimonial loss. It is only if there is a prospect of 'indeterminate
liability' that the fact that the plaintiffs loss is pure economic loss (if that is the fact in the
case in question) may be taken into account as one of the factors relevant to the
decision to recognize or to decline to recognize, as a matter of legal policy, the
existence of a legal duty owed by the defendant to the plaintiff.
[305] The following definition of 'pure economic loss' has been put forward in LAWSA
317 LAWSA, vol 8, part 1 (2nd ed, 2005), par 68, especially the first four paragraphs on pp 111 and 112.
318 1979 (3) SA 824 (A).
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(with footnotes that I have omitted): 319
'Pure economic loss is financial loss sustained without the interposition of a
physical lesion or injury to a person or corporeal property, in other words,
unassociated with physical injury to the plaintiff's person or property,'
This is essentially the definition that I understand the parties to the present proceedings
to have adopted. It appears to be a definition of 'pure economic loss' as the concept
is understood in English law, and also to be the definition that Rumpff CJ had in mind
when he briefly summarized the position in Roman law, Roman-Dutch law and modem
South African law, 320 and emphasized how the English law of tort attributes to 'pure
economic loss' a significance that it has never had in the history of our own law of
Aquilian liability.321
[306] In the former passage, 322 the learned Chief Justice pointed out that even in
Roman times there were certain limited instances in which the right to recover
compensation for pure economic loss had been recognized, although the right was at
that time still in connection with corporeal property. This was plainly an allusion to the
fact that when a wrongdoer damaged the property of an owner, there were particular
instances in which a third person who held one of several specified types of interest in
the property, and who was accountable to the owner for the safe-keeping of the
property, also had a right of action against the wrongdoer for patrimonial loss (which in
his case could only be what is known in English law as 'pure economic loss') but only
to the extent of his interest in the owner's property. A pledgee, for example, had a right
319 LAWSA, vol 8, part 1 (2nd ed, 2005), par 68.
320 Administrateur, Natal v Trust Bank van Afrika Bpk 1979 (3) SA 824 (A), at 830F-H in fin.
321 Administrateur, Natal v Trust Bank van Afrika Bpk 1979 (3) SA 824 (A), at 831C - 832H.
322 Trust Bank, at at 830F-H in fin.
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of action against such a wrongdoer for 'purely economic patrimonial loss' , to the extent
of his interest (a real right) in the pledged property. Similarly, a borrower for use had
a right of action against such a wrongdoer for 'pure economic patrimonial loss' , to the
extent of his interest (a mere personal right, and a personal obligation to the owner for
the safe-keeping of the borrowed property).
[307] These developments were carried several stages further in Roman-Dutch law
and later in modern South African case law, in which, as the Chief Justice pointed out,
certain specific instances had been recognized in which Aquilian principles were found
to extend to a plaintiff the right to recover his patrimonial loss (of a kind that English law
would dub 'pure economic loss') from a wrongdoer who had wrongfully caused such
loss without having injured the person of the plaintiff and without having caused physical
damage to corporeal property belonging to the plaintiff or in which the plaintiff held an
interest. The point being made by Rumpff CJ was plainly that our law, unlike English
law, had long since begun to develop along lines that did not use 'pure economic loss'
or its counterpart, loss caused through the interposition of physical damage or injury,
as a criterion for determining whether or not a plaintiff who had suffered patrimonial loss
at the hands of an alleged wrongdoer, had an Aquilian cause of action for the recovery
of his loss from the alleged wrongdoer.
[308] In the second passage I have referred to, 323 the Chief Justice contrasted the
approach of our law (essentially that 'pure economic loss' is not a criterion that dictates
that patrimonial loss must lie where it falls) with English law, in terms of which pure
economic loss was historically a criterion that precluded the recovery of damages in tort
until the decision of the House of Lords in Hedley Byrne & Co Ltd v Heller and Partners
323 Trust Bank, at 831C - 832H.
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Ltd [1963] 2 All ER 575 (HL) recognized liability for financial loss caused by negligent
misstatement in certain circumstances.
[309] In making this comparison, Rumpff CJ quoted with approval a passage from
the article by Professor Price headed 'Aquilian Liability for Negligent Misstatements' 324
in which the professor had observed that in Anglo-American law there was at that time
no touchstone of liability for patrimonial loss, that the matter was one of 'great
confusion' and that the law was 'in a deplorable condition'. The Chief Justice similarly
approved a passage from another article by the same professor, 'Aquilian Liability and
the Duty of Care: A Return to the Charge'. 325 The passage in question contrasted the
Roman law principle of 'liability wherever there was damage unjustifiable done' with the
reliance of English law on duty to take care. It further reflected the opinion of the
professor, obviously approved by the Chief Justice, that the Roman doctrine 'provided
a better and simpler solution of the problems involved'. The quotation selected by the
Chief Justice ended significantly with the proposition concerning the Roman law delict
that we have inherited in this country,
'in its final and complete stage of development is committed by the wrongful
causing of patrimonial loss of any kind, whether the incidence of that loss arises
from physical harm to the person or corporeal property, or otherwise'.
The Chief Justice's implied rejection of the English law distinction between pure
economic loss and patrimonial loss caused through the interposition of physical damage
to corporeal property or physical injury to the person, as a criterion for Aquilian liability
is apparent.
[310] Rumpff CJ also quoted with approval a passage from an article in TSAR 1977
324 1950 SALJ 139.
325 1959 Acta Juridica 120, at 138.
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(3) by Professor J C van der Walt. 326 Professor van der Walt had suggested that the
true reason for the irrecoverability, according to the English law of tort, of damages for
pure economic loss caused negligently, had never been that conduct causing pure
economic loss was necessarily lawful. On the contrary, the main reason for the
irrecoverability was the concern that liability for pure economic loss caused negligently
might lead to limitless liability and grow into a burden that would unduly restrict
enterprise.
[311] Prof van der Walt quoted from, and Rumpff CJ referred with approval to, the
passage in Hedley Byrne in which Lord Devlin had attempted, in forceful language, to
dispel the idea there was any merit in the supposed distinction in English law between
pure economic loss and financial loss caused by physical damage or injury for the
purposes of determining the question of liability for negligent misstatement. To provide
the context and point the argument, I have added three footnotes and I quote somewhat more of the passage in question. Lord Devlin said: 327
'Originally it was thought that the tort of negligence must be confined
entirely to deeds and could not extend to words. ... I cannot imagine that
anyone would now dispute that, if this were the law, the law would be gravely
defective. ...
A simple distinction between negligence in word and negligence in deed
might leave the law defective but at least it would be intelligible. That is not,
however, the distinction that is drawn in counsel for the respondents' argument
and it is one which would be unworkable. ...
That is why the distinction is now said to depend on whether financial loss
is caused through physical injury or whether it is caused directly. The
interposition of the physical injury is said to make a difference of principle. I can
find neither logic nor commonsense in this. If irrespective of contract, a doctor
326 Trust Bank, at 832B-G. The article deals with the case of Suid-Afrikaanse Bantoetrust v Ross en Jacobz 1977 (3) SA 184 (T).
327 [1963] 2 All ER 575 (HL), at 602E - 603B.
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negligently advises a patient that he can safely pursue his occupation and he cannot and the patient's health suffers and he loses his livelihood, the patient has a remedy. 328 But if the doctor negligently advises him that he cannot safely pursue his occupation when in fact he can and he loses his livelihood, there is said to be no remedy. 329 Unless, of course, the patient was a private patient and the doctor accepted half a guinea for his trouble; then the patient can recover al1.33O I am bound to say, my lords, that I think this to be nonsense. It is not the sort of nonsense that can arise even in the best system of law out of the need to draw nice distinctions between borderline cases. It arises, if it is the law, simply out of a refusal to make sense. The line is not drawn on any intelligible principle. It just happens to be the line which those who have been driven from the extreme assertion that negligent statements in the absence of contractual or fiduciary duty give no cause of action at all have in the course of their retreat so far reached.'
In this way, Lord Devlin firmly rejected the idea that the distinction in English law
between pure economic loss and financial loss caused by the interposition of physical
injury had any legal significance for the purposes of determining whether a bank; when
replying to an enquiry for information, had a duty to exercise due care in formulating a
reply.
[312] Quoting further from Professor van der Walt's article, Rumpff CJ approved the
proposition that Hedley Byrne had not put an end to the 'nonsense' in English law of the
distinction between pure economic loss and financial loss caused through physical
injury. The learned Chief Justice went on to observe 331 that he had referred to English
law in this deprecating manner because he considered that a recourse to English law
would not be of much assistance in formulating the principles of our own law relevant
328 The interposition of physical injury causing financial loss is said to have attracted legal liability.
329 The absence of physical injury is said to give the loss the character of being purely economic and to preclude legal liability.
330 Consideration having been given, there is a contract that renders the doctor liable for his negligence.
331 Trust Bank, at 832H.
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to the question of liability for negligent misstatement. He added that it was not to be
denied that certain features of English law could be taken into account in regard to
setting limits to the extent of such liability i.e, to avoid opening the door to 'limitless
liability'. The proposition is wide enough to be understood as an indication that pure
economic loss, though not in our law a reason for denying Aquilian relief, may yet be
one of the factors to be taken into account when considering the risk to a particular
defendant, or to the interests of society in general, of exposing the defendant to limitless
liability in the circumstances of a particular case.
[313] In my view it is clear that the decision in Administrateur, Natal v Trust Bank
expressly acknowledged that the principles of Aquilian liability in our own law had long
since advanced beyond a state that would justify anything like a dogmatic assertion of
a general rule to the effect that only patrimonial loss caused through the interposition
of physical damage to corporeal property or injury to the person could be recovered,
and not pure economic loss. The same decision also repudiated the idea that the
English law distinction between pure economic loss and loss caused by the interposition
of physical injury or damage provided a useful criterion for distinguishing between
instances of patrimonial loss in which Aquilian principles may be recognized as
imposing liability on the person whose conduct caused the loss, and instances in which
such loss should be left to lie where it falls.
[314] In the light of Administrateur, Natal v Trust Bank, it seems to me that the
English law concept of 'pure economic loss' has no useful place in our law, other than
as one of the factors to be weighed up when assessing the risk to the defendant, and
to society as a whole, of exposing the defendant, and other defendants in future
matters, to limitless liability. Nevertheless, subsequently to 1979 there have been
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certain decisions that have employed the concept of pure economic loss as if Rumpff
CJ had actually approved it and adopted it as a feature of our law that provides the
criterion that distinguishes recognized cases of Aquilian liability from 'new' situations to
which Aquilian liability does not at present extend and may not be extended unless the plaintiff alleges and proves facts justifying the legal inference that the defendant owed
the plaintiff a legal duty. However, that was not the ratio of the decision.
[315] If the notion of 'pure economic loss' as a criterion for a distinction that might be
useful in the context of our own law is to be persisted in, it needs to be redefined in a
manner that reflects our own law. The abovequoted definition in LAWSA 332 could be
expanded by the addition of words that I have italicized, to read:
'Pure economic loss is financial loss sustained without the interposition of a
physical lesion or injury to a person or corporeal property, in other words,
unassociated with physical injury to the plaintiff's person or property or to the
property of another in which the plaintiff has such an interest as affords him a right
of action against the wrongdoer on Aquilian principles.'
The italicized qualification seems to me to be necessary in order to narrow down the
concept of pure economic loss and thereby to accommodate the many cases in our own
law in which a non-owner, who has any of a number of types of interest in corporeal
property that does not belong to himself but to another, has a right of action on Aquilian
principles against a wrongdoer who has caused both damage to the property in question
and consequent patrimonial loss to the non-owner in question.
[316] If pure economic loss were to be defined in this more restricted way, it might
well serve as a useful general criterion (though with some exceptions) by which to
distinguish between two broad classes of cases for the application of Aquilian principles.
332 LA WSA, vol 8, part 1 (2nd ed, 2005) par 68.
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The first of them is a well-established class of 'old' cases in which the plaintiff in effect
enjoys the benefit of a rebuttable presumption that the defendant's conduct that caused
the patrimonial loss complained of by the plaintiff was wrongful, unless and until the
defendant establishes facts that justify his damage-causing conduct. The plaintiff enjoys the benefit of this presumption in such cases because the law does not generally
allow conduct that causes personal injury or damage to property belonging to the
plaintiff or to property in which the plaintiff has an interest that has already been
recognized as enjoying the protection of a remedy based on Aquilian principles. In this
class of cases, it is for the defendant to allege and prove facts that justify his damage
causing conduct, or to pay the amount of the plaintiff's patrimonial loss.
[317] The second of the two classes of cases is comparatively new. It was
introduced by Administrateur, Natal v Trust Bank in 1979. Gases falling into this class
are marked by the following characteristics:
1. They are cases presenting factual situations that have not previously been
recognized authoritatively as falling within the ambit of the application of
Aquilian principles of liability.
2. The plaintiff does not enjoy the benefit of a rebuttable presumption of the
unlawfulness of the conduct of the defendant that caused the patrimonial loss
of which the plaintiff complains.
3. The plaintiff must allege and prove facts and circumstances that justify the
legal inference that the defendant owed the plaintiff a legal duty to conduct
himself in a particular way, and that the defendant breached that duty, so that
his conduct was unlawful.
4. As usual, the plaintiff must also allege and prove facts establishing
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(1) that the defendant's unlawful conduct caused the patrimonial loss of which
the plaintiff complains; and
(2) that the defendant was at fault, either through negligence (culpa) or
intention (dolus).
5. Although Aquilian principles are flexible enough to extend to situations in which
they have not previously been authoritatively found to be applicable, the law
requires the courts to act conservatively in granting recognition of the
applicability of the principles to such 'new' situations. 333
[318] To identify some of the situations in which our law has long recognized the
applicability of a remedy based on Aquilian principles in situations involving patrimonial
loss of a kind that English law would apparently classify as 'pure economic loss', I refer
to the well-known case of Smit v Saipem. 334 It was decided in 1974, just 5 years before
Administrateur, Natal v Trust Bank in 1979 and, although not referred to expressly in the
latter case, the principle it upholds was obviously present to the mind of Rumpff CJ and
the remainder of the court. The passage at 830F - H of Trust Bank implies it.
[319] In Smit v Saipem, Messrs Rolfe and Du Preez were the joint registered owners
of two erven referred to as erf 1 and erf 2. Mr Van der Walt was the registered owner
of erf 3. On or about 10th February 1970, all three registered owners entered into deeds
of sale in terms of which they sold and agreed to transfer the three erven to Smit on
certain terms. The purchase price was R8,800 per erf, and Smit was to pay it off over
333 Union Government v Ocean Accident and Guarantee Corporation Ltd 1956 (1) SA 577 (A), at 584H-586A; 586H - 587 A Administrateur, Natal v Trust Bank van Afrika Bpk 1979 (3) SA 824 (A), at 831A-C. Shell & BP South African Petroleum Refineries (Pty) Ltd and others v Osborne Panama SA 1980 (3) SA 653 (D), at 659E-F; 659H - 660A Coronation Brick (Ply) Ltd v Strachan Construction Co (Ply) Ltd 1982 (4) SA 371 (D). at 385F. Lillicrap, Wassenaar and Partners v Pilkington Brothers (SA) (Pty) Ltd 1985 (1) SA 475 (A). at 50OC-F.
334 1974 (4) SA 918 (A).
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three years with a deposit of R2,800 per erf on or before 1st April 1970 and monthly
instalments of R45 per erf thereafter. The owners were to place Smit in possession and
give him occupation of the three erven on the date of signature of the deed of sale. The
erven were not to be transferred into the ownership of Smit until he had paid or secured
the payment of the full amount of the purchase price of the erven. The owners duly
gave possession and occupation of the erven to Smit, the risk passed to him, and he
evidently performed his obligations in terms of the deeds of sale for close on two years.
At that stage, in January 1972, at a time when Smit had not finished paying for the
erven and had not become the owner of them, Saipem, a firm of earthmoving
contractors, trespassed on the three erven by driving heavy earthmoving machinery
over them. They caused substantial physical damage to the erven. The damage
reduced the market value of the erven by R4,OOO.
[320] Smit instituted an action on Aquilian principles against Saipem for damages of
R4,OOO. In his particulars of claim, he averred the facts that I have summarized above.
Saipem's main plea to the claim was to the effect that as Smit was not the owner of the
erven, they, Saipem. were not liable to him in respect of the conduct alleged by him, or
for the damages claimed by him, or for any damages. Smit excepted to the plea on the
ground that it disclosed no defence in law. In the court of first instance, the exception
was dismissed. In other words, that court found that the plea disclosed a legally sound
defence to Smit's claim.
[321] On appeal to the Appellate Division, the decision was reversed; the exception
was upheld by the majority of the court, with one dissent; the plea was held to be bad
in law, and the validity of Smit's cause of action was vindicated.
[322] In a judgment concurred in by the majority of the court, Jansen JA regarded the
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contract as essentially a hire-purchase contract, and he referred to the differences of
opinion that had arisen in the provincial divisions over the question whether or not the
hire-purchaser of an item of corporeal property had a right of action against a wrongdoer
who had negligently damaged the property, or whether it was only the owner who had
such a right of action. 335 The learned judge emphasized the fact that, in the absence
of any suggestion that any of the persons concerned was insolvent, the economic loss
resulting from physical damage that diminished the market value of the property would
not be felt by the owners, Rolfe, Du Preez and Van der Walt (whose claims against the
hire-purchaser, Smit, constituted their real economic asset, and not their ownership of
the property). The economic loss would indeed be sustained by Smit as he would have
to pay the full balance of the purchase price for the ownership of property, the market
value of which had been diminished by R4,OOO as a result of the physical damage
inflicted by the conduct of the wrongdoer. 336
[323] If our law had been to the effect that in such a situation, the loss is suffered by
the owner; that the owner has a right of action against the wrongdoer and, because of
the physical damage to his corporeal property, he enjoys the benefit of a rebuttable
presumption that the wrongdoer acted wrongfully; that the hire-purchaser's loss, on the
other hand, is purely economic; that therefore the hire-purchaser does not enjoy the
benefit of any presumption that the wrongdoer's conduct in inflicting physical damage
on the owner's corporeal property was wrongful; and that the hire-purchaser would have
to show, if he could, facts and circumstances that justified an inference of law that the
wrongdoer had owed him a legal duty and, by damaging the owner's property, had
335 Smit v Saipem (above) at 927B.
336 Smit v Saipem (above) at 926H - 927 A; and 932F-H.
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breached the legal duty owed to the hire-purchaser so that his conduct had been
wrongful in relation to the hire-purchaser and had caused the hire-purchaser's pure
economic loss, the court would undoubtedly have pointed out that that was the legal
position. If that had been our law, then, on the allegations made in Smit v Saipem, the
court would inevitably have had to hold that, in the absence of averments in the
particulars of claim justifying the conclusion that the wrongdoer had owed a legal duty
to the hire-purchaser, the plea could reasonably be understood to mean that the hire
purchaser, not being the owner, had failed to disclose a cause of action, and that the
plea was therefore sound in law. However, the court did not hold anything of the sort
because that is not our law and because the proposition that a hire-purchaser's loss
falls into the recently identified category known as 'pure economic loss' does not reflect
our law correctly.
[324] Jansen JA reviewed the historical development of the relevant rules of Roman
and Roman-Dutch law. The actio furti and the actio legis Aquiliae both developed into
actions for damages with little or no material difference between them. 337 The owner's
right to bring these actions for the theft of or damage to corporeal property was
extended to other persons with an interest in the property, particularly if such other
interested person was responsible to the owner for the safe-keeping of the property. 338
Thus, a right of action against a wrongdoer whose conduct had damaged corporeal
property was extended not only to the owner of the damaged property, but also to such
non-owners as a bona fide possessor, a pledgee, a usufructuary and a hirer. The
patrimonial loss of each of these non-owners would fall within what appears to be the
337 Smit v Saipem (above) at 929H.
338 Smit v Saipem (above) at 927H - 928C.
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English law concept of 'pure economic loss' that, before Hedley Byrne in 1963, was not
recoverable That label has always been entirely irrelevant, throughout the lengthy
history of the development of our law. Jansen JA pointed out 339 that by the time of DeGroot the stage had been reached at which, in terms of Roman-Dutch law, it could be
stated that when corporeal property had been stolen or damaged, it was not only the
owner who enjoyed a right of action against the wrongdoer, but everyone who had an
interest in the property (including an interest consisting of a merely personal right
against the owner), such as, for example, a borrower for use, a creditor (such as a
pledgee), or a possessor, each to the extent of his interest. 170 years after this state
of the law had been recognized by De Groot, it had been confirmed by Van der Keessel.
Jansen JA took it that any of the interested non-owners would have had to have been
in possession of the property in question when it was stolen or damaged in order to be
in a position to assert a claim against the wrongdoer to the extent of his particular
interest in the property. The learned judge also referred 340 to cases in which these
propositions of law had been called into question, and he stated that the doubts had
been without foundation.
[325] On the basis of the historical development of our law, and the principle that
Smit, as a hire-purchaser who had accepted the risk of the loss or destruction of the
property, and who remained bound to pay the agreed purchase price to the owners, was
the person who had suffered the economic loss resulting from the physical damage,
the court held that he indeed had a valid right of action against the alleged wrongdoer.
The latter's plea that Smit was not the owner of the property therefore did not disclose
339 Smit v Saipem (above) at 927C-H.
340 Smit v Saipem (above) at 927H.
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a defence and the exception to that effect was upheld. Far from 'pure economic loss'
being a reason for withholding an Aquilian remedy from Smit, it was the fact that his so-
called 'pure economic loss' was the real loss that was sustained as a result of the delict
(since the owners' losses were additionally covered by Smit's obligations to them) that
entitled Smit to an Aquilian remedy additional to that enjoyed by the owners.
[326] In my respectful view, Smit v Saipem is, for the reasons I have indicated,
irreconcilable with the proposition that when physical damage to corporeal property
causes loss to a person with an interest in the property that is short of ownership, such
non-owner's loss is 'pure economic loss' despite his interest in the property. The
essential reason why it is irreconcilable is that once the loss is labelled 'pure economic
loss' in this way, the new doctrine is that the non-owner who suffered the economic loss
has no right of action against the wrongdoer unless he alleges and proves facts and
circumstances justifying the inference of law that the alleged wrongdoer owed him a
legal duty, breached the legal duty and therefore acted wrongfully. 341 The non-owner
will also be faced with the problem that the court must act conservatively in recognizing
the existence of a legal duty where it has not been recognized by previous authority.
[327] That is not the law as stated in Smit v Saipem, which has never been overruled
and which has been applied many times since it was decided some 30 years ago.
When a hire-purchaser (or a purchaser under an instalment sale agreement who is not
the owner), who has accepted the risk in respect of the corporeal property being
acquired, sustains patrimonial loss as the result of physical damage to such property,
his loss may be 'pure economic loss' as defined by English law, but it does not follow
that he has no Aquilian remedy unless he alleges and proves facts to show that the
341 Cf The Oil Rig 'South Seas Driller': Sheriff of Cape Town v Pride Foramer SA and Others 2001 (3) SA 841 (C), at 843E-F.
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wrongdoer owed him a legal duty and breached it. He is entitled to the same rebuttable
presumption as is enjoyed by the owner, that the conduct of the wrongdoer who caused
the physical damage was wrongful, unless and until the alleged wrongdoer justifies his
damage-causing conduct. The same is true of the other non-owners whose respective
interests in property that they do not own, or whose personal rights against and
obligations to the owner, have been authoritatively recognized in our law as affording
them a cause of action against the wrongdoer, to the extent of their respective interests
in the property.
[328] Nevertheless, despite Smit v Saipem and Administrateur, Natal v Trust Bank,
there are indications that the English law approach to the treatment of 'pure economic
loss' is making some headway against the principles set out in these leading cases.
There may be justification for this in certain admiralty cases to the extent that English
law remains applicable. Beyond that, it seems to me that the encroachment is not
helpful and should be resisted.
[329] In Shell & BP South African Petroleum Refineries (Pty) Ltd and Others v
Osborne Panama SA 342 the second plaintiff was one of three joint owners of a mooring
buoy for the discharge of tankers. The second plaintiff was also the charterer of a
tanker ('the Mobil') with an obligation to the owners of the Mobil in respect of
demurrage. Through the negligent navigation of another tanker ('the Olympic') by
operators for whose negligence the defendants were vicariously liable, the Olympic
collided with the mooring buoy and caused physical damage to it. As a result, the
second plaintiff sustained patrimonial loss in two respects: first, the value of the buoy
was diminished by an amount equal to the costs of repair, and second, the discharge
342 1980 (3) SA 653 (D).
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of the Mobil was delayed and the second defendants incurred a liability for demurrage.
[330] Howard J held the defendants to be liable to the second plaintiff for the
patrimonial loss that they had sustained as a result of the reduction in value of the buoy
through physical damage to it. Once the negligence of the operators of the Olympic in
damaging the buoy had been established, and the vicarious liability of the defendants
therefor, the presumption of the wrongfulness of the conduct for which the defendants
were liable was tacitly applied i.e. the learned judge accepted without question that the
operators of the Olympic had owed the second plaintiff, in their capacity as one of the
owners of the buoy, a legal duty not to damage the buoy through negligent navigation,
had breached the duty by their conduct, and had done so culpably through their
negligence.
[331] As to the second plaintiff's patrimonial loss from the same cause, but in respect
of demurrage payable for the delay of the Mobil, the learned judge considered that he
was faced with a situation to which the principles of Aquilian liability had not previously
been applied. The court had to approach the matter as laid down in Administrateur,
Natal v Trust Bank, and to exercise its control over the scope of Aquilian liability by
determining, in accordance with legal policy, whether or not the defendants had owed
any legal duty to the second plaintiff in their capacity as the charterers of the Mobil
(irrespective of the legal duty owed to them as part owners of the buoy). 343 In so doing, the court was required to approach the matter conservatively. 344 Howard J considered
a number of factors and came to the conclusion that to find that the defendants had
owed a legal duty of care to the second plaintiff as charterer of the Mobil 'would involve
343 Shell & BP (above), at 659B-C.
344 Shell & BP (above), at 659E-F.
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a radical departure from the conservative approach.' 345 He therefore dismissed the
second plaintiff's claim in respect of demurrage. In these respects, there was no
departure from Administrateur, Natal v Trust Bank.
[332] In the course of his judgment, 346 the learned judge also observed that the
second plaintiff's claim in respect of demurrage was
'a claim for the recovery of pure economic loss, in the sense that the
damages suffered by the second plaintiff do not arise from physical injury
to its property'
and that in English law
'a time charterer has no right of action to recover damages for pecuniary
loss from a third party who negligently sinks or damages the chartered
vessel. '
These observations were, no doubt, relevant to the extent that English admiralty law
remains applicable in South Africa in admiralty matters. However, it seems to me to be
necessary to point out, with respect, that in the light of the firm rejection in
Administrateur, Natal v Trust Bank of the idea that the significance attached in English
law to 'pure economic loss' as a criterion for determining whether or not, according to
our own law, Aquilian principles provide a remedy in a situation not covered by existing
authority, the fact that the plaintiff's patrimonial loss was 'purely economic' remains
irrelevant in all situations to which English admiralty law is not applicable.
[333] On appeal to the Appellate Division, the decision of Howard J was upheld. 347
Wessels JA, delivering the judgment of the court, held that it had not been shown that
345 Shell & BP (above), at 659G - 660A.
346 Shell & BP (above), at 659A and 659F.347 Osborne Panama SA v Shell & BP South African Petroleum Refineries (Pty) Ltd and Others 1982 (4) SA 890 (A), at 900G - 901A
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'the defendant was under a legal duty towards the second plaintiff to ensure
that those who were in charge of the tanker during berthing operations would not
by negligent conduct cause second plaintiff to suffer pure economic loss. In the
absence of a legal duty there can be no unlawfulness.'
The learned judge referred to Administrateur, Natal v Trust Bank, at 833A, a passage
that contains no reference to 'pure economic loss'. The cited passage is one in which
Rumpff CJ emphasized that wrongfulness is a requirement for Aquilian liability; that in
cases of alleged negligent misstatement the court can and must control the fear of
limitless liability by determining on the facts of each case whether the defendant owed
the plaintiff a legal duty to refrain from making the misstatement, and whether the
defendant had exercised reasonable care to establish the accuracy of his statement.
The cited passage concludes with the observation that in the absence of a legal duty,
there could be no wrongfulness. In the cited passage, Rumpff CJ made no reference
to 'pure economic loss'. It is a strange fact, I say with respect, that Wessels JA did not
point out that in Administrateur, Natal v Trust Bank the Appellate Division had actually
rejected the idea that 'pure economic loss' was the criterion for the identification of a
case in which the the law does not presume that the defendant owed the plaintiff a legal
duty but requires the plaintiff to allege and prove facts to establish such a duty and the
defendant's breach of it that establishes the element of wrongfulness. Rumpff CJ had
laid down that requirement for cases of negligent misstatement and, by implication, for
other cases involving 'new' situations to which no authority had previously held that the
principles of Aquilian liability were applicable. 'Pure economic loss' was not the
touchstone.
[334] Subsequently, there have been some decisions in which the question of the
applicability of Aquilian principles of liability has been decided without reference to 'pure
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economic loss', as in Administrateur, Natal v Trust Bank, and others in which 'pure
economic loss' has been given the significance that, despite Lord Devlin's dismissal of
. it as 'nonsense', it would apparently have had in English law. I shall mention only a few
of the cases.
[335] In Franschhoekse Wynkelder (Ko-operatief) Bpk v South African Railways and
Harbours, 348 Vos J dealt with an exception to a claim for relief on Aquilian principles.
The facts alleged revealed a 'new' situation of a kind to which no previous authority had
recognized that Aquilian liability attached. The learned judge examined the facts and
circumstances alleged and concluded that the plaintiffs' allegations were insufficient to
establish that the defendant had owed the plaintiff a legal duty, and that therefore the
element of wrongfulness had not been alleged. He upheld the exception on that basis.
. He did not suggest that the fact that the plaintiff's loss had been purely economic was
the relevant criterion, nor indeed did he mention that circumstance at all. The decision
was therefore, in my respectful view, in accord with Administrateur, Natal v Trust Bank.
[336] In Arthur E Abrahams & Gross v Cohen & Others, 349 an appeal against the
dismissal of an exception to particulars of claim in which the plaintiff claimed for
patrimonial loss resulting from the alleged negligent failure of an executor to perform his
duties, Marais J said, at 309D:
'As I see the position it comes to this. A defendant may be held liable ex
delicto for causing pure economic loss unassociated with physical injury
but before he is held liable it will have to be established that the possibility
of loss of that kind was reasonably foreseeable by him and that in all the
circumstances of the case he was under a legal duty to prevent such loss
occurring. '
348 1981 (3) SA 36 (C).
349 1991 (2) SA 301 (C), at 309.
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It was no doubt unnecessary for the learned judge to deal with the exceptions to this
general proposition. Nevertheless, it is necessary, in a case such as the present one,
to bear in mind that, if pure economic loss is defined as 'economic loss unassociated
with physical injury to the person or damage to the property of the plaintiff, then there
remain the important exceptions indicated by the decision in Smit v Saipem. A hire-
purchaser, and other non-owners with various interests in items of corporeal property
belonging to others, who may sustain patrimonial loss as a result of a wrongdoer's
conduct that damages the property in question, have a right to an Aquilian remedy
against the wrongdoer for the recovery of their patrimonial losses, each to the extent of
his interest in the property, notwithstanding the fact that the losses may be described
as 'purely economic'. Wrongfulness on the part of the wrongdoer is rebuttably
presumed, and such a hire-purchaser or other interested non-owner therefore does not
have to establish that the wrongdoer owed him a legal duty.
[337] In Tobacco Finance (Pvt) Ltd v Zimnat Insurance Co Ltd, 350 Squires J heard
an action in which the plaintiffs sought Aquilian relief in circumstances in which the
availability of such a remedy was in issue. The learned judge did not reject the fact that
the plaintiffs' claim was for pure economic loss as irrelevant, as had been done in
Administrateur, Natal v Trust Bank. Instead, he approached the matter on the basis that
although pure economic loss may once have been a bar to Aquilian relief, the law was
in the process of changing to admit of such relief at least in some cases of pure
economic loss. I refer in particular to a passage in the judgment at 63E to 64A in which
the learned judge referred to certain English and South African authorities. He went on
to say, at 64A-B:
3SO 1982 (3) SA 55 (ZH).
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'In view of these authorities, it does not seem to be sound to say any longer, if it
ever was always the case and it was not just a problem of remoteness, that pure
economic loss cannot be recovered in an action based on negligence simply for
that reason. It is true that there have been authorities which go the other way, ...'
In the end, the learned judge came to the conclusion that existing authority did extend
Aquilian relief to the facts of the case. He added that, to the extent that it might be
necessary to make a policy decision, he considered that the facts established that a
remedy on Aquilian principles was indeed available to the plaintiffs.
[338] In Coronation Brick (Pty) Ltd v Strachan Construction Co (Pty) Ltd, 351 Booysen
J unequivocally rejected the idea that pure economic loss was a bar to the Aquilian
action. The learned judge said, at 377E:
'In essence the Aquilian action lies for patrimonial loss caused wrongfully
(or unlawfully) and culpably. Although the contrary view had long been
held by many authorities, it seems clear that the fact that the patrimonial
loss suffered did not result from physical injury to the corporeal property or
person of the plaintiff, but was purely economic, is not a bar to the Aquilian
action.' He went on to cite a number of authorities.
[339] In Sea Harvest Corporation (Pty) Ltd and Another v Duncan Dock Cold Storage
(Pty) Ltd and Another, 352 Scott JA, dealing essentially with the period since the decision
in Administrateur, Natal v Trust Bank in 1979, said:
'[19] In the course of the past 20 years or more this Court has repeatedly
emphasised that wrongfulness is a requirement of the modern Aquilian
action which is distinct from the requirement of fault and that the inquiry
into the existence of the one is discrete from the inquiry into the existence
of the other. Nonetheless, in many if not most delicts the issue of
351 1982 (4) SA 371 (D).
352 2000 (1) SA 827 (SCA), at 837G-H, par [19].
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wrongfulness is uncontentious as the action is founded upon conduct which, if held
to be culpable, would be prima facie wrongful. (Compare Lillicrap, Wassenaar and
Partners Pilkington Brothers (SA) (Pty) Ltd 1985 (1) SA 475 (A) at 497B-C.) It is
essentially in relation to liability for omissions and pure economic loss that the
element of wrongfulness gains importance.'
[340] In my respectful view, the learned judge's reference to the many cases in which
the conduct of the defendant would be prima facie wrongful was a reference to all of the
types of conduct (other than wrongful omissions) that, prior to Administrateur, Natal
Trust Bank in 1979, had been authoritatively recognized as justifying relief on Aquilian
principles. They included cases of patrimonial loss caused by personal injury, or
caused by physical damage to the corporeal property of the plaintiff, or caused by
physical damage to corporeal property belonging to a third person in which property the
plaintiff had such an interest as afforded him a right of action in accordance with the
ancient principles of our law that were reaffirmed and applied in Smit v Saipem -
irrespective of the fact that such a non-owner's patrimonial loss is described in English
law as 'pure economic loss'. Patrimonial loss caused in any of those ways was, and
remains, prima facie wrongful if it is culpable, notwithstanding the fact that, in some of
such cases, it is 'pure economic loss'. It is for the defendant to show, if he can, that his
culpable, damage-producing conduct was justified in law and therefore not wrongful.
In other words, in the Case of conduct authoritatively recognized before 1979 as giving
rise to an Aquilian remedy, the wrongfulness of the defendant's conduct, if it is culpable,
is rebuttably presumed, unless and until the defendant establishes some legal
justification for his conduct.
[341] Administrateur, Natal v Trust Bank did not alter that state of affairs by requiring
plaintiffs to prove wrongfulness where previously they had enjoyed the benefit of a
rebuttable presumption of wrongfulness. What it did was to open the door,
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conditionally, to the recognition of the Aquilian remedy as extending into a new area,
beyond the established area of patrimonial loss caused by conduct already
authoritatively recognized as prima facie wrongful. In this new area, certain kinds of
damage-producing conduct, never previously recognized authoritatively as wrongful,
would, on fulfilment of a condition, be recognized as wrongful for purposes of an
Aquilian remedy. The condition related to the question of prima facie wrongfulness. In
the new area of conduct not previously recognized as wrongful, there would be no prima
facie wrongfulness and therefore no rebuttable presumption of wrongfulness to assist
the plaintiff. It would be for the plaintiff to allege and prove circumstances justifying the
inference of law that the conduct complained of had been wrongful as well as
culpable.353 The first conduct so recognized in the new field was that of causing
patrimonial loss by the culpable use of words i.e. culpable, loss-producing
misstatement. Facts justifying the legal inference of the wrongfulness of such conduct
would have to be alleged and proved in each case. A similar approach has been
adopted in subsequent cases in the new field of Aquilian liability opened up by Trust
Bank.
[342] In my respectful view, the reference by Scott JA in the above-quoted passage
to wrongfulness gaining importance in cases of liability for pure economic loss cannot
be understood as detracting from those cases of so-called pure economic loss such as
Smit v Saipem, above, in which the right of certain non-owners to Aquilian relief for
patrimonial loss resulting from physical damage inflicted by a wrongdoer on corporeal
property in which the non-owner has an interest that has for centuries been protected
353 In this respect, Rumpff CJ was building on the decision in Minister van Polisie v Ewels 1975 (3) SA 590 (A) that, in the case of alleged Aquilian liability for an omission, wrongfulness is not presumed and must be established as an inference of law from the circumstances of the particular case: see Administrateur, Natal v Trust Bank van Afrika Bpk 1979 (3) SA 824 (A), at 831 H.
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by an Aquilian remedy. The learned judge's words can not have been intended to
suggest that in such cases the plaintiff would have to allege and prove wrongfulness.
In their context, his words mean only that in the new area of potential Aquilian liability
opened up by Administrateur, Natal v Trust Bank, in which the plaintiff must allege and
prove facts that justify the legal inference of wrongfulness, many, though by no means
all, cases will inevitably be cases of omission or pure economic loss. However, in cases
within the old, well-established area of application of Aquilian principles, the prima facie
inference, or rebuttable presumption, of wrongfulness will remain undisturbed, even in
cases such as Smit v Saipem in which, under the influence of English law, the plaintiff
is now said to have suffered 'pure economic loss'. Sea Harvest was a case of an
omission. At 838H-1 in paragraph [20], the learned judge stated that in the absence of
negligence, the issue of wrongfulness did not arise. The appeal was disposed of on the
basis that no negligence had been proved. Therefore, the issue of wrongfulness was
not decided.
[343] In The Oil Rig 'South Seas Driller': Sheriff of Cape Town v Pride Foramer SA
and Others, 354 the Sheriff instituted an action against the charterers of an oil rig for the
recovery on Aquilian principles of damages that he claimed to have sustained as a
result of negligent conduct for which the charterers of the rig were said to be liable. It
was alleged that the master, officers or crew of the oil rig had negligently failed to moor the rig securely and that it had broken loose in a gale and caused damage to other
vessels. The Sheriff had previously arrested a ship in the docks in Cape Town and had
bought the wage claims of the ship's crew against the vessel by paying them the
amount of their wages and taking cession of their claims. He had also paid for the
354 2001 (3) SA 841 (C).
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accommodation of the crew and the costs of their repatriation. He had expected to
recover all of these expenses from the proceeds of the sale of the ship, which he
anticipated would realize USD 800,000. Before the date of the sale had arrived, a gale
in Table Bay caused the moorings of the oil rig to part and the oil rig to blow about in the
harbour, damaging several vessels that came in its way, including the arrested ship.
As a result of the damage to the arrested ship, it realized no more than USD 225,000
which was insufficient to meet the expenses that the Sheriff had incurred. The sheriff
therefore claimed to have suffered patrimonial loss as a result of the negligent
damaging of property that did not belong to him but in which he had an interest. The
charterers of the oil rig (the defendants) excepted to the particulars of claim as
disclosing no cause of action against themselves on the part of the Sheriff.
[344 ] A contention that the matter was governed by English law was abandoned, and
the matter proceeded on the basis that South African law was applicable. 355 Conradie
J (as he then was) approached the matter on the footing that the Sheriff's claim was for
'pure economic loss'; that therefore the question to be decided was whether the alleged
wrongdoers had owed the Sheriff 'a duty of care to avoid negligent conduct causing him
pure economic loss'; that the duty of care concept was policy based; that it was a device
used by the courts to control the incidence of liability in delict for pure economic loss;
and that an important consideration was the fear of creating indeterminate liability. 356
[345] The learned judge took the view that the matter was not governed by previous
authority, so that it was one in which the court was called upon to determine on grounds
of legal policy whether the defendants had owed a legal duty to the Sheriff and, by
355 at 843D.
356 at 843E-G.
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breaching it negligently, had made themselves guilty of wrongful conduct. He said: 357
'Our law has not recognised the right of a creditor to sue a wrongdoer for
damage caused to his debtor's estate, not even where the damage is
caused to an asset of the debtor over which the creditor has established
security for his claim.'
In this way, the learned judge suggested an analogy between the situation there
outlined and the position of the Sheriff as a creditor of the ship he had arrested and sold
(or as a creditor of its owners), the arrested ship as the security for the Sheriffs claim,
and the defendants as the alleged wrongdoers against whom, he suggested further, our
law had not recognized that the creditor had any right of action.
[346] Conradie J also pointed out that the Sheriff was not without a remedy. The
former owners of the ship that had been arrested and sold would have retained a right
of action against the alleged wrongdoers. The Sheriff could attach that right of action
and pursue it against the defendants. 358
[347] Furthermore, the learned judge was of the view that liability on Aquilian
principles did not extend to the Sheriff in the circumstances for reasons of legal policy.
The oil rig, blown about in the gale, had damaged several other vessels and a crane
belonging to the harbour authority that had been used for loading and unloading
containers. Therefore the oil rig had probably caused large losses to many other
interests: to the owners or charterers of other vessels for costs of repair and demurrage;
to shippers of goods in the damaged and delayed vessels; to the harbour authority; to
the owners or shippers of all goods that would be delayed by the shipping delays or by
the inability of the damaged crane to load or unload them, so that the goods would have
357 at 843G-H.
358 at 843I – 844B.
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to be stored at extra cost and, in particular, to persons interested in perishable goods
needing preservation from spoiling. Although these damages would flow from the
unserviceability of the damaged vessels and the damaged crane, and not, as in the
case of the Sheriff's claim, more directly from the reduction in value of the arrested ship,
the learned judge was of the view that if Aquilian liability were to be held to embrace the
Sheriff's claim, it would expose the defendants to virtually unlimited liability.
[348] On each of three grounds, therefore, the exception to the Sheriff's claim was
upheld. First, the law was taken to be that the loss alleged by the Sheriff had been
merely 'pure economic loss', and that the Sheriff had therefore been required to allege
facts that would justify the inference of law that the wrongdoers had owed him a legal
duty. The Sheriffs allegations had failed to justify such an inference. Second, one of
the reasons for this failure was that the Sheriff's allegations had revealed that he
already had a remedy: he could attach the owner's claim against the defendants and
institute action on the strength of it. Third, another reason for the Sheriff's failure was
that legal policy would not expose the defendants to virtually limitless liability.
[349] In my respectful view, the first of these propositions is not reconcilable with the
law as stated in Smit v Saipem and Administrateur, Natal v Trust Bank. In Smit v
Saipem, it was held that a hire-purchaser had an independent right of action on Aquilian
principles, additional to the right of action enjoyed by the owner, against a wrongdoer
who had negligently damaged the property concerned. The hire-purchaser did not have
to try to get cession of the owner's right of action. The basis for the conclusion that he
had his own independent right of action was the long history of development of Aquilian
remedies which, even in Roman times, had granted such a remedy to not only the
owner of property that was damaged by a wrongdoer but also the pledgee of the
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property, amongst certain other kinds of possessors. This principle was received in
Roman-Dutch law, has come down to us in South Africa, and was one of the grounds
for the decision that a hire-purchaser has a right of action against a wrongdoer arising
out of damage to the property constituting the subject matter of the hire-purchase
contract, in addition to the right of action enjoyed by the owner of the property. Of
course, in The Oil Rig South Seas Driller the Sheriff was not a hire-purchaser. But he
had alleged that he was a creditor of the arrested ship (or its owners), that he held the
ship and its proceeds as security, and that it was in his capacity as a creditor with that
interest in the ship that he sued the defendants who were said to be responsible for the
negligence of the wrongdoers. From the point of view of the law, it seems to me, the
Sheriff was in a position closely analogous to that of a pledgee of property (i.e. a
creditor of the owner of the property) who, since Roman times, and later in accordance
with Roman-Dutch law as reaffirmed in Smit v Saipem, had been entitled to sue a
wrongdoer for his damages, to the extent of his interest in the property, resulting from
damage to the property caused by the negligent conduct of a wrongdoer. The
wrongdoer was presumed to have acted wrongfully unless he could justify his damage
causing conduct.
[350] With great respect, therefore, I differ from the view expressed by Conradie J
in The Oil Rig South Seas Driller to the effect that our law has not recognized the right
of a creditor to sue a wrongdoer for damage caused to an asset of his debtor over which
the creditor has established security for his claim. Smit v Saipem, it seems to me,
confirmed authoritatively that our law has for some hundreds of years recognized that
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such a creditor has such a right to sue a wrongdoer. 359 I would respectfully suggest that
the learned judge may have been misled by the belief that our law has adopted the
proposition that a plaintiff cannot in any circumstances recover what English law regards
as 'pure economic loss' from a wrongdoer, unless he, the plaintiff, can make and prove
certain additional allegations relating to a duty of care.
[351] It must be re-emphasized, I think, that since the decision in Administrateur,
Natal v Trust Bank in 1979, it has been clear that 'pure economic loss' is not relevant
as a criterion for identifying a case in which the plaintiff invoking an Aquilian remedy
must comply with the new requirement of alleging and proving facts that justify the legal
inference that the defendant owed him a legal duty and breached it. Those allegations
have to be made in respect of 'new' cases of alleged Aquilian liability (i.e. cases not
already recognized by authority prior to 1979). The prime example of 'new' cases to
which this new requirement applies is any case in which the plaintiff seeks to recover
patrimonial loss caused by the negligent use of words. In the nature of things, the loss
caused by misstatements will usually be purely economic. However, cases of a
misstatement causing physical damage or personal injury and resulting in patrimonial
loss can be imagined. 360
[352] In Lillicrap, the Appellate Division took the view that the plaintiffs' attempt to
invoke Aquilian principles in the field of liability for the negligent performance of
359 In this respect, I have not been made aware of the authority which may underlie the learned judge's proposition at 843H, to the effect that a banker holding a mortgage bond over a building as security for the repayment of a loan has no claim, according to our law, against someone who has negligently set fire to the building. I am therefore not in a position to know how such a case is to be distinguished from the law as reflected in Smit v Saipem and Administrateur, Natal v Trust Bank. On the face of it, I would not expect it to be distinguishable, and I would expect that the mortgagee did indeed have a remedy against the wrongdoer, to the extent of the mortgagee's interest in the mortgaged property.
360 For example, someone shouting 'Fire! Fire!' in a crowded cinema when there was no fire, and thereby causing panic and a stampede in which doors and furniture are broken and persons are injured and have medical expenses, would cause patrimonial loss that was not 'pure economic loss'.
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professional services rendered pursuant to a contract, envisaged opening a new field
of application for such principles. 361 They therefore examined the question whether the
plaintiffs' allegations justified the legal inference that the defendants had owed the
plaintiffs a legal duty independently of contract. They found that no such inference was
justified in the circumstances of that case.
[353] However, in my respectful view, there is nothing in Administrateur, Natal v Trust
Bank that alters the law as it existed prior to 1979 otherwise than by recognizing that
Aquilian principles are applicable, subject to the new requirement that I have mentioned,
to the 'new' field of liability for patrimonial loss caused by words, and therefore also to
other 'new' fields in which Aquilian liability has not previously been authoritatively
recognized.
[354] As regards the 'old' fields of application of Aquilian principles, nothing was
changed by the decision of Administrateur, Natal v Trust Bank. In matters arising in
those established old fields, the fact that the patrimonial loss complained of is so-called
'pure economic loss' is not, and has never at any material time been, a criterion
constituting a necessary bar to Aquilian liability. Aquilian liability on the part of a
wrongdoer for so-called 'pure economic loss' sustained by a non-owner in certain
specified circumstances, and its potential for expansion into wider fields of application,
has existed for the rnany hundreds of years since Roman law began to extend an
Aquilian right of action to certain non-owners, such as pledgees, borrowers for use and
other categories of possessors with responsibilities to the owner, and progressively
extended it further. The non-owner's right of action for 'pure economic loss' was limited
by the extent of his interest in the property damaged, which in turn was related to his
361 Lillicrap, at 500A-D.
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responsibilities to the owner. With this built-in limitation, no question of 'limitless liability'
could arise to trouble the Roman lawyer.
[355] Prior to Administrateur, Natal v Trust Bank in 1979, a plaintiff invoking an
Aquilian remedy therefore did not have to allege or prove facts to justify the legal
inference that the conduct of the defendant alleged to have caused the patrimonial loss
had been wrongful. Such 'wrongfulness' was rebuttably presumed from the fact that the
defendant was alleged to have damaged property (whether the plaintiff's property, or
another person's property in which the plaintiff had an interest of a kind specified by
law) and in certain cases from the fact that the defendant was alleged to have caused
patrimonial loss even without physical damage to property. 362 It was for the defendant
to show, if he could. some legal justification for his prima facie wrongful conduct. Since
1979, that state of affairs has not changed in respect of an action on Aquilian principles
within the 'old' ambit recognized by authority before 1979. It is only in the 'new' field of
Aquilian liability for patrimonial loss caused by words, and any other 'new' field of such
liability explored since 1979, that the plaintiff has the onus of alleging and proving facts
to justify the legal inference that the defendant's conduct was unlawful.
[356] Although pure economic loss is irrelevant, in terms of our law, for the main
purpose of identifying a 'new' field of application of Aquilian principles, and therefore a
'new' type of case in which the plaintiff must prove the unlawfulness of the defendant's
conduct, it is not necessarily entirely irrelevant for all purposes. It is a factor that, in the
context of some 'new' cases at least, would need consideration, together with other
relevant factors, for the purposes of limiting the extent of a defendant's Aquilian liability.
362 E.g. the negligent failure to register a deed in good time.
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Conclusion in respect of 'pure economic loss'
[357] For the reasons I have given, I am respectfully but firmly of the view that the
present case is not governed by the decisions in Shell & BP v Osborne Panama
(above), Osborne Panama v Shell & BP (above) or The Oil Rig 'South Seas Driller'
(above). I consider that, for the purposes of the exceptions before me, the question
whether or not the losses complained of by the plaintiffs constitute 'pure economic loss'
is irrelevant to a determination of one of the main questions that remain to be decided.
It is the question whether the plaintiffs' allegations bring the present case within the field
of 'new' applications of Aquilian principles, so that the requirement of Administrateur,
Natal v Trust Bank that the plaintiffs should establish a legal duty on the part of the
second defendants to them must be met; or whether the present case in fact falls withinthe well-established category of 'old' applications of Aquilian principles in respect of
which the wrongfulness of the conduct attributed to the second defendants is rebuttably
presumed, and it is for the second defendants to show lawful justification for their
conduct if they can.
[358] In the course of argument, I was referred to many cases decided in England,
and in other common law jurisdictions, relating to the position of a person ('the victim')
who has suffered 'pure economic loss' as a result of the conduct of another ('the alleged
tortfeasor'). It appears that English common law, since the decision in Hedley Byrne
(above) in 1963, travelled first in the direction of fairly liberal extensions allowing the
victim to recover pure economic loss from the alleged tortfeasor, and that it later
363 Compare Administrateur, Natal v Trust Bank, at 832H in relation to the 'begrensingsprobleem'.
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backtracked to a more conservative approach. In England, certain aspects of the
problem have been regulated by the legislature, to the extent that they have seen fit.
The Defective Premises Act 1972 is an example of such legislation. Of the other
common law jurisdictions, it seems that some have substantially followed the lead of
English law while others have continued on the more liberal path that was thought to
have been opened up by Hedley Byrne.
[359] Counsels' researches into these developments in diverse directions in the
English common law jurisdictions have been industrious and have produced interesting
results. I bear in mind the constitutional power of the court to develop our own common
law and to take account of foreign law in so doing. Nevertheless, I have come to the
conclusion that it has not been shown that there would be any benefit to our legal
system if, for the purposes of the decision in the present matter, I were to draw from the
vacillating and uncertain jurisprudence that has emerged from those foreign jurisdictions
in this particular field. In my view, the position remains as recognized by Rumpff CJ in
Administrateur, Natal v Trust Bank in 1979: our civil law heritage has provided us with
a set of principles that provide a means of solving these problems that is superior to the
essentially casuistic approach of the English common law jurisdictions in this field. For
that reason, I do not intend to discuss the many foreign cases to which counsel have
referred me.
Must the plaintiffs allege facts that iustify the legal inference that the second defendants
owed them a legal duty and conducted themselves in a manner that breached the duty
so that their conduct was unlawful?
[360] Counsels' submissions were to the effect that it was the case of both
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defendants as excipients that, on the strength of Lillicrap and Administrateur, Natal v
Trust Bank, the plaintiffs had not set out a valid cause of action against the second
defendants on Aquilian principles. Indeed, the plaintiffs could not do so without alleging
wrongfulness on the part of the second defendants. The plaintiffs had been required to set out facts justifying the inference of law that the second defendants had owed the
plaintiffs a legal duty to conduct themselves in a particular way and had breached that
duty. However, in both claim III and claim V, the plaintiffs had set out a case against
the second defendants that was essentially indistinguishable from the plaintiffs' case in
Lillicrap. Therefore, for reasons similar to those in Lillicrap, the allegations of the
present plaintiffs did not disclose that the second defendants had owed a legal duty to
them that was independent of their tripartite relationship. They had consequently failed
to set out a cause of action against the second defendants in claim V and the exception
to that claim should accordingly be upheld. With regard to claim III, the foundation on
which the allegation of vicarious liability on the part of the first defendant had been
made in claim III had failed with the failure of claim V, and claim III was accordingly also
bad in law.
[361] On the other hand, Mr Klevansky for the plaintiffs submitted that Lillicrap was
to be distinguished from the present case on a number of grounds that I shall deal with
one after the other.
[362] First, Mr Klevansky submitted that the relationship between the present three
parties was not tripartite in the sense in which that term had been used in Lillicrap. 364
On the contrary, their relationship was comparable with that of the parties to
364 Lillicrap, at 494E-G; and 502H - 503A.
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Tsimatakopoulos v Hemingway, Isaacs & Coetzee CC and Another. 365
[363] In Tsimatakopoulos, one Crawford, the second defendant, had engaged the
first defendant CC to design a retaining wall for the boundary of his property. The first
defendant CC had provided the services of qualified engineers including, amongst other
services, those of structural engineering. They had designed a retaining wall which, as
afterwards appeared, was not designed appropriately to withstand the pressures of the
earth that it was intended to retain on one side. Crawford had the wall built according
to the design. Within a year, and before the wall's deficiency had become apparent,
Crawford had sold the property to Ms Tsimatakopoulos, the plaintiff. Soon after the
plaintiff had occupied the property the wall had begun to lean over and its previously
hidden defects had became apparent. The plaintiff, who had not had any contractual
connection with the first defendants, sued them in delict for the cost of replacing the
wall. She also sued the person from whom she had bought the property, Crawford, in
contract. However, the latter had become insolvent and his estate had been
sequestrated. Neither he nor his trustee-in-insolvency took any part in the legal
proceedings. In terms of Rule 33(4) the court separated the issue of whether the first
defendants had owed a legal duty to the plaintiff from all other issues, and dealt with
that issue first.
Farlam J (as he then was) had rejected 366 a contention on behalf of the defendant
engineers that Lillicrap, at 501G-H, had established that there could be no delictual
liability for the breach of a contract of professional employment. Indeed, the learned
judge had pointed out that Lillicrap had reaffirmed that our law admits of a concurrence
365 1993 (4) SA 428 (C).
366 Tsimatakopoulos (above), at 432B - 433G
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of delictual and contractual remedies arising out of the same facts provided that the
breach of legal duty on which the delict is founded is independent of the contract.
Therefore, a professional engineer could be liable both in contract and in delict to the
same plaintiff if the prerequisites for such liability were met. A fortiori, he could be liable
in negligence to anyone to whom he owed a legal duty if he had no contract with that
person.
[364] In my judgment, Mr Klevansky's reliance on Tsimatakopoulos was misplaced.
It was a straightforward case of an engineer who had contractual duties to one person,
Crawford, and other legal duties arising outside the field of contract to persons whom
he could and should reasonably foresee would be likely to suffer harm as a result of his
negligent design of the wall. It was held that he could and should have foreseen that
Crawford might sell the property and that a negligently designed wall that was likely to
fall over would cause harm to the purchaser. The engineer was accordingly held to
have owed a legal duty to any future purchaser of the property from Crawford, to design
the wall with the care and skill of a reasonable structural engineer, and to have
breached that duty, and therefore to have caused patrimonial loss to the purchaser
through his wrongful and negligent conduct. He was accordingly held liable to the
purchaser on Aquilian principles.
[365] What was different in Lillicrap was that, upon the assignment of the engineering
consultancy contract from Pilkingtons to Salancs in March 1976, the privity of contract
between Lillicraps and Pilkingtons was terminated and replaced by the privity between
Lillicraps and Salancs. At the same time, Pilkingtons engaged Salancs in terms of the
construction contract. The three parties were thereafter bound to each other in a chain
relationship by contracts that were both concerned with the same construction
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enterprise. Pilkingtons and Salancs were bound to each other by the rights and
obligations defined in the construction contract, and Salancs and Lillicraps were bound
to each other by those defined in the engineering consultancy contract. There was no
longer privity of contract between Pilkingtons and Lillicraps. Nevertheless, the two
contracts were by no means unrelated to each other. On the contrary, they linked the
three parties in a chain by means of which they were to work together on a common
enterprise. This was referred to as a 'tripartite relationship'. It did not imply that there
was privity of contract between Pilkingtons and Lillicraps. It was well recognized that
the assignment had been intended to put an end to it and had done so. However, it was
held, for the reasons set out more fully in the judgment, that it could not be assumed
that the parties had intended that the relationship between Pilkingtons and Lillicraps
would thereafter be governed by the law of delict. To make any such assumption would
be to impose upon the parties rights and obligations that would be inconsistent with their
tripartite relationship in various ways. It was reasonable to accept that the parties had
included in their contracts such rights and obligations as they considered that they
needed, to the exclusion of the rules of the law of delict, at least so far as such rules can
be excluded by agreement, and to the extent that such rules would be inconsistent with
the contractual arrangements of the tripartite relationship chosen by the parties.
[366] In my view, Tsimatokopoulos plainly does not deal with a similar or an
analogous situation. I do not see anything in Tsimatokopoulos that demonstrates or
points to any material difference between Lillicrap and the present case.
[367] Next, Mr Klevansky submitted that there was nothing in the particulars of claim
to suggest that the plaintiffs, when they concluded the building contract, 'had knowledge
of the terms or provisions of the consultancy agreement'.
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In my view, there was no merit in this submission. The building contract itself told
the plaintiffs that there would be an 'Engineer' as defined in GCC 1(1)(m) and how the
initial holder of that office was to be identified, and that he could be replaced by the first
defendant from time to time. 367 GCC 2 368 informed the plaintiffs generally of the duties
and powers of the Engineer, and that he would administer the building contract as agent
of the first defendant. Other, more specific duties and powers of the Engineer were
detailed elsewhere in the building contract. In GCC 6(3), 369 the plaintiffs bound
themselves to comply with the Engineer's instructions. It is quite apparent that the
plaintiffs concluded the building contract knowing that the first defendant had a contract
with the Engineer (the second defendants) in terms of which he was to act as their
agent with powers at least partly defined in the building contract. They certainly did not
conclude the building contract in ignorance of the fact that they would be subject to the
instructions and the exercise of other powers by the Engineer. If they had wanted to
know more about the contract between the first and second defendants before signing
the building contract, they were obviously free to ask to see it. Nothing could compel
them to sign the building contract without having seen the consultancy agreement if they
had wanted to read it. Moreover, they were free to stipulate for a contractual
relationship between themselves and the second defendants if that was what they had
wanted. Nothing compelled them to submit themselves to any measure of control by
the second defendants as Engineer if they did not wish to do so without direct
contractual rights against them. However, the fact is that the plaintiffs were content with
367 p 179.
368 p181.
369 p 183.
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their contractual rights against the first defendant, knowing that he would have such
responsibility for the acts of his agent as was defined or implied by the building contract.
They must undoubtedly be taken to have entered into the building contract on the basis
that they were content with the arrangements between the first and second defendants,
whatever further details they may have contained that were not reflected in the building
contract. Indeed, they have made the consultancy agreement part of their particulars
of claim, and they have not pointed to any provision in it that they consider to be
objectionable or that took them unawares or prejudiced them in any way.
Therefore, I find no substance in the submission that nothing in the particulars of
claim shows that the plaintiffs had prior knowledge of the terms and provisions of the
consultancy agreement.
[368] Mr Klevansky went on to submit that Lillicrap had reaffirmed that the same facts
may give rise to a claim in contract and a concurrent claim in delict. He also referred
to subsequent cases that repeated this proposition. He stressed the fact that the mere
existence of a contractual relationship between parties does not necessarily preclude
the possibility of one of them becoming liable in delict to another.
[369] In this regard, Mr Klevansky relied in particular on the decision of Coetzee J in
Cathkin Park Hotel and Others v J D Makesch Architects and Others, 370 in which the
building owners had made a claim in delict against both the architect and the builder,
despite the existence of what appears to have been a tripartite contractual relationship
between the parties, not dissimilar to that in Lillicrap. Exceptions taken by the two
defendants to the particulars of claim failed.
[370] For present purposes, the essential point of difference between Lillicrap and
370 1993 (2) SA 98 (W).
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Cathkin Park was that in the latter case, the plaintiffs had alleged that the defendants
had negligently designed (in the case of the architect), and negligently built (in the case
of the builder), a fireplace that was obviously a hazard that created the danger of
physical damage to, or the destruction of, the building by fire. The contracts as pleaded
did not preclude liability in delict on the part of either of them for the consequences of
the negligent conduct alleged. The claim, being one that arose out of physical damage
to the first plaintiff's property alleged to have been caused by both defendants, was one
that was well within the 'old' field of delictual liability recognized before the decision of
Administrateur, Natal v Trust Bank in 1979. No recognition of the application of Aquilian
liability to an extended field of liability was involved, as had been the case in Lillicrap.371
Coetzee J held that the plaintiffs had made allegations which, if proved, would establish
a valid claim in delict, and he dismissed the exceptions.
[371] Cathkin Park went further. The plaintiffs' claims against all of the defendants
except the builders were settled or withdrawn, and the matter went to trial against the
builders alone. They were found liable to both plaintiffs, and they appealed to the
Supreme Court of Appeal. The judgment of Harms JA, concurred in by the other
members of the court, is reported as S M Goldstein & Co (Ply) Ltd v Cathkin Park Hotel
(Ply) Ltd and Another. 372 One of the contentions raised on behalf of the appellant
builders was that the terms of the building contract had served to protect them from
liability in delict, first, because they had complied with a contractual obligation to build
in accordance with the design and instructions of the architect; and second, because
the contract contained a clause exempting the builders from liability for the design of the
371 Cathkin Park Hotel (above), at 102.
372 2000 (4) SA 1019 (SCA).
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works by the architect.
[372] The first point failed on the ground that it overlooked the fact that the contract
also made the builders responsible for all aspects of construction and in particular
required them to follow the directions of the manufacturer of the fireplace, which, in
following the architect's design and instructions, the builders had failed to do.
Furthermore, the contract had required the builders, in case of a conflict between the
manufacturer's directions and the architect's, to notify the architect and obtain
clarification and a variation order. The builders had not done so. Therefore the
contractual requirement to build in accordance with the architect's design did not avail
them as a defence to the claim in delict. 373
[373] As to the exempting clause, it was held to be inapplicable as a defence to the
claim in delict because its purpose was to protect a builder who complied with his
contractual obligations, against liability for faulty design on the part of the architect. Its
purpose was not to provide to a builder who had failed to comply with his contractual
obligations with a defence to the effect that there had been contributory negligence on
the part of the architect. 374
[374] An interesting aspect of the S M Goldstein case is that the allegations of the
second plaintiffs, the lessees of the hotel that was damaged by the fire, indicated that
they were not the owners of the damaged property. Therefore, according to the
definition of 'pure economic loss' put forward in LAWSA 375 and apparently derived from
English law sources, the patrimonial loss sustained by the second plaintiffs was 'pure
373 S M Goldstein & Co (above), at 1024, par's [7), [8] and [9].
374 S M Goldstein & Co (above), at 1026, par [12].
375 LAWSA, vol 8, part 1 (2nd ed, 2005), Delict, par 68.
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economic loss'. As I have pointed out above, the fact that their loss may have been
purely economic according to that definition, is neither here nor there so far as concerns
our own law relating to the ambit of Aquilian liability before 1979. On the strength of
Smit v Saipem, the question is whether the second plaintiffs, although not the owners,
had such an interest in the property that was damaged as afforded them a right of
action against the wrongdoer independently of the right of action of the owners (the first
plaintiffs). Although this question was not expressly dealt with either in the judgment
of Coetzee J on exception or in the judgment of Harms JA on appeal after the trial, it is
noteworthy that neither court rejected the claim of the second plaintiffs on the ground
that they had merely suffered pure economic loss.
[375] In my view, it is clear that neither Cathkin Park nor S M Goldstein & Co is of
any assistance to the plaintiffs in the present case in their attempt to demonstrate that
the tripartite relationship between the parties, unlike the tripartite relationship in Lillicrap,
does not preclude Aquilian liability on the grounds alleged in claims III and V. Mr
Klevansky submitted correctly that each case depends upon its own particular facts or
factual allegations. Naturally, these include the terms, both express and implied, of the
contracts concerned. In some cases, of which Lillicrap was one, the contract or
contracts preclude delictual liability in respect of matters validly dealt with in the
contracts, expressly or by implication. In other cases, such as Cathkin Park and S M
Goldstein & Co, the terms of the contracts, express or implied, may not preclude the
delictual liability alleged, or the contractual prerequisites for contractual protection
against delictual liability may not have been met.
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Concurrent rights of action in contract and delict
[376] Mr Klevansky submitted that the present case, unlike Lillicrap, is not one in
which the plaintiffs are pursuing rights of action in delict that are concurrent with rights
of action in contract. In this regard, he referred to the article on 'Concurrence of
Actions' in LAWSA. 376 It seems that the term 'concurrence of actions' is sometimes
used inaccurately to refer to 'overlapping of actions', and sometimes more precisely to
refer to a true 'concurrence of actions'. A true concurrence of actions arises when a
particular event results in the plaintiffs being vested with both a right of action for
damages for patrimonial loss resulting from a breach of contract and an independent
right of action in delict against the same defendant to recover the same patrimonial loss.
An 'overlapping of actions', on the other hand, occurs when an event, such as a
negligently performed operation by a surgeon on a patient, infringes different rights and
gives rise to damages that are not necessarily confined to the same patrimonial loss.
Such an operation would constitute a breach of contract affording the patient a
contractual right of action for damages that will place him in the position he would have
enjoyed if the operation had been properly performed. It would also constitute a delict,
in the form of a wrongful infringement of his personality right to his bodily integrity,
affording him a right of action that could, in certain circumstances, entitle him to non
patrimonial damages (including sentimental damages for disfigurement, pain and
suffering, wounded feelings and so on) that would not ordinarily be recoverable in
contract unless specifically stipulated for, as well as to compensation for his patrimonial
loss, which would ordinarily be included in damages payable for such a breach of
contract. There would be overlapping claims for the patrimonial loss in the two rights
376 LAWSA, vol 8, part 1 (2nd ed, 2005), Delict, par 53.
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of action, but they need not be precisely concurrent.
[377] One of the main points to this distinction is summed up as follows in LAWSA
(with footnotes omitted): 377
'The decision either to allow concurrence of actions or to refuse a second
action is founded in policy. In deciding the issue, the court is not concerned
with whether the elements of a delict are present, or whether a breach of
contract has in fact been established. The court is involved in a separate
inquiry into whether the plaintiff should have a right to prove a delictual
claim against the defendant.'
The criterion according to which the question is dealt with by the court is the general
criterion of reasonableness.
[378] In claim V, the plaintiffs sue the second defendants in delict. They have no
other cause of action against the second defendants. Therefore there is no question
of a concurrence of the action in claim V with any other action. There is of course no
question of concurrence between claims III and V. They are against different
defendants.
[379] All that may be so, but it does not provide an answer to the defendants'
exceptions. A single event, the collapse of the partly built Injaka bridge, has given rise
to all of the plaintiffs' claims. In terms of the building contract, the plaintiffs' claims I, II
and IV are contractual claims for the amounts set out in schedules X2, X3 and the
prayer to claim IV (Prayer 1.2.6).378 In claim III, the plaintiffs again claim from the first
defendant, in delict, the precise amounts claimed in schedules X2 and X3, which have
been repeated in schedule X4 for the purposes of claim III (in which no claim equivalent
to prayer 1.2.6 has been made).
377 LAWSA, vol 8, part 1 (2nd ed, 2005), Delict, par 53, p 70, second paragraph (unnumbered).
378 p 82.
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[380] So far as concerns the plaintiffs' claims against the first defendant, other than
claim IV, it seems to me that the question whether the plaintiffs are attempting to assert
concurrent claims properly so called, does indeed arise. If that is their endeavour, the
further question whether, in accordance with the general criterion of reasonableness,
such concurrent claims should be recognized, also arises.
[381] In respect of the second defendants, Mr Klevansky has rightly pointed out that
no question of concurrent claims arises. In their case, the main questions are
1. whether the plaintiffs' claim in delict is for the application of Aquilian principles
within the 'old' field of liability recognized by authority prior to Administrateur,
Natal v Trust Bank in 1979, or whether it is for the application of such principles
to 'new' circumstances not recognized by pre-1979 authority; and
2. if the latter, whether the plaintiffs have alleged facts that establish that the
conduct attributed to the second defendants was wrongful.
[382] Reverting to the first defendant, it seems to me that whether or not the
plaintiffs are attempting to assert concurrent claims, properly so called, against him, the
questions arising in respect of claim V against the second defendants inevitably affect
the outcome of the questions surrounding claim III against the first defendant. If claim
V is bad in law, claim III is no better. If claim V is sound, claim III still faces the
challenges
1. that no grounds of vicarious liability have been set out;
2. that it is not a claim that merely overlaps certain contractual claims, but is an
attempt to assert a concurrent claim in delict which, in terms of the general
criterion of reasonableness ought not to be entertained.
I shall deal with these questions in relation to the specific grounds of exception, to which
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I now turn, starting with claim V(1).
The second defendants' specific grounds of exception to Claim V(1)
[383] As far as possible, I shall deal with the second defendants' two exceptions
simultaneously, i.e. their exception that the allegations in claim V(1) lack averments
necessary to sustain a cause of action, 379 ('the first exception'), and their exception that
certain of the plaintiffs' allegations are vague and embarrassing 380 ('the second
exception').
Ad paragraph 84
[384] In their first exception, the second defendants state: 381
'1. In paragraph 84 of its Particulars of Claim the Plaintiff pleads that the
Second Defendant assumed certain obligations "in performing its
obligations as the agent of the First Defendant in relation to the scrutiny
and approval of the temporary works drawings submitted by the Plaintiff'.
2. The Plaintiff does not allege that such obligations were owed by the Second
Defendant to it.'
In their second exception, 382 they say that paragraph 84 is vague and embarrassing
because it does not state to whom the obligations were owed, or the basis on which the
alleged obligations came into existence, or whether they were contractually or delictually
based.
[385] As I have noted above, there is, at first sight, ambiguity in the allegation that
379 Pleadings, pp 674 to 682.
380 Pleadings, pp 692 to 700.
381 Pleadings, p 675.
382 Pleadings, p 693.
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the second defendants 'assumed' the obligations in question. However, as I have
demonstrated above, it is clear enough that the origin of these alleged obligations was
the consultancy agreement between the first and second defendants, and that the
second defendants therefore owed the obligations to the first defendant. 383 Theambiguity arises because, if that were all that the allegation is intended to convey, it
would have no place in what is plainly intended to be a delictual claim against the
second defendants.
[386] In this regard, it is also clear enough that when two parties, such as the first
and second defendants, have concluded a contract, such as the consultancy
agreement, the breach by one of them of a contractual obligation owed to the other is
not ordinarily a wrongful act infringing any right of a third person (such as the plaintiffs)
who is not a party to the contract. Of course, if the act that constituted a breach of
contract happened to be conduct which, at the same time, caused patrimonial loss to
a third person, wrongfully and intentionally or negligently, the third person might well be
found to have an Aquilian remedy against the wrongdoer. For example, if a builder
breaches a term of a building contract by negligently erecting a structure with an unsafe
wall, which falls and causes damage to the neighbouring property, the builder will incur
liability to his employer for breach of contract and to the owner of the neighbouring
property in delict. However, the latter liability would be an entirely independent and
coincidental matter. The third person's right of action in delict would not be derived from
the breach of contract even if the breach of contract provided the occasion for the delict.
Accordingly, the plaintiffs' allegation cannot reasonably be understood to be laying the
basis for any such merely coincidental occurrence.
383 See especially Consultancy Agreement, pp 534 - 535, para's 4.1, 4.2, 4.6.1, 4.6.2, 4.7; and pp 539 -541, para's 11.2, 11.2.4, 11.2.5, 11.2.6, 11.3.2, 11.4, 11.4 4, 11.4.5, 11.4.7, 11.4.8.
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[387] In my judgment, the allegation in paragraph 84, taken in the full context of the
plaintiffs' claims, can reasonably be understood to mean that the obligations in question
were not only contractual obligations that the second defendants owed to the first
defendant, but that they were at the same time, by virtue of the tripartite relationship,
obligations arising from a legal duty owed by the second defendants to the plaintiffs.
The allegation must accordingly be understood in that way for the purposes of the
exception. I am therefore of the view that the suggestion in the second exception that
paragraph 84 renders claim V(1) vague and embarrassing, fails.
[388] However, that is not an end of the matter. A further question arises, in terms
of the first exception. Is the implied allegation that the obligations in question
(undertaken as they initially were by the second defendants to the first defendant in
. terms of the consultancy agreement) have also been imposed by the law of delict on the
second defendants as obligations owed to the plaintiffs, sustainable in law? The
answer, it seems to me, depends upon whether, or to what extent, Lillicrap governs the
present matter.
[389] Although counsel were in agreement that the present matter is one of 'pure
economic loss', as Lillicrap was found to be, I am not satisfied that it is. In any event,
for the reasons that I have already given, I consider that the question of 'pure economic
loss' is not, in our law, a relevant criterion for the purpose of determining Aquilian
liability, even though it is relevant as a policy factor to be given due weight when
considering the dangers of opening the door to 'indeterminate liability'.
[390] One of the reasons advanced for the submission that the loss alleged by the
plaintiffs is pure economic loss, was that the plaintiffs were not the owners of the bridge.
However, the fact that they were not the owners is also irrelevant. As appears from the
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decision in Smit v Saipem (above), and the long history of the relevant rules of Roman
and Roman-Dutch law, and of South African law, that preceded that decision, there are
a variety of non-owners who have rights of action in delict, on Aquilian principles,
against wrongdoers who cause damage to property belonging to a third person. What
such non-owners have in common is that they have possession of the property of the
third person, and obligations to that third person as the owner of the property. It is that
'interest' in the damaged property, which usually implies that the possessor carries the
risk of damage to or the loss or destruction of the property, or some part of that risk, that
is the foundation, in our law, of such a non-owner's delictual claim against the
wrongdoer. It is a claim independent of the owner's claim, and it is limited to the extent
of the possessor's interest in the property. That such non-owner's loss may be
described, in a term borrowed from English law, as 'pure economic loss' is irrelevant to
the existence of his right of action according to our own law.
[391] One of the categories of non-owner having such a right of action against a
wrongdoer who damages or makes away with the corporeal property of a third person
in the non-owner's possession, is a pledgee. He has a real right in the property. In the
present matter, the plaintiffs, at least at the time when the partly built bridge collapsed
if not when these proceedings were instituted, held a builder's lien over the bridge that
they were constructing. The existence of the lien is acknowledged in the building
contract. 384 It may well have been arguable that, in terms of our law, the plaintiffs' lien, as a real right in the building site of the bridge, afforded them an Aquilian right of action
against a wrongdoer who wrongfully damaged the partly built bridge belonging to the
384 GCC 59(2)(b), at p 216, where it was agreed between the plaintiffs and the first defendant that, if the plaintiffs (as 'the contractor') had to cancel the building contract, they would have to remove unused materials, constructional plant and temporary works from the site, and could do so 'without prejudice to his lien on the Employer's property'.
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first defendant (subject, of course, to the consistency of such a right of action with the
contractual arrangements).
[392] However, the plaintiffs have not relied on the lien they once enjoyed. Nor have
they relied in any other respect on the right of possession of the partly built bridge that
they enjoyed at the time of the collapse of the bridge on 6th July 1998 for the delictual
right of action that they claim to assert.
[393] As a result, it appears to me that the plaintiffs do not rely on any of the
categories of Aquilian liability that had been authoritatively recognized in our law before
the decision of Administrateur, Natal v Trust Bank in 1979. The plaintiffs are asking for
the recognition of the application of Aquilian principles to a situation that is 'new' in the
same sense as in Trust Bank in 1979 and in Lillicrap in 1985. They must therefore
formulate their delictual claims in a manner that complies with the requirements laid
down in those cases, so far as they are applicable.
[394] From Trust Bank arises the need to allege and prove facts that justify the legal
inference that the second defendants owed the plaintiffs a legal duty, and breached it,
so that the second defendants will be shown to have conducted themselves 'wrongfully'
towards the plaintiffs. Paragraph 84 of the particulars of claim is aimed at alleging such
a duty. Whether it has done so validly, depends upon the applicability or otherwise of
Lillicrap.
[395] I have already dealt with Mr Klevansky's submissions to the effect that Lillicrap
is distinguishable, or inapplicable. I have not been able to uphold any of those
contentions. In my judgment Lillicrap is not distinguishable, and it is applicable in the
following respect. In Lillicrap, it was recognized that where three parties to a common
enterprise, such as a construction project, arrange their affairs in such a way that one
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of them ('the first party') confines his rights and obligations to those specified in a
contract ('the first contract') with one only of the other two ('the second party'), and the
latter has a further contract ('the second contract') with the third party in terms of which
the third party's rights and obligations are confined to the second contract, the tripartiterelationship produced by these contractual arrangements may be found to have the
effect of eliminating certain rights of action in delict that the first party might otherwise
have had against the third party. I do not understand Lillicrap to have laid down as a
principle of law that such a tripartite relationship necessarily has that effect in every
case. It must depend upon the terms of the contracts and the nature of the Aquilian
claim that one of the parties not in privity with the other (the first and third parties in my
example) may afterwards wish to assert against the other.
[396] In Lillicrap, Pilkingtons wished to assert an Aquilian claim against Lillicraps
arising out of alleged shortcomings in Lillicraps' performance of contractual obligations
which, at the relevant time after the assignment, Lillicraps owed to Salancs (and no
longer to Pilkingtons). However, in respect of the very shortcomings of which
Pilkingtons complained, Pilkingtons had such contractual remedies against Salancs as
they had seen fit to stipulate for and Salancs to concede, and Salancs in turn had such
contractual remedies against Lillicraps as they had seen for to stipulate for and Lillicraps
to concede. It was in these circumstances, and in relation to such claims, that the court
held that the tripartite relationship had had the effect of precluding the intervention of
the law of delict to impose an additional legal duty on Lillicraps to afford to Pilkingtons
a performance of a standard regulated by the terms of the law of delict when, in terms
of the tripartite relationship, it was Salancs alone who had the right to demand a
performance from Lillicraps, and the standard of the performance that Lillicraps were
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obliged to deliver was regulated by the terms of the contract.
[397] In my judgment, the same situation obtains in the present matter. The three
parties arranged a tripartite relationship similar to that in Lillicrap. There is no privity of
contract between the plaintiffs and the second defendants. Therefore, the plaintiffs
have alleged in a number of paragraphs, of which paragraph 84 is one, that the second
defendants were bound to them (the plaintiffs) by a series of obligations said to have
been imposed on them (the second defendants) by the law of delict. Yet the alleged
delictual obligations relate to matters regulated partly by the consultancy agreement, in
terms of which the first defendant alone has rights against the second defendants, and
partly by the building contract, in terms of which the plaintiffs have rights of action
against the first defendant alone and no rights against the second defendants. Of
course, the plaintiffs' contractual claims against the first defendant form no part of the
allegations making up the delictual claim against the second defendants, claim V(1).
Nevertheless, the building contract is attached to the particulars of claim and the
plaintiffs' rights against the first defendant can be seen from the contract. It is therefore
not irrelevant to point out, when considering claim V(1), that the plaintiffs have
themselves set out their contractual rights of action against the first defendant in claims
I, II(1)(Part A), II(1)(Part B) and II(2). These claims are for precisely the same amounts
as the plaintiffs wish to claim from the second defendants in delict.
[398] Moreover, the consultancy agreement is also attached to the particulars of
claim, and it shows that the first defendant in turn has rights of action against the
second defendants, including rights deriving from the very provisions on which the
plaintiffs base their allegations that the law of delict has bound the second defendants
to the plaintiffs on the same terms as the second defendants agreed to be bound by
----
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contract to the first defendant alone.
[399] In my judgment, subject to one reservation that I have already mentioned and
shall repeat below, the situation is indistinguishable from the situation in Lillicrap. As in
Lillicrap, the tripartite relationship established by the two contracts in the present matter cannot be regarded as a mere background incident that happened to bring the
parties together and did no more than to create the occasion for the second defendants
to commit a breach of a legal duty that they owed to the plaintiffs independently of the
contracts. On the contrary, the plaintiffs' allegations in claim V(1) relating to the second
defendants' obligations, and in particular the allegations in paragraphs 83 and 84, draw
their substance from the contracts and especially from the consultancy agreement. I
should re-emphasize that there is no need to invoke the allegations in the contractual
claims to reach this conclusion. It is apparent from the allegations in claim V(1) read
with the contracts annexed to the particulars of claim. Paragraph 84 relates to
obligations defined in the consultancy agreement and owed by the second defendants
to the first defendant. The further implied allegation that the second defendants owed
substantially the same obligations to the plaintiffs, imposed in terms of the law of delict,
lacks the independent basis that would be necessary to justify the suggestion that the
law of delict had intervened in this way.
[400] Therefore, I hold that the allegation in paragraph 84, to the effect that the
second defendants owed to the plaintiffs obligations in substantially the same terms as
the contractual obligations that the second defendants undertook to the first defendant
alone, with its implication that it was the law of delict that had imposed the equivalent
duty to the plaintiffs on the second defendants, is bad in law. Inasmuch as a valid
allegation that the second defendants owed a legal duty to the plaintiffs is fundamental
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to the Aquilian cause of action on which the plaintiffs seek to rely, the invalidity of
paragraph 84 is fatal to claim V(1). The first exception succeeds on the ground of the
criticism levelled at paragraph 84.
The reservation relating to claim II(1)(Part B)
[401] For reasons that I have set out above, I am prima facie of the opinion that the
plaintiffs' contractual claim II(1)(Part B) is bad in law. It is the claim in which the
plaintiffs have alleged 385 that GCC 35(2)(j) entitles them to 'any other losses'
amounting to a total of R24,084,989.23, including VAT. If my prima facie opinion that
GCC 35(2)(j) affords no such contractual right of action is correct, and if the plaintiffs
have no other contractual remedy for the recovery of these alleged losses, 386 the
question may arise whether this is an area unregulated by the tripartite relationship and
one that leaves room for a delictual remedy on the part of the plaintiffs against the
second defendants. The answer is not obvious, the more especially as one of the
questions raised in argument was whether the largest proportion of claim II(1)(Part B)
(namely the claim for legal costs, expert witnesses and consultants) was not
recoverable in these proceedings otherwise than as costs of litigation to be decided by
the court at the end of the case.
[402] However, notwithstanding my prima facie opinion, the fact is that no exception
was taken to claim II(1)(part B) and there has been no argument on its validity.
Therefore, for the purposes of the order to be made on this exception, I shall overlook
385 Particulars of claim, pp 60 to 61, para's 50.2 and 52.2, read with schedule X3 on p 89, Part B, Items 5, 6 and 7.
3a6 As I have already indicated, the plaintiffs' allegations suggest that they may have a contractual claim under the first defendant's indemnity to the plaintiffs in terms of GCC 36(2).
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my prima facie opinion and proceed on the assumption on which the matter was argued,
namely the assumption that claim II(1 )(part B), for items 5,6 and 7 in schedule X3, has
a foundation in the building contract. On that assumption, the first exception to claim
V(1) must be upheld in respect of all of the items set out in schedule X4, including items
5, 6 and 7.
Ad paragraph 85.1
[403] In their first exception, 387 the second defendants state:
'3. In paragraph 85.1, the Plaintiff alleges that the Second Defendant knew or ought
reasonably to have known that the Plaintiff would rely upon it to perform certain tasks set out in paragraphs 85.1.1 to 85.1.6 with reasonable skill, care and
diligence.
4. The plaintiff fails to allege however that it was entitled to rely upon the
Second Defendant to perform such tasks.
5. It is clear from the contractual documents relied upon by the Plaintiff that the
Second Defendant's obligation to perform the aforesaid tasks was one owed
not to the Plaintiff but to the First Defendant. 6. It is also clear from the contractual documentation expressly or implicitly
relied upon by the Plaintiff and described below that the Plaintiff was
precluded in the execution of its own contractual duties from relying upon
the performance by the Second Defendant of its obligations to the First
Defendant:
CSRA Standard Specifications for Road and Bridge Works, 1987
(hereinafter "CSRA") section 1221; 388
387 at p 685.
388 Pleadings, p 627: '1221 DRAWINGS PROVIDED BY THE CONTRACTOR
... Notwithstanding the approval and acceptance and signing of the drawings, the contractor shall take full responsibility for all details, discrepancies, omissions, errors, etc in respect of the said drawings as well as for the consequences thereof. ...'
In considering the contractual provisions referred to in the exception, it is relevant to have regard to those that relate to either of the two design faults for which the plaintiffs allege that the second defendants were responsible and on which the plaintiffs' causes of action in delict rest A number of the
(continued...)
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CSRA section 1205; 389
CSRA section 6203; 390
CSRA section 8104; 391
CSRA section 8308; 392
General Conditions of Contract clauses 6(1)(b) and 6(2); 393
388(...continued) contractual provisions that have been listed in the exception are merely provisions that render the plaintiffs responsible, to the exclusion of the second defendants, for various matters other than either of the two design faults on which the plaintiffs rely. I do not regard the provisions that are not applicable to either of the two alleged design faults as being relevant to the discussion.
The above-quoted CSRA 1221 is relevant because the plaintiffs allege that the law of delict has imposed on the second defendants a liability for drawings relating to the first design fault (the off-setting of the temporary bearings from the webs) on the ground that the second defendants had approved the plaintiffs' own faulty drawings. The question is whether the plaintiffs' undertaking to the first defendant in CSRA 1221 is a factor that tends to show that the parties' tripartite relationship was one that, by precluding the plaintiffs from looking to the first defendants for relief from errors made by the plaintiffs themselves in drawings (despite the second defendants' approval), left the plaintiffs without a remedy for the consequences of their own error, or whether the tripartite relationship left room for the law of delict to provide the plaintiffs with a remedy for their own error, by blaming the second defendants for having approved the plaintiffs' own faulty drawings. .
389 Pleadings, p 617: '1205 WORKMANSHIP AND QUALlTY CONTROL' I do not quote this provision as I am of the view that the plaintiffs' allegations to the effect that they built the
bridge in accordance with the drawings and specifications approved by the second defendants meets the main point that the second defendants seek to make of it
390 Pleadings, p 630: '6203 GENERAL' This provision places sole responsibility for 'falsework' and 'formwork' on the contractor. In terms of the definitions in the New Oxford Dictionary of English, 2002, 'falsework' consists of 'temporary framework structures used to support a building during its construction'; and 'formwork' is 'shuttering: planks to contain setting concrete, support earth on the side of a trench, or similar.'
It is not impossible that usage in the construction industry may include such temporary works as the launching nose and the temporary bearings in the concept of 'falsework' or 'formwork', but I would need evidence to prove it. I am not satisfied that this provision is relevant to either of the design faults on which the plaintiffs rely.
391 Pleadings, p 639: '8104: TAKING AND SUBMITTING SAMPLES'. I am not satisfied that this provision is relevant to either of the design faults on which the plaintiffs rely.
392 Pleadings, p 656: '8308: PROCESS CONTROL BY THE CONTRACTOR'. I am not satisfied that this provision is relevant to either of the design faults on which the plaintiffs rely.
393 Pleadings, p 183: '6 (1) The Contractor shall ... (b) provide all .. Temporary Works, including the design thereof ... (2) ... [This provision has not been shown to be relevant because there is no allegation that the plaintiffs, as the Contractor, were required to design any part of the Permanent Works].
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14(2) and (3); 394
2(4)(b); 395
15(5); 396
25(1); 397
29(1)(b); .398
35(1)(a) read with 35(1)(b), 35(1)(c) and 35(2)(j); 399
36(1); 400
52(8); 401
55(1) and (2) 402 and
394 Pleadings, p 187. I am not satisfied that this provision is relevant to either of the design faults onwhich the plaintiffs rely.
395 Pleadings, p 181. Not relevant to either of the design faults on which the plaintiffs rely.
396 Pleadings, p 188. Not relevant to either of the design faults on which the plaintiffs rely.
397 Pleadings, p 191. Not relevant to either of the design faults on which the plaintiffs rely.
398 Pleadings, p 193; Not relevant to either of the design faults on which the plaintiffs rely.
399 Pleadings, p 195. These provisions provide the plaintiffs with a contractual remedy againstthe first defendant in respect of the design faults that the plaintiffs have attributed to the second defendants. It is the remedy that they pursue in their claim II(1)(Part A). Again, the question is whether this provision tends to show that the nature of the tripartite relationship was one that confined the plaintiffs to their contractual remedies against the first defendant for design faults of the second defendants, or whether it left room for the plaintiffs to assert a right of action in delict against the second defendants for the consequences of such faults.
400 Pleadings, p 196. In terms of GCC 36(1), the plaintiffs indemnified the first defendant'against any liability in terms of damage to or physical loss of the property of any person or injury to or death of any person ... arising directly from the execution of the Works' with several exclusions,including notably 'injuries or damage to persons or property resulting from any act, omission orneglect of the Employer, his agents ... or from proper compliance with any instruction of the Engineer ...'. In terms of GCC 36(2), the first defendant indemnified the plaintiffs against all liability in respect ofthe matters excluded from the indemnity given by the plaintiffs' to the first defendant Plainly, certain of the consequences of faulty design by the second defendants fell within these arrangements. Damageto property and injury to persons resulting from the building of the bridge in accordance with a faultydesign by the second defendants was excluded from the plaintiffs' indemnity to the first defendant, andwas included in the first defendant's indemnity to the plaintiffs. The question is whether thesearrangements point to the conclusion that the nature of the tripartite relationship was such as toconfine the plaintiffs to a contractual remedy against the first defendant in terms of the indemnity, or whether it left room for the plaintiffs to assert a right of action in delict against the second defendants.
401 Pleadings, p 208. Not relevant to either of the design faults on which the plaintiffs rely.
402 Pleadings, pp 210 - 211 : 'Final Approval Certificate 55. (1) The Works shall not be considered as completed in all respects until a Final
Approval Certificate shall have been delivered by the Engineer ... (continued...)
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Project Specifications p. 1-4, para. 2.2.4.,403
In their second exception, the second defendants state:
'2, AD PARAGRAPH 85.1:
2.1 In this paragraph the plaintiff alleges that the second defendant knew or
ought reasonably to have known that the plaintiff would rely upon the
second defendant to perform certain tasks with "reasonable skill, care and
diligence" .
2.2 The plaintiff fails to plead however that it was entitled to rely upon the
second defendant to perform such tasks, whether skilfully or otherwise, or
the basis upon which the second defendant owed a duty to the plaintiff to
perform the said tasks.
2.3 In the premises the allegations contained in this paragraph are vague and
embarrassing.'
[404] With regard to the second exception, it seems to me that when the plaintiffs'
allegations are read in their full context, they may reasonably be understood to contain
implied allegations that answer the difficulties raised by the second defendants. The
402(.. .continued) (2) No certificate other than the Final Approval Certificate referred to in Sub-Clause (1) shall be deemed to constitute approval of the Works or shall be taken as an
admission of the due performance of the Contract or any part thereof ...' This provision is relevant to the first design fault that the plaintiffs have attributed to the seconddefendants, namely their approval of the plaintiffs' drawings showing the off-setting of the temporary bearings from the webs. In GCC 55(2) the plaintiffs agreed that such approval would not amount to an admission on behalf of the first defendant of the due performance of that part of the building contract by the plaintiffs. Again, the question is whether this provision shows that the tripartite relationship was one that bound the plaintiffs to accept, for all purposes, that the second defendants' approval of theirfaulty drawings was not final, or whether it left the plaintiffs free to assert a delictual claim against thesecond defendants holding them responsible for the consequences of their approval of the plaintiffs'own faulty drawings.
403 Pleadings, pp 412 - 413: '2.2.4 Bridge work
... The contractor shall accept full responsibility for the design of all temporary works required for the construction of the bridge, and shall submit full details
thereof to the engineer for his review and acceptance.' In this provision, the plaintiffs unequivocally accepted 'full responsibility' for the first design fault (off-setting the temporary bearings - a part of the temporary works - from below the webs of the deck segments). The plaintiffs allege that such off-setting resulted from the design of the launching nose by the second defendants. However, the launching nose, whoever may have designed it, was also a part of the temporary works for which the plaintiffs accepted full responsibility.
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implied allegations are that, having regard to all the circumstances alleged in those
parts of the particulars of claim that are relevant to claim V(1), the relationship between
the plaintiffs and the second defendants was such that the second defendants owed the
plaintiffs a duty, imposed by the law of delict, to perform their task of designing the
bottom slab and webs of the deck segments (a part of the permanent works in respect
of which the second design fault is alleged to have occurred), and also their task of
approving the plaintiffs' drawings for the positioning of the temporary bearings (a part
of the temporary works in respect of which the first design fault is alleged to have
occurred), with reasonable skill, care and diligence, and such as to entitle the plaintiffs
to rely on the second defendants to perform those duties in that way. The plaintiffs'
allegations must accordingly be read in that way for the purposes of the exceptions.
Therefore, I do not uphold the second exception in respect of paragraph 85.1.
[405] With regard to the first exception, so far as it is based on the criticism of
paragraph 85.1, an allegation that the plaintiffs were entitled in all the circumstances
alleged to rely upon the second defendants to perform the tasks set out in sub
paragraphs 85.1.1 to 85.1.6, and to do so with reasonable skill, care and diligence must
be understood to be implied. Sub-paragraph 85.1.3 contains a reference to 'the second
defendants' obligations'. These were defined in paragraph 63 404 to include a number
of obligations plainly derived from the consultancy agreement between the first and
second defendants. 405 However, I find, as indicated in my footnotes to the particular
404 Particulars of claim, p 65.
405 Paragraph 63.1 derives from clauses 11.3 and 11.4.4 of the consultancy agreement, at p 540. Paragraph 63.2 derives from clause 4.6.1 of the consultancy agreement, at p 534. Paragraph 63.3 derives from clause 11.4 of the consultancy agreement, at p 540. Paragraph 63.4 derives from clause 4.1 of the consultancy agreement, at p 534. Paragraph 63.5 derives from a combination of passages selected from clauses 4.7.1 and 11.4.5 of the consultancy agreement, at pp 535 and 541 respectively.
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contractual provisions referred to by the second defendants in their exception, that
several provisions that govern the question of responsibility for design were included in
the building contract. They are in particular, CSRA 1221 (notwithstanding the approval
of the plaintiffs' drawings for temporary works, the plaintiffs took full responsibility for all
errors and their consequences); GCC 6(1)(b) (the plaintiffs to provide designs for all
temporary works); GCC 35 (detailed provisions for the consequences of damage or
physical loss to the works or materials on site either as a result of the materialization of
an 'excepted risk' - including 'the design, specification or instruction of [the second
defendants]' - or as a result of any other kind of risk); GCC 36 (reciprocal indemnities
between the plaintiffs and the first defendant in respect of various matters including the
first defendant's indemnity to the plaintiffs in respect of consequences of design faults
on the part of the second defendants); GCC 55 (second defendants' approvals,
including approvals of plaintiffs' designs for temporary works, not final until the issue of
a Final Approval Certificate); and Project Specifications 2.2.4 (the plaintiffs' acceptance
of full responsibility for the design of all temporary work required for the construction of
the bridge).
[406] On behalf of the plaintiffs, Mr Klevansky pointed out, appropriately, that there
were other contractual provisions that had also to be taken into account. The plaintiffs
were themselves obliged to design the temporary works. 406 They had therefore to
prepare the drawings showing how the temporary bearings were to be located on the
abutments and piers. Because the second defendants' design for the launching nose
(another of the temporary works for the design of which the plaintiffs were responsible)
was such that the temporary bearings would have to be located in positions suitable to
400 GCC 6(1)(b), p 183.
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carry the launching nose, the plaintiffs made provision for the temporary bearings to be
located accordingly. This had the consequence that the temporary bearings were
designed to be in positions in which they would not provide support to the deck
segments immediately beneath the webs. They would be off-set from the webs,
somewhat towards the centre of the bottom slab, with the consequence that as each
deck segment passed over the temporary bearings, there would be a moment operating
between the temporary bearings and the web-soffit conjunctions on either side that
would not have been present if the temporary bearings had been located directly
underneath the webs. This is what I have already called 'the first design fault'.
[407] The plaintiffs were obliged to submit their drawings containing the first design
fault to the second defendants for written approval, and when such approval had been
given, the plaintiffs were prohibited from departing from it in any way, 'except with the
written consent of the [second defendants].' 407
[408] It is the plaintiffs' case that, in view of these additional contractual provisions,
they had an obligation to the first defendant to build the bridge in accordance with the
approved drawings containing the first design fault, and that by reason of legal duties
imposed by law as a result of the tripartite relationship, the second defendants' approval
of these drawings constituted a breach of a duty owed to the plaintiffs.
[409] The question to be considered is whether all of these contractual arrangements
under the building contract between the plaintiffs and the first defendant, taken with the
consultancy agreement between the first and second defendants, amounted to a
tripartite relationship similar to that in Lillicrap, leaving no room for the intrusion of the
law of delict into the parties' contractual arrangements relating to the matters
407 GCC 16(11). p 189.
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complained of by the plaintiffs; or whether the plaintiffs have justifiably invoked the law
of delict against the second defendants in respect of those matters.
[410] In my judgment, the answer is provided essentially by the reasoning in Lillicrap.
However, before coming to that, I wish to clear out of the way the plaintiffs' fallacious
proposition that they were obliged by the building contract to attempt to build a bridge
that was unbuildable because of the first design fault contained in a temporary works
drawing approved by the second defendants. For this purpose, I turn to the matter of
S M Goldstein v Cathkin Park Hotel (Pty) Ltd and Another ('Goldstein'). 408
[411 ] In Goldstein, a firebox, with an inflammable decoration just above it, was
installed in a building, in accordance with the architect's design. In that respect, the
architect's design had overlooked and departed from the safety directions of the
manufacturer of the firebox. When the building had been completed, a fire in the
firebox ignited the decorations, the fire spread, and the building was seriously damaged.
The building owner and also the lessee who operated a hotel business in the building,
sued a number of defendants, including the builder, in delict. The claims against all
defendants other than the builder were settled or withdrawn. At the trial, the builder was
held liable. He appealed. One of his contentions on appeal was that he was not liable
in delict because the building contract had obliged him to build in accordance with the
architect's directions and instructions and to his satisfaction. He could not deviate
unless he had first given the architect due notice.
[412] Harms JA, delivering the judgment of the court, held 409 that this defence was
based on an oversimplification. The contract had not obliged the builder to build in
408 2000 (4) SA 1019 (SCA).
409 at 1024H - 102G.
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accordance with the architect's directions without regard to safety. The contract also
required the standard of workmanship to be of the best. The builder had been
appointed on account of his expertise and he was responsible for all aspects of the
construction. It was therefore for the builder to recognize the danger in the architect's
design, to point it out and give notice that he wished to deviate, and to obtain a variation
order from the architect. Therefore the defence that the builder had raised was not
available against the building owner, with whom the builder had contracted, nor was it
available against the lessee with whom the builder had no contract.
[413] The present matter is analogous. The plaintiffs have alleged that the second
defendants owed them a legal duty to take care not to approve a temporary works
drawing prepared by the plaintiffs that would jeopardise the construction of the bridge.
By implication, the allegation is that this duty arose out of the tripartite relationship to
which the plaintiffs and the second defendants are both parties. The second
defendants have excepted to the claim based on this allegation on grounds arising from
the tripartite relationship from which the alleged duty is (by implication) alleged to spring.
The tripartite relationship is based, in part, on the building contract between the plaintiffs
and the first defendant. In terms of the building contract the plaintiffs expressly
accepted both full responsibility for the design and construction of the temporary works
required for the bridge, 410 and also 'Notwithstanding the approval... of the drawings...full responsibility for all details, discrepancies, omissions, errors, etc, in respect of the
said drawings as well as for the consequences thereof.' 411 Therefore, the second
defendants contend, there is no room for the plaintiffs' allegation that the second
410 Project specifications 2.2.4 at p 413.
411 CSRA 1221, at p 627.
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defendants had a legal obligation not to approve the temporary works drawings
prepared by the plaintiffs and containing the first design fault. The plaintiffs seek to
answer this proposition by pointing to the further contractual provision to the effect that
they were required to obtain the second defendants' approval of their temporary works
drawings and, having obtained it, were bound to build in accordance with it. 412
[414] I consider that the reasoning in Goldstein applies. The plaintiffs' proposition
is at least an oversimplification. The building contract did not oblige them to build in
accordance with a drawing, even once approved by the second defendants, where their
'full responsibility' for errors etc required them to know that adherence to the approved
temporary works drawing would jeopardize the bridge. It was for the plaintiffs to point
the first design fault out to the second defendants and to provide an amended set of
temporary works drawings. If the second defendants did not approve the amended
drawings and, if necessary, issue a variation order in terms of GCC 39, the plaintiffs
could and should have raised a disagreement in terms of GCC 60. They could and
should have followed the dispute procedure as far as necessary to avoid the futility of
attempting to build a structure in accordance with temporary works drawings for which
they were fully responsible irrespective of the second defendants' approval, and which
they were therefore required to know would cause a collapse during the launching of the
deck segments. Their proposition that once the second defendants had approved their
drawings incorporating the first design fault, they were obliged to attempt to build the
bridge in accordance with it, cannot be accepted.
[415] Having disposed of the fallacious proposition that the plaintiffs were obliged by
the building contract to build in accordance with the drawings containing the first design
412 GCC 16(11), on p 189.
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fault, I turn back to the question whether or not the reasoning in Lillicrap governs the
tripartite relationship in the present matter.
[416] First, the present case, like Lillicrap, relates to the professional conduct of
consulting engineers, a field into which legal authority had not previously recognized the
principles of Aquilian liability as extending. Therefore, the question was then, and must
still be, approached conservatively.
[417] Second, in Lillicrap, one of main considerations raised was whether there was
any need for the recognition of an Aquilian remedy in the circumstances of the case.
A reading of the parties' contractual arrangements revealed that there was no such
need. The parties had made the contractual arrangements that they considered
satisfactory. In my view, the same applies in the present matter. In terms of their
arrangements, the plaintiffs were to look to the first defendant for relief in respect of the
conduct of the second defendants so far as regulated by the building contract. The first
defendant was in turn to look to second defendants for any failure on their part to
perform the obligations they had undertaken in the consultancy agreement to perform
with due skill, care and diligence, but within the limits there set out. The building
contract does indeed make clear provision relating to responsibility for design faults of
the kind complained of by the plaintiffs.
[418] So far as concerns the first design fault complained of (the second defendants'
indications that the temporary bearings should be offset from the webs, and their
approval of the plaintiffs' drawings that were at fault in the respect that they followed the
second defendants' indications in this regard), the contractual arrangements show that
the plaintiffs accepted 'full responsibility' for the drawings for all temporary works,
whoever may have drawn them, and irrespective of the fact that the second defendants
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had approved them. Having regard to the tripartite relationship, there is no more room
than there was in Lillicrap for any assumption that the plaintiffs accepted this 'full
responsibility' on the understanding that the absence of privity of contract would leave
them free to sue the second defendants in delict, than there was in Lillicrap.
[419] As to the second design fault complained of (the second defendants' failure to
design the web-soffit conjunctions of the bottom slab of the deck segments with
sufficient reinforcing steel to give the concrete the strength needed to withstand the
forces to which it would be subjected in the course of the launching process) full
provision for the relief of the plaintiffs from the consequences was made in GCC 35.
[420] These contractual arrangements therefore leave no need for an Aquilian
remedy on the part of the plaintiffs in respect of either of the two design faults
complained of.
[421] Third, just as in Lillicrap, to recognize an Aquilian remedy as extending into this
tripartite relationship in respect of matters regulated by the contracts, would be to create
unnecessarily an anomalous situation relating to the standard of performance. For
example, the standard of performance required of the second defendants is defined in
a standard form of contract based on rules published in terms of the Engineering
Profession of South Africa Act (Act No 114 of 1990) and recommended for use by The
South African Association of Consulting Engineers. 413 The purpose of the consulting
engineer's site visits and responsibilities during the construction stage is defined in
paragraphs 4.7.1 and 4.7.2. In 4.7.1 the purpose is limited to providing the client - the
first defendant - with a greater degree of confidence that the completed work of the
contractor will conform generally to the contract documents etc. Paragraph 4.7.2
413 Particulars of claim, p 525.
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emphasizes that the consulting engineer's functions do not include detailed supervision,
and it sets out the limits of his authority over and responsibility for the work of the
contractor in a way that justifies the conclusion in paragraph 4.7.3 that
'the Consulting Engineer cannot ensure the performance of the Contractor
nor guarantee against any failure by the Contractor to perform his work in
accordance with the Contract or the Contract documents.' 414
Thus, the second defendants' undertaking to perform their tasks with reasonable skill,
care and diligence was qualified by the reservation that they did not provide any
guarantee that the plaintiffs would not make such an error as the first design fault. On
the other hand, the plaintiffs' reliance on the first design fault as involving a breach of
a legal duty owed by the second defendants to the plaintiffs, suggests that, if the
plaintiffs' allegations are justified, the law of delict will be found to impose a materially
more stringent standard. It is, after all, the plaintiffs' case that the reasonable man
would have discovered and pointed out the error made by the plaintiffs in the temporary
works drawings that provided for the off-setting of the temporary bearings from the
webs, and that it was second defendants' legal duty to do the same. In this respect,
and various others, the problem identified in Lillicrap of how to reconcile the contractual
standard of performance required by the consultancy agreement with the standard for
delictual liability looms large.
[422] Fourth, reverting to the first point relating to a conservative approach, I find no
circumstances in the case disclosed by the plaintiffs in claim V(1), read in its full context,
to justify the recognition of Aquilian liability on the part of a professional consulting
engineer, whose contract is part of a tripartite arrangement, in this case any more than
in Lillicrap.
414 Particulars of claim, p 535.
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[423] The plaintiffs' allegations in paragraph 85.1, with their implication that the
plaintiffs were entitled to rely on the second defendants to perform the alleged legal
duties with reasonable skill, care and diligence is fundamental to the cause of action
they have attempted to set out in claim V(1). However, for the reasons I have given,
they are allegations that are inconsistent with the implications of the tripartite
relationship to which they are parties. On the strength of the decision in Lillicrap,
therefore, the allegations in paragraph 85.1 are bad in law and must be struck out and
the second defendants' exception to claim V(1) must be upheld on that further ground.
Ad paragraph 85.2:
[424] In their first exception, the second defendants state: 415
8.
'7. In paragraph 85.2 of its Particulars of Claim the Plaintiff alleges that the
Second Defendant knew of foresaw or ought reasonably to have known or
foreseen that if it failed to perform properly the obligations pleaded by the
Plaintiff in paragraphs 84.1 and 85.1 of its Particulars of Claim the bridge
would be susceptible to failure during construction and that "the Plaintiff as
a consequence thereof, would be exposed to the risk of loss or damage
associated with such collapse and/or failure, notwithstanding the Plaintiff's
drawings of the temporary works were approved and that the Injaka Bridge
was built in accordance with the building contract and drawings as defined
in the GCC."
The Plaintiff fails however to plead the factual or legal basis upon which it
would be exposed to the risk of loss or damage associated with the
collapse or failure of the bridge.'
[425] In their second exception, the second defendants raise substantially the same
criticism and state that the plaintiffs' allegations in paragraph 85.2 are therefore vague
and embarrassing.
415 p 676.
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[426] Paragraph 85.2 is directed to alleging the basis, or a part of the basis, on which
the court is to be asked to find that the second defendants acted culpably. The
allegations relate to the foreseeability of the second defendants' alleged conduct
causing harm to the bridge and consequent patrimonial loss to the plaintiffs of the kind
detailed in schedule X4. The conduct in question is that relating to the two alleged
design faults on which the plaintiffs' case depends. The plaintiffs concede that their
claims in delict will abate to the extent that they may recover in terms of their contractual
remedies.
[427] I am unable to see that without further factual allegations the plaintiffs have
failed to allege a connection between the second defendants' conduct said to have
caused the collapse of the bridge and the patrimonial loss that the plaintiffs are said to
have sustained in consequence. Of course, if other grounds of exception are sound,
as I have found them to be, the allegation that damage to the bridge and loss to
plaintiffs was foreseeable is irrelevant. In my view, the criticism of paragraph 85.2 is not
well-founded in that it does not add anything to the force of the second defendants'
exception.
Ad paragraph 86:
[428] In their first exception, the second defendants state: 416
'9. The Plaintiff alleges in paragraph 86 that "A reasonable engineer in the
position of the Second Defendant would have taken reasonable steps to
ensure that" certain of the Second Defendant's and the Plaintiff's
obligations were properly performed. It is not alleged however that the
duty to take such steps was owed to the Plaintiff, nor could such allegation
be made having regard to the contractual documentation upon which the
Plaintiff relies.'
416 p 677.
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In their second exception, they make a similar allegation. 417 [429]
[430] In my judgment, the plaintiffs' allegations, read in their full context, can
reasonably be understood to convey the implied allegation that, having regard to all the
circumstances alleged, including the fact that the claim is in delict, the second
defendants owed the duty to the plaintiffs, and the particulars of claim must accordingly
be read in that way.
[431] Again, that is not the end of the matter. The next question is whether, having
regard to the provisions of the building contract, and in particular those provisions that
I have already referred to in dealing with paragraph 85.1 of the particulars of claim, the
allegation is sound in law. For reasons similar to those I have already given, I consider
that it is not sound in law. As is the position in respect of paragraphs 84 and 85, the
inconsistency of paragraph 86 with the building contract, and with the consequences of
the tripartite relationship that have already been discussed in the context of Lillicrap,
provides another reason why the second defendants' exception must, in my view, be
upheld.
Ad paragraph 87:
[432] In their first exception, the second defendants state: 418
'10. In paragraph 87 of its Particulars of Claim the Plaintiff alleges that "in the
premises" the Second Defendant owed it a duty of care to ensure that the
Second Defendant discharged its obligations and those contemplated in
paragraphs 84.1 and/or 85.1 of the Particulars of Claim with reasonable
skill, care and diligence and to ensure that the Injaka Bridge was not
susceptible to collapse and/or failure, during construction.
417 p 695.
418 p 677.
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11. The facts and circumstances alleged by the Plaintiff in the preceding
paragraphs do not however establish a basis for the allegation of the
existence of such a duty of care. Alternatively, and in any event, the facts
alleged by the Plaintiff do not give rise to any claim for damages in respect
of mere pecuniary or financial loss, as claimed by the Plaintiff.'
[433] In their second exception, the second defendants repeat this criticism in
support of the submission that the particulars of claim are vague and embarrassing in
this respect. 419
[434] For the reasons given in relation to paragraph 84. by means of which the
plaintiffs aimed to aver facts showing that the second defendants owed them certain
legal duties, the plaintiffs failed to make a valid averment to that effect. For the reasons
given in relation to paragraphs 85 and 86, by means of which the plaintiffs aimed to aver
facts showing that the second defendants owed them a legal duty to perform the first
mentioned duties with care, the plaintiffs also failed to make valid averments to that
effect. Therefore, I hold that the second defendants' criticism that the plaintiffs'
allegation, in paragraph 87, of a conclusion that the second defendants owed the
plaintiffs a legal duty of care, lacks valid premises and is consequently a non sequitur
and not a valid conclusion.
[435] As to the second defendants' further criticism that the plaintiffs' allegations 'do
not give rise to any claim for damages in respect of mere pecuniary or financial loss, . as
claimed by the Plaintiff, I hold, for reasons given above, first, that the plaintiffs'
allegations do not give rise to any claim for patrimonial loss; and second, that the
question whether the loss for which they wish to claim is or is not pure economic loss
is irrelevant to the question for decision. The question of a need to control the danger
419 pp 695 - 696.
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of opening the door to 'indeterminate liability' has not arisen. Unless it arises, it seems
to me that the decision in Administrateur, Natal v Trust Bank has rendered irrelevant the
characterization of the plaintiffs' loss as 'purely economic'.
Ad paragraphs 88 and 89:
[436] In their first exception, 420 and again in their second exception, 421 the second
defendants state in effect, correctly in my view, that where the plaintiffs have failed, as
they have, to make valid allegations of a duty owed to them by the second defendants,
their allegation of a breach of duty takes their case no further.
Ad causation of loss:
[437] In their first exception, 422 and again in their second exception, 423 the second
defendants state that the plaintiffs have failed to make averments to show that the
second defendants' alleged breach of duty caused the loss that the plaintiffs claim to
have sustained.
[438] In my view, it is clear enough that the chain of causation relied upon by the
plaintiffs is that the conduct of the second defendants in relation to the first and second
design faults caused the collapse of the bridge, and that but for the collapse of the .
bridge, they (the plaintiffs) would not have sustained any of the losses that they claim
to have sustained under the various heads detailed in schedule X4. So far as factual
causation is concerned, it seems to me that it has been sufficiently averred. Legal
420 p 678, paragraphs 12 and 13.
421 p 696, paragraph 6.
422 p 678, paragraph 14.
423 pp 696 to 697, paragraph 7.
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causation is another matter. There is no need for the plaintiffs to make further
averments in that regard.
[439] As indicated above, Mr Loxton submitted on behalf of the second defendants
that because the plaintiffs had contractual claims against the first defendant for the full
amount claimed from the second defendants in delict, the plaintiffs' patrimony had not
been reduced by the alleged conduct of the second defendants.
[440] For the reasons already given above, I hold that
1. The value of each of the plaintiffs' claims in contract against the first defendant
is indeed liable to be set off against the equivalent claim against the second
defendants in delict, because the plaintiffs' patrimony has not been reduced by
the value of the contractual claim, whatever that value may turn out to be. 2. The value of each claim in contract is not necessarily the same as the amount
claimed. Despite the fact that, for purposes of the exceptions, the plaintiffs'
allegations, to the extent the they are not bad in law, are taken to be correct,
the court cannot ignore the fact that these are opposed proceedings. It would
be unrealistic to pretend that each contractual claim is worth the amount
claimed. At this stage, the value is an uncertain amount that will only become
certain when the matter is disposed of by a final judgment or in some other
way. The plaintiffs concede that their claims in delict must be reduced by any
amounts recovered in terms of their contractual claims.
3. Therefore the second defendants' exception cannot be upheld on the ground
that the plaintiff has not made any valid allegation of a patrimonial loss caused
by the conduct of the second defendants.
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Exception to claim V(1) upheld
[441] On the grounds set out above, I uphold the second defendants' exception to
claim V(1) as lacking averments necessary to sustain a cause of action.
The second defendants' exception to claim V(2): Misstatement:
[442] In the alternative to claim V(1), based on allegations relating to acts of the
second defendants alleged to have been wrongful and negligent, the plaintiffs have
formulated a claim for the same patrimonial loss, attributed to an alleged misstatement
by the second defendants, similarly alleged to have been wrongful and negligent. I
have called it claim V(2). It is also the subject of an exception by the second
defendants.
[443] I summarize the contents of each of paragraphs 91 to 95, constituting claim
V(2): 424
91 91.1 The second defendants are alleged to have approved the plaintiffs'
drawings relating to temporary works specified in the appendix to the
second defendants' letter dated 13 May 1998. 425 The letter was
addressed by Mr D W Burger of the second defendants to Mr N Serman
of the plaintiffs. The body of the letter stated:
'This is to confirm that your temporary works drawings as listed in the appendix to this letter are approved as compatible with the design.'
91.2 The plaintiffs' drawings
'were not compatible with the design of the permanent works for the
reasons set out mutatis mutandis in paragraph 49 above.'
424 Particulars of claim pp 79 to 81.
425 pp 573 to 580.
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Note: This appears to mean simply that the plaintiffs' drawings
incorporated the first design fault (the off-setting of the temporary bearings
from the line along which the webs would travel during launching).
92 The second defendants' approvals constituted a representation that
92.1 was false; and
92.2 was the wrongful breach of a legal duty not to make a misstatement; and
92.3 was negligent for want of the exercise of reasonable skill, care or diligence
in approving the drawings; and
92.4 was relied upon by the plaintiffs, and caused the plaintiffs to suffer loss in
that:
92.4.1 The second defendants' design of the permanent works, or the
plaintiffs' design of the temporary works as approved by the second
defendants, or the interface between them, or two or all three of these
factors, rendered the bridge unbuildable and susceptible to collapse
for the reasons set out in paragraph 49, mutatis mutandis.
(Note: This appears to mean that the first design fault, alone or in
combination with the second design fault, resulted in the collapse.
The alleged misstatement is concemed with the plaintiffs' drawings,
and these related to the first design fault and not the second. If the
collapse should prove to have been caused by the second design fault
alone, the alleged misstatement will be seen to be irrelevant.)
92.4.2 The plaintiffs proceeded to build the bridge in accordance with the
building contract and it collapsed in consequence of the second
defendants' misstatement that the plaintiffs' drawings incorporating
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the first design fault were compatible with the design for the
permanent works.
93 The misstatement caused the plaintiffs to sustain the losses set out in schedule X4.
94 Therefore the second defendants are liable to the plaintiffs for such losses.
95 VAT is also payable.
The first defendant's exception to claim III(2)
[444] It is convenient at this stage to interpose a reference to claim III(2) and the first
defendant's exception to it. Claim III(2), against the first defendant, is in identical terms
to claim V(2) against the second defendants, save only for the additional allegations in
claim III(2) directed to establishing the vicarious liability of the first defendant for the
allegedly wrongful and negligent misstatement of the second defendants.
[445] In support of the first defendant's exception to claim III(2), Mr Raath advanced
a contention that is equally applicable to the second defendants' exception to claim
V(2). It was based on the observations of Grosskopff AJA in Lillicrap, at 503 F-I, from
which I quote selected phrases:
'I should state ... that in my view no useful purpose would be served by
considering whether the claim in the present case should be categorised as one
based upon negligent misstatement. ... misstatements do not differ, in principle,
from other forms of allegedly wrongful conduct. I have not in fact found it helpful in
the present case to determine to what extent the appellant's conduct which is
alleged to be wrongful should be regarded as misstatements, as distinct from
other forms of conduct.'
Mr Raath submitted that the plaintiffs' alternative characterization of their claims in delict
as claims for damages for negligent misstatement did not take their case any further
than the main claims based simply on allegations of wrongful conduct. In my judgment,
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that submission was correct for the following reasons.
[446] In respect of both claim III(1) and claim V(1), the plaintiffs rely on the first
design fault (relating to the off-setting of the temporary bearings from the line along
which the webs would travel when the deck-segments were to pass over the temporary
bearings during the launching process). In those two claims, they also rely on the
second design fault (relating to the under-strength steel reinforcing in the concrete of
the bottom slabs of the deck segments at the web-soffit conjunctions). However, in both
claims III(2) and V(2), based on misstatement, the plaintiffs rely on an alleged
misstatement relating only to the first design fault.
[447] In claims III(1) and V(1), the essence of the plaintiffs' case relating to the first
design fault is contained in the repetition of paragraph 49 in claim II(1), and its
incorporation in claims III(1) and V(1) by reference. 426
[448] In each case the substance of the underlying factual averments, gathered from
paragraph 49 and elsewhere in the pleadings and annexes, may be paraphrased as
follows:
1 . The second defendants gave the plaintiffs certain contractual documents and
drawings that they had prepared. Those relevant to the first design fault
related to the steel launching nose. These documents and drawings reflected
dimensions of the launching nose that in turn suggested the distance apart that
the temporary bearings would have to be located on the abutments and piers
in order to support the horizontal steel girders of the launching nose as it was
propelled outwards over the spans between the piers in the launching process.
2. The plaintiffs assumed (wrongly as it later emerged) that if the temporary
426 The incorporation by reference is effected in claim III(1) by para 66.3 on p 66; and in claim V(1) by para 88 on p 77.
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bearings were located appropriately to carry the steel girders of the launching
nose, they would also be located appropriately to support the deck segments
of reinforced concrete that were to follow in train behind the nose in the
launching process. This assumption was wrong because the concrete deck
segments needed support from the temporary bearings immediately below the
webs on either side, a fact that required the temporary bearings to be
positioned a greater distance apart from each other than was necessary for the
support of the launching nose. The consequence of positioning the bearings
according to the dimensions of the launching nose was that when the nose
travelled over them, it was appropriately supported, but that when the concrete
deck segments followed over the same bearings, the bearings were too close
together to provide support where it was needed beneath the webs of the deck
segments.
3. In this way, the plaintiffs came to prepare drawings for the temporary works
that provided for the temporary bearings to be located in positions in which
they would wrongly be off-set from the webs when support from directly below
the webs was required. Thus, the plaintiffs say, they were led by the second
defendants to introduce the first design fault into the drawings.
4. As required by the building contract, the plaintiffs submitted their drawings to
the second defendants for approval, and the second defendants approved
them 'as compatible with the design'.
5. The plaintiffs allege that the second defendants knew that they would rely on
this approval as conveying that the bridge could successfully be built in
accordance with the drawings approved as compatible. They imply that, in the
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circumstances, they were entitled to rely on the second defendants' approvals.
6. The plaintiffs allege that the consequence of their reliance on the second
defendants' approval of the drawings containing the first design fault was that
this design fault became one of the causes of the collapse of the bridge during
the course of construction, and that the second defendants' approval was
therefore also one of the causes of the collapse.
7. After the collapse of the partly built bridge, the plaintiffs allege, the second
defendants rectified the two design faults that had caused the collapse. They
rectified the second design fault by redesigning the deck segments to contain
more reinforcing steel in the bottom slabs and particularly strengthening the
web-soffit conjunction where the failure had started. They also rectified the
first design fault by relocating the temporary bearings so that they would
provide support immediately below the webs of the deck segments. This
implies that they also redesigned the launching nose (which was itself a part
of the temporary works) so that it, too, could be supported by the temporary
bearings when they had been positioned appropriately to support the deck
segments.
8. The plaintiffs allege further that by approving the drawings containing the first
design fault as compatible with the design, the second defendants breached
a duty imposed on them by law, to act with due care before approving the
drawings as compatible.
9. The plaintiffs imply that the second defendants owed this legal duty to
themselves, the plaintiffs, and they allege that in breaching it the defendants
therefore acted wrongfully and that they also acted negligently for want of due
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care.
[449] In claims III(2) and V(2), the plaintiffs also rely on an incorporation by reference
of the allegations made in paragraph 49 of claim II(1). 427
[450] The question that arises is whether any allegation of substance has been
added in claims III(2) and V(2) that is not already in claims III(1) and V(1) respectively.
In my view, all that has been added in claims III(2) and V(2) are allegations to the effect
that the second defendants' approval of the plaintiffs' drawings of temporary works as
compatible with the design constituted a misstatement and that the second defendants
were under a legal duty to the plaintiffs to refrain from making such a misstatement.
The question is therefore whether the allegation that the second defendants wrongfully
and negligently approved the plaintiffs' drawings and so caused the damages
complained of by the plaintiffs (claims III(1) and V(1)) is in any material way different
from the allegation that the second defendants wrongfully and negligently made a
misstatement by approving the plaintiffs' drawings and so causing the damages
complained of by the plaintiffs (claims III(2) and V(2)). In my view it is clear that, as in
Lillicrap, this is not a case in which there is any meaningful difference between the act
of wrongly approving a drawing that should not have been approved and a statement
of approval of a drawing that should not have been stated to have been approved. The
act and the statement have been alleged to have produced precisely the same
consequences in precisely the same way.
427 Paragraph 49 is incorporated by reference into claim III(2) in paragraphs 68 (p 67) and 69.4.1 (p 68); and it is also incorporated by reference into claim V(2) in paragraphs 91.2 (p 79) and 92.4.1 (p 80) .
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Exceptions to claims III(1). III(2) and V(2) upheld
[451] The exceptions of both the first and the second defendants to claims III(2) and
V(2) respectively also follow the same lines as their respective exceptions to claims
III(1) and V(1) respectively. Therefore, for the reasons that I have already given in
respect of the exception taken by the second defendants to claim V(1), I uphold the
exceptions of both the first and second defendants that claims V(2) and III(1) and III(2)
lack averments necessary to disclose a cause of action.
The alleged vicarious liability of the first defendant
[452] In the light this conclusion, it may not be necessary to deal with the further
question of the alleged vicarious liability of the first defendant for the alleged delicts of
the second defendants in terms of the averments in claims III(1) and (2). Nevertheless,
that question was argued, and in case it should turn out to be necessary at a later stage,
I shall deal with it.
[453] In order to reach the question of vicarious liability at all, it is necessary to
assume, contrary to my findings, that the second defendants owed the plaintiffs the
legal duties alleged by the latter, and that they breached such duties through lack of due
care, thereby acting both wrongfully and negligently. To put it in concrete terms, I must
assume that, despite the tripartite relationship created by the consultancy agreement
and the building contract, the second defendants owed the plaintiffs a legal duty to act
with care, and that in respect of each of the two design faults they breached that legal
duty. I must further assume that if the second defendants had duly performed their duty -
1. their design of the deck segments would not have left the bottom slabs with
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inadequate steel reinforcing to afford sufficient strength to enable the web-soffrt
conjunctions in deck-segment 2 to withstand the forces to which they would be
subjected when, during launching, that segment was passing over the
temporary bearings on pier 2 i.e. the second defendants would not have
introduced the second design fault; and
2. the second defendants would not have approved the plaintiffs' drawings for the
positioning of the temporary bearings as 'compatible with the design' but would
have drawn the plaintiffs' attention to the fact that the temporary bearings
should be located in positions in which they would afford support to the deck
segments directly below the webs on either side, i.e. the second defendants
would not have approved the first design fault.
3. I must also assume that the second defendants' breach of these alleged legal
duties caused the plaintiffs to sustain the patrimonial losses that they have
alleged, or at least some part of those losses.
[454] On the basis of these assumptions, I turn to the question of vicarious liability.
In recent years, the courts' approach to questions of vicarious liability has undergone
considerable development and change. There has been some retreat from the earlier
approach of defining, or trying to define, reasonably clear-cut rules that impose vicarious
liability on one person for the delictual conduct of another, and a growing awareness
that there are no clear principles that make such definition feasible. Counsel referred
to the summary of the current approach in LAWSA, 428 from which I quote selected
passages, omitting all but two of the footnotes:
'29 Vicarious liability Vicarious liability exists where one is liable, not for a
428 LAWSA. vol 8, part 1 (2nd ed, 2005), par 29.
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delict committed by oneself, but for a delict committed by another person. It is strict
liability, or liability without fault, on the part of the defendant and is additional to that
of the other person. The decision to treat a class of cases differently and to impose
vicarious liability is based on social policy regarding what is fair and reasonable and
amounts to an expression of a society's legal convictions that victims of delictual
conduct should be able to recover damages from someone who has the ability to
pay. Factors that play a role include the interests being served, control over
another's activity, the creation of risk, who benefits from the activity, and who can
afford to pay.
It is usual to approach the question of vicarious liability first by inquiring whether
a relationship exists between the person who commits the delict and the person
purportedly liable, and secondly, by establishing a link between the delict and either
the latter's instruction or his or her work. In other words, liability is based upon a
relationship which is capable of founding liability and an activity which can be linked
to the person who is sought to be held liable.
The purpose of the first leg of the inquiry is to establish whether or not the
delictual conduct occurred while the person performing the task was acting on behalf
of another, or independently. ...
Vicarious liability is not limited to employment relationships. ...
So, in the same way as control is not essential for establishing an
employment relationship, the ability to exercise actual or de facto control is no longer
a necessary requirement for establishing liability in other categories.
Courts have thus far considered three broad categories of relationships to be
sufficiently analogous to satisfy the creation of the necessary link: employment;
mandate; 429 and that between an owner and driver of a motor vehicle. This list is not
closed, however ...
The second leg of the inquiry is to establish whether or not the delict was
committed during the course and scope of employment or in executing another's
instruction, or while undertaking an activity which serves the other party's
interests. ...
Mandators are vicariously liable for mandataries' delicts committed in
429 Footnote 14: 'The relationship is traditionally referred to as that of principal and agent The granting of authority does not form the basis of the relationship, however: see Midgley 1991 SALJ 419.'
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executing their instructions; 430 principals for agents' delicts committed within the scope of their authority and while exercising that authority; and
partners for the delicts of a partner committed while acting in the course and
scope of the partnership business.'
[455] In the present case, the plaintiffs have alleged a relationship between the first
and second defendants that was based on the consultancy agreement. It was a
contract for the letting and hiring of a particular job of work, and not for the letting and
hiring of services generally. The relationship was at the same time one of mandate.
It was not the relationship of employer and employee (formerly master and servant) in
which the employer has the right of control over the manner in which the employee
performs his duties. It is necessary to give some consideration to the circumstances
in which a mandator may be held vicariously liable for a delict committed by his
mandatary.
[456] There does not appear to be any rule of law to the effect that a mandator is
always, or is never, vicariously liable for the delicts of his mandatary. In Eksteen v Van
Schalkwyk 1991 2 SA 39 (T), Van Zyl J showed convincingly that there was no reason
to believe that a mandator had ever been held vicariously liable for the delicts of his
mandatary in either Roman or Roman-Dutch law. The learned judge also held that
modern South African law had gone no further than to recognize that a mandator was
vicariously liable if his mandatary was an employee going about his employer's (the
mandator's) business. Where the mandatary was not an employee, but someone in a
category previously referred to, often inaccurately, as an 'independent contractor', there
was no room for vicarious liability, and the mandator would be liable only for his own
wrongful and negligent conduct. For example, where a mandator set his mandatary a
430 Footnote 41: 'But cf Eksteen v Van Schalkwyk 1991 2 SA 39 (T).'
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task involving danger to others and failed, wrongfully and negligently, to take the
necessary safety precautions himself, or to ensure that they were taken for him, he, the
mandator would be liable for his own wrongful conduct The mandator would similarly
be liable for his own conduct if he wrongfully and negligently appointed a mandatary to
a task beyond the latter's competence. Such cases are not instances of vicarious
liability, but of the mandator's liability for his own wrongful conduct
[457] Van Zyl J therefore declined to hold an attorney's client vicariously liable for a
wrongful act committed by the attorney in the course of writing a duly authorized letter
on behalf of his client. Without his client's authority, the attorney had added and
published certain defamatory remarks. The learned judge was of the view that our law
does not attribute vicarious liability to a mandator when the mandatary is not an
employee of the mandator, and he declined relief to the party complaining of
defamation.
[458] In an article headed 'Mandate, Agency and Vicarious Liability: Conflicting
Principles', 431 J R Midgley pointed out that the attention of Van Zyl J had not been
drawn to Barclays National Bank Ltd v Traub; Barclays National Bank Ltd v Kalk 432 in which a mandator had indeed been held liable for the wrongful act of a candidate
attorney who had not been an employee of the mandator.
[459] In my respectful opinion, the better view is that the present state of our law is
that it does not recognize a hard and fast rule to the effect that a mandator is, or is not,
vicariously liable for the wrongful acts of his mandatary when about the business of the
mandator. Any such vicarious liability will depend upon the facts of the case and the
431 1991 SALJ (vol 108) 419, at 423.
4321981 (4) SA 291 (W).
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application of legal policy, or the court's view about the legal convictions of the
community, in respect of those facts.
[460] In the present case, it is necessary to look to the plaintiffs' allegations in their
particulars of Claim to see what factors relevant to legal policy have been put forward.
I use the categories of factors distilled from the case law in the above-quoted passage
in LAWSA (Delicts):
1. The interests being served: The first defendant, as mandator, gave a
mandate to the second defendants in terms of the consultancy agreement, to
design and administer the construction of a bridge that would form part of a
public road. There is nothing to suggest that the first defendant, representing
the government, was engaged in any profit-making business interest of the
government. The bridge was to be constructed for the benefit of the public.
The terms of the consultancy agreement and the building contract make it clear
that the professional expertise of qualified civil engineers was required for the
task.
2. Control: Although the first defendant could terminate the mandate of the
second defendants in certain circumstances, there is nothing to suggest that
the first defendant was in a position to exercise any meaningful control over the
way in which the second defendants employed their professional expertise to
design and administer the construction of the bridge, or to make the necessary
complex calculations or solve any of the engineering problems inherent in the
task. As is usually the case when a professional expert in any field is
consulted and engaged, it can be accepted, in the absence of any suggestion
to the contrary, that the first defendant, far from being able to exercise any
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control over the second defendants' performance of their task, engaged the
second defendants for the benefit of their expertise and their capacity, and
precisely because the first defendant lacked the qualifications or capacity to
control the design and administer the construction of the bridge. The second
defendants were to undertake the task for the first defendant independently of
any control by him.
3. Creation of risk: The allegation that the partly constructed bridge collapsed
shows that a risk had indeed been created. In a sense, the first defendant, by
deciding to build the bridge, created the risk. However, there is nothing in the
particulars of claim to suggest that the task of building such a bridge by the
incremental launching method is a particularly new, untried or risky undertaking
in which previously unknown dangers might well be encountered. On the face
of it, the incorporation in the building contract of the 'Standard Specifications
for Road and Bridge Works' of the Committee of State Road Authorities
suggests that the task, although requiring a high degree of expertise, was of
a fairly routine nature for persons expertly qualified to undertake it.
The building contract indicates that the second defendants were
responsible for the design of the permanent works and the plaintiffs for the
design of the the temporary works. The plaintiffs have alleged that the collapse
was occasioned either by the first design fault (a fault in the temporary works,
for the design of which they themselves had undertaken full responsibility,
although they allege that the second defendants attracted liability for it by
approving the first design fault), or by the second design fault (a fault in the
permanent works, for the design of which the second defendants were
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responsible), or by the 'interface' between the two (which seems to mean by
a combination of the first and second design faults).
The plaintiffs' allegations therefore indicate that the first defendant's
contribution to the creation of the risk was relatively remote and minimal, and
that the immediate cause of the risk was the failure of the plaintiffs to discharge
their responsibilities in respect of the design of the temporary works, or the
failure of the second defendants to discharge their responsibilities in respect
of the design of the permanent works, or a combination of both such failures.
4. Who benefits from the activity? The main beneficiaries would ultimately be
the general public, whose satisfaction would also be a benefit to the
government, represented by the first defendant. The opportunity for
employment, and to make a profit, would also be of benefit to the plaintiffs and
the second defendants.
5. Who can afford to pay? There is no suggestion that any of the three parties
is unable to afford to shoulder the burden of the loss, extremely heavy though
it is alleged to be. The fact that the plaintiffs and the second defendants are
both companies in the private sector whose resources cannot be inexhaustible,
whereas the taxpayers who stand behind the first defendant are sometimes
regarded as an inexhaustible source of revenue, does not strike me as a
relevant factor to place in the scales.
6. Fairness and reasonableness: Weighing up the factors mentioned above,
it seems to me that, so far as appears from the plaintiffs' allegations, the factor
most important to the question whether legal policy, or the convictions of the
community, require the recognition of vicarious liability in this matter, is that of
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control. The indications are that the first defendant engaged the second
defendants for their expertise, the exercise of which the first defendant was in
no position to control. This factor, and the indications that the first defendant's
share in the creation of the risk was minimal and remote by comparison with
that of the plaintiffs and the second defendants, and that the first defendant
had nothing to gain from the enterprise other than the satisfaction of a public
need, taken together, all point to the conclusion that it would be unfair and
unreasonable to recognize vicarious liability in the circumstances alleged by
the plaintiffs. The interests being served, and the benefit to the first defendant
are more or less neutral factors. Putting these last two factors at their
strongest, they cannot be said to outweigh the factors that justify the
conclusion that the first defendant cannot fairly and reasonably be held
vicariously liable for the alleged wrongful and negligent conduct of the second
defendants.
[461] For these reasons, on the assumption that, contrary to my findings, the
plaintiffs have made allegations sufficient to disclose a cause of action in delict against
the second defendants, I hold that the first defendant's exception to the effect that the
particulars of claim III(1) and (2) lack averments necessary to establish vicarious liability
on the part of the first defendant, succeeds.
Absence of grounds for the plaintiffs to enjoy concurrent claims in contract and delict
against the first defendant
[462] I have referred above to the distinction between overlapping claims (sometimes
called concurrent claims in a broad sense) and claims more precisely referred to as
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concurrent claims. In my view it is clear that the plaintiffs' delictual claims against the
first defendant, claims III(1) and (2), are not claims that overlap their contractual claims
I, II(1)(PartA) and ll(1)(Part B) against the first defendant. On the contrary, claims III(1)
and (2) constitute an attempt by the plaintiffs to assert claims in delict that are strictly
and precisely concurrent with their contractual claims. To the extent that this court is
concerned with the question of policy whether such a concurrence of claims should be
allowed in this instance, I am of the opinion that the relevant questions of policy have
been raised and considered in the context of Lillicrap and the application of its principles
to the present matter. In my judgment, the same considerations lead to the conclusion
that the plaintiffs' allegations do not disclose any grounds of legal policy that would
justify the recognition of claims in delict as outlined in claims III(1) and (2) concurrently
with the contractual claims for precisely the same relief against the first defendant.
The second defendants' application in terms of Rule 30 to strike out
[463] Inasmuch as the second defendants' exceptions have succeeded, it is
unnecessary to make orders in respect of their application to strike certain matter out
of the particulars of claim as constituting irregular proceedings.
Summary
[464] To sum up, I uphold the second defendants' exception that claim V(1) lacks
averments necessary to sustain a cause of action on Aquilian principles on the following
grounds:
1. In claim V(1) the plaintiffs have set out to gain legal recognition for the
application of a remedy based on Aquilian principles to a set of facts to which
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previous legal authority has not recognized the remedy as applicable.
2. Therefore, the plaintiffs were required to aver facts that would justify the
conclusions of law that the alleged wrongdoers, the second defendants:
(1) had owed the plaintiffs a legal duty to conduct themselves in a particular way;
(2) had breached that duty and had accordingly acted wrongfully;
(3) in breaching the duty had also been at fault in that they had acted with
intent (dolo) or with negligence (culpa); and
(4) had thereby caused the plaintiffs to sustain patrimonial loss.
3. The plaintiffs have alleged that the second defendants owed them legal duties
(1) to refrain from approving the plaintiffs' drawings that incorporated the first
design fault mentioned above (namely, the off-setting of the temporary
bearings from the positions they should have had in order to give support
immediately below the webs of the deck segments);
(2) to design the permanent works without the second design fault mentioned
above (namely, to provide from the outset for the strengthening of the
bottom slabs of the deck segments, including the web-soffit conjunction on
either side, with the same quantity of reinforcing steel as was provided for
in the redesign after the collapse of the partly constructed bridge on 6th
July 1998);
(3) to co-ordinate the temporary works and the permanent works (referred to
as the 'interface' between the two) by ensuring that the temporary bearings
were located where they would provide support that would not result in the
failure of the deck segments during the launching process, or by ensuring
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that the deck segments were sufficiently robustly designed to withstand the
forces to which they would be subjected during the launching process
when passing over the temporary bearings located as approved by the
second defendants, or by both such expedients; and
(4) to refrain from making the misstatement that the plaintiffs' drawings
incorporating the first design fault were compatible with the design for the
permanent works, when they were not compatible.
4. The plaintiffs' allegation of the legal duty in 3(1) above is bad in law because
(1) the plaintiffs were parties to a tripartite relationship similar to that in
Lillicrap, Wassenaar and Partners v Pilkington Brothers (SA) (Pty) Ltd
1985 (1) SA 475 (A) as the latter relationship was after the assignment to
Salancs of the contractual rights and obligations initially enjoyed by
Pilkingtons against Lillicraps;
(2) in terms of the building contract between the plaintiffs and the first
defendant in the present matter,
(a) the plaintiffs had expressly accepted responsibility for the design of
the temporary works irrespective of the approval of the second
defendants; and
(b) in any event, the plaintiffs had contractual remedies against the first
defendant in respect of all the damages claimed from the second
defendants in claim V(1);
(3) in terms of the consultancy agreement between the first defendant and the
second defendants, the first defendant had such remedies against the
second defendants in respect of the plaintiffs rights of action against the
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first defendant as the first defendant and the second defendants had seen
fit to agree upon;
(4) the tripartite relationship left no room, in law, for the extra-contractual legal
duties alleged in 3(1) or (2) or (3) or (4) above;
(5) the plaintiffs failed to allege facts, or make submissions of law, to justify
the recognition of any need for an additional remedy based on Aquilian
principles;
(6) the plaintiffs failed to allege facts, or make submissions of law, to
demonstrate that the standards of performance stipulated for in the
consultancy agreement and the building contract could be reconciled with
the standard of performance that would be applicable in terms of Aquilian
principles.
5. The plaintiffs' allegation of the legal duty in 3(2) above is bad in law for the
same reasons as I have set out in paragraphs 4(1) to (6) above, with the
exception of 4(2)(a) which is not applicable to the second defendants' design
for the permanent works.
6. The plaintiffs' allegation of the legal duty in 3(3) above is bad in law for the
same reasons as I have set out in paragraphs 4(1) to (6) above.
7. The plaintiffs' allegation of the legal duty in 3(4) above is bad in law
(1) for the same reasons as I have set out in paragraphs 4(1) to (6) above;
and
(2) for the additional reason that the allegation that the communication to the
plaintiffs of the second defendants' approval of the plaintiffs' drawings as
compatible with the design for the permanent works constituted a
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misstatement, adds nothing material to the plaintiffs' case that the second
defendants' approval of the drawings was a wrongful act.
8. The plaintiffs have accordingly failed to make factual averments that, if proved,
would establish the existence of the legal duties that the plaintiffs contend that
the second defendants owed to them. The plaintiffs have therefore also failed
to make valid allegations of a wrongful breach of any such duties by the
second defendant, or of intentionally or negligently wrongful conduct on their
part, or of a patrimonial loss by the plaintiffs resulting from any such conduct.
9. The plaintiffs have consequently failed to make averments in claim V(1) to
sustain a cause of action on Aquilian principles.
[465] I uphold the first defendant's exception that claim III(1) lacks averments
necessary to sustain a cause of action
1. on the same grounds as I have upheld the second defendants' exception to
claim V(1);
2. on the further ground that the plaintiffs have in any event failed to make factual
averments that, if proved, would establish vicarious liability on the part of the
first defendant for the allegedly delictual conduct of the second defendants;
and
3. on the further ground that the plaintiffs have in any event failed to make factual
averments that, if proved, would justify the conclusion that claim III(1)
embodies a right of action against the first defendant in delict, based on a legal
duty that arises independently of the tripartite relationship between the parties,
and that is therefore to be recognized as a right of action concurrent with the
plaintiffs' contractual rights of action asserted against the first defendant in
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claims I, II(1)(Part A) and II(1 )(Part B).
[ 466J I uphold the second defendants' exception that claim V(2) lacks averments
necessary to sustain a cause of action
1. on the same grounds as I have upheld their exception to claim V(1); and
2. on the additional ground that the plaintiffs' averment that the letter in which the
second defendants informed the plaintiffs that their drawings for the temporary
works had been approved as compatible with the design for the permanent
works had contained a misstatement, was an averment that added nothing
material to the plaintiffs' averments in claim V(1).
[467] I uphold the first defendant's exception that claim III(2) lacks averments
necessary to sustain a cause of action on the same grounds as I have upheld their
exception to claim III(1).
Amendment and Costs:
[468] The exceptions must be upheld and, in the usual way, the plaintiffs must be
afforded an opportunity to amend their particulars of claim. This being a matter of
considerable complexity, more time than the usual period of one month will probably be
needed. I shall make provision for it in the order.
[469] No reasons have been advanced why costs should not follow the result, or why
the costs of two counsel should not be allowed to each of the defendants.
ORDERS
[470] For the reasons set out above, I make the following orders:
1. The first defendant's exception that neither claim III in the plaintiffs' particulars
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of claim, nor the alternative to claim III, discloses a cause of action succeeds -
(1) on the ground that claim III and the alternative both lack averments
necessary to sustain an action against the second defendants; and
(2) on the further ground that, in any event, claim III and the alternative both
lack averments necessary to establish vicarious liability on the part of the
first defendant for any delict committed by the second defendants.
2. The second defendants' exception that claim V in the plaintiffs' particulars of
claim and the alternative to claim V both lack averments necessary to sustain
an action against the second defendants is upheld.
3. The plaintiffs are ordered to pay the first and second defendants' costs of
these exceptions, including the costs of two counsel for each of the
defendants.
4. Leave is granted to the plaintiffs to deliver a notice of intention to amend the
particulars of claim within two months after the date of this judgment, or such
further period as may be agreed or, failing agreement, as may be allowed by
further order of this court on application by the plaintiffs delivered before the
expiry of two months from the date of this order.
M.S. STEGMANN JUDGE OF THE HIGH COURT
Date of Judgment: 6th January 2006
Counsel for the First Excipient (First Defendant): MR R J RAATH, SC
MR J D MARITZ
Instructed by: THE STATE ATTORNEY (Ref: Mr C E DUVENAGE)
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Counsel for the Second Excipients (Second Defendants): MR C D A LOXTON, SC
MR L J VAN DER MERWE
Instructed by: DENEYS REITZ INC (c/o MaciNTOSH, CROSS & FARQUHARSON) (Ref: MR J VAN DER MERWE)
Counsel for the Respondents (Plaintiffs): MR W H KLEVANSKY, SC
MR K J TRISK Instructed by: RAMSAY WEBBER & CO (c/o ADAMS & ADAMS)
(Ref: MR R BRUTON)
INDEX TO JUDGMENT Page Para Foot noteThe parties 4 9
The plaintiffs' particulars of claim 5 12
19.06.'96 - The consultancy agreement 5 13 2
30.07.'97 - The building contract 7 18
The plaintiffs' contention relating to the method of construction 14 31
06.07.'98 - The failure of the partly constructed bridge 16 35
21.08. '98 - The agreed sequence of failure 16 35 29
The plaintiffs' case in delict and the exceptions, broadly stated 19 42
Para 49 of the plaintiffs' particulars of claim 28 59
The light thrown on para 49 by claim I 31 65
The first alleged design fault 33 72
The second alleged design fault 35 76
Para 35.3.2, 'the codes of practice for the design of bridges in SA' 41 85 too vague
.
The light thrown on para 49 by claim II(1) 42 88 49The light thrown on para 49 by claim III(1) 46 92 54
The light thrown on para 49 by claim III(2) 54 99 73
No reference to para 49 in claim IV 61 107
The light thrown on para 49 by claims V(1) and (2) 61 108 98
Summary of para 49 68 117
Further arrangement of judgment 79 118
The background of the plaintiffs' claims in delict 82
Claim 1 82 120
GCC 45 (Time for completion) 82 120 120
GCC 51 (Claims procedure) 84 120 121
Completion due by 10th November 1998 86 121 122
GCC 60 (Notice of disagreement) 89 128 130
30.01.'01 - Second defendants' ruling rejecting claims for time 91 135 extension and for costs of rebuilding
GCC 6(1) (Plaintiffs' obligations) 91 137
Project Specification 2.2.4 – Bridge work 91 138
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Foot
Page Para note
GCC 49(2) and (3) (CPAF) 92 136 143
GCC 61(4) (Court proceedings) 93 139 147
Claim II 94 142
Claim II(1) 95 143
GCC 35(1) and (2) (Plaintiffs' obligation to care for the 96 145 153works and materials, subject to 'excepted risks', and rights to payment for repairing and making good damage to and loss of works and materials)
GCC 1(1)(k) - 'Due completion date' 97 147 154
GCC 1(1) (h) - 'Cost' 97 147 155
GCC 39 - 'Variations' 97 147 155
GCC 40 - 'Valuation of variations' 98 147 155
Claim II(1)(Part A) 99 149
Claim II(1)(Part B} . . 100 155
Whether claim II(1)(Part B) discloses any valid cause of 105 160 action in contract The relevance of concurrent claims in contract and delict 106 163 against the first defendant
The shortcomings in claim II(1)(Part B) 111 172
GCC 36 (Reciprocal indemnities between first defendant 118 181 185 and plaintiffs)
The indemnity given by the first defendant to the plaintiffs 118 182
Claim II(2) 121 186 191
GCC 16(5), (6) and (9) - The plaintiffs bound by 122 186 193 drawings, specifications and instructions of second defendants
Claim IV - for unpaid balance of certificate 39 123 188
GCC 52 - Monthly payments 123 188 197
Summary of plaintiffs' contractual claims 125 189
The plaintiffs' claims in delict 127 190
Table comparing contractual and delictual claims 129 192
The plaintiffs' delictual claims against the first defendant 130 193
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The plaintiffs' allegations of negligent and wrongful breaches of 131 196 legal duties by the second defendants The plaintiffs' reliance on the consultancy agreement for the 132 197 purposes of their claims in delict
Consultancy Agreement ('CA') 3.3 - First defendant to 132 219 authorize second defendants to act as his agents CA 4.1 - the second defendants are to act both as the first 132 220defendant's agent and as an adjudicator to adjudicate between the plaintiffs and the first defendant. There is no contract between the first and second defendants. CA 4.2 - the second defendants are to exercise reasonable 133 197.3 221 skill, care and diligence CA 4.6.1 - the second defendants are to administer and 133 197.4 222 inspect the works CA 4.6.3 - the site staff are the second defendants' agents 133 197.5 223under their control CA 4.7.1, 4.7.2 and 4.7.3 - the purpose of the second 134 197.6 224 defendants' site visits and site staff
..
CA 4.11 - the second defendants' services to be rendered in 135 197.7 226four stages
The plaintiffs' averments common to all claims, including the 136 198 claims in delict
The second defendants' design for the nose determined the 137 198 positioning of the temporary bearings GCC 16(11) - the plaintiffs' designs and drawings to be 137 199 231 approved by the second defendants and, once approved, not to be departed from without written consent from the second defendants Project specification 2.2.4 (Bridge work) 137 199 232
Project specification B9104 (Nose) 138 199 233
13.5.'98 - the second defendants approve the plaintiffs' 138 199 235 designs and drawings for the temporary works
06.07.'98 - the collapse of the partly built bridge 138 200
The second defendants issue an instruction suspending the 138 200 237 works 25.08.98 - the second defendants allow the demolition and 138 200 238removal of damaged parts of the works The second defendants design a 'new bridge' and the 139 202 plaintiffs build it
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Foot
Page Para note
The plaintiffs' allegations in claim V concerning the duties owed by 139 the second defendants
Claim V(1) - Wrongful and negligent conduct 139 203
CA 4.2 - second defendants to exercise reasonable skill, care 140 203.1 244 and diligence
CA 11.3 - design and tender stage 140 203.1 244
CA 11.4 - construction stage 140 203.1 244
Particulars of claim, para 84 141
Particulars of claim, para 85 143
Particulars of claim, para's 86 to 88 144
Claim V(2) - alternative claim for wrongful and negligent 145 205 misstatement
Claim III - alleged vicarious liability of first defendant 147 209
Claim III(1) - alleged vicarious liability of first defendant to the 147 210 plaintiffs for breach by the second defendants of their obligations under their contract with the first defendant Claim III(2) - alleged vicarious liability of the first defendant for the 150 216 misstatement by the second defendants
Patrimonial loss - second defendants' attack 151 218
plaintiffs' response 154 221
Botha v Rondalia - collateral source rule 156 223
Is the building contract a collateral source wholly independent 164 234 of the alleged wrongdoer?
The contents of the building contract 164 235
. The relationship between the three parties, in the light of 166 239 Lillicrap Is the building contract analogous to an insurance contract 177 255 taken out by the plaintiffs?
Equity, fairness, the interests of society and public policy 181 260
Did the plaintiffs have to build a new bridge 'for nothing'? 188 266
The logical problem involved in reducing the plaintiffs' delictual 188 267 claims by the value of their contractual claims
Holscher v ABSA 189 268
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Mouton v Die Mynwerkersunie 191 270
Lloyd-Gray Lithographers v Nedbank 192 271
The Apportionment of Damages Act, 34 of 1956 195 275
Summary of the logical problem 204 297
The suggested self-contradiction by the second defendants 205 298
Summary with regard to patrimonial loss 206 300
The plaintiffs' patrimonial loss 208 301
Pure economic loss: is it a relevant consideration in this case? 209 303
Administrateur, Natal v Trust Bank, 1979 210 304
LAWSA definition of pure economic loss 210 305
Distinction between application of Aquilian principles to 217 316 situations authoritatively recognized before 1979, and to 'new' situations potentially recognizable since 1979. Smit v Saipem, 1974 219 318
Shell & BP v Osborne Panama, 1980 225 329 227 333 Osborne Panama v Shell & BP, 1982
.
Franschhoekse Wynkelder v SAR & H, 1981 229 335
Tobacco Finance v Zimnat insurance, 1982 230 337
Coronation Brick v Strachan Construction, 1982 231 338
Sea Harvest v Duncan Dock Cold Storage, 2000 231 339
The Oil Rig 'South Seas Driller' v Pride Foramer, 2001 234 343
Conclusion in respect of pure economic loss 242 357
English law cases on pure economic loss 242 358 ...
Must the plaintiffs allege facts that justify the legal inference that 243 360 the second defendants owed them a legal duty and breached it? The plaintiffs' submissions that Lillicrap is distinguishable 244 361
Tsimatakopoulos v Hemingway, 1993 245 363
Cathkin Park v Makesch, 1993 249 369
Goldstein v Cathkin Park, 2000 250 371
Concurrent rights of action in contract and delict 253 376
The second defendants' grounds of exception to claim V(1) 256 383
Ad para 84 256 384
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Page Para Foot note
The reservation relating to claim II(1)(Part B) 264 401
Ad para 85.1 . 265 403
CSRA 1221 265 403 388
CSRA 1205 266 403 389
CSRA 6203 390
CSRA 8104 391
CSRA 8308 392
GCC 6(1)(b) and (2) 393
GCC 35 267 403 399
GCC 36 400
GCC 55(1) nd (2) - Final approval certificate 402
Project specification 2.2.4 (Bridge work) 268 403 403
The second defendants'. approval of the plaintiffs' 272 410 drawings did not oblige the plaintiffs to attempt to build an 'unbuildable' bridge: cf Goldstein v Cathkin Park Lillicrap governs the tripartite relationship in the present 275 416 matter
Ad para 85.2: criticism not justified 278 424
Ad para 86: inconsistent with the building contract and 279 428 Lillicrap Ad para 87: it contains a non sequitur 280 432
Ad para's 88 and 89 282 436
Ad causation of loss . 282 437
Exceptions to claim V(1) upheld 284 441
Second defendants' exception to claim V(2): misstatement 284 442
First defendant's exception to claim III(2) interposed 286 444
Exceptions to claims III(1), III(2) and V(2) upheld 291 451
The alleged vicarious liability of the first defendant 291 452
Eksteen v Van Schalkwyk. 1991 294 456
Absence of grounds for the plaintiffs to enjoy concurrent claim in 299 462 contract and delict against the first defendant
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Page Para Foot note The second defendants' application to strike out in terms of Rule 300 463
30
Summary 300 464
Amendment and costs 305 468
Orders 305 470