PERSAND & PARTNERS CO LTD v CWA 2012
SCJ 61
With regard to the first point it
relies on the case of Desbro
Trading Ltd v Ragavoodoo Bros & Co, in the presence of the Central Water
Authority [1997 SCJ 132]. That case also basically
concerned the late execution of a contract for the timely supply of materials with a
penalty clause in case of late delivery. It is distinguishable from the present one in
that Ragavoodoo Bros & Co had not shown that the delay on the part of Desbro had
resulted in Ragavoodoo being delayed in the discharge of its own contractual
obligations to the CWA, whereas here it is the CWA itself, as a water supplying
Authority for the whole island, be it for domestic or industrial use, which is the
defendant. Therefore to that extent, whereas Ragavoodoo would have had to show that it
had to pay penalty to the CWA for delay that cannot be the case for the CWA
when the latter is itself the end user of the goods supplied, under the
contract.
I therefore take the view that the
terms of the contract which have undisputedly been accepted by the defendant
should apply strictly and penalty is payable for delay as was the obvious
express intention of the parties, subject to what the defendant acknowledged to
be justified delay, because the plaintiff was not responsible for the same.
As regards the need to put the
defendant “in
mora” before
entering the claim, counsel for the defendant has rightly referred to the
relevant part of the case of Bourgault du Coudray v. Min Kan [1982 MR 33] on which the plaintiff seeks to
rely in support of its contention. In that case the Court refers inter alia to Art 1139 of the French Civil Code then in force in Mauritius. Art 1139 of our Civil Code, enacted in 1983, is a textual
replica of the same. It reads as follows:-
“1139. Le débiteur est
constitué en demeure, soit par une sommation ou par autre acte équivalent,
soit par l’effet de la convention, lorsqu’elle porte que, sans qu’il
soit besoin d’acte et par la seule échéance du terme, le débiteur sera
en demeure.” (Emphasis
added).
And this is what the Court says at
page 3 of its judgment in Bourgault du Coudray (supra):
“That is why, when it is
the intention of the parties that the “clause pénale” should become operative
without a “mise en demeure” the practice is to add some such clause as “et ce,
par la seule échéance du terme, et sans qu’il soit besoin de mise en demeure ou
de toute autre formalité quelle qu’elle soit.” (Emphasis added).
In the present case it is not
disputed that the contract, admitted to be binding on the parties, to all the
conditions of which the plaintiff stated it is agreeable in its letter of 8 May
1998, makes provision for penalty for late delivery to be payable to the
defendant “without
any notification of claim being sent to the plaintiff”. Therefore on the very authority
relied upon by the plaintiff, the defendant had by the terms of the contract
expressed the intention that there would be no need for any “mise en demeure”, and the plaintiff had agreed
thereto. It cannot now be heard to turn round, and purport to go back on what
was the common intention of the parties. (Emphasis added).
The evidence otherwise shows on a
balance of probabilities that the plaintiff has been less than diligent in the
execution of its part of the contract, not exclusively for reasons beyond its
control, but also on account of delay on the plaintiff’s part to open the
letter of credit which delay the plaintiff has remained eloquently silent
about.
The plaintiff is therefore not
entitled to its claim in toto, but only to part of it as will be seen
below.
Counsel for the defendant has also
aptly quoted from the judgment of the Supreme Court in the case of Sun Trust v. State of
Mauritius [2004
SCJ 9] with regard
to the legal basis for retaining an amount from the contract price as penalty
for delay of delivery. It is apposite to quote
the following therefrom with reference to note 61 of Encyclopedie Dalloz, Droit
Civil Vol III Vo. Clause Penale:-
“61.
..................................................................... Comme
l’exprime l’alinéa 1er de l’article 1152, conformément au principe posé par
l’article 1134 du code civil: «lorsque la convention porte que celui qui
manquera de l’exécuter payera une certaine somme à titre de dommages-intérêts,
il ne peut être alloué à l’autre partie d’une somme plus forte ni moindre.»
Forfaitaire, la peine doit s’exécuter telle qu’elle a été fixée par les
parties. ”
The above must, however, be read subject to
the provisions of Article 1147 of our Code Civil which reads:-
“Le débiteur est condamné s’il y a
lieu, au paiement de dommages et intérêts, soit à raison de l’inexécution de
l’obligation, soit à raison du retard dans l’exécution, toutes les fois
qu’il ne justifie pas que l’inexécution provient d’une cause étrangère qui ne
peut lui être imputée, encore qu’il n’y ait aucune mauvaise foi de sa part.”
(Emphasis added).
It is noteworthy that the defendant in the
present case has, to its credit, decided to treat the plaintiff fairly and
reasonably, by reducing the penalty proportionately for the part of the delay
which the plaintiff had shown to the defendant was beyond the plaintiff’s
control and for which it could not be blamed or held responsible.
MATIKOLA RAMKELAWON v ROSE BELLE S.E
BOARD 2012 SCJ 62
This is a claim by way of plaint with summons
for goods sold and delivered, as well as for damages for wrongful termination
and/or breach of contract.
The first and principal matter in issue is
whether the alleged defect in the products, supplied by the plaintiff, as
invoked by the defendant in purported justification of its non payment for the
same and its putting an end to the contract, was because the products did not
contain active ingredients as per specification.
It would be apposite to consider the provisions
of Article 1641 of the Civil Code, under the headings “De la garantie des défauts de la chose vendue”, which finds its application in the case in hand. Article 1641 provides:-
“1641. Le vendeur est tenu de la
garantie à raison des defaults cachés de la chose vendue qui la rendent
impropre à l’usage auquel on la destine, ou qui diminuent tellement cet usage,
que l’acheteur ne l’aurait pas acquise, ou n’en aurait donné qu’un moindre
prix, s’il les avait
connus.”
The vendor’s guarantee under Article 1641 concerns latent defects (“vices cachés”). One can read from Juris Classeur Vo. Vente: Garantie Légale
Contre Les Vices Cachés. Art. 1641 a 1649: Fasc 30;
Note 1:
“L’existence n’en est admise qu’au cas
ou il présente une certaine gravité.”
It also appears from Note 6 that the defect aimed at must constitute:
“toute défectuosité qui empêche la
chose de rendre, et de rendre pleinement, les services que l’on attend. Il
résidera dans ………….. l’impossibilité de s’en servir dans les conditions satisfaisantes,
les conséquences nuisibles produites à l’occasion d’une utilization normale.”
One also sees at Note 7, that it must be established that:
“La qualité faisant défaut soit une des
principales que l’on reconnait à la chose”.
It cannot be disputed that in the case of
herbicides, the proportion of active ingredients characterises the
effectiveness or lack of it for the purpose for which it has been bought.
At Note 51 the relevant part reads:
“Il ne suffit pas que la chose soit
atteinte dans une de ses qualities principales. Il faut encore, pour menacer le
contrat passé, que le vice ainsi révélé présente une gravité suffisante …………….”
And the relevant part of Note 52 reads:-
“Les juges du fond semble disposer d’un
pouvoir souverain pour apprécier la gravité de l’inexécution justifie la
résolution ………………..”
The plaintiff’s case is aggravated by the fact
that he purported to certify as to the analysis and quantity of the active
ingredients himself, departing from the condition of the contract (condition 12
of the terms and conditions) that a certificate of analysis from an accredited
laboratory had to be provided at the time of delivery. In spite of the
defendant’s acceptance of delivery with such defective certificate of analysis,
upon the problem arising, it has become clear that the plaintiff chose not to
be strictly compliant with such condition at its own risks and perils.
Furthermore, the defendant has shown through
witness Umrith’s evidence and report, which has remained unrebutted, that the plaintiff
failed to comply with the requirements of the 6th schedule of the Dangerous Chemicals Control Act 2004 in that the labelling in respect of the Diuron
containers supplied to the defendant by the plaintiff was incomplete inasmuch
as it did not show the date of manufacture, the active ingredients and their
concentration, the expiry date, and health hazards.
The matters highlighted above also show that
the plaintiff had failed with regard to matters which struck at the root of the
contract (“une atteinte dans
une de ses qualités principales”) and constituted breaches which were so serious (“un vice présentant une gravite
suffisante”) that the defendant was
justified in treating the contract as at an end and to repudiate it on account of such fundamental breaches
on the plaintiff’s part. The plaintiff has failed to
perform its part of the contract in that what it in fact supplied to the defendant was fundamentally different from what it had
contrasted to supply.
The plaintiff having acted in fundamental
breach of contract, the defendant was entitled to repudiate the unperformed
part thereof. I therefore hold that the plaintiff is not entitled to damages as
claimed, or at all. He has only himself to blame for the fundamental breach of
contract and cannot therefore pray in aid the fact that he had already ordered
and stocked half of the contract order, and has only been able to sell for some
Rs 200,000 elsewhere.
V5 CO. LTD. v KHODABAKUS 2012 SCJ 116
This is an appeal against a judgment of the
learned Magistrate of the Intermediate Court dismissing a claim for damages by
the appellant, then plaintiff, for the alleged breach of an option agreement
for the purchase of the respondent’s property.
Three central issues namely, whether: (a) the
learned Magistrate did not err in law in considering the nature and scope of
the ‘levée de l’option’ by the appellant; (b) the respondent had
furnished all the requested and requisite documents for the drawing up of the deed
of sale and; (c) the entire burden to formalise the deed of sale rested on the
appellant and that the respondent could simply adopt a passive role.
It was the clear intention of the parties in
the agreement that the payment of damages under the ‘Clause Pénale’ would
only arise ‘qu’au cas où je (respondent) ne me présente pas pour la
signature du contrat.’ In that respect for all the given reasons, the
learned Magistrate cannot be faulted when she reached the conclusion that the “triggering
factor for the activation of clause 6 would be defendant’s failure to
appear before a Notary Public to execute the deed of sale”. It is
not in dispute that he was never summoned to appear before a Notary to execute
the deed of sale.
But at no time did the appellant ever summon
the respondent before a Notary as has rightly been pointed out by the learned
Magistrate. It was clearly incumbent upon the appellant to summon the
respondent before a Notary as per clause 6 of the ‘option’ agreement.
We therefore find no fault in the reasoning of
the learned Magistrate in finding that the appellant cannot succeed in its
claim inasmuch as it had failed to summon the respondent for the signing of the
deed before the Notary.
On the issue of whether the whole burden
rested on the appellant to formalise the deed of sale while the respondent
could just adopt a passive attitude, we again agree with the reasoning of the
learned Magistrate. The appellant did nothing for a relatively long span of
time, following his ‘levée de l’option’ on 5 May 2007. It was only much
later on 6 May 2008 that he initiated action for damages against the respondent
and, this too, after learning that the respondent had sold the property to a
third party. The learned Magistrate was right in finding, in view of the state of the
evidence that, far from having adopted a passive role, the respondent has done
his upmost to try and obtain a certified location plan. When he informed the appellant’s
préposé at his office of his inability to obtain the said document, he was
informed that he would be summoned before a Notary for the drawing up of the
deed of sale. The learned Magistrate rightly considered that “it was for the
Notary in charge of the sale to say that the SR & SP submitted was
incorrect (if at all) and request a fresh one”. The appellant never in fact
asked the respondent to attend the office of a Notary Public in accordance with
clause 6 of the ‘option’ agreement after he had exercised his right to the
‘option’ on 5 May 2007.
For all the above reasons, we consider that
the learned Magistrate cannot be faulted for concluding that, on a balance of
probabilities, the appellant has failed to prove that the respondent has acted
in breach of the ‘option’ agreement and is entitled to the payment of any damages.
NOVALIS INTERSERVICES LTD v THE ATTORNEY-GENERAL
2012 SCJ 194
This is an appeal
from a judgment of the learned trial Judge dismissing a claim by the appellant,
then plaintiff, against the defendant, now respondent, for damages for breach of contract
or, in the alternative, for “rupture abusive des négociations avancées” after she had found,
first, that there was no valid contract between the parties, let alone any breach thereof,
and, secondly, that the withdrawal of the award of the tender was neither unreasonable
nor of bad faith.
On that evidence the
learned trial Judge found that the intention of the parties was that a valid
contract would only come into existence once a written contract would have been duly
signed by the parties. In the absence of any written contract, she concluded that the
action for breach of contract must fail. The learned trial Judge also found that, in view
of the series of negotiations following the letter of award of 16 October 1996, the
several counter proposals of the appellant, the initial commencement date of the project,
and the several disturbing matters relating to the internal affairs of the appellant
company, the decision of the Registrar-General not to accede to yet a further postponement
of the project and to withdraw the award could not be considered as having been
unreasonable or in bad faith. She accordingly held that the alternative claim for damages
for “rupture abusive des négociations avancées” must equally fail.
It is clear that the
acceptance of the tender and the issue
of the letter of award of 16 October 1996 could not constitute a contract between the
parties, the more so as the letter of award itself required the appellant, in case
it agreed with the terms and conditions laid down therein, to call upon the
Registrar-General at a given date to sign the contract – which would start on a particular date and
span over a period of two years – and provide the required performance bond and
bank security for the advance payment. In the circumstances, we take the view
that the learned trial Judge rightly concluded that the letter of awardclearly indicated
that the intention of the parties was that there would be a written
contract duly signed
by them after they would have agreed upon all the conditions.
The evidence on
record shows that the parties
were still negotiating even as late as August 1997, with the appellant always trying to
steal a march over the client Department over the date of commencement of the
contract – which we consider to be an essential term of the
contract. There was
never any “accord de volontés”.
In the
circumstances, the learned trial Judge was right in holding that there was no contract between
the parties, and accordingly there was no breach of any contract and still less any
requirement to have recourse to justice to terminate it. The first three grounds of appeal
accordingly fail.
Now, the record
shows that, as highlighted above, as from the issue of the letter of award, both
parties entered into a series of negotiations, with the appellant always trying to secure
more favourable terms for itself. The learned trial Judge was alive to that state of
affairs and concluded that “the end result was that the parties were negotiating, in the
words of French commentators, a ‘contrat par étapes’ ”.
She then referred to
Précis Dalloz, Droit Civil, Les Obligations: François Terré, Philippe
Simler, Yves Lequette (5o Ed) at paragraph 177
–
“ En principe
libre d’interrompre les pourparlers, chacun de ceux qui y
participent engage
néanmoins sa responsabilité lorsque la rupture dont il
prend l’initiative
présente un caractère abusif … …
En pratique, la
mauvaise foi consistera à prendre l’initiative de la
négociation sans
intention sérieuse de contracter, à seule fin de dissuader
le partenaire de
négocier avec autrui ou pour obtenir la révélation de
certains secrets, à
prolonger une négociation qu’on sait ne plus pouvoir
conclure ou encore à
rompre ‘sans raison légitime, brutalement et
unilatéralement des
pourparlers avancés’. Soucieux de ne pas
compromettre à
l’excès la liberté contractuelle, les tribunaux exigent une
faute patente,
indiscutable … …”
before asking the
question, rightly in our view, whether the Registrar-General acted unreasonably and in
bad faith in withdrawing the award. In determining this question, she took into
consideration -
(a) the fact that after 03 April 1997, the
appellant had been requested on no less than four
occasions to come and sign the contract;
(b) the qualms of
the Registrar-General in April 1997 which the learned trial Judge considered to
be “understandable”;
(c) the refusal of
the respondent to sign the contract as late as September 1997 and the time
that had elapsed since the issue of the letter of award which itself
indicated the initial date for the start of the data capture project as being 10 January
1997 before concluding
that the stand of the Registrar-General on the appellant’s counter proposal made on 25
August 1997 could not be said to be so unreasonable as to amount to a “faute
patente, indiscutable”.
In the light of the
evidence placed before the learned trial Judge, we are unable to say that she was
wrong.
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