HIGH COURT OF LESOTHO
YEH t\a TODAY'S CONSTRUCTION Defendant
by the Honourable Mr. Justice J.L. Kheola on the 6th day of April
action the plaintiff claims from the defendant the following:
sum of M13, 115.45 made up as follows:
(i) M1727.39 being Plaintiff's mortgage instalment to the LBFC for
the month of July, 1991;
(ii) M1l,388.06 being the total of Plaintiff's mortgage instalments
to the LBFC for the months of August 1991 to January, 1992
rate of M1898.01 per month;
(b) Interest on the amounts in (a) (i) and (ii) above at the rate of
17% per annum from July 1991 to date of payment.
(c) An additional amount of M1898.01 per month or such other
increased amount as the LBFC shall charge Plaintiff in respect of
monthly instalment from February, 1992 to the date when Defendant
completes the repair work on Plaintiff's house and hands
over to Plaintiff, together with interest at the LBFC's then current
interest rates should any instalment not be paid on due date.
and\or alternative relief.
of this case are not in dispute and they are as follows:
plaintiff engaged the defendant to built for her a residential house
at Moshoeshoe II, Maseru, under a construction agreement
the 16th May, 1989. One of the terms of the agreement provided that
"in case of any dispute or difference between
the Proprietor or
the Architect on his behalf and the Contractor, the matter shall be
referred to the arbitration of the nominee
of the President for the
time being of the Lesotho Architects, Engineers, Surveyors
Association, and his findings shall be final
and binding on both
building of the house was not carried out to the satisfaction of the
plaintiff and this led to disputes between the plaintiff
defendant. The plaintiff did not take the disputes to arbitration but
tried to resolve the matter amicably. In the course
of trying to
resolve the disputes arising from the defendant's bad performance
under the above agreement, the Lesotho
Finance Corporation (LBFC) which had loaned the plaintiff money to
finance construction of the house demanded repayment
of its loan from
Plaintiff was not in the position to repay the loan due to the fact
that she could neither lease nor occupy the house herself
still living in a rented accommodation elsewhere as the defendant was
still in occupation of the house for the purposes
of rectifying the
defects in terms of the contract.
16th July, 1991 a meeting was held at the offices of the plaintiff's
attorneys which was attended by the plaintiff, the defendant,
Makara and Mrs Chimombe who are plaintiff's attorneys, Mr. Mabulu of
Archiplan Studio and Mr. Ntene of Cost Associates. In
regard to item
(c) on the agenda the minutes read as follows:
"Items (c) regarding liability for the resultant losses: Ms.
Khaebana pointed out that she was insisting that the mortgage
payments plus interest due to the Lesotho Building Finance should be
paid by Mr. Yeh, Mr. Yah on the other hand insisted that he
liable for the said amounts for the period he would take possession
of the site while doing the repair work. It was agreed
discussion and finalisation of the issue would be deferred to a later
date and that Mrs. Makara would convene another meeting
the issue specifically.
The meeting adjourned having agreed on all items except item (c)."
common cause that the defendant is refusing to pay the mortgage
instalments. He is of the opinion that the non-fulfilment
undertaking aforesaid as being a dispute or difference between him
and the plaintiff under the construction agreement and
subject to determination by arbitration as provided for under the
agreement. Hence he has raised a special plea in abatement
arbitration is a condition precedent to the above action.
that the minutes quoted above clearly show that there was no contract
because there was no meeting of the minds of
other hand the plaintiff's attorney's submission is that the
defendant's undertaking in the above minutes, although arising
the course of negotiations aimed at rectifying defendant's mistakes
under the construction contract, is an altogether new
does not form a term of the construction contract. So that disputes
arising from it cannot be subject to arbitration
construction contract unless it can be shown that this was the
intention of the parties. The onus falls on the defendant
to prove on
of probabilities that it was in fact the intention of the parties
that disputes arising from this new agreement had to be
arbitration (See French v. Sterling Finance Corporation (Pty) Ltd.
1961 (4) S.A. 732).
to me that the first issue to be resolved is whether at the meeting
held on the 16th July, 1991 the parties reached any
agreement. If it
is found that they entered into any contract the Court will have to
determine whether that was an altogether new
contract which had
nothing to do with the original construction contract and that it
shall not be referred to arbitration. If the
Court finds that there
was no new contract, that will be the end of the matter.
sentence of the minutes of the meeting of the 16th July, 1991 is very
clear. The words used are very simple and straightforward.
cardinal rule of construction is that words must be given their
ordinary, literal, grammatical meaning" - Volschenk
1946 T.P.D. 486 at p. 487.
however, that 'what seems a clear meaning to one man may not seem
clear to another........ The "literal" meaning
something revealed to judges by
a sort of
authentic dictionary; it is only what individual judges think is the
literal meaning' per Schreiner, J.A. in Savage v.
Inland Revenue 1951 (4) S.A. 400 (A.D.) at p. 410.
the words in the last sentence of the minutes their ordinary literal
and grammatical meaning I come to the conclusion that
there was no
agreement. In other words no new contract was entered into.
whole of item (c) of the minutes is read it becomes even clearer that
there was no new contract. It was agreed that discussion
finalisation of the issue would be deferred to a later date and that
Mrs. Makara would convene another meeting to address the
specifically. No such meeting was convened and there is no indication
that the issue was ever discussed again as agreed by
clear that what transpired at the meeting was a discussion but no
agreement. The plaintiff insisted that mortgage payments
interest due to LBFC should be paid by the defendant. On the other
hand the defendant insisted that he was only liable for
amounts for the period he would take occupation of the site while
doing the repair work. The defendant never
pay the mortgage payments plus interest due to LBFC. But the
plaintiff is now claiming the whole amount basing her claim
she regards as an undertaking by the defendant at the meeting of the
16th July, 1991. There was no such undertaking. The
that the discussion and finalisation of the issue would be deferred
to a later date. Finally it was stated in no
uncertain terms that the
meeting adjourned having agreed on all the items except item (c).
to me that what happened was that the defendant was making an offer
that he would pay mortgage instalments plus interest
for the period
he would take occupation of the site while doing the repair work. On
the other hand the plaintiff was insisting
that the mortgage payments
plus interest due to LBFC must be paid by the defendant. She was not
restricting the payment only to
the period during which defendant
would be in occupation of the site while doing the repair work. The
parties did not agree on
the period when the defendant would be
liable. That was the reason why it was agreed that the discussion and
finalisation of the
issue was deferred to a later date.
come to the conclusion that there was no contract between the parties
and that there is no cause
based on any contract.
result the action is dismissed with costs.
Plaintiff - Mrs. Makara
Defendant - Mr. Klaas.
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