C of A
(CIV) 1/2005

IN THE COURT OF APPEAL OF LESOTHO

Held at Maseru

MNM CONSTRUCTION COMPANY (PTY) LTD APPELLANT

and

SOUTHERN LESOTHO CONSTRUCTION

COMPANY (PTY) LTD 1^ST RESPONDENT

EDUCATION
FACILITY UNIT 2^ND RESPONDENT

MINISTRY
OF EDUCTION 3^RD RESPONDENT

ATTORNEY-GENERAL
4^TH RESPONDENT

CORAM: STEYN, P

GROSSKOPF,
JA

MELUNSKY,
JA

SUMMARY

Confusion as to the identity of the appellant –
unjustified urgent applications – failure to observe requirements
for interdicts
– factual dispute on papers fatal to applicant’s
case.

JUDGMENT

GROSSKOPF, JA

[1] The appellant was the first respondent in the court
a quo and I shall refer to it as “the first
respondent”. The applicant in the court a quo is now
the first respondent but I shall refer to it as “the applicant”.
There appears to be a confusion as far as the identity
of the first
respondent is concerned. The applicant’s notice of motion cited the
first respondent as MNM Construction Co. (Pty)
Ltd (“MNM
Construction”), but in paragraph 2.1 of its founding affidavit the
applicant referred to the first respondent as MNM
Development Company
(Pty) Ltd (“MNM Development”). The deponent who deposed to the
answering affidavit on behalf of the first
respondent did so in his
capacity as managing director of MNM Construction, but then proceeded
to admit paragraph 2.1 of the founding
affidavit which referred to
the first respondent as MNM Development. The joint venture agreement
which formed the basis of the applicant’s
case in the court a
quo had been entered into between the applicant and MNM
Development, and the tender for the construction of the Litsebe
Primary School
(“the school”) was made in the name of MNM
Development. The Government’s building contract was however awarded
to MNM Construction.
The judgment of the court a quo
was eventually given against MNM Construction. There is certainty on
one point, viz. that MNM Construction and MNM Development are
two
separate personae.

[2] The parties did not clarify the position in the
court a quo and they did not set the record straight in
this connection. As the matter stands MNM Development was the party
who had entered into
the joint venture agreement with the applicant,
but the court a quo ordered a third party, MNM
Construction, to comply with the terms of that joint venture
agreement. This problem was first raised
by members of this court
when the appeal was heard but counsel for the applicant was unable to
suggest how the situation could be
rectified at this stage. In my
judgment the appeal should succeed on this ground alone. I shall,
however, also deal briefly with
other reasons why the appeal should
be upheld in my view.

[3] This is once again one of those unfortunate cases
where the applicant, without justification, brought an ex parte
application on the ground that it was urgent. There was no reason in
my view why the founding papers in this matter could not have
been
served on the respondents in the ordinary manner. This court has
reiterated time and again that litigants should resort to this
practice only in exceptional cases. If practitioners continue not to
heed this warning this court will be obliged to award costs
de
bonis propriis in appropriate cases. See Commander
L.D.F. and Another vs Matela L.A.C. 1995-1999, 799 at
804-805.

[4] A further practice which cannot be sustained is the
indiscriminate granting of rules nisi. In the present matter
the High Court granted a rule nisi on 30 July 2004 in the
absence of the respondents. An interdict was granted against the
first respondent restraining it from proceeding
with the building of
a school and prohibiting it from receiving payment for its services.
The applicant succeeded in obtaining the
interdict without
establishing the essential requirement that there was a well-grounded
apprehension of irreparable harm to it if
the interim relief is not
granted. The applicant in my view failed to satisfy a further
requirement for an interdict, namely that
it has no other
satisfactory remedy. (See generally Herbstein and Van Winsen, The
Civil Practice of the Supreme Court of South Africa, 4^th
ed, 1065, for these requirements.)

[5] The court a quo confirmed the rule
without observing the requirements for an interdict. The court
accordingly granted the applicant an order in terms
whereof the first
respondent was “interdicted from continuing to build (the school)
unilaterally against the spirit of the joint
venture, …… pending
the determination hereof”. The first respondent was further ordered
to “account and disclose all financial
dealings in relation to the
joint venture to the applicant”. The second respondent, who was
also the second respondent in the court
a quo, was
ordered in turn to “withhold all monies from first respondent in
relation to the joint venture, pending the finalisation of
this
matter”. The first respondent appealed against this order of the
court a quo.

[6] It is common cause that MNM Development and the
applicant entered into a joint venture agreement on 25 August 2003 to
tender jointly
under the name of MNM Development for the construction
of certain primary schools. The parties further agreed that all
expenses and
all profits would be shared equally by them. It is the
applicant’s case that the second respondent awarded a tender to the
joint
venture to build

the school, but that the first respondent has failed to
account to the applicant or to disclose to it any of its financial
dealings
in relation to the joint venture.

[7] The first respondent’s version, as set out in its
answering affidavit, is that the second respondent refused to accept
a tender
from the joint venture but insisted that each company should
submit its own tender, which the first respondent then did. The first
respondent’s tender was accepted on 28 November 2003. What happened
thereafter is explained as follows by the first respondent
in its
answering affidavit.

“Despite
the attitude of the Ministry …(the) parties agreed verbally to give
effect to their joint venture agreement by going into
execution of
the said contract jointly. In fact the parties immediately went to
the site for purposes of excavation. When they had
to deliver
material to the site, applicant pulled out of the joint venture as a
result of the inaccessibility of the site, which
made the whole
operation more expensive.

Following applicant’s withdrawal … 1^st
respondent proceeded with the contract between it and 2^nd
respondent and on or about 26^th June 2004
applicant submitted its pro rata expenses prior to its withdrawal and
1^st respondent duly paid with a bank cheque,
a copy of which is hereto attached …”

[8] The applicant in its replying affidavit admitted
that the first respondent had paid for expenses with a bank cheque
but then went
on to give the following explanation:

“this
is the payment of the expenses that the applicant has incurred in
trying to implement the offer of the 2^nd
respondent ….. Since the applicant had already incurred expenses it
was entitled to the money as a share from the joint venture.”

This admission by the applicant lends some credence to
the first respondent’s version that despite the government’s
refusal to
accept a tender from the joint venture the parties orally
agreed to give effect to their joint venture agreement and in fact
started
with the work.

[9] The applicant does not explain why it dropped out of
the joint venture. It does however deny that it ever withdrew or
intended
to withdraw from the joint venture and described the first
respondent’s allegations in this regard as “hearsay”. There was
therefore a clear and genuine dispute of fact that could not be
resolved on the papers, i.e. whether the applicant had withdrawn
from
the joint venture or not. The court a quo however
concluded that the first respondent’s allegation that the applicant
had in fact withdrawn from the joint venture agreement:-

“has
just been an allegation as nothing was attached to the papers to show
that in fact applicant withdrew from the contract. Since
it was the
first respondent who alleged the

withdrawal, he ought to prove it and in the absence
of any such proof they must fail in their defence.”

[10] In my judgment the learned judge in the court a
quo erred in this respect. There was no onus on
the first respondent in these circumstances. The legal position is
clear. Where in proceedings on notice of motion disputes of
fact have
arisen on the affidavits, a final order, whether it be an interdict
or some other form of relief, may only be granted if
those facts
averred in the applicant’s affidavits which have been admitted
by the respondent, together with the facts alleged by the
respondent, justify such an order. (Plascon–Evans Paints Ltd
v Van Riebeeck (Pty) Ltd 1984 (3) SA 623 (A) at 634 E-635 C;
Ramahata vs Ramahata LAC (1985-1989) 184 at 185 E-H;
Makhutla and Another v Makhutla and Another C OF A (CIV)
No.7 of 2002). The facts averred by the applicant and admitted by the
first respondent, together with the facts alleged
by the first
respondent, i.e. that the applicant withdrew from the joint venture,
did not justify a final order. The order of the
court a quo
cannot therefore be sustained.

[11] In the result the following order is made:-

1. 
   The appeal is upheld with costs.

   
   

2. 
   The order of the court a quo is set aside
   and there is substituted therefor the following order:

   
   

“The
rule nisi
is discharged and the application is dismissed with costs.”

______________________

F.H. GROSSKOPF

JUDGE OF APPEAL

I
agree _________________________

J.H. STEYN

PRESIDENT

I
agree _________________________

L.S. MELUNSKY

JUDGE
OF APPEAL

Dated at Maseru this 20^th day of April 2005.

For Appellant : Mr M. Ntlhoki

For
1^st Respondent : Miss Mapesela