Tobacco Processors (Private) Limited v Bak Storage (Private) Limited and Securitas (Private) Limited

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TOBACCO PROCESSORS (PRIVATE) LIMITED
versus
BAK STORAGE (PRIVATE) LIMITED
and
SECURITAS (PRIVATE) LIMITED

HIGH COURT OF ZIMBABWE
PATEL J

Opposed Application

HARARE, 4 October 2011 and 21 February 2012

R. Matsika, for the excipient (1st defendant)
T. Mpofu, for the respondent (plaintiff)



      PATEL J:        The 1st defendant leased its premises to the plaintiff in

June 2009 for the warehousing, storage and related handling of tobacco

bales. The 2nd defendant contracted to provide security services for the

premises and its contents. Following the loss of 1446 bales of tobacco,

the plaintiff sued both defendants for their value in the sum of

US$438,355. The plaintiff’s claim is grounded in contract or, in the

alternative, in negligence.

      The 1st defendant excepts to the claim on the following grounds.

To the extent that it is based on contract, the 1 st defendant relies on its

standard conditions of storage and handling. Clause 1 thereof excludes

liability on grounds other than gross negligence or wilful default, neither

of which has been pleaded, as well as liability occasioned by theft or

vandalism. As regards the claim in delict, it is averred that this is

incompetent because it is for mere economic loss arising from negligent

breach of contract.

      In the event, the principal issue for determination in this matter is

whether or not the plaintiff’s claim discloses a valid cause of action.
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The Declaration

      Paragraphs 9 and 11 of the Declaration set out the claim against

the 1st defendant. They state as follows:

      “9. In breach of the agreement between the Plaintiff and it, the 1 st
      Defendant:
             9.1 Failed to exercise due care and to safely keep the
             tobacco bales delivered at the premises by and from the
             Plaintiff’s clients, resulting in loss of some bales.
             9.2 Failed to account to the Plaintiff for some of the bales of
             tobacco which were delivered at the premises by and from
             the Plaintiff’s clients.”

      “11. Alternatively, the 1st Defendant was at fault or negligent in one
      or more of the following respects:
             11.1 The 1st Defendant failed to take reasonable steps to
                    ensure that the tobacco bales were kept safely.
             11.2 The 1st Defendant failed to take reasonable steps to
                    prevent the theft or loss of the tobacco bales.
             11.3 The 1st Defendant’s employees participated in or
                    abetted the theft of the bales of tobacco which were
                    in their custody.”

Validity of Claims

      Mrs. Matsika contends that under the contract between the parties

the 1st defendant is only liable for gross negligence or wilful default and

that neither has been pleaded in the Declaration. The contract also

excludes liability for theft which is specifically pleaded. Adv. Mpofu

counters that the Declaration does implicitly allege wilful default. In

addition, he submits that a party cannot contractually exclude liability for

wilful misconduct or criminal or dishonest activity, i.e. theft.
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       I fully agree. As was authoritatively enunciated in Tubbs (Pvt) Ltd v

Mwamuka 1996 (2) ZLR 27 (S) at 32 & 34, a party cannot exempt himself

for loss or damage to the property of another that is caused by his own

dolus or that of his employees. To allow him to do so would be contra

bonos mores. I further agree that the allegations enumerated in the

Declaration necessarily imply gross negligence or wilful default on the

part of the 1st defendant. It follows that the contractual exemption from

liability for theft in casu is unenforceable and cannot sustain the

exception to the plaintiff’s claim. Whether there was any theft, wilful

default or gross negligence are matters for determination by evidence at

the trial.

       Turning to the claim in delict, Mrs. Matsika submits that this claim

is incompetent because it is for pure economic loss arising from the

negligent breach of a contract. In essence, the negligence alleged by the

plaintiff is nothing more than the alleged malperformance by the 1 st

defendant of its contractual obligations. The plaintiff is therefore

confined to its contractual claim. She relies in this regard on the decisions

in Lillicrap, Wassenaar and Partners v Pilkington Brothers (SA) (Pty) Ltd 1985

(1) SA 448 (AD) at 499A-501H, and Holtzhausen v ABSA Bank Ltd 2008 (5) SA

630 (SCA) at para. 6.

       As Mrs. Matsika quite correctly submits, these cases provide

authority for the following propositions. No claim is maintainable in delict

where the negligence relied upon consists in the breach of a contractual

term. Where it is alleged that the defendant has negligently performed

its contractual duties resulting in pure economic loss, no cause of action

lies in delict as that would constitute an extension of the Aquilian action

to a contract. The proper remedy arises from the contract itself and lies in

the realm of contractual rather than delictual remedies.
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      However, as was pointed out in the Lillicrap case, at 496D-I, and in

Holtzhausen’s case, at paras. 6 & 7, they do not constitute authority for the

more general proposition that an action cannot be brought in delict if a

contractual claim is competent. The law acknowledges a concurrence of

actions where the same set of facts can give rise to a claim for damages

both in delict and in contract. Put differently, the same conduct of the

defendant may constitute both a breach of contract and a delict, viz. an

infringement of the plaintiff’s rights ex contractu and a right which he had

independently of the contract. In such a case, the plaintiff is allowed to

choose which remedy he wishes to pursue.

      In this regard, Adv. Mpofu submits that the plaintiff has specifically

pleaded a duty of care. If the allegations relating to contract are excised

from the Declaration, it would remain good on the basis of the remaining

allegations founded upon Aquilian liability, which are independent from

the contract between the parties. In any event, he goes further to

contend that the South African authorities were emphatically rejected in J.

Paar & Company (Pvt) Ltd v Fawcett Security Organisation (Bulawayo) (Pvt)

Ltd 1986 (2) ZLR 255 (S) at 265-266. He is clearly incorrect in that

contention. Although the Supreme Court did consider and decline to

follow the Lillicrap case, it did so because the facts before it were

distinguishable from those in Lillicrap. It certainly did not overrule or

reject the principles elaborated in that case. On the contrary, the Court’s

approval of the views expressed by Professor Boberg, in the South African

Law Journal (1985) 214, at pp. 217-218, is perfectly concordant with the

position taken in the Lillicrap and Holtzhausen’s cases vis-à-vis the possible

concurrence of actions both in contract and in delict. Indeed, the

examples cited by Professor Boberg graphically illustrate the point that

the claim in delict must found an independent cause of action from that
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grounded in contract. I fully subscribe to his broad statement of the

proposition that “the law of delict does not prescribe what must be done;

it prescribes how something must be done if the actor decides to do it.”

       Turning to the instant case, the claim in paragraph 11.1 of the

Declaration is essentially the same as the claim in paragraph 9.1 and is

therefore defective in that regard. However, what is pleaded in the

remainder of paragraph 11, pertaining to the theft of the tobacco bales,

is materially different and arises independently from the contractual

causa pleaded in paragraph 9. In my view, the negligence alleged by the

plaintiff goes beyond the mere malperformance of the 1 st defendant’s

contractual obligations. It follows that the 1 st defendant’s exception must

also fail with respect to the plaintiff’s claim in delict.


The Exception Procedure

       Given the foregoing conclusions, it is not necessary for me to

determine the additional arguments put forward by counsel as to the

procedure by way of exception. However, for the sake of completeness, it

may be pertinent to remark on one of the larger issues raised herein.

       It is trite that the procedure for excepting is to be employed for

“those objections which go to the root of the declaration and allege that

the declaration does not disclose a cause of action at all.” See Edwards v

Woodnutt N.O. 1968 (4) SA 184 (R) at 186. What is arguable is whether it is

permissible to allow an amendment to the declaration to cure this defect.

The decision in Boyd v Minister of Justice Legal and Parliamentary Affairs

1990 (2) ZLR 364 (H) at 368, is to the effect that such amendment is not

desirable because it defeats the very purpose of exception proceedings.

As against this is the more flexible approach adopted in Levenstein v

Levenstein 1955 (3) SA 615 (SR) at 619, and in Adler v Elliot 1988 (2) ZLR 283
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(S) at 292. In the latter case, the Supreme Court observed that a claim

“should not be dismissed on an exception where it is possible that the

party affected may be able to allege further facts that would disclose a

cause of action”. In such instances, the party should be given leave to

amend and the claim should be determined on the basis of evidence lead

at the trial.

         Mrs. Matsika submits that these cases are distinguishable because

they deal with exceptions to vague and embarrassing pleadings. They

must, therefore, be confined to such exceptions and not be extended to

pleadings which do not disclose any cause of action. While I agree that

leave to amend pleadings should not be granted willy-nilly, I do not think

that the authorities cited can be construed to exclude the possibility of

amendment in appropriate circumstances, even where no cause of action

is disclosed. It seems to me that each case must be considered on the

facts peculiar to it and having regard to the conduct of the parties in

relation to the proceedings generally.

         As regards costs, I take the view that the exception in casu was not

entirely unarguable and raised certain points of appreciable procedural

importance. The disposition of costs should therefore be determined in

fine. The exception is accordingly dismissed, with costs being in the

cause.



Atherstone & Cook, plaintiff’s legal practitioners
Wintertons, 1st defendant’s legal practitioners
Coghlan Welsh & Guest, 2nd defendant’s legal practitioners