KL Construction (Pty) Ltd V the Minister of Works and Transport (I 246-2013) 2015 NAHCMD

REPUBLIC OF NAMIBIA

HIGH COURT OF NAMIBIA MAIN DIVISION, WINDHOEK

RULING

In the matter between:

Case no: I 246/2013

K L CONSTRUCTION (PTY) LTD PLAINTIFF

and

THE MINISTER OF WORKS AND TRANSPORT DEFENDANT

Neutral citation: KL Construction (Pty) Ltd v The Minister of Works and Transport (I 246/2013) [2015] NAHCMD 71 (25 March 2015)

CORAM: MASUKU A.J.

Heard: 2-3 March 2015

Delivered: 25 March 2015

Flynote: an application for amendment of the replication was moved by the plaintiff just before commencement trial. The application was not opposed. The court revisited the main rules applicable to amendments and held that even if an application for amendment is not opposed the court should still exercise judicial oversight. The court found that the application for amendment redounded to clarity and further aligned the pleadings (replication) to the evidence proposed to be led. The application was granted and the plaintiff was ordered to pay the wasted costs which it had tendered.

RULING ON APPLICATION FOR AMENDMENT

MASUKU, AJ.:

1.  On 3 March, having listened to argument, I issued the following order:

(a). The application for the amendment of the plaintiff’s replication is hereby granted.

(b) The defendant is hereby ordered, if so minded, to file its rejoinder within eight (8) days from the date hereof;

(c) The matter is postponed to 25 March, 2015 for a status hearing, at 15h15;

(d) The plaintiff, as tendered, is hereby ordered to pay the wasted costs occasioned by the postponement.

(e) Reasons for the above order will be issued in due course.

Following below are the reasons referred to in (e) immediately above.

2.  The plaintiff, a company duly registered in accordance with the Company Laws of Namibia was on 15 December, 2011, in writing awarded a contract by the Namibian Government. The Government was represented by the Ministry of Works and Transport and the contract was in relation to erecting new border facilities at Ariamsvlei, Namibia. For reasons which are not material for present purposes, it would appear that the plaintiff was unable to commence the works and accordingly filed a claim against the defendant for payment of an amount of N$ 2 606 765, 52 being an amount for costs and damages incurred as a result of the works not proceeding. There is also filed an alternative claim and other consequential relief which I do not find it necessary to mention at the present moment.

3.  In its particulars of claim, the plaintiff alleged that an attempt to hand over the site to it failed as a result of an objection that was raised over ownership of the property and the engineer instructed by the defendant, ordered the plaintiff to suspend the works, which it did. It subsequently filed its claim for interim payment which was paid, albeit late. The plaintiff thereafter made a written request to be allowed to proceed with the works but the defendant indicated that it could not hand over the site due to a dispute over the ownership of the property where the works were due to be undertaken.

4.  The plaintiff alleges that it then gave notice to the engineer that it accepted the defendant’s repudiation in terms of the contract and claimed return of the performance guarantee, which was eventually returned in October 2012. It also filed a claim with the engineer for payment of the amount claimed in terms of the contract and the payment was certified by the engineer and not disputed by the defendant. It is that amount that the plaintiff claims from the defendant in these proceedings.

5.  The plaintiff further averred that the defendant then called for fresh tenders for the same project without reference to it and subsequently assigned the work to another contractor in breach of the written contract. This the plaintiff claims, was a breach of the contract inter partes and entitled it to damages for breach of contract. It also claimed the same amount referred to above as loss of profit as a consequence of the defendant’s breach of the contract.

6.  In its plea, the defendant essentially denied that the site was not handed over to the plaintiff and further denied that the written request to continue with the works filed by the plaintiff complied with the written terms of the agreement and is therefore invalid. The defendant further pleaded that the cancellation of the contract by the plaintiff on the alleged breach of same by the defendant was invalid for the reason that it did not comply with the terms of the written contract. The defendant therefore claims that it is not liable to the plaintiff in the amounts claimed or at all.

7.  In its replication, the plaintiff raised issues of waiver, contending that that the defendant, at the time of delivery of the various notices which are claimed not to have been in compliance with the written contract did not object thereto and thereby waived its right to object to the said notices. The plaintiff further raised the issue estoppel as an alternative in terms of which it claimed that the defendant presented the engineer as its agent and could not belatedly attempt to repudiate the said engineer’s agency as not having been the person it had appointed to represent it in the dealings with the plaintiff relating to that project. It further averred that neither the defendant nor the engineer objected to the any of the relevant notices when they were issued by the plaintiff and they were thus estopped from denying their validity.

8.  The matter went through all the management conference stages, including the pre-trial stage. The trial date was allocated and the matter was duly set down for trial from 2 to 6 March 2015. When the matter was called in court on 2 March Mr. Maasdorp, learned Counsel for the plaintiff filed a notice of application for leave to amend its replication. This notice was accompanied by an amended replication in case the application for leave to amend was not opposed and therefore granted by the court. I must mention that these documents bear the Court stamp and show that they were filed at 09h50 when the trial was due to commence at 10h00.

9.  The first time the court got to know of the amendment was when the matter was called. In order to consider the said amendment and to allow the defendant to consider same, I stood the matter down for a short period. When the court resumed after the brief adjournment, I drew the attention of the parties to a judgment of this court in Scania Finance Southern Africa (Pty) Ltd v Aggressive Transport and Another[1]. I requested counsel on both sides to consider the said judgment and to make submissions on its implications on the application for amendment then serving before court. By the consent of the parties, the matter was further stood down to 2h15 to enable full argument thereon to be made.

10.  When the matter was recalled, Mr. Maasdorp introduced an affidavit deposed to by himself and in which he set out to explain the reasons for seeking the amendment and at so late a stage when the trial was due to commence. He reasoned in his affidavit that the application for amendment prayed for was limited in scope and was aimed at aligning the pleadings to the evidence proposed to be led and no more.

11.  In particular, he pointed out that it dawned on him during preparation for the trial, after consulting the authorities closely on the defences mounted by the defendants that there were certain necessary averrals (negligence) he had not included in the replication. This was particularly in response to the defence of estoppel. The second reason for the proposed amendment, he further contended, was to clarify the correct nuance to be attached to the word “valid” in the replication so as to bring all the parties and the court to sing from the same hymn book as it were. I should mention that the plaintiff’s counsel pointed out that the plaintiff was tendering costs occasioned by the postponement necessitated by the application if the court was inclined to grant same.

12.  The defendant’s counsel indicated that after taking instructions, they were not opposed to the amendment and were content with the amendment being allowed subject to the defendant being allowed to plead to the said amendment, if so advised and more importantly, subject also to a balming order as it were, in relation to wasted costs.

13.  I took the position that applications for the amendment of pleadings, particularly those initiated immediately before the commencement of trial, cannot be granted merely for the asking. I also formed the view that the court is not necessarily bound to allow an amendment only on the basis that the parties are in agreement that the application ought to be allowed. I am of the opinion that there are greater and wider interests of the administration of justice to granting amendments and the deleterious effect they potentially have on the finalization of cases than the immediate interests of the parties. I persist in that view.

14.  It is well to remember that to allow the parties to dictate on such matters and bind the court on agreements to amend would be tantamount to reverting to the pre-judicial case management era, where the parties drove the vehicle as it were and were in control of the pace of litigation, with the judge occupying the back seat as it were, to a large extent, at the mercy of the “drivers”. It is accordingly my firm view that even when the parties agree to an amendment, the court should employ judicial oversight and be able to bring its judgment to bear and particularly to balance all the relevant interests and bring them to some equilibrium, based on the facts of the attendant matter.

15.  I therefore required of the parties to make full argument on the application notwithstanding the non-opposition in order to ensure that not only was the amendment called for in so far as the parties are concerned but also that its grant is consistent with the wider dictates of the administration of justice and also falls in line with the judicial policy on amendments that was authoritatively declared in the Full Bench case brought to the court’s attention by Mr. Maasdorp. This is the case of I A Bell Equipment Company (Namibia) (Pty) Ltd v Roadstone Quarries CC[2]. The application was thus adjourned to the following day (i.e. 3 March) for argument. I shall have regard to the said judgment below.

The judicial policy to amendment of pleadings

16.  In view of the importance the issue of amendment of pleadings assumed and the impact it might have had on the success or otherwise of judicial case management, the Damaseb J.P., in his wisdom empanelled a Full Bench of the High Court to streamline the proper judicial approach to amendments in the post J.C.M. era in this jurisdiction. The process of analyzing the relevant law and practice in the judgment, however started before the said era, with the court painting the route of the amendment of pleadings from the common law, the pre-J.C.M. era to the J.C.M. epoch. I will avoid engaging in an exercise of supererogation and only highlight the main conclusions on the proper approach and in so far as these may have a bearing on the instant case. I should mention at the outset that the Full Bench considered all the important cases then delivered, that had a bearing on the question, both at the Supreme Court and the High Court levels. A fairly comprehensive review of the Canadian case law on this subject was also undertaken for purposes of comparison.

17.  Some of the main conclusions were the following:

(a) ‘amendments may be brought at any stage of the proceedings[3]

(b) the court exercises a judicial discretion in allowing or disallowing amendments, and which discretion must be exercised judicially[4];

(b) a litigant seeking an amendment is craving the indulgence of the court and therefore must offer some explanation for the amendment sought[5];

(c) the explanation required for seeking the amendment will be determined by the nature of the amendment sought. The more substantial the amendment, the more compelling the case for an explanation[6];

(d) if a party provides an explanation that is not reasonably satisfactory or is lacking in bona fides, the court may disallow the amendment, especially if it is opposed and has the potential to compromise a firm trial date

(e) an amendment that is not opposed or one that is minor will invariably be granted[7];

(f) the more substantial an amendment, the more compelling the case for an explanation under oath[8]

(g) a reasonably satisfactory explanation for a proposed amendment is strongest when where it is brought late in proceedings or where it involves a change in front or withdrawal of a material admission[9]

(h) If the proposed amendment is justified on the ground that it arose from a mistake, the mistake relied on must be bona fide and will only be allowed if good grounds exist for allowing the amendment[10];

(i) a court cannot compel a party to stick to a version either of fact or law that it says it no longer represents its stance and this is because litigants must be allowed in the adversarial system to ventilate what it believes are the real issues between them[11];

(j) the imperative of speedy and inexpensive justice may, in appropriate cases, justify the denial of an amendment if it was necessitated by poor preparation or lack of diligence on the part of the practitioner which will have the effect of frustrating the early disposal of the case and therefore the administration of justice;[12]