BMC wins against feedlot company
Goitsemodimo Kaelo | Tuesday August 1, 2017 16:36
The company also failed in its bid to overturn the Francistown High Court judgement, which ordered it to repay the P650,000 advance loan it received from BMC on December 24, 2010.
The appeal followed an application by Northern Ranching at the High Court in which it claimed damages of P7,720,934 representing profit it would allegedly have made if BMC complied with its obligations under their contract.
The two parties had entered into a written agreement on December 23, 2010 in which BMC was from time to time to deliver cattle to Northern Ranching for feeding purposes, for which the latter would then receive an agreed fee.
Its claims, which the Francistown High Court dismissed, relied on the premise that BMC had not delivered any cattle to the appellant pursuant to the agreement. Northern Ranching, then appealed the judgement. However, the bench of the Court of Appeal (CoA) made up of justices Ian Kirby, Monametsi Gaongalelwe and Brand J.A upheld the High Court judgement and dismissed the appeal with costs.
In a judgement handed down on Friday by Justice Brand, the CoA justices agreed with the trial court that in a proper interpretation of the contract between the parties, BMC was under no obligation to deliver any cattle to the appellant.
“In addition, I find that the doctrine of quasi-mutual assent makes no difference to this conclusion. But I do not believe this line of argument can be seriously entertained. In fact, I find it fundamentally flawed. The fundamental flaw lies in the fact that the application of the doctrine quasi mutual assent is wholly inappropriate on the facts of this case,” said Brand in the judgement.
The justices found it unnecessary to even consider the respondent’s alternative defence that, if it were obliged to deliver cattle, performance of that obligation was rendered impossible, inter alia by the outbreak of foot and mouth disease, first in Zambia and South Africa and then in the Francistown area. Brand said the appellant did not come close to proving the quantum of its alleged damages.
Meanwhile, the appellant also failed in its bid to overturn judgement to repay back the P650,000 loan it received from BMC, which was for purposes of purchasing enough cattle feed for the initial 45 days of the first 1,000 cattle delivered to the feedlot.
The CoA bench pointed out that the contract between the parties provided that unless extinguished by set-off, the loan would be repayable by the end of contract after three years.
“In this circumstance, the contention that repayment is not due because it was not used for feeding, is clearly without merit,” Brand said. Northern Ranching had argued that since the loan was made for the feeding of respondent’s cattle, which was never delivered, it was and is impossible for it to comply with the provisions of the contract and should be discharged from liability.
However, the justices felt that defence could only be relied upon where performance of the obligation under consideration became objectively impossible by virtue of supervening impossibility.
They pointed out that the defence lacks merit because the way in which it is formulated appears to assume that the obligation under consideration is to feed the cattle.
“But that is not so. The obligation under consideration is to repay the loan and I can think of no reason why the non-delivery of cattle would render it objectively impossible for appellant to repay the loan.”