Masons Travel (Pty) Ltd v Seychells Hotel Ltd (SCA 35 of 1994) [1995] SCCA 17 (8 November 1995)

IN THE SEYCHELLES COURT OF APPEAL MASON'S TRAVEL (PTY) LTD APPELLANT ,20 V. SEYCHELLES HOTEL LIMITED Civil Appeal No. 35 of 1994 Mr. B. Geor g es for the Appellant Mr. J. Renaud for the Respondent JUDGMENT OF GOBURBHUN, P., AND AYOOLAL_J. A. In this appeal from the decision of Perera, J. made on 1994 whereby he entered judgment for Seychelles (now "the respondent") against Mason's Travel (now "the appellant") in the sum of R.1,024,945 interest, three grounds of appeal have been 5th December Hotel Ltd. (Pty) Ltd. together raised in the memorandum of appeal as follows: with The learned Trial Judge erred in ignoring the agreement dated 24th October 1990 between TFC Tours South Africa and Seychelles Hotels and erred in not considering the importance of that agreement to the issue in dispute." The learned trial Judge erred in not considering confirmation voucher in the light of the main agreement between TFC tours and Seychelles Hotels. the "3. The learned Trial Judge erred in not, seeing that the confirmation voucher was simply that - a voucher confirming what had already been agreed - and could not be or become a subsidiary agreement standing alone." the only on behalf However, counsel confirmation linked to appellant must be regarded as an agent. submitted for determination by appellant is whether the the voucher mentioned in the memorandum of appeal if agreement does not imply that the issue of the main A convenient starting point of the statement of the background facts is the pleadings of the parties wherein the facts are admitted facts and thus common ground. following The respondent (then described as plaintiff) was a parastatal the tourist industry managing certain hotels in company in while the appellant (then described as defendant) Seychelles, was a tour operator. By virtue of an agreement made in 1988 between the parties, the appellant was to organise tourists from South Africa to stay in the respondent's hotels. Among the terms of the said agreement, the appellant was to be billed for payment and to receive a commission if a certain amount of tourists was obtained at a certain period. The appellant until July 1991 had been regularly paying the said bills and receiving the said commissions on reaching the said agreed amount of tourists. Since the date mentioned above, the appellant had declined to pay bills incurred at the respondent's hotels totalling R.1,024,945 contending that they were not responsible as they only acted as agent for a principal in South Africa. The above paragraphs 1-5 of by the respondent in facts the plaint were admitted by the appellant in paragraphs 1, 2, 3 and 5 of the statement of defence. The appellant which pleaded that it acted as agent for a pleaded in and better particulars of South African Company for limited purposes only further averred the further its defence that it entered into agreement with the statement of respondent "for Messrs TFC Tours South Africa" for whom it was "acting merely as agent ... for the sole purposes of and executing a contract, and of paying sums due negotiating by TFC Tours to the Plaintiff when remittances were received from the said TFC Tours." useful The facts which influenced the decision of Perera, and form a appeal are facts briefly stated are that the company known as TFC Tours, whose agent the appellant claimed to be, was a tour operator outside the pleadings of the parties. J. to the issue raised on this Those background Tourists emanating from TFC Tours based in South Africa. TFC for a package tour in Seychelles arrive in after paying Seychelles bringing with them a voucher containing all the This voucher is exchanged at services the Seychelles Airport by Masons for a voucher entitled "confirmation voucher" addressed to the particular hotel needed in Seychelles. -3- concerned with whom there would have been a room allocation agreement and containing the following: "Please provide the following services for Passenger's Name Tour Operator: TFC Tours (Pty) Ltd. Country: Rep. of South Africa to Date From Date Total Rooms Room Type Meal Plan Payment - Masons. were accommodated in the In regard to this case, TFC tourists holding confirmation respondent's hotels. vouchers for services rendered by the respondent is Payment procedure summarised by Mr. Georges, counsel for the appellant, thus: "Seychelles Hotel would in due course send invoices for payment for services rendered to the TFC Tours clients to Mason would gross up that invoice ... send Mason's Travel. to TFC, TFC would remit money to Mason's. that new its part and pay TFC its part." Mason's in 1991 TFC had some Apparently this difficulty and was unable to remit money to Mason's Travel in keep case arose because invoice would by the respondent. respect of guests described by Mason's as TFC guests who have The respondent having been accommodated not received payment for the services rendered in regard to The those payment from at the trial and on this appeal is whether there is question basis for the alleged liability of the appellant. guests claimed the appellant. If the matter were to be resolved on the contents of the pleadings, it is manifest that the respondent's averment that the room allocation contract (Exhibit P1) made sometime in 1988 between Mason's Travel and Seychelles Hotels Ltd. was the contract on which the appellant's liability was founded, -4- obviously would not have taken the respondent's case very far because nowhere in the plaint was it averred that the appellant lodged tourists in the respondent's hotels pursuant to that agreement and that the debt now claimed was thereby incurred. There is another set of contract (Exhibit D3) made between "Masons Travel/For Messrs TFC Tours South Africa" and Seychelles Hotel Ltd. covering the period "from 18/12/90 to 16/12/91". The appellant contended, though the pleaded, fact was not tourists lodged in the respondent's hotels pursuant to that contract. that the claim arose as a result of Perera J. did not find any material difference in the and the 1990 agreement (Exh. D3) for 1988 agreement (Exh. P1I he said: by although exhibit D3, the contracted as: for TFC:, the defendant had nature of the transaction tends to indicate that what was done by that document was to source of the clients of the indicate the defendant for accounting purposes and implication, later expressly, he regarded the By agreements. appellant as However, he did not regard either of the agreements as determining the mode of payment. a principal contractor in both He said: the annual agreements were as regards room allocations, rates, commissions etc. and not regarding the mode of payments." He then observed that: "Payment was made by (sic: to) the hotel to (sic: by) Masons throughout on the basis of the confirmation voucher." After adverting to the judgment of this court in Masons Travel (Pty) Ltd. v. Beau Vallon Properties Ltd. CA No. 8 -5- of 1993 (2nd August 1994) Perera, J. determined the case on the basis of obligation which he held arose from the confirmation vouchers. He said: on who the basis offered the services arrangement Masons had at that time "Whatever with TFC regarding payment would not bind the to the plaintiff and clients for assumption unequivocal payment in the confirmation voucher. In the the defendant is liable to pay circumstances of the plaintiff in the unpaid the given in terms confirmation vouchers." hotel bills the of the of undertaking liablity clear of he based the appellant's liability. Although Perera, J. regarded the appellant as contracting as a principal in the room allocation agreement, in the end it was on the undertaking contained in the confirmation vouchers It is, of course, that evident that if the appellant had contracted as principal by the room allocation pay for agreement the services requested will be pursuant to the agreement and the merely serve as evidence of confirmation vouchers would acceptance of the offer of rooms. is if the room allocation agreement has been found to be between TFC and the respondent that the question would arise whether and on what assumes liability by issuing the explains why the plead the confiration vouchers as source basis confirmation respondent did not of the appellant's obligation to pay. appellant vouchers. obligation to This perhaps the It allocation agreement to tour operators for specifies among other It is expedient to consider the nature of the room whereby the respondent allocates rooms a specified period. That agreement things the number of rooms allocated, and the payment the duration of such night include terms as deposit/guarantee. view a firm offer of those rooms to the tour operator on the allocation, the rates per person per Other terms and conditions rooms and of release The room allocation agreement is in our terms. to cancellation, -6- terms contained in the agreement. There is also implied in offer to keep that firm offer open for the it a collateral period of the allocation subject to terms as to withdrawal of When the allocation and release of the rooms to the hotel. the tour operator accepts the collateral offer, the room allocation agreement becomes, at least, a unilateral contract which the tour operator can enforce. The room allocation agreement duties only in the hotel proprietor to make the rooms the type embodied in exhibits P1 and D3 creates of available if and when requested on terms already specified. The confirmation voucher of the type put in evidence serves Mason's" a dual purpose only because of the two in this case words "Payment" Without those words, the confirmation voucher when issued pursuant to the room allocation agreement would merely serve as an acceptance of the firm offer of a room on terms contained in the room allocation agreement. which it contains. party to whom it has An offer made to a party cannot be a not been made. venture to think that an offer made to A as an him in his own right as a accepted Similarly, we by a g ent cannot be accepted by principal. conclusion Ayoola, J. A.) that: It is in Beau Vallon Properties this consideration that influenced the (per (supra) case transaction "The confirmation obligations provide accommodation the room allocation contract." voucher assumed resulting the is intertwined with the respondent to requested, in by when from the so The result of all this is that if the room allocation the offer accepted is between TFC and Seychelles Hotel Ltd., Mason's agreement therein by issuing the could not have confirmation voucher as principal. To the extent that the confirmation voucher is an acceptance of the offer contained in the room allocation agreement the contract and therefore and obligations ensuing from such acceptance must the rights be of the parties to the room allocation contract. That the vouchers not only appeared to have emanated from confirmation -7- Masons as an unequivocal request from it to the Hotels but also contained a clear undertaking to pay for the services requested strengthens in our view, the conclusion that the appellant must have contracted as a principal in making the room allocation agreement. In the Beau Vallon Properties case, this court was unanimous in the view that the statement of 'Payment: Masons' in the confirmation vouchers such as those in this case constitutes an assumption of liability by Mason's to pay. This court held per Goburdhun, P. that: whatever capacity Mason's was acting (the "In confirmation voucher) guarantees payment by Mason's." It was held per Ayoola, T. A. in that case that the statement "Payment: Mason's" is a statement of assumption of liability while Venchard J. A also held the view that the voucher as couched clearly "constituted a subsidiary contract under which the Appellant (Mason's) renders him exclusively liable to the Respondent." As to the practice in the trade, there is given by Mr. Fogette, a witness for the appellant, that the hotel would expect to be paid by Masons Travel for the voucher it issued. evidence It is not inconceivable that a person having accepted an offer as an agent of a contracting principal also super imposes on the contract a collateral obligation of his own to discharge the principal's obligation under the contract. Where the other party to the contract agrees to that arrangement the agent becomes a promisor in his own right. This, in essence, is the "subsidiary contract" referred to by Venchard, J. A. in the Beau Vallon Properties Case. For these reasons we are of the view that none of the Ground 1 three grounds of appeal canvassed can succeed. appears to be misconceived in that the learned trial Judge • -8- did not ignore the 1990 agreement but rather came to the conclusion that it did not alter in any material manner the 1988 agreement in re g ard to the parties to the contract. Ground 2 is based on a false promise since the learned Judge did not find that the "main agreement" was between TFC Tours and Seychelles Hotel. reasons which have alread y been amplified in this judgment, to Ground 3, for the In regard although the confirmation voucher as a document of acceptance of a standing firm offer contained in the room allocation agreement super-imposed could not stand alone, the appellant had a collateral obligation undertaken by itself to pay for the services rendered pursuant to the room allocation agreement by ""Payment: Mason's" in the voucher, even if it is assumed that the agreement was between TFC and the respondent. inserting In the result, valiant and brilliant as the efforts made by counsel on behalf of the appellant had been to upset the judgment of Perera, J. we must come to the conclusion that this We would accordingly dismiss the appeal with costs to the respondent to be assessed. appeal should be dismissed. Dated this day of October, 1995. tsz_s_r , H. GOBURDHUN (PRESIDENT) timitatictiu E. O. AYOOLA (JUSTICE OF APPEAL) ektk (4-C-4 a Jit v c.1 /tAy—i4e*- ., A C•m•.3