THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

REPORTABLE

Case No: 359/2013
In the matter between:

AFRICAST (PTY) LIMITED
APPELLANT

and

PANGBOURNE PROPERTIES LIMITED
RESPONDENT

Neutral citation:
Africast v Pangbourne Properties (359/13) [2014] ZASCA 33
(28 March 2014)
Coram:
Lewis, Mhlantla, Bosielo and Theron JJA and Mathopo AJA
Heard:
18 February 2014
Delivered:
28 March 2014
Summary:
Where a suspensive condition is not fulfilled timeously it lapses and
the parties are not bound by it even though one has performed
fully.

ORDER

On appeal from: South Gauteng High Court, Johannesburg (Sutherland J sitting as
court of first instance):

The appeal is dismissed with costs.

JUDGMENT

Lewis JA (dissenting):

[1] The respondent, Pangbourne Properties Ltd (Pangbourne), is a public
company listed on the Johannesburg Stock Exchange. Its principal business is the
acquisition and letting of commercial and industrial premises. The appellant, Africast
(Pty) Ltd (Africast), is a company within a group that undertakes property investment
and development. In late 2006 and for the first two months of 2007 the parties
negotiated about the development of commercial property in Sunninghill,
Johannesburg, which they designated ‘The District’. Their representatives agreed on
the terms of a contract for the building of commercial premises by Africast; for the
letting of those premises to tenants and for the cession of the rights under the leases
to Pangbourne, which was obliged to pay the purchase price for the improved
properties to Africast only on transfer of the properties and cession of the leases.
[2] At issue in this appeal is the question whether the contract lapsed because of
the non-fulfilment of a suspensive condition. The condition was that Pangbourne give
written notice of the approval by its board of directors, within seven working days of
the conclusion of the contract. The question in turn depends on the construction of
the provision embodying the suspensive condition.

[3] It is common cause that Pangbourne, some 18 months after the signing of the
agreement, decided that the condition had not been fulfilled within the stipulated
period, and that it was accordingly not bound by the contract. It refused to furnish
bank guarantees in respect of the fulfilment of its payment obligation to Africast. At
that stage the buildings had been constructed in accordance with the contract. And
Pangbourne’s employees had been involved on a regular basis with the whole
development.
[4] Africast regarded Pangbourne’s decision as a repudiation of the contract: it
accordingly cancelled and sued for damages for breach of contract. The South
Gauteng High Court (Sutherland J) held that the condition had not been fulfilled
timeously; that Pangbourne was not bound by the contract and that Africast was
accordingly not entitled to damages. The question of damages was not traversed in
the high court since it had ordered, at the request of the parties (and in terms of Rule
33(4) of the Uniform Rules of Court), that the question of the enforceability of the
contract, and the measure of damages be determined separately from the
quantification of damages. However, it declined to deal with the appropriate measure
of damages, quite understandably in view of its finding that Pangbourne was not
bound by the contract in the first place. Africast appeals to this court with the leave of
the high court.
[5] Some factual background is necessary before the provision in question, and
the high court’s finding, are discussed. The negotiations between the parties
culminated in a written document signed on 5 March 2007 by Pangbourne’s group
company secretary, Mr J J Groenewald, and a director, Mr Kennedy. They also
signed an addendum to the contract, including, inter alia, further suspensive
conditions (all of which were fulfilled), on 11 April 2007. Mr J Weaver, Africast’s
representative, signed both the agreement and the addendum on 11 April.
Groenewald and Kennedy did not actually have the authority to bind Pangbourne to
any contract, a fact not in dispute. For the conclusion of any contract in respect of
which a sum in excess of R50 million was payable, Pangbourne board approval was
necessary. And for a contract sum that was less than R50 million, only the chief
executive officer of Pangbourne had authority to bind the company, and then only
with the approval of the investment committee.

[6] The provision at issue, clause 16.1, of the signed document read:
‘This agreement is subject to the suspensive condition (stipulated for the benefit of
Pangbourne Company and which may be waived by written notice given by Pangbourne
Company to the Seller Company [Africast] on or before the date for fulfillment of this
condition) that within 7 days (excluding Saturday, Sundays and public holidays) after the
date on which this agreement is concluded (or such other period/s as the parties may agree
to in writing from time to time) Pangbourne Company gives Seller Company written notice
that its board of directors has approved the purchase of the property by Pangbourne
Company in terms of this agreement. This condition is not capable of fictional fulfillment.’ (My
emphasis.)
[7] On Friday 20 April 2007 Pangbourne’s board of directors signed a written
resolution approving the acquisition of the property from Africast and an agreement
with Africast to construct an office park, the total ‘purchase consideration’ being
some R66 698 792, payable on completion of the development. The resolution also
authorized any two directors or a director and the company secretary to sign the
‘Property Sale Agreement, which includes the Development Agreement’.
[8] Thus seven business days after the signing of the agreement the Pangbourne
board approved the contract that had been signed by Groenewald and Kennedy on
its behalf. The following Monday, 23 April, a firm of attorneys acting for Pangbourne
lodged an intermediate business merger notice relating to the development with the
Competition Commission.
[9] On the same day, 23 April 2007, Mr B Logan, a partner of Africast in the
development of The District, sent an email to an employee of Pangbourne, Mr A
Joannides, about another matter, but asked: ‘How is your board approval looking for
The District?’ Joannides replied: ‘Although I don’t have confirmation, I believe it was
approved.’ And on 25 April 2007, another employee of Pangbourne, Mr R de Villiers,
sent an email with the board resolution attached to it to Logan, stating ‘Herewith
Pangbourne Board approval as requested’.
[10] The question that arises is whether the communication of the fact of board
approval – the condition that had to be fulfilled – was timeous: did it occur within
seven business days of the conclusion of the contract? Africast argued both in the
high court and on appeal that the contract was concluded only when the Pangbourne

board approved the contract on 20 April 2007. The condition was thus fulfilled within
seven business days when De Villiers advised Africast on 25 April that the board had
approved the contract and sent a copy of the board resolution to it.
[11] Pangbourne argued, on the other hand, that the contract was concluded on
11 April 2007 when the contract was signed by representatives of Pangbourne and
Africast.  Accordingly, it contended, the condition had not been fulfilled timeously and
the contract had lapsed before 25 April when written notification of the board
approval was sent to Africast.
[12] Sutherland J in the high court found that ‘conclude’ in clause 16.1 bore its
ordinary meaning – to reach finality – and that the contract was thus concluded when
the parties’ representatives had agreed on the terms and signed it on 11 April 2007.
The learned judge considered that this was not only the intrinsic meaning of the
word, but that, if read in the context of the provision as a whole, any other meaning
would be illogical: how can one suspend an agreement that ‘has yet to be
concluded?’ he asked.
[13] The high court accordingly found that the contract had lapsed by the time that
Pangbourne notified Africast that its board had approved the conclusion of the
contract. It also rejected Africast’s arguments that Pangbourne had waived the right
to fulfillment of the condition, or that Pangbourne was estopped from asserting that it
was not relying on the non-fulfillment of the condition. Africast’s claim for damages
for breach of contract was thus dismissed.
[14] Africast’s principal argument on appeal is that the high court’s interpretation of
clause 16.1 of the agreement was wrong. It argues in the alternative that
Pangbourne is estopped from asserting that the contract is not binding because, by
its conduct over a lengthy period, it misrepresented that it regarded the contract as
having been concluded on 20 April, when the board approved the resolution. An
alternative argument on estoppel is that Pangbourne’s conduct amounted to a
representation that it would not rely on non-fulfillment of the suspensive condition.
[15] I shall deal first with the interpretation of the meaning of the word ‘conclude’ in
clause 16.1 and the construction of the provision as a whole since I consider these
dispositive of the appeal. It is trite that in interpreting a provision of a contract a court

must have regard to the contract as a whole, starting with the words used. But a
court must also examine those words in the context in which they were used, taking
into account the factual matrix. (See KPMG Chartered Accountants (SA) v Securefin
Ltd 2009 (4) SA 399 (SCA) para 39, followed in Natal Joint Municipal Pension Fund
v Endumeni Municipality 2012 (4) SA 593 (SCA).)
[16] Much evidence was led by Africast in an attempt to shed light on what the
parties had intended when agreeing on the wording of clause 16.1. The chief
witnesses for Africast were Groenewald and Hutchison, formerly the company
secretary and a director and chief executive officer of Pangbourne respectively. It
transpired during the course of their evidence that the management of the company
had changed during 2008 and that was when Pangbourne had decided to treat the
contract as having lapsed. Groenewald and Hutchison had left the company when
the new management stepped in. So had all the directors who had been in office in
April 2007. Logan and Weaver from Africast testified as well. Of course all of their
views of what the contract meant were inadmissible and irrelevant. But significantly
all agreed that from the date when the board had approved the contract until well into
2008, they had worked on the assumption that the contract was binding. And the
objective evidence bears that out. I shall not traverse it since it was clear from both
parties’ conduct that the obligations under the contract were performed until
guarantees for payment of the price by Pangbourne were required by Africast.
[17] The high court held that the contract became binding – but subject to the
suspensive condition – when it was signed by the representatives of the parties. One
cannot speak of a contract subject to a suspensive condition as becoming binding
only on the fulfillment of the condition, said the court. Africast’s argument on appeal
is, however, that the condition – the happening of an uncertain future event – was
not the approval of Pangbourne’s board itself. It was instead the giving of written
notice of the fact of the approval. Until the board did approve the contract it was not
concluded: it had not reached finality. The signature of the document by Groenewald
and Kennedy did not give rise to a binding agreement. It could not because they had
no authority to bind Pangbourne. Only the board had that authority.
[18] The uncontradicted evidence of Groenewald was that he had authority to sign
documents on behalf of Pangbourne, but not to bind it to any contract. Only its board

could bind Pangbourne to a contract the cost of which exceeded R50 million. The
same was true of Kennedy. They could thus not have concluded the contract –
brought it to finality – on behalf of Pangbourne. Accordingly, neither Africast nor
Pangbourne was bound by the contract until there was board approval. If the board
did not approve the contract, or before it did, either party could have refused to
comply with it. The board approval on 20 April 2007 resulted, therefore, in the
conclusion of the contract.
[19] What, then, does one make of the condition? Africast argued that the
fulfillment of the condition occurred when written notice of the board approval was
sent by Pangbourne to Africast on 25 April, well within the seven business days of
the conclusion of the contract. And from then on, both parties treated the contract as
binding. That was why, on 23 April (the same day as Joannides of Pangbourne wrote
to Logan stating that he thought the board approval had been given), Pangbourne’s
then attorneys filed a notice of merger with the Competition Commission.
[20] Pangbourne argued that this case was the same as that in Pangbourne
Properties Ltd v Basinview Properties (Pty) Ltd [2011] ZASCA 20 where Pangbourne
escaped a contract that was  conditional on the approval of its board of directors.
The difference between these cases, however, is that in Basinview the Pangbourne
board did not in fact approve the contract. There was no fulfillment of the condition.
[21] Pangbourne argued also that the word ‘concluded’ in clause 16.1 of the
contract had been carefully chosen: the draftsman intended that the conclusion
would be the moment when negotiations between the parties were closed.
Negotiations, it said, are not concluded when a board authorizes a contract. They
are concluded when the parties have reached agreement on the terms of the
contract. The relevant question, however, is when the contract became binding,
subject to the suspensive condition. The high court found, as I have said, that it was
on the signature of the document. But since neither party was bound until there had
been Pangbourne board approval, it would be stretching the ordinary meaning of the
words used to find that all that was intended was that negotiations were concluded,
although the contract would not be binding.
[22] Accordingly I consider that the high court erred in its interpretation of the
provision at issue. The contract was concluded only when the Pangbourne board

approved it on 20 April 2007, and on 25 April, when written notification of the
approval was given to Africast, it ceased to be conditional. This interpretation is
consonant with the contract as a whole and with the conduct of the parties for a
considerable period after conclusion. Africast was thus entitled to cancel the contract
on the basis of Pangbourne’s repudiation, and to claim damages for breach of
contract. The alternative arguments of Africast based on waiver and estoppel thus
fall away.
[23] I have had the benefit of reading the judgment of my learned colleague
Theron JA. I agree with her that from a reading of the pleadings what seemed to be
in dispute was the authority of Groenewald and Kenndey to sign the agreement. But
that was certainly not in dispute at the time of the trial and it was not argued before
us. Neither party submitted in heads of argument or at the hearing that the authority
to sign the contract was an issue. It was clear that they had authority to sign a
contract on behalf of Pangbourne. They even warranted in the agreement that they
had that authority, as Theron JA has said. The real question was whether they could
bind Pangbourne prior to board approval. The high court did not address this issue.
As it saw the matter, the question for decision was whether the reference to
concluding the contract was a reference to signing on behalf of Pangbourne or
binding it, subject to the condition that board approval be given. It held that the acts
of signature amounted to conclusion of the contract. As I have said, the high court
erred. It was not possible for Groenewald and Kennedy to bind Pangbourne, and
therefore to conclude the contract. The contract was concluded only on board
approval even though it had been signed before then.
[24] The high court declined to deal with the measure of damages given, as I have
said, its finding that Pangbourne was not bound by the contract. While the question
of damages was traversed to some extent in the pleadings and the evidence, and
some argument was addressed to this court on whether Africast was entitled only to
the value of The District, or to loss of profit as well, it seems to me that a finding as to
the appropriate measure of damages is inappropriate without also having evidence
as to quantum – a matter that the parties left over for later decision in the event of
Africast being successful in its claim. I consider that since the matter must be
remitted to the high court in any event to determine the quantum of damages, it is
appropriate for it also to consider the measure by which they are to be calculated.

[25] I would have made the following order:
1 The appeal is upheld with costs, including those of senior counsel, and the matter
is remitted to the high court to determine the measure and quantum of damages to
which the appellant is entitled.
2 The order of the high court is replaced with:
‘(a) The contract between the parties is binding.
(b) The defendant repudiated the contract and the plaintiff was entitled to cancel it
and claim damages for breach of contract.
(c) The defendant is liable for the costs of the hearing during February 2012,
including those of senior counsel.’

____________
C H Lewis
Judge of Appeal

Theron JA (Mhlantla and Bosielo JJA and Mathopo AJA concurring)
[26] I have read the judgment of Lewis JA and regret, for the reasons set forth
below, that I am unable to agree therewith.

[27] The facts of this matter are largely common cause. On 5 March 2007, Mr
Groenewald, Pangbourne’s group company secretary, and Mr Kennedy, one of its
directors (the signatories), signed a written property agreement (the agreement) in
terms of which the property forming the subject matter of the agreement was sold to
Pangbourne. On 11 April 2007 they signed an addendum to the agreement. The
representative of Africast, Mr John Weaver, signed the agreement and the
addendum on 11 April 2007.

[28] The agreement contained the following suspensive condition:

‘16.1 This agreement is subject to the suspensive condition (stipulated for the benefit of
PANGBOURNE COMPANY and which may be waived by written notice given by PANGBOURNE
COMPANY to SELLER COMPANY on or before the date for fulfilment of this condition) that within 7
days (excluding Saturdays, Sundays and public holidays) after the date on which this agreement is
concluded … PANGBOURNE COMPANY gives SELLER COMPANY written notice that its board of
directors has approved the purchase of the property by PANGBOURNE COMPANY in terms of this
agreement,… (Emphasis added.)
16.2
If this condition is not fulfilled or waived, then this agreement will terminate and neither party
will have a claim against the other as a result thereof.’
It is important to note that the suspensive condition would be fulfilled not when
Pangbourne’s board of directors approved the agreement, but when Pangbourne
gave Africast written notice that its board had approved the purchase of the property.

[29] On Friday, 20 April 2007, Pangbourne’s board approved the acquisition of the
property, the entering into of a development agreement with a total purchase
consideration of R66 698 792 and authorised two directors or a director and the
company secretary to sign the property sale agreement which included the
development agreement. On 25 April 2007, Pangbourne gave Africast written notice
of the board’s approval.

[30] It was common cause that from 25 April 2007 onwards, the date on which
notification of the board’s approval was sent to Africast, the parties acted on the
basis that the agreement was valid and binding. During 2008, virtually the whole of
Pangbourne’s management was replaced. The new board of directors decided not to
proceed with the agreement and adopted the view that there was no contractual
obligation on it to do so in that the suspensive condition had not been fulfilled.

[31] Africast contended that the contract was concluded on 20 April 2007 when it
was approved by Pangbourne’s board and the notice given on 25 April 2007 was
within the seven day period. Pangbourne, on the other hand, argued that the
agreement was concluded on 11 April 2007 and the suspensive condition ought to
have been fulfilled by 20 April 2007.

[32] It is appropriate to have regard to the pleadings filed by the parties. Africast, in
its particulars of claim, allege that:

‘6A.1 … Although Mr Kennedy and Mr Groenewald signed the agreement and addendum before 20
April 2007, they were not authorised to do so until the defendant’s board of directors had resolved to
proceed with the acquisition of the property. This was only done on 20 April 2007 when the
defendant’s board of directors accepted the recommendation of the investment committee and
resolved to proceed with the acquisition of the property, to enter into a development agreement with
the plaintiff and to authorise persons to sign the property sale agreement.
6A.2 Messrs Kennedy and Groenewald were only authorised to sign the property sale agreement
which includes the development agreement … on 20 April 2007.’

[33] Pangbourne, in its plea, alleged that it had authorised the signatories to sign
the agreement for and on behalf of the company and that the signatories had
warranted, in writing, that they were duly authorised to sign the agreement. It further
recorded that:
‘3A.1 The defendant denies that Messrs Groenewald and Kennedy were not authorised to sign the
said contract and addendum before 20 April 2007.
3A.2 The said persons were duly authorised to sign contracts on behalf of the defendant by the
defendant’s ordinary administrative practices, procedures and customs.
3A.3 The said persons signed the contract and addendum subject thereto that the defendant’s board
of directors would authorise the transaction reflected in the contract and addendum.’

[34] It is clear from the pleadings that the dispute between the parties was whether
the signatories were authorised to sign the agreement. The witnesses who testified
on the question of authority were Groenewald and Hutchison, Pangbourne’s former
chief executive officer. According to Groenewald, he and Kennedy were authorised
to sign the agreement on behalf of Pangbourne.

[35] Groenewald explained that in respect of transactions exceeding R50 million,
approval of the board of directors would usually be sought via a round robin of
emails or faxes, which, if approved, would be converted to a resolution at the next
board of directors’ meeting. This evidence was confirmed by Hutchison who went
further and said that Pangbourne’s board had, prior to 20 April 2007, and in terms of
a round robin resolution, approved the agreement. It is clear from Hutchison’s
evidence that Groenewald and Kennedy had authority to sign an agreement in
respect of which the contract value exceeded R50 million, provided it contained a
suspensive condition such as the one encapsulated in clause 16.1 of the agreement.

[36] The agreement itself points towards the authority of the signatories. In the
agreement and immediately below the signatures of both Groenewald and Kennedy,
the following appears:
‘for PANGBOURNE COMPANY, the signatory warranting that he is duly authorised hereto’

[37] A contract containing a suspensive condition is enforceable immediately upon
its conclusion but some of the obligations are postponed pending fulfilment of the
suspensive condition. If the condition is fulfilled the contract is deemed to have
existed ex tunc. If the condition is not fulfilled, then no contract came into existence.1
Once the condition is fulfilled,
‘[T]he contract and the mutual rights of the parties relate back to, and are deemed to have been in
force from, the date of the agreement and not from the date of the fulfilment of the condition, ie ex
tunc.’2

[38] The case as pleaded by Africast, that the signatories were not authorised to
sign the agreement, does not accord with the evidence of Groenewald and
Hutchison. Based on their evidence, there is no doubt in my mind that the signatories
had authority to sign the agreement in terms of Pangbourne’s internal arrangements.
I agree with the finding of the high court that ‘the notion that Kennedy and
Groenewald acted without authority on 11 April when they signed the contract was
not established by the facts adduced in evidence’.

[39] A distinction must be drawn between the authority of the signatories to sign
the agreement and their authority to bind Pangbourne to the agreement. Upon
signature of the agreement an inchoate agreement came into being, pending the
fulfilment of the suspensive condition.3 In the event that the suspensive condition
was not fulfilled, neither party would be bound to the agreement.4

1 See generally, R H Christie and G B Bradford The Law of Contract in South Africa 6th ed  (2011) at
151-153; S W J Van der Merwe, L F van Huyssteen, M F B Reinecke and G F Lubbe Contract
General Principles  4th ed at 253 and the authorities cited there at footnote 276.
2 ABSA Bank Ltd v Sweet & others 1993 (1) SA 318 (C) at 323A-B.
3 Joseph v Halkett (1902) 19 SC 289 at 293. More recently, see the summary of the law undertaken
by Tebbutt J in ABSA Bank Ltd v Sweet & others 1993 (1) SA 318 (C) at 323.
4 The terms of clause 16.2, quoted in para 27 above, accords with the legal position in this regard.

[40] In my view, the agreement was concluded upon signature thereof on 11 April
2007. The terms of the suspensive condition were not met. It follows that the
contractual relationship between the parties lapsed due to non-fulfilment of the
suspensive condition.

[41] Africast, in its pleadings, appears to suggest that the lack of authority on the
part of the signatories was ratified on 20 April 2007, when they were ‘authorised to
sign the property sale agreement’.5 If the decision taken by Pangbourne’s board on
20 April 2007 constituted ex post ratification of what the signatories had done, then
the contract would have been enforceable from the time of signature on 11 April
2007. Ratification operates ex tunc and not nunc. Upon ratification of an act, the
obligation incurred by the act is dated at the time of the conclusion of the act not at
the time of the ratification.6 The effect of a valid ratification would be that the
unauthorised act, namely the signature, would be assumed to have been authorised
when it was performed.7 In the light of my finding that the signatories had the
requisite authority to sign the agreement, it is not necessary to make a determination
relating to whether Pangbourne’s board had ratified their conduct.

[42] In the result the appeal is dismissed with costs.

_______________
L V Theron
Judge of Appeal

5 Paragraph 3 of the resolution of Pangbourne’s board dated 20 April 2007, relating to the agreement
and the authority of the directors reads:
‘THAT any two Directors or a Director and the Company Secretary be, as they hereby are, authorised
to sign the Property Sale Agreement which includes the Development Agreement, and that a Director
or the Company Secretary be, as they hereby are, authorised to sign all the necessary documentation
to give effect to the resolution including, but not limited to, conveyancing documents, power of
attorney to transfer, bond registration documents, and all other relevant documentation to finalise the
transaction.’
6 Reid & others v Warner 1907 TS 961 (the judgment by Innes CJ and Wessels J at 976).
7 Breytenbach v Frankel & another 1913 AD 390 at 401.

APPEARANCES:

For the Appellant:
G C Pretorius SC

Instructed by:

Cliffe Dekker Hofmeyr, Johannesburg

Phatshoane Henney, Bloemfontein

For the Respondent:    P F Louw SC

Instructed by:

Kokinis Inc, Johannesburg

McIntyre & van der Post, Bloemfontein

THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

From:
The Registrar, Supreme Court of Appeal
Date:
28 March 2014
Status:
Immediate

Please note that the media summary is intended for the benefit of the media and does not
form part of the judgment of the Supreme Court of Appeal.

Africast v Pangbourne Properties (359/13) [2014] ZASCA (2014)
The Supreme Court of Appeal handed down judgment today in an appeal from the South
Gauteng High Court, Johannesburg. The respondent (Pangbourne) is a public company listed
on the Johannesburg Stock Exchange, with its principal business being acquisition and letting
of commercial and industrial premises. The appellant (Africast) is a company within a group
that undertakes property investment and development. Between 2006 and 2007 the parties
negotiated the development of commercial property in Sunninghill, Johannesburg, which they
designated ‘The District’. Their representatives agreed on the terms of a contract for the
building of commercial premises by Africast; for the letting of those premises to tenants and
for the cession of the rights under the leases to Pangbourne, which was obliged to pay the
purchase price for the improved properties to Africast only on transfer of the properties and
cession of the leases.
The agreement between the parties contained a suspensive condition to the effect that
Pangbourne give written notice of the approval by its board of directors within seven working
days of the conclusion of the contract. It is common cause that Pangbourne, some 18 months
after the signing of the agreement, decided that the particular suspensive condition contained
in the agreement between the parties had not been fulfilled within the stipulated period, and

that it was accordingly not bound by the contract. It refused to furnish bank guarantees in
respect of the fulfilment of its payment obligation to Africast. At that stage the buildings had
been constructed in accordance with the contract, and Pangbourne’s employees had been
involved on a regular basis with the whole development.
Africast regarded Pangbourne’s decision as a repudiation of the contract: it accordingly
cancelled and sued for damages for breach of contract. Having separated the determination of
the merits and the quantum in this matter, the high court, in pronouncing on the merits, held
that the condition had not been fulfilled timeously; that Pangbourne was not bound by the
contract and that Africast was accordingly not entitled to damages.
Africast appeals that finding with the leave of the high court. The issue before this court was
therefore whether the contract had indeed lapsed because of the non-fulfilment of the
suspensive condition, and in particular the interpretation and application of the term
‘conclusion’ in the agreement.
Before this court, Africast contended that the contract was concluded only when the
Pangbourne board approved the contract on 20 April 2007. The condition was thus fulfilled
within seven business days. Conversely, Pangbourne argued that the contract was concluded
on 11 April 2007 when the contract was signed by representatives of Pangbourne and
Africast.  Accordingly, it contended, the condition had not been fulfilled timeously and the
contract had lapsed before 25 April when written notification of the board approval was sent
to Africast.
In holding that the signatories of the agreement on behalf of Pangbourne were authorised to
do so in terms of Pangbourne’s internal arrangements, this court noted that, upon such
signature, an inchoate agreement came into being pending the fulfilment of the suspensive
condition. This occurred on 11 April 2007. It follows that, by 25 April, the contractual
relationship between the parties lapsed due to non-fulfilment of the suspensive condition. As
a result thereof, no contract came into existence and thus neither party was bound to the
agreement.
In the result the appeal is dismissed with costs.