National Sorghum Breweries Ltd v Corpcapital Bank Ltd

Afinta Financial Services (Pty) Ltd leased vehicles to National Sorghum Breweries Ltd under various lease agreements. Afinta Financial Services entered into a joint venture with Corpcapital Bank Ltd, conducted through Afinta Finance Ltd, to continue the leasing business. As part of the arrangement, Afinta Financial Services transferred certain lease agreements to Afinta Finance, and Afinta Finance in turn ceded its rights under those agreements to Corpcapital Bank as security for loans. Some of the lease agreements with National Sorghum Breweries were not included in the original annexures to the written cession and sale agreements but were later added through unsigned schedules and lists. National Sorghum Breweries breached the leases, and Corpcapital Bank sued as cessionary. The defendant challenged Corpcapital Bank’s standing, arguing that the later additions constituted invalid variations contrary to non-variation clauses.

The appeal was dismissed with costs, including the costs of two counsel.

The case clarifies the interpretation and limits of non-variation clauses in South African contract law, particularly in the context of cession agreements. It confirms that implementing or giving effect to an agreement as contemplated does not constitute a variation requiring compliance with non-variation clauses, thereby providing certainty in commercial and financing transactions.