Botha v Giyose t/a Paragon Fisheries

The dispute arose from the alleged sale of a fast‑food business in Queenstown. The appellant, Mr D B Botha, claimed that he sold the business as a going concern to the respondent, Mr Giyose, for R90 000 under an oral agreement concluded on 31 January 2003. The price was payable by an initial amount of R45 000 and the balance in monthly instalments, with interest. Possession of the business was handed over and the respondent commenced trading but failed to make any payments. It later emerged during trial that the business was owned by a close corporation, Dacawi Investments CC, of which the appellant and his family were members, although the respondent had not been informed of this at the time of contracting. The respondent denied the existence of the agreement and later challenged the appellant’s locus standi to sue.

The appeal was upheld. The order of the High Court was set aside. The magistrates’ court order was substituted with an order granting judgment for the appellant for the unpaid initial payment of R45 000 and the February to June 2003 instalments, together with interest as specified. Each party was ordered to bear its own costs in the High Court appeal, while costs in the magistrates’ court were awarded to the appellant on an attorney and client scale.

The case clarifies South African law on the doctrine of the undisclosed principal, confirming that an agent who contracts in his own name may sue the third party personally. It also reinforces fundamental principles of contract law regarding the election of remedies after breach, particularly the incompatibility of cancellation and a claim for the full purchase price.