Passenger Rail Agency of South Africa v Sbahle Fire Services CC

PRASA appointed Sbahle Fire Services CC in December 2008 as fire and safety consultant for the Mabopane Bridge Redevelopment Project. The contracts fixed fees for fire consultancy and safety consultancy (the latter at 5% of estimated project cost), with provision for additional fees if PRASA required material additional services due to alterations, extensions or modifications. The project was scheduled to end on 31 May 2010 but was delayed and extended until at least August 2013 due to design changes, land disputes and additional work introduced by PRASA. Sbahle continued rendering services and invoiced PRASA for additional safety consultancy fees for the extended period. PRASA paid certain amounts but disputed liability for further fees and instituted a claim in reconvention seeking repayment of R2 034 938.19, alleging it was paid in error. The High Court upheld Sbahle’s claim for additional fees and dismissed the reconvention. PRASA appealed.

The appeal succeeded in respect of Sbahle’s second claim, which was dismissed with costs. The appeal was dismissed in respect of PRASA’s claim in reconvention. The High Court’s order was set aside to the extent necessary and substituted accordingly.

The case is significant for reaffirming South African principles on contractual interpretation, particularly fee provisions in consultancy contracts, and for clarifying the strict requirements for enrichment claims based on the condictio indebiti. It underscores the evidentiary burden on a party alleging mistaken payment and the relevance of context and subsequent conduct in interpreting contracts.