Holm Jordaan & Partners CC v City of Tshwane Metropolitan Municipality

The appellant, Holm Jordaan & Partners CC (HJ), an architectural firm, won a design competition (Project Phoenix) in 1999 run by the City Council of Pretoria for new municipal headquarters. The competition rules expressly stated that the promoter was under no obligation to proceed with the project. Over subsequent years, municipal restructuring and expanded accommodation needs led to substantial changes in scope and cost. In April 2003, the City of Tshwane resolved to commission HJ as architect, conditional upon the services being rendered through a joint venture with a BEE partner and subject to final agreement on terms and funding. No BEE partner was identified and no final client–architect agreement was concluded. HJ nonetheless performed additional work (including bulking and feasibility-related services) and was paid for that work. In 2009, the City rescinded its earlier resolution and decided to pursue a Public Private Partnership instead. HJ alleged this amounted to repudiation of a binding contract and sued for damages representing lost future fees.

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

The case clarifies South African contract law principles relating to incomplete or conditional agreements, particularly in complex construction and professional service contexts. It confirms that winning a design competition and subsequent conditional resolutions do not, without consensus on material terms, create a binding contract. It also affirms that an owner’s decision not to proceed with a building project does not constitute repudiation of an architect’s commission.