Seeff Commercial and Industrial Properties (Pty) Limited v Silberman

The respondent, Silberman, owned commercial property in Gezina, Pretoria, and wished to redevelop it while residing in Australia. He engaged the appellant, Seeff Commercial and Industrial Properties (Pty) Ltd, represented by Braudé, in September 1994 in relation to the demolition of the existing building and erection of a new one. The respondent alleged that a contract was concluded whereby the appellant would act as project manager for a turnkey project, ensure completion by mid-May 1995, keep costs within a stipulated maximum, and deliver a defect-free building. The alleged contractual terms were recorded in a letter (Annexure A1) from the respondent’s attorneys. The appellant replied with a letter (Annexure A5) stating that it accepted the contents ‘in principle’, made certain comments regarding costs, VAT, demolition dates, and possible price escalations, and then proceeded with the project. The respondent later complained of late completion, defects, and cost overruns, and sued for damages of approximately R2 million. The appellant denied that a binding contract on the pleaded terms had been concluded, contending that A5 was a counter-offer that was never accepted.

The appeal was dismissed with costs, including the costs of two counsel. The order of the court a quo was confirmed subject to amendment: the contract was held to consist of Annexure A1 as amended only by paragraph 1 of Annexure A5 insofar as it related to increases in the price of materials, and not to changes in design.

The case is an important South African authority on tacit acceptance and the circumstances in which silence and conduct can constitute acceptance of a counter-offer. It clarifies the application of classical offer-and-acceptance principles in commercial transactions and confirms that express communication of acceptance is not always required where the offeror dispenses with it, expressly or impliedly.