Abraham Johannes Van Huyssteen N O and another v Milla Investment and Holding Company (Pty) Ltd

The respondent, Milla Investments and Holdings Company (Pty) Ltd (Milla), claimed rental allegedly underpaid by the Sport City Trust (the Trust) in respect of premises at Cape Gate Lifestyle Centre, Brackenfell, Cape Town. The first and second appellants were trustees of the Trust. Milla sued as cessionary of Attfund Limited, which had purchased the shopping centre from the original developer, Cape Gate Lifestyle (Pty) Ltd. On 18 August 2005, Mr van Huyssteen (the first appellant) entered into a written lease with Cape Gate for shop 17 (300 square metres) at a basic rental of R65 per square metre with 9% annual escalation. In May 2006, discussions occurred about moving to larger premises (shop LL01) of 1398 square metres in phase 2 of the development. On 5 May 2006, Cape Gate sent an offer to lease to Mr van Huyssteen. He amended it in manuscript, changing the escalation rate from 9% to 8%, adding "no escalation after year one", deleting the deposit requirement, and qualifying "other costs". He signed this amended offer on behalf of the Trust on 15 May 2006 and returned it to the letting agents. However, the amended offer never reached Mr Odendaal, Cape Gate's director responsible for leases, and was never countersigned by Cape Gate. The Trust took occupation on 3 July 2006 and commenced trading on 1 August 2006. From that date until October 2007, Attfund sent monthly invoices based on the 2005 lease terms, describing the unit as "shop 17". On 3 October 2007, Attfund advised the Trust it should have paid higher rental. This was disputed. On 27 May 2008, a new agreement was reached for reduced premises. Milla's claim was for the difference between what was paid and what it alleged should have been paid under the amended offer. The Trust contended that an oral agreement had transplanted the terms of the 2005 lease to the new premises.

• Whether a binding lease agreement had been concluded and on what terms
• Whether the doctrine of quasi-mutual assent applied to bind the parties to the terms of the amended offer to lease
• Whether the 'battle of the forms' principle was correctly applied
• Whether there was animus contrahendi (intention to contract) given that both parties believed they had already concluded an agreement on different terms
• Whether the Trust's oral agreement defence had been proved

The appeal was upheld with costs. The order of the high court was set aside and substituted with an order dismissing the action with costs.

The binding legal principle established is that the doctrine of quasi-mutual assent requires identification of the "contract asserter" and "contract denier", with the doctrine enabling the asserter to contend that the denier's conduct reasonably misled them into believing the denier had assented to the contractual terms in question. The doctrine cannot be inverted to bind a party (the contract denier) to terms it does not seek to be bound by, based on the unreasonable conduct of the party seeking to enforce those terms (the contract asserter). In cases of alleged dissensus, the party asserting the existence of a contract bears the burden of proving both its conclusion and its terms. Where a party cannot prove the contract it alleges, the claim must fail, even if the defendant's alternative version of the contract has also been rejected. The "battle of the forms" principle, as an application of quasi-mutual assent, requires that the party who "fired the last shot" must be the party seeking to enforce those terms, and the other party's subsequent conduct must have reasonably led the enforcing party to believe that party had assented to or was prepared to be bound by those terms.

The Court made several non-binding observations: 1. On animus contrahendi: The Court distinguished Rand Trading Co Ltd v Lewkewitsch 1908 TS 108 and Landmark Real Estate (Pty) Ltd v Brand 1992 (3) SA 983 (W), noting those cases involved parties who were actually ad idem on terms and contracting parties, whereas here the parties laboured under belief of different agreements. The Court confirmed these authorities stood for the principle that where parties erroneously assume a valid contract exists, this may preclude inferring a new contract. 2. On tacit acceptance: The Court noted counsel's ready concession that the first pleaded basis (tacit acceptance of the amended offer) did not bear scrutiny, confirming the established principle that failure to accept an offer within the stipulated time results in that offer lapsing (citing Laws v Rutherford 1924 AD 261). 3. On credibility findings: While noting the high court's credibility finding regarding Mr Odendaal was "somewhat generous", the Court affirmed the principle from Santam Bpk v Biddulph 2004 (5) SA 586 (SCA) that there is generally no warrant for interference with credibility findings on appeal. 4. The Court referenced Christie's observation that it remains important for a plaintiff to prove that conduct inducing the plaintiff's belief is attributable to the defendant, citing George v Fairmead (Pty) Ltd 1958 (2) SA 465 (A), and noted that application of the doctrine of quasi-mutual assent is "not without its pitfalls".

This case is significant in South African contract law for clarifying the proper application of the doctrine of quasi-mutual assent and the "battle of the forms" principle. It establishes important principles: 1. The doctrine of quasi-mutual assent is not a mechanical rule but requires careful analysis of who is the "contract asserter" and who is the "contract denier". 2. The party seeking to enforce a contract must be the one who reasonably relied on the other party's conduct. A party cannot use the doctrine to bind another party to terms that party does not seek to be bound by. 3. The "battle of the forms" principle (where the party firing "the last shot" prevails) cannot be applied where the party who sent the last document (counter-offer) is itself the contract denier. 4. Unreasonable conduct by one party (such as failing to respond to or even read a counter-offer) cannot be used by that party to bind the other party to terms the other party disputes. 5. The doctrine requires that the contract denier's conduct must have misled the contract asserter into reasonably believing agreement existed on certain terms. The case serves as a warning against misapplication of objective contractual principles and confirms that even where both defences and claims fail, the plaintiff bears the ultimate burden of proving the contract alleged. It also demonstrates the limits of the reliance theory in circumstances of dissensus where neither party's version of the agreement can be established.