Spenmac (Pty) Ltd (formerly Bobcart (Pty) Ltd) v Tatrim CC

Spenmac sold a commercial unit (unit 1) in a sectional title scheme to Tatrim for R10.5 million. Prior to the sale, Spenmac’s representative represented, orally and through a brochure, that the scheme consisted of only two units and that the owner of unit 1 enjoyed a right of veto over any subdivision of unit 2 in terms of the scheme rules. In fact, unit 2 had already been subdivided into 110 units pursuant to consent granted by Spenmac in 2007, and the subdivision was registered in July 2010. Both parties were unaware of this at the time of contracting. After discovery of the subdivision during conveyancing, Tatrim sought to avoid the contract, alleging that it had purchased under a fundamental mistake induced by misrepresentation. Spenmac relied on a voetstoots and non‑representation (exemption) clause.

The appeal was dismissed with costs, confirming the High Court’s order setting aside the agreement of sale and ordering repayment of the purchase monies with interest.

The case confirms and strengthens South African contract law principles that an innocent misrepresentation inducing a fundamental mistake vitiates consensus and renders a contract void ab initio, notwithstanding exemption or non‑representation clauses. It clarifies the limits of voetstoots clauses and affirms the primacy of true consensus in contract formation.