Shoprite Checkers (Pty) Ltd v Bumpers Schwarmas CC and Others

Shoprite Checkers (Pty) Ltd sold a business as a going concern to Bumpers Schwarmas CC in terms of a written sale agreement. After the conclusion of the agreement, the respondents sought rectification of the contract, alleging that it failed to record a common intention that Shoprite was obliged to procure a lease for the purchaser on terms identical to a previous lease (the Palmer lease), save for duration and rental. Evidence was led concerning pre-contractual discussions with the landlord’s representatives, Hirschfield and Fine, who testified that any new lease would necessarily include a ‘development clause’ allowing the landlord to terminate the lease on notice for redevelopment. The court a quo accepted the respondents’ version and granted rectification. Shoprite appealed to the Supreme Court of Appeal.

The appeal was upheld with costs. The order of the court a quo was set aside and replaced with an order dismissing the respondents’ claim for rectification and directing them to pay the appellant’s costs. The respondents’ application to amend their counterclaim was also dismissed with costs.

The case reaffirms the strict requirements for rectification of contracts in South African law, particularly the need to prove a common continuing intention that was incorrectly recorded in writing. It illustrates the centrality of credible evidence and probabilities in factual disputes and confirms that rectification will not be granted where material terms alleged were known not to reflect the true position at the time of contracting.