The Butcher Shop and Grill CC v The Trustees for the time being of the Bymyam Trust

The respondent trust, owner of sectional title premises in Mouille Point, leased the premises in 2014 to the appellant, The Butcher Shop and Grill CC, for use as a restaurant. From inception the appellant sublet the entire premises to a related company, Apoldo Trading (Pty) Ltd, which operated the restaurant. In 2019 the trust formally consented to the sublease by addendum, recording that the appellant remained responsible for the lease obligations and that Apoldo was jointly and severally liable. Following the Covid-19 pandemic and national lockdown regulations from March 2020, restaurant trading was prohibited or severely restricted. The appellant withheld payment of rent, claiming remission due to loss of beneficial use and enjoyment caused by vis major. The trust sued for arrear rental exceeding R1.5 million. The appellant counter-applied for a declaration of entitlement to remission, relying on the loss suffered by its sub-tenant and alternatively arguing for piercing (or reverse piercing) of the corporate veil between itself and Apoldo. The High Court rejected the counter-application and granted judgment for the trust. The appellant appealed to the Supreme Court of Appeal.

The appeal was dismissed with costs, and the High Court order requiring the appellant to pay the arrear rental, interest and costs was confirmed.

The judgment clarifies the limits of rent remission claims arising from Covid-19 lockdown measures, confirming that only the party who directly suffers loss of beneficial occupation may claim remission. It affirms strict adherence to separate juristic personality in lease and sublease contexts and rejects reverse piercing of the corporate veil absent unconscionable abuse. The case is significant for landlords, tenants and corporate groups operating through subleasing arrangements.