The evidence of the parties to a written agreement about what either of them may have had in mind when they concluded the agreement is irrelevant for the purpose of finding the meaning of the words they used. The process of giving meaning to the words used in a contract has regard to the context in which the words are used in the light of the document as a whole and the circumstances that led to its existence.
A contract between parties gave the one party 10% of the value of a game lodge if the company was sold. The value was to be arrived at after costs were deducted. Because what was sold was a company in the contract, the value had to be determined by ascertaining the value of its assets less its liabilities. Where the liabilities included a shareholders loan, the loan was “costs” that had to be deducted before 10% of the value of the company would be due to the other party.
Askari Adventures therefore got R403 600 as the value of the company instead of R3 230 600 which was the value of the game lodge property (in Shakawa Hunting & Game Lodge (Pty) Ltd v Askari Adventures CC).