The respondent in Airports Company SA Limited v Masiphuze Trading (Pty) Ltd was unsuccessful in relying on the defence of justifiable error in trying to avoid being bound by a suretyship agreement that he signed but did not read.
The respondent entered into a suretyship for a lease debt in respect of premises at the international airport in Durban. The suretyship was incorporated into the lease document and bound the respondent as surety for and co-principal debtor with the lessee. The respondent alleged that he signed as a shareholder of the lessee company and not as a surety.
The defence of justifiable error he relied on was based on the fact that the fellow sureties did not tell the respondent that the lessor required all the shareholders to bind themselves personally as sureties. They did not warn him that in signing the lease with its annexures he was binding himself as surety for the due performance by the lessee company of its obligations.
A unilateral error by a signatory can only be set up as a defence if the error is reasonable and is not induced by the other party. The scope for a defence of unilateral mistake is very narrow, if it exists at all.
The respondent claimed that he was misled by the failure of his business associates to inform him that he was signing a deed of suretyship. The surety, as an experienced businessperson, did not check the documents he was signing which was not reasonable. The lessor was entitled to rely on his declared intention to be bound by the deed of suretyship indicated by his signature. The lessor did not mislead the surety in any way. There was nothing objectionable in the lease documents. A cursory glance through them would have shown that the shareholder was being required to sign a deed of suretyship.
The defence of justifiable error failed.