This blog was co-authored by Dashia Govinden, Candidate Attorney.
This case explores the tension between contractual non-variation clauses and public policy, and in what circumstance adherence to written agreements should yield to fairness and equity. It examined the enforceability of a non-variation clause and found that public policy did not justify deviating from the clearly defined contractual terms.
The dispute arose when the first defendant leased office equipment from the third defendant under a Master Rental Agreement (MRA), which was altered by a handwritten amendment to the rental amount, leading to conflicting claims over the amendment’s validity. The plaintiffs sought to enforce the higher rental, while the defendants argued that the MRA’s non-variation clause rendered the amendment unenforceable. The first defendant counterclaimed for overpayments, relying on public policy considerations.
The court reaffirmed the frequently-applied principle from SA Sentrale Ko-op Graanmaatskappy Bpk v Shifren, which holds that non-variation clauses are binding and prevent amendments unless formal procedures are followed. The MRA’s non-variation clause required amendments to be in writing and signed by both parties. Since the disputed amendment was not signed by the plaintiff, it was deemed unenforceable. The court emphasised that formalities must be adhered to for certainty and predictability in commercial transactions.
The defendants argued that enforcing the non-variation clause would contravene public policy, leading to the unjust enrichment of the plaintiff. The court relied on the Constitutional Court judgment in Beadica 231 CC v Trustees of the OregonTrust, which held that public policy could override contractual terms in exceptional cases and only where there is a compelling justification, such as a conflict with fundamental constitutional values. In the absence of such justification in the present matter, the court upheld the enforceability of the non-variation clause.
This case reinforces the importance of contractual certainty in commercial law. The judgment upholds the Shifren principle, limits the role of public policy in evading contractual obligations, and emphasises the need for parties to comply with agreed formalities. While fairness remains a guiding principle, it cannot invalidate clear contractual terms without strong justification. The court’s decision highlights the balance between enforcing non-variation clauses and safeguarding public policy.