THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA
JUDGMENT
CASE NO: 207/07
Reportable
In the matter between:

BASTIAN FINANCIAL SERVICES (PTY) LTD
Appellant

and

GENERAL HENDRIK SCHOEMAN
PRIMARY SCHOOL
Respondent

Coram:
Harms ADP, Streicher, Heher & Van Heerden JJA et Hurt AJA

Heard:
9 May 2008

Delivered:
30 May 2008

Summary:
Contract – public school – liability of school for contractual
damages – whether s 60(1) of Schools Act 84 of 1996 renders
the State liable for claims for contractual damages against a
public school

Neutral citation: Bastian Financial Services v General Hendrik Schoeman
Primary School (207/2007) [2008] ZSCA 70 (30 May 2008)

VAN HEERDEN JA:

Introduction
[1] A public school leased photocopier equipment from a supplier for a
specified period. The school then failed to pay the instalments due under
the written lease agreement. The supplier cancelled the agreement and sued
the school in the magistrate’s court, claiming (inter alia) payment of the
total rentals which would have been payable had the agreement run its
prescribed course. Provided that the supplier can prove its case
satisfactorily, is the public school liable to the supplier in this regard? In
the ordinary course, one would have thought so. The school, however,
thought otherwise, and the relevant magistrate’s court, as well as the
Pretoria High Court, agreed with it. The issue which must be decided in the
present appeal is whether the magistrate’s court and the court below were
correct in that conclusion.
[2] During 2002, the appellant, Bastian Financial Services (Pty) Ltd
(BFS), instituted action in the Brits Magistrate’s Court against the
respondent, the General Hendrik Schoeman Primary School (the School),
claiming relief arising from the cancellation of a lease agreement. The
School opposed the action, denying that it was in breach of any of the terms
of the agreement and pleading repudiation of the agreement by BFS. The
School also raised certain special pleas to the claim. The special plea
relevant to this appeal is based on the provisions of s 60(1) of the Schools
Act 84 of 1996 (the Act), which section imposes liability on the State for
damage or loss caused ‘as a result of any act or omission in connection
with any educational activity conducted by a public school’, for which the
school would otherwise have been liable. The School pleaded that BFS had
sued the wrong party. It claimed that the School was indemnified against

the contractual claim, which it contended had to be instituted against the
Member of the Executive Council for Education of the North West
Province (the MEC) as the provincial representative of the State. This
special plea was upheld by the magistrate, whose decision was confirmed
on appeal by the court a quo (per Preller J, Engelbrecht AJ concurring).
The present appeal comes before us with leave granted by that court.
Factual background
[3] The written agreement, in terms of which BFS leased certain
photocopier equipment to the School for a period of five years, was
concluded during September 1999. It is common cause that the equipment
was rented by the School in connection with ‘educational activities’
conducted by it. As indicated above, BFS cancelled the agreement and,
relying on the express provisions thereof, claimed the following relief:
•
confirmation of its cancellation of the agreement;
•
return of the equipment to BFS;
•
payment of the sum of R461 318,33 plus VAT, being the aggregate
value of the rentals which would have been payable had that agreement
continued until the expiry of the rental period;
•
interest on the latter amount at the agreed rate;
•
costs on the attorney and client scale.
[4] Before the magistrate, only the special pleas were argued, with no
viva voce evidence being presented by either side.

Statutory framework
[5] With regard to the School’s special plea based on s 60(1), BFS
presented a twofold argument: first, it contended that its claim was not one
for ‘damage or loss’, as contemplated by s 60(1); rather, it was one for
specific performance in terms of the contract. Second, BFS contended that
in any event, on a proper interpretation of s 60(1), it applies only to claims
arising in delict and not to claims for contractual damages.
[6] I shall first consider the argument based on the interpretation of
s 60(1). In this regard, the court a quo concluded that the ordinary
grammatical meaning of the words ‘damage or loss caused as a result of
any act or omission in connection with any educational activity’ includes
claims for damages arising from both contract and delict.
[7] The issues presently under discussion arose in Technofin Leasing &
Finance (Pty) Limited v Framesby High School & Another.1 It appears that
neither counsel nor the High Court was aware of that decision prior to the
date of judgment – the only reference to the decision that appears in the
record is in the High Court’s judgment granting leave to appeal to this
court. In the Framesby matter – incidentally also involving the lease of
photocopier machines to a public school – the parties, by way of a stated
case, required the court to interpret s 60 of the Act so as to determine which
of the school or the relevant MEC was liable to the plaintiff for breach of
contract, if such breach could be proved. In his judgment, Pickering J
considered similar arguments to the ones advanced before us and

1 2005 (6) SA 87 (SE).

concluded ‘that there is no reason to limit the State's liability in terms of
s 60 so as to exclude damage or loss caused contractually’.2
[8] Before the most recent amendment to s 60 (in terms of the
Education Laws Amendment Act 31 of 1997, which came into operation on
31 December 2007 and thus does not apply to the present matter),3 the
section provided:
‘(1)
The State is liable for any damage or loss caused as a result of any act or
omission in connection with any educational activity conducted by a public school and
for which such public school would have been liable but for the provisions of this
section.
(2)
The provisions of the State Liability Act, 1957 (Act No. 20 of 1957), apply to
any claim under subsection (1).
(3)
Any claim for damage or loss contemplated in subsection (1) must be instituted
against the Member of the Executive Council concerned.
(4)
Despite the provisions of subsection (1), the State is not liable for any damage
or loss caused as a result of any act or omission in connection with any enterprise or
business operated under the authority of a public school for purposes of supplementing
the resources of the school as contemplated in section 36, including the offering of
practical educational activities relating to that enterprise or business.
(5)
Any legal proceedings against a public school for any damage or loss
contemplated in subsection (4), or in respect of any act or omission relating to its
contractual responsibility as employer as contemplated in section 20(10), may only be

2 At 95E. Cf also Strauss v MEC for Education, Western Cape Province 2007 (4) SA 127 (C) paras 25-
28.
3 The effect of the amendment is that  the words ‘educational activity’ in s 60(1) have been replaced with
the words ‘school activity’, this latter expression being defined in the Act to mean ‘any official
educational, cultural, recreational or social activity of the school within or outside the school
premises’(see s 60(1)(a) of the Act, as amended, read with the definition of ‘school activity’ inserted in
s 1 of the Act by s 4(c) of Act 31 of 2007). A new para (b) has been inserted into s 60(1), providing that,
if the school activity in question is covered by an insurance policy taken out by the school, the liability of
the State is limited to the damage or loss not covered by the policy.

instituted after written notice of the intention to institute proceedings against the school
has been given to the Head of Department for his or her information.’
[9] Other provisions of the Act which are relevant to this appeal are
s  15, certain subsections of ss 16, 20, 21 and 34, s 36 (prior to amendment
of this section in 2001)4 and s 58A(4):
•
Section 15, under the heading ‘Status of public schools’, provides that every
public school is a juristic person, with legal capacity to perform its functions in terms of
the Act.
•
Section 16 deals with ‘Governance and professional management of public
schools’ and provides that the governance of every public school is vested in its
governing body, which ‘may perform only such functions and obligations and exercise
only such rights as prescribed by the Act’ (subsec (1)). A governing body stands in a
position of trust towards the school (subsec (2)), while the ‘professional management’
of a public school must be undertaken by the principal under the authority of the Head
of Department (subsec (3)).
•
Section 20 deals with ‘Functions of all governing bodies’ and provides, in sub-
sec (4), that, subject to the Act and certain other provisions, ‘a public school may
establish posts for educators and employ educators additional to the establishment
determined by the Member of the Executive Council in terms of section 3(1) of the
Educators’ Employment Act, 1994.’
•
Subsection (5) permits a public school to ‘establish posts for non-educators and
employ non-educators additional to the establishment determined in terms of the Public
Service Act, 1994 (Proclamation No. 103 of 1994).’

4 Section 36 was amended by s 5 of the Education Laws Amendment Act 57 of 2001, in terms of which
two new subsections (subsecs (2) and (3)) were added to s 36. The amending Act came into operation on
5 December 2001, ie after the lease agreement was entered into by BFS and the School.

•
Subsection (10) provides that, ‘(d)espite section 60, the State is not liable for
any act or omission by the public school relating to its contractual liability as the
employer in respect of staff employed in terms of subsections (4) and (5).’
•
Section 21, dealing with ‘Allocated functions of governing bodies’, provides
(in subsec (1)) that a governing body may apply to the Head of Department in writing to
be allocated certain functions, including the purchasing of textbooks, educational
materials and equipment for the school and the payment for services to the school
(paragraphs (c) and (d) of subsec (1)).
•
The Head of Department may refuse an application made by the governing
body in terms of subsec (1) only if the governing body concerned does not have the
capacity to perform such function effectively (subsec (2)); or may approve such
application unconditionally or subject to conditions (subsec (3)). The decision of the
Head of Department must be conveyed in writing to the governing body concerned,
giving reasons (subsec (4)), whereupon any person aggrieved by this decision may
appeal to the Member of the Executive Council (subsec (5)).
•
In terms of s 21(6), ‘the Member of the Executive Council may, by notice in
the Provincial Gazette, determine that some governing bodies may exercise one or more
functions without making an application contemplated in subsection (1), if –
(a) he or she is satisfied that the governing bodies concerned have the capacity to
perform such function effectively; and
(b) there is a reasonable and equitable basis for doing so.’5
•
Section 34 places an obligation on the State to ‘fund public schools from
public revenue on an equitable basis in order to ensure the proper exercise of the rights
of learners to education and the redress of past inequalities in education provision.’

5 In the Framesby case, the MEC concerned had allocated certain functions to school’s governing body in
terms of a notice published in the Provincial Gazette. The functions thus allocated to the governing body
included those listed in paras (c) and (d) of s 21(1), as set out above.

•
In terms of s 36, the governing body of a public school ‘must take all
reasonable steps to supplement the resources supplied by the State in order to improve
the quality of education provided by the school to all learners at the school’.
•
Finally, s 58A regulates ‘Alienation of assets of public school’ and provides, in
subsec (4) thereof, that ‘(t)he assets of a public school may not be attached as a result of
any legal action taken against the school.’6
[10] For the sake of completeness, mention should also be made of the
Preamble to the Act, the relevant portion of which provides that –
‘WHEREAS this country requires a new national system for schools which will . . .
promote their7 acceptance of responsibility for the organisation, governance and funding
of schools in partnership with the State . . . .’.
Interpretation of section 60(1) of the Act
[11] BFS contended, inter alia, that the inclusion of the words ‘any act or
omission in connection with’ in s 60(1) indicated an intention on the part of
the legislature to limit the circumstances under which the State would be
held liable for damage or loss, to delictual claims against a public school.
Moreover, so counsel for BFS submitted, the wording of s 60(1) (in
particular, the reference to ‘act or omission’) has a particular ‘delictual
flavour’ in that, although this term is not used exclusively in the delictual
sphere, this is the area of law where it is most often to be found.

6 Section 58A was inserted into the Act by s 6 of the Education Laws Amendment Act 24 of 2005, which
came into operation on 26 January 2006, ie also after the date of conclusion of the lease agreement.
Because s 58A(4) relates to execution proceedings against the school, however, it would apply to any
such proceedings instituted after the commencement of the amending Act on 26 January 2006.
7 This would seem to refer to ‘all learners, parents and educators’, a phrase which, with the insertion of
the word ‘and’, occurs immediately before the quoted sentence in the Preamble commencing with the
word ‘promote’.

[12] A further argument advanced by counsel for BFS was to the effect
that, in terms of the Act, public schools have been given a high degree of
autonomy in conducting their own affairs, through the medium of their
respective governing bodies in which the governance of public schools is
vested. The corollary of the freedom to enter into contracts conferred on the
governing bodies of public schools by the Act (in particular ss 20 and 21
thereof), so it was contended, is that such schools must be held accountable
under contracts entered into on their behalf by their governing bodies. This
accountability would include liability to the other party to such a contract
for both specific performance and damages for breach thereof.
[13] Counsel for the school countered these submissions by pointing to
the broad wording of s 60(1) and the fact that the section does not make
any express reference to delictual liability, the State’s liability being
expressed in the most general language. So too, the term ‘act or omission’
contained in s 60(1) is not defined or expressly limited in any way. Thus,
argued counsel, when given their ordinary grammatical meaning, these
words include any step of any nature or any obligation required to be
fulfilled. Interpreted in this way, the words must include within their ambit
any breach of any term of a contract requiring the school to take certain
steps or to fulfil certain obligations and, likewise, any failure on the part of
the school to take such a step or to fulfil such an obligation in terms of the
contract.
[14] In advancing these arguments, counsel for the school relied on the
following dictum of Van Zyl J in Strauss v MEC for Education:8

8 Supra n 2 para 28.

‘In this regard, s 60(1) of the Act has been described as an “umbrella provision”
directed at establishing State liability in the circumstances referred to in such section.
See Louw en ’n Ander v LUR vir Onderwys en Kultuur, Vrystaat, en ’n Ander 2005 (6)
SA 78 (O) ([2006] 4 All SA 282) in para [13] at 85B-C (SA) (per Cillié J):
“Artikel 60(1) is ’n sambreelbepaling wat daarop gerig is om aanspreeklikheid
by die Staat te vestig in die omstandighede waarna in die artikel verwys word.
Opvoeding
in
’n
openbare
skool
is
in
die
eerste
instansie
’n
Staatsverantwoordelikheid. Daarom maak dit sin dat die Wetgewer die Staat
verantwoordelikheid wil laat aanvaar vir skade of verlies wat veroorsaak word
as gevolg van ’n daad of versuim wat voortspruit uit ’n opvoedkundige
aktiwiteit by ’n openbare skool.”
See also the Technofin case [supra n 1] at 92I-93C (SA), where Pickering J observed
that s 60 “is couched in the broadest of terms and the State’s liability is expressed in the
most general language”. Indeed, in the “wide language” of the section there was nothing
to indicate that it was restricted to delictual liability.’9
[15] The court below concluded that the ordinary grammatical meaning
of the words ‘damage or loss caused as a result of any act or omission’ in
s 60(1) includes claims for damages arising from both contract and delict.
As I have already stated, 10  this was also the conclusion reached by
Pickering J in Framesby:11
‘There is, therefore, in my view, nothing in the wide language of s 60 itself which
indicates that it was the intention of the Legislature to limit the liability referred to
therein to delictual liability only.’

9 See also Strauss paras 24-25.
10 See para 7 above.
11 Supra n 1 at 93C.

[16] In Manyasha v Minister of Law and Order,12 this Court reiterated
the so-called ‘golden rule’ of statutory interpretation13 in the following
terms:
‘It is trite that the primary rule in the construction of statutory provisions is to ascertain
the intention of the Legislature . . . One seeks to achieve this, in the first instance, by
giving the words of the provision under consideration the ordinary grammatical
meaning which their context dictates, unless to do so would lead to an absurdity so
glaring that the [Legislature] could not have contemplated it’.
[17] It is, however, also a well-established rule of construction that
words used in a statute must be interpreted in the light of their context, and
that, in this regard, the ‘context’ –
‘[I]s not limited to the language of the rest of the statute regarded as throwing light of a
dictionary kind on the part to be interpreted. Often of more importance is the matter of
the statute, its apparent scope and purpose, and, within limits, its background . . . the
legitimate field of interpretation should not be restricted as a result of an excessive
peering at the language to be interpreted without sufficient attention to the contextual
scene.’14
[18] This dictum from Jaga’s case has been quoted with approval by the
Constitutional Court in, inter alia, Bato Star Fishing (Pty) Ltd v Minister of
Environmental Affairs & Others, 15 that court remarking further – with
reference to Thoroughbred Breeders’ Association v Price Waterhouse16 –

12 1999 (2) SA 179 (SCA) at 185B-C.
13 See, eg, LM du Plessis ‘Statute Law and Interpretation’ in 25(1) Lawsa (reissue, 2001) para 302 p 282-
283, para 309 p 290-291 and the other authorities there cited.
14 See Jaga v Dönges NO & Another; Bhana v Dönges NO & Another 1950 (4) SA 653 (A) at 662G-H
and 664H (from the dissenting judgment of Schreiner JA, described by Du Plessis op cit para 310 p 297-
298 as ‘the judge’s seminal exposition of an interpretive modus operandi honouring the exigencies of
both language and context’, and as ‘probably one of the most frequently relied on minority judgments in
the history of South African case law’).
15 2004 (4) SA 490 (CC) para 89.
16 2001 (4) SA 551 (SCA) para 12 of the concurring judgment by Marais JA, Farlam AJA and Brand AJA
(at 600 E-H).

that ‘the emerging trend in statutory construction is to have regard to the
context in which the words occur, even where the words to be construed
are clear and unambiguous.’17 The relevant passage from the Thoroughbred
Breeders’ Association case reads:
‘The days are long past when blinkered peering at an isolated provision in a statute was
thought to be the only legitimate technique in interpreting it if it seemed on the face of it
to have a readily discernable meaning. As was said in University of Cape Town v Cape
Bar Council and Another 1986 (4) SA 903 (A) at 941D-E:
“I am of the opinion that the words of s 3(2)(d) of the Act [the Admission of
Advocates Act 74 of 1964], clear and unambiguous as they may appear on the
face thereof, should be read in the light of the subject-matter with which they are
concerned, and that it is only when that is done that one can arrive at the true
intention of the Legislature.” ’
[19] It has also long been recognised in our case law that the aim of
statutory interpretation is to give effect to the object or purpose of the
legislation in question. Thus, in Standard Bank Investment Corporation Ltd
v Competition Commission & Others; Liberty Life Association of Africa
Ltd v Competition Commission & Others, 18 Schutz JA, writing for the
majority of this Court, stated that:–
‘Our Courts have, over many years, striven to give effect to the policy or object or
purpose of legislation. This is reflected in a passage from the judgment of Innes CJ in
Dadoo Ltd and Others v Krugersdorp Municipal Council 1920 AD 530 at 543. But the
passage also reflects that it is not the function of a court to do violence to the language
of a statute and impose its view of what the policy or object of a measure should be.’

17 Bato Star Fishing para 90. See further Du Plessis op cit para 310 p 298.
18 2000 (2) SA 797 (SCA) para 16.

The learned judge referred19 to Public Carriers Association and Others v
Toll Road Concessionaries (Pty) Ltd and Others20 as illustrative of the
proposition that ‘our law is an enthusiastic supporter of “purposive
construction” in the sense stated by Smalberger JA’ in that case as
follows:21
‘The primary rule in the construction of statutory provisions is to ascertain the intention
of the Legislature. It is now well-established that one seeks to achieve this, in the first
instance, by giving the words of the enactment under consideration their ordinary
grammatical meaning, unless to do so would lead to an absurdity so glaring that the
Legislature could not have contemplated it . . . Subject to this proviso, no problem
would normally arise where the words in question are only susceptible to one meaning:
effect must be given to such meaning. In the present instance the words [which fell to be
interpreted by the court] are not linguistically limited to a single ordinary grammatical
meaning. They are, in their context, on a literal interpretation, capable of bearing the
different meanings ascribed to them by the applicants, on the one hand, and the
respondents, on the other. Both interpretations being linguistically feasible, the question
is how to resolve the resultant ambiguity. As there would not seem to be any
presumptions or other recognised aids to interpretation which can assist to resolve the
ambiguity, it is in my view appropriate to have regard to the purpose of [the statutory
provision in question] in order to determine the Legislature’s intention.
. . . .
. . . Mindful of the fact that the primary aim of statutory interpretation is to arrive at the
intention of the Legislature, the purpose of a statutory provision can provide a reliable
pointer to such intention where there is ambiguity . . . .
Be that as it may, it must be accepted that the literal interpretation principle is firmly
entrenched in our law and I do not seek to challenge it. But where its application results
in ambiguity and one seeks to determine which of more than one meaning was intended

19 At para 21. See also paras 19, 20 and 22.
20 1990 (1) SA 925 (A).
21 At 942I-944A.

by the Legislature, one may in my view properly have regard to the purpose of the
provision under consideration to achieve such objective.’22
[20] At first glance, the wording of s 60(1) is indeed sufficiently broad
and general to include within its ambit liability for both delictual and
contractual damages, as argued by the School. On the other hand, it is
equally capable of being interpreted so as to apply only to claims in delict
against a public school, rendering the State liable for only such claims to
the exclusion of the public school in question, as argued by BFS. Thus, in
the words of Smalberger JA in Public Carriers Association,23 ‘the words . .
. are not linguistically limited to a single ordinary grammatical meaning.’
One therefore has to have regard to the context24 in which these words are
used in the Act, seen against the background of the purpose of this
legislation.
[21] Counsel for both parties accepted that s 60(1) does not exempt a
public school from liability to render specific performance of contractual
obligations lawfully25 undertaken by the school’s governing body on its
behalf. Any claim for specific performance by the other party to the contact
would thus have to be instituted against the public school concerned, and
not against the MEC. Counsel also accepted that a claim for the return of
goods at the instance of the supplier of such goods to a public school, in
terms of a contract entered into with the school, would have to be instituted

22 See further on the purposive approach to statutory interpretation (‘purposivism’), Du Plessis op cit para
304 p 285, para 311 p 300-301, para 349 p 388-389, para 353 p 393-395 and the other authorities there
cited.
23 Supra n 20 at 943B, as quoted in the preceding paragraph.
24 The ‘context’ bearing the broad meaning ascribed to it by Schreiner JA in Jaga’s case, supra n 14 at
662 G-H, as quoted in para 17 above.
25 Viz, with the written permission of the Head of Department given in terms of s 21 of the Act, in
circumstances in which such written permission is required: see para 9 above.

against the school itself and not against the MEC. In my view, both these
propositions are correct.26 Even the broad and general wording of s 60(1)
cannot legitimately be interpreted to render the State liable for specific
performance of contractual obligations lawfully undertaken by a public
school through the medium of its governing body.
[22] The public school itself, and not the State, is therefore liable for the
fulfilment of a public school’s contractual obligations – the other party to
the contract cannot, as it were, rely on some sort of ‘warranty’ by the State
that the school will perform its obligations under contracts which have been
lawfully concluded. This being so, it is difficult to understand why the
Legislature would have intended s 60(1) of the Act to have the effect of
imposing upon the State a ‘warranty’, vis à vis the other party to a contract
with a public school, to pay contractual damages to such other contracting
party should the school breach its contractual obligations.
[23] As pointed out by counsel for BFS, the Act envisages the creation
of a ‘partnership’ between the State, on the one hand, and the ‘learners,
parents and educators’ of a public school, on the other, all the ‘partners’
taking responsibility for the organisation, governance and funding of the
school.27 The scheme of the Act is such that the ‘learners, parents and
educators’ of a public school are represented by its governing body, the
elected membership of which includes representatives of all such
categories.28 In giving effect to the idea of a ‘partnership’, the Act confers
on public schools, through their governing bodies, a considerable degree of

26 See, in this regard, the Framesby case, supra n 1 at 94H-95C.
27 See the Preamble to the Act, quoted in para 10 above.
28 See s 23 of the Act, in particular s 23(2).

autonomy in the governance of the school’s affairs.29 Section 60(1) of the
Act exempts the school from delictual liability arising from ‘any
educational activity conducted by it’,30 and so protects both the school and
the victims of any such delict from the potentially dire consequences of a
delictual claim. To my mind, this is the intended reach of s 60(1): it would
be contrary to the purpose and scheme of the Act as a whole to interpret the
section in a manner so as to shift to the State liability for contracts lawfully
entered into by the school simply because the school breaches its contract
and the other party seeks, not specific performance of the contract, but
rather damages for such breach. It is perhaps important to note that, with
effect from 26 January 2006, the risk of essential school equipment such as
textbooks, classroom furniture, teaching materials, sporting equipment and
the like being attached and sold in execution of the school’s judgment debts
no longer exists.31
[24] One last aspect must be mentioned. Section 20(10)32 of the Act
exempts a public school from liability for ‘any act or omission by the
public school relating to its contractual liability as the employer in respect
of’ additional educators or non-educators employed by the school
governing body itself in terms of ss 20(4) and (5) of the Act. In LUR vir

29 The structure and reach of the Act in this regard is explained in some detail by Bertelsman AJ in Die
Ferdinand Postma Hoërskool v Die Stadsraad van Potchefstroom and Others [1999] 3 All SA 623 (T) at
629j-633d.
30 With the exception of liability for loss or damage flowing from an enterprise or business operated under
the autonomy of the school for purposes of supplementing the resources of the school as contemplated in
s 36: see s 60(4). In terms of s 36, the governing body of a public school is in fact obliged to take all
reasonable steps to supplement the school’s resources in order to improve the quality of education
provided by the school to its learners.
31 See s 58A of the Act, inserted by s 6 of the Education Laws Amendment Act 24 of 2005 (date of
operation 26 January 2006). The wording of s 58A is quoted in para 9 above. Cf the Framesby case, supra
n 1 at 93I-J.
32 The wording of which appears in para 9 above.

Onderwys en Kultuur, Vrystaat v Louw en ’n Ander,33 this court held that
s  20(10) does not exclude the liability of the State for delictual damage or
loss caused by the negligent act or omission of an educator or non-educator
employed by the governing body of a public school under ss 20(4) or (5).
In this regard, Streicher JA stated that:
‘Die aanspreeklikheid van die Staat word uitgesluit ten opsigte van ’n handeling of ’n
late wat voortspruit uit die openbare skool se “kontraktuele verantwoordelikheid as
werkgewer teenoor die personeel aangestel ingevolge subarts (4) en (5)”. In hierdie
geval het die personeellid se handeling of late moontlik voortgespruit uit haar
kontraktuele verantwoordelikheid teenoor die skool maar het duidelik nie voortgespruit
uit die kontraktuele verantwoordelikheid van die skool teenoor haar soos vereis deur die
artikel nie.’34
[25] In the Framesby case,35 Pickering J accepted the submission by
counsel for the plaintiff to the effect that, should s 60(1) exclude the State’s
liability for contractual obligations of a public school, ‘it would have been
unnecessary for the Legislature to have promulgated s 20(10) and, in
particular, to have referred therein to s 60 in the terms it did.’36 Needless to
say, counsel for the School in the present appeal relied on this dictum.
[26] It is indeed so that, if s 60(1) of the Act is interpreted – as in my
view it must be – to apply only to delictual claims, s 20(10) is, at least to a
large extent, rendered superfluous. And this would, of course, go against
the common law ‘presumption’ that a statute does not contain superfluous

33 2006 (1) SA 193 (SCA).
34 Para 13.
35 Supra n 1 at 95D-E.
36 See also the Strauss case, supra n 2 para 21 and the discussion of the Louw case by P J Visser in 2006
(69) THRHR 523.

provisions and that a meaning must be given to every word thereof.37 As
pointed out by this court, however:38
‘[T]he rule is not an absolute one. Tautology is not uncommon in legislation . . . And
the rule must not be applied to create differences of meaning where such differences
were not intended by the lawgiver.’
[27] It could well be that s 20(10) was enacted to make it quite clear that
the State is not liable for any labour-related claim, contractual or otherwise,
brought against a public school by an educator or non-educator employed
by its governing body in terms of ss 20(4) and (5). This was in fact one of
the submissions made by counsel for BFS and appears to be a sound one. In
any event, in the context of the Act as a whole, ‘its apparent scope and
purpose’,39 I do not think that the inclusion of s 20(10) in the Act detracts
in any way from my conclusion that s 60(1) covers only claims in delict
against a public school and does not include within its ambit contractual
claims against the school. In the light of this conclusion, it is not necessary
to engage with the submission by BFS that its claim was for specific
performance of the lease agreement, rather than for ‘damage or loss’, as
contemplated in s 60(1).
[28] It follows that the special plea raised by the School in this regard
should have been dismissed and that, accordingly, this appeal must
succeed.

37 See, for example, Commissioner for Inland Revenue v Golden Dumps (Pty) Ltd 1993 (4) SA 110 (A) at
116 F-117A. See further, Du Plessis op cit para 330 and G E Devenish Interpretation of Statutes (1992)
p211 and the other authorities cited by these authors.
38 In Commissioner for Inland Revenue v Shell Southern Africa Pension Fund 1984 (1) SA 672 (A) at
678D-F.
39 See Jaga’s case, supra n 14 at 662G-H.

Order
[29] In the result, the following order is made:
1. The appeal is upheld with costs.
2. The order of the court below is set aside and replaced with the
following:
‘2.1 The appeal is upheld with costs.
2.2 The order of the magistrate’s court dated 18 April 2005 is
set aside and replaced with the following:
“The defendant’s special pleas are dismissed with
costs.” ’

B J VAN HEERDEN
Judge of Appeal
Concur:
HARMS JA
STREICHER JA
HEHER JA

HURT AJA:
[30] I have read the judgment of Van Heerden JA, but find myself in
respectful disagreement with her interpretation of s 60(1) of the South
African Schools Act 84 of 1996 ('the Act').
[31] There are two crisp questions which require to be considered in
order to decide this appeal. The first is whether the appellant's claim against
the School is a claim for ‘damage or loss’ within the meaning of that
expression in s 60(1). The appellant's contention is that, since the claim is
based directly on a contractual term, it is, effectively, a claim for specific
performance of that term (which takes effect on the fulfilment of a
condition referred to in the contract) and not a claim for 'damage or loss'.
The second is whether s 60(1) is intended to cover claims for damage or
loss arising from contract or whether it is restricted to claims in delict.
[32] Van Heerden JA has summarized the contents of the lex
commissoria (clause 9) of the contract in her judgment.40 I think it would be
of assistance if I were to quote the pertinent portions of the clause. They
read as follows:
‘9.
If [the] User defaults in the punctual payment of any monies as it (sic) falls due
in terms of this Agreement; or fails to comply with any of the terms and conditions of or
its obligations under this Agreement; . . . or abandons the equipment; . . . or breaches
any warranty given in terms of this Agreement; or does or allows to be done, anything
that might prejudice BFS's rights under this Agreement; or the breach of any one of the
agreements41 as constituted shall be deemed, at BFS's election, to be a breach of any or
all agreements effected in terms of this Agreement, then and upon the occurrence of any
of these events BFS may elect without prejudice to any of its rights to:

40 Para 3.

9.1
claim immediate payment of all amounts which would have been payable in
terms of this Agreement until expiry of the rental period stated in the Equipment
Schedule, whether such amounts are then due for payment or not, or
9.2
immediately terminate this Agreement without prior notice, take possession of
the equipment, retain all amounts paid by the User and claim all outstanding Rentals, all
legal costs on the attorney and own client scale and, as agreed, pre-estimated liquidated
damages,42 the aggregate value of the Rentals which would have been payable had this
Agreement continued until expiry of the Rental period stated in the Equipment
Schedule.
9.3
In addition BFS shall be entitled to claim from the User the amount of any
Value Added Tax ("VAT") payable in respect of such damages.
9.4
If the goods are returned to or repossessed by BFS, BFS shall be entitled to
dispose of same in such manner and on such terms and conditions as it may in its sole
discretion determine.’
[33] There is a provision (clause 9.5) relating to interest in the contract
annexed to the particulars of claim which is not clear, but the reference to it
in the particulars43 reads as follows:
'The Defendant would pay the Plaintiff arrear interest on any amount, including
liquidated damages, due by the Defendant to the Plaintiff and such arrear interest would
be calculated from due date of payment or, in the case of damages from the date of
accrual of Plaintiff's right to claim, to date of receipt of payment by the [plaintiff].’
[34] The contract period was five years commencing 1 September 1999
and the School defaulted after the first month. The claim is therefore for
repossession of the rented equipment and 59 months' rental plus VAT.

41 There were six items leased to the school, with one 'master agreement' covering all of them.
42 I have italicized all of the references to 'damages' in this clause for reasons which should become
apparent shortly.
43 Para 4.9.

There is no averment in the particulars of claim as to a formal notice of
cancellation of the agreement to the School. It appears, though, that the
plaintiff relied on its right to terminate the agreement immediately and
without notice in clause 9.2. This seems to follow from the fact that there is
no separate claim for arrear instalments of rental up to the date of
cancellation and the prayer for interest is on the full amount of
R461 318.33 from the date of the first default, 1 October 2000, calculated
at the rate of ‘prime plus 4%’ to the date of payment.
[35] There can be no doubt that these contractual stipulations are
'penalty stipulations' within the meaning of the Conventional Penalties Act,
15 of 1962. Accordingly, a court asked to adjudicate the appellant's claims
in this case (other, of course, than the claims for return of the leased
equipment), would be justified in requiring evidence to satisfy itself that
the penalty was not out of proportion to the prejudice suffered by the
appellant as a result of the School's default.44 Such a procedure would not
be possible in a simple claim for specific performance of a contract. In
these circumstances, I consider that the contention that the claim is purely
for specific performance is a semantic attempt to avoid an obvious
conclusion. I may say that, if the claim had been framed on the basis that
there was a cancellation on a specified date and that, at that date, a
specified amount was owed by the School in the form of arrear instalments,
that portion of the claim may well have been properly described as a claim
for performance of a contractual obligation, but the issue does not arise
here and no more need be said in that connection. As it stands, the whole

44 Smit v Bester 1977 (4) SA 937(A) at 942-943.

claim is one for 'damage or loss' arising out of the School's omission to pay
the instalments when due.
[36] Does s 60(1) of the Act include, within its scope, claims for
contractual damages? The relevant portion of the preamble to the Act states
that:
‘WHEREAS this country requires a new national system for schools which will . . .
promote . . . acceptance of responsibility for the organisation, governance and funding
of schools in partnership with the State . . . .’
[37] Pursuant to this stated intention, in s 16(1) of the Act the
Department of Education delegated the governance and management of
public schools to their governing bodies. Section 36(1) imposed a duty on
the governing body of each school to:
‘ . . . take all reasonable measures within its means to supplement the resources supplied
by the State in order to improve the quality of education provided by the school to all
learners at the school.’
[38] Subsections 37(1) to (3) provide for the establishment of a school
fund into which the governing body is required to deposit all money
received in the form, inter alia, of school fees, voluntary contributions and
donations. Subsection (6) provides that:
‘The school fund, all proceeds thereof and any other assets of the public school must be
used only for –
(a)
educational purposes, at or in connection with such school;
(b)
educational purposes, at or in connection with another public school, by
agreement with such other public school and with the consent of the Head of
Department;
(c)
the performance of the functions of the governing body; or

(d)
another educational purpose agreed between the governing body and the Head
of Department.’
[39] The governing body is required to prepare a budget ahead of the
commencement of each school year and present it to the parent body for
approval.45 This budget is used as the basis for setting the fees for the
coming year and the parent body is required, specifically and separately, to
approve the proposed fees.46  It is against this procedural background that
the governing body, in consultation with the general parent body, computes
the expenditure for the coming year and fixes the fees which will have to
be levied to meet it.
[40] Looked at from this perspective, the purpose behind s 60(1)
becomes plain. It is highly unlikely (if it is conceivable at all) that a school
budget would contain a contingency provision for loss or damage arising
out of an act or omission which had not, at the time of framing the budget,
been foreseen. It can be predicted, therefore, that a claim of this type, if
successful, would give rise to a shortfall in the budgeted funds. Nor could
such a claim be satisfied by payment out of a school fund, since it could
hardly be described as a payment 'for educational purposes' as prescribed in
s 37(6)(a) of the Act. In the light of these considerations, it seems to me
that the purpose behind s 60(1) is that the MEC will step into the shoes of a
school in order to accept liability for claims for loss or damage arising from
acts or omissions not budgeted for. Is there any reason why the legislator
would have intended this to happen only in cases where the 'act or
omission' is negligent, giving rise to delictual liability, as opposed to a
breach attracting liability under a contract? There is none that I can think

45 Section 38.

of. Nor, in my view, does a consideration of the Act as a whole give any
indication of such an intention.
[41] The argument presented on behalf of the appellant placed heavy
emphasis on what was referred to as the 'delictual flavour' of the expression
'act or omission'. Although the expression is, understandably, regularly
encountered in relation to claims in delict, it is by no means uncommon in
the contractual context. The legislator has used it in this context in a
number of statutes, such as ss 1 and 2 of the Conventional Penalties Act,
s 4(4) of the National Credit Act 34 of 2005, s 12(5) of the Alienation of
Land Act 68 of 1981 and s 5(2) of the Property Time-Sharing Control Act
75 of 1983. The expression is used in s 20(10) of the Act itself. In these
circumstances it seems to me that little weight can be attributed, in
construing s 60(1), to the fact that the legislature has used an expression
which is regularly encountered in the delictual context, since that
expression is by no means exclusive to that context.
[42] The crucial provision which indicates that both delictual and
contractual liability are contemplated in s 60(1) is to be found in s 20(10),
which reads:
‘Despite section 60, the State is not liable for any act or omission by the public school
relating to its contractual liability as the employer in respect of staff employed in terms
of subsections (4) and (5).’47
[43] I cannot accept that this is a simple case of legislative tautology.
The words ‘despite section 60’ cannot be ignored and, in my view, the only

46 Section 39.
47 Staff employed by the governing body in addition to the staff allocated by the Department of
Education.

sensible import which can be given to them is that the particular form of
contractual liability arising from a school's capacity as an employer cannot
be enforced against the State. The inevitable corollary must be that the
State is otherwise liable in terms of s 60(1), in appropriate circumstances,
for loss or damage arising from an act or omission relating to contractual
obligations other than those provided for in s 20(10).48
[44] It follows that I take the view that the appellant's claim should have
been brought against the MEC and not the School and that the magistrate in
the court of first instance was correct in upholding the special plea on this
basis.

N V HURT
Acting Judge of Appeal

48 This was the specific finding of Pickering J in the case of Technofin Leasing & Finance (Pty) Ltd v
Framesby High School 2005 (6) SA 87 (SE). I agree with the reasoning reflected in that judgment.
THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

From:
The Registrar, Supreme Court of Appeal

Date:
Friday 30 May 2008

Status:
Immediate

Please note that the media summary is intended for the benefit of the media
and does not form part of the judgment of the Supreme Court of Appeal

Bastian Financial Services (Pty) Ltd v General Hendrik Schoeman
Primary School

The Supreme Court of Appeal (SCA) today upheld an appeal by Bastian Financial
Services (Pty) Ltd (BFS) against a decision of the Pretoria High Court which held that
the General Hendrik Schoeman Primary School (the School) was not liable to it for
damages for breach of a contract allegedly entered into between them.

The School had leased photocopier equipment from BFS for a period of five years
and failed to pay the instalments due under the lease agreement. BFS cancelled that
agreement and sued the School, claiming return of the equipment and payment of
the total rentals which would have been payable had the agreement run its course.
The School opposed the action, denying that it was in breach of the contract and
maintaining that it was BFS that had breached the contract. The School also raised a
special plea to the effect that BFS had sued the wrong party. Its case was that, in
terms of section 60(1) of the Schools Act 84 of 1996, the State was liable for claims
for both delictual and contractual damages arising from acts or omissions in
connection with any educational activity conducted by a public school. The School
contended that it was therefore indemnified against BFS’ contractual claim, which
should have been instituted against the MEC for Education of the North West
Province.

Both the magistrate’s court and the High Court agreed with the School’s
interpretation of section 60(1) and upheld the special plea. On appeal to the SCA, the
majority of this Court (four judges concurring, one judge dissenting) pointed out that a
public school itself, and not the State, is liable for the performance of the school’s
contractual obligations – the other party to the contract cannot rely on some sort of
‘warranty’ by the State that the school will perform its obligations under contracts
which have been lawfully entered into. The SCA held that it would be contrary to the
purpose and scheme of the Schools Act as a whole to interpret section 60(1) in a
manner so as to shift to the State liability for damages flowing from the breach of a

contract lawfully entered into by a public school. Section 60(1) must be interpreted to
apply only to delictual claims and the special plea raised by the School should have
been dismissed. For this reason, the appeal succeeded.

ends ……….