Sibandze v Senteo Digital (Pty) Ltd and Another (A2023-129937) [2025] ZAGPJHC 1180 (20 November 2025)

Case Note

Tshepiso Kennedy Sibandze v Senteo Digital (Pty) Ltd and Zeenat Mohamed Mothaj
(1) REPORTABLE: Yes (2) OF INTEREST TO OTHER JUDGES: Yes
Date: 02 September 2025

Reportability

This case is reportable due to the significant legal principles it establishes regarding the nature of payment arrangements between parties in a business context, especially in the absence of formalized contracts. The court's decision highlights the importance of understanding the terms of employment versus loan arrangements, and the implications of mislabeling financial transactions. The case may serve as a precedent for future disputes where payment references may be contested, emphasizing the necessity for clarity and documentation in business dealings.

Cases Cited

1. Special Investigating Unit v Phomella Property Investments (Pty) Ltd and Another [2023] ZASCA 45; 2023 (5) SA 601 (SCA)
2. National Employers' Mutual General Insurance Association v Gray 1931 AD 187
3. Stellenbosch Farmers' Winery Group Ltd and Another v Martell & Cie SA and Others [2002] ZASCA 98; 2003 (1) SA 11 (SCA)
4. Santam Bpk v Biddulph [2004] ZASCA 11; [2004] 2 All SA 23 (SCA)

Legislation Cited

• Companies Act 71 of 2008: Discussion regarding the legal requirements for a company to lend money to its directors.

Rules of Court Cited

No specific rules of court were cited in the judgment.

HEADNOTE

Summary

The appeal centred on whether R20,000 monthly payments made to the appellant from August 2018 to November 2019 constituted a loan or salary. The Regional Court had ruled in favor of the respondents, requiring the appellant to repay the amount as a loan. The appeal court assessed the evidence, including WhatsApp communications and financial documents, leading to the conclusion that the payments were misclassified as a loan.

Key Issues

1. The nature of the payments made to the appellant—were they a loan or a salary?
2. The credibility of the witnesses concerning the interpretation of financial transactions.
3. The implications of the absence of a formal agreement memorializing the terms of engagement.

Held

The court found that the payments made to the appellant were misquoted as a salary rather than a loan. The appeal was upheld, dismissing the respondents' claim, highlighting the need for substantial evidence to support assertions regarding financial arrangements.

THE FACTS

The appellant, Tshepiso Kennedy Sibandze, was involved with Senteo Digital (Pty) Ltd, led by the first respondent, Zeenat Mohamed Mothaj. The controversy arose from R20,000 monthly payments made to the appellant between August 2018 and November 2019. The respondents contended these payments were loans, while the appellant argued they were his salary for services rendered as a web developer.

The second respondent, Mohamed, testified about the informal nature of their business partnership and suggested that the payments initially labeled as salary were due to a lack of accounting knowledge. They argued that the company was not profitable during this time and thus could not issue formal salaries.

The conversation documented via WhatsApp served as a crucial piece of evidence, revealing the discussions held between the second respondent and the appellant regarding monthly payments. The respondent’s narrative suggested that the terms of payment had changed with the changing business circumstances.

THE ISSUES

The primary legal question was whether the payments made to the appellant were to be classified as a salary or a loan. This inquiry necessitated an examination of the intentions of the parties at the time of the agreements, the context of business operations, and whether any legal principles or precedents should apply.

The court also needed to assess the credibility of the witnesses and the consistency of their testimonies, especially given the lack of formal written contracts or agreements. The interpretation of the WhatsApp communications and how they reflected on the nature of the transactions was also a central issue.

ANALYSIS

The court meticulously analyzed the communications between the parties. It noted that the term "salary" had been used consistently for several months before the change to "loan," which the court deemed suspicious and indicative of an intention to mislead regarding the true nature of the payments.

The court expressed concern over the inconsistencies in the testimony of the respondents. It noted that the second respondent’s claim of a typographical error was contradicted by the facts presented—the payments had always been referenced as salary until they were revised without clear justification. The explanation that they were merely operating without sufficient business acumen was also found lacking, given that the second respondent had relevant experience in the field.

Further scrutiny revealed that the ongoing lack of formal agreements connected to salary payments raised significant questions about the legitimacy of the claimed loan, particularly in light of the Companies Act requirements regarding loans to directors. The court concluded that the lack of adherence to these statutory requirements signified that the payments were indeed salary rather than loans.

REMEDY

The appeal court upheld the appeal, setting aside the previous order of the Regional Court. It dismissed the respondents' claim for repayment and ordered that they bear the costs of the appeal, including the fees of counsel.

LEGAL PRINCIPLES

This case reinforces the principle that in the absence of clear, compelling evidence, the burden of proof rests on the party making the assertion—in this case, the respondents needed to prove that the payments constituted loans. It underscores the necessity of having written agreements in business transactions to avoid confusion and misinterpretation. The case also illustrates the significance of witness credibility and the consistency of testimony in determining the outcome in disputes over contractual intentions.

Moreover, it reiterates that references on financial documents must be substantiated by clear intention and mutual consent; ambiguous terms can lead to misunderstandings that ultimately affect the rights and obligations of the parties involved.