About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Western Cape High Court, Cape Town
SAFLII
>>
Databases
>>
South Africa: Western Cape High Court, Cape Town
>>
2016
>>
[2016] ZAWCHC 112
|
|
Trust Hungary RZT v Vincorp (Pty) Ltd (A584/14) [2016] ZAWCHC 112 (2 September 2016)
THE
HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
In
the matter between
Case No: A584/14
TRUST
HUNGARY RZT
APPELLANT
And
VINCORP
(PTY) LTD
RESPONDENT
Coram
:
ERASMUS, SAMELA & ROGERS JJ
Heard:
25 JULY 2016
Delivered:
2 SEPTEMBER 2016
JUDGMENT
ROGERS
J (ERASMUS & SAMELA conc):
Introduction
[1]
The appellant (‘THR)
appeals with the leave of the trial judge, Van Staden AJ, against the
dismissal of its action against
the respondent (‘Vincorp’).
THR’s claim is for the purchase price of wine barrels sold and
delivered. In its
particulars of claim THR alleged that since about
2002 Vincorp had been ordering and purchasing barrels from it in
terms of written
purchase orders. The claim concerned barrels
allegedly ordered by Vincorp during 2008-2009.
[2]
There is no dispute
that THR manufactured the barrels and that they duly arrived in South
Africa. Vincorp pleaded, however, that
it was not the party which
purchased the barrels. That was the issue before Van Staden AJ. He
found against THR, concluding that
the buyer had been VinCo CC, a
corporation controlled by one Pretorius. Although the latter entity
is referred to in documents
and evidence as VinCo, I shall use the
name VCC to avoid confusion with Vincorp. There was a commercial
relationship between VCC,
THR and Vincorp. There is no corporate
connection between them.
[3]
In the trial THR was
represented by Mr Carstens SC and Vincorp by Mr van Rooyen SC. In the
appeal Mr McLarty SC appeared for THR
while Mr Van Rooyen SC again
appeared for Vincorp.
Factual
background
[4]
In the latter part of
2001 THR wanted to expand its sales in South Africa and ran various
advertisements. Pretorius, whose corporation
VCC was a barrel agent,
made contact with THR’s managing director, Molnar. Pretorius
visited Hungary. THR agreed to appoint
VCC as its South African sales
representative. The initial arrangement was that THR would invoice
VCC and the latter would in turn
invoice its South African customers.
VCC had to pay in advance for any orders placed on THR. VCC was not
cash-flush and had to
borrow money to make these payments.
[5]
Vincorp provided
financing and logistical services for the importation and supply of
wine barrels. At the beginning, when VCC had
to make advance payments
to THR, Pretorius used Vincorp for outward transfers to THR because
Vincorp had a foreign-currency account.
This was merely a banking and
administrative function. In mid-2002 VCC and Vincorp discussed an
expansion of Vincorp’s role.
On 28 August 2002 Paul Haumann,
Vincorp’s financial manager, wrote to Pretorius setting out the
services which Vincorp could
offer VCC for the importation of barrels
from Hungary. These included the following. Vincorp would (i) place
orders with THR
on the basis of orders Vincorp received from VCC;
(ii) arrange importation from Hungary to South Africa;
(iii) complete
all documentation and ensure compliance with
foreign and South African law; (iv) take out insurance for the
duration of the
logistical process; (v) take out forward cover
at VCC’s request; (vi) make outward payments to THR on
behalf of
VCC; (vii) attend to customs clearance. For these
services Vincorp would charge VCC 2,5% on the total amount invoiced
by Vincorp
to VCC.
[6]
It is clear from the
documents in the record that the amount on which Vincorp levied its
2,5% fee was the sum of THR’s ex-warehouse
price for the
barrels plus shipping, clearing and importation costs. Vincorp’s
invoice to VCC would thus be the sum of these
various amounts and the
2,5% fee. In this way Vincorp would recoup the price of the barrels
paid to THR, logistical costs and its
fee. (Curiously no invoices
issued by Vincorp to VCC were produced at the trial. Haumann said
they would be in a cupboard somewhere.)
[7]
Haumann’s letter
concluded by stating (i) that Vincorp would make no payments to
the manufacturer before it obtained
funds from VCC; (ii) that
Vincorp only performed a logistical function and assumed no
responsibility for the quality of the
barrels; (iii) that if
VCC’s clients wanted finance, Vincorp’s rental option was
available, in regard to which
each case would be considered on its
merits in terms of Vincorp’s credit policy.
[8]
Pretorius accepted the
terms contained in the letter which thus constituted a contract
between Vincorp and VCC. Haumann testified
that this was typical of
Vincorp’s arrangements with barrel agents. The letter, which
was in Afrikaans, was not seen by Molnar.
[9]
Molnar visited South
Africa in September/October 2002. Pretorius took him to various wine
estates. Pretorius also introduced him
to Vincorp’s Ilse
Liebenberg, a logistics clerk. There is a factual dispute about the
meeting. Pretorius and Liebenberg (whose
surname by the time of the
trial was De Waal) testified that it was a courtesy call so that
Molnar could meet the person who would
be handling the logistics.
Molnar testified that the three of them met at a restaurant in
Stellenbosch where substantive business
was discussed.
[10]
What is clear is that
Pretorius wanted Vincorp to supply him with a letter to VCC. On 7
October 2002 Liebenberg sent him a draft.
Her covering note said that
she did not know exactly what Pretorius wanted the letter to say and
that if he had changes he should
furnish them to her before she
dispatched the letter. It appears that Pretorius was satisfied with
the draft because on 9 October
2002 he sent it to Molnar under cover
of a note stating:
‘
As
discussed with you earlier, dealing through Vincorp will be the best
option and will be for mutual benefit to [THR] and [VCC].
If you have
any questions, you are more than welcome to contact them direct.’
Pretorius included Liebenberg as a recipient of this
note and its attachment.
[11]
The caption of the
attached letter, purporting to be by Liebenberg on behalf of Vincorp
to THR’s Molnar, was ‘ Payment
terms’. The first
paragraph referred to ‘our indent B301/578 for the KWV’.
This document is not in the record
but is probably an order for
barrels for KWV. The letter ‘B’ features in all the
Vincorp orders appearing in the record.
The word ‘indent’
in a business context refers to an order for goods, usually an order
for foreign goods placed through
a local agent.
[12]
The substantive content
of the letter appeared under the heading ‘Background
information’ and reads thus:
‘
We
do the procurement and financing of oak barrels in the South African
wine industry. Vincorp has been in operation for the past
3 years and
has procured and financed ± 50% of all new barrels for the
South African market during the previous season.
We have
long-standing relationships with all the large French cooperages and
deal directly with them on a daily basis. They prefer
to deal with
Vincorp because once we have made the credit decision they are
ensured of payment. It is important to note that we
are not barrel
agents, we only do the procurement and financing of the barrels. Due
to our well established infrastructure and
the related cost savings
for our client, we generally prefer to deal directly with the foreign
cooperages. We offer a one stop
service that includes, order of
barrels, procurement and logistics, forward cover, financing and away
payment of foreign amounts.
Please
confirm the payment terms. We normally order
exw
and payment
is due 60 days after bill of lading.’
The
letter concluded by listing Australian and French references for
Vincorp. The letters ‘
exw
’
in the last sentence in the quoted
passage stand for ‘ex-warehouse’. What the sentence thus
conveys is that Vincorp
normally orders at the price charged by the
manufacturer for collection of the product at the manufacturer’s
premises and
that it pays this price to the manufacturer 60 days
after the date of the bill of lading.
[13]
Molnar testified that
this letter accorded with what Liebenberg said at the meeting and
that the letter was handed to him at or
around the time of the
meeting. Although the immediate context of the letter may have been
an order for KWV, he understood the
explanation to be of general
application in THR’s future dealings with Vincorp. The
background, he said, was that South African
sales were expected to
grow. South African wine estates usually placed their orders for
imported barrels in October. VCC did not
have the resources to fund
the advance payments for THR’s barrels and THR was not willing
to give it credit. By contrast
the information about Vincorp
furnished to him by Pretorius and Liebenberg showed that Vincorp was
a company of substance with
a track record. He had contacted some of
the foreign cooperages to check Vincorp’s credentials. He was
satisfied. The arrangement
going forward would thus be that Vincorp
would order the barrels and be responsible for payment.
[14]
Haumann testified that
he was unaware of Liebenberg’s letter until the dispute about
non-payment arose in late 2009. According
to him she was not
authorised to conclude contracts on Vincorp’s behalf. He said
that he himself did not have any contractual
negotiations with THR
though he was party to various emails relating to the logistics of
importing barrels from THR.
[15]
Liebenberg’s
evidence was that she had no authority to conclude contracts. She
denied having discussed business with Molnar.
By the time she met him
briefly in October 2002 she was aware of Haumann’s letter to
Pretorius dated 28 August 2002 because
she was involved in
implementing Vincorp’s logistical services to VCC. She could
not recall why Pretorius wanted the letter.
She knew that he would be
sending it to Molnar. When asked why she had written an unauthorised
letter, she said she thought she
was just explaining how the process
would work in relation to KWV orders.
[16]
The trial judge formed
an unfavourable opinion of Pretorius and counsel did not ask us to
place reliance on his evidence. I shall
thus not refer to it. Molnar,
Haumann and Liebenberg all made a favourable impression on the trial
judge as did two other witnesses
called by THR, Ms Ruppert and Ms
Kope. Van Staden AJ did not think any of them was trying to mislead
the court. They were testifying
about events which stretched back
nearly 12 years in regard to a commercial relationship which had only
gone sour about seven years
after the relationship began. In regard
to the Stellenbosch meeting, he thought the inherent probabilities
favoured Liebenberg’s
version and that Molnar was mistaken,
perhaps with the passing of time having become convinced in his own
mind of what took place.
He found in any event that Liebenberg was
not authorised to bind Vincorp.
[17]
My impression on
reading the transcript is that the trial judge was somewhat
charitable in his assessment of Haumann and Liebenberg.
However I
think it is unnecessary to decide whether we would be entitled to
interfere with his factual findings. I shall proceed
on the basis
that THR failed to discharge the burden of proving Molnar’s
version of the meeting. I also accept that Liebenberg
was not
authorised to bind Vincorp. Indeed THR did not refer to the letter of
7 October 2002 in its pleadings.
[18]
The fact that
Liebenberg was not authorised to bind Vincorp and that THR did not
place reliance on the letter in its pleadings does
not mean that the
letter is irrelevant. The entire history between the parties,
including the circumstances surrounding the letter,
was exhaustively
examined in the court a quo. No objection to any of the evidence was
taken. Although the letter itself did not
constitute a contract, it
contains a factual description, by one who could be expected to know,
of how Vincorp operated. That is
a relevant circumstance in assessing
the conduct of the parties and how their subsequent actions should
reasonably be understood.
[19]
As a fact, what
happened as from the latter part of 2002 is that Vincorp issued
documents in the form of orders placed on THR. These
order forms were
transmitted to THR, either by Vincorp directly or through VCC. In
some instances Vincorp’s orders were recast
by Pretorius
according to a template approved by THR but without alteration to the
substance of Vincorp’s original orders.
The Vincorp orders,
addressed to VCC, identified Vincorp as the consignee. The shipper
was identified as Röhlig, being the
shipper arranged by Vincorp.
The order forms specified that THR was to supply three sets of
commercial invoices. The original documents
were to be sent to
Vincorp. The order made provision for signature on behalf of Vincorp
and for acceptance by the cooper (ie THR).
The orders were generally
signed by Liebenberg for Vincorp and by Molnar or others for THR
though signed acceptance does not seem
to have been an invariable
practice.
[20]
Upon receipt of an
order, THR issued a ‘manufacturing order and confirmation’.
The purpose of the manufacturing order
was to confirm that THR was
proceeding to manufacture barrels in accordance with the order placed
on it. There are no manufacturing
orders in the record dating back to
the early stages of the relationship but Liebenberg confirmed that
THR sent them to Vincorp.
The manufacturing orders contained the
following inserted information: ‘Bill to’ –
Vincorp; ‘Ship to’
– VCC; ‘Customer ID’
– VCC/Pretorius. Particulars of the barrels ordered were set
out in a table. The final
column of the table recorded the name of
the wine estate for which the barrels were intended and Vincorp’s
order number.
The manufacturing order contained the following note at
the foot:
‘
Please
advise within 24 hours in case of any additional comments about this
confirmation, otherwise your order confirmed and valid!’
[21]
Upon shipment the
barrels were accompanied inter alia by THR’s invoice issued to
Vincorp and a packing slip identifying the
customer as Vincorp and
listing the latter’s order numbers. The bill of lading
identified Vincorp as the consignee. The bill
of entry, used for
customs clearance in South Africa, named Vincorp as the importer and
THR as the supplier.
[22]
All payments for
imported barrels were made by Vincorp to THR.
Change in
invoicing?
[23]
In fairness to Vincorp
I must note that during 2003 there seems to have been a deviation
from the above practice. This appears from
an email exchange between
Pretorius and one Roland of THR over the period 29 January – 2
February 2004 in which Pretorius
requested that all invoices be
addressed to Vincorp. He asked Roland to change the invoices for the
three containers already received
and which had been addressed to
VCC. Roland apologised but said that THR’s accounts department
was unable to change the three
invoices already issued. Pretorius
persisted, saying that it was important to make the change for the
following reasons: (i) that
Vincorp was a separate company of
which he, Pretorius, was not a director; (ii) that Vincorp acted
as a financing company
and importing agent on VCC’s behalf;
(iii) that Vincorp was responsible for all payments to THR.
[24]
I do not think anything
adverse to THR’s alleged understanding of the contractual
position can be inferred from the above
email correspondence. The
trial judge found that until this email exchange all the THR invoices
had been addressed to VCC. Although
that is what Haumann suggested in
oral evidence, it is at odds with Pretorius’ email of 2
February 2004 which concluded with
a statement that hitherto THR had
addressed its invoices (ie correctly and in contra-distinction to the
three invoices about which
he was complaining) to Vincorp, not VCC.
However unreliable Pretorius may have been as a witness, it is most
unlikely that this
contemporaneous statement was incorrect. There was
no reason at the time for Pretorius to make a false assertion and he
would have
known that THR could easily ascertain whether what he was
saying was right or wrong.
[25]
From Pretorius’
email it thus is apparent that initially THR’s invoices were
issued to Vincorp in accordance with the
orders placed by the latter.
For unexplained reasons there was a deviation in the latter part of
2003 in respect of three orders.
This may well have been nothing more
than an oversight by THR’s accounts department or a mistake
occasioned by the similarity
between the names VinCo and Vincorp.
Things then returned to normal, and the consistent practice
thereafter was that THR issued
its invoices to Vincorp.
Different
classes of customers?
[26]
Haumann’s
evidence was that there was an important distinction between
Vincorp’s existing customers and VCC’s
customers. In the
former category, according to Haumann, were KWV, Distell and the
Lusan group.
[1]
For convenience I shall refer to these as ‘ Vincorp customers’
and ‘VCC customers’ respectively. His version
was that
Vincorp was liable to THR for orders relating to Vincorp customers
but not for orders relating to VCC customers.
[27]
In respect of VCC
customers, Haumann testified that Vincorp merely rendered logistical
services to VCC in accordance with the letter
of 28 August 2002.
Although Vincorp made payments to THR in respect of VCC customers as
well as its own customers, it only did
so in the case of VCC
customers upon receipt of the money from VCC. This was an arrangement
of convenience because Vincorp had
a foreign-currency account with
FNB and the facilities for obtaining forward exchange cover. In the
case of VCC customers, Vincorp’s
‘orders’ were not
true orders – they were generated merely to ensure that the
barrels were entered into Vincorp’s
system so that they could
be tracked for logistical purposes. There was a similar explanation
for the requirement that THR’s
invoices be issued to Vincorp
rather than VCC: FNB insisted that invoices correspond with the bills
of lading and bills of entry.
[28]
As I have already
observed, Molnar was not aware of the letter of 28 August 2002. He
testified that he was never made aware that
Vincorp’s position
was that it would only pay THR upon receipt of money from VCC. He
also denied knowing anything of the
supposed distinction between
Vincorp customers and VCC customers. Whether any distinction was
drawn in the documentation which
passed between Vincorp and VCC is
not altogether clear. Haumann gave very confusing evidence about the
way Vincorp and VCC should
have accounted for the transactions
between them, procedures which he said were often not followed
because of Pretorius’
administrative disarray. Despite careful
reading I am not sure I have followed Haumann’s explanations.
Be that as it may,
these matters were not visible to THR. Insofar as
THR was concerned, no distinction was drawn, in the documentation
which came
into existence, between customers who were supposedly
Vincorp customers and those who were supposedly VCC customers.
Vincorp’s
orders were identical as were the documents issued by
THR.
[29]
There was no reliable
evidence to gainsay Molnar’s version of how matters appeared to
him. The impression created by Vincorp’s
orders, its receipt
without objection of invoices issued to it by THR, and by Vincorp’s
payment for all barrels supplied
pursuant to those invoices, was
consistent with the way Molnar says he understood Liebenberg’s
letter of 7 October 2002.
Although Liebenberg admitted writing the
letter, she denied ever discussing substantive business with Molnar.
Haumann likewise
denied ever having discussed contractual
arrangements with Molnar. It follows that on Vincorp’s own
version nothing was ever
communicated to Molnar to place the
commercial documentation in a different light or to draw the
distinction between Vincorp and
VCC customers. I leave aside
Pretorius’ evidence, which as noted was found to be unreliable
in general.
[30]
During argument we
invited Mr van Rooyen SC to explain how Vincorp’s contractual
liability to THR in respect of Vincorp customers
arose if, as its
witnesses testified, there were no contractual discussions between
Vincorp and THR. He was not able to point to
anything beyond
Vincorp’s orders – documents which in form were identical
to those issued by Vincorp in respect of
VCC customers.
[31]
There was email
correspondence between Vincorp and THR from time to time regarding
the practical implementation of Vincorp’s
orders. In none of
these emails is a distinction drawn between classes of customers or
any suggestion that the orders were anything
other than what they
purported to be. For example in January 2007
Jeanell
Mostert of Vincorp emailed THR
explaining that when Vincorp placed an order at the agent (ie THR’s
agent VCC), a contain number
appeared on the order and that this was
very important because Vincorp grouped containers so as to control
estimated arrival dates
and thus meet its customers’ delivery
requests. Vincorp also took out insurance and forward cover for its
customers. THR
was asked not to re-group barrels without first
contacting Vincorp.
[32]
In January/February
2009 there was email correspondence between Haumann, Ruppert and
Pretorius to make sure that they all had the
same information about
Vincorp’s orders. In the schedule attached to Haumann’s
email of 8 January 2009 THR was asked
to use the list to verify that
all orders had been received. On 22 January 2009 Ruppert emailed to
say that she was missing certain
orders. Haumann replied saying that
all the processed orders had been sent to Pretorius and asking
whether Ruppert wanted him to
send the orders to her as well. She
replied in the affirmative. On 22 January 2009 Ruppert asked Haumann
if he still had orders
for THR, since this might justify a third
container. He replied that she had all Vincorp’s orders. 2
February 2009 Haumann
emailed Ruppert attaching a summary of the
orders Vincorp had processed to date. From the schedule attached to
the email of 8 January
2009 and from the content of some of the
emails one can see that the orders related to both classes of
customers identified by
Haumann. As I have said, no distinction was
drawn.
Commercial
probabilities
[33]
Molnar’s
understanding is inherently plausible from a commercial perspective.
In the early days, before Vincorp’s involvement,
THR sold
barrels to VCC but required it to make advance payment (this would
have applied to the relatively small volumes which
Pretorius bought
in the latter part of 2001 and early 2002). Nobody has suggested that
VCC was an entity to which THR could reasonably
have been expected to
extend credit. This made the expansion of THR’s sales in South
Africa problematic. Vincorp thus became
involved as the season
approached for the placing of fresh orders in the latter part of
2002. If THR had understood the position
to be that Vincorp would not
make payment unless it received the money from VCC, THR would have
had to rely on VCC’s creditworthiness.
That was the very thing
THR was unwilling to do. Liebenberg’s description of Vincorp’s
status in the letter of 7 October
2002, together with the references
furnished, would have given Molnar comfort that Vincorp was a company
of substance. Even if
Liebenberg was not authorised to write the
letter, nobody suggested that what she said about Vincorp was
factually incorrect.
The
September 2007 circular
[34]
THR also led evidence
concerning a circular which Vincorp addressed to its suppliers and
agents in September 2007. THR and VCC were
among a group of email
recipients. In the circular Vincorp clarified its invoicing
requirements. Invoices from suppliers (THR was
a supplier) had to
contain Vincorp’s order reference number and the name of
Vincorp’s client. If this was not done,
Vincorp could not
allocate costs and this might lead to delay in payment. After setting
out certain other documentary requirements,
Vincorp said that payment
would be made 30 days after (i) full delivery of the barrel
order; (ii) receipt of an original
invoice made out in Vincorp’s
name; (iii) confirmation from the client that the barrels were
in good order. The circular
concluded by stating that to avoid
misunderstanding Vincorp did not accept any orders from agents on
behalf of clients. My understanding
of the latter statement is that
Vincorp would not accept responsibility for orders supposedly placed
by agents on its behalf with
suppliers.
[35]
Molnar testified that
the circular did not contain a qualification that Vincorp would only
make payment to suppliers once it had
received money from the
customers or agents. When asked about this, Haumann said that it was
a general circular sent out at the
beginning of the season and was
not intended to cover all scenarios, only the scenario applicable to
most agents and suppliers.
Establishing
contractual consensus
[36]
It has long been
accepted in our law that a person cannot escape from an apparent
agreement merely because his subjective intention
differed from the
apparent agreement. This is known as the doctrine of quasi-mutual
assent. In
Sonap
Petroleum (SA) (Pty) Ltd v Pappadogianis
1992
(3) SA 324
(A) at 239F-240B the court said that in various earlier
decisions our courts had adapted, for purposes of the facts of their
respective
cases, the well-known dictum of Blackburn J in
Smith
v Hughes
(1871) LR
6 QB 597
at 607:
‘
If,
whatever a man’s real intention may be, he so conducts himself
that a reasonable man would believe that he was assenting
to the
terms proposed by the other party, and that other party upon the
belief enters into the contract with him, the man thus
conducting
himself would be equally bound as if he had intended to agree to the
other party’s terms’.
See also, for
example,
Pillay & Another v Shaik & Others
2009 (4) SA
74
(SCA) paras 55-60; and see Christie
The Law of Contract in
South Africa
6
th
Ed at 10-12; 24-30.
[37]
Although this doctrine
may have its roots in estoppel, it appears now to have an independent
existence (Christie op cit 28-30),
expressing the essentially
objective nature of the enquiry into whether there is consensus,
namely that the law does not concern
itself with the working of the
minds of the parties to a contract but with the external
manifestations of their minds (see
SAR
& H v National Bank of SA Ltd
1924
AD 704
at 715;
Makata
v Vodacom (Pty) Ltd
2016
(4) SA 121
(CC) paras 72-73 per the majority and para 157 per the
minority). The learned trial judge erred, in my respectful view, in
stating
that a party raising quasi-mutual assent must plead it.
[38]
The external
manifestations of the parties’ conduct over the period
2002-2009 was such that a reasonable person would have
understood
there to be consensus between them that Vincorp was buying barrels
from THR in accordance with orders placed by the
former and invoices
issued by the latter. This is how commercial documents of this kind
would normally be understood.
[39]
If both parties to a
supposed contract subjectively know that the external manifestations
of their conduct are not to be taken at
face value the court will
naturally not insist that there is a contract contrary to their
actual state of mind (see Christie op
cit 25). But the evidence and
documentation to which I have referred satisfy me that THR
subjectively understood the external manifestations
of the
interactions between itself and Vincorp in a manner consistent with
its pleaded case, namely a series of sale agreements
in accordance
with Vincorp’s orders. The trial judge found that this was
Molnar’s sincere belief but that THR and Vincorp
were ‘at
cross-purposes’.
Extension
of time for payment
[40]
There are two further
pieces of evidence with which I must deal. The first is that on 28
October 2003 Pretorius emailed Molnar to
say that it was barrel order
time again in South Africa. He asked whether Molnar would extend his
payment terms from 60 days to
90 days after loading. He wrote again
on 31 October 2003 to say that he was processing his orders and
asking for a response to
his request, adding that he needed to
arrange forward cover according to payment dates. Molnar replied that
he would agree to the
90-day term.
[41]
Mr van Rooyen submitted
that this email exchange evidenced an understanding that VCC rather
than Vincorp was the purchaser of the
barrels. I do not think that in
all the circumstances the submission is well-founded. In motivating
his request for an extension
to 90 days, Pretorius specifically
referred inter alia to the fact that KWV and Distell only paid him 30
days after delivery in
South Africa. KWV and Distell were so-called
Vincorp clients, in relation to whom Vincorp accepted in the court a
quo that it was
contractually liable to THR. The Vincorp orders
stated that it would make payment to THR within 60 days after
loading. It is common
cause that the party which actually made the
payments was Vincorp. One can understand, commercially, that Vincorp
would have had
back-to-back payment terms with VCC. So if THR was
willing to extend the 60 days to 90 days, this benefited VCC.
November
2009 correspondence
[42]
The other piece of
evidence concerns the communications which took place between THR and
Vincorp when the former was pressing for
payment of the 2008/2009
orders. On 24 November 2009 Kope emailed Haumann noting that Vincorp
had an outstanding balance of $112 726
and asking when Vincorp
would pay. Haumann replied that THR should contact its ‘agent’
in South Africa, Pretorius,
adding that Vincorp ‘only did the
logistics’ for THR and that Vincorp’s relationship with
THR had always been
that Vincorp only settled once Pretorius paid
Vincorp. He said this had always been the case in the past. Kope
replied that she
‘was aware of the arrangements’ but had
noticed that the last payment received by THR was a month before and
just wanted
to know if there was any chance of receiving another
payment soon. She asked whether Haumann had any information based on
his correspondence
with Pretorius. Haumann did not reply. (Haumann
had been writing with increasing frustration to Pretorius over the
period August-November
2009, his last email being 5 November 2009 in
which he said that he did not know what more to do, that Pretorius
was making things
very difficult and awkward for Vincorp and that
Vincorp really wanted to sort out the situation with THR.)
[43]
On 1 December 2009
Molnar wrote to Haumann saying that he had not had the opportunity to
meet him but had dealt extensively with
Liebenberg. Over the past six
years Vincorp had paid for barrels from THR but had failed to do so
in the current year. He had reviewed
the orders. Numerous emails and
past practice confirmed that Vincorp was the importer of the barrels.
He said he could probably
accommodate Vincorp if it required a
payment plan, otherwise Vincorp was to remit payment in full. And so
battle lines were drawn.
Vincorp’s reply was written by its
managing director, probably with legal input.
[44]
Unsurprisingly Mr van
Rooyen in the court a quo and in this court placed considerable
reliance on Kope’s apparent acknowledgment
of the arrangement
described by Haumann in his email of 24 November 2009. In his
evidence Molnar used strong language in expressing
his view of
Haumann’s email – ‘a despicable mistake’,
‘categorically false’, ‘a cruel
joke’,
‘absolutely absurd’. He testified that Kope, who did not
work for THR but an associated company TIC and
was based in the
United States, was not familiar with the arrangements. She had only
joined TIC in 2005. He had not instructed
Kope to reply as she did.
Probably one of the Hungarian employees had asked her to assist
because she was fluent in English.
[45]
Kope said that she
would not have involved herself in THR matters unless asked to do so.
The request in this case had come from
THR’s general manager,
Manno
Pal, because of her language skills.
Apart from Molnar (who travelled a good deal and had an office in the
United States), the only
other Hungarian staff member fluent in
English was Ruppert who was probably away at the time. She had
directed her enquiry to Vincorp
because it was reflected as the buyer
in THR’s records. THR furnished TIC with weekly reports
regarding sales and payments
received. She was aware that there were
two relevant entities in South Africa, the one which was billed
(Vincorp) and the one to
which THR shipped the barrels (VCC). She was
definitely not aware of the financial arrangements. Her statement
that she ‘was
aware of the arrangements’ was an
‘overstatement’ of what she knew, a ‘bad choice of
words’. She
was not intending to confirm anything but just
trying to get further information from Vincorp. She had not spoken
with Molnar before
writing the emails.
[46]
I am not persuaded that
Kope’s unguarded email is a sufficient basis for finding that
THR, when accepting the orders and delivering
the barrels, understood
there to be an arrangement in terms whereof Vincorp would not make
payment unless it received payment from
VCC. There is nothing to
suggest that Kope herself had any relevant dealings with Vincorp. The
judge regarded Molnar and Kope as
honest witnesses and he
specifically accepted Kope’s explanation about the email of 24
November 2009. There was evidence
from Vincorp that historically its
payments to THR did not religiously follow the 60-day or 90-day
limit. Haumann testified that
historically Vincorp only paid THR
after receipt of money from VCC (or from the customers, who sometimes
paid Vincorp directly),
which was sometimes as late as four to six
months after invoice date. I accept that this was the de facto
position. I am willing
to accept, also, that the Hungarian office
knew that in practice the timing of Vincorp’s payments to THR
was influenced by
cash flows from VCC. However until the second half
of 2009 Vincorp had never defaulted. The fact that THR tolerated late
payments
does not mean that it did not regard Vincorp as ultimately
liable. Vincorp was the party to whom THR directed the request for
payment
when the delay became unacceptable.
Conclusion
[47]
It is thus my
respectful view that the trial judge erred in dismissing THR’s
claim. Although the summons alleged an outstanding
balance of
$146 850, it is common cause that if Vincorp is liable the
correct amount is $112 526.
[48]
The summons includes a
prayer for interest at the prescribed rate of 15,5%
p/a
a tempore
morae. We
were not addressed about the mora date. If demand was necessary to
place Vincorp in mora, the letter of 1 December 2009
would appear to
have been sufficient demand. At any rate summons was issued in
October 2011. The prescribed mora rate was 15,5%
on both occasions
and would continue to apply despite later changes in the prescribed
rate. Accordingly, and without making a determination
of the exact
mora date, interest at 15,5% should be ordered as prayed.
[49]
Mr McLarty asked that
we include an order allowing the travel and accommodation costs of
Molnar, Kope and Ruppert. I think that
these are matters for the
taxing master. Prima facie there is little basis for the defendant to
resist the reasonable travel and
accommodation costs of Molnar and
Kope. An adverse inference might have been drawn if the plaintiff did
not call Kope. I prefer
to express no opinion regarding Ruppert. The
trial judge said that her evidence did not really take the matter
further and I have
likewise found it unnecessary to dwell on her
testimony though this does not necessarily mean that it was not a
reasonable precaution
for the plaintiff to call her, bearing in mind
that it bore the onus.
[50]
I would thus make the
following order:
(a) The appeal is allowed with costs.
(b) The order of the court a quo is set aside and
replaced with the following:
(I) The defendant is ordered to pay the plaintiff
$112 526 together with interest at the prescribed rate of 15,5%
a tempore
morae.
(ii) The defendant is further ordered
to pay the plaintiff’s costs of suit.
ROGERS
ERASMUS
J (conc)
SAMELA
J (conc)
APPEARANCES
For
Appellant
Mr
RD McClarty SC
Instructed
by
Miller
Bosman Le Roux
Park
du Links
9
Niblick Way, Somerset Mall
Somerset-West
For
Respondent
Mr
R van Rooyen SC
Instructed
by
Faure
& Faure Inc
227
Main Stree
Paarl
[1]
Lusan is an acronym for the wine estates Le
Bonheur, Uitkyk, Stellenzicht, Alto and Neethlingshof.