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[2014] ZAGPJHC 306
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Hiberia (Pty) Ltd T/A Acts Projects v Lourens and Another (2013/44435) [2014] ZAGPJHC 306 (30 October 2014)
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REPUBLIC OF SOUTH
AFRICA
IN THE HIGH COURT
OF SOUTH AFRICA
GAUTENG LOCAL
DIVISION, JOHANNESBURG
CASE
NO. 2013/44435
DATE:
30 OCTOBER 2014
In the matter
between:
HIBERIA (PTY) LTD
trading as ACT PROJECTS
..............................
Applicant
And
LEON
LOURENS
.....................................................................
First
Respondent
THE STANDARD BANK
OF SOUTH AFRICA LTD
.............
Second
Respondent
JUDGMENT
NOCHUMSOHN AJ
1. This is an
application ordering that the sheriff be authorised:
1.1. to recover from
the respondent and take possession of a Ford Ranger Double cab motor
vehicle, Engine Number SA......., Registration
number BW 9..........,
from 3... S....... Avenue, L........... Extension 2....., B.......;
1.2. ordering that
the sheriff be authorised to recover and remove such vehicle from the
respondent or anyone holding possession
of the vehicle, wherever it
may be found;
1.3. ordering that
such vehicle be handed to the applicant within five days from the
date of recovery of the said vehicle by the
sheriff;
1.4. ordering that
the respondent pay the costs of the application on the scale as
between attorney and client.
2. The application
is opposed by the first respondent only, and, although the second
respondent is cited, has correctly in my view
been joined and has
been served with all of the papers, it has nevertheless failed to
file a notice to oppose or any opposing papers
of whatsoever nature.
3. Conversely, the
application is opposed by the first respondent who has launched a
counter-application, which is formulated in
the first respondent's
Notice of Motion in Reconvention to be found at page 109 of the
papers, in the following words:
"1. That the
applicant and first respondent's agreement regarding the payment by
the first respondent of a deposit of R70 000.00
on the Ford Ranger
relevant to both applications should be regarded as containing an
agreement to the effect that, should the employment
of first
respondent with the applicant be terminated before the vehicle
becomes the property of first respondent, applicant will
be obliged
to refund the first respondent the amount of R70 000.00 upon which
applicant will be entitled to possession of the Ford
Ranger being the
subject of applicant's own application;
2. That the
applicant be ordered to pay to the first respondent the amount of R70
000.00 whether in terms of the implied term (see
paragraph 1 above)
or based on the principles of unjust enrichment;
3. That the first
respondent will be entitled to remain in possession of the Ford
Ranger until payment of R70 000.00 had been made
to the first
respondent;
4. That the
applicant is ordered forthwith but not later than seven working days
from the date of the order to account to the first
respondent
regarding all amounts that the applicant had paid over as PAYE to the
South African Revenue Service (SARS) regarding
the salary of the
first respondent for the period that first respondent had been
employed by the applicant;
5. That the
applicant be ordered to supply the first respondent with a form IRP5
reflecting the salary and PAYE that had been paid
over to SARS;
6. Costs of
application/s on a scale as between attorney and client."
4. I am also faced
with an opposed application, launched by the first respondent, for
the condonation of the late filing of his:
4.1. Answering
Affidavit in the main application; and
4.2. Replying
Affidavit to the applicant's Answering Affidavit to his
counter-application.
5. The historical
facts relating to the exchange of papers are, as follows:
5.1. The first
respondent had filed a Notice of Intention to Oppose the main
application, but failed to deliver an Answering Affidavit
within the
time periods provided for in the rules of court;
5.2. Arising out of
the aforesaid failure, the applicant enrolled the main application
for hearing upon the unopposed motion roll
for 5 March 2014;
5.3. Two days prior,
and upon 3 March 2014, after the aforementioned enrolment and set
down had been effected, the first respondent
filed his aforesaid
Notice of Counter-Application together with the Answering Affidavit
in which was embodied his case to sustain
his aforementioned
Counter-Application;
5.4. Consequently,
upon 5 March 2014, the application was postponed sine die and the
first respondent was ordered to pay the costs
of the postponement;
5.5. The applicant's
Replying Affidavit to be found at paginated page 125 was deposed to
on 19 March 2014 and was presumably served
at that time;
5.6. To the extent
that such Replying Affidavit comprised an answer to the first
respondent's Counter-Application, the first respondent
filed a reply
thereto at page 157 of the paginated papers, in the form of an
Affidavit headed "Affidavit in Reply to the Applicant's
/
Respondent's in Reconvention's Answering Affidavit", which
document was served upon the applicant's attorneys as late as
17 June
2014;
5.7. As late as 17
June 2014, the first respondent delivered a Notice of Motion (page
244 of the papers) for an Order:
5.7.1. Condoning the
late filing of his Answering Affidavit to the application of the
applicant;
5.7.2. Condoning the
late filing of his Reply to the Answering Affidavits of the applicant
/ first respondent in reconvention to
the Counter-Applications of the
first respondent;
5.7.3. Costs of the
application, only if opposed.
5.8. Attached to
such Notice of Motion, is an Affidavit deposed to by the first
respondent, in which he sets out his reasons for
seeking condonation;
5.9. The application
for condonation is opposed by the applicant, to which end, the
applicant deposed to an Affidavit in opposition
thereto upon 4 July
2014, the same having been delivered upon 9 July 2014;
5.10. Save to say
that the first respondent's grounds upon which the condonation is
sought, are flimsy, to say the very least, I
do not intend to deal
any further with such grounds in this judgment. Whilst the excuses
raised for the non-compliance of the
court rules in relation to the
delivery of the said Affidavits, are feeble, the Affidavits
themselves embody the heart and soul
of the first respondent's case;
5.11. Whilst no
fault whatsoever can be imputed to the applicant for the late
delivery of the said applications, and, whilst it
is clear to me that
the first respondent has been nothing short of dilatory, without good
reason, for the late delivery of such
affidavits, I do nevertheless
have a discretion, which I intend to exercise in favour of the first
respondent;
5.12. Were I to
dismiss the application for condonation the effect of such order
would effectively be to disallow the presentation
by the respondent
of either his defence or his Counter-Application;
5.13. In the
interests of justice, it would be preferable to permit the first
respondent's version to be placed before me, notwithstanding
the
inadequate explanations set out in the first respondent's Affidavit
in support of his application for condonation;
5.14. Accordingly,
the application for condonation is granted. However, there is no
reason to visit the applicant with the costs
in respect of such
application.
5.15. The applicant
was significantly prejudiced by virtue of the delays occasioned by
the late filing of the first respondent's
papers. Whilst I have
granted the application for condonation, I do nevertheless find that
the applicant was entitled to oppose
such application, as it did.
Accordingly, I deem it appropriate to part from the usual principle
whereby costs follow the event,
in specifically ordering that
notwithstanding the granting by me of the application for
condonation, the first respondent is hereby
ordered to bear the costs
of the applicant in relation to such application for condonation.
6. Turning to the
merits of the application, it appears to be common cause between the
parties that:
6.1. the first
respondent was an employee of the applicant;
6.2. the first
respondent was dismissed from the applicant's employ during or about
October 2013;
6.3. at the time of
his dismissal, the first respondent was in possession of the Ford
Ranger motor vehicle being the subject matter
of the application;
6.4. the vehicle was
made available to the first respondent by the applicant as part of
his employment;
6.5. the vehicle was
registered in the name of the applicant;
6.6. the vehicle had
been financed by the second respondent, who in such capacity was
registered as the titleholder;
6.7. the applicant
entered into the finance agreement with the second respondent (page
14 of the papers), paragraph 1.1 of which
provides that the second
respondent is the owner and that the applicant would only become the
owner once all instalments have been
paid and all duties in terms of
the agreement had been fulfilled. In terms of paragraph 1.4 of the
agreement, the applicant bore
all the risk in and to the vehicle from
date of signature of the agreement;
6.8. The applicant
bore the liability for payment of the finance charges under the
agreement with the second respondent and has
made such payments
throughout;
6.9. The principal
debt owing by the applicant to the second respondent in accordance
with the Instalment Sale Agreement amounted
to R477 316.80 inclusive
of interest at 7.75% per year and a deposit of R70 000.00 was paid by
the first respondent to the second
respondent at the time of
conclusion of the said Instalment Sale Agreement.
7. On the
applicant's version:
7.1. At paragraph 16
of the Founding Affidavit, it was at all times understood that the
first respondent would not become the owner
of the motor vehicle and
that his possession of the motor vehicle would be contingent upon his
continued employment with the applicant;
7.2. The first
respondent caused annexure "C" to the Founding Affidavit to
be delivered, comprising his attorney's letter
dated 1 October 2013,
under which the first respondent indicates that he had paid R70
000.00 as a deposit on the vehicle and expected
that this money be
refunded to him, and until such time as the money was paid back to
him, he would retain possession of the vehicle;
7.3. The applicant
categorically states (paragraph 20 of the Founding Affidavit) that
there was no agreement to the effect that
the first respondent would
be refunded the R70 000.00;
7.4. The applicant
says that it was at the first respondent's request that he be
provided with a "status" company vehicle
and that the first
respondent would be prepared to contribute towards the cost of being
able to drive such a motor vehicle;
7.5. Consequent upon
such demand, the applicant's attorney responded to the first
respondent's attorney and confirmed that R70 000.00
had been placed
by the applicant in his trust account and invested in accordance with
Section 78 (2A) of the Attorneys Act, which
amount would be held as
security for the first respondent's claim, and would be paid out if
the matter became settled or upon the
first respondent obtaining a
court order compelling the applicant to make payment of this amount.
It is clear from such correspondence,
that the applicant did not
concede that it was liable to refund the R70 000.00.
8. Conversely, the
first respondent:
8.1. denies that the
R70 000.00 was paid by him towards the purchase price so that he
could drive a ”status" vehicle
and contends, at paragraph
8 of the Answering Affidavit (Page 115), that there was an explicit
agreement to the effect that the
vehicle, once paid for in full,
would become his exclusive property;
8.2. raises that the
applicant had been unjustly enriched at his expense and that it would
be inequitable if restitution is not
made to him in respect of the
deposit paid by him for the vehicle;
8.3. Whilst the
first respondent concedes at page 120 that the applicant would pay
all of the incidental costs, such as registration,
licensing,
insurance, maintenance and repairs and of course the monthly
instalments, he insists that when the vehicle was to be
paid up in
full, it would be transferred into his name and he would become the
owner thereof. He goes on to say at paragraph
17 (page 121) that:
"We did not
contemplate the possibility at the time that I would either be
dismissed or would resign and as to what the position
would be should
my employment come to an end. If this had been discussed I would
have insisted that one of two situations be agreed
upon: Either I
would be given the opportunity to purchase the Ford Ranger for the
outstanding amount with Standard Bank or my
R70 00.00 would be repaid
to me upon which I would have returned the vehicle to the applicant."
9. It seems that the
first respondent calls upon me in his Counter-Application to import
an implied term into the agreement to the
effect that in the event of
his employment with the applicant coming to an end at a time prior to
payment in full to the second
respondent, that he, the first
respondent, then be given an option to purchase the vehicle for the
outstanding amount owing to
the second respondent or that his R70
000.00 would be returned to him, upon which, he would have returned
the vehicle to the applicant.
10. Simply put, the
applicant vigorously denies that there ever was any such agreement to
the effect that the R70 000.00 would be
refunded in the event of the
first respondent's employment being terminated at a time prior to
payment in full to the second respondent.
The applicant's case is
that irrespective as to when and how the employment of the first
respondent would have come to an end,
upon the termination of such
employment, the first respondent would forfeit his right to possess
the vehicle or re-claim his R70
000.00.
11. Upon a proper
interpretation of the finance agreement, it is clear that the
applicant bears all of the risk in and to vehicle
until such time as
same is paid for in full. It is likewise crystal clear from the
terms of such agreement that ownership in
and to the vehicle would
vest in the applicant, upon payment in full to the second respondent.
12. There is no
basis for any finding to support the importation of such implied term
into the agreement between the applicant and
first respondent, to the
effect that the first respondent would be vested with such option to
purchase, alternatively a right to
be refunded his R70 000.00, in the
event of his employment being terminated prior to payment in full to
the second respondent.
Accordingly, I find that there was no such
implied term.
13. It becomes a red
herring as to whether or not there was indeed an agreement between
the applicant and first respondent to the
effect that upon payment in
full to the second respondent, the first respondent would become the
owner and the vehicle would be
transferred into his name. Whilst
this version contended for by the first respondent is vehemently
denied by the applicant,
such circumstances did not present
themselves, given that the employment of the first respondent with
the applicant was terminated
at a time prior to payment in full to
the second respondent. Hence, it is not necessary for me to make
any finding in connection
therewith.
14. Absent the
importation of such implied terms into the agreement reached between
the applicant and the first respondent, the
ownership of the motor
vehicle falls to be determined, purely in accordance with the
Instalment Sale Agreement entered into between
the applicant and the
second respondent. In terms thereof, the second respondent, remains
the titleholder and owner of the vehicle,
until such time as it is
paid for, in full, whereupon, ownership vests in the applicant, who
remains liable to the second respondent
for the discharge of all
financial obligations thereunder.
15. There is no
reason to find against the applicant, in its contentions that the
vehicle belonged to the applicant, and, the first
respondent was
given the use thereof during the tenure of his employment with the
applicant, as part of his conditions of employment.
It is clear
that this version is the correct version, which I accept without
hesitation. That being the case, any right that
the first
respondent held to remain in possession of the vehicle, came to an
abrupt end immediately upon the termination of the
first respondent's
employment with the applicant. It was disingenuous of the first
respondent to have tendered the return of
the vehicle, only against a
refund of the sum of R70 000.00, as set out in the letter written by
the first respondent's attorney,
Odendaal & Kruger, to the
applicant dated 1 October 2013 at page 19 of the papers. Clearly,
the first respondent was not
vested with any right of retention in
respect of the vehicle, as bargained for in the said letter.
16. Accordingly, I
find that the applicant is entitled to the relief sought in the
Notice of Motion and that the vehicle must be
returned to the
applicant, forthwith. The applicant has been so entitled to the
return of the vehicle from the date of termination
of the first
respondent's employment and has been frustrated by the first
respondent in all of this time, in the exercising of
its rights
against the first respondent in this regard. The consequence of the
aforegoing will become relevant in relation to
the unjust enrichment
claims and the costs order which I will make in relation to all of
these proceedings, herein-below.
17. Whilst there is
no evidence to support the first respondent's contentions for the
importing of his sought after implied terms
into the agreement, I am
nevertheless compelled to consider what the position would have been
had his employment with the applicant
been terminated within a day
or two after the completion of the Instalment Sale Agreement with the
second respondent. I am left
without any doubt in my mind, that in
such circumstances, the applicant would undoubtedly have been
unjustly enriched to the extent
of R70 000.00, on the assumption that
the vehicle would have been returned to it immediately. In those
circumstances, the first
respondent would have enjoyed a claim
against the applicant under the laws of unjust enrichment.
18. It was clearly
within the contemplation of the parties that at the time the
Instalment Sale Agreement was entered into and the
first respondent
contributed his deposit of R70 000.00, that the first respondent
would remain in the employ of the applicant beyond
the date of
payment in full by the applicant to the second respondent.
19. The Instalment
Sale Agreement was entered into upon 28 May 2012 and the first
respondent's R70 000.00 would have been paid to
the second respondent
on or about that day. The Instalment Sale Agreement provided for
payment of R7 955.28 each, at one monthly
intervals, commencing upon
1 July 2012 and terminating upon 27 May 2017. Thus the expiry date
of such agreement was 27 May 2017,
and as stated, I find that it was
within the contemplation of the parties that at the time of the
entering into of the transaction,
the first respondent would remain
in the employ of the applicant, beyond such expiry date.
20. Factually, the
first respondent was dismissed by the applicant and his employment
came to an end during October 2013, some three
years and eight months
prior to the expiry date of the Instalment Sale Agreement and some
seventeen months after the date of entering
into of such Instalment
Sale Agreement.
21. Whilst I do find
that the applicant has been unjustly enriched, to the prejudice of
the first respondent, the quantum of such
unjust enrichment cannot
equate to the said payment of R70 000.00. Had the first respondent
remained in the employ of the applicant
up until the expiry of the
Instalment Sale Agreement on 27 May 2017, there would certainly have
been no obligation upon the applicant
to refund the R70 000.00 or any
part thereof to the first respondent at that time.
22. Therefore, the
fairest mechanism for the quantification of such unjust enrichment
would be by dividing the R70 000.00 by the
total number of payments
provided for in the Instalment Sale Agreement (58 months) and
multiplying same by the number of months
for which the Agreement ran
its course up until the termination of the respondent's employment
i.e. R70 000.00 divided by 58 equals
R1 206.89 per month x 15 equals
R18 103.44. Thus if one deducts the aforesaid R18 103.44 from the
amount paid by the first respondent
of R70 000.00, one arrives at a
figure of R51 896.55, to which the applicant would have been unjustly
enriched, had the vehicle
been returned to it immediately against the
termination of the first respondent's employment in October 2013.
23. However, I am
equally compelled to take into account the evidence of the applicant,
offered at paragraph 84 of the Replying
Affidavit to be found at page
143 of the papers, where the applicant says "the first
respondent has been unjustly enriched
as he has had the use of a
motor vehicle for which the applicant is paying since October 2013
through to date of hearing of this
matter at a cost of approximately
R9 840.00 per month....... Applicant has a claim against the
first respondent for these damages,
and it is partly for this reason
that the applicant did not pay over the R70 000.00 directly to the
first respondent because of
such Counterclaim."
24. We are now one
year down the track, since the time of the dismissal of the first
respondent, who, to date, remains in possession
of the vehicle,
whilst the applicant bears all of the financial obligations in
respect thereof at a cost of R9 840.00 per month.
R9 840.00 per
month, multiplied by 12 months for the period 1 November 2013 to 31
October 2014, amounts to some R118 080.00,
to which extent there may
be a basis for the applicant to assert that the first respondent has
been unjustly enriched. Balanced
as against such unjust enrichment,
is the fact that the vehicle would have depreciated further in value
over this past year, which
may serve to exacerbate any claim for
unjust enrichment against the first respondent in the hands of the
applicant. Whilst no
such claim is brought in these proceedings,
nevertheless same must be conceptualised, albeit on a hypothetical
basis. This is
in order to assess the validity of the first
respondent's Counterclaim to payment of R70 000.00 (based upon unjust
enrichment)
which for the reasons set out above, could, in any event,
not reasonably exceed R52 000.00. The latter amount must be offset
against
the obvious financial prejudice suffered by the applicant,
which, as demonstrated, exceeds the financial prejudice suffered by
the first respondent, by far. Accordingly, I find that the first
respondent's counterclaim for repayment of R70 000.00 fails,
both ex
contractu, as there is no evidence to support the implied term to the
Agreement bargained for, as well as in accordance
with the laws of
unjust enrichment, for the reasons set out above.
25. Turning to the
first respondent's second leg of the relief sought in his
counterclaim, it should be noted paragraph numbers
4 and 5 of the
Notice of Motion in reconvention, overlaps.
26. It is common
cause that the first respondent was an employee of the applicant and
that the applicant dismissed the first respondent
during or about
October 2013.
27. There is no
reason for the first respondent to have been deprived an IRP5 form,
reflecting his salary and the amount of PAYE
that would have been
paid over to SARS. Indeed the handing over of such form is a
legislative requirement and there is no reason
offered by the
applicant for its failure to have so performed.
28. Whilst the
applicant says at paragraph numbers 81 and 86.2 that it has tendered
such documentation to the first respondent,
it is clear that for
whatever reason the first respondent has not been placed in
possession of an IRP5 form.
29. The first
respondent is entitled to receive an IRP5 form, cannot submit his tax
return to SARS without same and, conversely,
the applicant is
duty-bound to deliver IRP5 forms to the first respondent for the
period during which he was in the employ of the
applicant.
30. It does not
avail the applicant to rely on a tender, without a suitable
explanation for the non-delivery of such forms. No
matter how
heated the tensions may or may not be between the applicant and the
first respondent, all that needed to be done, was
for the IRP5 forms
in question to be delivered by the applicant's attorneys to the first
respondent's attorneys. Whilst there
are on-going labour disputes
between the parties which are not capable of resolution in this
court, there is no reason to deny
the first respondent his relief in
relation to the seeking of an order for the delivery of his IRP5
forms.
31. Accordingly, I
find that the applicant is duty-bound to deliver IRP5 forms to the
first respondent immediately. To such end,
and to a limited extent,
the first respondent succeeds in his counter-application. However,
the bulk of the Answering Affidavit
and papers relating to the
counter-application deal with the first respondent's claim for
payment of R70 000.00 and all of such
papers, throughout, are
unnecessarily prolix and are riddled with irrelevant material,
inconsequential subject matter, irrelevant
annexures, all of which
has little or no bearing upon the issues at stake. To this end some
kind of punitive costs order as against
the first respondent would be
apposite. The counter-application encompasses only a few paragraphs
relevant to the IRP5 forms,
in relation to which the first respondent
has been successful in this judgment. Perhaps 20% of the content of
the papers deals
with the IRP5 forms, whereas 70% to 80% of the
unnecessarily lengthy papers deals with the prior claim.
Accordingly, the respondent
should be entitled to no more than 20% of
a taxed bill of costs in relation to the counter-application.
Accordingly, I make
the following Order:
1. The condonation
of the late filing of the first respondent's Answering Affidavit and
the first respondent's Affidavit in reply
to the Applicant's Answer
to the Respondent's Counter-Application are condoned.
2. The first
respondent is ordered to bear the costs of the said application for
condonation, on an opposed basis, taxed by the
applicant on the scale
as between party and party.
3. The Sheriff of
the Court is authorised to recover from the first respondent and to
take possession of a Ford Ranger Double cab
motor vehicle, engine
number SA2KPCC43950, registration number BW94MKGP, from 34 Strathford
Avenue, Lakefield Extension 12, Benoni,
or wherever else same may be
found.
4. The Sheriff shall
be authorised to recover and remove such vehicle from the first
respondent or anyone holding possession of
such vehicle, wherever it
may be found.
5. Such vehicle
shall be handed to the applicant by the Sheriff within five days from
the date of recovery of the said vehicle by
the Sheriff.
6. The first
respondent shall pay the costs of the main application, taxed on the
scale as between attorney and client.
7. The applicant is
ordered to forthwith deliver to the first respondent IRP5 forms for
the period during which the first respondent
was in the employ of the
applicant.
8. The applicant is
ordered to bear 20% of a Bill of Costs to be taxed by the first
respondent in respect of the opposed Counter-Application,
on the
scale as between party and party.
NOCHUMSOHN, G
ACTING JUDGE OF
THE HIGH COURT
On behalf of the
Applicant: Advocate L Hollander
Instructed by: MJ
Hood & Associates
On behalf of the
Respondent: Attorney Johan Schaefer
Date of
Hearing: 30 October 2014
Date of
Judgment: 30 October 2014