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[2019] ZAGPJHC 481
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Standard Bank of South Africa Limited v Sibanda (38883/2011) [2019] ZAGPJHC 481; 2021 (5) SA 276 (GJ) (28 November 2019)

HIGH
COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, JOHANNESBURG)
Case
No. 38883/2011
In the matter between:
STANDARD
BANK OF SOUTH AFRICA
LIMITED
Plaintiff
and
NKULUMO
HOPEWELL
SIBANDA
Defendant
Case
Summary
:
Practice – judge who presided at the trial
became
indisposed and unable to deliver judgment
– parties not wanting trial
de
novo
–
procedure, by agreement between the parties,
that
a transcript of the evidence, together with the documentary exhibits,
be
placed
before another judge for the hearing of argument and the delivery of
judgment followed - value of demeanour as a factor in
evaluating a
witness’ credibility considered
-
Mondi
Shanduka Newsprint (Pty) Ltd v Murphy
2018
(6) SA 230
(KZD)
not
followed.
Banking
– Money drawn against uncleared effects honoured by bank –
effects not met – loss to be borne by customer.
National
Credit Act, 34 of 2005
– Reckless Credit – a defence of
reckless credit constitutes a defence on the merits and must be
properly raised by
way of plea - question whether a financial
institution permitting an account holder to draw against uncleared
effects of a cheque
deposit into the account may in a given situation
amount to a credit agreement that is reckless as contemplated in
s
80(1)
of the
National Credit Act i
n circumstances where the
provisional credit to the account is reversed when effects giving
rise to such credit are not cleared,
left open.
JUDGMENT
MEYER J
[1]
The defendant, Mr Nkulumo Hopewell Sibanda (Mr Sibanda), conducted a
current account at the plaintiff bank, Standard Bank of
South Africa
Limited (Standard Bank).  Mr Sibanda drew the amount of R448
179.71 by means of a cheque card purchase before
certain effects
deposited to the account were cleared.  Standard Bank honoured
the withdrawal.  Subsequently the effects
were not paid.
Standard Bank is suing Mr Sibanda, in contract or based on
enrichment, for payment of the sum of R472 996.66,
being the debit
balance on the account that includes the said sum of R448 179.71.
[2]
The hearing of evidence has been completed, but the presiding
judge became indisposed and unable to deliver judgment.
The
parties agreed that a transcript of the proceedings, which include
the evidence and Standard Bank’s closing argument,
together
with the documentary exhibits and the parties’ written heads of
argument that were furnished to the trial judge,
be
placed
before me for the delivery of judgment.  In his letter of
consent to this procedure being followed, Mr Sibanda stated:
‘
. . . I
have no financial muscle to restart these proceedings afresh.’
I
agreed to the procedure for the reasons that follow and invited the
parties to address further oral argument to me, if they wished.
[3]
Standard Bank instituted this action against Mr Sibanda on 12 October
2011.  The trial commenced on 14 October and was
concluded on 16
October 2015.  Standard Bank called Mr Mark John van der Walt, a
senior manager in its legal collections department,
as its only
witness.  In defence, only Mr Sibanda testified.  After the
leading of evidence only Standard Bank’s
counsel presented an
oral closing argument.  Mr Sibanda elected only to furnish the
trial judge with written heads of argument
by an agreed date.
It was further agreed that Standard Bank, in addition to its oral
closing argument, would also furnish
the trial judge with written
heads of argument by an agreed date.  Due to the trial judge
having become indisposed, the Judge
President of this division
allocated the matter to continue before me.
[4]
Mondi Shanduka Newsprint (Pty) Ltd v Murphy
2018 (6) SA 230
(KZD) is a matter that went to trial, all the evidence was led,
argument was heard and judgment reserved.  Before giving
judgment the trial judge died.  When the matter went back to
court to continue before another judge (Lopes J), the parties
agreed
and requested the court to finalise the matter by the presiding judge
reading all of the documents that would have been
available to the
deceased judge, hearing argument from the parties and then deciding
the matter, rather than the trial beginning
de novo
.  In
refusing the proposal and directing that the trial begin
de novo
if the parties wished to continue with the matter, Lopes J said the
following:
‘
[21] In
my view none of the arguments advanced before me, nor the cases cited
in favour of the matter being heard as sought by the
parties, have
provided a solution to the problem that matters of credibility cannot
be dealt with in the manner suggested by the
parties. There are
numerous disputes of fact and expert opinion in the record of the
proceedings, and a determination of those
would be crucial to any
decision.
[23] Whilst the
parties may well place whatever evidence they wish before a civil
court, the court still has to decide the matter
on the applicable
principles of law. Parties may, for example, agree that a certain
fact can be accepted by the court as being
true, when there is no
documentary or viva voce evidence to support the finding of fact. In
this way parties to civil actions may
agree to limit, to some extent,
the role of a judicial officer in determining matters. That is a very
different thing, however,
to parties being able to dictate to a judge
how to exercise his oath of office by restricting the judge's
adherence to legal principles,
statutes, and precedent. Given the
number of conflicts of fact and expert opinion in this case, I am of
the view that a judge would
not be able properly to determine the
matter upon a mere reading of the record.
[24] It is also
no answer to the above to suggest that one can simply apply the tests
set out in
Stellenbosch Farmers' Winery
[
Stellenbosch
Farmers’ Winery Group Ltd and another v Martell et Cie and
others
2013 (1) SA 11
(SCA)] for the resolution of disputes. That
is because the first two aspects referred to by the learned judge
of appeal are
the credibility of the factual witnesses and their
reliability. The very fact that they cannot be decided merely on
paper is recognised
in
Plascon-Evans
and provides a
limitation on the ability of judges to make such decisions, except in
special circumstances. This matter is
distinguishable from the
situation where a case is part heard, and the judge may recall
one or more witnesses (who have recently
testified) in order to
clarify any particular uncertainty.
[25] Were I
merely to override those considerations, albeit with the consent of
the parties, I have serious doubts as to whether
I would be
fulfilling my oath of office by allowing the parties to a civil
action to restrict the ordinary performance of my duties.’
[5]
The premise of the finding in
Mondi
appears to be that the
opportunity of a judge presiding at a trial to observe the demeanour
of a witness is of great value in deciding
whether or not to believe
the witness’s testimony.  But that premise does not seem
to be supported by relevant social
science. On the contrary, as WH
Gravett
Spotting the liar in the witness box – How valuable
is demeanour evidence really?(1)
2018 (81) THRHR 437
,
convincingly argues, that premise is contradicted by extensive
empirical social science data.
[6]
Dr WH Gravett, who is a senior lecturer, Department of Procedural Law
at the University of Pretoria,  examined the value
of a witness’
demeanour as a guide to the truth of testimony in the light of a
well-developed body of behavioural science
research spanning some
seven decades.  The extensive empirical evidence, as
demonstrated by him, ‘shows that demeanour
– as a means
of accurate reliable credibility assessment and decision-making in
litigation – essentially is worthless.’
Human lie
detection, according to the learned author, ‘is fraught with
difficulty.  It is predicated upon a multitude
of misconceptions
about how liars behave, including specific verbal and nonverbal cues
commonly believed to indicate dishonesty.’
The empirical
research, according to the learned author, ‘overwhelmingly
demonstrates that ordinary people, including fact-finders,
have no
particular talent for spotting lies’ and that this ‘inability
of most ordinary people to detect deception accurately
has even
greater implications in a heterogeneous society, such as ours, in
which fact-finders often have to overcome racial and
cultural
differences in determining witness credibility’.
[7]
The empirical research, according to the learned author, demonstrates
that ‘[t]he traditional legal perspective on the
evaluation of
demeanour evidence is premised on four fallacies regarding how liars
and lie-detectors behave: (i) that detecting
deception in another is
a matter of “common sense”; (ii) that liars betray
themselves through certain telltale signs
in their physical
demeanour; (iii) that observers know which behavioural cues to look
for in evaluating speakers’ truthfulness;
and (iv) that
observers thus have a substantially better-than-average chance of
catching liars’ (at 443
et seq
).  In conclusion he
states (at 450):
‘
In short, there exists cogent
evidence from social science studies that demonstrates that the
concept of demeanour evidence as accepted
by the law is invalid as it
stands.  In attempting to use a witness’s conduct, manner,
bearing (“demeanour”)
to assess that witness’s
credibility, most fact-finders will in fact rely on highly
manipulative cues that mislead them,
and will conclude that a witness
is perjurious more often than they should.’
[8]
The learned author also considered
inter alia
the reasons for
the poor lie detecting ability of people and why lie detecting in
court is even more difficult than in the laboratory
in his second
instructive article on the topic: WH Gravett
Spotting the liar in
the witness box – How valuable is demeanour evidence really?(2)
2018 (81) THRHR 563.
According to the research referred to
by him (at 563-4)-
‘
[c]ertain signs of perceived
deception, especially those involving the face, are also simply signs
of nervousness and distress.
It is almost impossible to
distinguish between a person who experiences stress because she is
guilty and on the verge of being
exposed, and someone who experiences
stress because she is innocent and stands falsely accused. . . . Yet,
researchers have consistently
found that observers attach meaning and
significance to these behavioural cues of nervousness or anxiety even
when the message
is truthful.  The mistaken interpretation of
interrogation stress as deceit is so prevalent in the psychological
literature
that the phenomenon has come to be called “Othello’s
error” because it is excellently illustrated by Othello’s

mistaken interpretation of Desdemona’s distress and despair in
response to his accusation of infidelity.’
[9]
I respectfully agree entirely with the learned author that ‘by
far the best determinant of the truth of testimony is not
a witness’s
demeanour (visual or auditory behavioural cues) at all, but the
actual content of the testimony’ and that
factors ‘such
as self-contradiction, inherent plausibility or the lack thereof,
omissions and imprecisions, verification
of facts testified to by
other witnesses and exhibits, bias or motive on the part of the
witness, and limitations of recall are
among the most important
indications of witness credibility’, all of which would be
readily discernible by a reading of a
transcript of the evidence (at
566).
[10]
Our highest courts have displayed more than a modicum of discomfort
when assessing the value of demeanour evidence.  In
S v Kelly
1980 (3) SA 301
(A) at 308B-D, this was said:
‘
[D]emeanour
is, at best, a tricky horse to ride. There is no doubt that demeanour
- 'that vague and indefinable factor in estimating
a witness's
credibility' (
per
HORWITZ
AJ in
R v Lekaota
1947
(4) SA 258
(O) at 263) - can be most misleading. The hallmark of a
truthful witness is not always a confident and courteous manner or an
appearance
of frankness and candour. As was stated by WESSELS JA
in
Estate Kaluza v
Braeuer
1926 AD 243
at
266 more than half a century ago in this Court:
“
A
crafty witness may simulate an honest demeanour and the Judge had
often but little before him to enable him to penetrate the armour
of
a witness who tells a plausible story.”
On the other
hand an honest witness may be shy or nervous by nature, and in the
witness-box show such hesitation and discomfort
as to lead the court
into concluding, wrongly, that he is not a truthful person.’
[11]
In
President of the Republic of South Africa v South African Rugby
Football Union
2000 (1) SA 1
(CC) para 79, the Constitutional
Court said that-
‘
[t]he
advantages which the trial court enjoys should not, therefore,
be over-emphasised 'lest the appellant's right of appeal
becomes
illusory'.  The truthfulness or untruthfulness of a witness can
rarely be determined by demeanour alone without regard
to other
factors including, especially, the probabilities.  As indicated
above, a finding based on demeanour involves interpreting
the
behaviour or conduct of the witness while testifying. The passage
from
S v Kelly
above
correctly highlights the dangers attendant on such interpretation.
A further and closely related danger is the
implicit assumption, in
deferring to the trier of fact's findings on demeanour, that all
triers of fact have the ability to interpret
correctly the behaviour
of a witness, notwithstanding that the witness may be of a different
culture, class, race or gender and
someone whose life experience
differs fundamentally from that of the trier of fact.’
[12]
In upholding a full bench’s reversal of adverse credibility
findings by a trial magistrate in
Allie v Foodworld Stores
Distribution Centre (Pty) Ltd
2004 (2) SA 433
(SCA) para 38,
Navsa JA referred with approval to the following passage in the
judgment of the court
a quo
:
‘
In
dealing with demeanour and credibility in relation to
the magistrate's findings Van Zyl J said the following:
“
Of
course, the judicial officer, who has sight of the witnesses and is
able to assess their evidence from nearby, is the best person
to
gauge their demeanour. The record of such evidence, however, speaks
for itself. If a witness is mendacious, contradictory or
evasive,
this will appear from the record. And if a judicial officer has
justified criticism of a witness or of his or her evidence,
the
justification for such criticism will normally also appear from the
record. Even more so will this be the case when a credibility
finding
is made against a particular witness. Although a Court of appeal is
reluctant to interfere with credibility findings made
by the court of
first instance, it is not obliged to accept such findings if they
should not appear to be justified.”’
[13]
In
St Paul Insurance Co SA Ltd v Eagle Insurance Ink System (Cape)
(Pty) Ltd
2010 (3) SA 647
(SCA), the Supreme Court of Appeal held
that w
here, in a civil matter in which the
hearing of evidence has been completed, the presiding judge dies
before the delivery of
judgment, the parties are entitled to agree
that a transcript of the evidence, together with the documentary
exhibits, be
placed before another judge
for the hearing of argument and the delivery of judgment.
Cloete JA, who wrote the unanimous judgment
of the Supreme Court of
Appeal, said this:
‘
[1] The
appellant, St Paul Insurance Co SA Ltd, is, as its name suggests, an
insurance company and I shall refer to it as such.
The respondent,
Eagle Ink System (Cape) (Pty) Ltd, to which I shall refer as Eagle
Ink, is a manufacturer, importer and distributor
of printing inks and
related products. The insurance company issued a policy of insurance
to Eagle Ink which, as the plaintiff,
sued the insurance company in
the Cape High Court for indemnity under the policy. Knoll J presided
at the trial, but died before
she could deliver judgment. By
agreement between the parties a transcript of the evidence, together
with the documentary exhibits,
was placed before Griesel J who heard
further argument. There is precedent for such a procedure, and it is
eminently sensible:
Mhlanga
v Mtenengari and Another
1993
(4) SA 119
(ZS).  Griesel J found in favour of Eagle Ink, but
subsequently granted leave to appeal to this court.’
[14]
In
Mondi
para 12, Lopes J distinguished
St Paul Insurance
Co
on the basis that it concerned the interpretation of clauses
in an insurance policy, but such a distinction, in my view, is not
justified in the light of the modern contextual approach followed by
our courts when interpreting written instruments.  The
process
of interpretation is not stopped at the literal meaning but
considered in the light of all relevant context without any

distinction being made between background and surrounding
circumstances.  (See
Natal Joint Municipal Pension Fund v
Enduneni Municipality
2012 (4) SA 593
(SCA) paras 17-26;
Bothma-Batho Transport (Edms) Bpk v S Bothma & Seun Transport
(Edms) Bpk
2014 (2) SA 494
(SCA) paras 10-12.)  Furthermore,
the Supreme Court of Appeal did not limit the procedure which it
considered ‘eminently
suitable’ to trial matters where no
assessment of the evidence of witnesses is required to be made.
Mondi,
with due respect, over-emphasised the advantages which
the trial court enjoys in observing the demeanour of witnesses in
deciding
on their credibility and the reliability of their evidence.
[15]
Turning to the merits, it is common cause that Mr Sibanda conducted a
current account at Standard Bank since 2005;  initially
an entry
level one called a
Classic Plus
account, which was during
October 2008 upgraded to a more prestigious one called a
Prestige
Plus
account.  The account remained the same, but its
upgrade afforded Mr Sibanda additional benefits, such as, according
to Mr
van der Walt, access to a personal banker, an overdraft
facility with a limit of R24 400 (which was repayable on
demand),
a debit card and the automatic ‘upliftment of the
U-status’, which means that a
Prestige Plus
current
account holder such as Mr Sibanda was permitted to draw against
uncleared effects of cheque deposits.
[16]
The cheque in issue is a trust cheque dated 8 May 2011, ostensibly
drawn by attorneys Morebodi-Paul Inc. on Absa Bank Limited,

Rustenburg for the amount of R462 000 in favour of ‘N.H.
Sibanda’.  It was deposited at Standard Bank, Eastgate

Branch on 11 May 2011, and credited to Mr Sibanda’s account.
Morebodi-Paul Inc. placed a ‘stop payment’
of the cheque
with their bankers, Absa Bank, Rustenburg.  The credit of R462
000 on Mr Sibanda’s account was reversed
after Mr Sibanda had
already drawn the amounts of R5 421 and R448 179.71 against
the uncleared effects of the cheque
deposit by means of cheque card
purchases of a flight ticket at South African Airways (SAA) and
foreign currency at American Express
Foreign Exchange (American
Express) at OR Tambo International Airport, Johannesburg (the
airport).
The
credit to Mr Sibanda’s account when the cheque of R462 000 was
deposited to his account was merely a ‘provisional
credit’
and effects giving rise to such credit had first to be cleared before
the credit became a final credit:
ABSA
Bank Ltd v IW Blumberg and Wilkinson
[1997] ZASCA 15
;
1997
(3) SA 669
(SCA) at 681F-G.
[17]
Mr van der Walt testified to the effect that the cheque card
purchases of the flight ticket and of the foreign currency were
‘pin
based’ transactions.  By Mr Sibanda entering his personal
identification number (pin) into the card machine,
he expressly
instructed Standard Bank to debit his account with the amount of the
transaction, in other words that was his instruction
to Standard Bank
to pay.  According to Mr van der Walt, at the time of the two
debit card point-of-sale electronic transactions,
Mr Sibanda was in
good standing with Standard Bank;  R462 000 stood to the
credit of his account by virtue of the cheque
deposit, his account
was in credit with a further amount of R3 500 and he had an
overdraft facility of R24 400.  The
funds were available to him
to transact with and the system, therefore, authorised the debit card
point-of-sale electronic transaction
for the purchase of the foreign
currency.
[18]
Mr Sibanda denies that a term permitting him to draw against
uncleared effects of cheque deposits, was ever agreed upon or
that he
was even aware that such privilege was afforded to him.  I need
not resolve this issue.  As was said by Zulman
JA in
IW
Blumberg and Wilkinson
at 675H-676C:
‘
The fact that the appellant
might have permitted the respondent to draw cheques against uncleared
effects, despite there being no
agreement in this regard, would not
excuse the respondent in law from liability to make payment to the
appellant.  The appellant
was perfectly entitled to choose to
honour such cheques, notwithstanding the fact that the effects
earlier deposited had not been
cleared, and to waive any benefit
afforded to it in this regard by its agreement with the respondent.
It would be strange
indeed if it were permissible for a customer of a
bank to draw a cheque on the bank, requesting the bank to honour the
cheque,
and thereafter, when the bank honoured the cheque despite the
absence of an overdraft facility, to plead that this would have
resulted
in an overdraft facility which had not been agreed upon.
In essence this is precisely what the respondent is contending for.

It hardly lies in the mouth of the respondent, who drew the two
cheques in question against uncleared effects, albeit contrary
to the
agreement between the parties, to be heard to complain that the bank
should not have honoured the cheques and debited its
account.
Put differently, it is the appellant, so it is suggested, who must
bear the loss if the uncleared effects were not
met.  This can
not be so.  (Compare
Bloems
Timber Kilns (Pty) Ltd v Volkskas Bpk
1976
(4) SA 677
(A) at 687E-688C;
Trust
Bank of Africa Ltd v Wassenaar
1972
(3) SA 139
(D) at 142G-143A and 143E-F.’
[19]
And in
Standard Bank of SA Ltd v Sarwan
[2002] 3 All SA 49
(W)
at 55g-i, Van der Walt AJ said this:
‘
Even where the parties agreed,
as in this matter in respect of the prestige account, that the
account-holder may draw immediately
upon “uncleared effects”,
the principle remains the same.  Such a privilege does not
detract in the least from
the fundamental principle that the risk of
non-payment, for whatever reason, of a cheque deposited for
collection, falls on the
customer and not on the bank.  It
would, if otherwise, not be in accordance with sound financial and
commercial common sense.
There may be exceptional circumstances
– perhaps in the case of a special clearance of a cheque.
I express, however,
no view in this regard.
Apart from being a term
ex lege
of the contract between the plaintiff and the defendant, the right of
reversal in the case of non-payment of a cheque deposited
for
collection in a current account, is, at the same time, an independent
and substantial principle of the body of banking law
as developed
over a long period by commercial practice, custom and usage.
Its existence and applicability is not dependent
upon consensus,
intention or knowledge on the part of the parties.  It is an
integral part of the objective law pertaining
to banking practice and
the relationship between banks and their account-customers.’
[20]
Mr Sibanda further contends that a bank official who was on duty at
the reception desk of the Standard Bank branch at the airport,

negligently misrepresented to him that there was a credit balance on
his account available for him to draw, as a result of which

misrepresentation he paid for the foreign exchange purchased for a
third party at American Express.  Standard Bank, he contends,

had a legal duty not to have misstated the true facts to him and its
negligent misrepresentation caused him loss in the amount
that is now
being claimed from him.  It is necessary to set out the evidence
of Mr Sibanda in some detail.
[21]
Mr Sibanda, who was about 40 years of age at the time and the holder
of an MBA degree, was employed in the capacity of a key
accounts
manager in the sales and marketing department of Robor (Pty) Ltd, a
company conducting business in the steel industry
(Robor).  He
looked after major clients (accounts) for Robor, including major
construction companies, such as Murray &
Roberts and Group 5.
On Wednesday, 11 May 2011, he attended a meeting at Robor’s
offices in Isando concerning a project
in Mauritius for which Murray
& Roberts and Group 5 were bidding.  Robor, in turn, wished
to supply steel for the project
to either company if awarded the
construction contract.  The meeting was about Mr Sibanda and
three of his colleagues who
were to go to Mauritius to assess the
project.  At the meeting only Mr Sibanda, as the person who was
looking after the engineering
sector for Robor, and one other
colleague were mandated to go.  During a short adjournment of
the meeting, Mr Sibanda received
a call from a stranger on his cell
phone, introducing himself as Tony Lionel and saying that he had
mistakenly deposited R462 000
into Mr Sibanda’s bank account.
Mr Sibanda told him that he needed to go back into a meeting he was
attending and asked
him for his cell number so that he could call him
back after the meeting in about an hour, to which Mr Lionel responded
that he
did not have a cell number but was calling from a public
telephone and would rather call Mr Sibanda more or less after that
time.
[22]
After the meeting Mr Sibanda immediately drove to the airport in
order to see whether he could get a ticket for a flight to

Mauritius.
On route
he received another call from Mr
Lionel who enquired from him where he was, and he told him that he
was driving to the airport
to see whether he can get a flight ticket
in connection with a work related project.  He asked Mr Sibanda
whether he had received
an SMS on his cell phone from his bank to
which Mr Sibanda responded that he had seen one, but because he was
speaking on his phone
at that moment was not able to read it.
Mr Lionel told Mr Sibanda that he would call him again within the
next 20 minutes.
[23]
Upon his arrival at the airport, Mr Sibanda saw an SMS from Standard
Bank confirming ‘the amount of money the gentleman
had
deposited into [his] account which was R462 000’.  He
first went to the banking section at the airport, withdrew
R2 500
with his card ‘to see if there was any difference from the SMS
[he] got and the money that was in [his] account’,
and he kept
the ATM slip.  He then went to the Emirates Airlines counter,
but was unable to get a flight to Mauritius for
the days he needed to
be there, and then to the SAA counter, where he bought a return
ticket, leaving for Mauritius on Thursday
morning, 12 May 2011 at
09:40, and returning on Saturday afternoon, 14 May 2011 at 15.35.
Thereafter he bought himself a
cool drink while he was waiting for Mr
Lionel.  He again went to the banking section and into the
Standard Bank branch.
He showed the lady in attendance at the
enquiries desk the ATM slip that he received when he drew the R2 500
cash as well
as the SMS from Standard Bank on his cell phone,
whereupon she said to him ‘the funds are available’ and
‘what
more do you need as confirmation, you have the slip and
you have the SMS’.
[24]
Mr Sibanda saw a man fitting the description of Mr Lionel.  He
had earlier given his description to Mr Sibanda, who also
told him
what he, Mr Sibanda, was wearing.  The man then approached him,
saying-
‘
. . . are
you Hope?  I said yes I am Hope because that is the name I gave
him on the phone when we spoke and I also asked him
are you Tony
Lionel and he said, yes, I am.’
They
greeted each other and Mr Sibanda said to him-
‘
. . . I
think it is only fair for us to go back to Standard Bank, which is
the bank that I bank with, so that we can make a transaction,
this is
a huge amount, I do not think I will be able to make any withdrawal
without the bank being involved so that I can give
you back your
money.  And he was with another gentleman which I did not ask
his name because I did not speak to him from the
start of the
conversation.  Mr Lionel insisted, that no, this is a huge
amount, I understand but I am also here at the airport
because I want
to travel so I would like to purchase some foreign currency using the
money.  . . . I said to Mr Lionel I am
not too sure if my card
would actually swipe that kind of money, depending on the machine.
That is why I offered still to
go to Standard Bank to say this is my
banker and they are only upstairs, it is not like we travelling
anywhere very far, so I wanted
to take him into the bank so that we
can make a transaction inside the bank.  . . .  And his
response was no, we cannot
go to the bank, because I want to purchase
foreign currency and foreign currency is here at American Express
which was actually
next to SAA at the time and as we were talking, we
were all standing close to SAA.  I would say between SAA and
American Express.
So we just talking generally in the public
area and I still insisted that, you know what, I never had this kind
of money in my
account, I doubt very much if I would be able to put
my card into a swiping machine and be able to swipe it off for you,
whatever
you want to buy in foreign currency.  And he still said
to me at the time, do not worry sir, if it bounces, it bounces, we

are going to go to the bank, but I can tell you now, I want foreign
currency and I do not need to go to your bank.  I said,
I had
just been to my bank but I think it is also safe if we can do that
transaction at the top.  . . . After a little conversation
I
also agreed to say, okay, if you want foreign currency then let us
try and use American Express of which he led me to the American

Express counter.’
[25]
At the American Express counter, Mr Lionel requested US$20 000
and €30 000, and he told the gentleman who was
attending to
him that he was going to use Mr Sibanda’s card to pay ‘because
he had erroneously put money into [his]
account’.  Mr
Sibanda inserted his card into the card machine, entered his pin
number, and the transaction was successfully
processed.  Mr
Lionel received his requested foreign currency.  The withdrawal
from Mr Sibanda’s account in payment
for the foreign currency
was the sum of R448 179.71.   According to Mr Sibanda
he still owed Mr Lionel R12 000.
While the gentleman who
attended to them at the American Express counter was still counting
the foreign currency before handing
it over to Mr Lionel, Mr Sibanda
accordingly offered to go to Standard Bank to withdraw the balance
that he was still owing Mr
Lionel, and he left.  But, before
entering the Standard Bank branch, he received another SMS from
Standard Bank, in his words,
‘confirming that the money has
bounced or it has been reversed, whatever the case might be, or it
has not been honoured’.
He immediately ran back to the
American Express counter in search of  Mr Lionel, but he was no
longer there and the gentleman
at the American Express counter who
attended to them told him that he had given the foreign exchange to
Mr Lionel who then left.
[26]
Mr Sibanda then looked around the airport for Mr Lionel, probably for
about five minutes, and then went back to the Standard
Bank branch.
He spoke to the same lady who attended to him earlier, saying to her-
‘
. . . I
showed you my slip and you said if your slip and your SMS confirm
that the money is in your account it is in your account.
What
more proof do you need from us?  Now I just did a transaction
for a gentleman that said he put money wrongly into my
account and
now this is another SMS that I have got and the lady at the enquiries
at the time told me that, oh, probably this is
a scam.  . . .
I said to the
lady that I came here earlier on so we had a little bit of an
argument obviously being frustrated, panicking that
what had happened
to my account and that I had approached the bank first and they say
the money is in your account which is in
your account.  I got
another SMS that confirmed that the money was not showing into my
account, they have reversed the whole
deal, so that gave me a bit of
aggravation, I must say.  I was aggravated at the time
[indistinct] to say why did you initially
say to me this is the
story, that is why I walked into the bank in the first place because
I wanted help for you to confirm that
this money was genuinely in my
account or not.  . . .
So would you say
sir that you acted in a manner as the representative of the bank that
lady had told you?  That you acted upon
the representation that
she made to you right at the beginning?  - - - Right at the
beginning and it is also to my knowledge
that is why I also went back
to the same lady to say I gave you my slip out of the ATM, I showed
you my cell phone, the SMS and
you say to me if the money is in your
account what more do you want us to confirm? So now there is another
SMS that has come through
and that SMS is saying the deal that I
made, or the cash that I had bought using my card is now been
reversed.  So, I am now
sitting in a minus and I was going to go
into the bank at the time to withdraw the balance of the money, so I
argued with the lady,
that is why I said my lady, forgive me because
obviously I argued a bit because I was aggravated at the time to say
I came to you
first, now this.  What is happening here?’
[27]
Mr Sibanda then went to the SAPS airport satellite station but was
told that they do not investigate such cases and that he
must sort it
out with his bank or go to the nearest police station where he stays
or works.  Mr Sibanda then went to the Sebenza
police station,
which, according to him, is down the road from his house.  There
a Captain Makula suggested to him that he
goes to his office, type
his statement and bring it back to him, which Mr Sibanda did.
He took his typed statement to Captain
Makula the same afternoon or
the next day.  Mr Sibanda did not go to Mauritius.  In this
regard he testified:
‘
I could
not leave whilst there was a big problem on my personal account.
It would have been viewed as I was running away,
even if it was for
two days, but I know logically it was not supposed to be like that.’
[28]
Mr Sibanda’s evidence raises more questions than plausible
answers.  He, an educated man with a prestigious MBA
degree,
used his own flight ticket that he had purchased to fly to Mauritius,
the presentment of which flight ticket and his own
passport enabled
him to buy foreign currency at American Express to the value of R448
179.71 for a complete stranger, whose identity
document, flight
ticket, or deposit slip of the R462 000, it is not suggested, he
even had required to see or indeed had seen.
Mr Sibanda then
did not use his flight ticket to fly to Mauritius for the two-day
business trip for which it was allegedly acquired,
and his
explanation for not doing so is implausible.  Furthermore, he
never enquired from the stranger, who only phoned him
from public
telephones, how the erroneous deposit into his account came about,
how the stranger got his name, bank name and account
number to effect
the deposit or how he got Mr Sibanda’s cell number to require
the repayment of the alleged erroneous deposit.
It is, in my
view, safe to accept that if Mr Sibanda had made any such enquiries
it would have been mentioned in his evidence in
chief, and in his
police statement and affidavit in support of his rescission
application.
[29]
The record of the evidence speaks for itself:  Mr Sibanda’s
evidence in several material respects lacks inherent
plausibility and
is contradictory.  I need only refer to a few external
contradictions in his evidence.  In his founding
affidavit in
support of his rescission application in these proceedings, Mr
Sibanda did not state that his intended travel to Mauritius
was a
business trip.  On the contrary, he stated this:
‘
At the
time I was set to go to Mauritius on holiday.  On the same day
(11 May 2011) I was contacted by one Mr Tony whom informed
me that
the aforesaid amount was mistakenly paid into my bank account.
I accepted this to be true by virtue of the fact that
I did not
expect such a large payment.  We subsequently agreed to get
together in order to arrange a refund of the said monies
to Mr Tony.’
When
Mr Sibanda was confronted under cross-examination with this material
external contradiction in his evidence, he proffered the
following
implausible explanation:
‘
Can you
read the first sentence into the record perhaps? - - - It says “At
the time I was said to go to Mauritius on holiday.”
Remarkable.
Absolutely remarkable.  So when did this business trip develop
into a holiday? - - - Because, when I gave my statement
to my
attorney which was Pistorius and Osborne at the time, he said, “You
have got a lekker job”, in a joking way and
I said, “Why
do you say that?”  He said, “You have got to get a
paid holiday to go to Mauritius.”
I said, “But I am
working.”  He says “But at least, you are afforded
your ability to travel on company expense.”
Is that your
answer? - - - That is my answer,’
[30]
Mr Sibanda could give no plausible explanation for why he drove to
the airport to buy his flight ticket as opposed to booking
it online
or even telephonically - he said he did so because the airport was 10
to 15 minutes away from his office.  Furthermore,
one would
expect the flight tickets of Mr Sibanda and the colleague who was
supposed to accompany him to Mauritius to be booked
together in order
for them to investigate the business opportunity at the same time,
particularly in the light of Mr Sibanda’s
evidence that they
needed to be in Mauritius on the Saturday, 14 November 2011.
[31]
Mr Sibanda’s evidence that he had gone to the Standard Bank
branch at the airport where the alleged representation had
been made
to him prior to meeting Mr Lionel and effecting the transaction at
American Express, is improbable and not credible.
In his police
statement, which, according to him, he prepared and submitted to
Captain Makula the same afternoon or the next day,
no mention was
made by him that he had gone to the Standard Bank branch at the
airport while he had been waiting for Mr Lionel
and before he had met
him and that he had shown the lady in attendance at the enquiries
desk of that branch the ATM slip that he
earlier had received when he
had withdrawn R2 500 cash at an ATM as well as Standard Bank’s
SMS on his cell phone, and that
she had said to him that the slip
‘says there is money in your account’ and that ‘you
have got an SMS and you
have got a slip, so what more confirmation
would you need from the bank?’
[32]
On the contrary, according to Mr Sibanda’s police statement, he
had only gone to the Standard Bank branch at the airport
after he had
paid for the purchase of the foreign currency at American Express in
order to draw the balance that he had still owed
Mr Lionel.  In
this regard his police statement reads as follows:
‘
One guy
walked with me to American Express to do the transaction while the
other stood a few metres away in the public.  To
my surprise my
card managed to go through for the purchase of 20 000.00 US
dollars as well a
s 30
000.00
Euros and all this came to + -
R448 000.00.  I took all the money and gave it to the guy
who was constantly with me to
make sure I do the transaction.
The balance of +- R12 000.00 I then told them that we should
walk to the upper floor
to my bank where I could withdraw it for them
in cash.  The two guys then offered to remain downstairs
counting their money
as they needed to purchase a few items while I
run to my Standard Bank upstairs.  As I was almost a few steps
away from entering
the bank another sms came through to say the money
deposited into my account earlier on was stopped or bounced whatever
the case
might be.  I quickly made a u-turn and ran downstairs
to check on the two guys before they left but to my surprise I could

not find them.  I again ran upstairs to Standard Bank and asked
by the enquiries what had happened with the money wrongfully

deposited into my account.  The lady by the enquiries told me
that the owner had stopped it and I explained to her what had
just
happened and she said she thought at the time it was a scam.
She advised me to go to the police downstairs of which
I did and an
officer there advised me that I should speak to my Bank as they are
the one who had allowed such an amount to go through.
I again
went to Standard Bank upstairs where I was advised to phone the
0800222050 number so that I can report the crime.
I tried this
number several times but could not get through.’
[33]
The explanation proffered by Mr Sibanda under cross-examination as to
why a significant component of his version - that he
attended at the
Standard Bank branch prior to meeting Mr Lionel where a Standard Bank
official made the representation to him regarding
the monies being in
his bank account – had not been included in his police
statement that he had prepared shortly after the
event, is that
Captain Makula had told him ‘to be precise and to the point’
when he drafts his statement and that it
should not be more than two
pages.  Yet, Mr Sibanda was unable to explain why insignificant
detail, such as him buying a cold
drink at the airport while he had
been waiting for Mr Lionel, was then included in his police
statement.
[34]
What further demonstrates the mendaciousness of Mr Sibanda’s
evidence in this regard is the fact that in his police statement
no
mention was made that when he had gone to the Standard Bank branch at
the airport after the fact, he had confronted the same
bank official
who earlier attended to him at the enquiries desk of that branch
about the representation which she had earlier made
to him, that he
had an argument with her and that he had been aggravated and angry as
a result thereof.  On the contrary,
his evidence and his police
statement are also contradictory regarding his attendance at the
Standard Bank branch at the airport
after the event.  In his
police statement he merely stated that the lady at the enquiries desk
had told him that the owner
had stopped payment, that he had
explained to her what had just happened and that she had said she
thought it was a scam.
[35]
But even if it is accepted that Mr Sibanda had gone to the Standard
Bank Branch at the airport prior to meeting Mr Lionel and
paying for
the foreign currency, I cannot find any factual basis for holding
that Standard Bank made any misrepresentation to Mr
Sibanda, and most
importantly for finding that there was any special arrangement with
Standard Bank that if he draws against uncleared
effects and such
effects were subsequently dishonoured, Standard Bank would not be
entitled to debit his account with the amount
of such dishonoured
cheque.  It emerged during the course of the cross-examination
of Mr Sibanda that his version is that
the Standard Bank official
represented to him that the deposit of R462 000, according to the
Standard Bank SMS on his phone and
the ATM receipt, was available to
him for withdrawal purposes and he expressly conceded that it was not
represented to him that
the effects were cleared or that if the
cheque deposited to his bank account was not paid that the bank would
not be entitled to
debit his account with the amount of that cheque.
This, at the time was exactly the correct factual position.
There was no misrepresentation on the part of the bank
official.  Mr Sibanda, therefore, has failed to prove any facts
or circumstances
disentitling Standard Bank from debiting his account
with the value of the uncleared effects when those effects were
subsequently
not paid.  (See
IW Blumberg and Wilkinson
at
681D-I;
Sarwan
at 56c-e.)
[36]
In his plea Mr Sibanda also averred that Standard Bank ‘through
its authorized representatives acted fraudulently alternatively

negligently in that’,
inter alia
, ‘it granted
credit to [him] recklessly when it extended a sum of money in excess
of R24 400.00’ and it ‘should
have known and/or foreseen
that . . . [t]he extension of credit beyond the amount of R24 400.00,
as agreed, would amount to reckless
credit as envisaged in terms of
the
National Credit Act, No. 34 of 2005
’.  This is the sum
of Mr Sibanda’s plea of reckless credit.  A defence of
reckless credit constitutes a defence
on the merits (see JW Scholtz
et al
Guide to the
National Credit Act
Commentary
at 11-126)
and must be properly raised by way of plea (see
Absa Bank Limited
v Vorster
2018 JDR 1715 (GP) para 72;  Harms
Amler’s
Precedents of Pleadings
Eighth Ed at 140 and 143).
[37]
Reckless credit agreements are defined in
s 80(1)
of the
National
Credit Act, which
reads:
‘
A credit agreement is reckless
if, at the time that the agreement was made, or at the time when the
amount approved in terms of
the agreement is increased, other than an
increase in terms of
section 119(4)
-
(a)
the credit provider failed
to conduct an assessment as required by
section 81(2)
, irrespective
of what the outcome of such an assessment might have concluded at the
time; or
(b)
the credit provider, having
conducted an assessment as required by
section 81(2)
, entered into
the credit agreement with the consumer despite the fact that the
preponderance of information available to the credit
provider
indicated that-
(i)
the consumer did not generally
understand or appreciate the consumer’s risks, costs or
obligations under the proposed credit
agreement; or
(ii)
entering into that credit
agreement would make the consumer over-indebted.’
[38]
A court that declares a credit agreement reckless in terms of
s
80(1)
(a)
or
80
(1)
(b)
(i) may, in terms of
s 83(2)
, make
an order setting aside all or part of the consumer’s rights and
obligations under that agreement, as the court determines
just and
reasonable in the circumstances, or suspending the force and effect
of that credit agreement in accordance with subsection
(3)
(b)
(i).
If the court declares a credit agreement reckless in terms of
s
80(1)
(b)
(ii), the court, in terms of
s 83(3)
-
‘
(a)
must
further consider whether the consumer is over-indebted at the time of
those proceedings; and
(b)
if the court or Tribunal,
as the case may be, concludes that the consumer is over-indebted, the
said court or Tribunal may make
an order-
(i)
suspending the force and effect
of that credit agreement until a date determined by the Court when
making the order of suspension;
(ii)
restructuring the
consumer’s obligations under any other credit agreements, in
accordance with
section 87.
’
[39]
Mr Sibanda did not plead on what basis the conclusion is drawn that
in permitting him to draw against the uncleared effects
of the cheque
deposit in question, Standard Bank concluded a credit agreement with
him, on which ground or grounds he relies for
averring that the
credit agreement is reckless in terms of
s 80
, nor did he claim the
setting aside of all or part of his rights and obligations under the
agreement (if permitting him to draw
against the uncleared effects of
the cheque deposit can be said to be a credit agreement as
contemplated in the
National Credit Act, and
I am not making any
finding in this regard), or for the suspension of the force and
effect of such alleged agreement.
[40]
Furthermore, the question of reckless credit was hardly touched upon
in the evidence, let alone fully canvassed. The sum of
Mr van der
Walt’s evidence on the question is that in permitting Mr
Sibanda to draw against the uncleared effects of the
cheque deposit
in question, Standard Bank did not approve or grant an overdraft
facility to Mr Sibanda in the amount of R260
000, nor did Mr Sibanda
apply to Standard Bank for such a facility.  In his view,
permitting a client to draw against uncleared
effects amounts to
‘incidental’ credit, but not to an ‘incidental
credit agreement’ as defined and contemplated
in the
National
Credit Act.  In
this regard he testified:
‘
I term it incidental credit
because, a.) The client did not apply for an actual facility, so he
did not come to me and say, listen,
I want to draw against this
cheque; however, if it bounces, please give me an overdraft facility
up to and including R490 000,
or whatever it is.  It is
incidental in nature in that nobody anticipated, I do not think Mr
Sibanda anticipated it, neither
did Standard Bank anticipate it.
So that is why I say, hum . . .
Anticipate what?  ---  The
extent of the overdraft or what actually happened.  That is why
I say it is incidental.
It was not granted in terms of the
normal rules of the
National Credit Act, which
require me as a banker
to ensure that the client has a source of repayment, has a means of
payment, can afford the debt.
None of that featured in this
thing.’
(Sections
81
to
84
, and any other provisions of
Part D
of the
National Credit
Act to
the extent that they relate to reckless credit, do not, in
terms of
s 78(2)
(e)
, relate to ‘an incidental credit
agreement’ as defined in
s 1.)
Mr van der Walt further
referred to the credit balance of Mr Sibanda’s account in the
amount of approximately R490
000 at the time when he made payment for
the foreign currency in support of his contention that in permitting
him to draw against
the uncleared effects of the cheque deposit,
reckless credit was not granted to him.
[41]
The only aspects of Mr Sibanda’s evidence that have any bearing
on the question of reckless credit is that Standard Bank
afforded him
an overdraft facility of only R24 400 and that he owns a house to the
value of R700 000, which property is burdened
with a mortgage bond in
favour of Standard Bank.  The amount owing by him to Standard
Bank in respect of that mortgage loan
is R130 000.
[42]
A special plea of reckless credit not having been properly raised on
the pleadings nor fully canvassed in the evidence render
it
unnecessary and undesirable for me to consider the question whether a
financial institution permitting an account holder to
draw against
uncleared effects of a cheque deposit into the account may in a given
situation amount to a credit agreement that
is reckless as
contemplated in
s 80(1)
of the
National Credit Act, in
circumstances
where the provisional credit to the account is reversed when effects
giving rise to such credit are not cleared.
It is an important
question since payments by way of cheques in this country are still
appreciable, in volume and value.
[43]
Nevertheless, bearing in mind the application of the
National Credit
Act
(‘. . . to every credit agreement between parties dealing
at arm’s length and made within, or having an effect within,

the Republic, except’ those listed in
s 4)
, the definition of a
‘credit agreement’ in
s 1
(‘’. . . an
agreement that meets all the criteria set out in
section 8
’),
the criteria set out in
s 8
that ‘an agreement constitutes a
credit agreement for the purposes of this Act if it is . . . a credit
facility . . . a credit
transaction . . .  a credit guarantee .
. . or . . . ‘any combination of the above’ (subsection
(1)) and the description
of each given in subsections (3), (4) and
(5), I do not think (and this is not a definitive finding) that a
financial institution,
in permitting an account holder to draw
against uncleared effects of a cheque deposit, and the account holder
made a credit agreement
to which
sections 81
to
84
and any other
provisions of
Part D
of the
National Credit Act relating
to reckless
credit apply, if the uncleared effects were not met, the account
debited as a result and the overdrawn balance repayable
immediately.
In
Vorster
para 130, Prinsloo J rejected the contention that
the fact that the account holder ‘was allowed, on a limited
basis, to draw
against uncleared effects, amounted to an overdraft or
“a loan” resulting in a “credit agreement” in
the
spirit of the NCA’.
[44]
In the result the following order is made:
(a) The defendant is to
pay the plaintiff the amount of R472 996.66 plus interest thereon at
the rate of 15.5% per annum from 25
August 2011 to date of payment.
(b) The defendant is to
pay the plaintiff’s costs of suit.
P.A.
MEYER
JUDGE
OF THE HIGH COURT
Date
of hearing: 25 April 2019
Date
of judgment: 28 November 2019
Plaintiff’s
counsel: Adv JC Viljoen
Instructed
by: Stupel & Berman Inc., Germiston
Defendant’s
counsel: Adv I Oschman
Instructed
by: Lingenfelder & Baloyi Attorneys, Kempton Park