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[2010] ZAGPPHC 611
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Erasmus v Jensen (22746/2005) [2010] ZAGPPHC 611 (5 May 2010)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
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SAFLII
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IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG, HIGH COURT PRETORIA)
CASE NO: 22746/2005
DATE: 5 MAY 2010
In the matter
between:
MARTINUS THEUNIS
STYN
ERASMUS
.........................................................................................
Appellant
and
FLEMMING
JENSEN
..........................................................................................................................
Defendant
JUDGMENT
MAKGOKA.
J
:
[1] This is a
judgement on an action brought by the plaintiff for payment of a
balance of a loan. In his simple, supplemented by
a declaration, the
following allegations were made:
“
Plaintiff’s
claim against Defendant is for payment of the amount of R1 150 694.76
being monies lent and advanced by the Plaintiff
to Defendant during
June 1997 and which amount is due and payable by Defendant to
Plaintiff and which amount Defendant despite
demand refuses and/or
neglects to repay to Plaintiff’
[2] In his plea, the
defendant admitted the conclusion of a loan agreement with the
plaintiff during 1997 in terms which he borrowed
the sum of US $60
000.00 from the plaintiff. He further admitted that he signed
annexure “A” to the plaintiffs declaration.
He denied
however, that he borrowed any monies from the plaintiff in South
African rands (ZAR). All other allegations were also
denied.
[3] During the
pre-trial conference, it was agreed that the defendant had repaid an
amount of R441 800. 00 over the period between
February 2002 to
February 2009.
EVIDENCE
[4]
Only the plaintiff testified. The defendant did not testify and
closed his case without calling any witnesses. During the plaintiffs
evidence it became clear that the amount claimed was lent and
advanced to the defendant over a period of time prior to June 1997.
The plaintiff testified that in March 2001, the defendant signed a
document with the heading
“
Promissory
Note”.
The
relevant parts of the document read as follows:
I.
For value received, the undersigned,
Flemming
Jensen
Passport
no. A[...] of 4[...] C[...] F[...] Court, C[...], MARYLAND 21044 USA
(the “Maker”) promises to pay to the order
of MTS
ERASMUS, ID 3[...] of 2[...] G[...] St. Carslwarld Midrand, SOUTH
AFRICA, (the “payee”), the principal sum of
Ninety Three
Thousand, U.S. DOLLARS ($93 000.00), which includes interest for the
period 15
th
July 1997 to 15
th
March 2001.
III. 50% of this
Note shall become fully due and payable at the demand of the Payee,
which demand shall not occur prior to 15
th
March 2001. The
payments shall be paid in full as set out above by Maker within ten
(10) calendar days after the Payee makes a
written or oral demand
thereof. Said payments shall be sent to the Payee at the address set
forth above or at other address as
the Payee may communicate to Maker
as part of this demand for payment.
IX This Note is
payable in U.S. currency, and the terms hereto shall be governed by
the laws of the State of Ohio, U.S.A. If any
provision hereto is
deemed invalid or enforceable by a court of competent jurisdiction
such shell be deemed valid or enforceable
to the fullest extent
permitted by law and the validity or enforceability of the remaining
provisions shall not in any way be effected
thereto.
[5] On 12 June 2003,
the defendant wrote a letter to the plaintiff, wherein a further
acknowledgement of his indebtedness to the
plaintiff in an amount of
R1, 140. 000.00 was made by the defendant. The full text of the
letter read as follows:
Dear Tins,
This letter will
serve two purposes:
1. To acknowledge
the indebtedness to you for a total amount of R1, 140,000.00 (One
Million one hundred forty thousand Rand) comprising
monies lent over
a lengthy period of time as well as interest thereon.
Said amount is
owed to you by the undersigned in an individual capacity.
2. Repayment will
occur along with the cash flows generated by our wholly owned
subsidy, Witbank Housing Corporation’s Presidential
Job Summit
Social Housing 5,000 housing unit project, currently being
constructed in Witbank, and a firm schedule for the repayment
will be
forthcoming very soon, as this is being completed by the various
parties involved in the project.
To put this into
perspective, please, understand that we will deliver the first
“super- block” - comprising 180 housing
units - at the
end of this month, and one such super-block at the end of every month
following for a total of 20 super-blocks.
Each delivery
will be invoiced by Witbank Housing Corporation for a developer’s
fee of R1 million-and out of which I will
ensure repayment of the
indebted amount and, as stated in the above, a schedule for such will
be forthcoming soon.
In hoping that
this will satisfy your request for directions in this matter, I
remain.
Sincerely yours
Flemming Jensen
Chairman
[6] The plaintiff
further testified that up to the time of the trial, he had been in
regular contact with the defendant about the
outstanding debt. Each
time the defendant would make a promise of payment. During the past 4
years of issue of summons, the defendant
has never denied his
indebtedness to him. As recently as the week preceding the trial, the
defendant sent him two text messages
on his cellphone, promising
payment. He also had a drink with the defendant who told him that he
did not wish the matter to proceed
to trial as he wished to settle
the debt before the trial date.
[7]
The repayments by the defendant to him were made in ZAR, although
there were no payments in 2006, 2007 and 2008. Each time he
received
a payment from the defendant, he would convert it to USD with that
day’s exchange rate, which rate he obtained from
the
Business
Day
newspaper,
and reduced the loan account accordingly.
[8] At the end of
2002/ beginning of 2003, the parties had a meeting in Sandton, where
the parties agreed that the subsequent payments
would be in dollars.
However, he never received payment in dollars. It was then agreed to
convert the amount of the loan into the
rand. This agreement,
although never reduced to writing by the parties, was recorded by the
plaintiff subsequent to the meeting,
in a letter dated 3 January
2003.
[9] The plaintiff
explained how he converted the outstanding USD amount to rand as
follows: At the end of December 2002, the outstanding
loan amount to
USD 109 846. 57. At that time, the USD/ZAR exchange rate was just R10
a dollar. When the loan was converted to Rand,
the loan amounted to R
1 098 465. 70. He further testified that the claim amount of R1 210
694. 76, was the outstanding balance,
plus interest at the time
summons was issued.
[10] As to the
calculation of interest, the plaintiff testified that at the end of
every month, he added one twelfth interest on
the outstanding amount.
This interest he calculated from 15 March 2001. In this regard the
plaintiff confirmed his manuscript schedule
of interest and
outstanding balances.
[11] During
cross-examination, the plaintiff conceded that he did have the exact
loan amount without interest. Other than that,
nothing came of the
cross-examination, which was limited to the above issues only. The
defendant’s version was also not put
to the plaintiff.
[12] That concluded
the plaintiffs case. An application for absolution from the instance
on behalf of the defendant at the close
of the plaintiffs case was
made, which I dismissed. The defendant then elected to also close his
case, without testifying or calling
any witnesses.
[13]
Mr.
Bester,
counsel
for the defendant, argued for the dismissal of the plaintiffs claim.
As I understood counsel’s argument, the basis
for his
submission is three-fold. First, that the plaintiff was unable to
clearly state the loan amount and the interest charged,
with any
certainly. Secondly, that the “promissory note”, being
annexure “A”, did not incorporate any other
terms save
for those in the agreement. The upshot of this, counsel argued, was
that the conversion of the amount stated in annexure
“A”,
was not part of the agreement, and therefore any evidence purporting
to prove such conversion, was inadmissible,
irrelevant and
prejudicial to the defendant, as the conversion was not ventilated in
the pleadings.
[14]
Thirdly, that there was insufficiency of evidence as the plaintiff
failed to tender expert evidence as to the exchange rate
between the
USD and the ZAR. The plaintiff’s evidence that he obtained such
exchange rate from
Business
Day
newspaper,
was, according to Mr.
Bester,
hearsay.
[15]
Considered in isolation, one might be persuaded to accept Mr.
Bester’s
argument.
However, all these submissions, cannot be considered in
vacuo.
They
should be considered in the light of the totality of the evidence
before court. In my view, three aspects significantly erode
Mr.
Bester’s
submissions.
[16] First, as
regards the amount of the loan amount, it is significant that the
defendant himself, in a letter dated 12 June 2003,
acknowledged
indebtedness to the plaintiff for a total amount of R1 140 000.00
(one million one hundred forty thousand rand) comprising
monies lent
over a period of time as well as interest thereon. The correctness of
the contents of the said letter, had never being
placed in dispute.
The date of the letter is also significant to the argument that there
was no agreement to convert from USD to
ZAR.
[17] It will be
recalled that the plaintiff testified that the conversion was agreed
to during December 2002/ January 2003. The
conversion was recorded in
a letter by the plaintiff to the defendant on 3 January 2003. The
receipt of such a letter by the defendant,
and the correctness of the
contents thereof, have similarly, not been disputed by the defendant.
The plaintiffs letter of 12 June
2003, if anything, fortifies the
fact there was indeed an agreement to convert.
[19] It is also
significant, that in the manuscript schedule reflecting the balance
and interest charged at various dates, the balance
owing as at end of
April 2003, is R 1 139 658.00, a mere R342.00 short of the R1 140
000.00 which the defendant himself acknowledged
to be owing towards
mid June 2003.
[20] It is
therefore, in my view, incorrect that defendant would have been
prejudiced by the evidence relating to conversion from
USD to ZAR. He
was party to an agreement in this regard. He himself set out the
converted amount with some measure of accuracy
as at mid June 2003,
as more fully set out in the preceding paragraph. It becomes
irrelevant therefore, in my view, to consider
the evidence as to how
the plaintiff arrived at the claim amount, or the method used for
conversion. The defendant himself had,
at the risk of repeating
myself, provided proof of agreement to convert, as well as the
converted amount. The defendant himself
made payments to the
plaintiff in ZAR.
[21] Even if I am
wrong in the view I take of this aspect, the central consideration is
always that of fairness and justice. Put
differently, whether the
evidence relating to the conversion, not pleaded, was prejudicial to
the defendant.
[22] Shorn all of
its cursory and cosmetic complexities, this is a simple matter, based
on a written acknowledgement of debt. The
agreement to convert, was
not new to the defendant. Although not specifically pleaded, it was
in no way new to the defendant. It
was not sprung upon him as a
surprise in evidence. It was based on two letters, one written by
him. He decided not to testify to
challenge the correctness of the
contents of the letters.
[23]
In
Mastlite (Pty)
Ltd v Stavracopolous
1978
(3) SA 296
(T) the following was stated at 299 D-E:
“
What,
must, in my view, be emphasised is that the contemplated departure
from the pleadings must not be such as to cause prejudice
and that
the new issue or matter should have been fully canvassed by both
parties to the extent that it virtually amounts to a
tacit agreement
between them to enlarge the scope of the pleadings. Both parties must
willingly participate in the effort, to canvas
the new issue,
otherwise the possibility of prejudice must almost inevitably arise
which would be fatal to any attempt to depart
substantially from the
pleadings. ’’
[24]
Mr.
Bester,
also
refered me to the case of
EC
Chenia and Sons CC v Lamé & Van Blerk
[2006] ZASCA 10
;
2006
(4) SA 574
(SCA), wherein a proper approach was restated with regard
to departure from the issues raised in the pleadings. It was
reiterated
that the question is one of prejudice. I have already
found that there could not have been prejudice to the defendant in
the circumstances
of the present case.
[25] The above
should take care of the last contention concerning the exchange rate
at the time of conversion. I therefore do not
consider it necessary
to address this aspect any further.
[26] The cumulative
effect of the above is that I am satisfied, given the totality of the
evidence, that the plaintiff has proven
his case on a balance of
probabilities. The amount of R441 800.00 that had already been paid
by the defendant should be deducted
from the claim amount.
I therefore make the
following order:
1. The defendant is
ordered to pay an amount of R768 894.76 to the plaintiff.
2.
Interest on the said amount at 15.5 % p.a
tempore
morae.
3. The defendant is
ordered to pay the costs hereof
T M MAKGOKA
JUDGE OF THE HIGH
COURT
DATE HEARD: 28
OCTOBER 2009
JUDEGMENTHEARD: 5
MAY 2010
FOR THE PLAINTIFF:
ADV G SWANEPOEL
INSTRUCTED
BY :
JOHN
TRIBELHORN ATTORNEYS
PRETORIA
FOR THE DEFENDANT:
ADV A BESTER
INSRTUCTED
BY :
MATTHEW
KERR-PHILLIPS
,
JOHANNESBURG
AND
FRIED LAND HART
& PARTNERS,
PRETORIA