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[2013] ZASCA 128
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Stabilpave (Pty) Ltd v South African Revenue Services (615/12) [2013] ZASCA 128; 2014 (1) SA 350 (SCA); 75 SATC 347 (26 September 2013)
THE SUPREME COURT OF
APPEAL OF SOUTH AFRICA
JUDGMENT
REPORTABLE
Case No: 615/12
In
the matter between:
STABILPAVE (PTY)
LIMITED
....................................................................
APPELLANT
and
SOUTH
AFRICAN REVENUE SERVICES
..............................................
RESPONDENT
Neutral citation:
Stabilpave v SARS
(615/12)
[2013] ZASCA 128
(26 September 2013).
Coram:
Brand,
Lewis, Bosielo, Theron JJA and Meyer AJA
Heard:
12
September 2013
Delivered: 26
September 2013
Summary: Payment –
Cheque sent through post stolen before it reached payee –
Whether tax assessment form, on a proper
construction thereof,
afforded creditor a choice as to the mode of payment, and, if it did,
whether creditor made a choice, expressly
or by necessary
implication, that payment should be effected by a cheque through the
post, and creditor thereby assuming risk of
loss of the cheque –
Defence of payment dismissed.
___________________________________________________________________
ORDER
___________________________________________________________________
On appeal from:
Full
Court of the North Gauteng High Court, Pretoria (Mavundla, Fabricius
and Mothle JJ).
1. The appeal is upheld
with costs.
2. The order of the court
a quo dismissing the appellant’s appeal with costs is set aside
and there is substituted an order
which reads:
(a) The appeal is upheld
with costs.
(b) Judgment is granted
in favour of the plaintiff against the defendant for:
(i)Payment of the sum of
R724 494.29;
(ii) Interest
a
tempore morae
on the aforesaid sum at the rate of 15.5 percent
per annum from 17 October 2006 until date of payment;
(iii) Costs of suit.
___________________________________________________________________
JUDGMENT
MEYER AJA(BRAND,
LEWIS, BOSIELO and THERON JJA concurring)
[1] This is an appeal
against a judgment of the Full Court of the North Gauteng High Court
dismissing an appeal against the judgment
and order of Ismail AJ,
sitting as court of first instance. The court of first instance
dismissed with costs the claim of the appellant,
Stabilpave (Pty)
Ltd, against the respondent, the South African Revenue Service, for
payment of the sum of R724 494.29 plus interest
and costs. I shall
refer to the parties as SARS and Stabilpave. SARS posted a cheque to
Stabilpave’s postal address for the
amount and interest
claimed, but the cheque was stolen and paid to a thief.
[2] The parties agreed on
a written statement of facts. SARS owed Stabilpave a tax refund of
R724 494.29. This amount was reflected
as the amount due to
Stabilpave on the tax assessment form (IB34) dated 16 October 2006
which was issued to Stabilpave. The core
issue between the parties
concerns the interpretation of the following notice that was included
in the tax assessment form:
‘
Die
kredietbedrag wat nou op u belastingrekening reflekteer word
eersdaags aan u betaal. Hierdie betaling sal geskied deur middel
van
‘n tjek wat by u naaste Poskantoor afgehaal kan word OF indien
geldige bankbesonderhede beskikbaar is sal ‘n elektroniese
oorbetaling gemaak word deur gebruik te maak van die bankbesonderhede
soos per u belastingrekord.
Nota: Die kredietbedrag aan u
terugbetaalbaar verteenwoordig die kredietbedrag soos gereflekteer op
u belastingrekening op datum
waarop die tjek of elektroniese
oorbetalingstransaksie gegenereer is. As gevolg van finansiele
transaksies wat moontlik mag plaasvind
op u belastingrekening tydens
die datum van uitreiking van hierdie aanslag en die datum waarop die
terugbetaling gegenereer is,
mag die bedrag derhalwe terugbetaal
verskil van die bedrag getoon as VERSKULDIG AAN U op hierdie aanslag.
U huidige bankbesonderhede soos
per u belastingrekord is soos volg:
Naam van bank en tak
Taknommer
Tipe rekening
Rekeningnommer
Geliewe kennis te neem dat
indien hierdie besonderhede nie geldig is tydens die prosessering van
die kredietbedrag op u rekening,
sal die terugbetaling van die
kredietbedrag geskied deur middel van ‘n tjek wat aan u naaste
Poskantoor gestuur sal word
vir kollektering.’
[3] The essential facts
are these. The banking details of Stabilpave were not available to
SARS. A cheque, dated 12 November 2006,
made payable to Stabilpave
for the sum of R728 474.74, being the amount of the refund that was
due to Stabilpave plus interest
that had accrued thereon until 12
November 2006, was drawn by SARS on ABSA Bank Ltd, at its Vermeulen
Street, Pretoria branch.
The cheque was crossed and marked ‘not
transferable’. SARS handed the cheque in a sealed envelope
(addressed to Stabilpave’s
post-box number at Menlyn Retail
Post Office) to Securemail, a division of the South African Post
Office. Securemail caused a delivery
notification to be issued.
Neither Stabilpave nor anyone representing it received the delivery
notice. It got into the hands of
a stranger to the parties, one
Mbukuman Wellington Mtima, who collected the envelope containing the
cheque from the Menlyn Retail
Post Office. Mtima succeeded in
stealing the cheque by presenting the delivery notice as well as a
fake letter that professed to
be from a firm of accountants, Prinsloo
& Du Plessis, and authorising the collection.
[4] The particulars of
the directors of Stabilpave (JM Geyser, JE Raubenheimer and F Kenney)
were fraudulently changed in the records
kept by the Registrar of
Companies to reflect one Petros Mandla Radebe as its sole director.
Radebe, acting fraudulently and without
the authority of Stabilpave,
opened a bank account with First National Bank, Hatfield Branch, in
the name of ‘Stabilpave
(Pty) Ltd’. The cheque was
deposited at First National Bank, Menlyn Branch and the account
opened by Radebe was credited
with the amount of R728 474.74. The
cheque was presented for payment to ABSA Bank which duly paid that
sumto First National Bank
and the account of SARS was debited with
the amount paid. The proceeds of the cheque were withdrawn by Radebe,
ostensibly acting
as a director of Stabilpave, over a relatively
short period.
[5] Stabilpave instituted
action against SARS for payment of the tax refund which became due
and payable to it on 16 October 2006
plus interest and costs. SARS
admitted the debt but raised the defence of payment. In the
alternative it raised a defence ‘...
based on the wording of
the assessment ...’, which is that by not providing any banking
details to SARS in order for the
payment to have been effected by
electronic transfer, Stabilpave ‘... elected, alternatively
accepted that payment be effected
by way of a cheque which would be
collected at the nearest post office ...’ to Stabilpave.
[6] Stabilpave’s
contention is that the obligation of SARS to pay the tax refund to it
has not been fulfilled because in law
there is no payment if a cheque
is posted and lost before it reaches the creditor.
1
SARS’s contention,
on the other hand, is that its obligation to pay the tax refund is
legally deemed to be fulfilled even
though the amount of the cheque
was never credited to Stabilpave. The tax assessment form, on a
proper construction, it argued,
afforded Stabilpave the choice as to
the mode of payment – by cheque through the post, or by
providing its banking details,
by means of electronic transfer. By
not providing its banking details Stabilpave chose to be paid by
cheque through the post. SARS
relies on the trite legal principle
‘... that if a creditor requests a debtor to settle his debt by
sending a cheque through
the post he agrees to run the risk in the
transit’.
2
[7] The court of first
instance acceptedthe contention of SARS,
and
the claim of Stabilpave was accordingly dismissed with costs. The
judgment of Ismail AJ has elicited comment from the authors
CJ Nagel
and JT Pretorius
3
who expressed the view
that the notification under consideration cannot be construed as an
agreement between the parties or as a
request that payment be made by
cheque and be posted to the creditor.
[8] The majority of the
Full Court - Mavundla J and Mothle J concurring - held that
‘
. . .
the only plausible inference to be made was that there was a tacit
agreement that remittance of payment should be done through
registered post’,
and that Ismail AJ
‘
. . .
correctly found that the appellant made a choice as to how the cheque
was to be remitted per post, and that the risk lied
[sic] with the
appellant’.
The dissenting view of
Fabricius J is to the effect that the existence of any agreement
relating to the mode of payment was not
established and that
‘
. . .
the relevant notification does not contain any indication to the
appellant that it was entitled to express its approval or
disapproval
with the intended mode of payment. . . . The assessment read as a
whole, simply and clearly indicates that because
respondent did not
have the banking details of appellant, payment would be made by
cheque posted to the nearest post office . .
.’.
[9] The principles to be
applied in cases where cheques have been intercepted in the post and
misappropriated by a thief have been
concisely summarised by Nienaber
J in
Mannesmann
Demag (Pty) Ltd v Romatex
4
thus:
‘
When
a debtor tenders payment by cheque, and the creditor accepts it, the
payment remains conditional and is only finalised once
the cheque is
honoured. (
Eriksen
Motors (Welkom) Ltd v Protea Motors, Warrenton, and Another
1973
(3) SA 685
(A) at 693; Christie
The
Law of Contract in South Africa
at
413.) Until that happens a real danger exists that the cheque may be
misappropriated or mislaid and that someone other than the
payee may,
by fraudulent means, convert it into cash or credit, for instance, by
forging an endorsement or by impersonating the
true payee. That risk
is the debtor’s since it is the debtor’s duty to seek out
his creditor.
But when the
creditor stipulates (or requests) a particular mode of payment and
the debtor complies with it, any risk inherent in
the stipulated
method is for the creditor’s account. That is said to be “the
legal position” (
Greenfield Engineering Works (Pty) Ltd v
NKR Construction (Pty) Ltd
1978 (4) SA 901
(N) at 908B-E), “the
principle”, or “the law” (
Barclays National Bank
Ltd v Wall (
...
[1983 (1) SA 149
(A)] at 156H-157C)), at least
when the post is to be employed for that purpose. And of necessity
that must mean that, if the worst
comes to the worst and the cheque
is intercepted and misappropriated by a thief, the obligation to pay
is deemed to be fulfilled
even though the amount of the cheque was
never credited to the creditor. (Cf
Goldfields Confectionery and
Bakery (Pty) Ltd v Norman Adam (Pty) Ltd ...
[1950 (2) SA 763
(T)]at 769).)
A stipulation of
this sort may of course form part of the agreement creating the debt
which is due to be paid but it does not have
to be so. More often
than not the request only reaches the debtor thereafter. In that
event, if the debtor accedes to the request,
the parties have reached
agreement about the particular mode of performance to be employed in
that particular instance. It is a
term of this subsequent agreement
that the creditor assumes the risks of any inadequacies in the method
selected by him. And to
the extent that it is presented, as it
invariably is, as a proposition of law, the term becomes one that is
implied by law.
The implied term
is not, however, inviolable. In the
Greenfield Engineering Works
case
supra
at 908E, Hoexter J spoke of ‘the
agreement as to the manner of payment’ and eventually
concluded, at 911A:
‘
Looking
at the evidence as a whole I find myself driven to the conclusion
that in the agreement of the parties that the cheque be
sent by post
it was a tacit term (1) that the cheque should be crossed, (2) that
the cheque should name the payee as “Greenfield
Engineering
Works (Pty) Ltd” and (3) that the cheque should be drawn
payable to order.’
What the Court in
effect decided was that the term
ex lege
must yield, in the
circumstances of that case, to the three tacit terms
ex consensu
.’
[10] It is clear from
thispassage that any agreement ‘about the particular mode of
performance’ or ‘as to the
manner of payment’ is
reached onlyif the creditor stipulates (or requests or authorises) a
particular mode of payment and
the debtor accedes to the request. The
decisive question in the present case is whether the notice contained
in the tax assessment
form gave Stabilpave a choice as to a mode of
payment, and, if it did, whether the choice was made by Stabilpave,
expressly or
by necessary implication, that SARS should effect
payment by means of sending a cheque through the post. The parties
are ad idem
that only the tax assessment form must be looked at in
order to determine the first question.
[11] A plain reading of
the notice contained in the tax assessment form leads to the
inevitable conclusion that it does not give
a taxpayer, in this
instance Stabilpave, a choice as to a mode of payment to be followed
by SARS. The notice concerns the factual
position as at 16 October
2006, which is the date of the tax assessment form. SARS informs the
taxpayer that the credit amount
reflected on its tax statement will
be paid to the taxpayer shortly (‘eersdaags’). The
taxpayer is then informed of
the manner of payment. It will be
effected either by means of a cheque that could be collected at the
taxpayer’s nearest
post office or by means of an electronic
transfer, if valid banking particulars are available. The banking
particulars that will
be used are those reflected in the taxpayer’s
tax record. If banking particulars are not valid – forexample,
a branch
or account number has been erroneously captured – at
the time of processing the credit amount on the taxpayer’s
account,
then payment will be made by cheque through the post. No
time limit for the processing is given.
[12] There is no
invitation, expressly or by implication, to the taxpayer to furnish
banking particulars should the taxpayer wish
to be paid by means of
electronic transfer. If there was such invitation one would have
expected the taxpayer to be informed that
payment would be effected
by means of an electronic transfer, if valid banking particulars were
available or furnished by the taxpayer.
A further and clear
indication that the notice does not afford a choice as to the manner
of payment is the absence of a cut-off
date on or before which the
taxpayer might furnish its banking particulars to SARS. Instead, the
taxpayer is informed that payment
will be made soon. The notice is
merely for the information of the taxpayer.
[13] The clear
implication of the notice is an advice from SARS that the tax record
of Stabilpave reflected no banking particulars
and that payment would
therefore be effected by means of a cheque through the post. No
choice was afforded to Stabilpave.The method
of payment was dictated
by SARS. The mere fact that a creditor knows or expects to be paid by
cheque through the post or that it
does not raise an objection does
not in itself give rise to an implied request or electionby the
creditor to be paid in such manner.
5
[14] Accordingly, the
risk of loss of the cheque was not assumed by Stabilpave and remained
with SARS. It thus did not discharge
its indebtedness by posting a
cheque for the amount of the refund that is due to Stabilpave.
[15]
In
the result the following order is made:
1. The appeal is upheld
with costs.
2. The order of the court
a quo dismissing the appellant’s appeal with costs is set aside
and there is substituted an order
which reads:
(a) The appeal is upheld
with costs.
(b) Judgment is granted
in favour of the plaintiff against the defendant for:
(i) Payment of the sum of
R724 494.29;
(ii) Interest
a
tempore morae
on the aforesaid sum at the rate of 15.5 percent
per annum from 17 October 2006 until date of payment;
(iii) Costs of suit.
__________________________
P A MEYER
ACTING JUDGE OF APPEAL
APPEARANCES:
For Appellant: JP de
Bruin SC
Instructed by:
Hill
McHardy & Herbst Inc Bloemfontein
For
Respondent: PJJ Marais SC and
H
Kooverjie
Instructed
by:
Rudman
Attorneys
Pretoria
1
See:
Barclays National Bank Ltd v Wall
1983 (1) SA 149
(A) at
156H-157C.
2
Per
Rumpff J in
Dadoo & Sons Ltd v Administrator, Transvaal
1954
(2) SA 442
(T) at 445.
3
‘
Taxpayers
beware the SARS cheque refund’
2010
(73) THRHR 482.
4
Mannesmann
Demag (Pty) Ltd v Romatex
1988 (4) SA 383
(D) at 389F-390D.
5
Wall
(supra) at 159G;
Dadoo
(supra) at 445H;
Goldfields
Confectionery and Bakery (Pty) Ltd v Norman Adam (Pty) Ltd
1950
(2) SA 763
(T) at 770.