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[2011] ZASCA 40
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Absa Bank Ltd and Another v Eksteen (81/10) [2011] ZASCA 40 (29 March 2011)
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case No: 81/10
No precedential significance
In the matter between:
ABSA BANK LIMITED
..............................................................
1
st
Appellant
NEDBANK LIMITED
................................................................
2
nd
Appellant
and
MARIUS EKSTEEN
......................................................................
Respondent
Neutral citation:
Absa
Bank v Eksteen
(81/10)
[2011] ZASCA 40
(29 March 2011)
Coram:
NAVSA, NUGENT,
HEHER, CACHALIA and MALAN JJA
Heard:
7 MARCH 2011
Delivered: 29 MARCH 2011
Summary:
Sale –
warranty against eviction – seizure of vehicle by police –
s 86(6) National Road Traffic Act prohibiting
buyer from being
in possession – seller liable for repayment.
_______________________________________________________________________
ORDER
_______________________________________________________________________
On appeal from: High Court
Bloemfontein (Nxusani AJ sitting as court of first instance)
Both appeals are dismissed. The
appellants are ordered to pay the costs of the respondent jointly and
severally. No further costs
order is made as between the appellants.
_______________________________________________________________________
JUDGMENT
_______________________________________________________________________
NUGENT JA (NAVSA, HEHER, CACHALIA
and MALAN JJA concurring)
[1] The
decision of this court in
Marvanic
Development (Pty) Ltd v Minister of Safety and Security
1
is decisive of
this appeal. In that case the police seized certain vehicles on
suspicion that they had been stolen after discovering
that their
identification numbers had been tampered with. The appellants,
alleging that they were the owners of the respective
vehicles,
claimed their return from the police. Their claim failed on the
ground that
s 68(6)
of the
National Road Traffic Act 93 of 1996
prohibited them from being in possession of the vehicles – even
if they were owners.
[2] This case arises from a
series of sales of a Toyota Land Cruiser motor vehicle. The evidence
does not disclose how the vehicle
came into her possession but Ms
Wilton sold it to Nedbank (the second appellant). Nedbank sold it to
Absa Bank (the first appellant)
who sold it to Mr Eksteen (the first
respondent). Mr Eksteen sold the vehicle to Mr Hugo.
[3] The police seized the vehicle
from Mr Hugo. Investigations revealed that the original chassis and
engine numbers had been tampered
with. In response to enquiries made
of Interpol the police were told that the vehicle had been stolen
from its owner in Japan.
[4] When he was told that the
vehicle had been seized Mr Eksteen repaid the purchase price to Mr
Hugo. He then instructed his attorney
to write to Absa Bank,
informing it that Mr Eksteen was of the view that he had had no
defence to a claim by Mr Hugo for return
of the purchase price. Absa
Bank was informed that Mr Eksteen intended in turn to claim repayment
of the purchase price that he
had paid to Absa Bank. He invited Absa
Bank to assist him to resist the seizure of the vehicle by the police
and said that unless
Absa Bank furnished either Mr Eksteen or Mr Hugo
with information that would enable one or other to recover possession
it would
be assumed that Absa Bank agreed with the view that was held
by Mr Eksteen. Absa Bank failed to reply.
[5] Mr Eksteen duly sued Absa
Bank in the Free State High Court for return of the purchase price
that he had paid for the vehicle,
relying upon the breach by Absa
Bank of the warranty against eviction that is inherent in a contract
of sale. In response to the
claim Absa Bank pleaded that Mr Eksteen
could and should have resisted the dispossession by instituting
proceedings against the
police for the return of the vehicle. In
response to that portion of the plea Mr Eksteen replicated as follows
(my translation):
‘
The
plaintiff admits that he did not institute legal proceedings for the
return of the vehicle by the SAPS but pleads that the plaintiff
is
prohibited by law to possess the vehicle and to claim its return in
that:
the engine and
chassis numbers of the vehicle have been unlawfully altered; and
possession of the
vehicle by the plaintiff is prohibited by the provisions of
Section
68(6)
of Act 93 of 1996; and
plaintiff has no
valid title to the vehicle.’
[6] Absa Bank joined Nedbank as a
third party to the proceedings, claiming an indemnification from
Nedbank in the following terms:
‘
In
the event of:
the above
Honourable Court finding that the vehicle had been stolen and was a
stolen vehicle at the stage that it was sold to
[Mr Eksteen]; and
that the South
African Police Services were entitled to confiscate the vehicle in
terms of Section 31 of the Act; and
the above
Honourable Court granting judgment in favour of [Mr Eksteen] for the
amount claimed as aforesaid
then and in that
event [Absa Bank] will be entitled to be indemnified by [Nedbank] in
terms of the provisions of Rule 13(1) of the
Uniform Rules of Court
…’
[7] Nedbank in turn joined Ms
Wilton as a Third Party, conditionally claiming an indemnification on
a similar basis. She did not
defend the claim and is not a party to
this appeal, although she was been cited as such.
[8] The court
below (Nxusani AJ) upheld the claim by Mr. Eksteen and ordered Absa
Bank to pay him the agreed value of the vehicle
at the time the
action was instituted
2
plus interest
and costs. Nedbank was in turn ordered to indemnify Absa Bank, and Ms
Wilton was ordered to indemnify Nedbank. Absa
Bank and Nedbank now
appeal the orders made against them respectively with the leave of
that court.
[9] No admissible evidence was
placed before the court below to establish that the vehicle had
indeed been stolen from its owner
in Japan. Nonetheless, evidence
that the original identification numbers had been tampered with was
not in dispute.
[10] Absa Bank attacked the order
made against it on two grounds. It contended that by raising the
statutory prohibition against
possession Mr Eksteen had introduced a
new cause of action and that he was not entitled to have done so in a
replication. A corresponding
point was raised by Nedbank in resisting
the claim by Absa Bank – it said that the claim against it in
the Third Party Notice
had been predicated upon the vehicle having
been stolen and that Absa Bank was not now entitled to place reliance
on the statutory
prohibition. That was the sole basis for its appeal.
It is disconcerting that major banks should have sought to avoid
liability
on trivial points of pleading at the outset and even more
disconcerting that they persist in those points on appeal. Pleadings
are the servant and not the master. The statutory prohibition was
fully canvassed at the trial. Even if the issue was not strictly
raised in keeping with ordinary principles of pleading that has
become immaterial.
[11] The only
other ground upon which Absa Bank sought to avoid the claim was in
reliance upon an observation made by Lewis JA in
Marvanic.
In
that case the learned judge said that the appellant was capable of
regularising its possession of the vehicles by applying for
and being
issued with new identification numbers. It was submitted on behalf of
Absa Bank that because Mr Eksteen was equally capable
of having done
so in this case the dispossession was not unassailable. The
submission is misconceived.
[12] It is
trite that a seller of property impliedly warrants to the buyer that
he or she will not be evicted from possession of
the purchased
property.
3
The most
common form of eviction occurs where a purchaser is deprived of the
property by the true owner but it is not so confined.
Eviction occurs
as much where the police or some other official seizes the property
under statutory authority.
4
An action lies
where the purchaser shows that the eviction is unassailable, and it
is unassailable if the purchaser is not able
to resist the eviction
at the time that it occurs. The fact that he or she might be capable
of later acquiring the right to possession
is immaterial. On the
authority of
Marvanic
the series of
purchasers were indeed not capable of resisting the eviction.
[13] There is
another ground, however, upon which Mr Eksteen might have succeeded.
In
Lammers
& Lammers v Giovannoni
5
Schreiner JA
pointed out that ‘the basic obligation of the seller is to
protect the buyer in his possession…. If he
fails to shield
the buyer against eviction he must restore the price and pay the
damages suffered by the buyer as a result of the
eviction’.
6
The
consequence of that obligation, he went on to say, was that:
‘
[once]
the seller is called upon to defend the buyer in his possession but
washes his hands of the whole matter, it does not seem
to me to be
open to him to to meet the buyer’s claim by saying that the
latter could or should have resisted the true owner’s
claim
more energetically or skillfully; for it was open to him, the seller,
to have taken steps to protect the buyer and himself.’
[14] In this case Absa Bank was
indeed called upon to resist the dispossession and indeed washed its
hands of the matter. On that
ground alone it had no defence to the
claim.
[15] Both appeals are dismissed.
The appellants are ordered to pay the costs of the respondent jointly
and severally. No further
costs order is made as between the
appellants.
_________________
R W NUGENT
JUDGE OF APPEAL
APPEARANCES:
For
1
st
appellant: G H Meyer
Instructed
by:
Jay
Mothobi Inc, Rosebank
Naude’s
Attorneys, Bloemfontein
For
2
nd
appellant: H J Smith
Instructed
by:
Cliffe
Dekker Hofmeyer Inc, Sandown
Webbers
Attorneys, Bloemfontein
For
respondent: D J van der Walt
Instructed
by:
Lovius
Block, Bloemfontein
1
2007
(3) 159 SA (SCA). Later followed in
Basie Motors Bk t/a Boulevard
Motors v Minister of Safety and Security
[2006] SCA 35 (RSA).
2
Whether
that was the correct amount to be awarded is not in issue in this
appeal.
3
‘
Sale’
by AJ Kerr and G Glover in
LAWSA
2ed Vol 24 para 75.
4
Vrystaat
Motors v Henry Blignaut (Edms) Bpk
[1995] ZASCA 146
;
1996 (2) SA 448
(A);
LAWSA,
above, para 79.
.
5
1955
(3) SA 385
(A) at 392F-G.
6
At
390A-B.