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[2017] ZAFSHC 20
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Immaculate Truck Repairs CC v Capital Acceptances Ltd (1153/2014) [2017] ZAFSHC 20 (16 February 2017)
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IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number: 1153/2014
In
the matter between:
IMMACULATE
TRUCK REPAIRS CC
Plaintiff
and
CAPITAL
ACCEPTANCES LTD
Defendant
HEARD
ON:
31 OCTOBER
2016
JUDGMENT
BY:
RAMPAI, J
DELIVERED
ON:
16 FEBRUARY 2017
[1]
The matter came to the court by way of action proceedings. The
plaintiff sues the defendant for compensatory payment of
an amount of
R136 287.48, interest thereon at the rate of 15,5% per annum
a
tempore morae
and costs of the action. The action is defended.
[2]
I deem it necessary to give some historical background of undisputed
facts and facts which, though disputed, could not be seriously
denied. The plaintiff is a closed corporation called Immaculate
Truck Repairs CC. Its principal place of business is
situated
at 36 Mill Street Hamilton in Bloemfontein.
[3]
The defendant is a company called Capital Acceptances Ltd. Its
principal place of business is situated at 100 Grayston
Drive,
Sandown, Sandton, Johannesburg in Gauteng.
[4]
At the centre of the dispute between the parties is a certain motor
vehicle with registration number [Z....], engine number
11807654 and
chassis number 1XP6D 69X 9VD 609 667. It is described as a
1998 Peterbilt Model 362E Celect Plus 460 Chassis
Cab Truck Trador.
Brevitas
causa
,
I shall refer to this vehicle, with a technically fancy name, simply
as a truck and not as a cab or a tractor. The truck
is owned by
the defendant – see “anx a”. It was
registered as such on 17 May 2010.
[5]
Somehow a third party called Touro Trucking (Pty) Ltd acquired actual
possession of the truck. It would appear to me that
the
corporate enterprise became a
de
facto
possessor of the truck prior to 9 March 2012; that the truck broke
down somewhere in the Eastern Cape Province and that the breakdown
was occasioned by certain mechanical engine defects.
[6]
Subsequent to the breakdown the third party and the plaintiff
concluded an oral agreement in Bloemfontein during or about early
March 2012. The plaintiff was instructed, by the third party,
to repair the truck by restoring it to proper functional conditions.
The third party’s principal contractual obligation was to pay
the plaintiff’s repair bill. The plaintiff looked
up to
the third party and not to the defendant for the payment of its costs
and expenses relative to the repairs.
[7]
Pursuant to the agreement, the plaintiff repaired the defendant’s
truck. On 9 March 2012 the plaintiff invoiced
Touro Trucking
(Pty) Ltd, for the repairs it had effect to the truck in accordance
with the oral agreement. The plaintiffs
repair bill totalled
R136 287.48 as would appear from “anx b”, a detailed
and specified account rendered.
According to the plaintiff the
repair bill was representative of the necessary expenses as well as
the useful expenses incurred
to restore the truck to proper working
conditions. Touro Trucking (Pty) Ltd failed to settle the
plaintiff’s account.
To the dismay of the plaintiff, the
third party was placed under final liquidation on 23 October 2012 by
the North Gauteng High
Court, Pretoria.
[8]
As a result of the third party’s winding up, the plaintiff
turned to the defendant for compensatory relief. Until
then the
defendant was unaware of the repairs the plaintiff had allegedly
effected to its truck. In confronting the defendant
with such a
compensation claim, the plaintiff alleged that the plaintiff had
acted as a
bona
fide
gestor
who had, in good faith, managed the affairs of the defendant in the
mistaken belief that the plaintiff was managing its own affairs
by
incurring the said expenses in connection with the repairs to the
truck.
[9]
The plaintiff’s alternative basis of its compensatory claim
against the defendant was that in incurring such expenses
for the
repair of the truck, the plaintiff had acted with the
bona
fide
intention of benefitting the owner of the trucker, being the
defendant. However, the plaintiff acknowledged that the
defendant
was under no contractual obligation whatsoever to
compensate the plaintiff for the costs and expenses incurred in
respect of the
repairs to the truck.
[10]
The defendant repudiated the plaintiff’s compensatory claim.
The defendant denied the foundation of such claim
and demanded
immediate return of the truck on the ground that the defendant was
the
de
iure dominus
of the truck and that it was not privy to the agreement to have it
repaired. The plaintiff refused to release the truck on
the
ground that the plaintiff was the lawful holder of the
ius
retentionis
– armed with the salvage lien. As a result of those
conflicting stances or irreconcilable positions the defendant
approached the court earlier on by way of motion proceedings and
successfully reclaimed the return of the truck by means of
rei
vindicatio
application.
[11]
On 13 March 2014 the plaintiff, aggrieved by the lawful
dispossession, caused a summons to be issued by the registrar against
the defendant to enforce its compensatory claim. The sheriffs
served the summons upon the defendant on 24 March 2014.
[12]
The defendant’s notice of intention to defend was served and
filed on 2 April 2014. On 8 May 2014 the defendant’s
plea
was served and filed.
[13]
In its plea the defendant denied the following allegations by the
plaintiff:
·
that
the plaintiff was a duly registered entity with the principal place
of business as stated in the summons;
·
that
this court has jurisdiction to entertain the matter on the alleged
grounds or at all;
·
that
the plaintiff and Touro Trucking (Pty) Ltd had ever concluded an
agreement for the repair of the truck;
·
that
Touro Trucking had, before its liquidation failed to settle the
plaintiff’s repair bill of R136 287-48;
·
that
the plaintiff had effected repairs to the truck with the intention of
claiming reimbursement for expenses necessarily and usefully
incurred;
·
that
the plaintiff had acted as
a
bona fide
gestor
who, in the mistaken belief that it was managing its own affairs, had
managed the affairs of the defendant;
·
that
the plaintiff, had alternatively repaired the truck with the
bona
fide
intention of benefiting the owner of the truck;
·
that
the defendant had benefited from the repairs at the expens of the
plaintiff who was thereby impoverished;
·
that
the defendant was, therefore, liable to compensate the plaintiff for
the expenses incurred to repair the truck by virtue of
the extended
actio
negotiorum
gestorum
and in the alternative;
·
that
the repairs so effected by the plaintiff to the defendant’s
truck had usefully increased the value thereof by R136 287.48.
[14]
The defendant admitted the following averments by the plaintiff:
·
that
the defendant was the lawful owner of the truck;
·
that
Touro Trucking was placed under final winding-up;
·
that
the defendant was unaware that the plaintiff had managed repairs to
its truck; and
·
that
the defendant was not contractually bound to compensate the plaintiff
for any expenses incurred to repair the truck.
Those
then were the undisputed material facts of the case.
[15]
The hearing started on 17 November 2015. The plaintiff, led the
evidence of its expert, Mr Rodney Edmund Stanton.
He testified
that the repairs to the truck were necessary in order to repair the
engine of the truck. It was then agreed
between the parties
that the plaintiff had spent R74 595.68 on motor spares to
repair the truck. The plaintiff’s
case was then closed.
The
hearing was resumed on 31 November 2016. The defendant then
applied for an order absolving it from the instance.
The basis
of the absolution application was that the plaintiff had not proved
that the alleged expenses were necessary or that
the defendant was
enriched. The application was unsuccessful. Thereupon the
defendant closed its case.
[16]
The plaintiff pleaded that it managed the affairs of the defendant in
the mistaken belief that it was managing its own affairs.
It
pleaded further that in so mistakenly managing the affairs of the
defendant, it acted as a
bona
fide gestor
.
Furthermore, the plaintiff’s sole witness, Mr Stanton,
testified that the plaintiff was never aware of the fact that
ownership of the truck vested in the defendant. That then was
the plaintiff’s main cause of action.
[17]
The plaintiff’s alternative compensatory claim, to main claim
based on the extended
action
negotiorum gestrum
,
was grounded on the remedial action of unjustified enrichment of a
dominus
by an improver. The plaintiff alleged that the repairs had
usefully increased the value of the truck by R136 287.48.
In a nutshell, that was the plaintiff’s alternative cause of
action. In my view, nothing significant turns on this
alternative since the extended
actio
negotiorum gestrum
as
already pleaded is, by its very nature, a remedial action founded on
unjustified enrichment.
[18]
The crucial question to be decided in the case is whether the
expenses incurred by the plaintiff in effecting the repairs to
the
defendant’s truck were necessary expenses. The residual
question, which only arises if the crucial question is
positively
decided, is the precise
quantum
of such necessary expenses.
[19]
On behalf of the plaintiff, Mr Olivier contended
that
the evidence adduced in support of the plaintiff’s pleaded case
was more than sufficient to prove that the compensatory
claim sought
falls squarely within the category of expenses classified as
necessary expense incurred by the plaintiff. Therefore,
counsel
contended that the plaintiffs did not have to show that the value of
the truck was thereby actually increased. Consequently
counsel
submitted that a proper case had been made out for the grant of
judgment with costs as prayed for by the plaintiff.
[20]
On behalf of the defendant, Mr Du Plessis sharply differed.
Counsel contended, on the contrary, that the plaintiff had
adduced no
evidence to show that the expenses incurred were indeed necessary
expenses for the preservation or protection of the
truck.
Moreover, in developing his argument further, counsel additionally
contended that the plaintiff had also adduced no
evidence to show
whether the defendant was enriched and, if so, the
quantum
of such unjustified enrichment. Accordingly counsel submitted
that, in view of such lack of evidence, no proper case had
been made
out for the relief sought by the plaintiff. Counsel urged me,
therefore, to dismiss the plaintiff claim with costs.
In the
alternative, counsel urged me to grant absolution from the instance
with costs.
[21]
Some cursory overview of applicable legal principles as expounded
through caselaw appears necessary in order to clarify the
issues.
The
legal concept –
negotiorum
gesto,
entails voluntary management by one person, called the
gestor
,
of the affairs of another, called
dominus
without the consent or knowledge of the latter. Simply put,
negotiorum
gestio
boils
down to unauthorized administration. See an article by Mr
Justice DH van Zyl and the authorities there cited.
[22]
The essentials or requisites of for a claim arising from
negotiorum
gestio
are the following:
“
(a)
The affairs managed by the
gestor
must have been those of another.
Turkstra
v Massyn
[1959]
1 All SA 263
(T),
1959
(1) SA 40
(T) p. 47
(b)
The
dominus
must
have been ignorant of the fact that her or his affairs were being
managed. Turkstra v Massyn
[1959]
1 All SA 263
(T),
1959
(1) SA 40
(T) p. 47
North
West Arts Council v Sekhabi
[1996] 3 All SA 361
(B)
A
dominus
who is aware of the management of her or his affairs and does nothing
about it is regarded as having authorised it tacitly.
(c) The intention to
manage the affairs of another is perhaps the most significant
requisite for a claim based on
negotiorum gestio
. This
intention includes the intention to claim reimbursement for expenses
necessarily or usefully incurred by the
gestor
.
Odendaal
v Van Oudtshoorn
[1968]
3 All SA 482
(T),
1968
(3) SA 433
(T) p. 437
Maritime
Motors (Pty) Ltd v Von Steiger
2001
(2) SA 584
(SE)
(d)
The management of the
dominus’s
affairs should have been
conducted in a reasonable way (utiliter coeptum), at least at the
commencement of the
gestio
. The result of this rule is
that a claim will arise even if the
gestio
is ultimately
unsuccessful. A
gestor
who employed an unreasonable
method does not have a claim for disbursements.”
per
DH van Zyl J – LAWSA Second Ed Vol 17 p 20-37.
[23]
The plaintiff claims compensation from the defendant for the costs
and expenses incurred in connection with certain repairs
to the
truck. At all times material to the dispute, the defendant was
the outright owner of the truck so repaired.
The repairs as
effected constituted no pure unauthorized management of one’s
affairs by another. Instead the plaintiff’s
cause of
action is based on the extended
actio
negotiorum gestrum
as stated in par 11.2 summons. Such remedial action is
available to a party in a case where the basic requisite of the
actio
negotiorum gestrum termed animus negotia aliena gerendi
(one’s intention to manage the affairs of another) is shown to
be on the part of the improver or manager. LTC Harms:
Amaler’s Precedents of Pleadings 7
th
edition p. 298.
[24]
There are four instances in which the
gestor’s
claim against the
dominus
is considered to be limited to the extent of the unjustified
enrichment of the
dominus
.
Only one of the four instances is relevant to the matter at hand.
The
gestor’s
claim is limited, among others, in the case where the
gestor
manages the affairs of another in the mistaken but
bona
fide
belief that they are his or her own
Standard
Bank Financial Services Ltd v Taylan (Pty) Ltd
1979 (4) ALL SA 1(c)
,
1979 (2) SA 383
(c).
[25]
The
dominus
is required to reimburse the
gestor
for the necessary expenses and the useful expenses only. The
dominus
is not generally required to reimburse the
gestor
for luxurious expense save in certain exceptional circumstances which
are not relevant to the current matter. The
gestor’s
right to be reimbursed is subject to the general limitation that the
dominus
,
as the defendant, is liable for no more than his or her actual
enrichment. The extent of the
dominus
actual enrichment is not necessarily the same as the
gestor’s
actual expenses incurred. Since the
gestor’s
action is fundamentally derived from an enrichment action,
non-enrichment of the
dominus
is, of course a good defence to the
gestor’s
action – LAWSA: Volume 9 Second Edition par 224.
The
gestor
has no claim for his or her own labour –
Harrisen
v Marchant
1941 WLD 16
at 20 - 21.
[26]
It is trite that the right of a
bona
fide
possessor to claim compensation for necessary and useful expenses
incurred in effecting necessary and useful improvements to the
property of another was recognised in Roman-Dutch Law. It has
since been received in modern South African Law through caselaw.
A
bona
fide
possessor’s right to claim compensation for luxurious expenses
incurred in effecting luxurious improvements to the properly
of
another stands on a different footing. Such a claim is
restricted to cases where the property owner intends to retain
the
luxurious improvements or to cases where the property owner intends
to sell the property whose marked value has been enhanced
on account
of the luxurious improvements. LAWSA: Volume 9 Second
Edition para 123. In this instance only the
necessary expenses
are of primary concern to the parties. All the same I shall
also refer to useful expenses seeing that
the summons shows that the
plaintiff also claimed compensation on this basis.
[27]
As regards necessary expenses, the measure of compensation for such
expenses is full reimbursement by the enriched owner in
favour of the
impoverished
bona
fide
possessor. The ratio is that the owner has been enriched in
that, if it were not for the voluntary act of the
bona
fide
possessor,
the owner himself or herself would, in any event, have had to incur
such necessary expenses.
Voet
6. 1. 36; Lechoana v Cloete
1925 AD 536.
Impensae
necessariae
,
that is to say necessary expenses are regarded as expenses, incurred
by a
bona
fide
possessor
because
they were necessary for the preservation or protection of the
property.
Nortje
v Pool
1966 (3) SA 96
(A) at 131.
[28]
Money expended in connection with the preservation of property
constitutes necessary expenses. A
bona
fide
possessor, as a voluntary actor, who dispenses of money, material or
similar necessary preservatives, is entitled to be reimbursed
in
full. The possessor’s right for full reimbursement is
qualified and subject to the limitation that the owner’s
obligation to reimburse the possessor cannot exceed the extent of his
or her actual enrichment. This is the rule of equity.
Rhoode
v De Kok & Another
2013 (3) SA 123
(SCA) par [14].
[29]
The defining characteristic of necessary expenses is its preservative
nature. They are incurred by a
bona fide
possessor with
the sole intention of protecting another’s property from
perishing or from the corrosive and adverse effects
of depreciation.
It is precisely this distinctive and individualistic character which
distinguishes the particular type of
expenses from the other two
categories of expenses. Here the intention of a
bona fide
possessor is neither to usefully enhance the market value of the
property nor to luxuriously or lavishly improve its prestigious
image
with decorative finesse.
[30]
As regards useful expenses, the measure of compensation due to the
bona
fide
possessor
is limited to the amount by which the value of the owner’s
property was increased by the expenses incurred or the
amount of the
actual expenses incurred by the possessor. However, the measure
of compensation the possessor can claim from
the owner is limited to
the less of the two amounts.
Fletcher
& Fletcher v Bulaway Waterworks Co Ltd
1915 AD 636
at 648. This is a rule of equity. The court
has a wide discretion –
Rhoode
,
supra
[15] and the authorities there cited.
Impensae
utiles
are expenses incurred by a possessor with the intention of enhancing
the value of the property by effecting useful improvement
thereon.
[31]
The law is clear. A
bona
fide
possessor has a right of retention over the property preserved or
improved. The
ius
retentionis
protects a possessor’s possession of the property until an
owner compensates a possessor for the expenses incurred in connection
with useful improvements or necessary improvements effected to the
property. A possessor’s right to be reimbursed for
necessary and useful expenses, as protected by the salvage or
improvement lien, is qualified.
[32]
In
United
Apostolic Faith Church v Boksburg Christian Academy
2011 (6) SA 156
(GSJ) par [31] Willis J, as he then was, said the
following about what the qualification entails and, more importantly,
the onus.
“
The
right is, however, qualified to the extent that the improvements
must, on the facts,
be
useful or necessary and properly quantified
.
The
onus is on the retentor to establish these facts
.
A right of retention will only, however, exist where the retentor in
fact has a claim founded in enrichment against the
owner. Without any
unjustified enrichment, neither a claim nor a right of retention can
prevail.”
It
is evident, therefore, that the claimant has to prove the connective
tissue between impoverishment and enrichment.
[33]
The plaintiff claims compensation in respect of the necessary
expenses as well as the useful expenses. To sum the law,
the
following legal position emerged from all the authorities cited
above:
33.1
Where the expenses were
necessary
for the preservation or protection of the property (
impensae
necessariae
),
the possessor is entitled to reimbursement of all his or her
expenses, subject to the limitation that the defendant is liable
for
no more that his or her actual enrichment;
33.2
Where the possessor has effected
useful
improvements to the property
(impensae
utiles)
he or she is entitled either to his or her actual expenses or the
amount by which the value of the property has been enhanced,
whichever is the lesser;
33.3
The
onus
is on the plaintiff to prove both amounts;
33.4
The
gestor
is not entitled to remuneration for his or her labour.
[34]
Now I turn back to the instant matter. I proceed to examine the
facts and to consider them in the light of the applicable
legal
principles as outlined above. Before these action proceedings were
initiated, the defendant as the applicant launched motion
proceedings
to reclaim possession of the truck. It asserted its real right
of ownership in respect of the truck –
ius
rei vindication
.
The plaintiff as the respondent, opposed such vindicatory application
for the redelivery of the truck in its possession.
To protect
its possession of the truck, the plaintiff relied on an improvement
lien –
ius
retentionis
.
To overcome that hurdle, the defendant provided security in order to
provisionally regain physical possession of the truck.
[35]
The mere fact that the defendant has provided security, in the place
of the plaintiff’s improvement lien in order to
obtain
possession of the truck, does not detract from the fact that the
plaintiff even now still relies on such a lien to protect
its
possession. Let me put it differently. By accepting the
conditional security which the defendant provided, the
plaintiff did
not, in law, renounce its right of retention to protect its
possession of the truck. It follows, therefore,
that the
plaintiff’s lien is as live here and now in these current
action proceedings as it was there and there in those
recent motion
proceedings.
[36]
The enquiry is twofold. Its first essential is that the person
claiming protection of his or her possession by way of
a salvage lien
(on the grounds that (s)he has incurred necessary expenses in order
to preserve the property from depreciating or
perishing) – must
show that he was put to expense.
King’s
Hall Motor Co v Wickens & McNichol
1931 NPD 37
at 44 per Hawthorn AJ, as he then was. In the
instant matter, the plaintiff is the person whose duty it is to
discharge that
first huddle of the onus.
[37]
It was the plaintiffs case, as pleaded, that it incurred necessary
expenses as well as useful expenses in connection with the
truck.
I shall revert to the latter category of expenses later. For
now I first want to deal with the necessary expenses.
The
hallmark of the necessary expenses lies in the possessor’s good
faith to prevent depreciation of the property.
The plaintiff’s
witness, Mr Stanton testified that the truck had broken down
somewhere near Queenstown in the Eastern Cape
Province; that
the plaintiff towed it from the scene of the breakdown to its
industrial workplace in Bloemfontein;
that the plaintiff
incurred certain expenses to buy spares; that the plaintiff
spent time, labour and other resources working
on the truck in order
to restore it to its good state of repairs.
[38]
As earlier pointed out, necessary expenses have to be exclusively
incurred for a recognised purpose - that is to preserve
a
property by preventing or minimizing its depreciation. There
was no evidence at all that the truck would have materially
depreciated if the plaintiff had only towed and garaged it. The
rest of the resources and money expended on the truck did
not
constitute necessary expense. I have no idea as to how much
expenses were incurred relative to the towing and the garaging
of the
truck were.
Naidoo
v Sanbonani Express Freight & Another
2008 (5) SA D per Levinsohn DJP. But even if such expenses were
specified, they would still not have qualified as necessary
expenses
within the context of the equitable legal principles. This is
so because during his indirect evidence, the plaintiff’s
witness conceded that the truck was towed and stored for the purpose
of repairing and not for the purpose of preserving it voetstoot.
This was the first and material crack between the plaintiff case as
pleaded and its case as improvised. Moreover, there was
no
evidence as to unfavourable circumstances prevailing on the scene of
the breakdown at Queenstown. As a result of such
a glaring
omission, I have no idea as to what really made the plaintiff to
believe the truck was in danger of depreciating unless
it was towed
to Bloemfontein, a considerable distance from Queenstown. If
the preservation of the truck was a material consideration,
the truck
could easily have been preserved at Queenstown, a town only 10 km
away from the scene.
[39]
At the initial level of showing that the plaintiff, as the possessor
of the truck, was put to expense in the form of necessary
expenses,
the plaintiff really had an insurmountable mountain to climb.
Where there was no proven impoverishment in the form
of necessary
expenses, there could have been no question of corresponding
enrichment. It follows logically –
United
Apostolic
,
supra. I would, therefore, dismiss the claim as regards
necessary expenses. This concludes the enquiry as regards
the
first leg of the first essential. That, however, is not the end
of the enquiry in relation to the first essential.
[40]
The first essential of the enquiry as already indicated, dictates
that an improver who relies on an improvement lien to claim
protection of his (or her) possession must show that (s)he was put to
expense
King’s Hall
,
supra
.
Now
I proceed to examine the facts and to apply the first essential of
the enquiry in relation to the useful expenses.
[41]
It was the plaintiffs further case that it had also incurred useful
expenses in connection with the truck. Now it is
to this second
component of the plaintiff’s claim that I turn. The
hallmark of
impensae
utiles
revolves around the possessor’s good intention to enhance the
value of the property. As a
bona
fide
possessor, the plaintiff would ordinarily have a right of retention
in respect of the truck until compensated by the defendant
for the
useful improvements the plaintiff has made to the property.
Until the defendant compensates the plaintiff, the improvement
lien
remains in place to protect its
de
iure
possession notwithstanding the fact that the defendant is the current
de
facto
possessor of the truck.
[42]
The plaintiff’s sole witness gave evidence that the plaintiff
took possession of the truck in order to have it repaired.
The
defendant disputed the evidence that the plaintiffs repair bill, “anx
b”, was representative of the fair and reasonable
amount of the
useful expenses incurred by the plaintiff. However, the
defendant agreed that the sum of R74 595.68 was
a reasonably
accurate reflection of the useful expenses incurred by the plaintiff
to improve the truck.
[43]
Apart from the concession made by the defendant, the quantum of the
plaintiffs invoice remained disputed. Save for the
sum of the
actual useful expenses admitted by the defendant, the plaintiff has
failed to prove any further useful expenses.
No evidence
whatsoever was led on the balance of the claim which the defendant
vigorously disputed. The plaintiff’s
right of retention
is not absolute but relative. In
United Apostolic
,
supra
at [31] Willis J, as he then was, expressed the following apposite
view about the retentor’s right:
“
The
right is, however, qualified to the extent that the improvements
must, on the facts,
be
useful
or necessary
and
properly quantified
.”
[44]
According to Mr Stanton’s indirect testimony, the truck was
valued at R95 000 by John Williams Motors. He
confirmed
that the amount represented the truck valuation after the repairs
were done. He explained that the amount was a
trade-in value
and not resale value. He estimated the resale market value of
the repaired truck to be approximately R210 000
–
R230 000. The difficulty I had with all these figures was,
firstly that they constituted new evidence and secondly,
that they
were not supported by any documentary evidence.
[45]
I am persuaded by Mr Du Plessis’ submission that, as regards
useful expenses, the plaintiff failed to adduce any reliable
evidence
relating to towing charges, labour charges, garaging charges,
expected profit and the reasonableness of any portion of
its alleged
useful expenses. It has been held that a possessor relying on a
retention lien to recover or claim useful expenses
must prove the
actual amount expended –
Abelman
v Webber
[1928] TPD 398
.
That the plaintiff failed to do.
[46]
In
the circums, it cannot be convincingly argued that the plaintiff was
put to expense in the form of useful expenses equal to the
amount as
claimed in the summons. It follows, therefore, that
the second leg of the first essential of the equitable
enquiry was
also not established by the plaintiff. Later I shall revert to
the portion of the plaintiff’s useful expenses
which the
defendant conceded. This disposes of the first essential of the
enquiry.
[47]
The second essential which the plaintiff as the possessor, had to
prove was that the defendant, as the owner, was enriched
in the sense
that the value of the truck was enhanced by the useful improvements.
The improvement lien rests upon the equitable
principle that no one
shall be enriched at the expense of another –
King’s
Hall
,
supra
.
[48]
In a case like this, the ultimate enquiry concerns enrichment.
Therefore, it is incumbent upon an improver who alleges
unjust
enrichment of the owner to establish it by means of credible and
reliable evidence –
Naidoo
,
supra
[15]. It was not done in this instance. There is not a
tittle of evidence to establish unjust enrichment. In
my view
the defendant has not quantified the actual sum of its useful
expenses, the value of the truck before the useful improvements
were
made, the enhanced value of the truck after the useful improvements
were made and the extent of the defendant’s enrichment.
All these figures were of vital importance to put me in an informed
position in order to determine whether the defendant was unjustly
enriched as alleged.
[49]
It was clear and obvious to me that the plaintiff misconceived the
legal nature of useful expenses. The correct measure
of
compensation is neither the reimbursement of the actual useful
expenses incurred or the actual extent of enrichment gained but
rather the smaller figure of the two. The plaintiff equates the
sum of its alleged actual expenses, R136 287.48 as the
equivalent of the defendant’s unjust enrichment. Such a
method was materially flawed. That was not the correct
way to
do it. It is conceivable that, in principle, the two figures
may theoretically be the same. However, that was
not the case
here. In this matter, however, there was not a tittle of any
figures to prove such a mathematical equation.
“
[17]
A similar situation presents itself in the instant case. The first
respondent has in my view
not
led any evidence whatsoever to demonstrate the quantum of the unjust
enrichment
.
There is no indication of the place where the goods were stored and
the costs of storage, the costs of insurance and moreover
why it
would have been in the interests of the owner of the goods to store
them in the first place. In my view the first respondent
has signally
failed to prove the existence of a salvage lien.”
Naidoo
,
supra
,
per Levinsohn DJP.
[50]
Consequently, I am not persuaded that the plaintiff, as the possessor
and improver relying on an improvement lien to claim
reimbursement
for useful expenses has discharged the onus. It was incumbent
upon the plaintiff to show:
·
firstly,
that the plaintiff as an improver, was put to expense, in other words
impoverished, in the sense that but for the useful
expenses the value
of its estate would not have decreased as it did, and
·
secondly,
that the defendant, as the owner, was enriched thereby, in the sense
that but for the useful expenses the value of the
truck would not
have increased as it did.
These
cardinal requisites were not satisfied.
[51]
Now a question may arise as to whether the plaintiff is not entitled
to be awarded the proven sum of its useful expenses as
admitted by
the defendant. At worst for the defendant, the plaintiff may
get R74 545.68 at most but can never be entitled
to
reimbursement exceeding the sum admitted by the defendant.
However, the plaintiff is not even entitled to claim that money
as a
portion of its legitimate reimbursement. Firstly, there was no
evidence that the admitted amount represented the actual
useful
expenses the plaintiff had incurred. Secondly, there was no
evidence of the actual amount of the defendant’s
enrichment,
which enrichment amount, the amount of the reimbursement is not
supposed to exceed. Thirdly, I am in the dark
as to whether the
admitted amount is greater or smaller than the unknown amount of the
defendant’s alleged enrichment.
[52]
In my view the plaintiff,
qua
a bona
fide
possessor, also had a real difficulty in this contest at the ultimate
level of this enquiry of equity to establish that the owner
was
unjustly enriched and the possessor’s unjustly impoverished.
Since it was not shown that the one was enriched at
the expense of
another, there exists no valid improvement lien on the strength of
which the improver’s continued retention
of the truck can be
sanctioned. Put differently: It was not shown that the
plaintiff is a
bona
fide
possessor
who has been inequitably impoverished as a result of its unauthorised
but equitably useful management of the defendant’s
affairs.
Because the plaintiff has failed to demonstrate unjust enrichment, it
follows, as a matter of logic, therefore,
that a cardinal requisite
of an improvement lien was amiss. I would, therefore dismiss
the claim.
[53]
A similar factual situation arose in
McCarthy
Rental Ltd v Shortdistance Carriers CC
2001
(3) SA 482
(SCA). In that case, as in this case, the court was
concerned with a typical instance of improvements made to an owner’s
motor vehicle without a contract between the repairer and the owner.
In those circumstances the repairer was, in law not
regarded as a
typical
gestor
of ancient times. Although a contractless improver or repairer
was not originally recognised as a typical
gestor
,
he was accorded, in common law, the same defensive remedy as the
ancient
gestor
.
[54]
Such repairer was designated as a
bona
fide
possessor
who, in pretty much the same way as the
gestor
,
could exercise a retention lien in order to claim compensatory
reimbursement for the actual useful expenses incurred or for the
increase in the market value brought about by useful improvement –
whichever amount of the two was the lesser.
[55]
Because law is dynamic, the legal position of a
bona fide
possessor changed for the better. The shortcoming of a
bona
fide
possessor’s defensive remedy was that the retention
lien could not afford a retentor any protection once physical
possession
was lost. The law developed and an improver or
repairer who no longer has possession of the usefully improved
property was
granted an offensive remedy as well.
In
McCarthy
,
supra
par [12] Schultz JA had this to say about the remedial extension of
the
negotiorum
gestrum
principle:
“
The
Roman-Dutch law developed on the Roman law in the respect that the
improver was not confined to the defensive remedy of exercising
his
lien, but was granted an action (
De
Vos
at
98). Thus the fact that in the case before us the garage has given up
possession voluntarily does not leave it remediless.
It may sue, as
it has done.”
[56]
The plaintiff heavily relied on the decision in
McCarthy,
supra
[17] where the court per Schultz JA said:
“
On
the face of it he was enriched by the receipt of the repaired truck
without there being a countervailing performance on his part,
juridically connected with that enrichment.”
[57]
It is significant to read the above passage with what the judge said
further down in the same paragraph. He continued:
“
The
upshot is that the owner was enriched
sine
causa.
The
amount of the enrichment was agreed at R186 000
.
By clear implication this meant that the market value of the damaged
truck was agreed to have been raised by that amount by necessary
and
useful expenditure.”
The
agreement between those parties implicitly entailed that they were at
idem
that the improver was put to expense, in other words impoverished to
the tune of R186 000 useful expenses. That was
the first
implication. The agreement also implicitly entailed that the
owner had gained an unfair advantage at the expense
of the improver,
in other words enriched to the tune of the same amount of R186 000
useful improvements.
[58]
In this matter the upshot of it all is that neither the amount of the
alleged useful expenses nor that of the alleged enrichment
was agreed
upon. The plaintiff failed to quantify, not only the amount of
the alleged enrichment but also of the alleged
useful expenses.
Quite obviously, the case relied upon was distinguishable from the
present case where the allegation of
enrichment was in dispute as was
the allegation of the actual useful expenses.
[59]
The plaintiff’s submission that a lien, salvage or improvement,
was inoperative in this matter was untenable. In
these
circumstance, a lien was very much alive and operative. It was
still available to the plaintiff as a
bona
fide
improver. But a lien would not establish a cause of action.
That is so because a lien is a dilatory defence –
a recognised
defensive remedy against an owner’s (dis)possessive remedy of
rei
vindication
.
However, by itself, a lien does not ground an action. It
logically follows, therefore, that a possessor would not
have a lien
unless (s)he has a cause of action and would not have a cause of
action unless (s)he has a lien –
Sandton
Square Finance (Pty) Ltd & Others v Vigliotli & Another
1997
(1) SA 826
(W);
McCarthy
,
supra
,
par [12].
[60]
Now the costs. The defendant emerged as the successful party.
Therefore, the costs must follow success. On
17 November 2015
the matter was postponed
sine
die
.
The postponement was at the special request and instance of counsel
for the plaintiff. He needed some time to prepare
written heads
of argument. Given those circumstances, it is only fair, just
and equitable that such reserved costs be for
the plaintiff’s
account.
[61]
Accordingly I make the following order:
61.1
The action is dismissed with costs.
61.2
The costs shall include those previously reserved.
____________
M.H.
RAMPAI, J
On
behalf of the plaintiff: Adv. J.L. Olivier
Instructed
by:
Safety
& Associates
Bloemfontein
On
behalf of the defendant: Adv. D.T. v R Du Plessis SC
Instructed
by:
JL
Jordaan Attorneys
Bloemfontein