About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Kwazulu-Natal High Court, Durban
SAFLII
>>
Databases
>>
South Africa: Kwazulu-Natal High Court, Durban
>>
2016
>>
[2016] ZAKZDHC 7
|
|
Parker v Standard Bank (AR218/15) [2016] ZAKZDHC 7 (10 February 2016)
IN THE HIGH COURT OF SOUTH AFRICA
KWAZULU-NATAL DIVISION,
PIETERMARITZBURG
CASE NO: AR218/15
DATE: 10 FEBRUARY 2016
In the matter between:
J
PARKER
..........................................................................................................................
APPELLANT
Vs
STANDARD
BANK
........................................................................................................
RESPONDENT
JUDGMENT
Date of hearing: 03 February2016
D. Pillay J (Koen J et Booyens AJ concurring)
[1]
This appeal against the judgment of Steyn J
is before us by leave of the Supreme Court of Appeal. The appellant
is a customer of
the respondent’s private bank division. She
authorised her erstwhile ‘cultural husband’ Mr Valodia to
operate
her account with the respondent. At some point she realised
that he was unscrupulous. She wanted to restrict his authority to
transact
on her account.
[2]
In
a telephonic conversation held on 5 February 2008 with Ms Gugu Nene
an employee of the respondent the appellant issued an instruction
the
gist of which was recorded by Ms Nene in the following terms :
‘
Jasmeen
[the appellant] phoned to say that everything that Mohammed [Mr
Valodia] asks us to do we must always confirm with her.’
[3]
Ms
Nene uploaded this instruction as a history note onto the
respondent’s computerised records. Notwithstanding the
instruction
the respondent paid out on cheques from the account to
the total value of R531 380.00. The appellant claims
reimbursement
of those payments with mora interest. Her cause of
action is based on the breach of the telephonic instruction always to
confirm
with her everything that Mr Valodia asked the respondent to
do.
[4]
In
the trial court the appellant relied on four telephonic discussions
with the respondent’s employees. In this appeal Mr
Tobias for
the appellant helpfully narrowed down the evidence to the
interpretation of the single instruction cited above. The
concession
by counsel for the respondent Mr V Naidoo SC that the instruction
amounted to a limitation or restriction of Mr Valodia’s
powers
narrows the issues further. His concession however did not go so far
as to accept that the limitation was on the powers
of Mr Valodia to
operate the account. Nevertheless he was unable to state what the
practical effect of the limitation was if not
a limitation on Mr
Valodia’s power to transact on the appellants’ account.
[5]
Instead Mr Naidoo sought to persuade the
court that it should consider:
i.
the context in which the appellant issued
the instruction;
ii.
whether there was a meeting of minds
between the appellant and the respondent’s employees sufficient
to form a contract that
imposed obligations on the respondent;
iii.
Mr Valodia’s authority to operate the
account was given in writing by the appellant, which rendered the
respondent vulnerable
to possible claims by Mr Valodia unless the
appellant gave the respondent a written instruction to terminate his
mandate.
[6]
Mr
Naidoo conceded that the respondent would act on telephonic
instructions to limit transactions on the account but persisted that
such instructions would not apply to cheques that Mr Valodia issued
against the account for as long as his authority to operate
the
account remained in force.
[7]
I
agree with Mr Naidoo that context matters. But the starting point of
any interpretation must be the text itself. The words ‘everything’
and ‘always’ leave no doubt that the limitation was in
the broadest terms. The instruction was to ‘confirm’
with
the appellant. By no stretch of any linguistic gymnastics can
‘confirm’ be synonymous with ‘monitor’
as
suggested by the respondent. The plain meaning of the text did not go
so far as terminate Mr Valodia’s authority to operate
the
account. When the appellant issued the instruction she did not want
to terminate his authority. She was content to allow certain
expenses
like the levy for their building to be paid from the account if first
confirmed by her.
[8]
The
undisputed context in which the appellant issued the instructions was
that the account was overdrawn to the tune of R200 000.00;
Mr
Valodia was applying for an extension of the overdraft; the appellant
saw no reason for the extension because she was expecting
to receive
funds into the account; Mr Valodia was unscrupulous; the appellant
did not want Mr Valodia to transact her account without
her prior
confirmation.
[9]
Mr Naidoo cited the appellant’s
evidence to establish the full terms of the instruction in his heads
of argument as follows
;
i.
‘
From
now on I want to confirm everything Mr. Valodia wants with regard to
that account.’
ii.
‘
He
will tell you that he has power of attorney but you need to tell him
that we are not taking any instructions from you anymore.
Anything
and everything you need from the account you need to get your wife to
call in and confirm with us.’
iii.
‘
When
he calls in and needs information you will phone and confirm with me
first. I will give you the go ahead whether you need to
supply that
information or not.’
[10]
This uncontested evidence of the applicant
clarifies and fortifies the wide ambit of her instruction. On any
basis Ms Nene could
not have been in any doubt that the respondent’s
employees had to call the appellant for everything that Mr Valodia
wanted
in respect of the account. As Ms Nene formulated the
history note it was her understanding of the instruction. The clarity
of her text would also have left other employees of the respondent in
no doubt as to what the instruction meant.
[11]
Mr
Naidoo conceded that none of the respondent’s employees called
the appellant until 27 February 2008 when Ms Nene advised
her that
over R500 000.00 had been withdrawn from her account. None of
them informed her of the receipt of R689 162.69
into her account
on 20 February 2008 as she had requested. None alerted her to Mr
Valodia syphoning out the total of R531 380.00
by issuing six
cheques on the account between 21 and 25 February 2008. None
informed her when she communicated the restriction
on Mr Valodia’s
powers to the respondent that the respondent would not act on her
telephonic instruction unless she confirmed
it in writing.
[12]
Mr
Valodia’s authority under the written mandate to the respondent
when she opened the account on 3 October 2006 enabled him
to
‘
deposit
and withdraw funds, apply for a cheque books, obtain bank statements,
stop payment of cheques and close or transfer the
account(s) subject
however to the following restrictions:’
.
The mandate form had no restrictions.
[13]
It
was common cause that the respondent would act on oral instructions.
It was also common cause that the respondent stopped payment
of the
cheque drawn by Mr Valodia for R156 000 on 27 February 2008 on
the oral instruction of the appellant. After the fact
insistence that
the oral instruction had to be confirmed in writing in order to
terminate Mr Valodia’s authority was technically
also complied
with when Ms Nene reduced the instruction to writing by uploading it
onto the respondent’s computerised
systems.
[14]
I
find that the appellant’s instruction unequivocally created an
obligation on the respondent to always confirm every act
that Mr
Valodia sought to perform under her mandate to the respondent. This
included issuing the cheques for which she seeks reimbursement.
The respondent breached this obligation. In doing so it also
failed in its written undertaking to the appellant when she
opened
the account that it would ‘always strive to serve and protect
her best interests’ and assist her with her financial
requirements ‘in a professional manner.’
[15]
The appellant’s case was always based
on the breach of the instruction which on acceptance amounted to a
binding contract.
Any doubt about her cause of action was elimated
after the respondent, having ventilated its objection to the
particulars of claim
before Gorven J, withdrew its objection. The
appellant reiterated during the trial that its claim was not in
delict for damages
but for reimbursement or a reversal of the
unauthorised debits. The trial court erred in finding that the
appellant had not established
any breach of contract.
[16]
As
the appellant’s claim is in contract and for the reversal of
the unauthorised debits she seeks to be restored to her status
ante
quo. Therefore her claim for mora interest is inappropriate. She is
entitled to the interest raised on each unauthorised debit
from the
dates they were made at the various rates payable from time to time
to the date of payment.
[17]
As
for the costs reserved before Gorven J, Mr Naidoo correctly conceded
that they should be awarded to the appellant in view of
the
respondent withdrawing its objection. Costs of the appeal must
follow the result.
[18]
The appeal succeeds with costs. The order
of the trial court is set aside and replaced with the following
order:
‘
The
respondent shall pay the appellant the following:
a.
R289
820.00
b.
R42
000.00
c.
R100
000.00
d.
R450.00
e.
R46
841.00
f.
R52
269.00
g.
interest
on each unauthorised debit in a-f above from the dates they were made
at the various rates payable from time to time to
the date of final
payment.
h.
The
costs reserved by Gorven J.
i.
Costs
of suit.’
D. Pillay J
Koen J
Booyens AJ
APPEARANCES
Counsel for the Appellant
: D.G Tobias
Instructed by : Shabeer
Joosab Attorneys
Tel: (031) 207 8337
Ref: Mr Joosab
Counsel for the Respondent
: V.M Naidoo SC
Instructed by : Chetty
Asmall & Maharaj
Tel: (033) 345 2359
Ref: Ms B Hiralal