About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2016
>>
[2016] ZAGPPHC 284
|
|
Denel Soc Lilited t/a Denel Aviation and Another v Mafalo and Another (39859/2015) [2016] ZAGPPHC 284 (9 March 2016)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE
NO: 39859/2015
DATE:
9 MARCH 2016
In the matter
between:
DENEL SOC LIMITED
t/a DENEL
AVIATION
................................................
FIRST
APPLICANT
DENEL
AEROSTRUCTURES
SOC
...............................................................
SECOND
APPLICANT
(PROPRIETARY)
LIMITED
And
KLAAS MADIMETSA
MAFALO
...................................................................
FIRST
RESPONDENT
DENEL RETIREMENT
FUND
...................................................................
SECOND
RESPONDENT
JUDGMENT
MAJIKIJ
[1] The applicants
are both companies duly registered in accordance with the South
African company laws. The first applicant wholly
owned the second
applicant as its subsidiary. The first applicant rendered human
resources services for the second applicant, such
services included
the administration of the second applicant’s payroll. The
second applicant is the former employer of the
first respondent. The
second respondent worked as an operator for the second applicant from
15 August 2011 until his dismissal
on 11 March 2015. The second
applicant brought an application seeking an order against the first
respondent for the repayment of
a sum of R716 533.30, together with
interest thereon, which was erroneously paid to the first respondent
with his November 2014
salary. The further order is sought against
the second respondent. The second respondent is a contribution
pension fund to which
the first respondent made contributions. The
order sought is that the second respondent be authorised to make
payment of the first
respondent’s accumulated benefits as part
payment towards settlement of the debt owed by the first respondent.
The reference
to Section 21 3(b) of the Government Employees Pension
Fund Law of 1996 in the notice of motion was corrected to section 37
D b(ii)
bb of Pension funds Act 24 of1956.
[2] The application
is opposed by the first respondent on the basis that the applicant
failed to make out a case for the order of
payment of the sum of R717
533.30 by the first respondent. Furthermore, without admission of
liability by the first respondent
or judgment in favour of the
applicants, the applicants have not provided authority upon which the
second respondent can be ordered
to make payment to the first
applicant.
[3] The following
facts are common cause; the first applicant paid the second
applicant’s money in error to the second respondent
with his
November salary. An incorrect code was entered by one Ms Kasselman on
the first applicant’s payroll system (the
“system”).
As a result thereof the first respondent was not paid the amount of
R25 439.25 which he ought to have been
paid but the sum of R1 910
129.61 the first respondent was therefore overpaid with a sum of R1
892 690.36. The first applicant
ordinarily earned a basic salary of
RIO 175.27 excluding the 13th cheque, standby, dayshift and overtime
allowances, per month.
The error was discovered on 08 January 2015.
Upon such discovery and on 12 January 2015, the first respondent
consented to or volunteered
that the balance that remained in his
account be transferred to the second applicant. At the time the
remaining balance was a sum
of R1 141 573.00. He had used the sum of
R751 153.35 and he has failed to pay back the same to date. He has
accrued pension benefits
to the value of R35 115.00 with the second
respondent.
[4] It is also
common cause that the total amount of the first respondent’s
salaries in respect of the Months of January to
April 2015, in the
sum of R34 620.05 was withheld by the second applicant, towards
liquidation of the outstanding balance. It seems
as if the first
respondent had agreed to repay the money that was still outstanding.
The parties are not in agreement as to what
the terms of the
repayment would have been. The outstanding balance after the
non-payment of three months’ salaries was reduced
to R717
533.30. After disciplinary hearing, the first applicant was dismissed
on 11 March 2015. The dismissal was confirmed on
appeal on 8 April
2015.
[5] The issue for
determination is whether the applicants are entitled to reclaim the
monies they aver are owed by the first respondent
on the basis of
conditio indebiti
[6] The applicants
aver that the payment was a bona fide error. Ms Kasselman erroneously
entered the number “6188” against
the function “standby
allowance”. These numbers are what used to be the last digits
of the first respondent’s
employee number at the time, his
employee number was 2206188. The system then automatically applied a
formula which calculated
the first respondent’s standby
allowance to the tune of R3 126 846.95. The actual number of standby
allowance should have
been 2 units which would have translated to a
sum of RIO 10.62. A unit of standby represents a week during which
the employee was
on standby to perform work. From the three R3 126
846.95 the system deducted total deductions of a sum of R1 236557.47
[7] Upon discovering
of the error and upon notification of the first respondent’s
bank, First National Bank, the bank froze
the first respondent’s
account. When the first respondent was asked to return to work as
soon as possible, he refused and
stated that he would discuss the
issue upon his return on 12 January 2015. He never notified the
applicant about the overpayment
at any stage. When he availed himself
he stated that he used the funds that were no longer in his account
for his personal needs.
He did not explain further about how he used
the said money.
[8] Even though they
discussed some options of how he would repay the money, he never came
back to finalise the details of repayment.
According to the second
applicant’s policy, the second applicant acted lawfully by
withholding first respondent’s salaries.
He was charged and
found guilty of gross dishonesty, unauthorised use of company funds
and unlawful enrichment, in a disciplinary
hearing. The second
respondent was required to verify his or her payslip. There is an
endorsement on employees’ payslips
that "any under or over
payments will be rectified”
[9] Finally, they
aver that the applicants are entitled to payment of first
respondent’s accumulated pension benefits that
are held with
the second respondent in terms of Section 37D (b)(ii) of the Pension
Funds Act 24 of1956.
[10] The first
respondent generally denies, all the facts put up by the applicants
except those recorded as being common cause between
the parties and
puts the applicants to the proof thereof. According to him he
received his payslip and the subsequent payment corresponded
with
what he had seen earlier in the payslip. Had the two not correlated,
he would have contacted the second applicant as he would
have found
no reason for a payment that was different to the one reflected on
his payslip. From the time he was contacted by the
second applicant
about the overpayment, he never withdrew any money from his account.
He also cooperated with the representative
of the second applicant
when they had to transfer the balance that remained in his bank
account.
[11] He also agreed
to repay the money he had used on condition that the second applicant
allowed him to continue with his employment
and make deductions from
his salary towards the settlement of the amount due to the second
applicant. It was however unlawful for
the second applicant to
withhold his entire salaries for the months January to April 2015,
leaving him without any means of income
for his support and that of
his family. He never took part in the calculation and payment of the
money into his account.
[12] The legal
position in as far as the actions for conditio indebiti are
concerned, is that a person who has paid a sum of money
or delivered
property to another person believing in error that it was due to such
person when in fact it was not due, is entitled
to recover the same
from the said person. The requirements for a remedy to be available
are that:
i) Payment was made
by the applicant or his agent;
ii) The payment was
made in debite in the wildest sense, without obligation;
iii) The error must
be excusable.
[13] The first
requirement is common cause in the present case. With regard to
excusability of the error, in Bowman De Wet and Du
Plessis NNO v
Fidelity Bank 1977(2) SA 35 (SCA), the Supreme Court of Appeal held
that conditio indebiti is available where a person,
acting in a
representative or fiduciary capacity, had made an overpayment under
bona fide mistake as to payee’s legal rights.
In a nutshell,
the Supreme Court of Appeal was of the view that excusability of the
error is not always a requirement, for example
in claims where third
persons act for the benefit of others and in the process commit a
bona fide mistake as to the rights of the
payees.
[14] In the present
case, the first respondent has no version as to how the error was
committed. The applicants on the other hand
have given full
explanation of how the error occurred, the first respondent would
like to persuade the court to believe that the
issuing of the payslip
was an indication that there was intention to make the payment which
indeed was subsequently made. In those
circumstances, he submits it
cannot be said the payment was made in error. In my view, there is no
basis for me not to accept that
the error happened in the manner that
the applicants have explained. I find that the clerical error in the
punching of more digits
than were supposed to have been punched
generated an obligation by the second respondent to pay standby
remuneration which otherwise
was non-existent. I am therefore
satisfied that requirement of the existence of an error was
satisfied. I reject the view that
because the payslip in the same
amount was generated earlier, the payment was not made in error
[15] In as far as to
instances where the payee could validly raise a defence against the
claim for repayment of money paid in debiti,
the payee must show that
it was not enriched. With regard to defences, in African Diamond
Exporters (PTY) LTD v Barclays Bank International
LTD 1978(3) SA 699
A, it was held that a defence of non-enrichment is available to the
person who received money indebite. However,
it cannot be open to a
defendant who was mala fides. According to the first respondent he
was not mala fides. He did not make any
further withdrawals after he
was notified of the overpayment. He cooperated with the process of
transferring the available amount.
He was not enriched, the money was
no longer available, he had used it. He, the first respondent was
absolved because the item
was destroyed. In my view, the first
respondent cannot succeed in these submissions. He has not been
forthcoming
about how he used
the money. His non withdrawals after he was notified of the
overpayment, could well be due to the fact that the
account was
frozen, no withdrawals could be possible in those circumstances. He
refused to avail himself for discussions about
the overpayment before
he was due to return to work on 12 January 2015.1 am also unable to
accept that he honestly believed that
the money was his due to the
fact that the payment correlated with his payslip. He could have and
was supposed to verify the payment
of an amount that was considerably
much more than his normal earnings.
[16] Mr Tobejane on
behalf of the first respondent submitted that the payment was
deliberately made by the first applicant. He sought
to rely on the
decision of Klein NO v South African Transport service and Other
1992
(3) SA S09N
where it was found that Trust Bank had available to it
machinery for making enquiries whether it should make a payment or
not,
but did not use it to do so, but instead proceeded to make a
payment. He submitted that similarly the applicants had available
resources, sophisticated systems that if they were used or checked,
could have made the applicants to realise the mistake, but they
failed to use them.
[17] I agree with
the submissions made on behalf of the applicants that the facts in
the Klein case are distinguishable from those
of the present case. In
the Klein case the court held that whatever authority the Trust bank
might have obtained from the insolvent
to make a payment, it
terminated when the insolvent was finally sequestrated. When the
Trust bank made the payment it was not acting
in ternis of subsisting
mandate. It was therefore not acting as agent for either the trustees
or insolvent when it made the payment.
These circumstances do not
arise in the present case. The first applicant at all material times
was acting based on the continued
mandate of its engagement by the
second applicant. The circumstances under which the finding about
deliberate payment being made
by Trust bank, were from a different
background. The Trust Bank had advised the insolvent, when requested
to issue a guarantee,
that the Trust Bank was to be irrevocably
authorised “to pay... in accordance with the guarantee on first
demand being made,
without any further reference to the debtor and
without requiring proof or the debtor's agreement that the amounts so
demanded
were due and not withstanding that the debtor may dispute
the validity of any such demands or payments. ”
[18] In my view the
applicant satisfied the requirement of a claim founded on conditio in
debiti accordingly, they are entitled
to an order for repayment.
[19] As regards the
order sought for payment by the pension fund, it was submitted that
the first respondent has not admitted liability
and the applicants
have no judgment against him. Section 37 D b(ii) bb of Pensions Funds
Act 24 of 1956 provides:
“ a registered
fund may deduct any amount due by a member to his employer on the
date of his retirement or on which he ceases
to be a member of the
fund in respect of compensation (including any legal costs
recoverable from the member in a matter contemplated
in subparagraph
(bb) in respect of any damage caused to the employer by reason of any
theft; dishonesty, fraud or misconduct by
the member in respect of
which Judgment has been obtained against the member in any court;
including a Magistrates Court ”
[20] In my view, the
circumstances on which the money due to be paid to the second
applicant by the first respondent are included
in the above section.
The first respondent was found guilty of gross dishonesty, amongst
others, in the second applicant’s
disciplinary hearing. I find
no reason to quarrel with that conclusion for reasons already alluded
to, about his conduct after
receipt of the money, elsewhere in this
Judgment. The feet of clay in the submission on behalf of the
applicant is to imagine that
the order in terms of this section must
be distant in time from when Judgment is obtained. In my view, a
proper case has been made
for the deduction and payment to be made.
Judgment for payment of the amount has been granted. The applicants
are therefore entitled
to an order for realisation of the judgment.
[21] This brings me
to the issue of costs. The applicants seek costs on a punitive scale
on the basis that the first respondent's
actions amounted to theft or
fraud. The submission on behalf of the first respondent in this
regard is that he did not participate
in the payment of the money
into his account, therefore he should not be ordered to pay costs.
[22] It is an
established principle that costs follow the results. The applicants
are successful in their application. Therefore
they are entitled to
costs. However, I do not agree with the submission that the liability
of the first respondent on conditiojndebiti
should be extended to
include a finding of theft or fraud. He may have acted in a manner
that was less than candid, and was thereby
dishonest. Nevertheless, 1
find no basis for an award of costs on a punitive scale.
In the result I make
the following order:
1. The first
respondent is hereby ordered to make payment to the second applicant
in the amount of R716 533.30;
2. The first
respondent is hereby ordered to make payment to the second applicant
of interest on the aforesaid amount at the rate
of 9% per annum
calculated from 25 November 2014 to date of payment;
3. The second
respondent is hereby directed and authorised to make payment of the
respondent’s accumulated pension benefits
in the sum of R35
115.00 or such higher amount as may have accumulated since, which
amount shall not exceed the amounts set out
in orders 1 and 2 above,
to the second applicant in terms of the provisions of
section 37D
(b)(ii)(bb) of the
Pension Funds Act no.24 of 1956
in order to
satisfy a portion of the first respondent’s indebtedness, as
set out in orders 1 and 2 above.
4. The first
respondent is hereby ordered to pay the costs of the application
MAJIKIJ
JUDGE OF THE HIGH
COURT
ACTING IN GAUTENG
DIVISION, PRETORIA
Appearances
Counsel for the
plaintiff : MrM. Rusa
Instructed by :
Messrs. Bowman & Gilfillan
141 Boshoff
Street Muew
MEUKLENUEK Tel
No.: 012 4528200 Ref. Mr M. Rusa / 6146095
Counsel for the
defendants : Mr L.E. Tobejane
Instructed by :
Messrs. Maledye Motaung Mtembu Inc.
4th Floor, 405
Trovisus Building
523 Church Street
PRETORIA
Tel No.: 012 341
7964
Ref. L E
Tobejane/105096
Date of hearing :
29 February 2016
Date of Judgment:
09 March 2016