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[2016] ZAKZPHC 113
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Liberty Group Ltd v Shaazura Investments CC and Another (7417/09) [2016] ZAKZPHC 113 (15 September 2016)
NOT
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
KWAZULU-NATAL
DIVISION, PIETERMARITZBURG
Case
No: 7417/09
In
the matter between
LIBERTY GROUP
LTD PLAINTIFF
and
SHAAZURA
INVESTMENTS
CC
FIRST
DEFENDANT
MOHAMMED
SHAAZ
MOOSA
SECOND
DEFENDANT
JUDGMENT
Delivered
on: 15 September 2016
MOODLEY
J:
[1]
In this action an insurance company sues a brokerage and its surety
for repayment of commission advanced to the brokerage.
[2]
The plaintiff, Liberty Group Ltd (Liberty) advanced commission to the
first defendant, Shaazura Investments CC (Shaazura) on
premiums
received by Liberty on contracts issued pursuant to proposals
submitted by Shaazura. The payment of commission was advanced
in
terms of a Broking agreement entered into by the parties, which was
deemed to have commenced on 4 April 2006. A relevant
material
term of the Broking agreement was that if any of the policies
subsequently lapsed or were cancelled or reduced or terminated
within
the period mentioned in the agreement, Shaazura would become liable
to repay to Liberty the commissions advanced for those
policies.
[3]
In 2005 the second defendant, Mohammed Shaaz Moosa (Mr Moosa), signed
a deed of suretyship in terms of which he bound himself
jointly and
severally as surety and debtor
in solidum
with Shaazura for
payment to Liberty, on demand, of all sums of money which Shaazura
was at any time indebted to Liberty. The
material terms of the
suretyship are not disputed and therefore do not bear repetition
except to note that the suretyship remains
in full force and effect
until all indebtedness, commitments and obligations of Shaazura to
Liberty are fully discharged and no
liquidation or insolvency,
whether provisional or final, or any payments or dividends received
by Liberty, will prejudice the rights
of Liberty to recover the full
sum remaining owing by Shaazura from Mr Moosa.
[4]
By December 2007 Shaazura had become indebted to Liberty in a sum in
excess of R700 000, being advanced commission which
had become
repayable to Liberty in accordance with the Broking agreement,
because policies written by Shaazura had been reduced,
terminated,
cancelled, or lapsed. Negotiations took place between representatives
of Liberty, in particular Mr Craig Ebersohn the
manager of its
Pietermaritzburg branch, and Shaazura, represented by Mr Moosa, to
resolve the repayment of the debt.
[5]
On 19 June 2008 Mr Moosa signed a ‘Deed of Settlement’
(‘the agreement’) in terms of which Shaazura,
the debtor,
acknowledged that it was indebted to Liberty in the sum of R700 000,
in respect of the repayment of advanced commissions
in terms of the
Broking agreement and schedule of commission. The material
terms of the agreement were inter alia:
1. Shaazura was obliged
to liquidate the capital sum and interest by way of monthly
repayments over a period of 16 months;
2. The first payment in
the sum of R49 203.35 was due and payable on or before 1 June
2008;
3. The subsequent
payments were payable on or before the last day of every succeeding
month until the debt was paid in full;
4. The monthly
installments were to be debited from Shaazura’s commission
account held with Liberty;
5. In the event of
default of payment by Shaazura, Liberty was entitled to apply for a
judgment against it for the full amount outstanding
together with
interest and costs without further demand, or a court order for
payment of the judgment debt in installments, or
an emoluments
attachment order or a garnishee order;
6. Penalty interest on
the arrear amounts would be payable at the same rate of interest as
charged on the capital debt; and
7.
Shaazura would pay commission and legal costs on an attorney and own
client scale if an attorney recovered any outstanding amount
of the
debt.
[6]
However Shaazura failed to make any payment in accordance with the
agreement. Consequently in August 2009 Liberty instituted
the present
action against the defendants alleging that Shaazura had breached the
agreement by failing to make any payment which
had fallen due and the
full debt had become due, owing and payable; and that Mr Moosa was
bound, under the terms of the suretyship,
to discharge Shaazura’s
indebtedness to Liberty.
[7]
Liberty seeks judgment against the first and second defendants,
jointly and severally, the one paying the other to be absolved,
for
payment in the sum of R838 024.43, interest and costs on an attorney
and own client scale. Although the agreement had not been
signed by
Liberty, Liberty has contended that as the agreement was an
acknowledgement of debt, its signature was not required in
order to
be valid and binding on the defendants.
[8]
Both defendants initially defended the matter and raised two special
pleas. But at the commencement of the trial Mr
Steyn
,
who represented Liberty, handed up a letter dated 11 November 2014
from the liquidators of Shaazura, confirming that the company
was in
liquidation and that the liquidators would abide by the court’s
decision.
[1]
[9]
Mr Moosa withdrew one special plea but persisted with his defence on
the merits and his special plea that the agreement was
not valid, and
denied that any payment was due to Liberty by the defendants.
[10]
In his plea, Mr Moosa contended that the agreement constituted an
offer by Shaazura but there had been no acceptance of the
offer by
Liberty, because Liberty or its representatives had failed to sign
the agreement. Shaazura had subsequently withdrawn
its offer to
Liberty. Therefore the agreement had not been concluded, and was,
accordingly, null and void and Liberty has no claim
against the
defendants arising from the agreement.
[11] Alternatively,
should the agreement be found to be valid and binding on the
defendants, Mr Moosa pleaded that Liberty had failed
to comply with
paragraph 3 of the agreement, in that it had unilaterally closed
Shaazura’s commission account, in which there
were funds, and
further failed to debit the account with the monthly installments,
although it was an implied, alternatively tacit,
term of the
agreement that Shaazura would continue to have a commission account
with Liberty, into which further funds generated
by the policies sold
by Shaazura would be transferred. The defendants had therefore not
breached the agreement and were not liable
for payment of any monies
to Liberty, although the certificate of indebtedness reflecting the
capital debt, interest and costs
claimed by Liberty was not disputed
by the defendants.
[12]
The terms of the Broking agreement and the suretyship were not
in dispute. It is common cause that:
1. By
June 2008, the parties had agreed, after discussions between Mr
Ebersohn and Mr Moosa, that advanced commission in the sum
of
R700 000 was repayable to Liberty by Shaazura;
[2]
2. Negotiations took
place between representatives of Liberty and Mr Moosa in respect of
the repayment of advanced commission;
3. Pursuant to the
negotiations, the agreement was drafted by Ms Chantal Muldoon, the
Head of legal services for Liberty;
4. Mr Moosa signed the
agreement on 19 June 2008; but the agreement was erroneously dated 19
June 2007;
5. The agreement was not
signed by or on behalf of Liberty; and
6. No instalments were
debited from Shaazura’s commission account with Liberty.
Issues
for Determination
[13]
The two issues for determination are:
1. Whether Liberty has
proved on a balance of probabilities that the agreement is a valid
contract and enforceable against the defendants;
and
2.
Whether Liberty was
mora creditoris
in that it had made it
impossible for Mr Moosa to comply with the terms of the agreement by
failing to enable its computer system
to process new business written
by Mr Moosa and to receive commission from existing policies.
Liberty bears the
onus
on the first issue and the defendants on the second.
Liberty’s
Case
[14] Liberty called two
witnesses. The first, Mr Craig Ebersohn, who was the Branch
Manager in Pietermaritzburg from March
2008, testified that he had
dealt with Mr Moosa after the advanced commissions in the sum of
R700 000 had become repayable
by Shaazura. Liberty assisted
brokers who were similarly indebted to it, to liquidate their
liability either by way of payment
in cash or by negotiating an
agreement with the broker, in terms of which the broker would sign an
acknowledgment of debt and undertake
to settle his liability by
generating new business and paying off the debt through the
commission earned.
[15]
In a similar vein, an agreement was negotiated with Mr Moosa in
respect of the R700 000 due by Shaazura to Liberty. Mr
Ebersohn
testified that he had held numerous meetings with Mr Moosa to
negotiate and resolve the payment of the debt because he
held the
view that an agreement would be mutually beneficial: Liberty would
get new business and Shaazura would generate income
and settle the
monies owed to Liberty in accordance with the agreement. The Regional
Manager, Mr Grant Hopkins, had also met with
Mr Moosa on one
occasion, together with Mr Ebersohn to discuss why the defendants had
not written new business. Mr Moosa had expressed
his intention to
settle the debt and it was agreed that the debt would be settled
through the commission earned on new business
written by Mr Moosa.
[16]
Mr Ebersohn subsequently negotiated the terms of the agreement with
Mr Moosa but the agreement was prepared by the Debt Management
Department and Ms Chantal Muldoon, who provided Mr Ebersohn with
legal support. To his recollection, the agreement had been signed
by
Mr Moosa in his presence in Liberty’s boardroom and then sent
to the Debt Management Department, whose responsibility
it was to
acknowledge receipt of the agreement and attend to the signing of the
agreement by Liberty.
[17]
Mr Ebersohn testified that clause 3 of the agreement, which provided
that commission earned by the broker would be set off
against the
debt owing, reflected the intention of the parties that Mr Moosa
would earn commission while the debt was being liquidated.
To his
knowledge, once an acknowledgment of debt was signed by the broker,
the terms of the settlement would be captured onto Liberty’s
system so that commission generated by the broker, if any, would be
set off against the debt and any excess paid to the broker.
[18]
He therefore believed that Liberty would have ensured that the
commission account and code remain open while the broker was
earning
commission. However even if the code were closed or terminated,
commission from existing policies would be generated and
flow into
the commission account, although no new business could be submitted.
The commission code was only terminated when the
defendants failed to
pay or submit new business. However the instalments payable in terms
of the agreement could not be debited
from Shaazura’s
commission account because it had a negative balance.
[19]
After the agreement was signed, Mr Ebersohn had regular interaction
with Mr Moosa, who despite promises to write new business,
failed to
do so. Pursuant to correspondence between Ms Muldoon and Mr Hopkins
on 14 July 2008 about the failure of the defendants
to make payment
or generate new business, he was requested by Mr Hopkins to hold a
serious discussion with Mr Moosa and place him
on terms to pay,
failing which legal proceedings would be instituted. Mr Ebersohn duly
met with Mr Moosa and recorded his discussions
at the meeting in an
email dated 15 July 2008 to Ms Muldoon and Mr Hopkins.
[20]
But concerted attempts to recover the debt from the defendants
failed, and the matter was handed over to the legal department
at
Liberty’s head office with instructions to terminate the
contract and to proceed with legal action for recovery of the
debt.
[21]
Under cross-examination Mr Ebersohn described the settlement reached
between the parties as ‘standard protocol’
which had been
explained to Mr Moosa. To his understanding, although entitled ‘Deed
of Settlement’ because it was indicative
of the settlement
reached by the parties, the agreement was effectively an
acknowledgment of debt by the defendants.
[22]
Although he conceded that he may have erred in his recollection of
where the agreement was signed, Mr Ebersohn remained adamant
that Mr
Moosa had signed the agreement because it reflected the negotiations
between the parties: the defendants had agreed on
the manner in which
the debt was to be liquidated, Liberty’s legal department
prepared the agreement and Mr Moosa had committed
himself to the
repayment in accordance with the terms of the acknowledgment of debt
by signing it.
[23]
Mr Ebersohn persisted that, although the defendants code had
previously been suspended as reflected in an email dated 12 December
2007 from Mr Hopkins, the code was open to enable Mr Moosa to write
new business. He was of the view that Nassar Hoosen (Mr Hoosen),
a
broker consultant who had been allocated to the defendants in order
to facilitate an amicable resolution and to process new business
written by Mr Moosa, would have brought any problem with the code or
commission account to his attention, as he was aware that
Mr Ebersohn
was monitoring the debt and had to report regularly to Liberty’s
head office. However neither Mr Hoosen nor Mr
Moosa advised him that
there was a problem with the code or that Mr Moosa had been unable to
submit new business.
[24]
Ms Muldoon testified that in June and July 2008 she worked in the
Debt Management Department and dealt with brokers on
commission-related
issues. She had no direct communication with Mr
Moosa but Mr Ebersohn requested her to prepare an acknowledgement of
debt because
Shaazura was going to pay a large debt in installments.
She prepared the agreement
[3]
which was sent to Mr Ebersohn for completion and subsequent return to
the head office.
[25]
Ms Muldoon obtained the figures for the debt owing to the plaintiff,
as reflected in clause 2 of the agreement, from the commission
statement of the first defendant. The monthly installments and period
over which the payment was to be effected were usually proposed
by
the Branch Manager and the debtor together because they would know
the rand value of the business submitted by the broker. The
repayment
period and the monthly installment reflected in clause 3 were
provided to Ms Muldoon who then prepared the agreement
and sent it to
the Branch.
[26]
Although Ms Muldoon was aware that the original agreement was
returned to head office and filed, she did not know why Liberty
had
not signed the agreement. She had however, on the basis of the
agreement, created a loan account in respect of the capital
debt with
a commencement date of 30 June 2008 and an end date of 30 September
2009. The loan was referred to as a ‘New aod
loan’. The
monthly installment was reflected on the commission account as a
debit to be paid by the broker either by way
of cash or commission.
[27]
Ms Muldoon personally monitored the accounts and sent several emails
to Messrs Hopkins and Ebersohn when no payment into the
commission
account or by the debtor was reflected on the system. She disputed
that Mr Moosa was prevented from submitting new business
because the
commission code was suspended or closed, stating that the code would
not have been suspended because there was money
due by the broker.
[28]
Ms Muldoon also disputed that the defendants’ offer to pay had
not been accepted as Liberty did not sign the agreement,
stating that
Liberty’s acceptance was demonstrated by the opening of the
loan account and the opportunity afforded to the
defendants to make
monthly payments. She pointed out that Mr Moosa only became aware of
the status of the account after the Branch
Manager requested them to
terminate the account on 1 August 2008.
[29]
Ms Muldoon confirmed that she had instructed Ms Elaine Odendaal, the
Contracting Manager responsible for the opening and termination
of
codes, per email at 4:01pm on 1 August 2008 to terminate all
commission codes for Mr Moosa, and Ms Odendaal had in turn instructed
her administrator per email shortly thereafter on the same day, to
‘terminate the whole brokerage and all sub-codes. Total
commission and handed over. Also put it on hold’.
[4]
Suspension of a commission code would be effected by the
Contracting Department on the instructions of the Branch Manager.
[30]
Ms Muldoon explained the difference between ‘suspension’
and ‘termination’ in the context of the brokers.
If a
code was ‘suspended’ the broker was still active, but the
code was closed to new business. Brokers were ‘terminated’
when they no longer wrote business for Liberty.
[31] Ms Muldoon
acknowledged that according to the email from Mr Hopkins dated 16
April 2008 the defendants’ code had been
suspended. But she
persisted that the code would have been changed if the broker had
been given an opportunity to offset commission
against his debt,
after he signed the acknowledgment of debt, although the opening of
the loan account on its own would not have
affected the suspension.
Application
for Absolution
[32]
At the end of Liberty’s case Mr
Bezuidenhout
applied for
absolution from the instance of the defendants. He submitted that
Liberty had failed to prove a valid contract. The
document relied on
by Liberty was a settlement agreement and not an acknowledgment of
debt; therefore the ordinary principles of
contract applied and the
contract would only have been concluded when the defendants offer of
repayment was accepted and both parties
appended their signatures for
which provision was made on the agreement. The agreement was not
signed by Liberty. The defendants
were consequently not bound by the
terms thereof as there was no contract.
[33] Mr
Steyn
opposed the application on behalf of Liberty, contending that there
was no statutory or legal requirement that the agreement had
to be
signed by Liberty to be valid and binding on the defendants. The
liability of the defendants to Liberty was not disputed
and the
agreement was prepared to reflect the arrangements Mr Ebersohn had
negotiated with Mr Moosa for the repayment of the sum
due to Liberty.
Liberty made the offer by preparing the agreement and the debtor
accepted the offer to repay the admitted debt
on the terms set out in
the agreement when he signed it. Further an acknowledgment of debt
does not require acceptance by the creditor,
nor was there a
counter-offer requiring acceptance by Liberty. The terms of the
agreement were implemented by Liberty and the defendants
account
monitored. Mr
Steyn
contended that there was sufficient
evidence to sustain Liberty’s case.
Ruling
[34]
When absolution from the instance is sought at the close of the
plaintiff’s case the test to be applied is not whether
the
evidence established what would finally be required to be
established, but whether there is evidence upon which a court,
applying
its mind reasonably to such evidence, could or might (not
should, or ought to) find for the plaintiff.
[5]
The
application was refused as I was satisfied that on a reasonable
consideration of Liberty’s case, there was sufficient
or
prima
facie
evidence
to avert a ruling of absolution.
The
Defendants’ case
[35]
Mr Moosa, who had become a broker for Liberty in 2006, admitted that
monies had become repayable to Liberty by December 2007
and that the
impugned agreement embodied the result of his various negotiations
with Liberty. He had had discussions with Mr Hoosen
and Mr Ebersohn’s
predecessor, but had only met with Mr Ebersohn on two occasions: when
Mr Ebersohn took up his post as Branch
Manager and when he met Mr
Ebersohn and Mr Hoosen about the debt.
[36]
Mr Moosa had signed the agreement which Mr Hoosen brought to his
office, because Mr Hoosen had told him that Liberty required
the
agreement to decide whether to accept the defendants’ offer or
not. He therefore understood that, in accordance with
clause 3.1 of
the agreement, Liberty had to accept his offer that he be allowed to
write business and the commission generated
from that business be
utilized to pay off the debt. However he did not receive the
requisite confirmation from Liberty that he
could write new business.
[37]
When Mr Moosa handed the signed agreement to Messrs Ebersohn and
Hoosen at a restaurant, Mr Ebersohn advised Mr Moosa that
he did not
have the authority to make a decision on the agreement and had to
await confirmation from head office. Thereafter Mr
Moosa had no
further discussions with Mr Ebersohn and dealt only with Mr Hoosen.
He did not receive any written communication from
Liberty, although
he had advised Liberty that the code which had been suspended had to
be opened to enable him to submit new business.
[38]
At the time when he signed the agreement Mr Moosa was not writing
business because his clients had been told that his broker
code had
been cancelled and subsequently, Mr Hoosen had repeatedly advised him
that his code was suspended. Further Mr Hoosen and
another broker
approached his clients to write new policies, which affected the
commission generated by his ‘good business’.
Therefore
although he had written new business, he could not submit the
proposals to Liberty and lost the business to other brokers,
and did
not earn commission to comply with his undertaking to pay the debt.
[39]
Although he made numerous requests for the suspension to be uplifted,
Mr Moosa did not receive any notification nor was he
informed that
the suspension had been uplifted. Initially he was advised that the
Branch was waiting for the decision by head office.
But it became
apparent to him that his existing client database was being eroded by
other brokers. He was nevertheless shocked
when informed by his
attorney that his code had been terminated.
[40]
Under cross-examination Mr Moosa confirmed that the value of his
indebtedness had initially been in dispute but after negotiations
he
and Mr Ebersohn had agreed on the sum of R700 000. He also
confirmed that the terms recorded in the agreement, inter alia
in
respect of the debt owed by Shaazura and the repayment in
instalments, accorded with the terms he had agreed to with Mr
Ebersohn.
But he persisted that Mr Ebersohn had told him that he
would forward the agreement to Liberty’s head office; and if
his proposals
were accepted, he would receive confirmation from the
head office.
[41] The defendants did
not call further witnesses.
Argument
[42]
In their closing arguments, counsel reiterated and supplemented the
arguments presented in the application for absolution.
[43]
Mr
Steyn
submitted that even on the Mr Moosa’s own
version that he made proposals to Liberty, by preparing the agreement
in accordance
with those proposals Liberty had accepted the
defendants’ offer, and would therefore have not reserved the
right to accept
or reject the offer. However as the agreement was an
acknowledgment of debt incorporating the terms of repayment, had it
emanated
from the defendants, Liberty would have the election to
accept or reject the terms of repayment. But as the document had been
prepared
by Liberty and submitted to the defendants for signature,
Liberty would and could not have reserved the right to accept or
reject
the agreement.
[44]
On the other hand Mr Ebersohn’s evidence that he negotiated the
settlement with Mr Moosa and forwarded the agreed terms
to the Debt
Management Department so that the agreement could be prepared
incorporating the agreed terms was corroborated by Ms
Muldoon. Once
the agreement was signed Liberty demonstrated the acceptance of the
terms of the agreement by creating a loan account
to enable the
repayments to be credited against the debt owed by the defendants and
monitoring the repayments. Although Mr Moosa
has pleaded that the
offer was withdrawn when Liberty failed to accept his proposal he has
not testified how and when the offer
was withdrawn.
[45]
In respect of the defence of
mora creditoris,
Mr
Steyn
submitted that the defendants had failed to discharge their onus to
prove that Mr Moosa had made a valid tender to comply with
their
obligations under the agreement by submitting new business and that
he was prevented by the failure of Liberty to co-operate
and enable
him to earn commission by uplifting the suspension on his commission
code and/or account. Nor had the defendants made
any demand on
Liberty to open or uplift the suspension of the code, even if there
had been an oversight on the part of Liberty.
He submitted in
conclusion that Liberty was entitled to the relief sought.
[46]
Mr
Bezuidenhout
contended in response that Liberty’s
cause of action was the breach of the agreement and not an
acknowledgment of debt and
that only in argument had Mr
Steyn
described the agreement as ‘a settlement agreement
incorporating an acknowledgment of debt and terms of repayment’.
He pointed out that it is apparent from the format and content of the
document that it is a settlement agreement and therefore
requires
both parties to sign before it becomes a valid and binding contract.
Although it was the intention of the parties to record
their
discussions in writing, when Mr Moosa signed the contract he became
the offeror. Therefore Liberty was required to accept
the offer by
signing the agreement and Mr Ebersohn confirmed that the agreement
was sent to Liberty’s head office for signature.
The agreement
also made no provision for payment in the event that insufficient
commission was generated to meet the repayment.
He submitted that
Liberty had therefore failed to discharge its onus to show that the
agreement was valid.
[47] Mr
Bezuidenhout
submitted further that Liberty had presented no evidence confirming
that the code was opened after it was suspended in 2007. Ms
Muldoon
had testified that the opening of the loan account did not affect the
code. Further given the distinction between suspension
and
termination of the codes, the termination did not preclude the
failure to uplift the suspension as alleged by the defendants.
He
concluded with the submission that the action consequently fell to be
dismissed with costs.
Evaluation:
[48]
Although Mr Ebersohn’s memory failed him in respect of where
the agreement was signed by Mr Moosa, he was confident about
his
negotiations and discussions with Mr Moosa before and after the
agreement was signed and his motivation for negotiating the
terms for
repayment of the debt by the defendants. His objective was a mutually
beneficial arrangement, which enabled the defendants
to earn
commission and pay off the debt. The same resolution was suggested by
Mr Hopkins, in his email dated 16 April 2008:
‘
What
I am wanting to try and achieve is that we work with this broker who
has shown that he is wanting to resolve the debt by instituting
an
AOD with a payment of R50 000 per month until the debt is paid
off. The broker has suggested that if he is able to pay
more back
monthly he would do this but does need to live at the same time. He
has business to submit to us but due to the fact
that we have
suspended his code he is not able to do so.
…
as
far as I can ascertain the broker wants to resolve this debt and I
would like to suggest we work with him and put an AOD in place
and
monitor it on an ongoing basis until the debt has been paid.’
[49]
Mr Ebersohn also testified that Mr Hopkins held a meeting with Mr
Moosa, at which he was also present where the same resolution
was
discussed and Mr Moosa was asked to explain why no new business was
forthcoming from him. Mr Moosa had advised them that he
would write
business but failed to do so. This evidence remained undisputed, and
it was put to Mr Ebersohn that according to Mr
Moosa, the meeting
took place before the agreement was signed. Mr Moosa confirmed that
the agreement correctly recorded the terms
he had agreed to with Mr
Ebersohn.
[50]
Therefore Mr Moosa would have been aware that the terms of settlement
were acceptable to Liberty and that there was no need
for Mr Ebersohn
to receive any authorization or confirmation to finalise an
acknowledgment of debt on the suggested terms. Further
Mr Moosa
conceded that Mr Ebersohn capped the debt at R700 000 without
his authority being called into question, and it was
not put to Mr
Ebersohn that he did not have the authority to settle and agree to
the terms of repayment. Ms Muldoon also confirmed
that the terms of
repayment were agreed to by the Branch Manager and the broker, and
her evidence that once Liberty received the
agreement signed by the
defendants, she captured the details, opened the loan account and
monitored the payments is also in accordance
with the resolution and
terms proposed by Mr Hopkins.
[51]
Mr Ebersohn’s testimony that he met Mr Moosa on several
occasions and communicated with him regularly in order to finalise
the indebtedness and terms of repayment and to query his failure to
write new business and pay the instalments as undertaken, was
not
disputed under cross-examination. Nor was it put to Mr Ebersohn, who
confirmed that Mr Hoosen was appointed to facilitate the
resolution
and process the new business written by Mr Moosa, that, except for
two occasions, it was only Mr Hoosen and not Mr Ebersohn
who met with
Mr Moosa. Mr Ebersohn’s evidence was only disputed when Mr
Moosa testified.
[52]
Mr Ebersohn testified that he had ‘engaged personally with Mr
Moosa on an ongoing basis’ and that Mr Moosa had
expressed a
commitment to settle the debt, although he had repeatedly experienced
difficulty getting hold of Mr Moosa subsequent
to the signing of the
agreement. In response to Mr Hopkin’s email on 14 July 2008
requesting Mr Ebersohn to have a ‘serious
discussion with
Shaaz’, on 15 July 2008, Mr Ebersohn emailed Mr Hopkins and Ms
Muldoon stating:
‘
I
expressed the seriousness and importance of him settling this debt
and he acknowledged this and expressed his commitment to supporting
us. He is attending training the ELM products on Thursday at our
branch and has existing funds he intends to channel to us in this
regard. I will however make contact/see him again and monitor
the state on an ongoing basis.’
[53]
In a later email dated 1 August 2008 to Ms Muldoon and copied inter
alia to Mr Hopkins, Mr Ebersohn wrote:
‘
Repeated
attempts to convince Shaaz Moosa to settle his outstanding debts have
proven to be unsuccessful. Numerous promises to either
submit new
business or deliver a cheque have come to nothing! As per our
agreement with him, and unless he responds within the
next hour,
please ensure his code is closed to new business and he is handed
over for legal action! Please ensure swift action
in this regard and
keep us informed as to progress.’
[54]
The aforegoing emails corroborate Mr Ebersohn’s assertion that
he met with Mr Moosa personally on several occasions,
and despite
many unsuccessful attempts to contact him, he discussed his failure
to pay several times directly with Mr Moosa who
responded with
numerous promises to pay as undertaken.
[55]
On the other hand, Mr Moosa’s denial of Mr Ebersohn’s
testimony and his own version of his limited interaction
with Mr
Ebersohn is unconvincing in several respects.
[56] Although he admitted
that Mr Ebersohn entered into negotiations with him about the
repayment of the debt, Mr Moosa alleged
that all communication with
Liberty, except for two occasions when he met Mr Ebersohn, was only
through Mr Hoosen. Yet it was pointed
out to Mr Moosa under
cross-examination, that the meeting with Messrs Hopkins and Ebersohn
took place before the agreement was
signed which constitutes a
contradictory admission of a further interaction with Mr Ebersohn.
[57]
Mr Moosa refused to admit that Mr Hoosen had no authority except to
act as a conduit of information between Mr Moosa and Mr
Ebersohn and
that discussions with Mr Hoosen did not lead to the conclusion of any
agreement, stating that he believed that Mr
Hoosen was ‘influential’.
But he admitted that the agreement contained the terms he had agreed
to with Mr Ebersohn,
not Mr Hoosen.
[58]
Mr Moosa testified that Mr Ebersohn had entered into negotiations
with him about the debt because he knew that the defendants
had good
business and influential clients. But when asked if Mr Ebersohn had
expressed the desire to keep him in business, Mr Moosa
backtracked,
replying that he had informed Mr Moosa that he would put his case
forward to the head office, which would revert to
him. Yet it is
apparent from the evidence and the correspondence furnished by
Liberty that Liberty accommodated the defendants’
constraints
by agreeing that they could liquidate their acknowledged debt in
instalments.
[59]
Mr Moosa confirmed that the value of his indebtedness was agreed with
Mr Ebersohn at R700 000, but alleged that he proposed
the terms
of repayment reflected in the agreement and that Mr Ebersohn had
advised him that he had to forward the agreement to
the head office
for confirmation and instructions, or he would have opened the code.
This alleged response by Mr Ebersohn was not
put to him during
cross-examination, although Mr Moosa insisted that he had instructed
his counsel accordingly. Further, it is
apparent from the oral
evidence and the emails furnished to the court, that Mr Ebersohn, as
Branch Manager, could not ‘open
the codes’ as suggested
by Mr Moosa.
[60]
Mr Moosa confirmed that Liberty had through Mr Hoosen presented the
agreement to him which was in accordance with his proposals
to
Liberty, but added that Mr Hoosen had told him that he needed to get
confirmation that the debt was R700 000. When reminded
of his
earlier testimony that he had agreed the debt at R700 000 with
Mr Ebersohn, Mr Moosa conceded that he had, but refused
to admit that
Mr Ebersohn could therefore not have said that he needed confirmation
of the debt by head office, responding that
Mr Ebersohn must have
said so ‘in passing’. Similarly Mr Moosa testified that
he was specifically advised by Mr Hoosen
that he could not submit
business because the code was not opened but subsequently alleged
that Mr Hoosen had advised him that
a response was awaited from head
office.
[61]
Having agreed that Liberty’s head office had accepted the debt
at R700 000 and was ‘happy’ with the
terms of
repayment because the debt and the repayment terms were recorded in
the agreement, and that he had no quibble with any
of the other terms
in the agreement, Mr Moosa evaded a direct response to the logical
proposition that his proposals had therefore
been accepted by
Liberty, responding that, to his knowledge, the agreement was a
settlement agreement, not an acknowledgment of
debt and he would be
able to write business to pay off the debt. When pressed to admit
that even on his version that he had made
proposals to Liberty, his
confirmation that the agreement contained all his proposals indicated
the head office at Liberty had
accepted his proposals, Mr Moosa
simply responded that Liberty was supposed to open the codes.
[62]
Mr Moosa alleged that he was not aware that Liberty would uplift the
suspension on receipt of the agreement and that he had
unsuccessfully
attempted to get hold of Mr Ebersohn to confront him about being
unable to write business. But when asked if he
had written to Mr
Ebersohn or anyone at Liberty advising them that he could not pay
because he was unable to submit his business,
Mr Moosa responded that
he could not contact Mr Ebersohn and was referred to Mr Hoosen, who
always facilitated any interaction
with Mr Ebersohn.
[63]
It was only at this late stage that Mr Moosa alleged that Mr Hoosen
had stopped communicating with him because Mr Hoosen and
other
brokers were diverting his business. He was unable to explain why
Liberty would take away his business when it had negotiated
a
settlement with him which was dependent on the business he wrote.
Further this version of his existing and prospective
business
being eroded by other brokers and that Liberty was sabotaging his
prospects of earning commission by redirecting his clients,
was not
put to Mr Ebersohn who specifically testified that Mr Hoosen as the
broker consultant, would have known if there were problems
with the
submission of new business and communicated the difficulty to him.
Nor did Mr Moosa explain why he did not communicate
directly with Mr
Ebersohn if Mr Hoosen was undermining his business. Instead he
offered a garbled response that Mr Ebersohn may
not have been aware
of what was taking place although he would have attended meetings
with Mr Moosa’s clients; or he may
not have directed business
away from Mr Moosa intentionally; or he may have been guided by Mr
Hoosen.
[64]
This version, in my view, was a further late fabrication by Mr Moosa,
a view that was fortified by his response when questioned
about his
failure to discover his proposals for new business, that the issue
was not whether his ‘business was being accepted
or not’.
However when he subsequently conceded that his case was that he had
business which he could not submit and that
Mr Hoosen did not take
his proposals, he alleged that he had not discovered the proposals
because the dispute was ‘whether
the document was an
acknowledgment of debt or a settlement agreement’.
[65]
Mr Moosa confirmed that paragraph 10.2.5 of his plea viz ‘Plaintiff
unilaterally closed the First Defendant’s commission
account
not allowing further funds to be transferred thereto’ was in
accordance with his instructions and referred to the
closure in
December 2007. However as the ‘closure’ occurred before
he signed the agreement, his allegation is inconsistent
with his
further plea that due to the conduct of Liberty in closing the
account, he could not comply with clause 3 of the agreement.
[6]
Mr Moosa also acknowledged that the account may not have been
terminated or closed but suspended, but he had considered suspension
and closure to be the same. Nevertheless, it was undisputed that even
if the account were suspended, the commission generated by
existing
business would have flowed into the account. But Ms Muldoon who
monitored the accounts reported that there were no funds
in Mr
Moosa’s account to debit, which was reflected in the statements
of the commission account. However in his affidavit
opposing summary
judgment
[7]
Mr Moosa alleged
that Shaazura had earned commission but Liberty failed to debit the
commission account; he did not allege that
Liberty had closed and
failed to open his commission code.
[66]
Mr Moosa disputed that there was no commission because he did not
earn any, insisting that there was commission from earlier
business.
This allegation was contradictory to his version that Mr Hoosen and
other brokers were eroding his ‘good business’
and his
clients were advised that his commission code was closed. Mr Moosa’s
belated allegation that Mr Hoosen and other
brokers eroded his
business was, in my view, an attempt to explain his failure to
generate commission to liquidate the debt, although
he may have
generated substantial commission prior to 2007. Being independent,
the defendants were not restricted to submitting
business only to
Liberty; and there was no bar to the diversion of existing business
to frustrate the recovery of the debt by Liberty.
A few debits and
credits are reflected on the defendants’ commission account,
[8]
which indicates that there was activity on the account. Therefore
commission from existing business could not have been blocked.
[67]
Finally, after vacillating between being unable to submit proposals
online and Mr Hoosen’s role in not submitting his
proposals
because of the awaited response from Liberty, Mr Moosa admitted that
it was possible that Liberty had opened the commission
code but,
because he was not informed by Liberty that the code was open, he did
not know the account was operational. His response
was not consistent
with his allegation that he had been unable to submit his proposals
online to Liberty and that he was advised
by his clients that his
commission code was closed.
[68]
The agreement was signed by Mr Moosa in June 2008. By July 2008 there
was already communication between Liberty’s head
office
personnel and the Branch Manager about Mr Moosa’s failure to
meet the repayments. But there is no reference in their
correspondence to any communication from Mr Moosa about the alleged
impediment created by a suspended code, only that he had repeated
his
promises to pay and had failed to pay.
[69]
Although Mr Moosa alleged that he made numerous requests to Liberty
to open the code, he failed to specify to whom and how
these requests
were made. Had he been bona fide in his attempts to meet his
repayments as undertaken and was being frustrated by
Liberty, it is
highly improbable that he would not have told Mr Ebersohn that he was
experiencing difficulty in submitting new
business or that he would
have remained silent in anticipation of a confirmation or refusal
from Liberty’s head office, especially
when Mr Ebersohn was
vigorously pursuing him to elicit compliance with his repayment
obligations.
[70]
And therein lies the rub! And the motive for Mr Moosa’s
denial that Mr Ebersohn communicated with him regularly
both before
and after the agreement was signed by him. Had he admitted that Mr
Ebersohn was in regular communication with him,
Mr Moosa would not
have been able to explain or justify his failure to inform Mr
Ebersohn of the problems he allegedly experienced
in submitting new
business and to confront him about the suspended code. Nor would Mr
Moosa have been able to rely on his version
that Mr Ebersohn advised
him that he had to await communication of acceptance from head
office, because when Mr Ebersohn asked
him to comply with the
agreement, he could have placed his obligation to comply in dispute
by responding that he was awaiting confirmation
of acceptance by
Liberty.
[71]
Under cross-examination Mr Ebersohn was referred to an email dated 14
August 2008, from Gerings, Liberty’s attorneys
and asked why Mr
Moosa would sign another acknowledgment of debt if one was already in
place. In the aforesaid email, Gerings advised
Liberty that Mr Moosa
had proposed settlement on the basis that he registered a mortgage
bond over his immovable property as collateral
security, paid monthly
instalments of R10 000, and :
‘
3.
He(Mr Moosa) would like Liberty to re-open his contract for
submitting new business, whereby commission earned on such new
business
could be controlled by Liberty either by means of a
retention agreement or crediting commission against the debt on an as
an(d)
when basis;
4.
He can then look at also increasing the amount being paid back to
Liberty if he is in a position to submit such new business;
5.
In the event that he defaults then Liberty would have the aforesaid
security against his property and could proceed to exercise
its
rights to call up such security;
6.
If he sells (t)he said immovable property then he would have to
arrange for the necessary financial guarantees/undertakings to
be
produced prior to Liberty agreeing to uplift such security.
7.
He would be prepared to sign an acknowledgement of debt to regulate
the above arrangement’.
[72]
This email records the
further
(my emphasis) settlement proposals
[9]
from Mr Moosa, after Liberty terminated the defendants’
commission code when he defaulted with payment in terms of the
agreement.
There was clearly no complaint by Mr Moosa about the
obstructions to his submission of new business or the failure of
Liberty to
confirm that it had accepted his settlement proposals as
recorded in the agreement. Nor did he inform the attorney that his
business
was being poached or query why no commission was generated
from existing business. To the contrary, he made further settlement
proposals and offered to furnish security, and indicated that he
would sign an acknowledgement of debt ‘
to
regulate
the
above arrangement’
(my emphasis).
[73]
Having considered the conspectus of evidence, I am satisfied that on
a balance of probabilities the evidence of Mr Ebersohn
is to be
preferred to the version offered by Mr Moosa. Mr Ebersohn’s
evidence is corroborated by the correspondence I have
already
referred to. Further Ms Muldoon testified undisputed that Mr Moosa
only became aware of the status of the code after termination
and Mr
Hoosen did not report any problems with the code to Mr Ebersohn. In
comparison, the absence of a cogent and consistent explanation
of his
failure to pay his debt from Mr Moosa and his vague and contradictory
evidence about his communication with Liberty, and
Mr Ebersohn in
particular, undermine the credibility of his version. Mr Moosa has
also not explained what precluded him from contacting
Mr Hopkins, who
had engaged with him about the debt, or from making enquiries with
Liberty’s head office directly if he was
undermined and
frustrated by Mr Hoosen or unable to contact Mr Ebersohn. Despite
his allegation that he withdrew his offer
to Liberty, Mr Moosa did
not testify when and where he withdrew his ‘offer of
settlement’ and to whom his withdrawal
was communicated. Mr
Moosa’s proposal to Gerings is also inconsistent with his
allegation that he had withdrawn his offer
to Liberty as recorded in
the agreement.
[74]
I am consequently satisfied that, contrary to his assertions, Mr
Moosa did not inform Liberty at any time that he could not
submit new
business because he
did not
(my emphasis) submit new business
and therefore was not aware that the code may not have been open.
[75] I am also satisfied
that Mr Moosa did not await confirmation from Liberty but considered
himself bound by the terms of the
agreement which he had negotiated,
because he repeatedly promised to pay and did not raise any objection
to the validity or implementation
of the agreement by Liberty when Mr
Ebersohn confronted him with his failure to pay, nor did he remind Mr
Ebersohn that he was
waiting for confirmation from Liberty. Similarly
he did not mention any of his alleged difficulties or reservations to
Gerings.
It was only when Liberty instituted the action against the
defendants that Mr Moosa opportunistically grasped at his proffered
defence of the invalid contract, alternatively the closed code, to
avoid paying the debt he admitted he owed to Liberty.
The
Nature and Validity of the Agreement
[76]
The appropriate starting point in the determination of whether the
agreement is an acknowledgement of debt which does not require
the
signature of the plaintiff as creditor as contended by Liberty, or
whether it is a settlement agreement which requires the
signature of
both parties and is therefore invalid and unenforceable against the
defendants because Liberty did not sign the agreement
as contended by
the defendants, is the current approach to interpretation of
contracts.
[77]
In
North
East Finance (Pty) Ltd v Standard Bank of South Africa Ltd
[10]
Lewis JA stated:
‘
[24]
…The court asked to construe a contract must ascertain what
the parties intended their contract to mean. That requires
a
consideration of the words used by them and the contract as a whole,
and, whether or not there is any possible ambiguity in their
meaning,
the court must consider the factual matrix (or context) in which the
contract was concluded. …
[25]
In addition, a contract must be interpreted so as to give it a
commercially sensible meaning:…’
[78]
In
Bothma-Batho
Transport (Edms) Bpk v S Bothma & Seun Transport (Edms) Bpk
[11]
Wallis JA stated:
‘
Whilst
the starting point remains the words of the document, which are the
only relevant medium through which the parties have expressed
their
contractual intentions, the process of interpretation does not stop
at a perceived literal meaning of those words, but considers
them in
the light of all relevant and admissible context, including the
circumstances in which the document came into being. The
former
distinction between permissible background and surrounding
circumstances, never very clear, has fallen away. Interpretation
is
no longer a process that occurs in stages but is
“essentially one unitary exercise”. Accordingly it
is no
longer helpful to refer to the earlier approach.’
[79]
The factual matrix and ‘relevant and admissible context,
including the circumstances in which the document (the agreement)
came into being, have already been set out in detail.
[80] In my view, the
context in which the agreement was prepared indicates that the
parties had intended that the agreement record
the nature and extent
of the debt as already agreed, and the acknowledgement by the
defendants of their indebtedness to Liberty,
which it does. Clause 2
of the agreement reads:
‘
2.
Acknowledgement of Debt
The
Debtor acknowledges that he is indebted to the Creditor in the amount
of R700 000.00 (Seven Hundred Thousand rand only),
(referred to
as “the debt”), which is advanced commission for policies
canvassed by the Debtor, which policies have
since were lapsed,
cancelled, reduced or terminated within the period mentioned in the
Agency agreement and the Schedule of Commission.’
[81]
Therefore despite the nomenclature ‘‘Deed of Settlement’,
Shaazura unequivocally acknowledged its lawful
indebtedness to
Liberty in the agreement, as pleaded in paragraph 4 of the
particulars of claim. The remaining material terms of
the agreement
relate inter alia to the repayment of the debt, interest, costs,
non-variation of the agreement.
[82]
Consequently the only ‘commercially sensible meaning’ I
am able to ascribe to the agreement, is that it was intended
to be an
acknowledgement of debt which incorporated the other terms agreed on
by the parties. I am fortified in my conclusion by
the evidence of Mr
Ebersohn that Liberty assisted brokers to liquidate their
indebtedness to it by negotiating an agreement in
terms of which the
broker would sign an acknowledgment of debt and undertake to settle
his liability by generating new business
and paying off the debt
through the commission earned. As only a debtor has to acknowledge
his indebtedness and confirm his undertaking
to pay, the signature of
the creditor is not essential to create a valid and binding
agreement, even if the agreement contains
an undertaking to pay.
[83]
This precept may be demonstrated as follows: a loan agreement in
terms of which a creditor loans and advances money to a debtor
is
signed by both parties, because it imposes obligations and entails
performance by both parties. But when the debtor furnishes
security
for the loan by registering a mortgage bond, the bond documents are
signed only by the debtor and are binding on and enforceable
against
him. The debtor acknowledges his indebtedness to the creditor and the
extent thereof in the mortgage bond, which also records
the rate of
interest, the terms of repayment, consequences of breach by the
debtor etc. Were the creditor to sue on the bond, no
objection would
be raised that he is relying only on portions of the mortgage bond,
or that he is alleging that the acknowledgment
of debt portion in the
bond is severable from the provisions for payment, because only the
debtor signed and executed the bond.
[84] I
am therefore unable to find merit in the reliance by the defendants
on
Kotzé
v Suid-Westelike Transvaalse Landbou Koöperasie
[12]
to sustain the argument that by alleging that the agreement is an
acknowledgement of debt, Liberty is attempting to rely on a portion
of the agreement which is not severable from the whole, and therefore
requires the acceptance by and signature of Liberty as creditor.
The
argument is also contrary to the view expressed in
T.W.
Lyne & Co v Benjamin Orchard
[13]
where the plaintiff, who held a note recording an acknowledgment of
debt and a promise from the debtor to pay in monthly instalments,
submitted that
he
had sued on the acknowledgment of debt, and not on the promise to pay
and
sought
provisional judgment for the sum on the acknowledgement of debt
.
The court
noted
that there was an acknowledgment of a debt and an offer to pay, but
there was no evidence that the offer had been accepted.
However as
the plaintiff proceeded on the acknowledgment of debt, and not on the
promise to pay, the court granted judgment for
the full debt.
[85]
Although Liberty relies on the written agreement, a question that
arises is whether it was a condition precedent that the acceptance
of
the terms agreed verbally would not be effective unless embodied in a
written agreement to be signed by the parties? There
is no
evidence of such a condition. To the contrary, although Mr Moosa
alleged that by signing the agreement he had made an offer
to
Liberty, he nevertheless agreed, and it was never disputed, that the
parties were
ad idem
and had reached
consensus
on the
material terms as recorded in the agreement. As already noted, no
dispute was raised with Liberty about the failure to confirm
its
acceptance when Mr Moosa made numerous promises to pay or even when
he agreed to sign a further acknowledgement of debt. On
the other
hand Liberty proceeded to open the loan account and implement the
terms of the agreement. It may safely be concluded
from the conduct
of the parties that the written agreement embodied the terms of the
verbal agreement which the parties intended
to be binding.
[86]
In
De
Bruin v Brink
[14]
Blaine J explained:
‘
An
agreement to confirm in writing the written terms of a contract
implies that what was arranged prior thereto was merely introductory
and provisional, and of no binding force: and on that account
furnishes very strong evidence of intention that the writings
containing
the terms and the confirmation should alone form the
contract. But no such implication would, I think, arise merely from
an agreement
to embody in a written document terms which had been
previously verbally arranged, as such an undertaking would be quite
consistent
with an intention to be bound by the verbal agreement,
while a condition requiring confirmation in writing of written terms
would
not.'
[87]
Innes CJ in
Woods
v Walters
[15]
stated:
‘
The
parties may of course agree that their contract shall not be binding
until reduced to writing and signed, and if they so agree
there will
be no
vinculum
between
them until that has been done. But the mention of a written document
during the negotiations will be assumed to have been
made with a view
to convenience of record and facility of proof of the verbal
agreement come to, unless it is clear that the parties
meant that the
writing should constitute the contract…It follows of course
that where the parties are shown to have been
ad
idem
as to the material conditions of the contract, the onus of proving an
agreement that legal validity should be postponed until the
due
execution of a written document, lies upon the party who alleges it.’
[88] Consequently the
argument that the process of signing a written bipartite contract
where the first party to sign makes an offer
and the other by his
signature accepts, is applicable to the agreement and that the
vinculum iuris
would have only been created when Liberty
signed the agreement, does not find favour with me. Further, the
evinced intention of
the parties to be bound by the verbally agreed
terms, together with the absence of proof by Mr Moosa that Shaazura
withdrew its
offer, is fatal to the defendants’ plea that
Shaazura had merely made an offer to Liberty by signing the
agreement, which
offer was withdrawn when Liberty did not sign the
agreement.
[89] In the premises, I
am satisfied that Liberty has discharged its
onus
and
established its cause of action in proving that the agreement is a
valid and binding agreement, of which the defendants are
in breach.
Mora
Creditoris
[90]
When the non-performance or the failure by a debtor in performing his
contractual obligations timeously is attributable to
the creditor,
the creditor is held to be in mora. The essence of
mora
creditoris
is the creditor’s failure to co-operate with the debtor to the
extent necessary to enable the debtor to perform. However
the debtor
must tender performance and there can be no breach of contract by
mora
creditoris
before any demand for co-operation from the creditor has been made by
the debtor.
[16]
The onus lies
on the debtor to establish that the creditor failed to co-operate,
despite demand, which prevented or delayed his
due performance.
[91] In the light of my
finding that Mr Moosa did not submit new business or inform Liberty
that the code was closed or request
Liberty to open the code, it must
follow that the defendants have failed to discharge the onus on them
to prove, on a balance of
probabilities, that their failure to comply
with their obligations under the agreement was attributable to
Liberty, who made their
performance impossible by not allowing Mr
Moosa to submit new business proposals, and their defence of
mora
creditoris
must fail.
Costs
[92] There is no reason
why costs should not follow the results. In terms of clause 14 of the
agreement, the defendants agreed to
pay legal costs on the scale as
between attorney and own client. I have also considered the
submissions by Mr
Bezuidenhout
in respect of the costs of the
adjournment reserved on 12 February 2012, and am of the view that the
reserved costs should be costs
in the cause.
Order
[93]
The following order do issue:
Judgment
is granted against the defendants, jointly and severally, the one
paying the other to be absolved, for:
1.
Payment in the sum of R838 024.43.
2.
Interest thereon calculated at 2% above the prime interest rate
prevailing from time to time, calculated from 20 August 2009
to date
of final payment.
3. Costs of suit on an
attorney and own client scale.
_______________
MOODLEY
J
APPEARANCES
Date
of Hearing:
12-14 November 2014
Date
of Judgment:
September 2016
Counsel
for the plaintiff:
Adv J Steyn
Instructed
by:
Gerings Attorneys
c/o Botha & Olivier
Attorneys
239 Peter Kerchoff Street
Pietermaritzburg
Ref Mr Olivier SH/pm/G.47
Telephone : 033 342
7190
Counsel
for the second defendant:
Adv
PC Bezuidenhout SC
Instructed
by:
Carlos Miranda Attorneys
273 Prince Alfred Street
Pietermaritzburg
Ref S0607/mm
Telephone: 033 345
7450
[1]
Exhibit C: letter
from Manci Knoop Financial Services to the defendants’
attorneys.
[2]
As reflected on
page 1 of the Deed of Settlement (annexure A to the particulars of
claim).
[3]
Annexure
A to the particulars of claim, pages 16 -20.
[4]
Exhibit
A
pages 34-35.
[5]
This test was first formulated in
these terms by De Villiers JP in
Gascoyne
v Paul and Hunter
1917 TPD
170
at 173, and was approved by the Appellate Division/Supreme Court
of Appeal in
R v Shein
1925 AD 6
at 9. See also
Claude
Neon Lights (SA) Ltd v Daniel
1976
(4) SA 403
(A) at 409G-H.
[6]
Paragraph 10.2.6
of the plea.
[7]
Paragraph 5 of the
defendants’ affidavit.
[8]
Statements : Exhibit A51 –
A100
[9]
Mr Moosa confirmed that he had made
settlement proposals when the agreement was negotiated with Mr
Ebersohn.
[10]
2013 (5) SA 1
(SCA) (footnotes omitted).
[11]
2014 (2) SA 494
(SCA) para 12.
[12]
2005 (2) SA 295
(SCA).
[13]
1872 NLR 2.
[14]
1925 OPD 68
at
73.
[15]
1921 AD 303
at 305-306. See also In
Goldblatt v Fremantle
1920 AD 123
at 128-9 where Innes CJ similarly held: 'Subject
to certain exceptions, mostly statutory, any contract may
be verbally
entered into; writing is not essential to
contractual validity. And if during negotiations mention is made of
a written document,
the Court will assume that the object was merely
to afford facility of proof of the verbal agreement, unless it is
clear that
the parties intended that the writing should embody the
contract. At the same time it is always open to parties to agree
that
their contract shall be a written one; and in that case there
will be no binding obligation until the terms have been reduced to
writing and signed. The question is in each case one of
construction.
’
(References
omitted).
[16]
R H Christie
The
Law of Contract
6 ed (2011) at
533;
Martin Harris & Seuns
OVS (Edms) Bpk v Qwa Qwa Regeringsdiens; Qwa Qwa Regeringsdiens v
Martin Harris & Seuns OVS (Edms)
Bpk
2000 (3) SA 339
(SCA) paras 17-19. See also
Government
of the Republic of South Africa v York Timbers (Ltd) (1)
[2001] 2 All SA 51
(A) para 60: ‘
Mora
creditoris
arises only
where the debtor’s performance requires the co-operation of
the creditor which it refuses, despite demand for
it.’