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[2016] ZAGPPHC 568
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Swift Human Resources v Hamba Fishare Build (Pty)Ltd and Another (26343.2014) [2016] ZAGPPHC 568 (17 May 2016)
IN
THE HIGH COURT OF SOUTH
AFRICA
(GAUTENG D
I
VISION,
PRETORIA)
Case
number:26243/2014
Date: 17 May 2016
Not Reportable
No interest to
other Judges
Revised
In
the matter between:
SWIFT
HUMAN
RESOURCES
CC
PLAINTIFF
And
HAMBA
FISHARE
BUILD
(PTY)
LTD
FIRST
DEFENDANT
FRANCOIS KOTZE
SECOND
DEFENDANT
FRANCOIS COLIN KOTZE
THIRD
DEFENDANT
JUDGMENT
PRETORIUS J ,
(1)
In
this
action
the
plaintiff
claims
from
the
second
and
third
defendants payment of an amount
of
R1 365
489.71 together with
interest
and costs,
jointly and
severally. The
first
defendant
has
finally
been
deregistered
and
is no longer
a
party to the
action.
(2) The
claim
is
based
upon
a
written
acknowledgement of
debt
("AOD") executed
by
the
defendants
on
21
April
2011
in favour
of
the
plaintiff.
Due to
the
fact
that
the
parties
agreed
on
a
number
of
common
cause facts
the
only
remaining
issues
the
court
has
to
decide
is whether
the
defendants' indebtedness had
been
settled
by
Basil
Read
by
virtue
of payment
received
pursuant to
a
cession
of
book
debts
agreement entered into
on
30
May
2011
and
that
the
plaintiff received payment due to
it
by defendants,
directly from
Basil Read. The defendants abandoned
the
defence
in
respect
of the
National
Credit Act.
(3)
On
1 February
2011
the third
defendant,
as director
of
the first
defendant, and the plaintiff concluded
two agreements.
The first
agreement
was
for
the
hiring
of
temporary
employment
services
and
the second
for
the
provision
of
credit
by the
plaintiff
to the first
defendant.
The
third
defendant
signed
as
surety
in
both
the
abovementioned agreements.
The
salient
terms
of
the
agreement
between the
plaintiff and defendants were that the
plaintiff
would
provide the
defendants
with temporary employees to work at a construction
site
for
Basil
Read
at
the
Groot
Geluk
Mine. The employees provided by
the plaintiff
to
the
first
defendant were to
be used
by
the
first
defendant
to
fulfil
its
obligations
in terms
of
the
Basil
Read contract.
The
plaintiff
complied
with
its
obligations,
but the
defendants could
not
comply due
to
Basil
Read
not
paying
the defendants
for
construction
work
done
at
Groot
Geluk
Mine.
(4)
Mr
Odendaal testified on behalf
of
the
plaintiff
that he
was
the
area manager in
2011.
The company supplied temporary workers to
the first
defendant
at
the
request of
the
defendants.
The
company was thus
a
labour
broker
at the time.
The
temporary
workers
were
supplied
and
then
an
invoice
was
sent
every
thirty
(30)
days
to
the
client,
which
had to
be
paid by the
client.
The witness
for
the
plaintiff,
Mr Odendaal, conceded
that
he
was not
present
when
these
two
agreements
were entered
into
between
the
plaintiff
and the
defendants.
(5)
There
was
no
contract
to
supply
contract
workers
between
the
plaintiff and
Basil
Read Construction.
It
is common
cause that the
construction contract
that
the
defendants
had with
Basil
Read was
in
the
amount
of R25
million,
as
both
the witness
for
the
plaintiff
and the
defendants
had testified.
(6)
The
defendants
needed
the
credit
facility
from
the
plaintiff
to
enable
them
to
perform
in
accordance
with
the
obligations
they
had
to
Basil
Read
at the
Groot
Geluk
Mine.
Both the
plaintiff
and the
defendants
testified that they had at all times been aware of the Basil Read
contract.
(7)
If
regard
is
had
to
the
correspondence
between
the
plaintiff
and
the
defendant
it
is
clear that the
defendants
would
only
be able to
pay
in
accordance
with
the
agreements
once
Basil
Read
had
paid
the
plaintiff.
Mr
Odendaal's
evidence
in
this
regard
is
that
the
plaintiff
failed to institute
action against the defendants in
terms
of clause 16 of
the hiring of temporary
services
agreement.
The reason, according to
him, being
that he
trusted
Basil Read
to
perform in
terms of
the
contract.
(8)
The
first credit facility
granted
to the first defendant
by the
plaintiff was
in an amount of R250 000, which was
increased to RSOO 000.
As
the
plaintiff threatened
not
to
pay the workers
as the
defendants
failed
to
pay
the
plaintiff,
due
to
Basil
Read
not
paying
the
defendants,
the
plaintiff and defendants signed an AOD on 21 April 2011.
According to
the AOD the
defendants
undertook to
pay the
claim
amount
before or
on
31 May 2011. On 30 May 2011 the parties and Basil Read
concluded
a
cession agreement,
before the
AOD was
due on 31
May
2011 at 12h00.
(9)
Mr
Odendaal
represented
the
plaintiff
at
the
conclusion
of
this
agreement.
His
evidence
was
that
the
cession
was
concluded
as
a
result
of
the
defendants'
failure
and
or
inability
to
pay
the
plaintiff
as agreed
in
the AOD.
His
evidence was that when the cession was concluded
Basil
Read
had
not
paid
the
defendants,
who
in
their
turn was
unable
to
pay the
plaintiff for
services
rendered.
(10)
Clause
2
of the
Cession
of
Book
Debts provides:
"The
Company
hereby
cedes,
assigns
and
transfers
unto
and
in favour
of
the
Creditor
all
of
the
Company's
right,
title
and interest
in
and
to
the
book
debts
of
BASIL
READ
(together
with
all
rights
of
action
arising
thereunder)
present
and
future,
due and
to become
due
to the
Company,
from whatsoever cause
of
debt
arising
and
by
whomsoever
owing."
(Court emphasis)
Clause 3 provides:
"This Cession shall
endure for so long
as
the
Company is
indebted to the Creditor from
any cause arising whatsoever."
(11)
Mr Odendaal
conceded
that
all
past debts
owed
by
Basil
Read to the
defendants
were
ceded
to the
plaintiff
in terms
of
the
cession,
which
included the debts
reflected in the AOD.
According
to
Mr Odendaal's
evidence a
quantity surveyor was employed by the plaintiff to ascertain
whether
Basil
Read still
owed
money
to
the
plaintiff.
The
reliance
by
the
plaintiff
on the quantity
surveyor's
finding
that
Basil Read was
not
indebted
to
the
first
defendant
in
any
amount
was
ill
conceived. It is
based
on
hearsay
evidence,
the
quantity
surveyor
was
not
called
to
give
evidence,
neither
was
his
report
provided
to the
defendants
and the
court.
Therefore
the
plaintiff
cannot
rely
on
this
report.
The
court
will
not deal with
his
report
as
it is not before court.
(12)
There can be no doubt that the
plaintiff was
at
all times
relying on the
terms
of the
cession as the letter from the plaintiff's attorney dated 27
June 2011 confirmed:
"Ek
bevestig my
instruksies
vanaf
my
klient Swift
Human
Resources
CC
om
u
hiermee
in
kennis
te stel
dat
u mandaat as
agent
namens
Swi"ft
vir
die
kollektering
van
enige
gelde
vanaf Basil Read in terme van
klousule
6
van
die
sessie
soos
geteken
is
op
30
1
05
1
2011
waarvan
'n
afskrif
hierby aangeheg
word
vir maklike
verwysing, gekanselleer word met
onmiddel/ike
effek.
U
sal
voortaan
nie
geregtig
wees
om
enige
gelde
vanaf
Basil
Read te vorder nie, maar word u versoek
om
u samewerking
te
verleen aan Swift Human Resources
CC
ten einde u, Hamba
se
vordering
teen
Basil
Read
effektief
deur
te
voer."
(Court
emphasis)
It
is
thus
clear
that
the
plaintiff
perfected
the
cession
agreement
and
collected the money owed to it by the first defendant
directly from
Basil
Read.
(13)
In
other
words
the
defendants
were
forbidden
from
collecting
money
owed
to it
from
Basil Read in
terms of
the cession.
The
plaintiff
acknowledged this not only in the
agreement of cession, but confirmed it
in
this
letter.
The
plaintiff
was
thus
exercising its
rights
in
terms
of clause
6
of the
cession.
The
result
thereof
is that
any
claims
which
the defendant
had or
may
have
had
against
Basil
Read,
had
prescribed.
(14)
The
question
thus
arises
whether
the
plaintiff
can
claim
form
the defendants in
these
circumstances where a
cession
exists.
In
South African law
cession
is
the
transfer of
personal
rights
flowing
from
the
book
debts. The
definition
of
book
debts
was
set
out
in
Glaum
NO v The
Master
[1]
as:
"...that
a
book
debt
is
a
debt
arising
in
the course
of
business
dealings
which
would
or
could,
in
the
ordinary
course
of
business, be
entered
in
the
ordinary
book of
accounts
of
a
business."
(15)
In
this
instance
it was
specifically
noted that
both
existing
and future
book debts were
ceded.
The effect
of an absolute
cession
is
that thecedent
is
divested
of
all
the
rights,
as
in this
instance,
to
collect
the
book
debts. In
Vivier
v
Waterberg
Ko-op
Landbou
Bpk
[2]
the
court
decided that as these
rights vest in the cessionary, only the cessionary
and
not
the
cedent is
entitled
to
sue
for
the
enforcement of
those
rights.
The
effect
of
the
cession
is the
ceded
rights
are
immediately
transferred to
the cessionary.
(16)
It
is
important
to
note
that
both
existing
and
future
book
debts
were
ceded,
as
stated
clearly
in clause
2
of the
cession.
This
cession
has a binding
effect
on
the
cedent
from
the
date
of
the
cession,
which
is
30 May
2011,
a day
before the AOD
became
due.
(17)
The cedent is
thus
divested of
all
the rights
ceded
and
these
rights now
vest
in
the
cessionary
and
only
the
cessionary is
entitled
to
sue
for the
money
owing from
Basil
Read.
(18)
The
cession
agreement
was
entered
into
on
30
May
2011, one
day
before the deadline
in
terms
of
the AOD.
There can be no
other interpretation
but that
the AOD was
replaced
by the
agreement
of cession
if
one
reads
the
cession
of
book
debts,
particularly
clauses
2
and
3 of the
cession
agreement.
Therefor
the
plaintiff
chose to
rely
on the
cession
and
not
the AOD.
Mr Odendaal's
evidence
was
that
the
cession
agreement
provided
that
all the
rights
ceded
to
claim
any
past
debts
owed
to
it
by
Basil
Read
and the
right
to
sue
Basil
Read
had
been
ceded. According to
Mr
Odendaal
this
included
the
amounts
contained
in
the
AOD. Clause
2
of the
cession
of
book
debts
made
it very
clear
that
it
included
"present
and future,
due
and
to become
due".
This was
confirmed
by the
letter
of
30
May
2011
forbidding
the
defendants
to
collect
any
money
owed
to
it
by
Basil
Read.
In
other
words
the
plaintiff
regarded
itself
as
the only
entity
entitled
to
receive
any
payment
from
Basil
Read
instead
of
the
defendants.
(20)
Counsel for the
plaintiffs'
argument
was
that
the
cession
merely
served
as
security
for
the
indebtedness
of
the
defendant
in terms
of
the AOD. That
cannot
be the
true
position
if
regard
is had to the
letter
of
30
May
2011.
It
is
clear
from
the
letter
that
the
plaintiff
regarded
itself
as
the
entity
to
claim
from
Basil
Read
and
neither
this
amount
not
the
AOD
was at
any
stage
excluded
from
the
cession.
The plaintiff
explicitly
precluded the
defendant
from
claiming
any
money
from
Basil
Read.
(21)
The
defendants'
case
is
that
they
are
not
indebted
to
the
plaintiff
as
Basil Read had
to pay
the
amount owing to the defendants to the
plaintiff
in terms
of
the
provisions
of the
cession.
(22)
According
to
the
plaintiff
the
main
defence
of
the
defendants
is
one
of
payment.
The
argument
is that the
defendants
have to
prove
payment
as
the
onus
is on them
to
prove
payment.
This
onus
of
payment
is
on
the
defendants
throughout
the
case. The
plaintiff
relies
on
the
finding
by Olivier JA in
Nedperm
Bank Ltd v Lavarack and Others
[3]
:
"From
these basic principles
of law it follows logically, in my view,
that where
there are two
obligations to
be
fulfilled
by
a
debtor,
he
bears
the
onus
of proving,
not
simply
that
a
payment
was
made, but also of proving the
necessary consensus regarding
which
debt
was
paid."
This is
confirmed by
the
principles set
out
in
ltaltile
Products (Pty) Ltd v
Touch
of Class
[4]
where
Viljoen
AJ found:
"Although
I
have
myself
also
not
found
authority
dealing
with
a
case
such
as
the present, where payment
is
admitted
but
there
is
a
dispute
regarding
the
debt
for
which
it
was
intended,
I
have no
doubt
that
the
onus
of
proving, not
only
that
payment
was
made, but that the
debt
in question was
paid, rests upon the debtor.
This is
in
accordance
with
the principle
that
it is
the party
making
a
positive
averment who bears the onus of
proof
Moreover,it
seems
to me that the very requirement that
a
debtor
should prove payment
of
a
debt, in itself
necessitates proof that the
debt
in question has
been
paid
and not simply that
a
payment
has
been
made
to
the creditor."
(
23)
According
to
the
plaintiff
the
defendants
had to
prove
which
amounts
were
owing and which
amounts
Basil Read had paid.
No
party called
a witness from
Basil Read. Both Mr Odendaal and Mr van der
Merwe,
attorney for the plaintiff, testified that
according to Basil Read no
amount was
outstanding
and
Basil
Read
was
not indebted to the first
respondent at
all.
(24) Mr Odendaal was
confronted with the fact that he had answered
under
oath
to
the
defendants' Rule
35(3)
notice
that
the
plaintiff
had
only
received one payment from
Basil
Read on 2 June 2011 in the amount of
R380
975.71.
This is
clearly
false
as
the
plaintiff had
received
a
total
amount of R1 204 662.02 between 4
August
2011 and 2 December
2011
as can
be
seen from the bank statements.
(25)
The
plaintiff's
counsel
argued
that
it was trial
by ambush
as
the
plaintiff could
not
investigate
the
payments
received
by
the
plaintiff
before trial. This
argument
cannot
be
entertained
as
true.
It
was
the
plaintiff
who
discovered the bank statements
which
clearly showed the four payments,
namely:
"On
04
1
0
8
1
2011: R 314 487.22
On 2310912011: R 334 249.65
On 0211212011: R 183 453.21
On 0810712011: R 372 471.94
TOTAL: R 1 204
662.02"
No further
particulars
in
this
regard
had been
requested
by the plaintiff.
(26)
Mr
Odendaal
testified
that only
the
financial
manager
of
the plaintiff could
testify
which
payment
related
to
certain
invoices.
The
court was informed
that
due
to
the
fact
that
the
financial manager
was
in
Cape Town,
he would
not
be called to
testify
on
behalf
of the
plaintiff.
Counsel
for
the
plaintiff
tried
to
rehabilitate
this
evidence by
Mr
Odendaal, during re-examination,
by
trying to marry
certain
invoices with payments. It
is
Mr
Odendaal's
evidence that only
the
financial
manager
would
be
able
to
do
this
and
Mr
Odendaal's
attempt
is
thus only that, an
attempt, and
not evidence the court can take into
consideration.
(27)
Although
the
invoices
were
printed
on
a
2013
heading
of
the
plaintiff,
relating to
2011,
I do
not
make any finding
in this
regard
and
I regard
it
as a neutral
fact.
The plaintiff did not
succeed
in
proving
that the payments were
not
allocated to the
claim
amount.
(28)
The
defendants
admitted
not
making
payments
as
they
relied
on
the cession
agreement.
In
this
instance
the
reliance
on
the
principles
in
Abraham v Cassiem
[5]
and
ltaltile
Products (Pty) Ltd
v
Touch of Class
[6]
is
not
applicable
as
the
defendants
rely
on the
cession
of
book
debts.
(29)
I
must
agree
with
defendants'
counsel
that
if
there
is
a
dispute
about
payments
and
its allocation
the
dispute will
be between the
plaintiff and Basil
Read.
The
further
lacuna
in
the
plaintiff's
case
is
that
the financial
manager
was not
called
to
explain
how
payments
from Basil Read were
allocated.
I
find
that
due
to
the
cession
of
book
debts
the
plaintiff
cannot
succeed
in
his claim.
(30)
I
must
agree
that
the
plaintiff
failed
to
sue
the
correct
party, namely Basil
Read,
as
the defendants
no longer had
the
right
to
sue Basil Read.
(31)
In
these
circumstances
the
claim
for
payment
cannot
succeed
and the
plaintiff
has failed
to
prove on
a
balance of
probabilities
that it
is entitled
to
payment
from
the
defendants.
(32)
Therefor
I make the following
order:
1.
The
plaintiff's
claim
is dismissed
with
costs.
Judge C PretoriuS
Case
number :
26243/2014
Matter
heard on :
16,
17 March 2016
and
21 April
2016
For the
Plaintiff: Adv
R
Grundlingh
Instructed
by Snyman
De
Jager
Inc.
For
the
Defendants:
Adv N Breytenbach
Instructed
by: Enslin & Fourie
Attorneys
Date of Judgment :
17 May 2016
[1]
1980(2) SA 600 C at 609 B-C
[2]
1956(1) SA 665 (T)
[3]
1996(4) SA 30 (A) at 47 A
[4]
1982(1) SA 288 (0) at 290
H
[5]
1920 CPD 568
[6]
Supra