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[2014] ZAGPPHC 239
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Scenematic (Pty) Ltd v First National Bank, a division of First Rand Ltd and Another (26123/11) [2014] ZAGPPHC 239 (30 April 2014)
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REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG, PRETORIA)
Case
number 26123/11
In
the matter between:
SCENEMATIC
(PTY)
LTD
........................................................................
PLAINTIFF
and
FIRST
NATIONAL BANK, a division of
FIRST
RAND
LTD
.....................................................................
FIRST
DEFENDANT
THOMAS
JOHANNES NAUDÉ
...........................................
SECOND
DEFENDANT
JUDGMENT
HIEMSTRA AJ
[1] The plaintiff,
Scenematic (Pty) Ltd, is a manufacturing company. The first defendant
is First National Bank, a division of First
Rand Ltd, The plaintiff
held a bank account, No. 6[...], with the first defendant. The second
defendant is Mr Thomas Johannes Naudé,
a former director and
employee of the plaintiff.
THE ISSUE
[2] The second
defendant who was at the time an employee and director of the
plaintiff, personally entered into an instalment sale
agreement with
Wesbank, also a division of First Rand Ltd, for the purchase of a
Mitsubishi Pajero motor vehicle. He furnished
to Wesbank the bank
account number of the plaintiff, 6[...], for the purposes of payment
of the monthly instalments by debit order.
The agreement was entered
into on 22 May 2007. The debit order was honoured by the first
defendant and monthly instalments of R4
362.23 were debited to the
plaintiff’s bank account from 2 July 2007 to 1 February 2011,
in a total amount of R195 661.94.
[3] The plaintiff
alleges that the second defendant had no authority to cause the debit
order to be implemented against its bank
account. The second
defendant, on the other hand, alleges that the Managing Director of
the plaintiff, Mr W.C. Annandale, had agreed,
as part of the second
defendant’s remuneration package, that he could finance the
purchase of a motor vehicle and debit the
instalments to the
plaintiff’s account.
Claim
against the first defendant
[4] The plaintiff
alleges that the first defendant, as its banker, had undertaken
tacitly or impliedly that it would perform its
duties scrupulously
and without negligence. This undertaking included that the bank shall
not debit the bank account of the plaintiff
without proper authority.
[5] The plaintiff
claims that the first defendant had failed to comply with this
undertaking in that it had failed to take the necessary
steps to
ensure that the second defendant had the required authority to cause
the plaintiffs bank account to be debited with the
instalments in
terms of the second defendant's instalment sale agreement with
Wesbank. It further failed to exercise the necessary
care in carrying
out its duties in respect of the plaintiff’s bank account.
Claim
against the second defendant
[6] According to the
plaintiff, it had given the second defendant no authority to debit
its account and it had no knowledge of the
instalment sale agreement
between the second defendant and Wesbank. The plaintiff alleges that
the second defendant had acted fraudulently
by misrepresenting to
Wesbank that bank account number 6[...] was his personal bank account
number, or that the second defendant
had authority to furnish the
plaintiffs bank account number as the account against which the
monthly instalments were to be debited.
It claims that as a result of
the second defendant’s fraud, it had suffered damages in the
amount of the instalments debited
to its account.
[7] The plaintiff
accordingly claims against the first and second defendants jointly
and severally, the one paying, the other to
be absolved, payment of
the sum of R195 661.94.
PRESCRIPTION
[8] Both defendants
raised special pleas of prescription and argued that I should decide
the special pleas at the outset because,
if they were upheld, it
would be the end of the matter It is, however, clear from the
plaintiffs replication, filed belatedly with
the consent of the
defendants, that evidence was required to decide the special pleas,
and furthermore that the evidence regarding
prescription would be so
interwoven with the evidence on the merits, that all the evidence
should be presented. I accordingly made
such a ruling.
[9] The instalment
sale agreement was entered into on 22 May 2007 and the first
instalment was debited to the plaintiffs account
on 2 July 2007.
Summons was issued on 9 May 2011, nearly four years later. The debt
in question, if it exists, is one contemplated
by section 11(d) of
the Prescription Act 68 of 1969 (the Act). The subsection further
provides that such a claim is extinguished
by prescription after
three years.
[10] Section 12(1) -
(3) of the Act provides:
“
(1)
Subject to the provisions of subsections (2), (3) and (4),
prescription shall commence to run as soon as the debt is due.”
(2) If the debtor
wilfully prevents the creditor from coming to know of the existence
of the debt, prescription shall not commence
to run until the
creditor becomes aware of the existence of the debt.
(3) A debt shall not
be deemed to be due until the creditor has knowledge of the identity
of the debtor and of the facts from which
the debt arises: Provided
that a creditor shall be deemed to have such
knowledge if he
could have acquired it by exercising reasonable care.”
[11] The plaintiff
never became indebted to Wesbank in terms of the instalment sale
agreement. The agreement was entered into between
the second
defendant and Wesbank. The plaintiff's claim against the first
defendant is for for damages arising from negligence
or breach of
contract. The claim against the second defendant is for damages
arising from fraud. The plaintiff, on its version,
suffered damages
each time its bank account was unlawfully debited. Prescription can
therefore at the earliest run from the date
of each debit.
[12] In terms of s
12(3), a debt is deemed to be due once the creditor has knowledge of
the identity of the debtor and of the facts
from which the debt
arises. In terms of the proviso to the subsection a creditor shall be
deemed to have such knowledge when he
could have acquired it by
exercising reasonable care. When that moment arrives is a factual
question to be determined in the context
of the circumstances.
[13] The plaintiffs
account was debited for the first time on 2 June 2007and the debit
was reflected on its bank statement for the
relevant period and in
subsequent bank statements. Had the plaintiff thoroughly investigated
the debit each time it was reflected
in its bank statement, it would
have established the identity of the person who unlawfully caused its
bank account to be debited
and all the facts that were necessary to
institute action. In that event the plaintiff would have been able to
prevent any further
instalments to be debited.
[14] In terms of the
proviso to section 12(3) the question is whether plaintiff had
exercised reasonable care each time its bank
account reflected the
alleged unlawful debits.
[15] Mr Annandale,
the Managing Director of the plaintiff, testified that he does not
personally scrutinise the bank statements.
That is the duty of the
bookkeeper. He said that the company had been in a growth phase at
the time and that he had entered into
many instalment sale agreements
with Wesbank and other credit providers during that time for the
purchase of machinery. He said
that debit orders to the tune of
approximately R150 000 per month were debited to the plaintiff's
account. A debit order for R4
362.23 would not necessarily have
raised the interest or alarm of the accounting staff. They would have
assumed that it was for
the purchase of machinery. The first time it
was brought to his attention was during or about August or September
2008 when the
auditors requested the source documents for all debit
orders. He said that the source documents in respect of this debit
order
could not be found. He said that the auditor, Mr van Dyk,
suggested that Mr Annandale or his staff enquire from Wesbank about
the
debit order. He said that his daughter, Ms Candice Annandale, who
was employed by the plaintiff, had requested the information from
Wesbank, but that Wesbank had failed to respond. Ms Annandale
testified and confirmed this. Mr Annandale said that Mr van Dyk had
told him that it was not crucial since it was a relatively small
amount and that he was prepared to sign off the annual financial
statements without having had sight of the documents. Mr van Dyk
testified and confirmed this evidence. This was the situation
each
year until March 2011 when Wesbank eventually furnished the lease
agreement.
[16] Should I find
that the plaintiff had failed to exercise reasonable care each time
its bank account had been debited, then prescription
would run from
the date of each debit. Should I, on the other hand, find that the
plaintiff had exercised reasonable care in the
circumstances,
prescription would only run from such later date upon which the
plaintiff’s continued failure to investigate
the matter had
become unreasonable.
[17] I find Mr
Allandale’s explanation for the failure of his staff to
establish the origin of the debits as soon as they
were reflected on
the bank statements plausible, in the context of the huge amounts
debited to the account monthly, these debits
were relatively
insignificant. Although the plaintiff’s staff may not be
entirely blameless, ! cannot find that their failure
to investigate
the debits was so unreasonable that it can be said that the plaintiff
had not exercised reasonable care.
[18] I am, however,
not impressed with the explanations of Mr Annandale and Ms Annandale
for the plaintiffs failure to find the
cause of the debits when the
auditor requested them to find the source documents. The efforts of
Ms Annandale to establish from
Wesbank the origin of the debits were
half-hearted to say the least. However, that is irrelevant. The
auditor requested the documents
during August or September 2008. That
is the date from which prescription ran. That is less than three
years before summons was
issued,
[19] I therefore
find that the plaintiffs claims have not prescribed.
THE PLEADINGS
[20] I have already
set out the nature of plaintiffs claim against the two defendants.
The first defendant’s defence as set
out in its plea amounts
thereto that the plaintiff had “caused and authorised" the
second defendant, in his capacity
as a director of the plaintiff, to
enter into the instalment sale agreement, and had undertaken to pay
the monthly instalments.
[21] The first
defendant pleaded in the alternative that the plaintiff had supplied
to the first defendant various documents in
order for the first
defendant to be appraised of the plaintiffs financial position. It
also furnished a list of all the plaintiffs
directors and notified
the first defendant that the second defendant was one of its
authorised directors. It thereby represented
to the first defendant
that the second defendant had been authorised to act on its behalf.
The first defendant relied upon the
plaintiffs representation and
accordingly agreed to grant financial assistance to the plaintiff and
to the second defendant for
the purchase of the motor vehicle. As a
result of the plaintiffs failure to notify the first defendant that
the second defendant
had no authority to bind the plaintiff to such
an agreement, the first defendant acted to its detriment by entering
into the instalment
sale agreement. The plaintiff is accordingly
estopped from relying on the true state of affairs.
[22] The second
defendant pleaded that he, as a director of the plaintiff, had full
signing powers relating to the plaintiff’s
bank account, and
that he and Mr Annandale had colcuded a "Director's remuneration
agreement” in terms whereof the plaintiff
agreed to finance the
purchase of the particular Mitshibushe Pajero.
THE EVIDENCE
[23] It is common
cause that the second defendant had entered into an instalment sale
agreement with Wesbank on 22 May 2007 in his
own name for the
purchase of a Mitsubishi Pajero motor vehicle. The instalment sale
agreement initially reflected, in typescript
the second defendant’s
bank account number with the plaintiff, but that number was deleted
and the bank account number of
the plaintiff was inserted in
manuscript. The amendment was initialled by only the second
defendant. The second defendant declared
in the agreement, under the
heading "ERKENNINGS" the following:
"DEBIETORER
ek magtig hiermee onherroepelik dat
my
bankrekening
gedebiteer mag wordmet alle bedrae wat verskuidig is of te eniger tyd
in die toekoms verskuldig mag word ten opsigte
van my verpiigttng
kragtes hierdie ooreenkoms."(my emphasis)
He thereby clearly
represented to Wesbank that the number indicated was his own bank
account number
[24] On 24 May 2007,
the second defendant, presumably at the instance of the Wesbank ,
requested Ms Annandale to prepare a document
confirming his
employment status and his salary. She said that she had confirmed
with her father the second defendant’s correct
income,
whereafter she prepared such a document.
[25] The second
defendant testified that at some stage Mr Annandale had offered him
on two occasions motor vehicles, both Mercedes
Benzes. He declined
the offers because the vehicles did not suit his needs. Mr Annandale
then told him to “source”
a vehicle that suited him. He
said that Mr Annandale had insisted that the vehicle be registered in
his own name. He then purchased
the Mitshubishi Pajero in his own n
ame, and caused the instalments to be debited to the account of the
plaintiff.
[26] Mr Annandale
emphatically disputed the second defendant's evidence. He testified
that the second defendant had been dismissed
on unrelated
disciplinary charges during November 2008. It is common cause that
the instalments continued to be debited to the
plaintiffs account
long after the second defendant’s dismissal. This, according to
Mr Annandale, shows conclusively that
the motor vehicle could not
have been part of the second defendant’s director’s
remuneration.
THE LEGAL ISSUES
In
respect of the first defendant
[27]
The plaintiff claims for pure economic loss, namefy damages not
arisng directly from damage to its property, but rather in
consequence of a negligent act on the part of the first defendant.
Conduct causing pure economic loss would only be regarded as
wrongful
if public or legal policy considerations require that such conduct,
if negligent, should attract legal liability for the
resulting
damages.
1
[28]
It was held repeatedly that a bank generally owes their cousomers a
duty of care in respect of their bank accounts. It must
exercise its
duties scrupulously and without negligence.
2
In deciding whether the bank has adheared to its duty of care, is a
value judgment embracing all the relevant facts and considerations
of
public policy.
3
[29] In concluding
the instalment sale agreement, Wesbank was represented by an
employee, Ms Vanessa Downing. She was not available
to testify.
Council for the plaintiff accepted that she could not be traced and
did not submit that a negative inference should
be drawn from the
failure to call her. It is however, common cause that the second
defendant contracted in his own name and furnished
his own financial
information for the purposes of approval of the credit. Ms Downing
completed a “Corporate Spif Transmissions
Checklist” in
which she ticked a block indicating "Agreement signed by
authorised signatory and resolution attached”.
There is no
resolution attached and it is common cause that none existed. It is
also common cause that she had done nothing to
verify the second
defendant's bank details, or whether he had authority to cause the
plaintiffs bank account to be debited.
[30]
As I have s
aid
supra
,
whether the bank has failed in its duty of care is a value judgment,
in my view, Ms Downing’s omission was negligent. Her
negligence
is compounded by the fact that the second defendant had changed the
account number that he had first given to that of
the first
defendant. This should have caused her to enquire as to whose bank
account number the second defendant had supplied.
If she knew from
previous dealings with the plaintiff or the second defendant, or had
been told that it was that of the plaintiffs
account number, she
should have established whether he had the necessary authority. The
fact that the second defendant had signing
powers in respect of the
plaintiffs bank account does not mean that he had authority to burden
the plaintiffs bank account with
his personal liabilities.
In
respect of the second defendant
[31] I have no
hesitation in rejecting the evidence of the second defendant where it
is in conflict with that of Mr Annandale. He
was an evasive witness
who continuously adapted his version under cross-examination. Apart
from the fact that I find him to be
a dishonest witness, his evidence
that the alleged motor vehicle benefit had been part of his
remuneration is completely discredited
by the fact that the
instalments continued to be debited to the plaintiffs account long
after the termination of his services.
His explanation that he had
had a loan account to his credit and that he thought that the
instalments would be debited to his loan
account was another
invention conjured up during cross-examination.
[32]
I
find
that the second defendant had acted fraudulently and had caused the
plaintiff to suffer damages in the amount of the Instalments
debited
to its bank account.
In the result 1 make
the following order:
1. Both defendants’
special pleas are dismissed with costs;
2. The first and
second defendants are ordered to pay to the plaintiff the amount of
R195 661.94 jointly and severally, the one
paying, the other to be
absolved.
3. The first and
second defendants are to pay the plaintiffs costs, the one paying,
the other to be absolved.
J.
HIEMSTRA
ACTING
JUDGE OF THE HIGH COURT
Date heard: 7 March
2014
Date of judgment: 30
April 2014
Counsel for the
plaintiff: Adv M.M.W. van Zyl SC
Attorney for the
plaintiff:Dawie Beyers Attorneys Inc
110 Nicolson Street
Brooklyn
Pretoria
Tel: 012 346 7270
Fax: 012 346 7260
Ref: JD
/Beyers/BD3282/bh
Counsel for 1
st
defendant: Adv GH Meyer
Attorney for 1
st
defendant: Rossouws Lesie Inc
c/o R. Swaal
Attprmeus
1244 Woodlands
Drive
Queenswood
Pretoria
Tel: 012 333 3540
Fax: 012 333 3543
Ref: Mr
Swaak/MAT6469
Counsel
for
2
nd
defendant:
Adv D. Keet
Attorney for 2
nd
defendant: AJ van Rensburg Inc
c/o RC Christie
Attorneys
Room 503, 5
th
Floor
Standard Bank
Building
Church Square
Pretoria
Tel: 012 328 5628
Fax: 012 328 5644
Ref: RC
ChnstieA/1151
1
MV
MSC Spain; Mediterranean Shipping Co (Pty) Ltd v Tehe Trading (Pty)
Ltd
2005
(5) SA 514
2
(SCA
at 520G - 522F;
Peterson
& Another v Absa Sank Ltd
2011
(5} SA 489
(GNP) at para [3]
z
Indac Electronics
(Pty)Ltd v Voikskas Bank Ltd
1992
(1) SA 733 (A)
3
"
Indac Electronics
supra
3t797 E-F