About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2013
>>
[2013] ZAGPPHC 255
|
|
Govender and Another v Burden and Swart Attorneys (35418/2010) [2013] ZAGPPHC 255 (27 August 2013)
NOT
REPORTABLE
IN
THE NORTH GAUTENG HIGH COURT,
PRETORIA
(REPUBLIC OF SOUTH AFRICA)
Case
Number: 35418/2010
DATE:27/08/2013
In
the matter between:
LENNY
GOVENDER
...........................................................................................
FIRST
PLAINTIFF
MICHELLE
GOVENDER
...............................................................................
SECOND
PLAINTIFF
and
BURDEN
AND SWART
ATTORNEYS
......................................................................
DEFENDANT
JUDGMENT
MOLEFE.
J:
[1]
The Plaintiffs instituted an action against the Defendant, a firm of
attorneys, for a recovery of a loan made to the Defendant
on 2
September 2008 in the sum of
R600
000-00 of which an amount of R174 000-00 has been repaid, plus
interest at 5% per month, from date of the advance to date of
final
payment.
[2]
The Plaintiffs allege that they lent and advanced the sum of R600
000-00 to the Defendant in terms of a partly oral and partly
written
agreement. The Plaintiffs rely on a letter from the Defendant,
(Annexure “A” letter) to confirm the terms of
the
agreement. The terms of Annexure “A” reads as follows:
“
Aan:
Lenny en Michelle Govender
i/s:
Mascador/Max Return
Ons
bevestig dat ons die volgende voorskot \/erlang op bovermelde
transaksie:
1.
Die bedrag van R600 000-00;
2.
Voorgemeide voorskot bedrag sal teen ‘n administrasiefooi van
5% per maand (pro rata) van af voorskot tot datum van terugbetaling
geskied;
3.
Geide voorgeskiet sal terugbetaalbaar wees op datum van registrasie
van transport maar nie later dan ‘n periode van 4
maande vanaf
datum van die voorskot nie, waarop die administrasiefooi vir die 4
maande ten voile betaalbaar is;
4.
Indien toestemming verleen word tot verlenging van die voorskot sal
a I die toekomstige administrasiefooie maandeliks betaalbaar
wees.
5.
Ons gee u hiermeer ons firma-onderneming vir die terugbetaling van
voormelde bedrag aan u. [....]”
[3]
The Defendant denies that the loan agreement was entered into with it
and denies the veracity of Annexure "A”. The
Defendant
avers that on 2 September 2008, the loan agreement was entered into
between the Plaintiffs and the Defendant’s
Client Union Equity
& Trust (Pty) Ltd and/or Mascador 160 (Pty) Ltd duly represented
by Robert Linkmeyer and/or Leonora Swart.
Mrs Michelle Govender
[4]
The Second Plaintiff was the sole witness on behalf of the
Plaintiffs. Mrs Michelle Govender testified that she is married to
the First Plaintiff and was employed by the Defendant as a
conveyancing secretary during the period of May 2005 until December
2010. She and her husband were amongst several investors who over the
years during her employment with the Defendant, advanced
bridging
finance to the Defendant at an interest fee of 5%.
[5]
On 2 September 2008, Mrs Govender was approached by Mrs Leonora
Swart, a partner at the Defendant firm and requested her to
advance
between R800 000-00 to R1000 000-00 as bridging finance and that the
details of the loan would be given to her later. Mrs
Swart was
sitting with Mr Linkmeyer in her office when the request was made.
The next day, after Mrs Govender had discussed the
loan with her
husband, they effected payment of R600 000-00 into the Defendant’s
trust account. Mrs Govender received Annexure
“A” from
Mrs Swart’s secretary, Mrs Lizette Myburgh on 4 September 2008
after requesting same from Mrs Swart.
She trusted Mrs Swart and was
satisfied with the defendant’s undertaking to repay the monies,
in terms of Annexure “A”.
[6]
Annexure “A” was a standard letter used in bridging
finance matters and was initially only available in Afrikaans.
Later
during 2008 when Mrs Govender demanded repayment of the loan from Mrs
Swart, she referred her to Mr Linkmeyer and informed
her that she had
to recover the monies from him. Mrs Govender testified that she had
seen Mr Linkmeyer several times at the defendant’s
offices but
she had no personal relationship with him. She would not have
advanced monies to him or any of his companies as she
did not know
him and had no trust relationship with him. She never discussed
anything with Mr Linkmeyer regarding the loan and
has never
telephoned Mr Linkmeyer requesting the money. Mrs Govender testified
that, since 2007, she and her husband had made a
number of loans to
the defendant as bridging finance and the monies were always repaid.
The defendant made repayments to Mrs Govender
over a period of time
for a total amount of R174 000- 00, towards the R600 000-00 loan.
Mrs Leonora Swart
[7]
Three witnesses testified on behalf of the Defendant. Mrs Leonora
Swart testified that she is a partner at Burden and Swart
Attorneys
(the Defendant) and that the second plaintiff was her conveyancing
secretary. She testified that on the morning of the
2 September 2008,
Mr Linkmeyer came to her office and requested funds from the
defendant as he had a deadline to pay funds. He
required R600 000- 00
to fulfil the conditions and terms of a foreign investment agreement.
Mrs Swart requested the second plaintiff
to join her in her office
and whilst both of them were sitting down, Mr Linkmeyer explained to
the second plaintiff, who was standing
at the door of the office why
he needed the funds. The second plaintiff asked to speak to her
husband first. The plaintiffs transferred
R600 000-00 into the
Defendant’s trust account on 3 September 2008.
[8]
Mrs Swart did not explain to Mrs Govender that the loan was needed to
pay a non-refundable deposit to a seller or any of the
other risks of
the foreign investments. She could not even supply any information
about the contents of the agreements in the United
Kingdom where the
risk of non-payment lay. She however insisted that the R600 000-00
paid by the plaintiffs was a low-risk transaction,
despite the fact
that she had no knowledge of the risks in the United Kingdom. Mrs
Swart could not identify any written instructions
by Mr Linkmeyer on
behalf of any legal entity requesting the advance payment of monies
by the Plaintiffs to him or any legal entity.
She confirmed that an
amount of R174 000-00 was repaid to the plaintiffs over a period of
time.
[[9]
Mrs Swart testified that due to the recession, no further payments
came through and Mrs Govender constantly asked her for their
money.
Mrs Swart constantly told Mrs Govender to phone Mr Linkmeyer directly
to request her money and testified that she later
advised her to
litigate against Mr Linkmeyer.
[10]
.Mrs Swart denied that Annexure “A” was generated by her
for the plaintiffs and her reasons for this was that the
term
“administrasiefooi” was used instead of the usual
“interest” and further that the loan was not for
a
conveyancing transfer transaction.
Mr Robert Linkmeyer
[11]
Mr Robert Linkmeyer testified he was the defendant’s client.
His company Mascador 160 (Pty) Ltd changed its name to Union
Capita!
(Pty) Ltd, the holding company and that Union Equity & Trust
Ltd’s shares were held by Union Capital (Pty) Ltd.
These shares
were to be sold to investors, after they had made pledges and paid
monies into the defendant’s trust account.
Union Equity &
Trust Ltd was deregistered during 2012.
[12]
Mr Linkmeyer testified that on 2 or 3 September 2008, he went to the
defendant’s offices and had a discussion with Mrs
Swart about
his deadline for payment in terms of a written agreement signed on 9
July 2008. He conveyed to Mrs Swart that he had
secured R1 300 000-00
of the required R2 500 000-00 and needed bridging finance to cover
the shortfall.
[13]
Mrs Swart called Mrs Govender to her office and whilst Mrs Govender
was standing at the door, he (Mr Linkmeyer) asked Mrs Govender
for
the money. Mr Linkmeyer conceded that he did not have a personal or
trust relationship with Mrs Govender. He would normally
not make a
possible investor from whom he was asking for money stand at the
door.Mr Linkmeyer told Mrs Govender that he needed
R600 000-00 and
Mrs Govender responded that she had to speak to her husband first.
Mrs Govender paid the R600 000-00 into the Defendant’s
account.
Mr Linkmeyer testified that pledges came in very slowly and due to
the uncertainty in the mining sector, shareholders
were under
pressure. Monies did not come in due to unforeseen circumstances, and
he could not pay the plaintiffs the balance of
the loan. Mr Linkmeyer
never explained to Mrs Govender that the pledges were irrevocable.
[14]
According to Mr Linkmeyer, this was the only finance agreement which
was entered with Mrs Govender through the defendant. The
other
finance agreements were entered into directly with the investing
parties. Mr Linkmeyer testified that on 3 October 2008.
a meeting was
held with Mrs Govender and Mrs Swart and it was agreed, at that
meeting that the plaintiffs will stand back to allow
the loan of Mr
Adriaan Marais, Mr Linkmeyer’s investor to be repaid first
before the plaintiffs’ repayment. Mr Linkmeyer
testified that
when Mr Marais advanced the loan to him and/or Union Equity &
Trust Ltd, an undertaking was given to Mr Marais.
Ms Elizabeth Katarina Myburgh,
[15]
Ms Elizabeth Katarina Myburgh, testified that she was the defendant’s
senior conveyancing secretary for approximately
15 years and left the
defendant’s employment in February 2009. She testified that she
had a recollection of Mrs Govender
attending the office of Mrs Swart
when Mr Linkmeyer was there in 2008. She disputed that she issued
Annexure “A” to
Mrs Govender as the letter was not
written in her style, but conceded that the letter was almost
identical to the correspondence
drafted by her for bridging finance
transaction. Ms Myburgh further testified that some years later, she
was contacted by Mrs Govender
after she (Ms Myburgh) had left the
defendant’s employment, with the request to sign an undertaking
letter for her, but she
refused. Although she testified that she was
not involved in the Govender/Mascador matter, she confirmed that she
drafted the reconciliation
statements in the matter when payments
were made.
[16]
Having heard the testimony of the parties’ witnesses, it is my
view that this is a case of mutually destructive versions
and logic
dictates that the court will have to accept the one version and
reject the other.
[17]
The defendant’s counsel
1
relied on the National Employers Mutual General
Insurance
v Ganny case
2
wherein the following was stated:
“
Where
there are two stories mutually destructive, before the onus is
discharged, the court must be satisfied that the story of the
litigant upon whom the onus rests is true and the other (story)
false. It is not enough to say that the story told by Clark is
not
satisfactory in every respect. It must be clear to the court of first
instance that the version of the litigant upon whom the
onus still
rests is the true version and that in this case, absolute reliance
can be placed upon the story by A. Gany..
I
am entirely in agreement with the dictum in the National Employers
Mutual General Insurance case supra.
[18]
It is common cause that the defendant was running a bridging finance
transaction business within its attorney’s firm
in the
conveyancing department. Such monies were mostly advanced to the
seller(s) and the defendant’s employees including
the
plaintiffs, participated in these transactions as investors at an
interest rate of 5% per transaction. Standard undertaking
letters
were issued by the defendant to the people who advanced the money,
which letters were identical to Annexure “A".
[19]
The first issue to be determined by this Court in casu is whether Mr
Linkmeyer or Mrs Swart requested the loan from the second
plaintiff
at a meeting held between the second plaintiff and the defendant’s
Mrs Swart and the defendant’s client,
Mr Linkmeyer on 2
September 2008 in Mrs Swart’s office. The plaintiff’s
version is that Mrs Swart summoned her to her
office and requested an
advance of R800 000-00 to R1 000 000-00 as loan as the usual bridging
finance transaction. The defendant’s
witnesses version is that
the second plaintiff entered Mrs Swart’s office and whilst
standing at the door, discussions about
the loan took place between
her and Mr Linkmeyer.
[20]
The defendant’s version that a meeting was held with the second
plaintiff on 2 September 2008, where a loan of a substantial
amount
was sought from her by Mr Linkmeyer, is in my opinion, on a balance
of probabilities not true. The plaintiffs had a relationship
of trust
with the defendant and had conducted numerous bridging finance
transactions with the defendant. Mr Linkmeyer was the defendant’s
client but did not know the second plaintiff personally. Furthermore,
the second plaintiff did not have any relationship with Mr
Linkmeyer
or any of his companies. The probabilities are therefore that the
plaintiffs contracted with the defendant on the basis
that the
defendant would give them the usual undertaking as per Annexure “A”,
which was usually given to them for bridging
finance transactions.
[21]
The second issue to be determined by this court is whether the
defendant gave the plaintiffs an undertaking to repay the loan
and
issued Annexure “A”. The defendant’s counsel argued
that the plaintiffs relied on the written document which
is
ostensibly the written part of the agreement (Annexure “A”
letter). Counsel submitted that it is trite that the
plaintiffs need
to prove that the document was issued and signed by the defendant’s
representatives alternatively in casu
that it was issued by the
defendant’s representatives and that the defendant is bound
thereto and relied on the Da Silva
v Janowski case
3
.
[22]
The second plaintiffs version is that Annexure “A" was
drawn and handed to her by Ms Myburgh on 4 September 2008
after
requesting same from her. The defendant’s version is that
Annexure “A" was never drawn by Ms Myburgh nor
Mrs Swart
and that the letter was not Ms Myburgh’s style. The defendant
insisted that the plaintiffs contracted with Mr Linkmeyer
and that
the transaction was not a conveyancing transfer transaction and that
Annexure “A" would not be used for this
type of
transaction. The defendant’s counsel also proposed that the
letter was created by the second plaintiff at a later
stage as she
had access to the defendant’s computer system. The second
plaintiff generated the letter in order to make a
fraudulent
representation that the letter was issued by the defendant and the
letter was not signed by the defendant’s representatives.
[23]
In order to evaluate both parties’ versions it is necessary to
mention that the defendant, a firm of attorneys, with
expert
knowledge of the law, could not submit any corroboratory document,
being a contract letter or other correspondence for its
proposition
that the plaintiffs contracted with Mr Linkmeyer, their client, or
any other company that he holds a stake in. The defendant
could not
even produce any written instructions from their client, Mr Linkmeyer
on how the monies should be paid out. Annexure
“A” letter
was a template which was used in the defendant’s office for
bridging finance transactions at an interest
fee of 5%. In the
absence of any document to prove the alleged loan agreement between
the plaintiffs and Mr Linkmeyer I am satisfied
that the probabilities
are therefore that the plaintiffs contracted with the defendant on
the basis that the defendant would give
an undertaking for the
repayment of the loan. Annexure “A” was issued by the
defendant’s representative(s) and
the defendant is bound
thereto. The fact that Annexure "A” was not signed is not
an issue in casu as there is evidence
of numerous undertaking letters
issued by the defendant to the investors without being signed.
[24]
There is yet another ground which I consider that the defendant’s
version should fail. Annexure “A” indicated
that the
legal entity the plaintiff contracted with is Mascador/Max Return.
From the companies’ search produced by the defendant
4
,
it was clear that Mascador 160 (Pty) Ltd changed its name to Union
Capital (Pty) Ltd on 7 July 2006. By 2008, the defendant had
no
client called Mascador. According to Mr Linkmeyer's testimony,
Mascador 160 (Pty) Ltd, changed the name to Union Capital (Pty)
Ltd,
a holding company and that Union Equity Trust Ltd’s shares were
held by Union Capital (Pty) Ltd. The monies paid into
the defendant’s
trust account, was received on behalf of Mascador 160 (Pty) Ltd
and/or Union Capital (Pty) Ltd. Union and
Equity Trust Ltd was
deregistered during 2012.
In
these circumstances, if the defendant’s version is to be
accepted as the truth, Mr Linkmeyer and/or Union & Equity
Trust
Ltd could not be held liable for the plaintiffs’ loss because
the companies do not exist.
[25]
The argument advanced by the defendant cannot possibly be true in
that the accounting statements of reconciliation sent to
the
plaintiff’s dated 07 November 2007 and 10 December 2008 were
done by the defendant’s secretary Ms Myburgh. The
defendant
still referred to the transaction as between Mascador and the
plaintiff, which company was not in existence.
[26]
The argument advanced by the defendant carries within itself the
seeds of its own destruction. One of the defendant’s
discovered
documents was an undertaking by Mr Linkmeyer to Mr Marais, dated 19
September 2008.
The
undertaking read as follows:
MAGTIGING
Ek, die ondergetekende:
ROBERT
LINKMEYER IDENTITEITSNOMMER: 741020 5131 08 3 In my hoedanigheid as
gevolmagtigde van UNION EQUITY & TRUST LTD Magtig
ADRIAAN MARAIS
om die bedag van R400 000-00 (vierhonderd- duisend rand) direk in MAX
RETURN 106 (PTY) LTD se bankrekening te deponeer.
Voormelde
bedrag word deur ADRIAAN MARAIS aan UNION EQUITY & TRUST LTD
voorgeskiet teen ‘n vergoeding van R20 000-00
(TWINTIGDUISEND
RAND). Die kapitaie bedrag plus R20 000-00 vergoeding is
terugbetaalbaar uit die eerste beskikbare fondse ten gunste
van UNION
EQUITY & TRUST, welke fondse ontvang word in BURDEN & SWART
PROKUREURS se trustrekening.
GETEKEN
TE PRETORIA OP HIERDIE 19DE DAG VAN SEPTEMBER 2008. R LINKMEYER'
[27]
If the defendant’s version is to be believed it is strange that
the defendant did not ensure that Mr Linkmeyer gave a
similar
undertaking to the plaintiffs. Furthermore, Mr Marais enjoyed an
interest of 7% on his investment, which was interest not
given to the
plaintiffs. The plaintiffs’ interest on their loan was the
standard 5% given by the defendant.
[28]
I agree with the plaintiff’s counsel’s
5
submissions that the principles pertaining to the adjudication of
this matter are set out in Selamolele v Makhado 1988 (2) SA 372
(V)
at 374 f:
11
Ultimately the question is whether the onus on the party, who asserts
a state of facts, has been discharged on a balance of probabilities
and this depends not on a mechanical quantitative balancing out of
the pans of the scale of probabilities but, firstly, on a qualitative
assessment of the truth and/or inherent probabilities of the
witnesses and, secondly, an ascertainment of which of two versions
is
the more probable."
[29]
It is my view that the second plaintiff was an honest and credible
witness and the court accepts her evidence as the truth.
I am
satisfied that sufficient reliance can be placed on her version for
there exists a strong probability that her version is
the true one. I
am also satisfied that on adequate grounds above-mentioned, the
plaintiff’s version is more probable than
that of the
defendant. The defendant’s version is unlikely and improbable.
I am not persuaded that the loan was negotiated
with Mr Linkmeyer and
I am satisfied that the defendant undertook to repay the plaintiffs
as set out in Annexure “A”.
[30]
In the circumstances, the following order is made:
(a)
Judgement is granted in favour of the plaintiff for an amount of R426
000-00; (a) interest at a rate of 15,5% per annum from
18 March 2010
(being the date of demand) until date of payment;
(c)
Costs of the suit.
D.S.
MOLEFE
JUDGE
OF THE HIGH COURT Date Heard: 7, 8 and 9 May 2013
Date
Delivered: 27 August 2013
On
behalf of Plaintiff: HARDAM & ASSOCIATES INC.
Plaintiff’s
Attorneys
4th
Floor, Building 3, Outsurance Campus
1241
Embankment Road, Centurion
P
O Box 11008, Centurion, 0046
Tel:
(012) 336 3173
Fax:
(012) 673 4916
Email:
herbst@legalinc.co,za
Ref:
GOV257/0001/GH
Counsel
for Plaintiff: Adv. A Botha
On
behalf of Defendant’s: BURDEN AND SWART ATTORNEYS
Defendant’s
Attorneys 480 William Street Crn Fehrsens Street
Brooklyn,
Pretoria Tel: (012) 346 3554 Ref: Mr Burden/at/B1356
Counsel
for Defendant’s: Adv. T Strydom SC
1
Advocate
T. Strydom SC
2
1931
AD
187
at
199
3
1982
(3) SA 205 A
4
Exhibit "A"
5
Advocate
A. Botha