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[2024] ZAECMHC 36
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Old Mutual Insure Limited v Saider Towing Service CC (2021/2023) [2024] ZAECMHC 36 (23 May 2024)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE DIVISION, MTHATHA)
Not
Reportable
CASE
NO. 2021/2023
In
the matter between:
OLD
MUTUAL INSURE
LIMITED
Applicant
Registration
number: 1970/006619/06
and
SAIDER
TOWING SERVICE
CC
Respondent
Registration
number: 2008/029794/23
EX
TEMPORE JUDGMENT
KUNJU
AJ:
A.
Introduction
[1]
Risky as it is, this litigation is a necessary
one for the applicant. Risky because the value of the damaged vehicle
and its status
are unknown by the applicant. A necessary litigation
because the applicant does not believe that the towing charges
claimed by
the respondent are reasonable and it being the owner of
the vehicle, it needs it to its possession.
[2]
On the other hand, respondent, implicit in its
conduct is the invocation of
quid
pro quo
doctrine
.
[3]
At the centre of it all is the right of lien. The
issue is less about its existence but more about whether the security
that has
been tendered is adequate to defeat the lien. In the main,
the horns between the parties are locked on this aspect of the case.
[4]
For proper appreciation of the facts, it is
necessary that I write this judgment following these headings: (a)
truncated background,
(b) contention of the parties, (c) discussion,
and (d) conclusion.
[5]
I hasten to do so below.
B.
Truncated background
[6]
Old Mutual and Ms D. T. Rodolo had concluded a
short term insurance agreement in respect of a vehicle morefully
described as Hyundai
i20, registration no. J[…],
VIN
number M[…] engine number G[…] (the insured vehicle).
Ms Rodolo was the owner of the car at the time.
[7]
On 7 March 2023 in the evening the insured
vehicle was involved in an accident on R61 Dangwana Area on the road
between Port St
Johns and Lusikisiki, both being towns falling within
the jurisdiction of this court.
[8]
The insured vehicle was towed away by the
respondent’s towing truck and was kept at its storage place
situated at Genvale
Location, Port St Johns.
[9]
A settlement or loss of the claim was signed
between Old Mutual and Ms Rodolo (Ms Rodolo). Subsequently, the
applicant’s representative
and the respondent spoke and in
turn, an invoice for the alleged services of the respondent was
dispatched to the applicant. Subsequent
to receipt of the invoice,
the applicant vehemently contested the charges as unreasonable and
inflated. The respondent in turn
maintained as he still does, that it
is reasonable.
[10]
Applicant sent correspondence to the respondent
dated 3 April 2023. In pertinent parts the following is stated:
“‘
4 Please
note that our client disputes that the amount of R18 112.50 is
due and payable to yourselves. After careful consideration
of towing
gate, administration, recovery and storage fees to be charged in
terms of industry norms, our client is of the view that
an amount f
R8 780.25 constitute a fair and reasonable amount.
.
. .
6 In the premises, our
client offers to pay the amount of R8 780.25 to release the
vehicle to our client. Attached as annexure
“C’ a
breakdown of the charges that our client paid. Ou client is further
prepared to set security for balance of your
alleged claim. We
request that in light of the aforegoing that the vehicle be released
immediately.
7 . . . We furthermore
confirm that we hold the balance (R9 332.25) on trust as
security pending institution of an action by
you within 30 (thirty)
days for payment of whatever the amount you believe are owing.
8 We urge you to
reconsider your position and to accept our client’s tender of
security and payment in the amount of R8 780.25.
. . ”
[11]
In response to the above email, a very short
response which appears to be somewhat aggressive was written. In
relevant parts it
reads:
“
Kindly be
informed that your
client’s
car
will
not be released until the amount referred to in the invoice is paid
in full.
Take further notice
that the storage fee will accumulate accordingly.
We further advise you
that any application in court will be defended.”
[12]
The culmination of the above exchange of
correspondence was the institution of this application. The most
relevant parts of the
notice of motion are stated hereunder:
“
1. The
respondent is ordered to release a HYUNDAI I20 motor vehicle with
registration letters and numbers J[…], VIN
number M[…]
and Engine number G[…] (“the Motor vehicle”) to
the applicant’s nominated representative
within 24 hours of the
service of this order.
3. The
applicant having made payment to the respondent in the amount of
R8 780.25, and the balance of the respondent’s
invoice,
being an amount of R9 332.25 having been paid into the
applicant’s Attorneys trust account, shall pay the further
storage charges (calculated at R350.00 per day from 03 April 2023
until the date upon which this order is granted) into the trust
account of the applicant’s attorneys within 5 (five) days of
the service of this order to be retained as security pending
the
final resolution of any legal proceedings to be instituted by the
respondent within 30 (thirty) calendar days of the service
of this
order to claim its legal fees for the towing, storage, recovery,
administration and security in respect of the vehicle;
4. Should
the respondent fail to institute legal proceedings contemplated in
paragraph 3 above within 30 (thirty) calendar
days after the service
of this order, an amount paid into the trust account of the
applicant’s attorneys shall be released
to the applicant.”
[13]
The application was served and filed on 11 May
20223. When the matter was not opposed attempts to secure a judgment
by default on
6 June 2023 were thwarted by the respondent’s
delivery of its notice to oppose on 30 May 2023, few days before the
hearing
date. On 6 June 2023 it is recorded that the application was
removed from the roll and the respondent was directed to pay the
costs
occasioned by the removal of the matter.
C.
Applicant’s contentions
[14]
The applicant contends that regard given to the
principles of lien:
[14.1] the court
has a power to order delivery of the insured vehicle to the owner
against adequate security being furnished;
[14.2] the security
need not cover the costs of a possible action by the lien holder
since the security is regarded as a mere
substitution for the lien
and not as an additional security;
[14.3] where
security is tendered, guaranteed the full amount of the respondent’s
claim, including further storage,
that is sufficient, and the return
of the vehicle ought to be ordered;
[14.4] the court
should concern itself with the adequacy of the security not whether
the respondent was authorised to tow
the insured vehicle or not; and
[14.5] the security
tendered covers the claim of the respondent including future storage
costs of the order.
D.
Respondent’s contentions
[15]
That a contract for the towing of the insured
vehicle was concluded between the applicant and Ms Dorcas Tabita
Rodolo through a
telephone discussion. The terms of the agreement
were:
[15.1] The
respondent would tow the vehicle as was requested by Ms Rodolo. A
call out charge of R4 500.00, recovery fee
of R500.00 per every
fifteen minutes, gate storage of R500.00, the administration fee at a
rate R350.00 a day as well as a value
added taxed prescribed by law
were levied to be charged. He contends that Ms Rodolo agreed. In that
way a verbal agreement was
concluded.
[16]
He contends that the vehicle is in possession of
the respondent by virtue of the said terms of the agreement. It will
be released
once the full amount is paid as agreed between the
respondent and Ms Rodolo. He also acknowledges in paragraph 6 of the
heads of
argument that the insured vehicle is now owned by the
applicant consequent to the transfer thereof prior to the institution
of
this application.
[17]
He contends that his refusal to release the
vehicle is informed by the verbal agreement she concluded with Ms
Rodolo and he relies
on the principles of contract such as
pacta
sunt servanda
(sanctity of contracts).
[18]
He argues that the matter deserves to be referred
to oral evidence apparently on the existence or otherwise of the
verbal agreement.
It would seem he bases that argument on the fact
that Ms Rodolo filed a confirmatory affidavit disputing that she
entered into
an agreement with the respondent.
E.
Discussion
[19]
The way I see it, the parties have raised various
disputes and these disputes cannot be resolved in these application
papers. They
include. (i) whether the agreement was reached or not,
(ii) whether the fees charged are fair and reasonable. I understand
that
the payment of a security is predicated on the acknowledgement
and appreciation of the existence of the disputes.
[20]
In appreciation of these disputes, the applicant
issued these proceedings on the basis that a reasonable security was
offered to
the respondent so that her claim of lien is defeated. The
result would have been that the disputed issues are ventilated in a
trial
court. If a letter that heralded these proceedings did not
signal that enough to the respondent, the notice of motion makes it
plain.
[21]
To raise all those disputes which would have been
ventilated during a trial previously proposed by the applicant is not
an answer
to this application. Said otherwise, the disputes raised
are irrelevant for purpose of this application.
[22]
I consequently hold a view that the disputed
issues are directed towards recovering the outstanding amounts not so
much on the security.
As such, a security for the payment has been
made. Whether it is reasonable or not is something that should be at
the centre of
this application.
[23]
Long before the institution of this application a
letter adverted to above dated 3 April 2023 was written to the
applicant stating
that an amount of R8 780.25 was paid to the
respondent and that the balance (R9 332.25) was kept by the
applicant’s
attorney in a trust account. Trust account of
attorneys is designed to keep and invest clients’ monies. The
attorneys in
this matter for the applicant confirmed that security is
in their possession.
[24]
The respondent’s attorneys did not dispute
the contents of the letter nor did they propose any other form of
security which
satisfies them. I find the approach of the respondent
very unreasonable and attracted an unnecessary litigation.
[25]
An option was available to the respondent to
serve summons as previously proposed and raise all the defences that
allegedly entitle
it to the fees and charges contained in his
invoice. During the envisaged trial some of the issues are likely to:
(a) whether the
charges of the respondent were agreed to or not and
(b) whether the charges are reasonable or not.
[26]
The right of lien raised by the respondent is
understood to be a right to retain physical control of another’s
property, whether
movable or immovable, as means of securing payment
of a claim relating to the expenditure of money or sometimes of
monetary value
by the possession until the claim is satisfied
(
Brooklyn House Furnishers (Pty) Ltd v
Knoetze and Sons
1970 (3) SA 364
(AD)
at 270E
).
[27]
The said right of lien relied upon by the
respondent in resisting to release the vehicle may be defeated by
furnishing of adequate
security for the payment of debt secured.
(
Hochmetals Africa (Pty) Ltd v Otari Mining
Co (Pty) Ltd
1968 (1) SA 571
AD at
582
).
[28]
The payment to the attorney’s trust account
of the balance of the claim of the respondent and an undertaking to
pay the balance
on the success of the respondent’s claim to me
is a reasonable approach to which the respondent paid no deserving
attention.
[29]
No doubt, the envisaged claim of the respondent
would have progressed significantly by now. The respondent elected to
invest on
this application than investing its resources towards the
proposed recovery process.
[30]
I do not get a sense that once the insured
vehicle is released the applicant will delay the respondent’s
recovery of his expenses.
The converse is true, looking at the
contents of a letter written by the applicant as mentioned above.
[31]
The applicant as the owner of the insured vehicle
is entitled as it has done so, to furnish security for payment of the
debt (in
this case the balance and storage costs) and as against the
furnishing of that security to release of the vehicle held (
Pheiffer
v Van Wyk and others
2015 (5) SA 464
SCA
).
[32]
I am not persuaded that the attorney and client
costs are warranted. I could not discern a complex and complicated
aspect of the
matter that necessitates scale “C” and “B”
under rule 67A of the Rules of Court. Scale “A” is
fitting.
F.
Conclusion
[33]
In exercise of my discretion, I find that the
substitute security tendered is adequate and that the applicant is
entitled to delivery
of the insured vehicle.
[34]
In the result, I grant the following order:
(a)
The respondent is ordered to release a HYUNDAI
I20 motor vehicle with registration letters and numbers J[…],
VIN number M[…]
and Engine number G[…] (“the
Motor vehicle”) to the applicant’s nominated
representative within 5 (five)
days of the service of this order upon
it.
(b)
In the event of the respondent failing,
alternatively, refusing to comply with the order in paragraph (a)
above, the sheriff is
authorised to take possession of the vehicle
wherever it may be found and to forthwith hand over possession of the
vehicle to the
applicant’s nominated representative.
(c)
The applicant having made payment to the
respondent in the amount of R8 780.25, and the balance of the
respondent’s invoice,
being an amount of R9 332.25 having been
paid into the applicant’s Attorneys trust account, shall pay
the further storage
charges (calculated at R350.00 per day from 03
April 2023 until the date upon which this order is granted) into the
trust account
of the applicant’s attorneys within 5 (five) days
of the service of this order to be retained as security pending the
final
resolution of any legal proceedings to be instituted by the
respondent within 30 (thirty) calendar days of the service of this
order to claim its legal fees for the towing, storage, recovery,
administration and security in respect of the vehicle;
(d)
Should the respondent fail to institute legal
proceedings contemplated in paragraph (c) above within 30 (thirty)
calendar days after
the service of this order, an amount paid into
the trust account of the applicant’s attorneys shall be
released to the applicant.
(e)
The respondent is ordered to pay the costs of
this application on the party and party scale “A”.
V
KUNJU
ACTING
JUDGE OF THE HIGH COURT
Appearances:
For
the applicant:
Adv Hobbs
Instructed
by:
Pierre Krynauw Attorneys
Email:
frik@krynauwlaw.co.za
Ref: Van
Niekerk/gs/OM7335
c/o J A Le Roux Attorneys
56 Leeds Road
MTHATHA
Tel: 047 531 4223
REF: PP0080
For
the respondent:
No Appearance.
Heard:
23 May 2024.
Delivered:
23 May 2024.