IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
CASE NO: 25696/2024
In the matter between:
NEW LIFE HOLDINGS (PTY) LTD Applicant
And
STEFANUS VAN WYK VAN DER HOVEN First Respondent
JACOBUS REYNEKE VAN DER HOVEN Second Respondent
NEIL FRANS ROETS Third Respondent
Neutral Citation: New Life Holdings (Pty) Ltd v Van Der Hoven and Others (Case no
25696/2024) [2026] ZAWCHC … (01 June 2026)
Corum: Lekhuleni J
Heard: 21 May 2026
Delivered: 1 June 2026
Summary: Leave to appeal - Contract – Test for leave to appeal - difference between
suretyship agreement and guarantee – Guarantee clauses make it clear that the contract
between the parties is not a suretyship but creates principal and independent obligations
which remain enforceable notwithstanding the invalidity or unenforceability of the guaranteed
obligations. Application for leave to appeal dismissed.
JUDGMENT – LEAVE TO APPEAL
LEKHULENI J:
Introduction
[1] For convenience, I will refer to the parties as they are cited in the main
application. This is an application for leave to appeal the whole of the judgment (‘the
main judgment’) of Nuku J dated 23 October 2025 to the Full Court, alternatively to
the Supreme Court of Appeal (‘the SCA’) in terms of section 17(1)(a) of the Superior
Courts Act 10 of 2013 (‘the Superior Courts Act’). In that judgment, Nuku J granted
an order in favour of the applicant. The order directed the respondents to jo intly and
severally pay the applicant a capital amount of R8,376,045.00 in accordance with the
guarantee agreement, dated 31 March 2023, signed by the respondents in favour of
the applicant. Since Nuku J is currently acting in the Constitutional Court, the Judge
President has allocated this application to this court for consideration of the
respondents’ leave to appeal application.
Brief background facts
[2] To give context to the order I make hereunder, I deem it proper to briefly set
out the background facts underpinning this application. On 14 March 2023, in
Pretoria, the applicant, duly represented, and Climealine, also duly represented,
concluded a written agreement under which the applicant sold its 25 per cent shares
and its loan account in Imalisoft to Climealine. The purchase price for the shares was
agreed at R8 million, and the purchase price for the loan account was determined at
R618,500.00, payable in monthly instalments. Pursuant to the conclusion of the
share sale agreement, the applicant transferred the 25 per cent shares to Climealine.
[3] During March 2023, the applicant and the three respondents concluded a
written guarantee agreement in terms of which the respondents jointly and severally,
irrevocably and unconditionally, guaranteed and undertook as principal and
independent obligation in favour of the applicant, its successor in title and assigns,
the due and timeous performance by Climealine of all the guaranteed obligations.
the due and timeous performance by Climealine of all the guaranteed obligations.
The respondents bound themselves as co -principal debtors i n solidum with
Climealine for the due and timeous payment by Climealine of each amount owing by
Climealine to the applicant under the share sale agreement.
[4] The applicant alleged that during December 2023, Climealine defaulted on its
obligations under the share sale agreement by failing to make payment to the
applicant and thereafter continued to fail to pay the contractually agreed instalments.
The applicant thereafter claimed the outstanding amount owing and payable to the
applicant. On 5 August 2024, the applicant issued a demand to each of the
respondents in terms of clause 5.10 of the guarantee, calling on the respondents to
make payment in the sum of R8 376,045 plus interest at the rate of 15,75 per cent
from 1 July 2024 to the date of payment. The applicant contended that despite the
demand, the respondents failed to make payment, which, according to the applicant,
constituted a breach of the guarantee agreement. The applicant thus instituted an
application against the three respondents, praying for judgment against them for the
outstanding amount of R8 376 045.00.
[5] The respondent opposed the application and raised two preliminary points of
lis pendens. In the first preliminary point of lis pendens, the respondents averred that
the applicant seeks a money judgment against them based on two agreements: the
share sale agreement and the guarantee. The respondents asserted that, on proper
interpretation of the guarantee, their liability under the guarantee depends on
Climealine’s liability to the applicant under the share sale agreement. This is
necessarily so, in that, in terms of the guarantee, the respondents are liable to the
applicant for the obliga tions of Climealine to the applicant in terms of the share sale
agreement. According to the respondents, the purpose of the guarantee is obviously
to make the respondents liable for Climealine’s debts under the share sale
agreement, only if Climealine is liable to the applicant in the first place.
[6] The respondents further stated that the applicant repudiated the share sale
agreement it had with Climealine when, in its letters attached to the founding affidavit
agreement it had with Climealine when, in its letters attached to the founding affidavit
marked FA4, FA6, FA7 and FA8, it purported to cancel the share sale agreement.
According to the respondents, the applicant was not entitled to cancel the share sale
agreement, so that its purported cancellation is a repudiation. Climealine accepted
the applicant’s cancellation of the share sale agreement and tendered the return of
the applicant’s shares and loan account to the applicant. Pursuant to the cancellation
of the agreement, Climealine claimed repayment of the sum of R1.5 million it paid
the applicant in the Limpopo High Court (‘the cancell ation action’). The respondents
further asserted that following the cancellation of the agreement, Climealine’s
reciprocal obligations to pay the purchase price for the shares and loan account
were suspended.
[7] More importantly, the respondents posited that the summons in the
cancellation action in the Limpopo High Court was issued on 3 March 2024. The
applicant’s plea in that action is dated 5 June 2024 and delivered on that date. This
application was instituted on 5 December 2024, well after the cancellation action. To
this end, whether the share sale agreement was cancelled and whether the applicant
repudiated the share sale agreement are lis pendens in the cancellation action. The
respondents’ second point in limine concerned whether Climealine is liable to the
applicant to pay the amounts claimed against the respondents in this application.
The respondent asserted that the issue of whether Climealine is liable to the
applicant in terms of the share sale agreement is the subject matter of another action
in the Limpopo High Court ins tituted by Climealine against the applicant. The
respondents contended that the issue in this application is thus pending in the
Limpopo High Court action.
Findings in the main Judgment
[8] The principal issue in the main judgment was whether the guarantee
agreement created autonomous and independent obligations enforceable upon
written demand, or whether the respondents’ liability was merely accessory to the
underlying obligations of Climealine under the sale of shares agreement. After
considering the issues, the court concluded that the guarantee created principal and
independent obligations enforceable notwithstanding disputes relating to
Climealine’s liability under the sale of shares agreement.
[9] The court also found that clause 5.10 of the guarantee requires the
respondents to pay upon receipt of a written notice (demand) from the applicant
stating that any amount is due and payable. The court also noted that this clause
stating that any amount is due and payable. The court also noted that this clause
also provided that the respondents’ liability to pay shall be joint and seve ral, and that
the obligations to pay shall be notwithstanding that the respondents dispute their
liability to make such payment. The court found that the guarantee agreement makes
it clear that the respondents’ obligations to pay are triggered when the applicant
provides written notice demanding payment of any amount the applicant claims is
owed.
[10] The court rejected the respondents’ argument that the use of the term co -
principal debtor in one or more clauses of the guarantee indicates an intention to
make the respondents’ liability subject to Climealine’s liability. The court noted that
the reference to the respondents at para 5.1.2, as binding themselves as co-principal
debtors in solidum with Climealine, cannot, without more, result in the respondents’
obligations being the same as those of Climealine. The court also found that the
respondents’ defences regarding the dispute over Climealine’s liability are unhelpful.
In the absence of fraud, the court found that the respondents cannot avoid payment
once the applicant served them with a written demand stating that any amount is
owed. In the court’s view, the applicant has done so, and it followed that the
applicant was entitled to judgment. Consequently, the court granted judgment in
favour of the applicant. It is this order that the respondents seek leave to appeal so
that they can challenge it in the Court of Appeal.
Grounds of Appeal
[11] The respondents raised several grounds of appeal. In summary, the
respondent’s grounds of appeal, as discernible from the notice of appeal, can be
summarised as follows: The respondents assert that they have a reasonable
prospect of success on appeal. The respondents contended that the cour t erred in
the main application in finding that the notice under clause 5.10 of the guarantee
renders the respondents liable without more, and that it is not permissible for the
respondents to rely on clause 5.4. The respondents submitted that the court
interpreted clause 5.10 of the guarantee as barring them from relying on clause 5.4
to raise a defence to the applicant’s application. The respondents further asserted
to raise a defence to the applicant’s application. The respondents further asserted
that clause 5.10 should not be interpreted as barring them from raising a defence.
[12] The respondents believe interpreting clause 5.10 in a way that denies them
the right to rely on clause 5.4 breaches the rule that, as far as possible, every word
in a contract should be given a meaning. If clause 5.10 means that the respondents
cannot rely on clause 5.4 as a defence, then it renders clause 5.4 meaningless. The
respondents contend that the meaning ascribed to clause 5.4 in the main judgment
suggests that even if it was common cause that Climealine paid the purchase price
for the shares and loan account in terms of the sale of shares agreement in full, then
nonetheless, the respondents remained obliged to pay the same amount to the
applicant for a second time.
[13] In addition, the respondents believe that an interpretation of cla use 5.10 that
bars them from relying on clause 5.4 is also contrary to the rule of interpretation that
a contract should be interpreted in favour of validity rather than invalidity. The
respondents argued that the interpretation of clause 5.10 in the judgment does not
give due consideration to the context of the guarantee itself, the circumstances in
which it was concluded, or the purpose of the guarantee.
[14] The respondents also stated that the court erred in finding that the guarantee
does not make th e respondents’ obligations conditional on Climealine’s obligations.
In the respondents’ view, this finding does not give due consideration to the fact that
the guaranteed obligations are Climealine’s obligations. Therefore, if Climealine has
no obligations, there are no guaranteed obligations. The respondents pointed out
that their obligations are therefore conditional upon the continued existence of
Climealine’s obligations.
[15] Notably, the respondents pointed out that the summons in the cancellation
action in the Limpopo High Court was issued on 3 March 2024. The applicant’s plea
in that action is dated 5 June 2024 and delivered on that date. This application was
instituted on 5 December 2024, well after the cancellation action. To this end, the
respondent asserted that the question of whether the share sale agreement was
cancelled and whether the applicant repudiated it is lis pendens in the cancellation
action.
action.
[16] The respondent stated that they are entitled to rely on the cancellation of the
sale of shares agreement. As such, the application should have been dismissed with
costs. The respondent also argued that the application to strike out the new material
in the replying affidavit should have been granted and that the application to admit
the respondents’ fourth affidavit should have been admitted.
The applicable legal principles
[17] The respondents’ application for leave to appeal is based on section 17(1)(a)
of the Superior Courts Act. Section 17 of the Superior Courts Act regulates
applications for leave to appeal from a decision of a High Court. It provides as
follows:
‘(1) Leave to appeal may only be given where the judge or judges concerned are of
the opinion that—
(a) (i) the appeal would have a reasonable prospect of success; or
(ii) there is some other compelling reason why the appeal should be heard, including
conflicting judgments on the matter under consideration;
(b) the decision sought on appeal does not fall within the ambit of section 16(2)( a);
and
(c) Where the decision sought to be appealed does not dispose of all the issues in
the case, the appeal would lead to a just and prompt resolution of the real issues
between the parties.'
[18] The test, which had been applied previously in similar applications, was
whether there were reasonable prospects that another court might come to a
different conclusion. With the enactment of section 17 of the Superior Courts Act, the
threshold for granting leave to appeal a judgment of the High Court has been
significantly raised. There can be little doubt that the use of the word ‘would’ in
section 17(1)(a)(i) of the Superior Courts Act implies that the test for leave to appeal
is now more onerous. The intention is clearly to avoid our courts of appeal from
being flooded with frivolous appeals that are doomed to fail. 1 The use of the word
‘would’ in subsection 17(1)(a)(i) of the Act imposes a more stringent threshold
compared to the provisions of the repealed Supreme Court Act 59 of 1959.2
1 See Valley of the Kings Thaba Motswere (Pty) Ltd and Another v Al Mayya International
(EL926/2016, 2226/2016) [2016] ZAECGHC 137 (10 November 2016) para 4.
(EL926/2016, 2226/2016) [2016] ZAECGHC 137 (10 November 2016) para 4.
2 S v Notshokovu [2016] ZASCA 112 para 2.
[19] What is required of this Court is to consider, objectively and dispassionately,
whether there are reasonable prospects that another court will find merit in the
arguments advanced by the respondents. 3 These principles emphasise that the
requirement for a successful leave to appeal is more than a mere possibility that
another court might come to a different conclusion. The test is whether there is a
reasonable prospect of success that another court would come to a different
conclusion.
Discussion
[20] The respondents’ main grounds of appeal are that there are reasonable
prospects that another court would find that Nuku J erred in dismissing their grounds
of opposition. I must mention from the outset that I am not persuaded that the
submissions raised by the respondents in the application for leave to appeal would,
or, for that matter, might be upheld by another court. I must emphasise that all the
grounds raised by the respondents in this application were thoroughly and
thoughtfully considered by the court and largely rejected in the main judgment.
[21] On the grounds of appeal discussed above, it is necessary for this court to
emphasise that there is a difference between a suretyship agreement and a
guarantee agreement. A suretyship is only one form of intercession, that is, a
transaction in which one person undertakes liability for another's debt. 4 A suretyship
agreement is accessory to a principal obligation. Suretyship can only exist as
accessory to a principal debt. Put another way, every suretyship is conditional upon
the existence of a principal obligation.
[22] In Orkin Lingerie Co (Pty) Ltd v Melamed & Hurwitz, 5 Trollip J observed that a
contract of suretyship in relation to a money debt is one in which a person (the
surety) agrees with the creditor that, as an accessory to the debtor's primary liability,
he too will be liable for that debt. Importantly, in the context of this case, the essence
he too will be liable for that debt. Importantly, in the context of this case, the essence
of suretyship is the existence of the principal obligation of the debtor to which that of
3 See Valley of the Kings Thaba Motswere (Pty) Ltd and Another v Al Maya International [2016] 137
(ZAECGHC) 137 (10 November 2016) para 4.
4 Forsyth CF and Pretorius JT Caney’s: The Law of Suretyship in South Africa (2010) 6 ed at 26.
5 1963 (1) SA 324 (W) at 326.
the surety becomes accessory. Simply put, for there to be a valid suretyship, there
must be a valid principal obligation between the debtor and the creditor. 6 Thus, if the
principal debtor's obligation is legally non-existent, for example if it is founded upon a
fraud, there can be no suretyship of it. It was stated in African Life Property Holdings
(Pty) Ltd V Score Food Holdings Ltd, 7 that guaranteeing a non -existent debt is as
pointless as multiplying by nought.
[23] Conversely, with a guarantee, on the other hand, a person (guarantor)
undertakes as a self-standing principal obligation to indemnify the creditor of another
person on the happening of certain events. The guarantor’s obligation is therefore
independent from that of the debtor, even if that is to indemnify the creditor for losses
suffered because of a debtor’s non -performance, irrespective of the grounds,
therefore. If a creditor suffers losses when it transpires that the debtor’s principal
contract to the creditor is invalid, the guarantor’s obligation remains in force and he
will have to pay those losses, whereas a surety’s obligation falls away and he will not
have to pay anything.8
[24] It must be stressed from the outset that the guarantee between the parties in
this matter must be interpreted in a manner that gives effect to its terms. The
guarantee under discussion is categorised as an on -demand guarantee. In Set
Square Developments (Pty) Ltd v Power Guarantees (Pty) Ltd and Another and
related matters, 9 the SCA observed that on -demand guarantee requires no
allegation of liability on the part of the contractor under the construction contract.
What is required for the payment is a demand by the claimant, stated to be based on
the event specified in the bond. Simply put, the beneficiary must comply with the
terms of the guarantee. The SCA reaffirmed the principle of autonomy of the
performance guarantee from the underlying contract in Joint Venture between Aveng
performance guarantee from the underlying contract in Joint Venture between Aveng
(Africa) (Pty) Ltd/Strabag International GMBH v South African National Roads
Agency Soc Ltd.10
6 Forsyth CF and Pretorius JT Caney’s: The Law of Suretyship in South Africa (2010) 6 ed at 30.
7 African Life Property Holdings (Pty) Ltd v Score Food Holdings Ltd 1995 (2) SA 230 (A) at 238E-F.
8 See Hutchinson v Hylton Holdings and Another 1993 (2) SA 405 (T) at 412E; Forsyth CF and
Pretorius JT Caney’s: The Law of Suretyship in South Africa (2010) 6 ed at 26.
9 (099/2023 and 150/24) [2025] ZASCA 64 (20 May 2025) para 20
10 2021 (2) SA 137 (SCA) para 7; see also Coface South Africa Insurance Co Ltd v East London Own
Haven t/a Own Haven Housing Association 2014 (2) 382 (SCA) paras 11-17.
[25] The principles referred to above apply with equal force to the present matter.
In fact, the respondents contended that the court erred in the main judgment in
finding that the guarantee does not make the respondents’ obligations conditional on
Climealine’s obligations. According to the respondents, this finding fails to consider
that the guaranteed obligations are Climealine’s obligations and that, if Climealine
has no obligations, there are no guaranteed obligations. The respondents assert that
their obligations are therefore conditional upon the continued existence of
Climealine’s obligations.
[26] I have carefully considered the guarantee agreement in its entirety, and I
respectfully believe that the submissions of the respondents in this regard are
incorrect. The respondents have knowingly and purposefully signed the guarantee
agreement. The agreement they signed is entitled ‘Guarantee’ by and between the
‘applicant and the respondents’. The nature of their obligation under the guarantee
agreement is wholly independent of any underlying contract. 11 This agreement and
its terms are different from those of a suretyship agreement. As discussed, it’s
important to emphasise that our law is settled and firmly recognises the autonomy
principle. This principle establishes the autonomy of the performance guarantee from
the underlying contract.12
[27] In my view, the contract under consideration should be read holistically rather
than being pigeonholed and interpreted in a manner that favours one party. Clearly,
construing the impugned agreement and giving meaning to all the words used
therein, the agreement between the parties is not a suretyship agreement but a
guarantee agreement. All the provisions therein read together are consistent with a
guarantee agreement. The respondents suggest that the guarantee agreement,
notwithstanding its heading and other terms, must be interpreted as akin to a
suretyship agreement, as they contend that their liability can arise only if Climealine
suretyship agreement, as they contend that their liability can arise only if Climealine
is liable to the applicant. The respondents contend that the guarantee obligations are
Climealine obligations. If Climealine has no obligations, there are no guaranteed
11 Bonifacio and Another v Lombard Insurance Company Limited (247/2023) [2024] ZASCA 86 (4
June 2024) at para 16.
12 Joint Venture Aveng (Pty) Ltd / Strabag International GmbH v South African National Roads
Agency SOC Ltd 2021 (2) SA 137 (SCA) para 7.
obligations. This argument, in my view, is at odds with the substance of the
guarantee agreement and cannot be correct.
[28] For completeness, clause 5.2 of the guarantee provides:
‘For the avoidance of any doubt, the obligations of the guarantors, jointly and
severally, under this agreement are principal and independent obligations and
are and will remain enforceable notwithstanding the invalidity or
unenforceability, for any reason whatsoever, of the guaranteed obligations.’
[29] Clause 5.10 of the guarantee provides as follows:
‘Upon receipt by the guarantors, or any of them, of any written notice from the
seller stating that any amount is payable by the guarantors, or any of them, or
that the guarantors, or any of them, are obligated to perform any obligation to
the seller, in terms of this guarantee, the guarantors jointly and severally,
shall, notwithstanding that the guarantors, or any of them, may dispute their
liability to make such payment immediately.’
[30] Clause 8.1 of the guarantee agreement provides:
‘The guarantors waive any right they may have of first requiring the seller (or
any director, shareholder or agent on its behalf) to proceed against or enforce
any other rights or security, or to claim payment from any person or the
purchaser before claiming from the guarantors under this agreement. This
waiver applies irrespective of any law or any provision of any agreement,
document or guaranteed obligation to the contract.’
[31] From these clauses, it cannot be disputed that the guarantee under
consideration amounts to a performance guarantee, which consists of an
undertaking to make payment of an amount of money on the happening of a
specified event. A guarantee of this nature must be paid according to its terms.
Liability under it is not affected by the relationship between the other parties to the
transactions that gave rise to its issue.13
[32] The clauses quoted above make it clear that the contract between the parties
is not a suretyship but creates principal and independent obligations which remain
enforceable notwithstanding the invalidity or unenforceability of the guaranteed
obligations. These clauses, when read together with other clauses of the agreement,
in particular clause 2, 5.1.2; 5.4; 10.1 relied on by Mr Van der Merwe, the
respondents’ counsel, point to one direction only: that the contract between the
applicant and the respondents was a guarantee agreement as opposed to a
suretyship agreement. All the terms of this agreement, when read together, attest to
this finding.
[33] Significantly, the clauses quoted above are inconsistent with the respondents’
proposition, which attempts to characterise the guarantee agreement as an ordinary
accessory suretyship agreement. The respondents contend that if Climealine’s
obligation ceases, the guaranteed obligations likewise cease. This argument, with
respect, ignores the structure and wording of the guarantee agreement. The
guarantee expressly provides that the respondents’ obligation remains enforceable
notwithstanding any disputes regarding Climealine’s liability. Clause 5.2 negates the
respondents’ proposition.
[34] The guarantee explicitly states that the obligations of the guarantors, jointly
and severally under this agreement, are principal and independent and remain
enforceable despite the invalidity or unenforceability, for any reason whatsoever, of
the guaranteed obligations. Additionally, clause 5.4 records that the guarantee
constitutes continuing covering security and will remain in force until the guaranteed
obligations have been unconditionally discharged. These obligations have not been
discharged, as payment was not made to the applicant; hence, judgment was
granted against the respondents.
granted against the respondents.
13 See Firstrand Bank Ltd V Brera Investments CC 2013 (5) SA 556 (SCA) para 2; Lombard
Insurance Co Ltd v Landmark Holdings (Pty) Ltd and Others 2010 (2) SA 86 (SCA) paras 19 and
20; Loomcraft Fabrics CC v Nedbank Ltd and Another 1996 (1) SA 812 (A) para 38; and Minister of
Transport and Public Works, Western Cape, and Another v Zanbuild Construction (Pty) Ltd and
Another 2011 (5) SA 528 (SCA) paras 11 – 15).
[35] To this end, I agree with the views expressed by Mr Voster SC, counsel for
the applicant, that if the respondents’ approach to the guarantee is endorsed, it will
result in a distorted interpretation of the guarantee’s clear language and will render
several clauses therein meaningless and superfluous. Consequently, I am of the
view that the respondents have failed to establish a reasonable prospect that
another court would arrive at a different conclusion. In the circumstances, granting
the respondents leave to appeal to the full court or the SCA will, in my opinion, be a
waste of judicial resources. I am not persuaded at all that there are any reasonable
prospects that the respondents’ assertions would (or, for that matter, might) be
upheld by another court. On a conspectus of all the facts placed before this Court,
there are no prospects of success in granting leave to appeal and the respondents’
application for leave to appeal must fail.
Order
[36] In the result, the following order is granted:
36.1 The respondents’ application for leave to appeal is hereby dismissed.
36.2 The respondents are ordered to pay the costs of this application jointly and
severally on a party-and-party scale, including the costs of two counsels
where so employed, on scale B.
________________________
LEKHULENI JD
JUDGE OF THE HIGH COURT
APPEARANCES:
For the Applicant: Adv J Vorster SC
Adv WJ Botha
Instructed by: Herman Vermaak Attorneys
For the first and second Respondents: Adv Van der Merwe
Instructed by: Senekal Simmonds Attorneys