REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG LOCAL DIVISION, JOHANNESBURG
Case Number: 2024-103074
In the matter b
In the matter between:
SAPOR RENTALS (PTY) LIMITED Plaintiff
and
TELCO GROUP (PTY) LIMITED First Defendant
PRESTON MOODLEY Second Respondent
JUDGMENT
WENTZEL -THOMPSON J
Introduction
[1] The plaintiff applies for summary judgment against the first and second
defendants, jointly and severally, for payment of R218 104.78, interest at the rate
of prime plus 6% per annum from the date of summons to date of final payment,
(1) REPORTABLE: NO
(2) OF INTEREST TO OTHER JUDGES: NO
(3) REVISED: YES
______________ _
DATE SIGNATURE
and costs on the attorney-and-client scale. The claim is brought under rule 32 of
the Uniform Rules of Court.
[2] The plaintiff is Sapor Rentals (Pty) Ltd (“Sapor”). The first defendant, Telco Group
(Pty) Ltd (“Telco”), is the supplier under a written Supplier Agreement concluded
with Sapor on 27 May 2020. The second defendant, Mr Preston Moodley
(“Moodley”), is Telco’s director and the signatory to a document styled a
continuing guarantee executed on the same date. Under the Supplier
Agreement, Telco would refer transactions to Sapor , Sapor would provide
finance for technology rentals, and Telco would supply equipment to end-user
customers.
[3] The claim concerns two transactions referred to Sapor by Telco, said to relate to
St Augustine’s Catholic Church and St Francis Church (“the Church
transactions”). It is now common cause, or at least no longer seriously disputed,
that the transactions were fraudulent- the relevant signatures were forged and
the equipment was never delivered to the Churches.
[4] Sapor, unaware of the fraud, paid the amount owing by it to Telco pursuant to
these transactions. Telco admits receiving R151 551.16 in relation to the church
transactions. Its amended plea goes further and says that, after receipt of the
money, it paid its freelance representative R57 471.83 in respect of the St
Augustine transaction and R39 165.35 in respect of the St Francis transaction.
[5] Sapor’s case is not, however, simply for restitution of the R151 551.16 paid. It
alleges breach of the Supplier Agreement, particularly clause 4.3.2, and invokes
the contractual remedies contained in clauses 7.3.3-7.3.6. It seeks R218 104.78,
comprising R135 772.84 relating to the St Augustine transaction and R82 331.94
relating to St Francis transaction.
[6] Under the provisions of the Supplier Agreement relied upon by Sapor, Telco
warranted, so Sapor contends, that documentation furnished in relation to
proposed transactions was genuine and accurate, that signatures were genuine
proposed transactions was genuine and accurate, that signatures were genuine
and appropriately authorised, and that the equipment was properly delivered and
installed. Sapor says that it was contractually entitled to demand that Telco
repurchase the affected contracts and that the sum of R218 104.78 is payable in
terms of certificates of balance issued under the Supplier Agreement. It further
contends that Moodley is liable under the guarantee he provided to Sapor.
[7] The defendants resist the application. Their case is that the Church transactions
were fraudulently procured by a rogue freelance representative acting without
either defendant’s knowledge, consent or authority. They contend that the
purported end-user agreements were void ab initio, alternatively voidable or
unenforceable, that the relevant conditions precedent were not fulfilled, that
Sapor itself failed to undertake appropriate verification and due diligence and that
the certificates of balance do not establish the amount claimed. Finally, it is
argued that Moodley’s liability under the guarantee is either absent or dependent
on the existence of a valid principal obligation, of which there is none, it being
void or voidable on the grounds of fraud.
[8] The defendants’ central factual allegation is that the alleged freelance
representative secretly orchestrated the fraud without Telco ’s or Moodley’s
knowledge, consent or authority. They accept the underlying factual fraud, but
deny responsibility for it; their case is that the representative was acting for his
own purposes and outside any employment or agency relationship.
[9] There is also an interlocutory issue raised by the defendants concerning Sapor’s
supplementary affidavit in support of summary judgment delivered after the
defendants amended their plea. In this affidavit, Sapor has responded to the
denial of the authority of the alleged freelance representative by raising issues of
estoppel and ratification. The defendants contend that the supplementary
founding affidavit was delivered late, that it introduced new matter outside the
scope of rule 28(8), and that it should be disregarded, in whole or in part. Sapor
has subsequently sought condonation for its late delivery.
[10] Ultimately the question is whether the defendants have disclosed facts which, if
[10] Ultimately the question is whether the defendants have disclosed facts which, if
proved, would constitute a bona fide defence, or defences, that are good in law
and raise a triable issue warranting the refusal of summary judgment and the
referral of the matter to trial.
[11] This is an unduly long judgment, but I feel is necessary to explain to the parties
that I have properly evaluated each of their contentions and to justify why,
although I am of the view that plaintiff’s case is more certain on the probabilities
on the evidence before me, that the defendants should be granted leave to
defend.
[12] This has not been a decision lightly taken, but after a full and complete
consideration of the evidence and the relevant case law.
The chronology of events
[13] The relevant chronology is substantially common cause. The Supplier
Agreement and the guarantee were signed on 27 May 2020. Summons was
delivered during September 2024 its declaration on 26 November 2024.
[14] The defendants delivered their plea during February 2025. Sapor instituted this
application for summary judgment on 4 March 2025. The defendants thereafter
filed their affidavit resisting summary judgment on 11 June 2025. On 23 July
2025 they filed a notice in terms of rule 28 and a supplementary opposing
affidavit. The latter corrected the description of the person responsible for the
alleged fraud; whereas initial affidavit had referred to him as an employee, the
supplementary affidavit stated that he was instead a freelance representative
engaged by Telco from time to time. This indicated a deliberate attempt by Telco
to separate themselves from the conduct of the person implicated.
[15] Sapor then delivered a supplementary affidavit in support of summary judgment
on 5 September 2025. The defendants delivered a further supplementary
affidavit in response. They objected that Sapor’s affidavit was delivered four court
days after the 15-day period contemplated in rule 28(8), and that it advanced
impermissible new matter. That new matter was to raise estoppel and ratification
in response to the denial of authority in the amended plea.
[16] Sapor thereafter instituted a condonation application. That application is opposed
by Telco.
The terms of the Supplier Agreement
[17] The Supplier Agreement regulated a relationship in which Telco would refer
proposed technology-rental transactions to Sapor. Sapor would provide finance
solutions and Telco would supply the equipment. Clause 3.1 provided, in material
part, that purchases of equipment by Sapor from Telco would be binding only if
expressed in writing and subject to the condition precedent that an agreement
on Sapor’s prevailing terms had been concluded with the intending user.
[18] Clause 4.3.2 required Telco to warrant that documents furnished to Sapor in
respect of a referral or proposed agreement were genuine, true and correct in all
respects, that signatures were, to the best of Telco’s knowledge and belief,
genuine, and that signatories purporting to sign on behalf of another were duly
and properly authorised. Clause 4.3.4 required Telco to warrant that the
equipment was fit for its intended purpose and was properly and fully delivered
and installed.
[19] Clauses 7.3.3 to 7.3.6 provided for a remedy at Sapor’s election in the event of
breach. These clauses entitle Sapor to require Telco to purchase the affected
end-user agreement within 45 days, at a consideration calculated by reference
to the collectible under the relevant contract and costs incurred. Against delivery
of the contract, it is deemed ceded to Telco and Telco is required to accept and
uplift the equipment on a voetstoots basis, and at its own cost.
[20] The Supplier Agreement also makes provision for the amount owing to be prima
facie established by way of a certificate signed by a Sapor manager or director
regarding, among other matters, the value of collectables, a shortfall, damages
or any amount owing by Telco, including for purposes of summary judgment.
The terms of the alleged guarantee
[21] Moodley signed a continuing guarantee for the indebtedness of Telco. It records,
in broad terms, that he guarantees Telco’s payment and performance obligations
to Sapor arising out of or incidental to the Supplier Agreement. It provides that
his liability is to be absolute and unconditional notwithstanding circumstances
his liability is to be absolute and unconditional notwithstanding circumstances
which include an underlying cause of indebtedness having no legal effect, being
capable of avoidance or being unenforceable due to a lack of authority. It also
contains a provision restricting the liability of the guarantor to Telco’s obligations
to Sapor under the Supplier Agreement and any addenda.
[22] Moodley alleges that his obligations under the guarantee are, despite its
description, akin to suretyship, rendering it dependent upon the validity of the
underlying end-user agreement. Because he says that the end-user agreement
was void for fraud, he maintains that he has no accessory obligation owing to
Telco under the “guarantee.”
The test for summary judgment
[23] The principles applicable to summary judgment are settled. In Joob Joob
Investments (Pty) Ltd v Stocks Mavundla Zek Joint Venture 1the Supreme Court
of Appeal explained that the procedure is directed at preventing delay through
sham defences but is not intended to deprive a defendant with a triable issue or
sustainable defence of a day in court. The remedy is accordingly drastic only for
a defendant who has no defence to the action.
[24] A defendant must disclose the nature and grounds of the defence and the
material facts on which it is founded with sufficient particularity. That is clear from
Maharaj v Barclays National Bank Ltd2, Breitenbach v Fiat SA (Edms) Bpk3 .The
lack of bona fides may be inferred from bald and bare denials. But the defendant
is not required at this stage to establish the defence on a balance of probabilities.
It is enough to disclose facts which, if established at trial, would constitute a
defence that is bona fide and good in law.
[25] In Tumileng Trading CC v National Security and Fire (Pty) Ltd 4, the Court
observed that a summary-judgment court is concerned with whether a defence
is genuinely advanced rather than a sham, not with determining the substantive
merits or prospects of success of the main action. It should not ordinarily resolve
disputed factual merits that properly belong to the trial court.
[26] Accordingly, I am not required to determine whether the defendant will ultimately
succeed; the enquiry before me is whether the defences are genuinely advanced
1 Joob Joob Investments (Pty) Ltd v Stocks Mavundla Zek Joint Venture [2009] ZASCA 23; 2009 (5) SA 1
(SCA) paras 31-33; 2 Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A) at 423G-426E 3 Breitenbach v Fiat SA (Edms) Bpk 1976 (2) SA 226 (T) at 227G–228F 4 Tumileng Trading CC v National Security and Fire (Pty) Ltd 2020 (6) SA 624 (WCC)
rather than manufactured to obtain delay and should not try and determine
disputes that require oral evidence.
[27] Although the defendants have raised a number of defences, I need only find that
one of the defences raised has been sufficiently disclosed to constitute a defence
if proved at a trial in due course for me to refuse summary judgment,provided of
course that I am satisfied that that defence has been genuinely advanced.
[28] Sapor submits that the defendants’ case is internally inconsistent, inadequately
pleaded and constitutes no more than an attempt to postpone an inevitable
judgment. It relies in particular on the defendants’ receipt of funds, Moodley’s
WhatsApp communications, the written warranties and the certificates of
balance. Those issues may ultimately prove decisive. But the issue is whether
they can properly be treated as determinative at the summary-judgment stage,
notwithstanding the defences raised by the defendants.
The validity of the Church Transactions
[29] The defendants contend that the fraud rendered the Church transactions void ab
initio. Sapor correctly relies upon Pepkor Holdings Ltd v AJVH Holdings5 for the
proposition that a contract induced by fraudulent misrepresentation is ordinarily
voidable at the election of the innocent contracting party, rather than
automatically void.
[30] There is patently a distinction between a transaction induced by fraudulent
misrepresentation and a transaction in which an alleged contracting party ’s
signature is forged or the purported representative lacks authority. The
defendants’ allegation is not that the Churches were fraudulently induced to
contract, it is that there was no genuine agreement by the churches at all as the
signatures were fraudulent.
[31] There is a significant conceptual difference between a genuine contracting party
being fraudulently induced to conclude a contract and a supposed contract
bearing a forged signature of a person who never consented to contract at all.
bearing a forged signature of a person who never consented to contract at all.
5 Pepkor Holdings Ltd and Others v AJVH Holdings (Pty) Ltd and Others; Steinhoff International Holdings NV
and Another v AJVH Holdings (Pty) Ltd and Others (205/2020) [2020] ZASCA 134; 2021 (5) SA 115 (SCA)
The latter raises the logically anterior question whether any agreement was ever
concluded with the Churches. The defendants plead that the signatures were
forged and no equipment was delivered; Sapor itself accepts those factual
propositions. The proposition relied upon by Sapor in Pepkor does not
conclusively resolve such a situation.
[32] However, the legal character of the underlying Church contracts may not
ultimately be decisive if Sapor proves an independently enforceable breach of
Telco’s warranties, that it says, were required to cover situations where the end-
user agreement was a fraud.
The warranties contained in the Supplier Agreement
[33] Sapor submits that the legal status of the end-user is ultimately irrelevant as it
alleges that Telco breached warranties given in that agreement concerning the
genuineness of referral documentation, signatures and authority, as well as
delivery and installation of the equipment. It thus says that the ensuing fraud and
non-delivery trigger its contractual repurchase remedy against Telco. This
constitutes a substantial answer to the defendants’ submission that the Church
transactions were void ab initio.
[34] If Telco independently warranted the integrity of documents furnished by it or on
its behalf and warranted delivery and installation, the invalidity of the end-user
agreements would not, in itself, necessarily defeat a claim based on Telco ’s
breach of those warranties. On that construction, the absence of delivery and the
falsity of the documents may well be the precise events which trigger Telco’s
contractual liability to repurchase the Church transactions.
[35] The qualification in clause 4.3.2 that signatures were genuine “to the best of
[Telco’s] knowledge and belief” is material; its meaning cannot be determined in
isolation and must be interpreted within the commercial context of the agreement
and the other clauses contained in the agreement. Evidence as to how the
and the other clauses contained in the agreement. Evidence as to how the
transactions were processed may also be relevant. Thus, it may be that the
clause places on Telco the risk of fraud by intermediaries used in the referral
process; it may alternatively be that the knowledge -and-belief qualification
preserves a defence where Telco was itself deceived by a person acting outside
its authority.
Lack of authority
[36] The defendants contend that the fraudulent documentation was created and
submitted by a person who lacked actual or ostensible authority, that he acted
independently and for his own benefit, and that the defendants neither knew of
or authorised the fraud. They deny that the forged documents were submitted by
the alleged representative within an employment or agency relationship with
Telco.
[37] In this respect the defendants rely on Brink v Humphries & Jewell (Pty) Ltd6 that
stated, after quoting from Sonarep (SA) (Pty) Ltd v Pappadogianis7 in support of
the principle that:
“In my view, therefore, the decisive question in a case like the present is this: did
the party who is actually intention did not conform to the common intention
expressed, lead the other party, as a reasonable man, to believe that is declared
intention represented his actual intention?”
[38] The defendants submit that the alleged freelance representative’s forgery and
concealment from them means that there was no true consensus between the
parties, creating a triable issue on the validity of the underlying Church
transactions that cannot be resolved on affidavit.
[39] Whether the alleged freelance representative’s conduct is properly described as
conduct by Telco, or by a person acting on its behalf for purposes of clause 4.3.2,
will turn on facts concerning the nature and scope of his engagement and
mandate, the manner in which he was held out to Sapor, his authority to source
or submit transactions, and Telco’s knowledge of his actions and its conduct on
acquiring such knowledge.
[40] But one must have regard to the fact that Telco corrected the description of its
relationship with the individual accused of this fraud, or being a participant in this
fraud in an amendment to its plea after summary judgment had been instituted.
6 [2005] 2 All SA343 (SCA) at paragraph 16 7 1992 (3) SA 234 (A)
As I have said, the defendants initially described this person as an employee, but
changed his status to being a freelance representative. Telco insists that he had
no mandate to commit or participate in fraudulent conduct, and assert that Telco
ended its relationship with him when the fraud was discovered.
[41] The significance of this evidence needs to be carefully weighed, as should this
person in fact have been an employee as initially stated, making it difficult to
argue that he did not act within the course and scope of his employment, this-
and not the true facts, may have prompted the change to his status in the
amended plea. If this change was made to avoid the legal consequences of what
was originally stated, this in and of itself could be said to demonstrate a lack of
bona fides in the defence now postulated by way of amendment. This change in
the status of the alleged perpetrator (or co-conspirator) of the fraud may also
amount to a withdrawal of an admission that would require a full and proper
explanation.
[42] On the other hand, the motive behind the defendants change of the status of the
individual concerned by way of amendment is not a matter that can be finally
determined on the facts before me, and will require oral evidence and cross-
examination; at most, the scenario postulated by me amounts to supposition and
inference that may ultimately not be born out by the facts. It is, however, a matter
that warrants further investigation and can only be decided after the hearing oral
evidence, subject to cross-examination. Thus, although the amendment itself
may ultimately bear adversely on the defendants’ credibility, it is not an issue that
I am in a position to decide demonstrates a lack of bona fides or that the defence
has not been advanced genuinely. I thus cannot at this stage of the proceedings
find that the amended defence is necessarily contrived and should be
disregarded.
Estoppel and ratification
disregarded.
Estoppel and ratification
[43] In Sapor’s supplementary affidavit it relies on estoppel, alternatively ratification
to refute the defendants denial that the person who allegedly perpetrated or was
complicit in the fraud was not authorised. It says that the freelance representative
held himself out as authorised, that the defendants did not immediately challenge
his authority, that Telco accepted payment under the transactions, and that Telco
paid funds onward to a third party. Sapor says it acted to its detriment in financing
the transactions and that Telco and Moodley should accordingly be estopped
from denying the authority of the alleged representative.
[44] The defendants rely on Monzali v Smith,8 Glofinco v Absa Bank Ltd t/a United
Bank,9 and Africast v Pangbourne Properties Ltd and Curtis v Dowdle.10 Those
cases affirm the elementary proposition that, for estoppel based upon ostensible
authority, the representation must emanate from the principal; it cannot rest only
on the alleged agent’s own assertion that he has authority. The defendants’
counsel argued that there was no representation by Telco or Moodley that the
freelance representative possessed authority to forge documents or manufacture
fictitious transactions.
[45] No principal ever ordinarily represents that an agent is authorised to commit
fraud. The question is whether the principal represented that the person had
authority to perform acts of the general character involved - for example,
obtaining and submitting customer applications - so that the innocent
counterparty was entitled to treat those acts as authorised.
[46] In Minister of Finance and Others v Gore NO11 the SCA dismissed the state’s
defence that the officials acted outside the scope of their employment. It held that
because the officials utilised their assigned roles to perpetrate deliberate fraud,
the state was vicariously liable for the resulting economic loss suffered by the
prejudiced tenderer.
[47] The issue is therefore not simply whether the alleged freelance representative
described himself as Telco’s representative; the issue is whether Telco or
Moodley, by words or conduct, created or permitted an appearance that he was
authorised to submit these transactions or to bind Telco in relation to them. That
8 Monzali v Smith 1929 AD 382 9 Glofinco v Absa Bank Ltd t/a United Bank [2002] JOL 10159 (SCA)
10 Africast v Pangbourne Properties Ltd [2013] 2 All SA 574 (GSJ)
11 Minister of Finance and Others v Gore NO 2007 (1) SA 111 (SCA); [2007] 1 All SA 309 (SCA)
enquiry is fact-specific: It calls for evidence regarding prior dealings, the
representative’s role, his access to Telco’s materials, communications between
the parties, any introductions or authorisations by Telco, the steps taken by
Sapor to verify his status, and the timing of Telco’s alleged discovery of the fraud.
The WhatsApp messages
[48] Sapor relies strongly on the WhatsApp messages. In these messages, Moodley
said, amongst other things, that he was at the church trying to sort matters out;
that “Mario our manager” was sorting out a problem with the client; that “Sean
and Thato” appeared to have caused problems in his business; and asked Sapor
to allow time to rectify the mess “the reps created”.
[49] Sapor says those communications establish either that the persons concerned
were Telco’s authorised representatives or that Telco subsequently adopted
what they had done. It says that Moodley’s statements demonstrate knowledge
of the transactions, acceptance that Telco would have to buy back the deals, and
an acknowledgment that the matter should be settled.
[50] The defendants contend that the messages recorded an effort to investigate and
address a fraudulent situation, not an informed admission of legal liability or an
acknowledgment of their responsibility for the fraud committed.
[51] The WhatsApp messages are certainly damaging to the defendants’ case. They
make the defence considerably less straightforward than the defendant’s counsel
proffered in argument; they provide substantial evidence that the relevant
persons were associated with Telco’s business and that Moodley regarded the
problem as one Telco was obligated to rectify. But they do not conclusively prove
the proposition for which Sapor uses them.
[52] While the messages may be capable of supporting the inference urged by Sapor,
they are also capable of a competing inference. Their meaning depends on their
complete context, Moodley’s prior knowledge and the circumstances under
complete context, Moodley’s prior knowledge and the circumstances under
which he discovered the fraud, determination of the identity of the persons
referred to, the relationship between Telco and the representatives. what they
were engaged to do, how transactions were ordinarily generated, what authority
they possessed, what Telco represented to Sapor concerning their authority and
how Sapor understood their status. In addition, evidence would need to be
adduced as to the purpose of the communications and the surrounding conduct
of the parties.
[53] I cannot determine, in summary proceedings, whether the statements made
amount to an admission, a representation giving rise to estoppel, or merely an
attempt to contain the consequences of suspected wrongdoing for which Teco
assumed responsibility. These are all quintessentially questions for trial.
Ratification
[54] Similar considerations apply to the question of ratification. Ratification entails an
informed and unequivocal adoption of an unauthorised act. Sapor says the
defendants accepted the funds, paid a third party and subsequently attempted to
“sort out” the Church transactions, as is evidenced from the WhatsApp
messages.
[55] The defendants say the funds were received and disbursed in good faith before
discovery of the fraud and that the relationship with the representative was
terminated once the fraud was uncovered. They say that they acted in good faith
before discovering the fraud and deny any unequivocal adoption of the
unauthorised acts.
[56] Ratification ordinarily requires adoption of the unauthorised act with the requisite
knowledge of the material circumstances. This requires an inquiry as to what
Telco and Moodley knew when the money was received, when portions were
paid to the representative, and when Moodley sent the WhatsApp messages?
[57] The fact that Moodley attempted to repair the transactions after becoming
suspicious may support ratification; but it may equally be consistent with an
innocent principal attempting to repair damage caused by a rogue
representative. Cross-examination may resolve the matter. It is arguable that
whether Telco had the necessary knowledge, whether its conduct was
unequivocally adoptive, and whether it can be characterised as ratification are
unequivocally adoptive, and whether it can be characterised as ratification are
matters requiring evidence. This thus also becomes an issue that supports
referral of the matter to trial.
The supplementary affidavit and the provisions of Rule 28(8)
[58] There is also a procedural complication regarding the reliance upon the
principles of estoppel and ratification. The defendants contend that these issues
were introduced for the first time through a supplementary affidavit and fall
outside the scope of a consequential adjustment under Rule 28(8).
[59] Generally, these are the type of issues raised in a replication following a plea in
which authority has been denied.
[60] The defendants rely upon City Square Trading 522 (Pty) Ltd v Gunzenhauser
Attorneys12 for the proposition that Rule 28(8) permits a plaintiff affected by an
amendment to make consequential adjustments, but does not permit the
supplementary affidavit to become a disguised reply to the opposing affidavit or
an opportunity to construct a materially new case in support of its application for
summary judgment.
[61] However, it must be borne in mind that summary judgment proceedings do not
generally permit the filing of a replying affidavit and there can be little doubt that
the issues relating to estoppel and ratification were raised pursuant to the
amendment to the description of the status of the person alleged to have
committed or have been party to the fraud in the defendant’s plea.
[62] Rule 28(8) provides:
“Any party affected by an amendment may, within 15 days after the amendment
has been effected or within such other period as the court may determine, make
any consequential adjustment to the documents filed by him …”
[63] Rule 32(4), by contrast, provides that no evidence may be adduced by the
plaintiff otherwise than by the affidavit contemplated in Rule 32(2).
[64] Ordinarily, therefore, there is no replying affidavit in summary judgment
proceedings. That is deliberate. The amended Rule 32 was structured so that
the plaintiff brings summary judgment only after delivery of the plea, and must in
its founding affidavit explain briefly why the defence as pleaded does not raise a
its founding affidavit explain briefly why the defence as pleaded does not raise a
12 City Square Trading 522 (Pty) Limited v Gunzenhausen Attorneys (Pty) Ltd and another [2022] JOL 52220
(GJ)
genuine issue for trial. The procedural formulation of the amended Rule therefore
gives the plaintiff one opportunity, knowing the defendant’s pleaded defence, to
address it in the Rule 32(2) affidavit.
[65] That general prohibition, however, creates an obvious difficulty when the
defendant changes its plea after the Rule 32 affidavit has already been filed. Rule
28(8) addresses precisely that situation.
[66] In City Square the defendant amended its plea after the summary judgment
application had been launched, and the plaintiff filed a further affidavit to deal
with the amended defence. Fisher J held that Rule 32(4) does not extinguish the
plaintiff’s rights under Rule 28(8) and that a plaintiff whose opponent amends its
plea is plainly a “party affected” by the amendment.
[67] The important qualification is that the adjustment must be consequential upon
the amendment. Fisher J’s formulation at para 29 is particularly useful: Rule 32(4)
prohibits material in the nature of a reply or rejoinder which is not consequential
upon the amendment. That final qualification is decisive. The judgment does not
say that any matter which resembles a reply is inadmissible; it says that Rule
32(4) prohibits replying or rejoinder material not consequential on the
amendment.
[68] Indeed, the purpose of Rule 28(8) would otherwise be defeated. If a defendant
were permitted materially to change its defence after summary judgment had
been launched while the plaintiff remained irrevocably tied to an affidavit drafted
against the former plea, the plaintiff could never perform the very function Rule
32(2)(b) requires of it - explaining why the pleaded defence actually before the
court does not raise a triable issue.
[69] That reasoning has subsequently been followed in ABSA Home Loans
Guarantee Company (RF) (Pty) Ltd v Erf 1404 Dainfern CC,13 where the court
held that a supplementary affidavit addressing an additional defence introduced
held that a supplementary affidavit addressing an additional defence introduced
13 Absa Home Loans Guarantee Company (RF) (Pty) Ltd and Another v ERF 1404 Dainfern CC and Others
(41403/2019) [2022] ZAGPJHC 490
by amendment was permissible because it was consequential and was not
merely an attempt to reply to the original opposition.
[70] Similarly, Mncube v Wesbank14 confirms that where the plea is amended after
summary judgment has been instituted, the plaintiff is an affected party under
Rule 28(8) and may adjust the Rule 32 affidavit, provided the adjustment is truly
consequential.
[71] The more recent Gotora NO v FirstRand Bank15 also confirms the distinction;
supplementary affidavits in summary judgment proceedings are generally
exceptional, but City Square Trading represents the particular case where an
amended plea activates Rule 28(8).
[72] That substantially answers the defendants’ procedural objection
[73] City Square Trading is in point: In the defendants’ original resisting papers, the
individual implicated in the fraudulent church transactions had been
characterised as an employee of Telco. In their supplementary affidavit of 23 July
2025 the defendants expressly stated that this was factually inaccurate and
sought to change that position. The individual, they said, was not an employee,
but someone engaged from time to time as a “freelance representative” operating
independently.
[74] The defendants now alleged that the freelancer:
a. acted entirely outside his mandate;
b. acted without the defendants’ knowledge, authorisation or consent;
c. was not ratified by them;
d. had his engagement terminated immediately upon discovery of the fraud;
and
e. could not generate vicarious or contractual liability for Telco.
14 Mncube v Wesbank [2023] ZAGPJHC 895 15Gotora N.O. and Others v Firstrand Bank Limited t/a First National Bank [2026] ZAGPJHC 563
[75] Most significantly, the proposed substituted paragraph 7 expressly alleged that
he possessed neither actual nor ostensible authority to bind Telco.
[76] That case was then incorporated into the amended plea. The amended plea says
that the individual was not an employee but a freelance representative, that the
fraudulent transactions were orchestrated by him without the defendants ’
knowledge, consent or authority, and that the defendants therefore bore no
liability for the transactions.
[77] Thus the amendment did not merely correct “employee” to “freelancer” ; it
introduced a material juridical proposition, namely that notwithstanding that this
person sourced and submitted the transactions through Telco’s business, he had
no authority - actual or ostensible - to bind Telco, and Telco never adopted what
he had done. That substantially changed the defence confronting the plaintiff.
[78] This explains why estoppel is usually pleaded in a replication. The Constitutional
Court’s discussion in Makate v Vodacom (Pty) Ltd 16is directly relevant. It
recognises the conventional pleading sequence: Where the plaintiff knows from
the outset that actual authority does not exist and relies upon ostensible
authority, the relevant case may appropriately be pleaded initially. But where the
plaintiff alleges authority and the defendant thereafter denies authority in its plea,
ostensible authority or estoppel is ordinarily raised in replication. As the Court
explained, if the plaintiff pleaded actual authority and the defendant then pleaded
its absence, the plaintiff could rely upon estoppel in replication.
[79] That is of particular relevance to the matter before me: It would be procedurally
anomalous to criticise Sapor for not anticipating in its original summary judgment
affidavit an estoppel case which, according to ordinary pleading principles, arises
responsively when authority is denied.
[80] The defendants themselves created the need for that response when they
[80] The defendants themselves created the need for that response when they
amended their case from one involving an employee to one involving an
independent freelancer who allegedly possessed no authority of any kind.
16 2016 (4) SA 121 (CC)
[81] The purpose of the supplementary affidavit is significant. Badenhorst expressly
says that the affidavit is filed because the defendants amended their plea after
the summary judgment application, and that its purpose is to deal with the
amended pages rather than to repeat the original cause of action. Badenhorst
than goes on to plead estoppel, and alternatively ratification to the amended
pages on the basis already outlined above. That seems to me entirely
consequential within the meaning of Rule 28(8).
[82] The defendants submit that the amendment introduced “ no new facts or
defences” and that estoppel and ratification are therefore impermissible new
material. This cannot be the case. Their supplementary affidavit itself says that
the distinction between employee and freelancer is “material”, because it means,
according to them, that Telco cannot be held vicariously liable. It also adds that
the freelancer acted outside his mandate, lacked actual or ostensible authority,
and that the defendants did not ratify his acts.
[83] It is impermissible for the Defendants to simultaneously contend that the change
was so material that it destroys Telco’s liability; but at the same time that it was
so immaterial that Sapor was not entitled to respond to it.
[84] Indeed, the defendants’ proposition would permit a defendant, after seeking the
summary judgment application, to amend its plea materially by denying authority
and then invoke Rule 32(4) to prevent the plaintiff from addressing that new
defence. That would be contrary both to City Square Trading and to the patent
intention behind the amended Rule itself.
[85] Accepting the affidavit does not mean Sapor necessarily establishes estoppel.
There is at least one potential weakness in the pleaded estoppel case. Paragraph
22.2.1 relies in part on the freelancer having identified himself as an authorised
representative. Ordinarily an agent cannot manufacture his own ostensible
representative. Ordinarily an agent cannot manufacture his own ostensible
authority merely by asserting that he possesses it. The representation must
ultimately be attributable to the principal. That is the point made in Glofinco and
the other agency authorities relied upon by the defendants. The defendants’
counsel correctly emphasises that a representation sufficient for estoppel must
be rooted in the words or conduct of the principal.
[86] However, Sapor does not rely only upon the freelancer’s own assertion. It also
relies on Telco’s conduct, that is, its acceptance of the transactions, receipt of
the proceeds, onward payments, Moodley ’s subsequent communications
referring to the persons involved as “reps”, and his attempts to rectify the church
transactions.
[87] Whether those circumstances establish ostensible authority or estoppel is a
merits question. It is not a reason to strike the allegations from the supplementary
affidavit.
[88] The position concerning ratification is perhaps stronger; the amended defence
expressly says there was no ratification.
[89] Once that allegation is made, Sapor must surely be entitled under Rule 28(8) to
point to facts which it says establish the contrary. Again, whether the facts
actually amount to ratification depends on knowledge and unequivocal adoption.
But the issue itself was directly generated by the amendment.
[90] I therefore consider the defendants’ argument that ratification is an impermissible
“new cause of action” to be conceptually incorrect. Ratification is not a new cause
of action; it is a juridical answer to the amended contention that the person who
generated the transactions lacked authority to bind Telco.
[91] Similarly, estoppel is ordinarily not itself a cause of action; it operates to prevent
a party from relying upon a state of affairs inconsistent with a representation upon
which another acted.
Conditions precedent
[92] The defendants rely on clause 3.1. They contend that the procurement of
equipment by Sapor was subject to the conclusion of valid agreements with the
intending users, that the Church documents were forged, and that no valid
agreements with the Churches came into existence. Sapor answers that the
relevant agreements were, at most, voidable, that the defendants have not
instituted a collateral challenge seeking to set them aside, and that payment was
in fact made to Telco.
[93] Whether the condition precedent in clause 3.1 was fulfilled depends in part on
the legal effect of the Church documentation. It also depends on the correct
construction of the clause. It may regulate when Sapor becomes bound to
purchase equipment from Telco, it does not necessarily govern the availability of
Sapor’s remedy where Telco’s warranties relating to the proposed transaction
are alleged to have been breached. Conversely, Telco may seek to show that
the condition was a substantive precondition to triggering of its obligation to buy
back the transactions.
[94] This issue cannot be disposed of by saying that payment was made. Payment
may be evidence that Sapor treated the conditions as satisfied , it does not
conclusively establish that a genuine end-user agreement was concluded. Nor
does the defendants’ reliance on the clause itself necessarily provide a complete
defence to a claim for breach of Telco’s separate representations and warranties.
This is an issue of construction linked to disputed facts.
[95] Clause 3.1 does not make the entire Supplier Agreement conditional upon the
valid conclusion of an end-user agreement. It regulates whether a particular
purchase of equipment by Sapor from Telco becomes binding. The real question
is whether failure of the clause 3.1 condition precedent also prevents Sapor from
enforcing the Supplier Agreement’s warranties and clause 7 remedies where the
very reason the condition was apparently satisfied was false information or
forged documentation furnished through the supplier’s referral process?
[96] Clause 4.3.2 is directed precisely at the risk which materialised. This clause
contains Telco’s warranty that documents furnished by it to Sapor concerning the
referral of an intending user, or any proposed agreement to be entered into, or
entered into, by Sapor with that intending user, are genuine, true and correct in
all respects. It also warrants, to the stipulated standard, the genuineness of
all respects. It also warrants, to the stipulated standard, the genuineness of
signatures and the authority of signatories. The breadth of that formulation is
important: It does not apply only to an ultimately valid end -user contract; it
expressly encompasses documents concerning a “proposed agreement to be
entered into”.
[97] That makes considerable commercial sense. The warranty operates at the
referral and approval stage - before Sapor can know whether the apparent end-
user documents are genuine.
[98] If the defendants’ construction of clause 3.1 were accepted, clause 4.3.2 would
lose much of its practical operation in precisely the circumstances in which it is
most needed. Sapor’s case is that Telco warranted the genuineness of
documents and signatures. The signatures were forged. The defendants then
rely on the forgery to say that no end-user agreement existed and therefore that
the condition precedent was not fulfilled.
[99] Sapor’s case is that Telco warranted the genuineness of documents and
signatures. The signatures were forged. The defendants then rely on the forgery
to say that no end-user agreement existed and therefore that the condition
precedent was not fulfilled.
[100] But if the supplier’s breach of the documentary warranty is what caused the
apparent satisfaction of the condition precedent, the supplier cannot ordinarily
rely upon the consequences of that very defect to render the contractual warranty
and remedy nugatory.
[101] The argument raised by the defendants is circular and commercially implausible
as it would make the warranty least effective where the breach of the warranty is
most serious. Indeed, the defendants’ construction would allow the breach itself
to defeat the remedy.
[102] Properly construed in the circumstances, Clause 3.1 protects Sapor from
becoming bound to purchase equipment before there is an end -user rental
transaction. It was not designed to protect the supplier from liability where false
documentation submitted through the supplier’s own referral channel falsely
represented that the end-user transaction existed. That interpretation gives
commercial efficacy to both clauses 3 an 4.
[103] Clause 3.4 substantially provides that where Sapor enters into an agreement
pursuant to a supplier referral, the condition precedent is regarded as fulfilled
pursuant to a supplier referral, the condition precedent is regarded as fulfilled
and an equipment sale is deemed concluded between Sapor and the supplier.
[104] There is admittedly a textual complication: if the church contracts were forged,
can Sapor properly be said to have “entered into an agreement” with the
churches?
[105] At the level of ordinary consensual contract formation, perhaps not.
[106] But clause 3.4 cannot be interpreted in isolation from clause 4.3.2. The latter
expressly imposes upon Telco warranties concerning documents supplied for
proposed agreements. Thus the Supplier Agreement contemplates the risk that
Sapor will act upon documents submitted in relation to a transaction which later
proves defective.
[107] Moreover, once estoppel or ratification is taken into account, the defendants\
ability to rely upon the absence of a valid underlying transaction becomes still
weaker.
[108] If Telco is precluded from denying the representative ’s authority, or if it
subsequently adopted the transactions, it is difficult for it simultaneously to
assert, as against Sapor, that the transactions cannot count for purposes of the
contractual machinery because they originated through unauthorised conduct.
[109] The summons invokes clauses 7.3.3–7.3.6. Clause 7.3.3 provides that, upon a
breach by the supplier of any warranty, indemnity, condition or term of the
Supplier Agreement, Sapor may require the supplier to purchase the contract in
respect of which the breach occurred. Clause 7.3.4 determines the consideration
by reference to the amount collectible under the relevant contract. That is crucial:
The trigger is not expressed as, “provided that every condition precedent in
clause 3.1 has been validly fulfilled”. On the contrary, the trigger is a breach of a
warranty, indemnity, condition or term of the Supplier Agreement . And the
pleaded breach - forged documentation and false signatures - falls squarely
within the subject matter of clause 4.3.2.
[110] The better interpretation is therefore that clause 7 provides the remedial
machinery when a referred transaction turns out to have been defective because
machinery when a referred transaction turns out to have been defective because
a supplier warranty was untrue.
[111] But it must be conceded that there is some inconsistency in the drafting of the
Supplier Agreement. Clause 3.1 contemplates a genuine end-user agreement as
a condition precedent to an individual equipment purchase. Clause 7.3.5
contemplates delivery or cession of the relevant contract back to the supplier
upon payment of the buy-back consideration. The defendants say that an
agreement founded on forged signatures cannot meaningfully be ceded.
[112] But clause 7.3.5 appears to describe the reciprocal consequence of the buy-back
remedy, not to create a further prerequisite to the supplier’s liability for breach.
Where the “contract” proves unenforceable because the documents supplied
through the referral were fraudulent, Sapor may obviously be unable to transfer
an enforceable claim against the supposed end-user. But that is precisely the
loss which the supplier warranty protects Sapor against. Otherwise, the more
worthless the underlying contract, the less effective the contractual warranty
would become.
[113] That cannot readily have been the commercial purpose of the agreement.
The fact that the equipment was not delivered
[114] The defendants also rely on the admitted fact that no equipment was delivered
or installed. Again, however, this is not naturally a defence to clause 4.3 liability.
Clause 4.3.4 itself warrants that the equipment was properly and fully delivered
and installed. The summons expressly pleads breach of that obligation in
addition to the false-document warranty.
[115] If non-delivery defeated the remedy altogether, clause 4.3.4 would be remarkably
ineffective; the supplier could breach the very warranty that equipment had been
delivered and then say that because equipment was not delivered, the
transactional conditions were not satisfied and therefore no remedy lies.
[116] The payment to Telco
[117] This is not a case in which Sapor merely processed a fraudulent application but
never acted upon it. Sapor actually paid Telco. Telco admits receiving R151
never acted upon it. Sapor actually paid Telco. Telco admits receiving R151
551.16 in relation to the church transactions and thereafter admits making
transaction-specific onward payments to the freelance representative.
[118] That means the commercial transaction contemplated by the Supplier
Agreement was in fact implemented between Sapor and Telco. The defendants
cannot convincingly characterise it as though no transactional relationship ever
arose at all. The factual implementation of the end-user agreement is significant
when construing clause 3.1 alongside the later warranty and remedy provisions.
The distinction between a condition precedent and a warranty
[119] A genuine suspensive condition prevents the conditional obligation from
becoming enforceable until the uncertain future event occurs. If clause 3.1 were
the only relevant provision and no end-user contract were ever concluded, Telco
could plausibly say no obligation arose under the particular equipment purchase.
[120] But Sapor’s claim does not depend simply upon enforcing that equipment
purchase as if nothing had gone wrong; it relies upon a separate, antecedent
warranty contained in the Supplier Agreement concerning the truth and
genuineness of the information used to procure the transaction. That warranty
does not logically depend on the success of the transaction; on the contrary, its
purpose is to regulate the risk that the transaction is defective. That is why I
consider the defendants’ suspensive-condition argument to misidentify the
obligation which Sapor seeks to enforce.
[121] Clause 3.1 provides that purchases by Sapor from the supplier “shall only be
binding on SAPOR” if the prescribed requirements are met. The clause is cast
as a limitation upon when Sapor becomes bound to purchase equipment from
the supplier; it does not constitute an exclusion of the supplier’s warranties and
liabilities whenever the transaction turns out to contain defective or fraudulent
documents. Indeed, a condition imposed for Sapor’s protection should not lightly
be transformed into an immunity for Telco from its independent warranties. That
is particularly so where Telco is attempting to invoke the absence of a valid end-
is particularly so where Telco is attempting to invoke the absence of a valid end-
user agreement after having itself accepted payment pursuant to the purported
transaction.
The commercial purpose of the Supplier Agreement
[122] The commercial purpose of the Supplier Agreement is of some relevance. In the
preamble to the agreement its purpose is recorded, and that purpose is that Telco
refers users to Sapor for financing, Sapor concludes finance agreements with
those users, and Telco supplies the equipment.
[123] Clause 4.3.2 is directed squarely at dealing with the origin of the commercial risk
Sapor inevitably faces in concluding the end-user agreement. The the obvious
credit risk that the end-user fails to honour its finance arrangement and that the
customer or the supporting documentation are not genuine. The clear intention
behind clause 4.3.2 is for Sapor to transfer the latter risk to Telco. In terms hereof,
Telco warrants the truth and genuineness of documentation emanating from the
supplier-referral process.The defendants’ construction would shift that
origination risk back to Sapor notwithstanding the express warranty.
Due diligence
[124] The defendants argue that Sapor was required independently to verify the
churches and should have discovered the fraud. They contend that Sapor failed
to undertake basic due diligence in that it did not verify the purported church end-
users, the identities and authority of the signatories, the supporting documents
or actual delivery of the equipment. They place reliance on the due-diligence
obligations arising under the Financial Intelligence Centre Act and the FIC ’s
Guidance Note 7A. They submit that Sapor’s own failures caused or materially
contributed to its alleged loss.
[125] The plaintiff responds that an alleged failure to mitigate was not properly pleaded,
that no contractual source for such a duty has been identified, and that Telco’s
contractual warranties cannot be displaced by a general allegation that Sapor
should have detected the fraud. It also relies on the communications in which it
says the defendants undertook to address the difficulty.
[126] An express warranty is ordinarily an allocation of contractual risk. Unless the
[126] An express warranty is ordinarily an allocation of contractual risk. Unless the
agreement makes Sapor’s independent verification a qualification upon Telco’s
warranty, negligent verification does not simply extinguish the warranty.
[127] The defendants’ reliance on “mitigation” is not, in its present formulation, a clearly
established complete answer to a contractual claim. Mitigation concerns steps
reasonably available after a breach or loss to reduce loss. An allegation that
Sapor failed to verify the transaction before payment more directly raises
questions of contractual risk allocation, causation, reasonable reliance for
estoppel and, potentially, a separate claim. Likewise, a regulatory duty under
FICA does not without more create a private-law defence to a claim under a
contract.
[128] Moreover, Moodley himself seems to have accepted Telco’s buy-back obligation.
He did not allege that no equipment purchase had ever come into existence;
instead in his WhatsApp messages he spoke of fixing and rectifying the
transactions, said Sapor need not be concerned, and referred to the
representatives as having created the problem within his business. There was
also a later message in which Moodley responded to the buy-back figures by
saying that they appeared “excessively high versus payout amount” and
proposed discussing them. He did not then take the position that the contractual
buy-back mechanism was wholly inapplicable because clause 3.1 had never
been fulfilled.
[129] That is not necessarily a contractual admission decisive by itself, but it diminishes
the bona fides of the later clause 3.1 defence.
[130] Nonetheless, the alleged absence of verification may be material in more than
one respect. It may bear on whether Sapor reasonably relied on any alleged
appearance of authority. It may bear on causation if Sapor’s claim is ultimately
one for damages rather than a fixed contractual repurchase amount. It may also
be relevant to the meaning and application of the contractual provisions. The
evidence required to resolve these questions has not been ventilated. That does
not mean that the due-diligence allegation itself necessarily defeats the claim; it
not mean that the due-diligence allegation itself necessarily defeats the claim; it
does mean that it cannot be dismissed at this stage as having no possible
bearing on the matters raised.
The fraudulent nature of the end-user agreements and the liability to buy back liability
[131] The question is whether the fraudulent end-user rental agreements are incapable
of supporting the clause 7 calculation?
[132] Clearly, as between Sapor and the churches, a forged signature may well mean
that the churches never consented and cannot be held liable under the supposed
rental agreements. The principle that these contracts are valid until set aside set
out in Pepkor does not address the case where the signature of a supposed
contracting party who never assented at all was forged.
[133] But that does not resolve Telco’s liability. Sapor is not asking the court to enforce
the rental agreements against the Churches; it is simply using the contractual
rental schedules to determine the measure of Telco’s buy-back liability under the
separate Supplier Agreement.
[134] But there is contrary interpretation that requires consideration before a decision
is made whether to grant summary judgment. Clause 7.3.3 requires Telco to
“purchase the contract”. Clause 7.3.4 measures the price by what is “collectible
under the relevant contract”. If the church signatures were forged, there is no
enforceable contract and therefore nothing collectible under it. The amount
collectible is arguably zero.
[135] This argument considerably stronger than merely invoking clause 3.1.
[136] But I have that it would prevail when the agreement is read as a whole. The
words “collectible under the relevant contract” establish a valuation formula. They
should not be interpreted so literally that a supplier whose breach of warranty
made the contract worthless can say that its buy-back obligation is therefore
zero. Such an interpretation would invert the contractual risk allocation. The
sensible and businesslike construction is that the buy-back price is calculated
by reference to the contractual rentals which would have been collectible had the
supplier’s warranties been true, and do not depend on the enforceability of the
end-user agreement.
end-user agreement.
[137] This is also consistent with the settlement calculations Sapor prepared.
[138] The very reason for a buy-back obligation is often that the underlying asset or
receivable is defective.
[139] When the supplier warrants the integrity of the underlying transaction and
promises, upon breach, to buy it back at the outstanding contractual value, it
would defeat the bargain to value the defective receivable at zero precisely
because the warranted defect has materialised.
[140] Viewed that way, clause 7.3.4 is not a market-value provision; it is a contractual
formula for restoring Sapor to the position represented by the apparently valid
rental stream. That interpretation also explains why the claimed amount exceeds
the amount paid to Telco.
The certificates and quantum
[141] Sapor relies on certificates of balance which reflect a total indebtedness of R218
104.78, comprising R135 772.84 for the St Augustine’s transaction and R82
331.94 for the St Francis transaction. It submits that the certificates are
contractually agreed to constitute prima facie evidence and that the defendants
have failed to advance a cogent evidential basis to refute them.
[142] The governing principles are not in dispute. In Senekal v Trust Bank of Africa
Ltd,17 the Appellate Division recognised that a certificate may, by agreement,
constitute prima facie proof of the indebtedness certified. In SASFIN Bank Ltd v
Makatsang Cleaning Services (Pty) Ltd,18 the Court held that a certificate may
become sufficient proof when no evidence is presented to disturb it. That does
not mean that every challenge will suffice; but a concrete factual challenge may
require a trial.
[143] The defendants identify particular matters said to disturb the certificates. They
allege that the documentation and underlying transactions were fraudulent, that
no equipment was delivered or installed, that Telco received R151 551.16 only,
and that the difference of R66 553.62 between that figure and the total claim is
not adequately explained. They additionally contend that the certificates do not
satisfactorily explain the calculation of R13 294.38 as arrears or the attribution of
R204 810.40 to future payments.
R204 810.40 to future payments.
17 Senekal v Trust Bank of Africa Ltd 1978 (3) SA 375 (A) 18 Sasfin Bank Limited and Another v Makatsang Cleaning Services (Pty) Ltd and Others (5691/2019) [2021]
ZAFSHC 6
[144] The defendants place considerable emphasis on the fact that Telco received only
R151 551.16 from Sapor and say that the difference between that amount and
R218 104.78 is unexplained. Their amended plea expressly alleges that only
R151 551.16 was received and that the balance claimed is unsupported by
evidence of loss or performance.
[145] that argument proceeds, however, from the wrong contractual measure: Sapor
is not suing simply for repayment of the capital amount advanced to Telco; its
pleaded cause of action invokes the buy-back mechanism in clauses 7.3.3–7.3.6
of the Supplier Agreement.
[146] Clause 7.3.3 entitles Sapor, upon breach of a warranty or other term of the
Supplier Agreement, to require the supplier to purchase the relevant contract
within 45 days. Clause 7.3.4 then specifies the price; the consideration payable
is the amount collectible under the relevant contract purchased as at the date
Sapor receives the consideration, together with specified costs and expenses.
Clause 7.3.5 provides that upon payment the contract is delivered/ceded to the
supplier, and clause 7.3.6 requires the supplier to uplift the equipment at its own
cost.
[147] Thus the contractual measure is not how much Telco originally received from
Sapor; it is what amount remained collectible under each rental contract when
Sapor invoked the buy-back remedy. That is a materially different inquiry.
[148] The pleaded amount precisely corresponds with the contractual election made
by Sapor. The summons pleads breach of clauses 4.3.2 and 4.3.4: Telco
warranted, amongst other things, that the documents supplied in respect of
intending users were genuine and correct, that signatures were genuine and
authorised, and that the equipment had been properly delivered and installed.
Sapor then expressly pleads its election under clauses 7.3.3-7.3.6 and claims
R135 772.84 rental that would have been accrued under the St Augustine’s
Catholic Church and R82 331.94 that would have from the St Francis Church,
Catholic Church and R82 331.94 that would have from the St Francis Church,
totalling R 218 104.78.
Are these amounts liquidated?
[149] The amounts can be precisely calculated from the end-user rental agreements.
[150] With regard to St Augustine, the amount of R135 772.84 claimed can be
reconstructed exactly inasmuch as the St Augustine’s settlement calculation
records a monthly rental of R2 000, with 56 rentals remaining, and no escalation.
The calculation records an arrears component of R6 972.84. This accounts for
56 rental payment of R2000 per month and VAT at 15 percent and arrears of
R6 972.84.
[151] The same applies to the St Francis end -user agreement. The St Francis
worksheet sets out the future rentals in three escalation bands, namely, 9 rentals
at R1 800, 12 rentals at R1 980 and 12 rentals at R2 178. It records arrears of
R6 321.54.
[152] The outstanding future rentals can be calculated, having regard to the arrears
and VAT as totalling R76 010.40 without any extrinsic evidence. Both amounts
can thus be regarded as liquidated and not simply as unliquidated damages. The
figure in the settlement calculation is accordingly internally verifiable and
mathematically consistent with the rental schedule.
[153] There is thus no residual amount as claimed by the defendants. The total of the
amount that would have been due by St Augustine of R135 772.84 and that by
St Francis of R82 331.94 accounts for the total amount claimed of R218 104.97;
there is no unexplained residual amount.
[154] The certificate of indebtedness independently confirms the same figure.
[155] The defendants’ principal response is that it only received R151 551.16. But that
does not answer clause 7.3.4. Once the contractual buy-back obligation is
triggered, the consideration is not restricted to what Telco received. It is the
amount collectible under the rental contract at the relevant date.
[156] Sapor financed an income-producing rental stream. If Telco breaches warranties
which cause that rental stream to fail, the contractual buy-back provision restores
Sapor by requiring Telco to purchase that remaining contractual stream.
[157] The defendants correctly rely upon Senekal v Trust Bank for the proposition that
a certificate which is prima facie evidence can be rebutted. Their heads similarly
rely upon Sasfin Bank v Makatsang Cleaning Services to say that prima facie
evidence becomes sufficient only where it is not displaced. That proposition is
unobjectionable.
[158] But the question is whether these defendants have actually disturbed the prima
facie proof of quantum. They have not. Instead, they rely principally upon the fact
that Telco received only R151 551.16. That does not rebut a calculation based
upon clause 7.3.4.
[159] The certificate contains prima facie evidence against Moodley. The guarantee
expressly contains a certificate clause providing that a certificate under the hand
of an authorised person is, on its face, proof of the supplier’s and/or guarantor’s
indebtedness. But vis-à-vis Telco the Supplier Agreement itself provides the
substantive formula in clause 7.3.4, and the settlement schedules demonstrate
the calculation.
[160] There is an additional contemporaneous communication in which Moodley says,
after reading the settlement schedules in which he complains that the figures
reflected were “excessively high verses payout amount.” A statement that the
figures are too high, without more, does not satisfy the requirements in order to
oppose summary judgment set out above requiring that a full explanation be
provided for a denial; this is particularly so where the plaintiff has provided the
rental schedules and the calculation is objectively reproducible. The defendants
would need to identify some factual or computational basis for disputing the
amount claimed.
Are the defences bona fide?
[161] What remains is to determine whether, notwithstanding the conclusions reached
above concerning the apparent strength of the plaintiff’s case, the defendants
have disclosed a bona fide defence of the kind contemplated in Rule 32(3)(b) at
have disclosed a bona fide defence of the kind contemplated in Rule 32(3)(b) at
this stage of the inquiry and for summary judgment purposes. That enquiry is
important because the conclusion that one party’s case appears considerably
stronger on the papers is not equivalent to a conclusion that the opposing case
is a sham.
[162] The principles are well established. In Maharaj the Appellate Division held that a
defendant resisting summary judgment is required to disclose fully the nature
and grounds of the defence and the material facts upon which it rests. “Fully”
does not mean that the defendant must prove the defence on a balance of
probabilities. The disclosure must instead be sufficient to satisfy the court that, if
the facts alleged are established at trial, they would constitute a defence which
is bona fide and good in law. Breitenbach similarly recognises that the court may
have regard to the manner in which the defence is disclosed in determining its
bona fides, particularly where the allegations are unnecessarily bald, vague or
sketchy.
[163] Those principles survive the amendment of Rule 32. In Tumileng Trading
CCinns-Ward J emphasised that the enquiry remains whether the defence
pleaded is bona fide rather than a sham. The court is not charged with deciding
its substantive merits or prospects of eventual success. The fact that the plea
discloses something which may loosely be described as an issue for trial is not
itself sufficient; the defence must genuinely be advanced. Conversely, where it
is genuinely advanced, the summary judgment court should not resolve the
merits of the factual dispute under the guise of determining bona fides.
[164] The Supreme Court of Appeal has subsequently confirmed that approach in
Cohen NO and Others v D.19 The Court held that a defendant need only disclose
a genuine, as opposed to sham, defence; prospects of success are irrelevant,
and if the defence is legally cognisable in the sense that it would constitute a
defence if proved at trial, summary judgment s hould ordinarily be refused.
Significantly, Cohen itself concerned a defence which required interpretation of
a trust instrument. The SCA held that the interpretation advanced by the
a trust instrument. The SCA held that the interpretation advanced by the
defendants could not properly be characterised as unreasonable or mala fide.
a. Contractual interpretation and the need for contextual evidence
19 Cohen NO and Others v D (368/2022) [2023] ZASCA 56 (20 April 2023) paras 22-27
[165] The caution sounded in Cohen assumes particular significance in the present
case because an important component of the dispute concerns the proper
interpretation and interaction of clauses 3, 4 and 7 of the Supplier Agreement.
As explained above, the plaintiff’s construction is persuasive. It gives the
warranties concerning the genuineness of the documentation and delivery of the
equipment substantial commercial efficacy and avoids the seemingly anomalous
result that the supplier might rely upon the very falsity constituting the breach of
warranty to contend that the contractual remedy never arose.
[166] But the modern approach to interpretation requires me to distinguish between
concluding that the construction advanced by the plaintiff is more persuasive
one and concluding that the defendants’ competing construction is not genuinely
advanced. In University of Johannesburg v Auckland Park Theological Seminary
and Another,20 the Constitutional Court confirmed that interpretation is a unitary
exercise in which text, context and purpose are cumulatively considered. Context
is relevant whether or not the language appears ambiguous. The factual matrix,
purpose of the agreement, circumstances surrounding its conclusion and
material known to those responsible for its production may all legitimately bear
upon interpretation.
[167] Of particular relevance is the Constitutional Court’s observation that parties will
frequently have to adduce evidence establishing the context and purpose of
contractual provisions. The Court nevertheless cautioned that interpretation
remains a question of law for the court and that contextual evidence cannot be
used without limit to alter the written agreement. Where reasonable minds may
differ concerning the admissibility of contextual evidence, however, the unitary
approach favours its admission, leaving its weight to be assessed thereafter.
[168] The approach taken by the Constitutional court is important to the matter before
[168] The approach taken by the Constitutional court is important to the matter before
me. The defendants contend, in substance, that clause 3 establishes the
prerequites before an individual equipment purchase and corresponding
repurchase obligation can arise, that no genuine end-user agreement ever
existed because the signatures were forged, and that the language in clause 7
20 2021 (6) SA 1 (CC)
concerning the purchase of “the contract” and the amount “collectible” under it
presupposes an existing contract capable of enforcement. The plaintiff, on the
other hand contends that clauses 4 and 7 allocate to Telco the very risk that a
referred transaction proves to be fictitious (as the signatures of the end-user were
forged) or is unenforceable due to fraud.
[169] Although I prefer the interpretation proffered by Sapor, which construction will
ultimately prevail may more properly be determined by evidence concerning the
commercial setting in which the Supplier Agreement operated, including the
ordinary process by which transactions were referred, the respective functions of
Telco and Sapor in verifying prospective users, the role ordinarily performed by
Telco’s representatives, the commercial purpose of the documentary warranties,
and whether the repurchase mechanism was intended to encompass a
transaction which appeared to exist because of documentation subsequently
discovered to have been forged.
[170] The existence of potentially relevant contextual evidence does not mean that
every dispute about contractual interpretation must be referred to trial.
Interpretation remains for the court and a defendant cannot avoid summary
judgment merely by asserting that evidence might later emerge to support its
version. But where a competing interpretation is reasonably tenable and the
proper contextual matrix has not yet been fully established, the court should be
slow to decide the issue finally merely because one construction presently
appears preferable.
b. Estoppel and ostensible authority
[171] Similar caution is required in relation to the plaintiff’s reliance upon estoppel or
ostensible authority. In Makate v Vodacom (Pty) Ltd,21 the Constitutional Court
explained that where actual authority is alleged and subsequently denied, the
third party may plead estoppel by way of replication. The Court identified the
third party may plead estoppel by way of replication. The Court identified the
factual components of estoppel in the agency context, including a representation
21 Makate v Vodacom (Pty) Ltd 2016 (4) SA 121 (CC)
attributable to the principal, reasonable reliance upon it and consequent
prejudice.
[172] The importance of those requirements in the present matter is that the
contemporaneous WhatsApp communications, although strongly supportive of
the plaintiff’s case, do not necessarily resolve every element of estoppel.
Moodley’s references to “our manager”, “these reps” and persons who had
caused problems “in my business”, coupled with his repeated undertakings to
rectify the transactions, provide powerful evidence that the persons concerned
operated within Telco’s commercial structure. They materially undermine the
later attempt to portray the person first described as an employee as a freelancer.
The difficulty is that these WhatsApp messages were sent ex post facto and did
not constitute a representation to Sapor by Telco that the person who committed
the fraud was authorised to act on its behalf.
[173] The estoppel enquiry concerns, amongst other things, what representation
attributable to Telco existed before Sapor acted to its prejudice, what Sapor
understood the representative’s authority to encompass, whether that
understanding was induced by Telco rather than merely by the representative
himself, and whether Sapor reasonably relied upon that representation when it
financed the transactions.
[174] Makate emphasises that a representation founding estoppel must emanate from
the principal, whether through words or conduct, and that the representee must
reasonably have acted upon it to its prejudice. It also recognises that the
appearance of authority may arise from the position in which the principal has
placed the supposed agent and the course of dealing which the principal has
permitted. These are inherently fact based enquiries.
[175] The WhatsApp communications appear principally to concern events after
difficulties with the Church transactions had arisen. They may permit a powerful
inference concerning the antecedent relationship between Telco and its
inference concerning the antecedent relationship between Telco and its
representative, but they do not necessarily disclose the entire course of dealing
existing when Sapor decided to advance the funds. Evidence from the persons
involved concerning the ordinary referral process and the parties ’ previous
dealings may therefore legitimately bear upon the question.
c. Ratification
[176] Ratification presents a related difficulty. The plaintiff relies upon Telco’s receipt
of the transaction proceeds, its onward payments to the freelance representative,
Moodley’s personal intervention at the churches and his repeated assurances
that Telco would resolve the problem. Those circumstances provide substantial
evidence from which ratification might ultimately be inferred.
[177] The defendants’ answer is that the money was received and disbursed before
the fraud was discovered and that, once the true position became known, the
representative’s relationship with Telco was terminated. As indicated earlier, that
version is inadequately particularised in important respects. The precise
chronology of discovery, payment and subsequent conduct has not been
satisfactorily explained.
[178] Yet the weakness of the explanation does not necessarily answer the distinct
question whether ratification has been conclusively established. That enquiry
depends upon what Telco knew when the relevant acts occurred and whether its
subsequent conduct, with knowledge of the material facts, objectively manifested
an adoption of the unauthorised transactions. Whether Moodley’s assurances
that he would “sort out” or “rectify” the transactions constituted adoption, rather
than an attempt to mitigate the consequences of a fraud committed through
Telco’s business, is an inference which may properly be informed by oral
evidence and cross-examination.
d. The analogy between estoppel, ratification and rectification
[179] The approach adopted in cases concerning rectification is instructive, although
rectification itself is not a defence presently advanced. In Lombaard v Droprop
CC and Others,22 the SCA dealt with detailed factual allegations that the written
agreement did not reflect the parties ’ true agreement. It held that those
agreement did not reflect the parties ’ true agreement. It held that those
allegations could not simply be rejected on the papers and recognised the
22 2010 (5) SA 1 (SCA)
appropriateness of oral evidence where a genuine dispute existed concerning
the true contractual position. The Court reiterated that a referral to oral evidence
presupposes a genuine dispute of fact; oral evidence is not available merely to
enable a litigant to search for a defence which has not been properly disclosed.
[180] [ ] Lombaard is relevant by analogy because disputes concerning rectification,
estoppel and ratification frequently turn upon communications, knowledge,
intention, reliance and the inferences properly to be drawn from conduct. The
fact that such an issue ordinarily benefits from oral evidence does not relieve the
party relying upon it of the obligation to establish a genuine dispute. But where
that threshold has been crossed, a court should be cautious about finally
resolving competing inferences from affidavits alone.
e. Assessment of bona fides
[181] There are formidable difficulties in the defendants’ case. The initial description of
the person implicated in the fraud as an employee was subsequently altered to
that of a freelance representative. Moodley’s contemporaneous communications
describe the relevant persons as “reps”, place their activities within his business
and involve Telco’s manager and Moodley personally in attempts to rectify the
transactions. Telco admittedly received the plaintiff ’s money and made
transaction-specific onward payments to the representative. The defendants’
attack upon the quantum is substantially answered by the settlement
calculations, which reconcile with the contractual rental schedules and the
certificates of indebtedness. The FICA and due-diligence arguments do not,
without more, displace Telco’s express contractual warranties.
[182] Those considerations may ultimately cause a trial court to reject the defendants’
evidence. They may even make the plaintiff’s case substantially more probable
than on the material presently available. But neither Maharaj nor Breitenbach
than on the material presently available. But neither Maharaj nor Breitenbach
permits a summary judgment court to substitute an assessment of comparative
probabilities for the enquiry prescribed by Rule 32. Tumileng draws the line at
whether the defence is genuinely advanced rather than a sham; it does not
authorise the court to decide the substantive merits of a genuinely disputed
defence.
[183] There is particular significance in the fact that, once actual authority is denied,
the plaintiff itself relies upon alternative juridical routes to establish Telco ’s
responsibility, including actual authority, ostensible authority or estoppel, and
ratification. Each depends upon a somewhat different factual enquiry: Actual
authority concerns the scope of the representative ’s antecedent mandate’
estoppel concerns representations attributable to Telco and Sapor’s reasonable
reliance upon them before acting to its prejudice. Ratification concerns Telco’s
knowledge and subsequent adoption of acts initially performed without authority.
[184] The contemporaneous documents provide substantial evidence bearing upon all
three enquiries, but they do not necessarily eliminate the factual distinctions
between them. In particular, the post-transaction WhatsApp communications are
powerful evidence of the relationship between the representatives and Telco and
of Telco’s subsequent conduct, but they do not necessarily establish what
representation concerning authority had been made to Sapor before it funded
the transactions, nor precisely when Telco acquired knowledge sufficient to make
its subsequent conduct an unequivocal ratification.
[185] The contractual interpretation question have a bearing upon those factual
enquiries. The evidence concerning how representatives ordinarily procured
transactions, how Sapor and Telco divided responsibility for verification, and how
the repurchase mechanism functioned in practice may legitimately inform the
context and commercial purpose against which clauses 3, 4 and 7 must be
interpreted in accordance with University of Johannesburg.
[186] I must therefore guard against converting a conclusion that the plaintiff’s case is
presently the more persuasive into the different conclusion that the defendants
have disclosed no bona fide defence. The former involves an assessment of
apparent strength and probabilities; the latter is the question Rule 32 requires
apparent strength and probabilities; the latter is the question Rule 32 requires
me court to decide.
[187] In Cohen NO, the SCA’s formulation is particularly apposite: Prospects of
success are irrelevant if the defendant has disclosed a genuine and legally
cognisable defence which, if proved at trial, would answer the claim. The
defendants’ case may be vulnerable, and their explanation of the
contemporaneous documents may ultimately prove unsatisfactory, but I am
unable to conclude that the interrelated disputes concerning the representative’s
mandate, the representations attributable to Telco, Sapor ’s reliance, the
knowledge necessary for ratification and the contextual interpretation of the
Supplier Agreement are merely contrived or advanced for delay.
The conditional application to be granted the admitted amount paid to Telco
[188] There is one final aspect that I need to deal with and that is Sapor’s claim for
partial summary judgment in the amount it is has been admitted as owing by
Telco.
[189] Sapor argues in the alternative that it is at least entitled to summary judgment for
R151 551.16, said to be admitted. That submission encounters two difficulties.
First, the defendants admit receipt of the sum, but not unequivocally an
indebtedness in that amount. They say it was received and disbursed in
circumstances later revealed to be fraudulent. Second, the alternative claim was
advanced through Sapor’s supplementary affidavit rather than clearly as part of
the original cause of action and relief.
[190] It was argued by Telco’s counsel that without first determining whether or not it
was permissible for these issues to be raised in a supplementary founding
affidavit, there is no unambiguous admission of a presently enforceable debt that
would justify partial summary judgment.
[191] Telco is current that this application was only raised in the supplementary
founding affidavit; it was not raised in response to the amended plea. This was
thus not a consequence of changing the representative’s status from employee
to freelancer.
[192] However, it may be argued that the claim for summary judgment in the admitted
amount is implicit in the original claim. But, at the same time, Rule 28(8) cannot
be used to create an entirely new cause of action for restitution or unjust
enrichment simply because Telco amended its allegations regarding the agency
enrichment simply because Telco amended its allegations regarding the agency
of the person responsible for or participating in the fraud.
[193] There are also disputes as to whether the statements made by Moodley indeed
amount to an admission.
[194] That being said, I accept that the defendants’ account concerning the R151
551.16 is not entirely consistent. The original opposing affidavit describes the
payments as connected to separate legitimate transactions unrelated to the
Church agreements. The amended plea describes the same sum as received in
relation to the Church transactions. Sapor is entitled to rely on that inconsistency.
It may well be a matter of considerable forensic significance at trial, especially
because the payment records appear to make reference to St Augustine’s and
St Francis, and Telco admits paying substantial portions to the alleged freelance
representative.
[195] But the inconsistency does not convert the defendants’ account into a bare
denial.
[196] As I have found that Telco has done enough to get over the bar in resisting the
application for summary judgment, it seems prudent that the trial court determine
the question of quantum and whether amounts owing were or were not admitted.
Alleged reputational harm
[197] The defendants allege that Sapor made or caused defamatory communications
to third parties which characterised Telco as a fraudulent or “dodgy” supplier.
They say that this caused commercial and reputational loss and contributed to
Telco ceasing to trade. They reserve the right to institute a counterclaim or to
invoke set-off.
[198] However, no counter-claim has been instituted, a fact that may serve to indicate
that the defendants are aware that their claim has no prospects; it may also be
that at this stage, it is a claim that the defendants are not able to quantify.
[199] In any event, a reservation of a right to claim damages in the future does not
amount to a defence or a presently operative set-off against Sapor’s claim,
particularly where damages claims are not liquidated. These allegations do not,
particularly where damages claims are not liquidated. These allegations do not,
on their own, preclude summary judgment. They may be relevant at a later stage
if properly pleaded, but they do not presently provide a defence to the plaintiff’s
claim.
The guarantee provided by Moodley
[200] Moodley’s defence requires separate consideration. The defendants rely on PG
Group (Pty) Ltd v Amoretti23 and Neon and Cold Cathode Illuminations (Pty) Ltd
v Ephron24 for the proposition that a suretyship is accessory to the principal
obligation. The fact that a person binds himself as co-principal debtor does not,
without more, render him a primary debtor on an independent obligation.
[201] Sapor submits that the guarantee is deliberately framed in broader terms. It is
described as continuing and absolute and unconditional. It also provides, in
express language, that Moodley’s liability is not affected by circumstances in
which the underlying cause of Telco’s indebtedness lacks legal effect, is voidable
or is unenforceable due to lack of authority. Sapor says that the guarantee
accordingly meets the defence advanced by Moodley head on.
[202] The guarantee cannot simply be assumed to be a conventional suretyship to
which the ordinary accessory principle applies without qualification. Its language
requires close consideration. At the same time, clause 15 confines Moodley’s
liability to Telco’s obligations to Sapor under the Supplier Agreement and its
addenda. The meaning and effect of that limitation must be reconciled with the
“absolute and unconditional” language and the specific provisions relating to lack
of legal effect and lack of authority.
[203] The ultimate enquiry is one of construction. Did Moodley undertake an
autonomous obligation to pay Sapor on demand, independent of any enforceable
indebtedness of Telco? Or did he undertake to secure Telco’s obligations under
the Supplier Agreement, albeit on terms that exclude particular suretyship
defences? The answer may depend on the wording, context and commercial
purpose of the guarantee. It also cannot be wholly divorced from the proper
characterisation of the principal claim.
characterisation of the principal claim.
23 PG Group (Pty) Ltd v Amoretti [2023] ZAGPJHC 6 24 Neon and Cold Cathode Illuminations (Pty) Ltd v Ephron [1978] 2 All SA 1 (A)
[204] The defendants’ separate plea that Moodley signed under a material
misapprehension is weakly pleaded. No clear misrepresentation by Sapor is
identified, and a subjective misunderstanding alone would ordinarily not avoid a
written obligation. Nevertheless, that weakness does not remove the genuine
construction issue arising from the guarantee read as a whole, particularly while
the nature and extent of Telco’s principal liability remains unresolved.
[205] Thus it is appropriate that the question of Moodley’s liability also be referred to
trial.
Conclusion
[206] Sapor has set out a coherent prima facie case based on a written Supplier
Agreement, alleged contractual warranties, the contractual repurchase
provisions, certificates of balance and a guarantee executed by Moodley. Its
case is one of considerable merit.
[207] The defendants, however, have disclosed defences that may not be considered
bald unsubstantiated denials. Their defence is that the Church Transactions were
procured by a rogue freelance representative operating outside his authority, that
neither Telco nor Moodley represented that he possessed the requisite authority,
that Sapor independently dealt with and verified the purported end-users, that
Sapor’s reliance, if any, was not reasonable , that there was no informed
ratification, that the amount claimed is disputed on specific factual grounds, and
that the proper construction of the Supplier Agreement and the guarantee
remains contested.
[208] Some aspects of the defendants ’ case are of questionable merit: Their
explanation of the R151 551.16 requires clarification and their reliance on the
end-user transactions being void ab initio does not automatically defeat a claim
founded on Telco’s own warranties. Their due-diligence and FICA submissions
do not, without more, establish a complete defence. Their reputational -harm
allegation does not justify any set off the liquidated amount said to be owing. In
allegation does not justify any set off the liquidated amount said to be owing. In
addition, Moodley’s alleged material-misapprehension concerning the legal
effect of the guarantee he signed has not been supported by any material facts
and circumstances surrounding its conclusion.
[209] The material disputes include the nature and scope of the alleged freelance
representative’s authority, whether Telco made a representation sufficient to
establish an estoppel, whether Telco ratified the transactions, the meaning and
significance of the WhatsApp communications, the parties’ respective roles in
verification, approval, payment and delivery; of the end-user transactions, the
construction and application of the warranties and repurchase provisions, the
calculation and evidential effect of the certificates, and the proper construction of
Moodley’s guarantee.
[210] A determination of these disputes will require evidence. The Court would be
required to decide contested inferences, evaluate credibility, construe
communications in context and reconcile disputed versions regarding the
payment and the conduct of the representative. That is not t he function of
summary judgment.
[211] Thus, although the plaintiff has demonstrated substantial difficulties in the
defendants’ version, and although its documentary case may ultimately prove
compelling, Rule 32 does not require the defendants to establish that they will
probably succeed at trial. The court must distinguish between a defence which
appears improbable and one which is not genuinely advanced.
[212] Thus, although several of the defendants’ arguments are weak or legally
misconceived, the papers disclose a genuine factual dispute about who procured
the fraudulent transactions, the capacity in which that person acted, what Telco
and Moodley knew or authorised, and whether their subsequent conduct
amounted to adoption or ratification of the transactions. Those questions go
directly to Telco’s liability under the Supplier Agreement and cannot safely be
resolved by treating the WhatsApp exchanges as dispositive.
[213] Moreover, the proper interpretation of the Supplier Agreement in its commercial
context, the antecedent scope and appearance of authority of the representative,
context, the antecedent scope and appearance of authority of the representative,
the representations attributable to Telco upon which Sapor acted, and the
knowledge and conduct said to cons titute ratification remain genuinely
contestable matters. Their determination would require me to decide substantive
factual and interpretative issues rather than merely determine whether the
defence is bona fide.
[214] I have already found that the defendants have discharged the burden resting
upon them under rule 32(3)(b) to disclose facts which, if proved, would constitute
bona fide defences that are not untenable in law.
[215] I accordingly conclude that summary judgment should be refused and the
defendants should be granted leave to defend. This conclusion should not be
understood as an endorsement of the defendants ’ version or as expressing a
view that they are likely to succeed at trial. It reflects the narrower conclusion
required by Rule 32 - that the court cannot properly characterise the relevant
defences as sham without determining factual and interpretative questions which
should more appropriately be tested by oral evidence and cross-examination.
Costs
[216] There is no reason why the ordinary rule should not apply in matters for summary
judgment, and thus that costs should not be costs in the cause in the main action.
Order
[217] The following order is made:
a. The plaintiff’s application for summary judgment is refused.
b. The defendants are granted leave to defend the main action.
c. The costs of the application for summary judgment, including the costs
occasioned by the supplementary affidavits and the condonation
application, are costs in the action.
_ __
WENTZEL-THOMPSON J
JUDGE OF THE HIGH COURT
JOHANNESBURG
Date of the hearing: 30 July 2026
Date of the judgment: 31 August 2026
For the Applicant:
For the Respondent:
Advocate Ushir Ahir instructed by
Jay Mothobi Inc
RM Inc Attorneys