About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Western Cape High Court, Cape Town
SAFLII
>>
Databases
>>
South Africa: Western Cape High Court, Cape Town
>>
2015
>>
[2015] ZAWCHC 20
|
|
De Bruyn v Du Toit (1162/2015) [2015] ZAWCHC 20 (27 February 2015)
THE
HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
In
the matter between
Case
No: 1162/2015
JOHANN
DE
BRUYN
......................................................................................
PLAINTIFF
And
DERICK
DU
TOIT
.......................................................................................
DEFENDANT
Coram:
ROGERS J
Heard:
26 FEBRUARY 2015
Delivered:
27 FEBRUARY 2015
JUDGMENT
ROGERS
J:
[1]
This is an application for summary
judgment. The plaintiff alleges in his particulars of claim that on
22 May 2007 he lent the defendant
R80 000 and that on 6 August
2007 he lent him a further R200 000. Interest was by agreement
payable at a rate of 50%
per six months (ie 100% per annum). The
defendant, so the plaintiff alleges, repaid the first loan by way of
a payment of R40 000
on 22 February 2008 and a further payment
of R80 000 on 28 March 2008. (These repayments are less than the
capital plus interest
at the full rate allegedly agreed.) The
plaintiff’s claim is for repayment of the second loan together
with interest thereon.
[2]
The plaintiff alleges in his particulars of
claim that on 17 July 2008 the defendant signed a written agreement
acknowledging the
liability and recording the payments made to date.
A copy of that written agreement is annexed to the particulars of
claim. (The
written document actually describes the arrangement as an
investment by the plaintiff with the defendant.)
[3]
The plaintiff alleges, further, that on 9
December 2014 he made written demand for repayment of the sum of
R200 000 plus interest
within 30 days. There was no response. On
13 January 2015 the plaintiff dispatched to the defendant by
registered mail a notification
in terms of
s 129
of the
National
Credit Act 34 of 2005
. Payment having not been forthcoming, the
plaintiff issued summons on 27 January 2015. (Since the
track-and-trace report indicates
that the first notification to the
defendant from the relevant post office took place on 20 January
2015, the summons seems to
have been issued prematurely, ie 10
business days had not elapsed.)
[4]
When the defendant entered appearance to
defend, the plaintiff applied for summary judgment. The defendant has
filed an opposing
affidavit in which two main points are raised,
namely (a) that the interest stipulation violates the
National
Credit Act and
that the agreement as a whole is void and contrary to
public policy; (b) that the claim has prescribed. Mr van der
Meer appeared
for the plaintiff and Mr Basson for the defendant.
[5]
I think prescription is a sufficient basis
for disposing of the application for summary judgment. The plaintiff
alleges in his particulars
of claim that the loan was repayable ‘on
demand’. The written agreement, which was in effect an
acknowledgment of debt,
did not specify a date for repayment and did
not contain any provision for the giving of written notice before
making a claim.
[6]
Mr van der Meer referred me to
Stockdale
& Another v Stockdale
2004 (1 SA 68
(C). He submitted, with reference to this case, that the defendant’s
failure to contest that the loan was only repayable
‘on demand’
was fatal to the defence of prescription. I disagree.
Stockdale
and earlier cases dealing with amounts
payable ‘on demand’ do not lay down a rule that such a
debt becomes due for purposes
of prescription only after demand has
been made. On the contrary, and in keeping with the principle that a
creditor cannot delay
the commencement of prescription by failing to
take a step within his power, it has been held on a number of
occasions that a loan
repayable on demand is immediately due for
purposes of prescription. It is only where the giving of notice is a
condition precedent
for a claim, and thus a necessary ingredient of
the creditor’s cause of action, that the running of
prescription is deferred
until the giving of notice. See Loubser
Extinctive Prescription
1996
at 53-63, where the authorities are reviewed. The learned author
concludes his discussion thus (at 63):
‘
On
account of the policy consideration that a creditor should not be
able to rely on his own failure to demand performance from
the debtor
in order to delay the running of prescription the courts will require
clear indication that the parties intended demand
to be a condition
precedent for the debt to become due, in which case prescription will
only begin to run from the date of demand.’
[7]
The decision in
Stockdale
appears to me to support this general
approach. That was an appeal from a judgment in the magistrate’s
court following a trial.
It so happens that the relevant
acknowledgments of debt contained express provisions to the effect
that the capital and interest
was payable within 30 days from the
date of notice. The question was whether prescription began to run 30
days after the execution
of the acknowledgments, on the basis that
the creditor could have given the written notice forthwith. Traverso
AJP affirmed the
general policy consideration that a creditor should
not be able to rely on his own inaction to delay the running of
prescription
(para 12). She also accepted, as a ‘general rule
of law’, that in all obligations in which a time for payment
has not
been agreed the debt is due forthwith, adding the rider that
this might be qualified ‘in the light of the particular
circumstances
of the case’ (para 15). She said that it was
necessary to ascertain the intention of the parties (para 13). There
was evidence
that satisfied her that there was no immediate
expectation or obligation placed upon the defendant in respect of the
loan. Although
no condition was linked to the making of demand, it
was nevertheless ‘abundantly clear’ that the parties
never contemplated
that notice to repay could be given within 30 days
of the date of the acknowledgments. The parties had concluded the
loan agreements
based on a certain set of circumstances. For as long
as those circumstances prevailed, it was understood that notice would
not
be given (para 17).
[8]
The general principles discussed in
Stockdale
were
applied by Davis J in the unreported case of
Praesidium
Capital Management (Pty) Ltd v Kay-Davidson
[2010] ZAWCHC 531.
That was also an
application for summary judgment in which the defendant raised
prescription among other defences. The defendant
was sued as a surety
on acknowledgments of debt signed by the principal debtor for monies
advanced. The acknowledgments specified
no date for repayment. Davis
J referred with approval to the following statement by Selekowitz J
in
Standard Bank of South Africa Ltd v
Oneanate Investments (Pty) Ltd
1995 (4)
SA 501
(C) at 546I-547B (a passage not inconsistent with the
subsequent judgment on appeal reported at
[1997] ZASCA 94
;
1998 (1) SA 811
(SCA)):
‘
A
loan without agreement as to time for repayment is in common law
repayable on demand. Although by no means linguistically clear,
the
phrase “payable on demand” is used in this context in our
law to mean that no specific demand for repayment is
necessary and
the debt is repayable as soon as it is incurred. When suing for
repayment, there is no need to allege a demand and
such a demand is
not part of the plaintiff’s cause of action.’
Davis J said that
this approach had been followed in
Stockdale
. On this basis he
refused summary judgment.
[9]
It is not necessary, in the present case,
to decide precisely what evidence can be taken into account in
determining whether notice
or demand is a condition precedent for a
cause of action and whether such evidence is limited to that which is
on ordinary principles
admissible in the interpretation of contracts.
We are concerned here with an application for summary judgment. On
the information
currently available to the court, it is not possible
to say that the contract should be interpreted as making demand a
condition
precedent for the recovery of the money. As I have said,
the general statement that the loans were repayable on demand does
not
have this effect nor is there any express provision in the
subsequent written acknowledgment for the giving of notice. On the
face
of it, the written acknowledgment was signed because the
defendant had not yet repaid the money which the plaintiff already
expected
to have been repaid, nearly a year having elapsed from the
time the second loan was advanced. One knows that the first loan was
repaid within less than a year of the advance. There is nothing in
the document or in the other facts pleaded in the particulars
of
claim to suggest that the plaintiff could not at any time have
insisted on repayment.
[10]
If the defendant is able to establish at
trial that prescription began to run by not later than 17 July 2008
(when the historic
indebtedness on the second loan was acknowledged),
the defence of prescription would succeed unless the plaintiff were
to allege
and prove some act of interruption prior to the service of
summons in January 2015. I am satisfied, therefore, that on this
score
the defendant has raised a bona fide defence.
[11]
In view of this conclusion, I deal more
briefly with the defence based on the alleged unlawful stipulation of
interest and resultant
alleged invalidity of the agreement. Mr van
der Meer conceded that his client could not lawfully claim interest
at the contractual
rate allegedly agreed, same being in violation of
the
National Credit Act. He
submitted that even if this were to
result in the contract as a whole being declared invalid, something
he conceded was one potential
outcome having regard to
s 90(4)(b)
,
his client would have a right to recover the capital by way of an
enrichment action. The purported deprivation of this right by
way of
s 90(4)
read with
s 89(5)(c)
has been declared
unconstitutional (
National Credit
Regulator v Opperman & Others
2013
(2) SA 1
(CC)). He submitted that I should thus grant summary
judgment at least for the capital of R200 000.
[12]
There are at least two obstacles in the way
of Mr van der Meer’s submission. The first, procedural in
nature, is that the
plaintiff has not pleaded an alternative claim
based on enrichment.
[13]
The second, which is substantive, is that a
common law enrichment action in circumstances such as the present
case does not allow
recovery of money as of right. Van der Westhuizen
J, writing for the majority in
Opperman
,
pointed out that recovery in such circumstances is ordinarily barred
by the par delictum rule but that this has been ameliorated
by
recognising a discretionary power to permit recovery in accordance
with considerations of fairness (paras 15-17 and authorities
there
mentioned). The common law in this regard was not found to be
contrary to the Constitution. Indeed, the objection to s 89(5)(c)
was that it extinguished a right to claim restitution based on
unjustified enrichment without leaving any discretion to a court
to
consider a just and equitable order under the circumstances (para
88). It would be entirely inappropriate, at the stage of summary
judgment, to assume that an unpleaded enrichment action for recovery
would succeed. The court would need to be informed of the
circumstances in which the loans were made, the relationship between
the parties, whether the loans formed part of a larger scheme
of
business and the like. Furthermore, if the second loan agreement were
found to be invalid as a whole, the same would presumably
apply to
the first loan agreement, so that the defendant might have a
counterclaim to recover at least the purported interest he
paid on
the first loan (cf
Parow Motorhandelaars
(Pty) Ltd
v Parker
[2014]
ZAWCHC 122
para 18).
[14]
Summary judgment is thus refused with costs
and the defendant is granted leave to defend the action.
______________________
ROGERS
J
APPEARANCES
For Plaintiff: Mr S
van der Meer
Van
der Meer Attorneys
4
Durbanville Avenue Service Road
Corner
Durbanville Avenue & De Villiers Drive
Valmary
Park
Durbanville
For Defendant: Mr M
Basson
Instructed by:
De Waal Inc
20
Briffant Street
Chantecler,
Eversdal
c/o
Heyns & Partners
3
rd
Floor, 6 on Pepper
Pepper Street
Cape Town
For Respondent: YYY
Instructed by:
Xxx
Cape
Town