1st Holdings (Pty) Ltd v Boardwalk Lakeside Development (Pty) Ltd (A1134/09) [2012] ZAGPPHC 14 (29 February 2012)

1st Holdings (Pty) Ltd v Boardwalk Lakeside Development (Pty) Ltd (A1134/09) [2012] ZAGPPHC 14 (29 February 2012)

The court held that the respondent was not entitled to interest at the contractual rate of 19% per annum due to lack of evidence of its banker's prime rate during the relevant period. However, the respondent was entitled to interest on the damages awarded, as compensation for loss suffered due to the appellant's breach. The Prescribed Rate of Interest Act applies in the absence of proof of the contractual rate, and the court exercised its discretion to order interest from the date the damages became liquidated, namely the date of settlement (25 February 2005), at the prescribed rate of 15.5% per annum. The appeal was upheld and the order of the court a quo was substituted accordingly.

Citation
[2012] ZAGPPHC 14
Parties
Appellant: 1st Holdings (Pty) Ltd; Respondent: Boardwalk Lakeside Development (Pty) Ltd
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
29 February 2012
Case Number
A1134/09
Procedural Posture
Civil Appeal / Appeal Against Judgment and Order Regarding Interest
Outcome
Appeal upheld with costs. The order of the court a quo is substituted to grant interest at 15.5% per annum from 25 February 2005 until date of payment.
Judges
MNGQIBISA-THUSI, MAKGOBA
Legal Topics
Lease Agreement, Damages for Breach, Prescribed Rate of Interest Act, Interest on Damages
Commercial and Corporate Civil Procedure Lease Agreement Damages for Breach Prescribed Rate of Interest Act Interest on Damages

Case Brief

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Parties

1st Holdings (Pty) Ltd

Appellant

Boardwalk Lakeside Development (Pty) Ltd

Respondent

Procedural Posture

Civil Appeal / Appeal Against Judgment and Order Regarding Interest

Legal Issues

  1. 1 Whether the respondent was entitled to interest on the agreed damages amount.
  2. 2 Whether the rate and period of interest ordered by the court a quo were correct.
  3. 3 Whether the Prescribed Rate of Interest Act applies in the absence of proof of the contractual rate.

Ratio Decidendi

The court held that the respondent was not entitled to interest at the contractual rate of 19% per annum due to lack of evidence of its banker's prime rate during the relevant period. However, the respondent was entitled to interest on the damages awarded, as compensation for loss suffered due to the appellant's breach. The Prescribed Rate of Interest Act applies in the absence of proof of the contractual rate, and the court exercised its discretion to order interest from the date the damages became liquidated, namely the date of settlement (25 February 2005), at the prescribed rate of 15.5% per annum. The appeal was upheld and the order of the court a quo was substituted accordingly.

Court Disposition

Appeal upheld with costs. The order of the court a quo is substituted to grant interest at 15.5% per annum from 25 February 2005 until date of payment.

Orders

  • The appeal is upheld with costs.
  • The order of the court a quo is substituted: Judgment is granted to the plaintiff in the sum of R1 149 000.00 with costs. The first defendant is ordered to pay interest thereon at 15.5% per annum from 25 February 2005 until date of payment.