De Vasconcelos and Others v Business Partners Ltd (637/2018) [2019] ZASCA 80 (31 May 2019)

De Vasconcelos and Others v Business Partners Ltd (637/2018) [2019] ZASCA 80 (31 May 2019)

The court found that the royalty agreement was not a disguised interest payment but a separate commercial obligation, fully understood and accepted by the appellants after extensive negotiations. There was no evidence of fraud, oppression, or extortion on the part of the respondent. The in duplum rule did not apply to the royalty payment, as it was not arrear interest but a distinct contractual obligation. The appellants' public policy defence failed, as the agreements were entered into freely and with full knowledge of their terms. The appeal was dismissed with costs.

Citation
[2019] ZASCA 80
Parties
Appellant: Roberto Carlos De Freitos De Vasconcelos; Appellant: Primolitos CC; Appellant: Primoplas CC; Appellant: Portion Control Packers CC; Respondent: Business Partners Ltd
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
31 May 2019
Case Number
637/2018
Procedural Posture
Civil Appeal / Appeal From Gauteng Division of the High Court, Pretoria
Outcome
Appeal dismissed with costs, including the costs of two counsel.
Judges
Cachalia, Mbha, Dambuza, Davis, Plasket
Legal Topics
Suretyship, Contra Bonos Mores, In Duplum Rule, Usurious Contracts, Loan Agreements
Commercial and Corporate Civil Procedure Suretyship Contra Bonos Mores In Duplum Rule Usurious Contracts Loan Agreements

Case Brief

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Parties

Roberto Carlos De Freitos De Vasconcelos

Appellant

Primolitos CC

Appellant

Primoplas CC

Appellant

Portion Control Packers CC

Appellant

Business Partners Ltd

Respondent

Procedural Posture

Civil Appeal / Appeal From Gauteng Division of the High Court, Pretoria

Legal Issues

  1. 1 Whether the royalty agreement constitutes disguised interest and is contra bonos mores.
  2. 2 Whether the in duplum rule applies to the royalty payment under the agreements.
  3. 3 Whether the appellants were properly informed of the nature and extent of their obligations under the agreements.

Ratio Decidendi

The court found that the royalty agreement was not a disguised interest payment but a separate commercial obligation, fully understood and accepted by the appellants after extensive negotiations. There was no evidence of fraud, oppression, or extortion on the part of the respondent. The in duplum rule did not apply to the royalty payment, as it was not arrear interest but a distinct contractual obligation. The appellants' public policy defence failed, as the agreements were entered into freely and with full knowledge of their terms. The appeal was dismissed with costs.

Court Disposition

Appeal dismissed with costs, including the costs of two counsel.

Orders

  • The appeal is dismissed with costs, including the costs of two counsel.