Griffiths v Janse van Rensburg NO (20269/2014) [2015] ZASCA 158; [2016] 1 All SA 643 (SCA); 2016 (3) SA 389 (SCA) (26 October 2015)

Griffiths v Janse van Rensburg NO (20269/2014) [2015] ZASCA 158; [2016] 1 All SA 643 (SCA); 2016 (3) SA 389 (SCA) (26 October 2015)

The majority held that the payments made to Mr Griffiths, both capital and interest, were made pursuant to void investment agreements constituting a pyramid scheme and thus did not occur in the ordinary course of business as required by section 29 of the Insolvency Act. The court emphasized that the test is objective and focuses on the nature of the business relationship at the time of disposition, not on hypothetical lawful bases that could have been invoked. Since Mr Griffiths demanded and received payment under the void agreements, not under an enrichment claim, the dispositions were correctly set aside. Regarding mora interest, the court reaffirmed that the debt only arises upon...

Citation
[2015] ZASCA 158
Parties
Appellant: Jonathan Brian Griffiths; Respondent: Jacobus Hendrikus Janse van Rensburg NO; Respondent: Romana Bernadette Knuth NO
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
26 October 2015
Case Number
20269/2014
Procedural Posture
Civil Appeal / Appeal From Eastern Cape Local Division of the High Court, Port Elizabeth
Outcome
Appeal dismissed with costs; cross-appeal dismissed with costs.
Judges
Shongwe, Pillay, Petse, Saldulker, Gorven
Legal Topics
Insolvency Act Section 29, Ordinary Course of Business, Pyramid Scheme Liability, Condictio Ob Turpem Vel Iniustam Causam, Mora Interest, Unjust Enrichment
Banking and Finance Civil Procedure Commercial and Corporate Insolvency Act Section 29 Ordinary Course of Business Pyramid Scheme Liability Condictio Ob Turpem Vel Iniustam Causam Mora Interest +1 more

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Parties

Jonathan Brian Griffiths

Appellant

Jacobus Hendrikus Janse van Rensburg NO

Respondent

Romana Bernadette Knuth NO

Respondent

Procedural Posture

Civil Appeal / Appeal From Eastern Cape Local Division of the High Court, Port Elizabeth

Legal Issues

  1. 1 Whether the payments made to the appellant by the Trust were dispositions made in the ordinary course of business under section 29 of the Insolvency Act.
  2. 2 Whether the capital repayments, as opposed to interest payments, should be set aside as void dispositions.
  3. 3 Whether mora interest on the award setting aside the disposition should run from the date of judgment or an earlier date.

Ratio Decidendi

The majority held that the payments made to Mr Griffiths, both capital and interest, were made pursuant to void investment agreements constituting a pyramid scheme and thus did not occur in the ordinary course of business as required by section 29 of the Insolvency Act. The court emphasized that the test is objective and focuses on the nature of the business relationship at the time of disposition, not on hypothetical lawful bases that could have been invoked. Since Mr Griffiths demanded and received payment under the void agreements, not under an enrichment claim, the dispositions were correctly set aside. Regarding mora interest, the court reaffirmed that the debt only arises upon...

Court Disposition

Appeal dismissed with costs; cross-appeal dismissed with costs.

Orders

  • The appeal is dismissed with costs.
  • The cross-appeal is dismissed with costs.