Kursan and Another v Eastern Province Building Society (257/94) [1996] ZASCA 8; 1996 (3) SA 17 (SCA); (12 March 1996)

Kursan and Another v Eastern Province Building Society (257/94) [1996] ZASCA 8; 1996 (3) SA 17 (SCA); (12 March 1996)

The majority held that the aggregate limit specified in clause 2 of the mortgage bond was intended to apply only to capital and certain expenses, and not to interest. Clause 3, which expressly secures interest, was interpreted as providing security for interest without limitation by the aggregate amount in clause 2. The court reasoned that the context and overall intent of the bond, as well as the commercial reality of the Society's business, supported this interpretation. The majority found no compelling reason to read the limitation as applying to interest, and concluded that interest is fully secured under the bond. The appeal was accordingly dismissed with costs.

Citation
[1996] ZASCA 8
Parties
Appellant: Sharon Lynn Kursan; Appellant: David Sheldon Horwitz; Respondent: Eastern Province Building Society
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
12 March 1996
Case Number
257/94
Procedural Posture
Civil Appeal / Appeal From Eastern Cape Division
Outcome
Appeal dismissed with costs.
Judges
Schutz, Hefer, E M Grosskopf, Van den Heever, Marais
Legal Topics
Mortgage Bond Security, Interest Limitation, Deeds Registries Act, Contractual Interpretation
Land and Property Banking and Finance Mortgage Bond Security Interest Limitation Deeds Registries Act Contractual Interpretation

Case Brief

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Parties

Sharon Lynn Kursan

Appellant

David Sheldon Horwitz

Appellant

Eastern Province Building Society

Respondent

Procedural Posture

Civil Appeal / Appeal From Eastern Cape Division

Legal Issues

  1. 1 Does the limit on the extent of security expressed in the mortgage bond apply to interest, or is it confined to capital and certain expenses?
  2. 2 Is interest fully secured under the bond, or is it subject to the aggregate limit specified for capital and additional sums?
  3. 3 How should the relevant clauses of the bond be interpreted in light of section 51 of the Deeds Registries Act?

Ratio Decidendi

The majority held that the aggregate limit specified in clause 2 of the mortgage bond was intended to apply only to capital and certain expenses, and not to interest. Clause 3, which expressly secures interest, was interpreted as providing security for interest without limitation by the aggregate amount in clause 2. The court reasoned that the context and overall intent of the bond, as well as the commercial reality of the Society's business, supported this interpretation. The majority found no compelling reason to read the limitation as applying to interest, and concluded that interest is fully secured under the bond. The appeal was accordingly dismissed with costs.

Court Disposition

Appeal dismissed with costs.

Orders

  • The appeal is dismissed with costs.