Madibeng Local Municipality v Public Investment Corporation Ltd (955/2019) [2020] ZASCA 157 (30 November 2020)

Madibeng Local Municipality v Public Investment Corporation Ltd (955/2019) [2020] ZASCA 157 (30 November 2020)

The Supreme Court of Appeal held that the Public Investment Corporation Ltd is not 'the State' for purposes of s 11(b) of the Prescription Act, and thus the applicable prescription period is three years, not fifteen. However, the running of prescription was interrupted by Madibeng Local Municipality's repeated tacit and express acknowledgments of liability, including partial payments and annual requests for balances, both before and after service of summons. These acknowledgments reset the prescription period, ensuring that the claims had not prescribed when summons was served. On the merits, Madibeng admitted or was deemed to have admitted all material facts regarding the debts and the...

Citation
[2020] ZASCA 157
Parties
Appellant: Madibeng Local Municipality; Respondent: Public Investment Corporation Ltd
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
30 November 2020
Case Number
955/2019
Procedural Posture
Civil Appeal / Appeal From Gauteng Division of the High Court, Pretoria
Outcome
Appeal dismissed with costs, except for a minor amendment to the order regarding interest commencement dates.
Judges
Ponnan, Saldulker, Plasket, Ledwaba, Weiner
Legal Topics
Prescription Act, Acknowledgment of Liability, Mora Interest, Municipal Liability
Civil Procedure Banking and Finance Prescription Act Acknowledgment of Liability Mora Interest Municipal Liability

Case Brief

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Parties

Madibeng Local Municipality

Appellant

Public Investment Corporation Ltd

Respondent

Procedural Posture

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

Legal Issues

  1. 1 Whether the Public Investment Corporation Ltd's claims against Madibeng Local Municipality have prescribed.
  2. 2 Whether the Public Investment Corporation Ltd has established its claims on the merits for the amounts claimed.
  3. 3 Whether the Public Investment Corporation Ltd is entitled to mora interest from the date the debts were due.

Ratio Decidendi

The Supreme Court of Appeal held that the Public Investment Corporation Ltd is not 'the State' for purposes of s 11(b) of the Prescription Act, and thus the applicable prescription period is three years, not fifteen. However, the running of prescription was interrupted by Madibeng Local Municipality's repeated tacit and express acknowledgments of liability, including partial payments and annual requests for balances, both before and after service of summons. These acknowledgments reset the prescription period, ensuring that the claims had not prescribed when summons was served. On the merits, Madibeng admitted or was deemed to have admitted all material facts regarding the debts and the...

Court Disposition

Appeal dismissed with costs, except for a minor amendment to the order regarding interest commencement dates.

Orders

  • Save to the extent set out in paragraph 2, the appeal is dismissed with costs, including the costs of two counsel. The costs in relation to the preparation, perusal and copying of the record are limited to ten percent of the costs incurred in these tasks.
  • Paragraph 2 of the order of the court below is amended to read: 'The defendant is ordered to pay the plaintiff the sum of R162 639 962.00 together with interest thereon at the rate of 10% per annum with effect from 30 June 2003 in the case of certificate BR25 and with effect from 30 November 2003 in the case of...