Picardi Hotels Ltd v Thekweni Properties (Pty) Ltd (680/07) [2008] ZASCA 128; 2009 (1) SA 493 (SCA) ; [2009] 1 All SA 471 (SCA) (30 September 2008)

Picardi Hotels Ltd v Thekweni Properties (Pty) Ltd (680/07) [2008] ZASCA 128; 2009 (1) SA 493 (SCA) ; [2009] 1 All SA 471 (SCA) (30 September 2008)

The Supreme Court of Appeal held that the cession in securitatem debiti executed by the respondent in favour of Investec Bank Ltd constituted an immediate and unconditional transfer of rights to the bank. The proviso in clause 8 of the mortgage bond did not suspend the cession itself but merely the exercise of...

Source-derived case information.

Citation
[2008] ZASCA 128
Parties
Appellant: Picardi Hotels Ltd; Respondent: Thekweni Properties (Pty) Ltd
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
30 September 2008
Case Number
680/07
Procedural Posture
Civil Appeal / Appeal From High Court, Durban & Coast Local Division
Outcome
Appeal upheld; respondent's claim dismissed; special plea upheld.
Judges
MPATI, FARLAM, CLOETE, BORUCHOWITZ, KGOMO
Legal Topics
Cession in Securitatem Debiti, Locus Standi, Interpretation of Contracts, Mortgage Bond, Special Plea
Commercial and Corporate Civil Procedure Cession in Securitatem Debiti Locus Standi Interpretation of Contracts Mortgage Bond Special Plea

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Parties

Picardi Hotels Ltd

Appellant

Thekweni Properties (Pty) Ltd

Respondent

Procedural Posture

Civil Appeal / Appeal From High Court, Durban & Coast Local Division

Legal Issues

  1. 1 Whether the cession in securitatem debiti deprived the respondent of the right to sue for arrear rentals.
  2. 2 Whether the proviso in clause 8 of the mortgage bond suspended the operation of the cession or merely the exercise of rights under it.
  3. 3 Whether the respondent had locus standi to claim unpaid rentals from the appellant.

Ratio Decidendi

The Supreme Court of Appeal held that the cession in securitatem debiti executed by the respondent in favour of Investec Bank Ltd constituted an immediate and unconditional transfer of rights to the bank. The proviso in clause 8 of the mortgage bond did not suspend the cession itself but merely the exercise of rights by the bank until certain conditions were met. Consequently, the respondent was divested of the power to sue for arrear rentals, and its locus standi to claim such rentals was lost. The respondent could only recover the ceded debts by obtaining a recession from the bank. The court found that the interpretation advanced by the respondent was inconsistent with the language of...

Court Disposition

Appeal upheld; respondent's claim dismissed; special plea upheld.

Orders

  • The appeal is upheld with costs, including those occasioned by the employment of two counsel.
  • The order of the court a quo is set aside and substituted with: (i) The defendant's special plea is upheld; (ii) The plaintiff's claim is dismissed; (iii) The plaintiff is ordered to pay the costs of the action, including those occasioned by the employment of two counsel.