Silvermoon Investments 278 CC v Slip Knot Investments 777 (Pty) Ltd (2142/2012) [2012] ZAECGHC 58 (23 July 2012)

Silvermoon Investments 278 CC v Slip Knot Investments 777 (Pty) Ltd (2142/2012) [2012] ZAECGHC 58 (23 July 2012)

The court held that the in duplum rule remains applicable and must be given effect. The applicant’s calculation of the outstanding balance, prepared by a chartered accountant and applying the in duplum rule, was accepted as correct, as the respondent failed to provide any substantive challenge or alternative calculation. The applicant established a clear right to cancellation of the mortgage bond upon tender of payment of the outstanding amount, and the respondent’s refusal to accept the guarantee and cancel the bond was without legal justification. The applicant’s authority to institute proceedings was sufficiently established by trustee affidavits and resolutions. The matter was urgent...

Citation
[2012] ZAECGHC 58
Parties
Applicant: Silvermoon Investments 278 CC; Respondent: Slip Knot Investments 777 (Pty) Ltd
Court
Eastern Cape High Court, Grahamstown
Jurisdiction
South Africa
Judgment Date
23 July 2012
Case Number
2142/2012
Procedural Posture
Urgent Application / Final Judgment After Urgent Application
Outcome
Application granted. Orders made in favour of the applicant.
Judges
J.D. Pickering
Legal Topics
In Duplum Rule, Mortgage Bond Cancellation, Bank Guarantee, Authority to Institute Proceedings
Civil Procedure Banking and Finance In Duplum Rule Mortgage Bond Cancellation Bank Guarantee Authority to Institute Proceedings

Case Brief

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Parties

Silvermoon Investments 278 CC

Applicant

Slip Knot Investments 777 (Pty) Ltd

Respondent

Procedural Posture

Urgent Application / Final Judgment After Urgent Application

Legal Issues

  1. 1 Whether the in duplum rule applies to limit the interest recoverable by the respondent under the loan agreement.
  2. 2 Whether the applicant is entitled to cancellation of the mortgage bond upon tender of payment of the outstanding balance as calculated under the in duplum rule.
  3. 3 Whether the applicant furnished a valid irrevocable bank guarantee for the outstanding amount.

Ratio Decidendi

The court held that the in duplum rule remains applicable and must be given effect. The applicant’s calculation of the outstanding balance, prepared by a chartered accountant and applying the in duplum rule, was accepted as correct, as the respondent failed to provide any substantive challenge or alternative calculation. The applicant established a clear right to cancellation of the mortgage bond upon tender of payment of the outstanding amount, and the respondent’s refusal to accept the guarantee and cancel the bond was without legal justification. The applicant’s authority to institute proceedings was sufficiently established by trustee affidavits and resolutions. The matter was urgent...

Court Disposition

Application granted. Orders made in favour of the applicant.

Orders

  • Respondent is ordered within 3 days of the date of this order to take all steps necessary and to sign all documents necessary to cancel the first covering mortgage bond B1793/2008 in favour of the Respondent and to take all steps and to sign all documentation to effect such cancellation, against the provision by or...
  • In the event of Respondent failing to comply with paragraph 1 above within such period as set out therein, the deputy sheriff for East London is authorized to take all steps and to sign all documentation necessary to effect the cancellation of the first covering mortgage bond B1793/2008 in favour of the Respondent.