Standard Bank of South Africa Limited v Technofin (Pty) Ltd (239/2013) [2017] ZAGPPHC 1214 (21 September 2017)

REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

CASE NO: 239/2013

DATE: 29/9/2017

In the matter between:

STANDARD BANK OF SOUTH AFRICA LIMITED

Plaintiff

and

TECHNOFIN (PTY) LTD

Defendant

JUDGMENT

KEIGHTLEY, J:

INTRODUCTION

[1] The plaintiff in this matter is the Standard Bank of South Africa (Pty) Limited ("the Bank"). The defendant, Technofin (Pty) Ltd ("Technofin"), is an asset based rental finance company. It specialises in financing the acquisition of high-end equipment, including office equipment, construction equipment (otherwise know as "yellow equipment"), IT equipment, security equipment and medical equipment, through rental agreements that it enters into with corporate customers.

[2] The Bank instituted action against Technofin, under two main deeds of cession entered into between the parties in 2001 ("the first main cession agreement" or "first MCA") and 2008 ("the second main cession agreement" or "second MCA") respectively. It is common cause that under these MCAs it was agreed that from time to time Technofin would offer to the Bank certain rental contracts (entered into between Technofin and its customers) for cession to the Bank on certain terms. Although it was initially disputed, by the time the trial commenced, it was common cause that under this arrangement, Technofin had ceded to the bank a batch of 118 rental contracts, which formed the subject matter of the litigation. I might add that the total number of contracts ceded to the Bank over the years exceeded this number, but the Bank's claim was limited to the 118 identified in the pleadings.

[3] In short, the Bank's case is that, for various reasons that will be detailed later, Technofin has breached the warranties that it gave under clause 5.1 of the MCAs. The Bank contends that this entitles it, under clause 6.2 of these agreements, to require Technofin to repurchase all of the 118 identified rental contracts, alternatively, 13 contracts that the

Bank earmarked as having been tainted, for reasons I will also discuss later ("the tainted contracts"). The Bank claims an amount of R18 243 147. 00, being the total amount due to it in respect 9f the 118 contracts under the repurchase clause, alternatively an amount of R4 155 470. 73, being the total amount due to it in respect of the 13 tainted contracts under the repurchase clause. Prior to the hearing, the parties agreed to a separation of the merits of the Bank's claim from the issue of quantum. Thus, this judgment only deals with the merits. The order contains the provisions dealing with the quantum issue as agreed to by the parties.

[4] Technofin disputes the Bank's claim on the following bases:

1. It contends that the Bank's interpretation of certain aspects of clauses 5 and 6 of the MCAs is incorrect, and pleads an alternative interpretation. I shall refer to this as "the interpretation issue".

2. Technofin instituted a counterclaim, in which it sought rectification of clause 5.2 of the first main cession agreement, and 5.3 of the second main cession agreement. I shall refer to this as "the rectification issue".

3. It raises a special plea of prescriPTTon, to which the Bank replicated. I shall refer to this as "the prescriPTTon issue".

4. It disputes the Bank's claim on the merits.

BACKGROUND

[5] It is common cause that the 118 rental contracts forming the subject matter of the Banks claim were concluded between Technofin and its customers between 2003 and 2009. It is also common cause that, in each case, they were ceded to the Bank shortly thereafter. The Bank's case is that during 2011 it instituted an internal forensic investigation into a number of rental contracts that had been ceded to the Bank by Technofin. This occurred after a debt-collecting agent acting for the Bank had raised flags about certain suspected irregularities involving these contracts. Mr Louw, from the Bank's internal forensic department, undertook the investigation. He prepared a report that was finalised, on his evidence, on 1 September 2011 ("the forensic report"). I will deal with Mr Louw's report and his evidence in more detail later. For present purposes it is sufficient to note that the report stated that an investigation had been conducted into 19 deals involving what the report refers to as a "dealer", identified as "On Target Trust", in addition to a number of other deals involving other "dealers", most notably, "GIIA" and "Santa Sales". The main thrust of the forensic report was that these three dealers had appeared to be engaging in what were essentially money raising transactions with customers, rather than rental agreements, and that they were linked to possibly fraudulent conduct in this regard.

[6] In order to understand the link between the deals tainted in the Bank's forensic report and Technofin, it is necessary to provide some basic explanation of the relationship between Technofin and these "dealers". I place the term in inverted commas because there was some dispute between the parties as.to the correct designation and function of these role­ players, viz. On Target Trust (“OTT”); GIIA and Santa Sales.

[7] It is common cause that Technofin does not source customers itself. Instead, it is involved in partnerships with various suppliers/dealers, who can provide equipment to potential customers in circumstances where the customer requires access to finance in order to pay for the equipment. These suppliers source potential customers and determine their particular equipment needs. Thereafter, the supplier provides Technofin with the relevant information for the latter to determine whether it will provide finance to the customer for the equipment under a rental agreement entered into between Technofin and the customer. Technofin generally pays the supplier for the equipment, and in terms of the rental agreement, the customer is liable for the monthly repayments to Technofin according to an agreed payment schedule. As security for the finance advanced by Technofin,

it retains ownership of the equipment until all payments have been made in full. This is the general scheme in terms of which the rental agreements between Technofin and its customers come into existence.

[8] The rental agreements are then offered to the Bank under the main cession agreements and, if accepted, the Bank will acquire

Technofin's rights under the rental agreements in exchange for the agreed monetary consideration. It was common cause that the

conclusion of the rental agreements between Technofin and its customers occurs very shortly before the conclusion of the cessions

of those agreements to the Bank. Although the evidence of Mr Lyon, on behalf of Technofin, indicated that in some instances

Technofin uses its own resources to finance the acquisition of the equipment in question, he did not dispute that Technofin

also relied on the proceeds of the cession to finance that acquisition. In other words, in many instances, the cession of the agreements to the Bank provides Technofin with the necessary resources to enable it to finance the acquisition of the equipment

for its customers.

[8] OTT, GIIA and Santa Sales were suppliers who partnered with Technofin to

source customers, resulting in rental agreements that were ceded to the Bank and which, in terms of the forensic report, were found to be tainted.

[10] In the Bank's particulars of claim, it averred that 13 of the rental agreements were tainted for various reasons including the following:

1. the equipment that formed the subject matter of the rental agreements was not delivered to the customer;

2. there was no genuine intended sale from the supplier to the defendant and/or from the defendant to the plaintiff;

3. there was no genuine intended rental of the equipment to the customer;

4. the deals constituted money-raising transactions, rather than true rental agreements.

[11] On this basis, the Bank averred that Technofin acted in breach of its warranties under clause 5.1 of the main cession agreements in that:

1. the rental agreements that were ceded were not valid, binding and enforceable;

2. Technofin did not pass valid and absolute title to the goods to the Bank in terms of which the Bank could become owner thereof;

3. Technofin did not pass good, valid, free and unencumbered transferable right, title and interest in and to the rental agreement and the goods to the plaintiff;

4. the agreements that were delivered to the Bank did not correctly reflect the intentions of the parties (i.e. the customer and Technofin) and were not factually correct in every respect;

5. complete delivery was not made to, and unqualified acceptance was not taken of the equipment by the customer.

[12] In support of its case that Technofin had breached its warranties, the Bank led the evidence of two witnesses who were Technofin's

customers in 9 of

the 13 tainted contracts involving on as Technofin's partner. These were

Mr Streak, who conducted the busine.ss of Vaalharts Techniese Dienste (“Vaalharts”), and Mr Marias, who conducted the business of Prudent Trust trading as Solo Sand (“PTT”). For the remainder of the tainted contracts, the Bank did not lead the evidence of any of the customers involved. It relied instead on the forensic report detailing these deals, and Mr Louw's findings, together with Mr Louw's evidence. The Bank applied for the admission of this hearsay evidence under section 3(1)(c) of the Law of Evidence Amendment Act 45 of 1998. This raises a further issue for consideration.

[13] As far as the direct evidence of the tainted contracts is concerned, the material aspects of Mr Streak's and Mr Marais' evidence were not in dispute. In summary, the upshot of this evidence was as follows:

1. Vaalharts was the owner of an lveco Truck, which required repairs to its engine and gearbox. According to Mr Streak, he needed approximately R200 000. 00 to effect these repairs. Through OTT, he completed an “equipment finance application” with Technofin. He was advised

by the OTT representative that Technofin was more likely to finance the acquisition of yellow equipment, rather than repairs to an existing vehicle. It was not disputed that the documents prepared for completion of the rental contract between

Vaalharts and Technofin did not reflect that finance was required for repairs to an existing vehicle. Instead, they reflected that

Vaalharts required the finance to acquire a CAT excavator. Mr Streak's uncontested evidence was that he had never sought to

acquire, nor did he acquire a CAT excavator. The finance provided under the rental contract with Technofin was paid directly into Vaalharts' bank account. He used the bulk of it to effect the repairs on his lveco truck, and the remainder went towards general business expenses.

2. Mr Marais testified about the 8 rental contracts involving PTT. During 2006 PTT required finance to purchase new equipment and also to maintain and upgrade its existing plant. Through OTT, he concluded a master rental agreement with Technofin, to which schedules were added. These schedules identified certain equipment that would be acquired with the finance provided by Technofin. As regards this equipment:

a) PTT did acquire a new Buller vehicle, as indicated in one of the schedules. The supplier of this vehicle was paid directly by Technofin.

b) There was some confusion as to a schedule for a second Buller vehicle. Mr Marais was adamant that PTT never sought finance for, nor did it acquire a second Buller vehicle.

c) Two further items of new equipment were acquired as per the schedules, viz. a conveyor complete with bolting, and a dewatering screen.

d) Two assets identified in the schedules, a CAT and a WAPCA Rock Dumper were already owned by PTT at the time that it concluded the rental agreement. The finance provided by Technofin was not used to finance their acquisition, but rather to re-finance them. This was not disclosed in any of

the documentation supporting the rental contracts and schedules ultimately provided to the Bank.

e) The remainder of the items in the equipment schedules was acquired by PTT, but not as new equipment. PTT sourced the equipment second hand. The finance supplied by Technofin was paid directly to PTT, which then paid the suppliers.

f) The documents submitted in support of the acquisition of the second hand equipment did not reflect that the equipment was second hand.

g) Furthermore, and significantly, the invoices submitted in support of the acquisition of this equipment inflated the prices by between 50% and 75%. Mr Marais testified that PTT used the excess finance provided to cover ordinary business expenses.

[14] The documents supporting the rental contracts between Technofin, Vaalharts and PTT were submitted to the Bank with the offers of cession in each case. The Bank accepted the offers based on the information contained in those documents. The Bank's case was that the Vaalharts and PTT rental contracts evidenced a number of material breaches of the warranties under the MCAs, including:

1. Clause 5.1.5 of the MCAs was breached in that the rental contracts did not correctly reflect the true (as opposed to the simulated) intentions of the parties. In many instances, in truth the agreements were agreements of loan and refinance, rather than rental agreements.

2. Clause 5.1.5 of the MCAs was further breached in that the rental contracts were not factually accurate in every respect. They did not reflect that, in reality, the equipment was already owned by PTT, and was in effect being re-financed; or the equipment to be acquired (and which would form the security under the rental contracts) was not new but was used; or that the true value of the equipment was far less than the value reflected in the invoices

supporting the rental contract.

3. Clauses 5.1.2 and 5.1.4 of the MCAs was breached in that in many instances no good title was passed to the Bank under the rental contracts.

4. Payments were made directly to the customer as opposed to the supplier, in breach of clause 5.1.5 of the MCAs read with clause 4.1 of the master rental agreements in each case.

[15] Although Technofin disputed these breaches in its plea, at the close of the case Technofin's counsel, Mr van Zyl, advised the court that his client conceded that it was in breach of its warranties, in relation to the Vaalharts rental contract, and 4 of the 8 PTT contracts. It continued to dispute Technofin's alleged breach of the remaining tainted contracts, including those covered only by the hearsay evidence referred to earlier.

[16] These concessions were correctly made. The uncontested evidence of Mr Streak and Mr Marais clearly established the averred breaches. Thus, it is common cause that Technofin was in breach of the warranties. What must be determined is what the Bank's rights of recourse are under the MCAs consequent on the breach. This immediately brings the interpretation issue to the fore. The determination of this issue in turn will affect the determination of the further issues of prescription, admission of the hearsay evidence, and the merits of the matter.

INTERPRETATION ISSUE

[17] At issue here is the correct interpretation of two clauses of the main credit agreements. Firstly, clause 5.2 of the first MCA, and its counterpart, clause

5.3 of the second MCA. As it appears in the MCA, clause 5.2 reads as follows:

"If any Customer legally proves that it has any claim as referred to in 5.1 and/or withholds payment of any amount owing under a contract (the Bank) shall have the right to require (Technofin) to repurchase the contract upon the terms and conditions provided for in 6.2 hereunder."

[18] Technofin's rectified version, reads as follows:

"If any Customer legally proves that it has any claim as referred to in 5.1 and withholds payment of any amount owing under a contract (the Bank) shall have the right to require (Technofin) to repurchase the contract upon the terms and conditions provided for in 6.2 hereunder."

[19] The only difference between the original and rectified versions is indicated by the underlined portions of each. As far as clause 5.3 is concerned, originally it read as follows:

"If any Customer alleges that it has any claim or defence as referred to in clauses 5.1 and/or 5.2 above and/or withholds payment of any amount owing under a contract and/or credit agreement and legally proves or fails to prove such claim or defence within 90 (ninety) days of allegation, the Bank shall have the right to require (Technofin) to repurchase the contract and/or credit agreement upon the terms and conditions provided in 6.2 hereunder."

[20] Technofin's rectified version of clause 5.3, reads as follows:

" If any Customer alleges that it has any claim or defence as referred to in clauses 5.1 and/or 5.2 above and/or withholds payment of any amount owing under a contract and/or credit agreement and legally proves such claim or fails to prove such defence within 90 (ninety) days of allegation, the Bank shall have the right to require (Technofin) to repurchase the contract and/or credit agreement upon the terms and conditions provided in 6.2 hereunder."

[21] As with clause 5.2, the difference in the two versions is to be found in the underlined portions. The Bank did not oppose the

rectifications on the basis that the rectified versions did not mark any material change to the clauses, and made no difference to the interpretation. I proceed to consider the interpretation issue on the basis of the rectified versions of the clauses in question. I should add that neither party adopted the approach that there was any substantial difference between the older, clause 5.2 and the later, clause 5.3 insofar as the legal relationship between them was concerned.

[22] Turning to clause 6.2, this reads in the same terms in both the first MCA and the second MCA, as does 6.1. While the interpretation of 6.1 is not directly placed in dispute, it is necessary to record its terms, as clause 6.2 follows directly thereafter:

"6. Indemnities by the Cedant

6.1 (Technofin) hereby indemnifies (the Bank) and holds it harmless against any claim, loss or expense (including consequential damages, Joss of revenue and profits, legal costs on the scale as between an attorney and his own client, and any other costs) arising out of or in connection with or which may be sustained or incurred by (the Bank) as a direct or indirect consequence of any breach by (Technofin) of any of the terms, conditions, warranties, representations or undertakings of (Technofin) in terms of this agreement or any cession pursuant hereto including but not limited to any innocent or negligent misrepresentation by (Technofin) to (the Bank).

6.2 As an alternative, at (the Bank's) election, or in addition to claiming under the indemnity referred to in 6.1, in the event of any breach by (Technofin) of any of the provisions of this agreement, (the Bank) shall be entitled to require (Technofin)

to repurchase the contract in respect of which the breach was committed and any other contracts designated by (the Bank) which were ceded by (Technofin) to (the Bank) pursuant to this agreement upon the following terms and conditions:-

6.2.1 the consideration payable by (Technofin) to (the Bank) on any such repurchase shall be the present value of the collectible under

the contractls repurchased as at the date of receipt of that consideration by (the Bank) plus all costs and expenses which (the Bank) may have incurred including (but not limited to) costs of storage, repairs, repossession, refurbishing, sale and legal costs on the scale as between an attorney and his own client;

6.2.2 upon receipt of the consideration referred to in 6.2.1, (the Bank) shall deliver the contract's in question to (Technofin) and the contract together with ownership in the goods shall be deemed to have been ceded back to (Technofin) upon such delivery."

[23] The wording under both the first MCA and the second MCA is virtually identical. Technofin did not seek rectification in respect of clause 6.2.

[24] In its particulars of claim the Bank pleads as follows as regards the proper interpretation of clauses 5.2 and 5.3, and 6.2:

"On a proper construction of the (MCAs), having regard to the surrounding and background circumstances, a breach by the defendant of any of the warranties contained in clause 5.1 (and 5.2 in the second MCA) thereof allowed the plaintiff to invoke the remedy of clause 6.2 ... without the need to allege and prove the events set out in clause 5.2 (or 5.3 in the second MCA) thereof" (my emphasis)

[25] Technofin, on the other hand, pleads that on a proper construction of the MCAs, the Bank would only be entitled to invoke the remedy provided under clause 6.2 "after a customer and/or the plaintiff having legally proven a breach by the defendant of any of the warranties contained in clause 5.1" (emphasis provided by Technofin).

[26] In addition, Technofin pleads that the Bank's interpretation is "manifestly unreasonable to the extent that it offends public policy, having regard to the provisions of section 39(2) of the Constitution of the Republic of South African and the values of ubuntu and is irreconcilable with constitutional norms and values."

[27] Technofin also pleads for a particular interpretation of clause 6.2 in terms of which it says that the Bank is entitled only to require Technofin to repurchase the specific rental agreements that have been breached. In other words, it contends that the Bank may not designate any other, untainted contracts for repurchase under clause 6.2.

[28] Thus, there are two legs to the interpretation issue:

1. The first is to determine the proper construction of clause 5.2 (or 5.3 of the second MCA) and its effect, if any, on the Bank's rights to require Technofin to repurchase rental agreements under clause 6.2.

2. The second leg applies in the event that the Bank's interpretation is accepted. In that case, the question that arises is whether clause

6.2 means that the Bank is entitled to designate for repurchase contracts that are not tainted.

[29] The parties are in agreement on the relevant principles to be applied in the interpretive exercise as laid down in the recent case law since Natal Joint Municipal Pension Fund v Endumeni Municipality.[1] In summary, as part of one unitary exercise a court must determine what the parties intended their

contract to mean with reference to the following:

1. The words of the document, which is the starting point of the interpretive exercise.

2. The literal meaning of the words is not the only consideration.

3. They must be considered in the light of their relevant and admissible context. This includes the background and the circumstances in which the contract came into being.

4. The purpose of the contractual provisions is also a consideration.

5. When more than one meaning is possible, each possibility must be weighed in light of these factors.

6. A sensible meaning is to be preferred to one that leads to insensible or unbusinesslike results or undermines the apparent purpose of the document.

7. The subsequent conduct of the parties may be probative of the common intention of the parties at the time they entered into the contract.

[30] Regarding the correct interpretation of clause 5.2 (or 5.3 in the second MCA), the effect of Technofin's interpretation is to circumscribe the entitlement of the Bank to require Technofin to repurchase rental agreements under clause 6.2. Technofin's case is that the Bank may only require it to repurchase under clause 6.2 in the following circumstances:

1. First, where a customer raises (and proves) as a defence or a claim vis- a-vis the Bank, that Technofin breached its warranties under the MCAs.

2. Second, and in addition, where the customer also withholds payment to the Bank under the ceded rental agreement.

[31] On Technofin's approach, it is only if these two pre-requisites are met that the Bank is entitled to its remedy under clause 6.2. The pre-requisites have their origin in clauses 5.2 and 5.3. In other words, Technofin's case is that clauses 5.2 (or 5.3 under the second MCA) must be read together with clause 6.2 such that they limit the ambit of the remedy available under clause 6.2.

[32] On this interpretation, clause 6.2 does not provide a stand-alone remedy to the Bank. It is only triggered by a breach of the rental agreement by a customer, and in circumstances where the customer relies of a breach by Technofin. This means that the Bank only has one entitlement to require repurchase, and this right arises only in the circumstances set out in clause 5.2 (or 5.3).

[33] On the Bank's interpretation, clause 6.2 is a stand-alone remedy that applies, at its election, in the event of a breach by Technofin of its warranties to the Bank under the MCAs. Whether or not a customer has withheld payment to the Bank or not is irrelevant. The remedy is available regardless of whether, as between the Bank and a customer, the latter has raised, in a claim or defence against the Bank, an alleged breach of warranty by Technofin relating to the rental contract at hand. On the bank's approach, clauses 5.2 (or 5.3) and clause 6.2 serve different purposes, and the scope and application of the latter clause is not circumscribed by the former.

[34] Considering the language of the provisions as a starting point, the following features are noteworthy:

1. Clause 5.2 (or 5.3) is not grouped with clauses 6.1 and 6.2 under the indemnity section of the MCAs. There is thus no obviously inherent link between these provisions, as contended for by Technofin.

2. There is only one express reference to clause 6.2 in clause 5.2 (or 5.3). This is to the effect that the Bank may require Technofin to repurchase the contract "upon the terms and conditions provided in 6.2". Counsel for Technofin agreed that this is a reference to clauses 6.1.2 and 6.2.2. Those provisions set out the terms and conditions that establish the formula to be used to calculate the consideration payable when the Bank invokes its entitlement to require the repurchase of any rental agreement.

3. Other than that, there is no indication of any other intended link between clause 5.2 (or 5.3) and clause 6.2.

4. Clause 6.2 in its turn makes no reference, direct or indirect to clause 5.2 (or 5.3).

5. It is so that both clause 5.2 (or 5.3) and clause 6.2 deal with the Bank's right to require Technofin to repurchase rental contracts. However, when one compares the plain language making up each of the provisions, it is clear that they differ markedly.

6. Clause 5.2 (or 5.3) is introduced by the phrase "if a customer ... ". In plain terms, this indicates that what follows in the clause, i.e. the Bank's right under that clause to require the repurchase of an agreement, applies in the specific circumstances described therein. On the other hand, clause 6.2 is stated in much wider terms. It is stated as an alternative or an addition to the Bank's right to claim indemnity from Technofin for any claim, loss or expense arising out of or in connection with any breach by Technofin of, inter alia, its warranties. From the language of the provision, it is clearly intended to cover as wide a field of indemnity. It follows that the alternative or additional remedy to indemnity, viz. the right to require repurchase, is also intended to cover as wide a field as possible. There is no reference, either direct or indirect, in clause 6.2 (read with 6.1) that indicatesany intention to limit the "breach of warranties" to a breach envisaged under clause 5.2 (or 5.3).

7. On the contrary, unlike clause 5.2 (or 5.3), clause 6.2 makes no reference to. a custome;r or to any amount owing by him or her under a rental agreement to the Bank; or to a customer withholding payment to the Bank; or to any legal proceedings between the Bank and a custome.r

[35] Considering the plain wording of the provisions, there is simply nothing in the language to even suggest that clause 5.2 (or 5.3) was intended to limit the circumstances in which the Bank could exercise its rights under clause 6.2. In fact, all the language pointers are strongly in the other direction.

[36] Of course the plain meaning of the language is not the end of the interpretive inquiry. It is also necessary to take into account the context and purpose of the provisions as a backdrop their interpretations. In this case, as far as both parties are concerned,

the MCAs were adopted in the context of, and served, a business or commercial purpose. I have already alluded to this in the introductory portions of my judgment. It is apparent from the nature of the commercial relationship between the parties that what arose from the MCAs were two parallel but separate legal relationships:

1. First, the legal relationship established under, and governed by, the MCAs between the Bank and Technofin.

2. Second, the legal relationship, established under, and governed by, the ceded rental contracts between the Bank (as the cessionary) and the customer. Although this legal relationship was originally established between Technofin and its customers, as a result of the cession, the Bank assumed from Technofin all the latter's rights under the rental contracts vis-a-vis the customers.

[37] The effect of the non-recourse nature of the MCAs is that the Bank acquired locus standi against the customers to enforce the latters' obligations under the rental contracts. In other words, consequent on the cession of the rental contracts, the Bank stepped into the shoes of Technofin as creditor, and as if it were the original contracting party.

[38] The purpose of section 5.2 (or 5.3) must be seen in this context. It provides a remedy in circumstances where, in litigation between the Bank and a customer (i.e. where the cause of action is the relevant rental contract), the customer relies on a breach by the original contracting party in the rental contract (Technofin), and where this breach would also constitute (as between the Bank and Technofin) a breach of the latter's warranties. What clause 5.2 (or 5.3) does in those circumstances is to permit the Bank to opt out of its contractual relationship with the customer and to require Technofin, through a repurchase of the contrac,t to step back into its original contractual shoes.

[39] There is a commercially sound reason for this: the Bank was entitled to accept the cession of a rental contract with the expectation that the contract would be valid and binding. It required Technofin to provide a warranty to this effect. If a customer is able to prove that, as a result of Technofin's conduct, the rental contract was defective and thus not binding then the Bank is entitled to opt out and to leave it to Technofin to litigate with the customer. Technofin's position is also protected in that clause 5.2 requires that a customer must legally prove the alleged breach. This means that Technofin is not vulnerable to being undermined by spurious defences raised by customer. This also explains why Technofin was so concerned, on its evidence, to include the phrase "legally proves" in the clauses.

[40] In this commercial context, clause 6.2 (read with clause 6.1) serves a broader purpose. The indemnity and repurchase remedies under clause 6 arise out of the direct legal relationship created between the Bank and Technofin under the MCA. Unlike the scenario applicable under clause 5.2 (or 5.3), it is the MCA that forms the cause of action when the Bank seeks to enforce its rights under clause 6. Critically, a claim based on clause 6.2 is not customer-driven. The Bank is not dependent on a customer withholding payment and citing as a defence a defect in the rental contract as a result of a breach by Technofin. A claim under 6.2 is Bank-driven. It is up to the Bank to determine when it wishes to act against Technofin in the event of a breach of the warranties, and it is up to the Bank to elect its remedy from the options available under clause 6.

[41] Once again, there is a commercially sound reason for this: it is common cause that prior to the cession the Bank has no direct dealings with Technofin's customers. Technofin sources all the necessary information from its potential customers. It passes this information on to the Bank so that the Bank may determine whether there is commercial value in accepting the cession of the rental agreements offered. While the arrangement between the parties is that the Bank finances the transaction between the original contracting parties, viz. Technofin and the customer, the Bank is not itself an original contracting party. It thus cannot oversee or control the conclusion of the rental contracts between Technofin and its

customers, but must place reliance on the accuracy of the information and undertakings supplied by the Bank. It is for this reason that the Bank requires Technofin to provide the relevant warranties to the effect that, among other things, that the rental agreements are valid and binding, that the information in the contracts is accurate; and that the Bank will get valid title to the equipment financed.

[42] Seen against this commercial background, it stands to reason that the Bank must have available to it a remedy in circumstances where it (rather than a customer) avers that Technofin is in breach of its warranties. Further, that the Bank should be able to protect its position vis-a-vis Technofin regardless of the relationship between the Bank and the customers.

[43] The difficulty with Technofin's interpretation is that it fails to distinguish between, and properly account for, the two parallel but separate legal relationships existing between the Bank (as cessionary) and the customer (under the rental contracts), on the one hand, and the Bank and Technofin (under the MCAs) on the other. Instead, it conflates these two legal relationships into one,

three-party relationship. Consequently, it fails to recognise that different purposes are served by clause 5.2 (or 5.3) on the one hand, and clause 6 on the other.

[44] Technofin's interpretation is also at odds with the commercial reality underpinning the MCAs. It is the Bank, by and large, that provides Technofin with the financial resources to finance Technofin's customers' acquisition of equipment. The Bank advances

this money up-front to Technofin when the cessions take place. It would be irrational for the Bank to be prepared to do this without

ensuring that its rights are properly protected under the MCAs. One of the risks that it must factor into account is that the contracts

entered into between Technofin and its customers (in which the Bank plays no direct role) may be inaccurate, irregular or invalid or otherwise unenforceable due to conduct on the part of Technofin. As I have already indicated, this is the purpose of the warranties. From a business perspective, the Bank would obviously wish to protect its interests against this risk. This would require that the Bank itself could take charge of the legal avenues open to it in the event of Technofin committing a breach of the warranties. In this context, it simply makes no sense at all that Technofin would permit its legal remedy under clause 6.2 to be restricted to circumstances where a customer withholds payment, and which would render the Bank utterly dependent on non-payment and litigation decisions taken by a customer. This is effectively what Technofin's interpretation entails.

[45] The overwhelming sense one gets from the language of the provisions read within their context and purpose is that the Bank's

interpretation of clause 5.2 (or 5.3) is correct. Technofin's interpretation is not supported by the language and is contrary to

all business-sense.

[46] Technofin submitted that the evidence it led at the trial supported its interpretation of clause 5.2. Mr Minnie, Technofin's

attorney testified that he was involved in advising Technofin at the time the second MCA was entered into. He testified to the importance of Technofin's insistence (against the Bank's initial opposition) on including the words "legally proves" in clause 5.3. In my view, this evidence takes the matter no further. Mr Minnie's testimony centered only on clause 5.3 and not clause 6.2. He gave no advice regarding clause 6.2 to his client. In addition, his testimony only covered the second, and not the first MCA In any event, I have already dealt with the purpose of the phrase "legally proves" in the context of clause 5.3. These words have no material relevance to the question of the correct interpretation of clause 6.2, taking into account the language, context and purpose of The MCAs.

[47] I will deal with Mr Lyon's evidence later, as it has more relevance to the second leg of the interpretation inquiry than the first leg.

[48] Mr van Zyl on behalf of Technofin also submitted that the Bank's own evidence supported his client's interpretation. This submission was based on the forensic report in which various statements were made implying that the Bank's invocation of its remedy

under clause 6.2 was dependent on clause

5.2 (or 5.3). Mr Louw testified that he was the author of the forensic report and that he had submitted it to various managers (including legal managers) before it was adopted. He testified that what was stated in his report was his opinion of what the contract meant. However, he indicated that he was not a legal expert.

[49] Technofin's reliance on Mr Louw's evidence and the forensic report to support its interpretation is unsound. In simple terms, Mr Louw's opinion of what the terms of the M9As meant (and for that matter the opinion of his managers as well, to the extent that this was indirectly provided in the report) is inadmissible as it goes against the parol evidence rule. It has been held that:

"... interpretation is a matter of law and not of fact and, accordingly, interpretation is a matter for the court and not for witnesses.

...

An expert may be asked relevant questions based on assumption or hypotheses put by counsel as to the meaning of a document. The

witness may not be asked what the document means to him or her. The witness (expert or otherwise) may also not be cross-examined on the meaning of the document or the validity of the hypothesis about its meaning. Dealing with an argument that a particular construction of a document did not conform to the evidence, Aldous LJ quite rightly responded with 'So what?',[2]

[50] In the circumstances, no reliance may be placed on any opinion expressed in the forensic report or by Mr Louw as to the meaning of clause 5.2 (or 5.3) read with clause 6.2.

[51] For these reasons, I conclude that the Bank's interpretation of clause 6.2 is correct. The Bank is entitled to invoke its remedy to require Technofin to repurchase rental contracts regardless of whether or not the situation outlined in clause 5.2 (or 5.3) exists. Clause 6.2 provides a stand-alone remedy, legally divorced from any contractual dispute between the Bank and a customer envisaged under clause 5.2 (or 5.3).

[52] This brings me to the second leg of the inquiry, viz. the meaning of clause 6.2. In particular, does it entitle the Bank to designate additional, non-tainted assets for repurchase by Technofin? Alternatively, is Technofin's interpretation correct, and is the Bank restricted to requiring Technofin to repurchase only tainted contracts.

[53] The operative part of clause 6.2 in this regard reads:

"... (the Bank) shall be entitled to require (Technofin) to repurchase the contract in respect of which the breach was committed and any other contracts designated by (the Bank) which were ceded ... pursuant to this agreement ..." (my underlining)

[54] Starting with the plain language of the provision, the underlined portion clearly extends the category of contracts subject to repurchase beyond " the contract in respect of which the breach was committed'. One cannot simply ignore the underlined portion of the provision. The fact that it is included indicates that the parties intended it to mean something. Accordingly, a meaning must be given to it. The language indicates, very simply, that in addition to tainted contracts (" and'), the Bank may designate for repurchase any others that were ceded to it by Technofin. Significantly, Technofin did not seek to rectify clause 6.2. Thus, its position must be taken to be that the clause means what it says.

[55] Mr van Zyl submitted in his closing argument that another meaning of the underlined portion of the provision is possible. His submission was that this meaning was to be found if one read clause 5.2 (or 5.3) together with clause 6.2. On this interpretation, as I understand the submission, where a customer raises a breach by Technofin of its warranties as a claim or defence in litigation with the Bank, the Bank is entitled to require Technofin to purchase the rental contract in issue (as per clause 5.2). However, should Technofin refuse to do so, this will trigger the underlined portion of clause 6.2. In other words, what it means is that the Bank may only designate further contracts for repurchase in circumstances where clause 5.2 (or 5.3) applies, and then only if Technofin refuses to accept is obligation under that clause to repurchase the rental contract in question.

[56] One of the difficulties with this submission is that the suggested interpretation is based on an interpretation of clause 5.2 (or 5.3) and clause 6.2 that I have already rejected. It assumes that clause 5.2 (or 5.3) restricts the application of clause 6.2 to the situation outlined in the former clause. For the reasons already advanced, this interpretation is not sound.

[57] Another difficulty with Technofin's suggested interpretation is that it simply finds no foundation in the language of the provisions. The interpretation requires that the Bank should first exercise its entitlement under clause 5.2 (or 5.3) to require Technofin to repurchase the contract in question. It further requires that Technofin should refuse this demand. Only then, may the Bank designate other rental contracts for repurchase. There is nothing in either clause 5.2 (or 5.3) or clause 6.2 to lend life to this scheme. One would have expected, if this were the parties' intention, that the scheme would have been dealt with explicitly, and that there would have been reference to the parties' respective rights and obligations in that regard. The provisions as they stand are silent in this regard. They do not refer to any demand by the Bank and a refusal by Technofin to comply. This is an important

omission, as the scheme suggested by Technofin's interpretation requires a refusal by it in order to trigger the application of the disputed portion of clause 6.2. As was stated in the Endumeni judgment, interpretation involves giving sensible meaning to contractual or statutory provisions. It follows that a sensible meaning cannot be derived out of thin air when there is no support to be found in the very language of the provisionat hand. Interpretaiton should not involve the kind of linguistic gymnastics required by Technofin's interpretation.

[58] Mr Bekker, who was the senior counsel for the Bank, submitted that there were sound commercial reasons for the Bank's entitlement under clause 6.2 to designate contracts for repurchase over and above the contracts actually affected by Technofin's breach of its warranties. The Bank is dependent on Technofin's interaction with its customers prior to the cessions, and on Technofin's conduct in concluding the rental contracts with the customers. As I have already indicated, this is the very purpose of the warranties. They protect the Bank against the risk that Technofin's earlier conduct vis-a-vis its customers may render ceded rental contracts legally vulnerable.

[59] The Bank submits that if Technofin is found to have breached its warranties such that some contracts are legally tainted, this

undermines the trust relationship between the Bank and Technofin. Depending on the circumstances at hand, the Bank is entitled to assume that the validity of other contracts entered into over a particular period, or involving similar role­ players or

circumstances, may also be at risk. Therefore, it makes commercial sense for them to be entitled to opt out of this risk by designating

other contracts for repurchase. This puts the possible risk of further legally invalid contracts back on Technofin's doorstep. It should not fall to the Bank to have to investigate each case to determine whether there has in fact been a breach by Technofin. The Bank's case is that this is the purpose underlying the disputed portion of clause 6.2.

[60] Technofin relied on the evidence of Mr Lyon, who is its CEO. He was also the CEO at the time the MCAs were entered into. He testified that the rental agreements at issue in this case represented only a small portion of the total number of contracts

ceded to the Bank by Technofin. During the relevant period, Technofin's total "book" with the Bank was in the region

of R220 million. He testified that were the Bank to be entitled under clause 6.2 to require Technofin to repurchase all its ceded rental contracts, it simply would not be in a position to do so. According to Mr Lyon, Technofin would never have entered into an agreement that permitted the Bank to require it to repurchase all its ceded contracts under clause 6.2.

[61] Mr Lyon's evidence overlooks an important factor. Clause 6.2 does not say that the Bank may require Technofin to repurchase all its ceded rental contracts as Mr Lyon's evidence assumes. It permits the Bank to designate further contracts for repurchase. Nor has the Bank in this case sought the repurchase of all its ceded rental contracts.

[62] Further, clause 6.2 must be seen against the backdrop of commercial reality. In the majority of cases the continuation of the cession arrangement under the MCAs serves the interests of both the Bank and Technofin. It would make no commercial sense for the Bank to use its entitlement under clause 6.2 to put an end to this relationship by requiring Technofin to repurchase all of its ceded contracts. That would be an extreme measure unrelated to commercial reality. Critically, it is not the remedy sought by the Bank in this case. Whether the Bank in fact could effectively terminate the legal relationship established under the MCAs by requiring Technofin, under 6.2 alone, to repurchase all the ceded rental contracts then in existence is an open question. It is not one that needs to be determined by this court. The extreme, worst-case scenario basis upon which Mr Lyons testified is thus not a proper platform upon which to approach the interpretation of clause 6.2. Nor does it lend support to Technofin's averment that the Bank's interpretation is unreasonable or unconstitutional. That is not a determination that should be made on a worst-case scenario basis.

[63] Mr Lyons' evidence also overlooks the fact that the effect of Technofin being required to repurchase the rental contracts puts it back into the position of creditor in relation to the affected customers. In addition, as the facts of this

case demonstrate, Technofin would have legal remedies available against any of its partners, like OTT, who may have been responsible for Technofin's breach of warranty. The evidence before the court included reference to an earlier case instituted by Technofin and, among others, OTT ("the lnelek case") involving similar circumstances to some

of those covered in the Bank's forensic report. In that case, Technofin repurchased the credit agreements, and instituted proceedings against OTT. However, for whatever reason, Technofin did not seek to join OTT as a third party in the present proceedings. Nothing prevents them from proceeding against OTT in the future.

[64] Technofin argued that where a creditor has gone insolvent, its remedy will be ineffective. That argument cannot properly be used to bolster Technofin's interpretation of the MCAs between it and the Bank. Under the MCAs the Bank required, and Technofin agreed to, the warranties set out in clause 5. This was to protect the Bank's position, bearing in mind that it was dependent on Technofin's conduct in concluding the rental agreements with its customers, and providing the Bank with valid and regular and accurate contracts for cession. Clause 6.2 is triggered by Technofin's breach. If Technofin is unable ultimately to recover from its customer subsequent to repurchase, that is a risk that emanates from its own breach. It makes sense that Technofin, and not the Bank should bear the consequences.

[65] As I have already indicated, the plain language of clause 6.2 supports the Bank's interpretation. I am of the view, for the reasons set out above, that this interpretation is sound when viewed against the backdrop of the commercial context within which the MCAs operate. Therefore, I conclude that in terms of clause 6.2, provided that the Bank establishes a breach of a warranty by Technofin, it is entitled to require Technofin to repurchase not only any contract implicated in the breach, but also the further contracts

designated by the Bank.

[66] Before proceeding to deal with the merits, it is necessary to consider the prescription issue.

PRESCRIPTTON

[67] The relevant provisions of the Prescription Act[3] are to be found in section 12,

which provides that:

"(1) Subject to the provisions of subsections (2), (3) and (4), prescription shall commence to run as soon as the debt is due. "

(2)

(3) A debt shall not be deemed to be due until the creditor has knowledge of the identity of the debtor and of the facts from which the debt arises: Provided that a creditor shall be deemed to have such knowledge if he could have acquired it by exercising reasonable care."

(my underlining)

[68] Technofin accepts that it bears the onus to prove that the Bank's claims had prescribed by a given date. In other words, it accepts that it must prove the commencement date of the prescriptive period. It further accepts that it bears the evidentiary burden described by the Supreme Court of Appeal in in Macleod v Kweyiya[4] as follows:

"The court has repeatedly stated that a defendant bears the full evidentiary burden to prove a plea of prescription, including the date on which a plaintiff obtained actual or constructive knowledge of the debt. The burden shifts to the plaintiff only if the defendant has established a prima facie case ... ".

[69] Technofin's case as regards prescription rests on the proviso contained in the underlined portion of section 12(3) above. Its case, contrary to that of the Bank, is that with the exercise of reasonable care, the Bank could have acquired knowledge of the identity of the debtor and the facts from which the debt arose prior to the finalisation of the forensic report.

[70] Technofin bases its case on the date when each of the customers to the 13 rental contracts at issue defaulted on their liability to pay their monthly rentals to the Bank. Technofin contends that the debt forming the subject matter of the Bank's claim against it is substantially the same as the debt Technofin would have had against the customer in the event of non-payment by the customer.

Furthermore, Technofin contends that with the exercise of reasonable care, the Bank could have completed its investigation arising from non-payment by the customer within 6 months of that non-payment.

This period is based on more or less the period it took Mr Louw to complete his forensic investigation and to produce the forensic

report. Thus, says Technofin, with the exercise of reasonable care, the Bank could have obtained the requisite knowledge of the debt within six month's of each date of non-payment by the customers involved in the 13 tainted contracts. Further, that in all but one case, the effect of this calculation is that the debts had prescribed by the time that the Bank instituted its action against Technofin in January 2013.

[71] In my view, the starting point of Technofin's case is flawed. It assumes that the debt arising between the Bank and Technofin is substantially the same as that between Technofin and the customer on breach by non-payment of the customer. Its case rests on the proposition that the failure by the customers to make payment under the rental contracts triggered a duty on the Bank to take reasonable steps to acquire the requisite knowledge to institute its case against Technofin. In other words, as from the date of non­ payment by each customer, the Bank acquired a duty to take steps investigate the irregularities and fraud that ultimately were uncovered in the forensic investigation.

[72] The fundamental flaw in this argument is that it is not the non-payment by the customers that gave rise to the breach of the

warranties by Technofin. What gave rise to that breach was the conduct Mr Louw found in his forensic investigation. Thus, the mere

fact of non-payment by the customers alone would not have triggered any reasonable duty on the Bank to conduct a forensic investigation

into possible fraud and other irregularities.

[73] Furthermore, knowledge, for purposes of section 12(3) of the Prescription Act, is not constituted by a mere suspicion not amounting to a conviction or belief justifiably inferred from circumstances, no matter how strong that suspicion.[5] The mere non-payment by customers could not be said to raise even a suspicion in the minds of the reasonable creditor that the contracts in question were irregular, or fraudulent and invalid.

[74] Even if one looks past this fundamental flaw, all that Mr Louw's evidence showed was that he received instructions in the early part of 2011 to investigate suspected irregularities and fraud, and that he completed his investigation on 1 September 2011 in a period of approximately 6 months. There was no evidence before the court showing what led the Bank's debt­ collecting agent to form its suspicion that there were irregularities in the contract; when this suspicion was formed; what action it took; and when it alerted the Bank to its suspicions. Therefore, it cannot be concluded from the evidence, even at a prima facie level, that the six month period from date of non-payment contended for by Technofin is indeed a reasonable period within which the Bank could have been expected to acquire the requisite knowledge to institute its action against Technofin.

[75] Technofin pointed out that Mr Lyon's evidence regarding the lnelek case instituted against, among others, OTT in 2009 supported its case that the Bank could have been expected to take steps much earlier to uncover the irregularities in the present case. However, Mr Lyon conceded that the dealings between Technofin and the Bank around the lnelek case were confined to that case alone. There is thus no evidence indicating that because, in hindsight, OTT was later shown to have been involved in other irregular dealings, the. Bank was under a duty to have investigated sooner. On Technofin's own evidence, its book alone with the Bank at this stage was some R220 million. Inevitably, this would have involved numerous ceded contracts. On Technofin's approach, the Bank would have been under a duty to investigate all contracts on default by a customer in order to determine whether there might be irregularities giving rise to breaches of the warranties. For obvious reasons, this is simply not commercially feasible.

[76] It follows that Technofin has failed to meet its onus to establish that the prescriptive period for the Bank's debt against Technofin, which forms the basis of this action, commenced 6 months after each of the customers defaulted on their monthly rentals. The evidence before the court indicates that the Bank acquired actual knowledge of the debt when it obtained the forensic report on 1 September 2011. The prescriptive period commenced on that date, and the Bank's claim was instituted in January 2013, well before the completion of that period.

[77] For these reasons, the special plea of prescription must fail.

MERITS

[78] The merits issue can be disposed of very briefly. It follows from my finding as regards the interpretation issue that in order to enforce its remedy under clause 6.2 of the MCAs all that the Bank must establish is a breach of a warranty by Technofin. It is not necessary for the Bank to establish a breach in respect of each of the 13 tainted contracts, nor in respect of the remaining 105 designated . Once a breach of one is established, it is open to the Bank to designate further contracts for repurchase. Thus, even in the absence of a proven breach in respect of any of the remaining tainted contracts, the Bank is entitled to designate these, as it has done, as well as further contracts for repurchase.

[79] This has the consequence t at it is unnecessary for me to consider the question of whether the hearsay allegations contained in the forensic report, and Mr Louw's evidence in this regard, ought properly to be admitted under section 3 of the Law of Evidence

Amendment Act. Technofin has conceded that it breached its warranties in at least 5 of the tainted contracts. This concession is a sufficient basis upon which to find that the Bank has established its case.

[80] The further consequence of this is that it is not necessary for me to deal with the evidence pertaining to breach that was led at the trial. In any event, both parties agreed that there was nothing contentious in any of the evidence that was presented on the issue of breach by the witnesses for both the Bank and plaintiff. Credibility and the probabilities of competing versions do not arise for determination in this case. In the circumstances, I say no more about the evidence pertaining to the breaches beyond the summary given earlier in this judgment.

PUBLIC POLICY/THE CONSTITUTION/UBUNTU

[81] Technofin did not advance any concrete submissions to the court on its plea that the provisions in question should not be enforced

because they are against public policy and offensive to the Constitution. I have already dealt with an interpretative aspect of

this defence in passing earlier.

[82] It is not necessary for me to consider the matter further. This is because it is an established principle in our law that a constitutional issue of this nature cannot be argued in a vacuum. It must be properly pleaded, and evidence must be led in order to enable the court to carry out its important Constitutional duty in determining whether a contract is offensive.[6] It is not clear from Technofin's plea in this regard, or the evidence that was led, what precisely it contends is constitutionally offensive about the MCAs.

[83] Even if I were permitted to proceed on surmise in this regard, I could not find the requisite offense caused by the agreements. The MCAs were between two substantial commercial entities. They were directed at a commercial purpose and involved commercial benefits for both sides. From Technofin's evidence, it is clear that it was in a position to, and did, engage with the Bank in negotiating the inclusion of a term it regarded as being important in the second MCA. The relationship between the Bank and Technofin has endured for many years on the basis of two MCAs that, in all material respects, are the same. We are not dealing here with an inequality of contractual power. Nor is there any other reason to take the serious step of striking down a contract that both parties agreed to and that has been in place for a number of years.

[84] Accordingly, there is no merit in this defence.

CONCLUSION

[85] For all of the above reasons, I find that the Bank must succeed in its action.

[86] I make the following order:

1. The defendant is found to be in breach of the warranties listed in clause 5.1 of the main cession agreements.

2. The defendant is ordered to re-purchase the 118 cession agreements specified in annexure "C" appended to the plaintiff's particulars of claim.

3. The defendant is ordered to pay the costs of the action, including the costs consequent upon the employment of two counsel.

4. The costs for 31st August 2017, 1 September 2017 and 5 September 2017 are not taxable as trial days but may be taxed as preparation by plaintiff for trial.

5. The determination of the quantum pertaining to the consideration payable (repurchase amount) in respect of the 118 cession agreements by the defendant to the plaintiff in terms of clause 6.2.1, is referred to a referee in terms of the agreement concluded between the parties, dated 28 Jul 2017, the terms of such reference are enlisted herein as follows:-

5.1 Failing settlement of the repurchase amount payable by agreement, such dispute shall be referred to a practicing, independent chartered accountant of not less than twenty (20) years standing ("the referee") for determination of the value of the consideration payable for the repurchases. Such referral shall be made within thirty days after it is demanded and be held-

5.1.1 In Sandton, inform ally, but in accordance with the provisions of the Arbitration Act 42 of 1956 as amended.

5.1.2 The appointed referee-

(a) Will be tasked to determine the value of the consideration payable by the defendant to the plaintiff for the repurchase of the 118 rental / credit agreements;

(b) Will have regard to the desire of the parties to dispose of such dispute expeditiously, economically and confidentially;

(c) Need not observe or take into account the strict procedural rules of law in arriving at his/her decision, which will be made as an expert and not as an arbitrator;

(d) Will determine the liability for his charges which will be paid accordingly

5.2. The parties irrevocably agree that the decision in any such proceedings will: -

5.2.1 be final and binding on all of them;

5.2.2 forthwith be carried into effect;

5.2.3 may be made an order of court of competent jurisdiction

________________________

R M KEIGHTLEY

JUDGE OF THE HIGH COURT OF SOUTH AFRICA

GAUTENG LOCAL DIVISION, JOHANNESBURG

Date Heard:

22 August 2017 - 6 September 2017

Date of Judgment: 21 September 2017

Counsel for the Plaintiff: Adv. FJ Bekker, SC

Adv. JC Viljoen

Instructed by:

Stupel & Berman Incorporated

Counsel for the Defendant: Adv. MMWVan Zyl, SC

Instructed by:

Thomas Minnie Attorneys

[1] 2012 (4) (SA) 593 (SCA), particularly at paras 18-19; Bothma-Batho Transport (Edms) Bpk v S Bothma & Seun Transport (Edms) Bpk 2014 (2) SA 494, at para 12; KPMG Chartered Accountants (SA) v Securefin Ltd & Another 2009 (4) SA 399 (SCA); North East Finance (Pty) Ltd v Standard Bank of South Africa Limited 2013 (5) SA 1 (SCA) at para 24-5; Novartis SA (Pty) Ltd v Maphil Trading (Pty) Ltd 2016 (1) SA 518 (SCA) at paras 24-6; Unica Iron and Steel (Pty) Ltd & Another v Mirchandani 2016 (2) SA 307 (SCA) at para 91

[1] 2012 (4) (SA) 593 (SCA), particularly at paras 18-19; Bothma-Batho Transport (Edms) Bpk v S Bothma & Seun Transport (Edms) Bpk 2014 (2) SA 494, at para 12; KPMG Chartered Accountants (SA) v Securefin Ltd & Another 2009 (4) SA 399 (SCA); North East Finance (Pty) Ltd v Standard Bank of South Africa Limited 2013

(5) SA 1 (SCA) at para 24-5; Novartis SA (Pty) Ltd v Maphil Trading (Pty) Ltd 2016

(1) SA 518 (SCA) at paras 24-6; Unica Iron and Steel (Pty) Ltd & Another v Mirchandani 2016 (2) SA 307 (SCA) at para 91

[2] KPMG Chartered Accountants v Securefin & Another 2009 (4) SA 399 (SCA) at para 39 (first dictum) and para 40 (second dictum)

[3] 68 of 1969

[4] 2013 (6) SA 1 (SCA) at para 10

[5] Minister of Finance & Others v Gore NO 2007 (1) SA 111 (SCA)

[6] Barkhuizen v Napier [2007] ZACC 5; 2007 (5) SA 323 (CC); Everfresh Market Virginia (Pty) Ltd v Shoprite Checkers (Pty) Ltd2012 (1) SA 256 (CC)