van Niekerk NO v van der Merwe (21032/2009) [2012] ZAWCHC 349 (9 November 2012)

van Niekerk NO v van der Merwe (21032/2009) [2012] ZAWCHC 349 (9 November 2012)

The court found that the defendant, an experienced businessman and contract drafter, failed to discharge the onus of proving that his actual intention did not conform to his declared intention in signing the consolidation agreement. The evidence showed that the defendant was aware, or ought to have been aware, of the suretyship clause, which was clearly presented in bold capitals immediately above the signature line. The plaintiff credibly testified that the suretyship was discussed and agreed upon, and the defendant's version was improbable and contradicted by his own conduct and testimony. The court held that there was no misrepresentation and that the defendant's error was not iustus....

Citation
[2012] ZAWCHC 349
Parties
Plaintiff: MR DION VAN NIEKERK NO; Defendant: MR ANDRE FRANCOIS VAN DER MERWE
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
9 November 2012
Case Number
21032/2009
Procedural Posture
Civil Trial / Judgment
Outcome
Defendant's defence of iustus error is rejected; defendant is liable as surety and co-principal debtor.
Judges
Meer
Legal Topics
Suretyship, Iustus Error, Contractual Liability, Repayment of Loans
Commercial and Corporate Civil Procedure Suretyship Iustus Error Contractual Liability Repayment of Loans

Case Brief

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Parties

MR DION VAN NIEKERK NO

Plaintiff

MR ANDRE FRANCOIS VAN DER MERWE

Defendant

Procedural Posture

Civil Trial / Judgment

Legal Issues

  1. 1 Whether the defendant's defence of iustus error (unilateral mistake) in signing the suretyship clause can be upheld.
  2. 2 Whether the defendant is liable as surety and co-principal debtor under the consolidation agreement.

Ratio Decidendi

The court found that the defendant, an experienced businessman and contract drafter, failed to discharge the onus of proving that his actual intention did not conform to his declared intention in signing the consolidation agreement. The evidence showed that the defendant was aware, or ought to have been aware, of the suretyship clause, which was clearly presented in bold capitals immediately above the signature line. The plaintiff credibly testified that the suretyship was discussed and agreed upon, and the defendant's version was improbable and contradicted by his own conduct and testimony. The court held that there was no misrepresentation and that the defendant's error was not iustus....

Court Disposition

Defendant's defence of iustus error is rejected; defendant is liable as surety and co-principal debtor.

Orders

  • The defendant shall pay to the plaintiff the sum of R2,450,260.35 together with interest thereon at 25% per annum, with effect from 1 June 2009, such interest to be compounded and capitalised annually on 1 June of each and every year thereafter, until payment of the total amount.
  • The defendant shall bear the costs of the action.