Venter NO en 'n Ander v Carels (634/94) [1996] ZASCA 52 (23 May 1996)
- Citation
- [1996] ZASCA 52
- Status
- Judgment
- Jurisdiction
- South Africa
- Court
- Supreme Court of Appeal
- Panel
- Botha, Smalberger, Nienaber, Olivier, Zulman
- Case number
- 634/94
More details
- Court
- Supreme Court of Appeal
- Panel
- Botha, Smalberger, Nienaber, Olivier, Zulman
- Case number
- 634/94
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
The Supreme Court of Appeal held that section 84(1) of the Insolvency Act applies even where the insolvent is not in possession of the movable property at the time of sequestration. The conflicting authorities were resolved by the court's own prior decision in Venter NO v Avfin (Pty) Ltd, which confirmed that the seller's rights are protected and a silent hypothec is created for the outstanding purchase price. The respondent's reliance on UDC Bank Ltd v Seacat Leasing and Finance Co (Pty) Ltd and Another was misplaced, as that reasoning has been expressly rejected. The respondent's additional defences were not pleaded or supported by facts and were summarily dismissed. The appeal succeeded, and the rule nisi was confirmed.
Court disposition
Appeal upheld with costs; the order of the court a quo is set aside and replaced with confirmation of the rule nisi.
Orders
- The appeal is upheld with costs.
- The order of the court a quo is set aside.
- Paragraphs 1(a), (b), and (c) of the rule nisi are confirmed, directing the respondent to surrender the Volkswagen Combi to the appellants, authorizing the Deputy Sheriff to take possession and return it to the appellants, and ordering the respondent to pay the costs of the application.
02
Material facts
Parties
C J Venter N.O.
AppellantR.D. du Plessis N.O.
AppellantR Carels
Respondent03
Procedural history
Posture
Civil Appeal / Appeal From Witwatersrand Local Division
04
Questions and positions
Legal issues
- 01
Whether section 84(1) of the Insolvency Act applies where the insolvent is not in possession of the movable property at sequestration.
- 02
Whether a silent hypothec is created in favour of the seller bank for the outstanding purchase price.
- 03
Whether the appellants acquired ownership of the vehicle and are entitled to its delivery.
Party arguments
- Applicant
- The appellants, as joint curators of the insolvent estates, argued that under section 84(1) of the Insolvency Act, a silent hypothec was created over the vehicle in favour of Volkskas Bank for the outstanding balance of the purchase price. Consequently, ownership of the vehicle vested in the appellants, entitling them to claim delivery from the respondent, who was in possession at the time of sequestration.
- Respondent
- The respondent opposed confirmation of the rule nisi, relying solely on the precedent set in UDC Bank Ltd v Seacat Leasing and Finance Co (Pty) Ltd and Another, which held that section 84(1) does not apply where the insolvent is not in possession of the movable property at sequestration. Additional defences regarding bona fide sale and estoppel were raised on appeal but were not pleaded or factually supported in the answering affidavit.
05
Court’s reasoning
Legal principles
- 01
Insolvency Act 24 of 1936
Section 84(1) of the Insolvency Act creates a silent hypothec in favour of the seller for the unpaid purchase price, regardless of possession at sequestration.
- 02
Venter NO v Avfin (Pty) Ltd [1995] ZASCA 156; 1996 (1) SA 826 (A)
The correct interpretation of section 84(1) is that the seller's rights are protected even if the insolvent is not in possession of the movable property at sequestration.
- 03
Hubert Davies Water Engineering (Pty) Ltd v The Body Corporate of 'The Village' and Others 1981 (3) SA 97 (D); Morgan and Another v Wessels NO 1990 (3) SA 57 (O); UDC Bank Ltd v Seacat Leasing and Finance Co (Pty) Ltd and Another 1979 (4) SA 682 (T)
The reasoning in UDC Bank Ltd v Seacat Leasing and Finance Co (Pty) Ltd and Another is rejected; the approach in Hubert Davies Water Engineering (Pty) Ltd v The Body Corporate of 'The Village' and Morgan and Another v Wessels NO is preferred.
06
Ratio, limits and disposition
Ratio decidendi
The Supreme Court of Appeal held that section 84(1) of the Insolvency Act applies even where the insolvent is not in possession of the movable property at the time of sequestration. The conflicting authorities were resolved by the court's own prior decision in Venter NO v Avfin (Pty) Ltd, which confirmed that the seller's rights are protected and a silent hypothec is created for the outstanding purchase price. The respondent's reliance on UDC Bank Ltd v Seacat Leasing and Finance Co (Pty) Ltd and Another was misplaced, as that reasoning has been expressly rejected. The respondent's additional defences were not pleaded or supported by facts and were summarily dismissed. The appeal succeeded, and the rule nisi was confirmed.
Obiter and limits
- Defences not raised in the answering affidavit cannot be considered on appeal.
- The approach in Hubert Davies and Morgan is now authoritative and should be followed in future cases involving section 84(1) of the Insolvency Act.
Court disposition
Appeal upheld with costs; the order of the court a quo is set aside and replaced with confirmation of the rule nisi.
- The appeal is upheld with costs.
- The order of the court a quo is set aside.
- Paragraphs 1(a), (b), and (c) of the rule nisi are confirmed, directing the respondent to surrender the Volkswagen Combi to the appellants, authorizing the Deputy Sheriff to take possession and return it to the appellants, and ordering the respondent to pay the costs of the application.
Source and reliance status
Supreme Court of Appeal
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Judgment reading view
Judgment text
The complete available source text.
Supreme Court of Appeal
Judgment
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Saaknommer 634/94
IN DIE HOOGGEREGSHOF VAN SUID-AFRIKA APPLAFDELING
LAFDELING
In die saak tussen
C J VENTER N.O.
EN R.D. DU PLESSIS N.O.
Appellante
en
R CARELS
Respondent
CORAM: BOTHA, SMALBERGER, NIENABER,
OLIVIER ARR et ZULMAN WndAR
Verhoordatum: 16 Mei 1996Leweringsdatum:23 Mei 1996
Leweringsdatum:
UITSPRAAK
BOTHA AR:
2
Die appellante is die mede-kurators in die insolvente boedels van die Wilge Delta vennootskap en sy eertydse vennote, PGB Koen en MJ Koen. Voor die sekwestrasie van die boedels van die vennootskap en die vennote het die vennootskap 'n Volkswagen motorvoertuig aangekoop van Volkskas Bank ingevolge 'n afbetalingsverkoopooreenkoms, in terme waarvan die eiendomsreg van die voertuig ten gunste van die verkoper voorbehou is totdat die laaste paaiement van die koopprys afbetaal is. Ten tye van die sekwestrasie was daar nog 'n aansienlike bedrag van die koopprys verskuldig. Intussen het die vennootskap die voertuig herverkoop, en na nog 'n paar herverkope het die voertuig uiteindelik beland by die respondent, wat ten tye van die sekwetrasies in die besit daarvan was.
Die appellante het in die Witwatersrandse Plaaslike Afdeling 'n aansoek teen die respondent ingestel vir die lewering van die voertuig
3
aan die appellante. Die grondslag van die aansoek was dat, ingevolge
die bepalings van artikel 84(1) van die Insolvensiewet 24 van 1936, 'n
stilswyende hipoteek oor die voertuig gevestig is ten gunste van
Voikskas Bank ter versekering van die uitstaande balans van die
koopprys, met die gepaardgaande gevolg dat die eiendomsreg van die
voertuig op die appellante oorgegaan het. Die hofa quohet
a quo
aanvanklik 'n bevel nisi ten gunste van die appellante uitgereik met die
volgende bepalings:
"1 That a Rule Nisi do issue calling upon the Respondent to appear and to show cause, if any, to this Court on the 30th day of August 1994 why a final order should not be made:-
a)
Directing Respondent to surrender Volkswagen Combi 1991 mode 2.5i, engine number AAY 002527 AND CHASSIS NUMBER 20 ZMV 002920 to the Applicants.
b)
Authorizing and directing the Deputy Sheriff to take the said vehicle into his possession wherever it may be found,
4
and to retum it to the Applicant.
c) Ordering the Respondent to pay the costs of this application.
2 Pending the retum day, paragraphs l(a) and l(b) above are to be put into immediate effect."
Op die keerdatum van die bevel nisi het die respondent die bekragtiging daarvan bestry, op die enkele grond dat, volgens die beslissing inUDC Bank Ltd v Seacat Leasing and Finance Co (Pty) Ltd and Another1979(4) SA 682 (T), die bepalings van artikel 84(1) van die Insolvensiewet nie van toepassing is waar die insolvent nie ten tye van die sekwestrasie in die besit van die betrokke roerende saak is nie. Die beslissing van die Transvaalse hof in die genoemde saak is egter nie in ander Afdelings gevolg nie. InHubert Davies WaterEngineering (Pty) Ltd v The Body Corporate of "The Village" and Others1981(3) SA 97(D) is daarvan afgewyk en is die teenoorgestelde
UDC Bank Ltd v Seacat Leasing and Finance Co (Pty) Ltd and Another
Hubert Davies Water
ty) Ltd v The Body Corporate of "The Village" and Others
5
standpunt gehuldig, en inMorgan en 'n Ander v Wessels NO1990(3) SA 57 (0) is die standpunt in dieHubert-Davies-saak verkies bdiin dieUDC Bank-saak.
Morgan en 'n Ander v Wessels NO
Hubert-Davies
diin dieUDC Bank-saak.
in dieUDC Bank-saak.
UDC Bank
Die hof a_quo (NUGENT R) het die beredenering in dieHubert DaviesenMorgansake as oortuigend beskou, maar hom nietemin gebonde geag om die beslissing in dieUDC Bank-saak toe te pas. Op daardie grondslag is die bevel nisi opgehef met koste, maar verlof is verleen om na hierdie hof in hor beroep te kom.
Hubert Davies
Morgan
r beroep te kom.
Intussen is die botsende standpunte in die bogenoemde sake alreeds gesaghebbend opgelos deur die beslissing van hierdie hof inVenter NO v Avfin (Pty Ltd[1995] ZASCA 156;1996 (1) SA 826(A). SCOTT WndAR, wat die uitspraak van die hof gelewer het, het op 834C-835G die verskillende standpunte ontleed en tot die gevolgtrekking geraak dat die beslissings in dieHubert DaviesenMorgansake korrek was en dat
Venter NO v Avfin (Pty Ltd
[1995] ZASCA 156
1996 (1) SA 826
6
die beredenering in dieUDC Bank-saak verwerp moet word. In hierdie omstandighede is dit onnodig om op enige verdere besonderhede in te gaan. Dit is genoeg om te sdat die beslissing van die hofa quonie staande gehou kan word nie.
dat die beslissing van die hofa quonie staande gehou kan word nie.
In die betoog voor ons het die respondent se advokaat gepoog om ander verwere teen die appellante se vordering te opper, naamlik dat die verkoping deur Volkskas Bank aan die vennootskap nie 'nbonafide verkoping was nie en dat die appellante deur estoppel belet word om hulle eiendomsreg teen die respondent te bewys. Die poging is uit die staanspoor tot mislukking gedoem. In die beantwoordende verklaring wat die respondent teen die appellante se aansoek ingedien het, word daar geen woord gerep van sulke verwere nie. Daar bestaan eenvoudig geen feitlike grondslag waarop die veronderstelde verwere in oorweging geneem kan word nie.
bona
7
Die bevel van die hof is soos volg:
1
Die appel word gehandhaaf met koste.
Die bevel van die hofa quoword tersyde gestel en vervang deur die volgende bevel:
"Paragrawe l(a), (b) en (c) van die bevel nisi word bekragtig."
A S BOTHA" APPLREGTER
LREGTER
STEM SAAM
Smalberger AR
Nienaber AR
Olivier AR
Zulman WndAR
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