South Africa Case Law

Standard Bank of South Africa Ltd v Clulow and Another (12161/2018)

Standard Bank of South Africa Ltd v Clulow and Another (12161/2018) [2024] ZAGPPHC 909 (6 September 2024)

Court

North Gauteng High Court, Pretoria

Case number

12161/2018

Judge

Janse Van Nieuwenhuizen

The court found that the plaintiff proved the defendant's indebtedness under the suretyship agreement by producing a certificate of balance that, despite not explicitly stating 'manager,' was signed by a person whose managerial capacity was confirmed by extrinsic evidence. The certificate sufficiently identified the amount due and the date of indebtedness. The defendant's limitation and termination defences failed due to lack of evidence of the debt amount at the relevant date and absence of written release or cancellation by the plaintiff. The prescription defence was rejected because the de…

Source excerpt

• Suretyship
• Certificate Of Balance
• Prescription Act
• General Law Amendment Act Section 6
• Release Of Surety
• Costs Order

VBS Mutual Bank (In Liquidation) v Mafoko and Another (2021/34634)

VBS Mutual Bank (In Liquidation) v Mafoko and Another (2021/34634) [2023] ZAGPJHC 105 (9 February 2023)

Court

South Gauteng High Court, Johannesburg

Case number

2021/34634

Judge

Maier-Frawley

The court found that the respondents executed valid written suretyships in favour of VBS, binding themselves as sureties and co-principal debtors for Leratadima's indebtedness up to R100 million, excluding interest. The facility agreement and its addenda were valid, binding, and implemented, with Leratadima receiving and utilising the funds. The respondents' defences of tacit extension or new credit agreement were not pleaded or supported by admissible evidence and were contractually precluded by the non-variation clause. The alleged unlawful suspension of the facility agreement by VBS did no…

Source excerpt

• Suretyship Liability
• Facility Agreement
• Certificate Of Indebtedness
• Non Variation Clause
• Release Of Surety
• Mora Interest

Standard Bank of South Africa Limited v Stoch and Another (24801/2021)

Standard Bank of South Africa Limited v Stoch and Another (24801/2021) [2022] ZAGPJHC 858 (2 November 2022)

Court

South Gauteng High Court, Johannesburg

Case number

24801/2021

Judge

Mahomed

The High Court referred a bank's claim on suretyship liabilities to trial because material disputes of fact existed about the second respondent's release from surety.

• Suretyship Liability
• Motion Proceedings
• Release Of Surety
• Summary Judgment
• Variation Of Contract
• Costs Order

Ndubu and Others v First Rand Bank Limited t/a Wesbank (1113/2016)

Ndubu and Others v First Rand Bank Limited t/a Wesbank (1113/2016) [2017] ZASCA 61 (26 May 2017)

Court

Supreme Court of Appeal

Case number

1113/2016

Judges

Lewis, Tshiqi, Majiedt, Swain, Coppin

The court found that none of the three offers to purchase the vehicles were rejected by Wesbank or the liquidators. The first offer was withdrawn before any acceptance or rejection, the second was conditional on finance which was not obtained, and the third was submitted after the vehicles had already been sold. The appellants failed to prove any breach or prejudice by Wesbank that would release them from liability as sureties. The court further held that Wesbank complied with its obligations under the Insolvency Act and that the sale of the vehicles was valid. The appellants' miscellaneous d…

Source excerpt

• Suretyship Liability
• Mitigation Of Damages
• Release Of Surety
• Insolvency Act Application
• Public Policy Defence
• Credit Agreements

Servochem (Pty) Ltd v Geldenhuys and Others (2012/22072)

Servochem (Pty) Ltd v Geldenhuys and Others (2012/22072) [2017] ZAGPJHC 117 (15 February 2017)

Court

South Gauteng High Court, Johannesburg

Case number

2012/22072

Judge

K E Matojane

The High Court upheld a claim on a signed suretyship, finding no proof that the defendants had been released from liability or misled about the terms.

• Suretyship
• Release Of Surety
• Contractual Liability
• Shareholders Agreement
• Fraudulent Misrepresentation
• Contract-law

Dominick v Nedbank Limited (20463/14)

Dominick v Nedbank Limited (20463/14) [2015] ZASCA 160 (13 November 2015)

Court

Supreme Court of Appeal

Case number

20463/14

Judges

Mpati, Cachalia, Petse, Dambuza, Gorven

The Supreme Court of Appeal held that the appellants, as sureties, were not entitled to release from their obligations under the suretyship agreements. The court found that any prejudice suffered by the appellants did not result from a breach of legal duty or obligation by Nedbank. The bank acted within its rights under the principal agreement and the suretyships, including the extension of overdraft facilities and the application of set-off. The transfers from the overdraft account to the Agri account were made at the request of Puricare or its attorneys, and Nedbank was not in breach of any…

Source excerpt

• Suretyship Liability
• Prejudice To Surety
• Set Off
• Extension Of Banking Facilities
• Release Of Surety

Antalis South Africa (Pty) Ltd v C N.O. (73947/2010)

Antalis South Africa (Pty) Ltd v C N.O. (73947/2010) [2014] ZAGPPHC 484 (20 March 2014)

Court

North Gauteng High Court, Pretoria

Case number

73947/2010

Judge

Makhubele AJ

The court held that the respondents' obligations as sureties were not extinguished by the applicant's receipt of payment from Fastpulse Trading 368 (Pty) Ltd, nor by the subsequent payment to Capital Assurance. The suretyship agreement expressly permitted the applicant to make arrangements with other sureties and did not require the release of the respondents upon payment by another. Prejudicial conduct by the creditor does not, in itself, release a surety unless it constitutes a breach of a legal duty or obligation. The applicant's conduct was found to be within its contractual rights and no…

Source excerpt

• Suretyship
• Release Of Surety
• Prejudicial Conduct
• Quantum Of Debt
• Execution Of Judgment

Nedbank Ltd v Puricare CC and Others (18922/2010)

Nedbank Ltd v Puricare CC and Others (18922/2010) [2014] ZAWCHC 17 (18 February 2014)

Court

Western Cape High Court, Cape Town

Case number

18922/2010

Judge

Rogers

The court held that the Dominick defendants failed to establish that Nedbank's conduct constituted a breach of any legal duty or obligation under the principal agreement or the suretyship contracts. The facility agreement and suretyships expressly authorised Nedbank to determine the extent and nature of banking facilities and to honour debit requests at its discretion. The absence of a facility agreement did not preclude Nedbank from honouring Puricare's debit requests, and the suretyships covered all indebtedness arising from any cause. The court found no evidence of mala fide conduct by Ned…

Source excerpt

• Suretyship Liability
• Prejudicial Conduct By Creditor
• Facility Agreement
• Non Variation Clause
• Set Off Rights
• Release Of Surety

HNR Properties CC and Another v Standard Bank of SA Ltd (485/02)

HNR Properties CC and Another v Standard Bank of SA Ltd (485/02) [2003] ZASCA 135; [2004] 1 All SA 486 (SCA); 2004 (4) SA 471 (SCA) (28 November 2003)

Court

Supreme Court of Appeal

Case number

485/02

Judges

Scott, Navsa, Nugent, Lewis, Motata

The court held that a facilities letter did not release sureties where the suretyship required written release, and waiver or estoppel could not bypass that formality.

• Suretyship
• Release Of Surety
• Non Variation Clause
• Waiver
• Estoppel
• Reliance Theory Of Contract

Bock and Others v Duburoro Investments (Pty) Ltd (228/2002)

Bock and Others v Duburoro Investments (Pty) Ltd (228/2002) [2003] ZASCA 94; [2003] 4 All SA 103 (SCA); 2004 (2) SA 242 (SCA) (26 September 2003)

Court

Supreme Court of Appeal

Case number

228/2002

Judges

Harms, Zulman, Farlam, Navsa, Van Heerden

The Supreme Court of Appeal held that the banks did not exercise parate executie but rather took over the pledged shares at a fair price in accordance with the terms of the pledge agreements. The amounts credited to the principal debtors were above the ruling market prices, and there was no evidence of prejudice to the sureties. The court reaffirmed that there is no general principle in South African law that any prejudice to a surety automatically releases them; release only occurs if there is a breach of a legal duty or obligation. The terms of the deeds of suretyship and pledge agreements…

Source excerpt

• Suretyship
• Parate Executie
• Pactum Commissorium
• Pledge Of Shares
• Release Of Surety
• Quantification Of Debt