CASE NO: 2103/2013 In the matter between - SAFLII · 2021. 2. 16. · 1 in the north west high...
Transcript of CASE NO: 2103/2013 In the matter between - SAFLII · 2021. 2. 16. · 1 in the north west high...
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IN THE NORTH WEST HIGH COURT, MAFIKENG
CASE NO: 2103/2013
In the matter between:
BAKGATLA-BA-KGAFELA STRATEGIC
INVESTMENT COMPANY (PTY) LTD Plaintiff
and
ARMANDO MENEGUZZO 1st Defendant
MARCELLO MENEGUZZO 2nd Defendant
DATE OF HEARING : 22 MAY 2017
DATE OF JUDGMENT : 01 JUNE 2017
COUNSEL FOR THE APPLICANT : ADV. BECKERLING SC
with ADV. STEYN
COUNSEL FOR THE RESPONDENT : ADV. LIMBERIS SC
JUDGMENT
Reportable: YES / NO
Circulate to Judges: YES / NO
Circulate to Magistrates: YES / NO
Circulate to Regional Magistrates: YES / NO
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HENDRICKS J
Introduction
[1] The Plaintiff, a limited liability private company registered as such in
South Africa, instituted an action on 16th October 2014 against the
First and Second Defendants, who are respectively father and son.
The Plaintiff claims three payments. The first claim is for a creditors
loan in the amount of R2 787 760.37; the second claim is for an
operational loan to the sum of R5 484 048.00; and the third claim is
for a key-man payment to the sum of R1 000 000.00.
[2] These three claims are allegedly due pursuant to a Memorandum of
Understanding, (MoU) as rectified, concluded between the Plaintiff
and the Defendants at Mogwase on the 15th August 2010. In the
alternative, the Plaintiff allege that these claims are due pursuant to
the MoU read together with a written loan agreement, as rectified. In
the further alternative, it is alleged that the three claims (debts) are
due by the Defendants pursuant to an e-mail agreement that was
concluded between the Plaintiff and the Defendants. For purposes of
this judgment it is not necessary to deal with these claims in much
detail. The reason for this will become apparent later on in this
judgment.
[3] The Defendants raised a special plea of prescription. In his special
plea, the First Defendant alleged that the three debts claimed from
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him pursuant to the MoU, as rectified, had been extinguished by
prescription by virtue of the provisions of Section 11 read with
Sections 10 and 12 of the Prescription Act 68 of 1969. The three
claims became due on the 15th February 2011 and the action was
instituted on the 16th October 2014, after the expiry of three (3) years.
Furthermore, that part of the three debts claimed in pursuance to the
MoU, as rectified, read together with the loan agreement, as rectified,
which had arisen prior to 16th October 2014 had been extinguished by
prescription for the same reason. The same special plea of
prescription was also raised with regard to the further alternative
claim based on the e-mail agreement, as rectified, since the Plaintiff
alleged that the three debts became due on the 7th February 2011
and the action was instituted after the lapse of a three (3) year period.
[4] The Plaintiff filed a replication in which it denied that any of its claims
had been extinguished by prescription. It pleaded that the completion
of prescription was delayed and it remains delayed by virtue of the
provisions of Section 13 (1) (b) of the Prescription Act because both
Defendants are outside the Republic of South Africa.
[5] The First Defendant filed a rejoinder in which he averred that he was
permanently resident in Italy at all material times and that the
provisions of Section 13 (1) (b) of the Prescription Act are not
applicable to him since it apply only to a resident of the Republic of
South Africa who is temporarily outside the Republic of South Africa
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and who is expected to return to the Republic of South Africa. In
answer to this, the Plaintiff filed a sur-rejoinder in which it alleged that
Section 13 (1) (b) of the Prescription Act applies to a debtor who is
outside the Republic of South Africa.
[6] At the inception of the hearing of this matter, the parties agreed to
separate the issue of prescription from the remaining issues in
dispute. A draft consent order was prepared in the following terms:
6.1 The issue of prescription is separated from the remaining
issues
in dispute between the parties;
6.2 The issue of prescription is to be dealt with separately from and
prior to the remaining issues in dispute between the parties;
6.3 The hearing on the remaining issues in dispute is stayed
pending
the determination of the issue of prescription.
An order was granted in the aforementioned terms and arguments
were presented only on the issue of prescription.
Common Cause Facts
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[7] It is common cause between the parties, alternatively not seriously
disputed, that both Defendants are peregrini to the Republic of South
Africa. The First Defendant is resident in Italy and the Second
Respondent is resident and employed in Namibia. The Defendants
consented to the jurisdiction of this Court in terms of the MoU and the
loan agreement, as rectified. The debts became due in terms of the
MoU and the loan agreement, as rectified, on 15th February 2011.
The citation and the intendit was served on the Second Defendant in
Namibia on 25th February 2014. He has not resided in the Republic of
South Africa since August 2011. The first Defendant is permanently
resident in Italy and the citation and intendit was served on him in
Italy on 16th October 2014.
[8] Mr Beckerling on behalf of the Plaintiff conceded that the main claim
against the First Defendant based on the MoU has been extinguished
by prescription. Furthermore, was it also conceded that part of the
first alternative claim for payment pursuant to the MoU read with the
loan agreement has been extinguished by prescription.
[9] The Defendants in their special pleas contended that like the main
and first alternative claims, the e-mail agreement has also been
extinguished by prescription. In the case of the First Defendant, the e-
mail agreement as rectified, became due on 07th February 2011 and
the action was instituted after the expiry of three (3) years because
summons was served on 16th October 2014. As far as the Second
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Defendant is concerned, the action was instituted on 25th February
2014, also after the expiry of three (3) years.
[10] In answer to this, the Plaintiff contended that Section 13 (1) (b) of the
Prescription Act finds application in that both Defendants were
outside the Republic of South Africa. This being the case, the running
of prescription was delayed until they ceased to be outside the
Republic of South Africa. The issue to be determined by this Court is
whether the further alternative claim against the First and Second
Defendants based on the e-mail agreement has been extinguished by
prescription.
[11] To put it differently, the issue for determination is whether section 13
(1) (b) of the Prescription Act finds application in the present matter
and if so whether: -
as contended for by the defendants, section 13 (1) (b) of the
Prescription Act only apply to a resident of the Republic of
South Africa who is temporarily outside the Republic and who is
expected to return to the Republic; or
as contended for by the plaintiff, section 13(1)(b) indeed applies
to a debtor (the defendants) that is outside the Republic.
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[12] It is therefore necessary to examine the e-mail agreement closely. It
is common cause that this agreement does exist between the parties.
Furthermore, there was also correspondence exchanged between the
two sets of attorneys. On 29th August 2014 the Plaintiff’s attorneys of
record send an e-mail to the Defendant’s attorneys stating:
“Dear Jonathan
Thank you for your email, and the draft affidavit.
We are not prepared to withdraw the application for summary
judgment, and ask that you file the final, signed affidavit
accordingly.
There seems to be some confusion as to whether the summons
was actually served on Armando Meneguzzo; the return of service
which we have from the sheriff reflects that it was served on him.
Should this not be the case, please advise whether you are
prepared to accept service on his behalf.
Should you not be willing to do so, in which event it will be
necessary for us to seek leave of the court to serve on him in Italy,
we confirm that we will seek a punitive costs order against your
client for this application, as you are clearly able to accept service
of the summons on his behalf, and he is patently aware of the
pending action against him.
Regards”
(emphasis added)
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[13] On 14th September 2014 the Defendants attorney replied with the
following e-mail addressed to Plaintiff’s attorneys:
“ARMANDO & MARCELLO M ENEGUZZO / BAKGATLA-BA-
KGAFELA STRATEGIC INVESTMENT COMPANY (PTY) LTD
CASE NO: 2103/2013
1. We refer to your client's application for summary judgement
postponed to 18 September 2014.
2. Attached is our client affidavit resisting summary judgement
which has been sent to our correspondent attorneys for
service and filing.
3. We submit that the affidavit discloses a defence and is
sufficient
to overcome summary judgement. Please therefore confirm
that the application is to be withdrawn with costs reserved and
that your client will agree for the court to grant our clients
leave to defend.
4. Alternatively, please advise whether your client intends to
proceed with the application, in which event we request that
the matter be postponed for argument to a date suitable to
both parties' counsel.
5. We have advised our client Armando Meneguzzo of your
client's request that we accept service of the indendit at our
offices. We are awaiting Mr Meneguzzo's instructions and will
revert in due course.”
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(emphasis added)
It is common cause between the parties that Defendant’s attorneys
(and so too the Defendants), never reverted to Plaintiff’s attorneys as
promised. They never consented to the request that they will accept
service of the intendit at their offices.
The Law
[14] Central to the determination of the issue at hand is the prescript of
the Prescription Act 68 of 1969. The relevant provisions of this Act
reads as follows:
“10. Extinction of debts by prescription. - (I) Subject to the
provisions of this Chapter and of Chapter IV, a debt shall
be extinguished by prescription after the lapse of the period
which in terms of the relevant law applies in respect of the
prescription of such debt. …”
"11. Periods of prescription of debts. - The periods of
prescription of debts shall be the following:
(a) …
(b) …
(c) …
(d) save where an Act of Parliament provides otherwise,
three years in respect of any other debt."
"12. When prescription begins to run. - (1) Subject to the
provisions of subsections (2) and (3), prescription shall
commence to run as soon as the debt is due. …”
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13. Completion of prescription delayed in certain circumstances.
- (1) If-
(a) the creditor is a minor/or is insane or is a person
under curatorship or is prevented by superior force
including any law or any order of court from
interrupting the running of prescription as
contemplated in section 15(1); or
(b) the debtor is outside the Republic; or
(c) the creditor and debtor are married to each other; or
(d) the creditor and debtor are partners and the debt is a
debt which arose out of the partnership relationship;
or
(e) the creditor is a juristic person and the debtor is a
member of the governing body of such juristic
person; or
(f) the debt is the object of a dispute subjected to
arbitration; or
(g) the debt is the object of a claim filed against the
estate of a debtor who is deceased or against the
insolvent estate of the debtor or against a company
in liquidation or against an applicant under the
Agricultural Credit Act, 1966 (Act No. 28 of 1966); or
(h) the creditor or the debtor is deceased and an
executor of the estate in question has not yet
been appointed; and
(i) the relevant period of prescription would, but for the
provisions of this subsection, be completed before or
on, or within one year after, the day on which the
relevant impediment referred to in paragraph (1), (b),
(c), (d), (e), (f), (g) or (h) has ceased to exist,
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the period of prescription shall not be completed before a
year has elapsed after the day referred to in paragraph
(i).
…”
"15. Judicial interruption of prescription. - (1) The running of
prescription shall, subject to the provisions of subsection
(2), be interrupted by the service on the debtor of any
process whereby the creditor claims payment of the
debt.
(2) …”
[15] In Extinctive Prescription by M.M Loubser the following is stated by
the learned author under the heading “The Policy Considerations
Underlining Extinctive Prescription” on page 24:
“In summary: the law of extinctive prescription is meant (1) to
ensure protection and fairness to the debtor-defendant; (2) to
enhance the effectiveness and efficiency of the courts; (3) to
promote societal stability; and (4) generally to achieve legal
certainty and finality in the relationship between debtor and
creditor. Extinctive prescription primarily serves the interests of the
debtor, who becomes exempt from performance, while judicial
economy and the smooth functioning of the legal system are also
served because parties are obliged to bring their disputes to the
courts without undue delay, so that they can be effectively
resolved. Extinctive prescription to some extent also serves the
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interests of the creditor, who benefits from certain knowledge of
the time after which it would be futile to institute action against the
debtor. Extinctive prescription ensures that there comes a time
between a creditor and a debtor when the books are closed.”
[16] It is necessary to have due regard to the relevant case law dealing
with this section in the Prescription Act and its predecessor. In
Grinaker Mechanicals (Pty) Ltd v Societe Francaise Industriale et
D' Equipment 1976 (4) SA 98 (C) the following appears in the
headnote:
“Having regard to the provisions of section 10 of the Prescription
Act, 18 of 1943, the periods of extinctive prescription prescribed in
section 3 (2) of the Act do not operate in favour of a peregrine
company that has never been present in the Republic of South
Africa.
There is nothing in the wording of section 10 of the Prescription
Act, 18 of 1943, to justify the conclusion that the Legislature
intended to confer the benefit of prescription upon a debtor who,
despite his continued absence from the Republic, became
amenable to be sued in respect of his debt in a Court of the
Republic (as a result of his property having been attached ad
fundandam jurisdictionem).”
Section 10 of that Act reads as follows: -
"When the debtor is absent from the Union (Republic of South
Africa) extinctive prescription shall not begin to run until the date of
his return."
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Having considered the meaning of the word "return" in section
10 the Court held as follows on page 102 E-H:
"It would seem to be unhelpful to confuse the question of the
amenability of a peregrine debtor to the jurisdiction of a
Republican Court with the question of when extinctive prescription
begins to run against a peregrine debtor who is absent from the
Republic. It is with the latter and not the former enquiry with which
the Court is concerned. It is fundamental to such an enquiry to
ascertain upon a proper construction of sec. 10 of Act 18 of 1943
when such prescription begins to run against such a debtor. There
is nothing in the wording, of sec. 10 to justify the conclusion that
the Legislature intended to confer the benefit of prescription upon
a debtor who, despite his continued absence from the Republic,
became amenable to be sued in respect of his debt in a
Republican Court. If that was the intention of the Legislature it
certainly has not been made apparent in the terms of sec 10.
It may be thought to be anomalous that a company debtor resident
outside the Republic could, in general, never enjoy the benefit of
prescription since it is but rarely likely to cease to be absent from
the Republic. This, however, cannot be said of a debtor who is a
natural person and who therefore could very readily cease to be
absent from the Republic. Sec. 10, however, draws no distinction
between these two types of debtor and the section cannot be
criticised on the ground that its provisions in all respects result in
an anomalous position. In any event I entertain some doubt as to
whether it could be described as anomalous for the Legislature to
withhold the protection of prescription from a debtor who never
ceases to be absent from the Republic. The Legislature, one
would assume, would be to more astute to favour an incola rather
than a Peregrinus.”
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(emphasis added)
[17] In Dithaba Platinum (Pty) Ltd v Erconovaal Ltd and Another 1985
(4) SA 615 (T), the applicant was a present holder of a right of first
refusal in respect of minerals. It sought an order against the
respondents for the cession to it of such rights against payment of the
book value thereof. The first respondent was a South African
company. It was also a wholly-owned subsidiary of the second
respondent. The second respondent, was an external company and
was registered as such in South Africa (under the provisions of the
1973 Companies Act).
A defence of prescription was raised. The Court held that prescription
began to run from the date on which the second respondent sold the
assets to the first respondent and not, as contended by the applicant,
when the applicant's right of first refusal was specifically rejected: the
fact furthermore that the second respondent was an external
company registered in South Africa did not mean that the debtor was
outside the Republic as envisaged by section 13(1) (b) of the
Prescription Act 68 of 1969 and that the running of prescription was
thereby delayed and accordingly, that the claim had become
prescribed as against the second respondent but not against the first
respondent The Court reasoned as follows in page 631 G – 632 C:
"The crisp issue is thus whether the second respondent, as an
external company, qualifies for the description of a "debtor...
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outside the Republic". It is common cause that the second
respondent is "a company registered with limited liability in terms of the
company laws of England… but also registered as an external company
in terms of the company laws of the Republic of South Africa... having
chosen as its registered office for such purpose 1st Floor, Afex House,
58 Marshall Street, Johannesburg, and carrying on business as a
finance company".
…
In my view, the consequence of the registration of its
memorandum in South Africa is that the second respondent
became a body corporate in the Republic. That is the plain and
unambiguous conclusion to be drawn from s 323 (1). As such, it
cannot be said to be a "debtor... outside the Republic". It is on this
simple basis that I hold that s 13 (1) (b) of the Prescription Act
cannot be invoked to delay the ordinary running of prescription in
favour of the second respondent. It is the operation of s 323 (1) of
the Companies Act which in my view distinguishes the present
case from the decision in Grinaker Mechanicals (Pty) Ltd v Societe
Francaise Industriale at d'Equipment 1976 (4) SA 98 (C).
Consequently, I am of the view that the applicant's claim as
against the second respondent (but, of course, not the first
respondent) has become prescribed."
(emphasis added)
[18] In Owner of the MV Maritime Prosperity v Owner of the MV Lash
Atlantico 1996 (1) SA 22 (AD) the ships of two peregrine of the Court
collided near Egypt damaging both ships. The applicant thereafter
caused an arrest of the respondent's ship in the Durban harbour. A
defence of prescription was relied upon by the respondent with the
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applicant contending that in terms of section 13(1) (b) of the Act
prescription was delayed.
The Court held that section 13(1) (b) of the Act applied to actions
in personam and that there was therefore no legal obstacle to the
applicant's reliance upon section 13(1) (b) to overcome the
consequences of the running of the two-year prescriptive period (in
terms of section 344 of the Maritime Shipping Act, 57 of 1951) and
that prima facie the objection to the security arrest of the respondent's
ship on the grounds of extinctive prescription was not well founded.
The question was not finally decided on the facts of the matter. The
Court held as follows on page 33 F – I:
“For these reasons I hold that s 344 (3) must be construed as
being confined in its application to actions in rem. Counsel for
appellant conceded that, in the event of this Court making such a
finding, the appeal had to fail. This concession was correctly
made. If s 344 (3) applies only to actions in rem then there can be
no inconsistency between that subsection and s 13 (1) (b) of the
Prescription Act as far as actions in personam are concerned. It
was common cause that Coastal's contemplated claim-in-
reconvention would constitute a proceeding in personam. Ergo
there is no legal obstacle to Coastal's reliance upon s 13 (1) (b) to
overcome the consequences of the running of the two-year
prescriptive period. Prima facie, therefore, Rosario's objection to
the security arrest of the Maritime Prosperity on the grounds of
extinctive prescription is not well founded. Consequently the Court
a quo correctly confirmed the arrest insofar as it relates to an
action in personam.
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I should perhaps add that in the circumstances it is not necessary
to decide the question whether, assuming s 344 (3) to apply to
actions in personam as well, there is necessarily an inconsistency
between s 13 (1) (b) and s 344 (3), read with s 344 (1). Nor is it
necessary to pronounce finally on the applicability of s 13 (1) (b) to
the facts of this case. Both questions are left open.”
[19] In Silhouette Investments LTD v Virgin Hotels Group LTD 2009
(4) SA 617 (SCA) the following was stated:
“Discussion
(i) Was the respondent 'outside the Republic' in terms of s 13 (1)
(b)?
[31] As appears from s 13 read as a whole the fact that a debtor
is outside the Republic (as a result of which the completion
of prescription is delayed) is regarded by the legislature as
an ‘impediment'. The various impediments listed in s 13 (1)
are circumstances which, as Professor MM Loubser puts it
in his work Extinctive Prescription at 117, ‘have in common
some legal or practical problem which makes it difficult or
undesirable for a creditor to institute proceedings for the
enforcement of his claim against the debtor'. See also ABP
4x4 Motor Dealers (Pty) Ltd V IGI Insurance Co Ltd
1999 (3) SA 924 (SCA) at 930I-931A, where it was said
that-
‘(t)he word impediment … covers a wide spectrum of
situations ranging from those in which it would not be
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possible in law for the creditor to sue to those in which it
might be difficult or awkward, but not impossible, to sue.’
Where, as in the present case, the debtor has not only
consented to the jurisdiction of the South African court but
also agreed to accept service of process, care of its South
African attorneys, there no circumstance which gives rise to
a problem which creates a difficult of undesirable situation
for a creditor seeking to institute legal proceedings against
the debtor in this country. Is it likely that Parliament would
have intended the completion of prescription to be delayed
in those circumstances? The only purpose that it would
serve would be to prevent prescription from ever being
completed against the respondent, which, as the
respondent's counsel submitted, would lead to an absurd
conclusion. It certainly would not advance the evident
purpose of the provision, which is to assist a creditor which
has a legal or practical problem in relation to the institution
of legal proceedings in South Africa against its debtor
[32] I think that to interpret the phrase ‘outside the Republic’ as
covering a case where, although the debtor itself is
physically outside the Republic, it has consented to the
jurisdiction of the South African courts in respect of a claim
and has a representative here whom it has authorised to
receive service on its behalf of any process in which the
claim in question is sought to be enforced would give a
meaning to the provision under consideration which
Parliament could never have intended.
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[35] The present case is of course stronger than the American
cases to which I have referred because here it was
possible for the appellant to serve the original summons on
the respondent not by substituted service but by service on
its own attorneys who were authorised to receive service
on its behalf.
[41] It is not necessary, however, in this case to decide whether
amenability to jurisdiction over the debtor personally in
circumstances where a judgment can be given which can
be enforced against him internationally will lead to the
conclusion that he is not to be regarded as 'outside the
Republic' for the purposes of s 13 (1) (b) of the Act. I say
that because I am satisfied that the combined effect of the
submission by the respondent to the court's jurisdiction and
the authorisation to its attorneys to accept service of the
summons clearly leads to the conclusion, for the reasons I
have stated, that it would go beyond the purpose of s 13 (1)
(b) if it were held that the respondent in this matter, despite
what it had done to remove any difficulty or awkwardness
which the appellant might otherwise have encountered in
an attempt to institute proceedings against it to claim the
debt allegedly owing in this matter, was 'outside the
Republic'. It follows that the first contention advanced by
the appellant's counsel must fail.”
[20] In my view, the present case is clearly distinguishable. Unlike in the
Silhouette case supra, the Defendants never consented to or was
amenable to accept service of the summons at the offices of their
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attorneys of record in the Republic of South Africa. Infact, they never
reverted to the request to accept same. On 14th September 2014 they
promised to revert about this aspect, but to no avail. In the Silhouette
case, the peregrine company Virgin Hotels Group LTD, which had
consented to the jurisdiction of the Court and which had authorised its
attorney in the Republic of South Africa to accept service of the
process was found not to be “outside the Republic” within the
meaning of Section 13 (1) (b) of the Prescription Act. This decision is
unsurprising because the difficulty or impediment with regard to
service was removed. Service of the process could quite easily have
been effected at the offices of the attorney in the Republic of South
Africa. Although what was stated in paragraph [41] of the Silhouette
judgment was merely obiter, it is nevertheless a strong persuasive
remark. This Court is bound to follow the presedent in the Silhouette
judgment with particular reference to paragraph [41].
The Constitutional Dimension
[21] Mr. Limberis on behalf of the Defendants contended that there is a
constitutional dimension to the interpretation of Section 13 (1) (b) of
the Prescription Act. According to him, there is an ambiguity in
Section 13 (1) (b) in that “debtor” should be narrowly interpreted to
apply only to an incola who is temporarily outside the Republic of
South Africa and who is expected to return to the Republic of South
Africa and not to peregrini because foreigners (peregrini) who trade
within the Republic will be punished and denied their substantive right
to raise extinctive prescription simply because they are “outside the
Republic”.
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[22] Section 13 (1) (b), so it was contended, is ambiguous in the sense
that it could be interpreted to apply only to an incola who is
temporarily absent from the Republic and who intends to return to the
Republic. Prescription would then be delayed during the incola's
absence from the Republic and for a year after his return. The
impediment would then be the difficulty in serving the process on
him/her whilst he/she was away. It could also mean that prescription
will be delayed forever in the case of a foreign corporation or natural
person who is outside the Republic and who does not intend ever to
take up residence in the Republic. If this interpretation is applied, that
person or entity will be deprived of his/her/its right to raise extinctive
prescription as a defence without sufficient justification therefor. It is
self-evident that the latter interpretation is the one which better
promotes the spirit, purport and objects of the Bill of Rights as
required by Section 39 (2) of the Constitution.
[23] Reference in this regard was made to the case of Arse v Minister of
Home Affairs 2012 (4) SA 544 SCA at paragraph [10] where the
following is stated:
“[10] …
In addition, s 39(2) of the Constitution requires courts when
interpreting a statute that is reasonably capable of two
interpretations to avoid an interpretation that would render
the statute unconstitutional and to adopt the interpretation
that would better promote the spirit, purport and objects of
the Bill of Rights, even if neither interpretation would render
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the statute unconstitutional. The detention of the appellant
is clearly in breach of the express provisions of s 34(1) (d)
of the Immigration Act and is unlawful. Indeed Mr Semenya
who appeared on behalf of the respondents quite properly
conceded this during argument.”
[24] In Investigating Directorate: Serious Economic Offences and
Others v Hyundai Motor Distributors (Pty) Ltd and Others 2001
SA 545 (CC) the following is stated:
“[21] Section 39(2) of the Constitution provides a guide to
statutory interpretation under this constitutional order. It
states:
'When interpreting any legislation, and when developing
the common law or customary law, every court, tribunal
or forum must promote the spirit, purport and objects of
the Bill of Rights.'
This means that all statutes must be interpreted through the
prism of the Bill of Rights. All law-making authority must be
exercised in accordance with the Constitution. The
Constitution is located in a history which involves a
transition from a society based on division, injustice and
exclusion from the democratic process to one which
respects the dignity of all citizens, and includes all in the
process of governance. As such, the process of interpreting
the Constitution must recognise the context in which we find
ourselves and the Constitution's goal of a society based on
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democratic values, social justice and fundamental human
rights. This spirit of transition and transformation
characterises the constitutional enterprise as a whole.
[23] In De Lange v Smuts NO and Others, Ackermann J stated
that the principle of reading in conformity does
'no more than give expression to a sound principle of
constitutional interpretation recognised by other open
and democratic societies based on human dignity,
equality and freedom such as, for example, the United
States of America, Canada and Germany, whose
constitutions, like our 1996 Constitution, contain no
express provision to such effect. In my view, the same
interpretative approach should be adopted under the
1996 Constitution.'
Accordingly, judicial officers must prefer interpretations of
legislation that fall within constitutional bounds over those
that do not, provided that such an interpretation can be
reasonably ascribed to the section.”
[25] In Wary Holdings (Pty) Ltd V Stalwo (Pty) Ltd and another 2009
(1) SA 337 (CC) the following is stated:
“[107] If a law is reasonably capable of two meanings, the
question whether the one meaning better advances the
constitutional project might raise a constitutional matter. It
was contended in this case that the meaning sought to be
given to the proviso by the applicant, the amici and the
Minister would better promote the spirit, purport and objects
24
of the Bill of Rights in that it would enable the State better
to fulfil some of its constitutional obligations. I think the
question whether the one interpretation is more in
accordance with the spirit, purport and objects of the
Constitution than the other does raise a constitutional
matter. But the constitutional matter would be raised for
decision only if the proviso is reasonably capable of having
two meanings. This issue whether the proviso is reasonably
capable of two meanings must be determined first, for if it is
not, the constitutional question does not arise for decision.
The question whether the proviso is reasonably capable of
two constructions is therefore an issue connected with a
decision on a constitutional matter and, in my view, we
have the jurisdiction to decide it."
[26] Mr. Beckerling contended with reference to the Wary Holdings
matter that at first there must be ambiguity in the legislation. He
submitted that there is no ambiguity in the wording of Section 13 (1)
(b) of the Prescription Act. He said that the wording of Section 13 (1)
(b) is unambiguous, simple and straightforward. The word ‘debtor’
should be accorded its ordinary meaning nl. “one who is indebted to
another”.
See: The Oxford English Dictionary. It does not matter , so it was
contended, whether it is an incola or a peregrinus. If he is a debtor
and he is outside the Republic of South Africa the completion of
prescription is delayed in terms of the provision of Section 13 (1) (b)
of the Prescription Act until he return to the Republic of South Africa
and for a year thereafter.
25
[27] Mr. Beckerling further submitted that reference to the equality
provisions in Section 9 of the Constitution of the Republic of South
Africa, Act 106 of 1996 simply means that everyone is equal before
the law irrespective whether (s)he is an incola or peregrinus. If (s)he
is a debtor, (s)he must be treated the same as any other debtor. To
do otherwise, amounts to discrimination. I fully agree with this
proposition. If the legislature wanted to treat a peregrinus different
from an incola, it would have stated it in the Act.
See: Grinaker Mechanicals (Pty) Ltd, supra.
[28] The time periods insofar as it relates to the further alternative e-mail
agreement are not in dispute. The net effect of this is that the claim in
the further alternative e-mail agreement is not extinguish by
prescription. The special plea insofar as this claim is concerned
cannot succeed and should be dismissed.
[29] Insofar as costs are concerned, Mr. Limberis on behalf of the
Defendants submitted that because of the concessions made by the
Plaintiff with regard to the main claim and the first alternative claim,
the Defendants are substantially successful and costs should be
awarded in favour of the Defendants. Mr. Beckerling on behalf of the
Plaintiff contended that both parties are to a certain extent successful.
In particular is the Plaintiff successful in so far as the further
alternative e-mail agreement claim is concerned and the appropriate
26
order should be that costs be costs in the cause. I am of the view that
this would be a sensible approach under the circumstances of this
case.
ORDER
[30] Consequently, the following order is made:
(1) The Plaintiff’s main claim against the First Defendant based on
the Memorandum of Understanding of 10th August 2010 for
payment of the sums of R2 787 760.37; R5 484 048.00 and
R1 000 000.00 has been extinguished by prescription.
(2) The Plaintiff’s alternative claim against the First Defendant for
payment of the first six instalments which became due during
the period 7th May 2011 to 07th October 2011 pursuant to the
Memorandum of Understanding read with the loan agreement
of 10th August 2010 has been extinguished by prescription.
(3) The special plea raised by the First Defendant against the
Plaintiff’s further alternative claim for payment of the sums of
R2 787 760.37; R5 484 048.00 and R1 000 000.00 based on
the e-mail agreement of 28th July 2011 is dismissed.
(4) The special plea raised by the Second Defendant against the
Plaintiff’s further alternative claim for payment of the sums of
27
R2 787 760.37; R5 484 048.00; and R1 000 000.00 based on
the e-mail agreement is dismissed.
(5) The costs of the special plea of prescription shall be costs in
the cause.
R D HENDRICKS
JUDGE OF THE HIGH COURT,
NORTH WEST DIVISION, MAHIKENG