FORM A FILING SHEET FOR EASTERN CAPE HIGH COURT, GRAHAMSTOWN NOT REPORTABLE PARTIES: MBANJWA INC AND ALBANY AUTO TRIMMERS Registrar: CA 127/09 Magistrate: High Court: EASTERN CAPE HIGH COURT, GRAHAMSTOWN DATE HEARD: 31 JULY 2009 DATE DELIVERED: 13 AUGUST 2009 JUDGE(S): KROON J & EKSTEEN AJ LEGAL REPRESENTATIVES Appearances: for the Plaintiff(s)/Applicant(s)/ Appellant(s): ADV J KAYSER for the Defendant(s)/Respondent(s): NO APPEARANCE Instructing attorneys: Plaintiff(s)/ Applicant(s)/Appellant(s): MILI ATTORNEYS Defendant(s)/Respondent(s): NO APPEARANCE CASE INFORMATION - Nature of proceedings :
IN THE HIGH COURT OF SOUTH AFRICA (EASTERN CAPE, GRAHAMSTOWN) 2 CASE NO: CA 127/2008 Date delivered: 13 August 2009 In the matter between: C Z MBANJWA INCORPORATED Appellant and ALBANY AUTO TRIMMERS Respondent JUDGMENT 1. The appellant, a firm of attorneys, performed legal services on behalf of the Respondent, collecting outstanding debts. In January 2004 the appellant issued summons against the respondent in the magistrate s court of King William s Town in which it claimed an amount of R12 411.42. The relevant part of the particulars of claim allege: 3. Plaintiff s claim against the Defendant is for payment of R12 411.42 being for professional services rendered by the Plaintiff to the Defendant at the latter s special instance and request.
3 4. Notwithstanding reasonable demand the Defendant refuses, fails and/or neglects to pay the said amount. 2. The respondent raised a special plea of prescription and pleaded over to the averments set out above. In its special plea the respondent alleges that the work was done, services rendered and disbursements incurred during 1999, more than three years prior to the issue of summons. In its plea over the respondent merely denies that the amount of R12 411.42 or any other amount is due and payable and puts the Appellant to the proof thereof. 3. The appellant responded to the plea by way of replication in the following terms: Plaintiff s fees became due and payable by the Defendant to the Plaintiff on or about 1999 and were demanded. The Defendant became engaged with the Plaintiff by way of correspondence since the year 2000 until the year 2001 June when Defendant clearly admitted its indebtedness to the Plaintiff and started paying to the Plaintiff per letter dated 14 June 2001. Summons was thereafter issued and served on the Defendant on 15 th March 2004 before the expiry of three years and thereby prescription was interrupted. 4. On these pleadings the special plea was enrolled for hearing. The only issue between the parties was whether the running of prescription had been interrupted by the events which occurred in June 2001. No evidence was
4 tendered at the hearing save for a bundle consisting of three documents which was handed in as exhibit A by the appellant during argument, without objection. 5. The first document of this bundle is a letter from Messrs Hutton & Cook Incorporated, attorneys acting for the respondent, dated 23 May 2001. It records as follows: We confirm we now hold certain monies in trust on behalf of Albany Auto Trimmers. The amount is however not the full outstanding amount owing to yourselves. We therefore would like to receive clarity from yourselves whether we may pay the money over to yourselves, you will furnish us with the respective files which we have then paid for. 6. The second document is the letter upon which reliance is placed in the replication from Messrs Hutton & Cook Incorporated dated 14 June 2001, which reads as follows: Your letter of 4 th June 2001 refers. We enclose herewith our cheque in the sum of R716.03 and would be pleased if you would kindly furnish us with the following files:
5 Fanie Malinga Your outstanding fees R414.19 Julius Magena Your outstanding fees R301.13 A Noqayi no fees outstanding. We look forward to receiving same at your earliest convenience. 7. The final document is a copy of a receipt issued by the appellant acknowledging receipt of the sum of R716.03. 8. On consideration of argument the magistrate upheld the special plea with costs. It is this finding which is now challenged on appeal. 9. It is common cause that the professional services upon which reliance is placed were rendered during 1999. In the ordinary course the debt sued on would therefore have become prescribed by no later than the end of 2002. Section 14(1) of the Prescription Act, 68 of 1969 ( the Act ), however, provides for the interruption of the running of prescription if there is an express or tacit acknowledgement of liability by the debtor. In terms of Section 14(2) of the Act, once the running of prescription is interrupted the prescriptive period commences to run afresh. 10. The onus to establish an interruption of prescription rests on the creditor. (See: Pentz v Government of the Republic of South Africa 1983(3) SA 584 (A)).
6 11. In Agnew v Union and South West Africa Insurance Company Limited 1977 (1) SA 617 (A) at 623A Muller JA, said: Of daar in n bepaalde geval n erkenning van aanspreeklikheid was, is 'n feitlike vraag wat betrekking het op die bedoeling van die persoon wat as skuldenaar aangespreek is. In dié verband het Broome RP die volgende gesê in Petzer v Radford (Pty) Limited 1953 (4) SA 314 (N) te 317, 318: To interrupt prescription an acknowledgement by the debtor must amount to an admission that the debt is in existence and that he is liable therefor... What we are concerned with is the state of mind of the debtor: did he intend to admit that the debt was in existence and that he was liable therefor? (See Also: Markham v SA Finance and Industrial Company Limited 1962 (3) SA 669(A) at 676; and Benson & Another v Walters & Others 1984 (1) SA 73 (A) at 86H 87B.) 12. Marais AJ, in Cape Town Municipality v Allie N.O 1981 (2) SA 1(C), considered the test to be applied and at 7H, he said:... the test is objective. What did the debtor s conduct convey outwardly? I think this must be so because the concept of a tacit acknowledgement of liability is irreconcilable with the debtor being permitted to negate or nullify the impression which his outward conduct conveyed, by claiming ex post facto to have had a subjective intent which is at odds with his outward conduct.
7 13. In interpreting Section 14 of the Act, full weight must be afforded to the legislature s use of the word tacit. In order to give effect thereto the words and conduct of the debtor must be viewed in their context, holistically. Thus, where prior conduct may cast light on the interpretation which should be accorded to later conduct which is said to constitute an acknowledgement of liability such later conduct should be considered in the context of that which preceded it. (Compare: Cape Town Municipality v Allie N.O supra at 7D G.) 14. Reverting to the facts of the present matter, the letter of 14 June 2001, exhibit A2, which was accompanied by a cheque in the sum of R716.03 must be considered in accordance with the aforegoing approach. It was preceded by the letter of 23 May 2001, exhibit A1. Exhibit A1 was written by Messrs Hutton & Cook, attorneys acting on behalf of the Respondent. The letter bears the heading: Albany Auto Trimmers/various debtors. 15. In the first paragraph the letter confirms that the said attorneys hold certain monies on behalf of the respondent. It proceeds to record: The amount, however, is not the full outstanding amount owing to yourselves. The second paragraph of this letter, although not a model of clarity, then proceeds to enquire whether, if part payment of the debt is made, the appellants would be prepared to release certain files to the extent that the part payment covers the fees raised in respect of those files. Viewed in its context and according to the words therein their ordinary English meaning I consider that it can safely be said that this letter conveys at least three messages unequivocally.
8 16. First, it acknowledges an existing debt which the respondent owes to the appellant. Second, it confirms that attorneys Hutton & Cook hold money on behalf of the respondent in order to discharge part of the existing debt. Thirdly, it acknowledges that the amount held by Messrs Hutton & Cook was inadequate to discharge the entire debt then in existence. 17. It is against this background that the letter of 14 June 2001 is written which was accompanied by the cheque. This letter cannot be viewed in isolation. It falls to be considered in the context of the prior acknowledgements. In my view, when the payment made on 14 June under cover of the letter referred to is viewed in the context of the preceding communication it cannot be other than an acknowledgement of the respondent s liability for the debt which was accompanied by a tender to make payment of part of the full outstanding amount owing. 18. In the circumstances I am of the view that the appellant has established that the prescription was interrupted on 14 June 2001. The prescriptive period therefore began to run afresh on 14 June 2001. Summons was accordingly issued and served prior to the completion of the period of prescription. In the circumstances I am of the view that the appeal should succeed and that the order of the magistrate should be set aside and replaced by the following order: The special plea is dismissed with costs. 19. At the hearing Counsel acting on behalf of the appellant s indicated that the
9 appellant would not seek an order for costs of the appeal if the appeal succeeds. No order is accordingly made in that regard. Court J W EKSTEEN Acting Judge of the High I agree. The appeal succeeds. The order of the magistrate is set aside and is replaced with the following order: The special plea is dismissed with costs. F KROON Judge of the High Court