Absa Technology Finance Solutions (Pty) Limited v Thando Funeral Service CC

• Jurisdiction: South Africa
• Judge: F Kathree-Setiloane J
• Judgment Date: 17 April 2014
• Docket Number: 7283/2013
• Court: South Gauteng High Court, Johannesburg
• Hearing Date: 10 March 2014
• Citation: 2014 JDR 0893 (GSJ)

Kathree-Setiloane, J:

[1]

The plaintiff, Absa Technology Finance Solutions (Pty) Ltd instituted action against the first and second defendants jointly and severally, for the payment of the amount of R319 141.20 plus interest at the rate of 16.5% (interest at prime rate plus 6%) from date of service of summons, being 18 February 2010, to date of final payment, and costs of suit on the scale as between attorney and client. In additional, the plaintiff seeks an order that the first defendant return a New Itec C451 Colour Copier machine ("the machine") with serial number A000K040003664, failing which that the Sheriff or his deputy is authorised to attach, seize and hand over to the plaintiff the machine.

MASTER RENTAL AGREEMENT

[2]

The plaintiff's cause of action is founded on a written Master Rental Agreement ("MRA") concluded between the first defendant Thando Funeral Services, represented by the second defendant Mr MI Mathe, and a representative of Itec Finance (Pty) Limited ("Itec") on the 12th of December 2008 at Phuthaditjhaba. All of Itec's rights, title and interest in the MRA were ceded to the plaintiff by way of a written cession agreement concluded on 29 April 2004. The material terms of the MRA are as follows:

(i)

The rental period would be for 60 months;

(ii)

The monthly rental would escalate at a rate of 15% per annum (Clause 4.1);

(iii)

The first defendant would pay an initial rental in the amount of R4 788.00. The payments would be made without demand, and will not be subject to any set-off or counterclaim and shall be made without deduction of any nature (Clause 3.1);

(iv)

The first defendant would thereafter make payment of 59 monthly rentals in the amount of R4 788.00 per month subject to the annual escalation mentioned before;

(v)

The plaintiff would at all times be and remain the owner of the machine ("goods") and either the first defendant or any other

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person on its behalf shall at any stage before or after the termination of the MRA acquire ownership of the goods (Clause2.1.7);

(vi)

If the first defendant fails to effect any payment in terms of the agreement on the due date thereof, such overdue amount shall bear interest at the rate equal to 6% above the prime rate (Clause 3.3);

(vii)

If the first defendant defaults in the punctual payment of the monies as it falls due in terms of MRA, plaintiff may elect to immediately terminate the agreement without notice, take possession of the goods, retain all amounts already paid and claim all amounts which are in arrears at date of termination together with as pre-estimate liquidated damages, the future rentals which would have fallen due in terms of the MRA from the date of termination until the earliest possible date on which the MRA could have terminated by notice. (Clause 8.2);

(viii)

A certificate under the hand of any manager, as given from time to time, in respect of the indebtedness of the first defendant in terms of the MRA or in respect of any other fact shall be prima facie evidence of the first defendant's indebtedness to the plaintiff. It shall not be necessary to prove the appointment of the person signing the certificate (Clause 12);

(ix)

In the event of a breach of the MRA by the first defendant, then all costs and disbursements, including costs on the attorney and client scale, incurred by the plaintiff in recovering possession of the goods or in tracing the first defendant and locating the goods and in collecting or endeavouring to collect all or any amounts payable by the first defendant to plaintiff in terms of the MRA, shall be for the account of the first defendant (Clause 15.2);

(x)

The MRA is the complete and entire agreement between the parties. No agreement from the terms and conditions of this agreement, including consensual cancellation, shall be of any force or create any estoppel, unless it is in writing and signed by the parties to the MRA (Clause 14);

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(xi)

The first defendant acknowledges and warrants that:

(a)

the plaintiff gives no warranties in connection with the goods (Clause 2.1.3);

(b)

all warranties implied by common law are expressly excluded (Clause 2.1.4);

(c)

no representation of any nature whatsoever in connection with the goods are made by or on behalf of the plaintiff (Clause 2.1.5);

(xii)

The first defendant would only be entitled to cancel the MRA due to a material breach by the plaintiff of the obligations in terms of the MRA if the plaintiff has not remedied its breach within 14days of receipt of written notice from the first defendant calling upon the plaintiff to do so (Clause18).

[3]

The second defendant concluded a deed of suretyship in terms of which the second defendant bound himself as surety and co-principal debtor in solidum with the first defendant.

[4]

The defendants' defence is one of misrepresentation, which they allege induced the first defendant to enter into the MRA with the plaintiff. They accordingly deny that the MRA exists between the parties, as the second defendant was induced to sign the MRA by the representative of Itec, Mr Van der Walt ("Van der Walt") who knew that the first defendant intended a joint venture with one George Mahlatsi, which was conditional upon Mahlatsi providing the first and second defendants with financial statements relating to Mahlatsi's business for their and Itec's assessment; yet Van der Walt deliberately, alternatively negligently, represented to the second defendant that his initials and signature were required on the MRA to enable Itec to assess the first defendant's creditworthiness. The defendants furthermore allege that the MRA was not signed on 12 December 2008 at Phutadithjaba, but on 4 December 2008 at Reitz in the Free State.

[5]

The following facts are common cause between the parties:

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(a)

A validly enforceable cession agreement was concluded between the plaintiff and Itec Finance (Pty) Limited.

(b)

The second defendant's signature appears at page 1 of the MRA under the heading "SURETYSHIP".

(c)

The second defendant's signature appears as "User" on the Equipment Schedule to the MRA under the heading "SURETYSHIP".

(d)

The second defendant's signature appears under the heading "CERTIFICATE OF ACCEPTANCE" on the Equipment Schedule to the MRA.

[6]

In view of the defence of misrepresentation raised, the defendants correctly elected to adduce evidence first. The second defendant was the only witness to testify on behalf of the defendants. The plaintiff only called Mr Kugen Govender, a legal recoveries manager, whose testimony was limited to the certificate of indebtedness as provided for in the MRA. Mr Van der Walt who acted on behalf of Itec, and who is alleged by the defendants to have made the misrepresentation which purportedly induced the second defendant to sign the MRA was not called to give evidence on behalf of the plaintiff.

[7]

The material aspects of the second defendant's evidence can be summarised as follows: He has been a...