Barclays National Bank Ltd v Traub; Barclays National Bank Ltd v Kalk

• Jurisdiction: South Africa
• Judge: Myburgh J
• Judgment Date: 16 March 1981
• Citation: 1981 (4) SA 291 (W)
• Court: Witwatersrand Local Division

Myburgh, J.:

In this matter the hearing of the case Barclays National Bank Ltd v A Kalk and that of Barclays National Bank Ltd v M Traub, have been combined because of the similarity of the dispute, and the overlapping of A evidence, save only that in the case against Kalk there is a counterclaim as a separate issue. In these judgments I shall refer to the pleadings in the Kalk case.

The case for the plaintiff, hereinafter referred to as the Bank, is based on a written guarantee and suretyship signed by Kalk on 24 June 1971 in favour of the Bank in consideration for the overdraft facilities allowed B for Dancor Land Holdings (Pty) Ltd of which Kalk was a director at that stage. The extent of the guarantees for overdraft was not limited. The relevant portions of guarantee to Barclays Bank are as follows:

"In consideration of your allowing banking facilities as hereinafter defined to Dancor Land Holdings (Pty) Ltd, hereinafter referred to as the said debtor, I/we, the undersigned do hereby guarantee and bind C myself/ourselves jointly as well as severally, where there are two or more parties hereto, as surety/ies in solidum and co-principal debtor/s to repay on demand by you or by the manager of any of your branches, to which the said debtor is indebted at the time of such demand all such sum or sums of money which may now or from time to time hereafter be owing to you anywhere by the said debtor either as principal or as surety and whether D solely or jointly with others or in partnership or otherwise and whether such indebtedness arise from money already advanced or hereafter to be advanced,...

It is agreed and declared that it shall always be in your discretion to determine the extent, nature and duration of the facilities to be allowed to the said debtor; that all admissions or acknowledgments of indebtedness by the said debtor shall be binding on me/us; that you shall be at E liberty, without affecting your rights hereunder, to release securities provided by or on behalf of the said debtor by any person, association of persons, firm or company, and to give time to, or compound or make any other arrangements with the said debtor or his legal representatives in insolvency, liquidation or otherwise..."

And finally:

"You are at liberty in your absolute discretion to give time to, release, F discharge or compound or make any other arrangements with any or more of the undersigned without in any way prejudicing your rights hereunder against the other or others of the undersigned."

For purposes that will appear later I may mention that similarly worded guarantees and suretyships were signed by the late L B Taurog, M Traub and J G G Anderson. By 23 November 1978 Dancor was indebted to the Bank in an G amount of R62 500,41 at an agreed rate of interest at 13½ per cent. This amount or any other amounts defendants failed to pay despite proper demand. Interest is calculated from 24 October 1978. The claim was H therefore for R62 500,41 plus interest thereon at 13½ per cent from 24 October 1978 to date of payment, and costs.

Subsequent to the issuing of summons certain amounts were paid by Dancor, which reduced the amount of the indebtedness to R60 416,80. In the pre-trial minutes under para 6 the following is recorded:

"Subject to the defences pleaded by the defendants, the defendants admit para 5 of the plaintiff's declaration but in the capital sum of R60 416,86 as at 31 October 1980."

It is not necessary to refer to the lengthy request for further particulars and replies thereto.

Myburgh J

The plea raised a number of defences. It was alleged that the interest charged was in excess of the Usury Act 73 of 1968. This plea has since been abandoned and I need not further deal with it. It was further A alleged that the written guarantee and suretyship was incomplete when it was signed by Kalk; because it was required to be completed by law, it was invalid. After lengthy cross-examination of Mr Van Wyk and Mrs Smith, two bank officials, the plea was also abandoned. The plea of prescription was B likewise abandoned. As the pleadings stood at the commencement of the hearing, only two defences have to be considered. The first relates to the so-called Taurog agreement with the Bank, and the second relates to the waiver of interest after the 23 October 1978. Towards the end of the hearing Mr Levin, on behalf of Mr Kalk, added a further defence relating C to the deregistration of Dancor on 21 December 1979. From this date it appears that Dancor was deregistered nearly one year after issue of the summons. The plea in respect of the Taurog agreement and the waiver of interest is as follows:

[The learned Judge then set out the plea, analysed the evidence adduced in D respect thereof and, after finding against the defendants thereon, continued as follows.]

I must next deal with the plea on the basis of the deregistration of Dancor. The plea I have noted as follows - it was introduced, as I have indicated, at some late stage in the proceedings:

"Additional defence (para 5(f) at p 49 of the plea):

Further alternative to (a), (b), (c), (d) and (e). Defendant states that: E

(i)

On or about 21 December 1979 and with knowledge and consent of the plaintiff, the debtor was removed from the register of companies in terms of s 73 (5) of the Companies Act as amended and in consequence of such deregistration, and by F operation of the law, the principal debt was extinguished.

(ii)

In the premises the obligation of defendant to plaintiff was likewise extinguished."

I merely repeat that the deregistration was approximately one year after litis contestatio. Mr Kuper did not object ot the granting of the G amendment and the introduction of this further defence and I have noted his replication as follows:

"Save for admitting that the principal debtor was deregistered on 21...