Durity Alpha (Pty) Ltd v Vagg

• Jurisdiction: South Africa
• Court: Appellate Division
• Judge: Hoexter JA, Smalberger JA, Milne JA, M T Steyn JA and Kumleben JA
• Judgment Date: 21 March 1991
• Citation: 1991 (2) SA 840 (A)
• Hearing Date: 26 February 1991

Hoexter JA:

E In the magistrate's court for the district of Durban the appellant company ('Durity') issued a summons against the respondent, Mr William Armour Vagg ('Vagg'), for payment of R1 883,99 together with interest thereon and costs. Vagg resisted the action and the magistrate gave judgment for Vagg with costs. Against the judgment of the magistrate Durity appealed unsuccessfully to the Natal Provincial F Division ('the Court a quo '). Subject to the condition that Durity should bear the costs of a further appeal irrespective of the result, the Court a quo granted Durity leave to appeal to this Court.

On 23 December 1985 a company called Natal Ironmongers (Pty) Ltd ('the seller') was incorporated. The seller began trading on 7 January 1986. G Vagg was the sole director of a company known as Tongaat Builders (Pty) Ltd ('the debtor'). During March 1986 the debtor bought goods from the seller and thereby became indebted to the seller in the sum of R1 883,99.

Durity carries on business as 'builders' merchants'. On 15 November 1982 Vagg signed a deed of suretyship ('the suretyship'). In terms of the suretyship Vagg bound himself in favour of each of a number of H companies ('the creditors') as surety for and co-principal debtor in solidum with the debtor for the payment of any sum of money which might then or thereafter become owing by the debtor to the creditors. The creditors were listed in a schedule incorporated in the suretyship, and Durity was one of them.

I On 2 July 1986 the Durban and Coast Local Division granted an order provisionally winding up the debtor. In due course the order was made final. In December 1986 Durity instituted its action against Vagg. In its summons Durity relied upon the suretyship signed by Vagg. From the further pleadings filed it appeared that Durity averred that when the debtor incurred its indebtedness of R1 883,99 to the seller the latter J was

Hoexter JA

A acting as the agent for an undisclosed principal in the person of Durity; and that, in suing Vagg, Durity '... has elected to make itself known as it is in law entitled to do'.

At the trial Vagg appeared in person. The plea to Durity's summons was also drawn up by Vagg. The plea is not ideally clear but it makes plain that Vagg challenged Durity's contention that when the debtor bought B goods from the seller the latter was acting as the agent of Durity as the undisclosed principal. Durity was represented by an attorney at the trial. Three witnesses were called on Durity's behalf: Mr B C Warner, Durity's financial manager; Mr A M Latter, the seller's managing director; and Mr H F W Hirsch, Durity's credit manager. Vagg was the C sole witness for the defendant. A full exposition of the pleadings in the action together with an analysis of the evidence given by Durity's witnesses is to be found in the judgment of the Court a quo, delivered by Broome J and concurred in by Alexander J, which has been reported: Durity Alpha (Pty) Ltd v Vagg 1989 (4) SA 1066 (N). In passing I point out a typographical error in the reported judgment: the date on which D the document, exh F, was signed (see the report at 1067C - D) was 27 May 1987. The fact that the judgment of the Court a quo has been reported renders here unnecessary, save in the respects later to be indicated, any recapitulation of the facts.

Following upon his review of the facts Broome J (see at 1069H - I) proceeded to consider whether Durity had succeeded in establishing a E case '... within the ambit of the two agreements it relied upon, suretyship and agency'.

The learned Judge dealt at once with an argument by counsel who appeared for Vagg in the Court a quo to the effect (see at 1070A) that Durity's reliance upon the suretyship was precluded by the provisions of F s 6 of the General Law Amendment Act 50 of 1956 as amended. Broome J upheld the argument (see at 1070A - 1072B); and this conclusion, so observed the learned Judge at 1072B - C, made it unnecessary for...