Grobler v Oosthuizen

• Jurisdiction: South Africa
• Judge: Brand JA, Cloete JA, Mlambo JA, Hurt AJA and Leach AJA
• Judgment Date: 26 May 2009
• Citation: 2009 (5) SA 500 (SCA)
• Docket Number: 299/2008
• Hearing Date: 12 May 2009
• Counsel: FWA Danzfuss SC (with H Murray) for the appellant. SP de la Harpe for the respondent.
• Court: Supreme Court of Appeal

Brand JA:

[1] The appellant, Mr Grobler (Grobler), instituted action against the respondent, Mrs Oosthuizen (Oosthuizen), and other defendants in the High Court, Kimberley. His particulars of claim incorporated various G causes of action supporting a number of claims against the different defendants. Of these only the first claim against Oosthuizen continues to be of relevance on appeal. Against this claim Oosthuizen filed a plea and a counterclaim. She also raised a special plea of prescription. At the commencement of proceedings, the parties agreed and the trial court H (Williams J) ordered that the special plea of prescription should be determined separately and prior to all other issues. At the end of the preliminary proceedings that followed, Williams J dismissed the plea of prescription with costs. Oosthuizen's appeal to the full court against that judgment was, however, successful. In terms of the judgment of the full court (Olivier J, with Majiedt J and Mokgohloa AJ concurring), Oosthuizen's I plea of prescription was therefore upheld with costs. Grobler's further appeal against the latter judgment is with the special leave of this court.

[2] In the main the background facts were presented to the trial court by way of a stated case. Certain circumscribed areas of dispute were, J however, reserved for the leading of oral evidence. But, as will appear

Brand JA

from what follows, even the evidence presented in this way proved to be A largely common cause.

[3] On 14 August 1991 Grobler entered into an agreement of sale with a company, Mothibi Crushers & Transport (Pty) Ltd. In terms of the agreement he purchased an immovable property situated at Mothibistat, in the erstwhile Republic of Bophuthatswana, from the company. In B entering into the agreement, Mothibi Crushers was represented by Oosthuizen's husband, Mr Gert Hendrik Oosthuizen, as its only shareholder and director, who has since passed away and to whom I shall henceforth refer as 'the deceased'.

[4] Payment of the purchase price was governed by the somewhat C unusual provisions of clause 2 of the sale agreement, which read as follows:

'2.

Die koopprys is die som van R300 000 tesame met rente teen 15% per jaar maandeliks gekapitaliseer vanaf 1 Julie 1991 tot datum van betaling, betaalbaar soos volg: op 30 Junie 2001, vir welke bedrag D die koper 'n polis by 'n goedgekeurde versekeringsmaatskappy uitneem, welke polis 'n opbrengs van R1 200 000 op 30 Junie 2001 waarborg en welke polis deur die koper aan die verkoper gesedeer word.'

Freely translated from the Afrikaans language, the clause thus determined E the purchase price at R300 000 together with interest at 15 %, capitalised monthly, from 1 July 1991 payable on 30 June 2001, for which amount the purchaser would acquire an insurance policy from an approved insurance company which guaranteed payment of R1,2 million on 30 June 2001, and which policy the purchaser would then cede to the seller. F

[5] In compliance with his obligations under clause 2, Grobler acquired not one but three policies from Sanlam Ltd, which cumulatively adhered to the stipulated requirements. By mutual agreement between the parties involved, these policies were, however, not ceded to Mothibi Crushers, but to the deceased in its stead. In point of fact, the cessions of the G policies preceded the sale in that they had been signed by Grobler on 8 August 1991. In terms of the sale agreement Grobler was obliged to pay the premiums in terms of the policies. For all intents and purposes he did so regularly until November and December 1996 when he fell into arrears. These two premiums were then paid by the deceased, for which Grobler compensated him in January 1997. H

[6] The deceased passed away on 27 January 1997. By that time the property had not yet been transferred to Grobler. Indeed, it was common cause between the parties at the trial that transfer could in fact never occur and that the agreement of sale was null and void from the start. I The reason for this, broadly stated, was that according to the laws of the erstwhile Republic of Bophuthatswana, where the property was situated, it could only be alienated to Grobler, who was not a citizen of Bophuthatswana at the time, with ministerial consent, which consent had never been obtained. In the beginning, so Grobler testified, he was not aware that the agreement of sale was void. This only came to his J

Brand JA

A notice after the deceased purported to cancel the agreement in December 1996 by reason of Grobler's failure to pay the premiums on the insurance policies.

[7] After the death of the deceased the executors in his estate made the B policies paid up. Thereafter they ceded two of the policies to Oosthuizen as the only heir in the deceased's estate. She thereafter claimed the surrender value of the policies from Sanlam who duly paid her the sum of R741 677,24 on 16 September 1997. Grobler's claim under consideration is for payment of this amount, for which he issued summons on 9 June 2000. Against this background the substructure of Oosthuizen's C plea of prescription can broadly be stated thus:

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The underlying basis for Grobler's claim as formulated in his pleadings, she said, is for re-cession of the policies which were ceded to the deceased in compliance with a deed of sale which proved to be null and void.

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D From the perspective of the deceased his obligation or 'debt' - as contemplated in Ch 3 of the Prescription Act 68 of 1969 - was therefore to re-cede the policies to Grobler.

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This debt, she said, 'became due' as envisaged by s 12 of the Act when the cessions occurred, because a claim for restoration of performance under a void agreement arises at the time when that E performance is rendered.

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Seeing that the period of prescription provided for in s 11(d) of the Act is three years, she said, Grobler's claim became prescribed in August 1994 which was long before the death of the deceased in 1997.

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F As a matter of law, so Oosthuizen's contentions concluded, a claim which has become prescribed against a deceased cannot be enforced by an enrichment claim against the heir, which is the ultimate basis of Grobler's claim.

[8] In this court counsel for Grobler conceded that if the cession of the G policies were to be classified as a so-called 'out-and-out' or outright cession, Oosthuizen's plea of prescription would be unanswerable. As I see it that concession was rightly and fairly made. In the event of an outright cession Grobler would have lost all his rights under the policies against Sanlam by transferring those rights to the deceased. Nothing would remain vested in him. The only way in which he could again H acquire those rights would be by way of re-cession of the policies. Because the cessions were effected in compliance with his obligations under an agreement which proved to be void, his claim for restoration in the form of re-cession would arise immediately, ie in August 1991. In consequence it would have been extinguished by prescription in August I 1994 (see eg Van Staden v Fourie1989 (3) SA 200 (A) at 214F - 215B).

[9] As formulated in his pleadings, Grobler's claim indeed appeared to rest on a claim for re-cession of an out-and-out cession of the policies to the deceased. This was pointed out and relied upon by Oosthuizen's counsel as his opening argument on appeal. I do not believe, however, J that that argument is available to Oosthuizen, at least not at this late

Brand JA

stage. From the outset and as the matter followed its meandering way A through two courts, Grobler's case had always been that the cession of the policies was not an out-and-out cession but a cession in securitatem debiti and that his claim was not founded on a re-cession of the policies. In the circumstances Oosthuizen could not be prejudiced in any conceivable way by Grobler's change of stance from his pleadings. That B much was rightly conceded on Oosthuizen's behalf. In these circumstances, I believe, it is no longer open to Oosthuizen to revert to a literal interpretation of Grobler's pleadings on appeal (see eg Shill v Milner1937 AD 101 at 105; Stead v Conradie en Andere1995 (2) SA 111 (A) at 112A - H; Fourway Haulage SA (Pty) Ltd v SA...