De Klerk v Absa Bank Ltd and Others

• Jurisdiction: South Africa

De Klerk v Absa Bank Ltd and Others
2003 (4) SA 315 (SCA)

2003 (4) SA p315

Citation	2003 (4) SA 315 (SCA)
Case No	176/2002
Court	Supreme Court of Appeal
Judge	Marais JA, Schutz JA, Cameron JA, Cloete JA and Shongwe AJA
Heard	March 6, 2003
Judgment	February 18, 2003
Counsel	M C Maritz SC for the appellant.; Z F Joubert SC for the first, second, fourth and fifth respondents.; J F Roos for the third respondent.

Flynote : Sleutelwoorde H

Practice — Judgments and orders — Absolution from the instance — Test for — Reiterated that to escape absolution, plaintiff to I make out prima facie case — Must tender evidence on which court might or could reasonably find for him or her.

Practice — Judgments and orders — Absolution from the instance — When to be granted — Proof of damages — Sufficiency of — Quantification distinguished J

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from causation — Quantification depending not on proof on A balance of probabilities but on Court's estimation of likelihood of future state of affairs — In case of uncertainty, Court to make estimate in favour of plaintiff, provided 'best' evidence led — Plaintiff claiming damages resulting from loss of chance to invest — Plaintiff's expert testifying that plaintiff would probably have invested his money elsewhere (causation) B and that he would probably have received greater returns than that tendered by defendant (quantification) — Causation sufficiently established by evidence — Expert's evidence that alternative investment would have been more profitable best evidence of quantum — Damages prima facie established — Rest of evidence also such that Court might reasonably find for plaintiff — Absolution set aside. C

Damages — Proof of — Causation distinguished from quantification — Quantification depending not on proof on balance of probabilities but on Court's estimation of likelihood of future state of affairs — In case of uncertainty, Court to make estimate in favour of plaintiff, provided 'best' evidence led — Plaintiff claiming damages resulting from loss of chance to invest — Plaintiff's D expert witness testifying that plaintiff would probably have invested his money elsewhere (causation) and that he would probably have received greater returns than that tendered by defendant (quantification) — Causation sufficiently established by evidence — Expert's evidence that alternative investment would have been more profitable best evidence of quantum — Damages prima facie established. E

Evidence — Best evidence — What amounts to — Quantification of damages — In case of uncertainty, Court to make estimate in favour of plaintiff, provided 'best' evidence led — Plaintiff claiming damages resulting from loss of chance to invest — Plaintiff's expert testifying that plaintiff would probably have invested his money elsewhere (causation) and that he would probably have received greater F returns than that tendered by defendant (quantification) — Plaintiff failing to testify that he would have invested as predicted by expert — Expert's evidence best evidence.

Headnote : Kopnota

The question on appeal was whether absolution from the instance ought to have been granted against the plaintiff (the appellant in casu) in the Court a quo, a Provincial G Division. The appellant had claimed damages arising out of an allegedly fraudulent or negligent misrepresentation which had caused him to make a poor investment with the third respondent, an assurer. His claim was based on his averment that, had he invested the money invested with the third respondent in some alternative investment, he would have been much better off. He claimed the difference between what his investment with the third respondent had yielded and the return H that he would have obtained had the money been otherwise invested. One G, an actuary and the appellant's expert witness, having made certain assumptions as to how the appellant as a reasonable investor would have invested had he not invested with the third respondent, estimated his total loss at R111 800, the sum claimed. After closure of the appellant's case the respondents sought absolution on the basis I that the appellant had failed to testify that he would have acted in accordance with the assumptions made by G. The respondents argued, in other words, that absent such evidence, one of the essential legs of the proof of damage - that the appellant would have invested more advantageously elsewhere - was lacking. The Court a quo granted the application on the ground, inter alia, that the appellant had failed to lead J

2003 (4) SA p317

any evidence that could prove his loss, particularly, that he had not himself testified to the effect that he would have invested elsewhere A had the money been available to him.

Held, that the correct approach to an application for absolution was set out in Gordon Lloyd Page & Associates v Rivera and Another 2001 (1) SA 88 (SCA) at 92E - 93A: in order to escape absolution, the appellant had to make out a prima facie case - in other words, there had to be evidence on which the Court 'might' or 'could' reasonably find for the appellant. B (Paragraph [10] at 323B/C - F.)

Held, further, as to proof of damages, that it was important in the first place to note that the instant case was not one in which exact quantification was possible, and in the second place that causation had to be distinguished from quantification of damages since different standards of proof applied. As was pointed out in the English C case of Allied Maples Group Ltd v Simmons & Simmons (A Firm) [1995] 1 WLR 1602 (CA) at 1609E - 1610D and 1614C - E, causation required the establishment, on a balance of probability, of a causal link between the negligence and the loss, while quantification, where it depended on future uncertain events, was decided not on a balance of probability, but on the Court's assessment of the chances of the risk D eventuating. To establish causation the plaintiff had to prove a real or substantial chance as opposed to a speculative one, after which the chance was evaluated as part of the assessment of the quantum of damage, the range lying somewhere between that qualified as real or substantial on the one hand, and near certainty on the other. (Paragraph [28] at 328H - I and 329C - 330C.) E

Held, further, that if these dicta were transported to the facts of the instant case, the appellant would have had to have proved, on a balance of probability, that he would have invested elsewhere at least some of the moneys paid to the third respondent's scheme (causation). The Court would then quantify his damages by estimating his chances of earning the figure claimed (quantification). This figure would not have to be proved on a balance of probability but, rather, would be a matter of estimation. (Paragraph F [29] at 330C - D/E.)

Held, further, that the view of the Court a quo that the appellant himself was the only, or the best, person to testify that he would have invested elsewhere was wrong: the appellant was a man who acted on the advice of others and his conduct might well have been determined by the opinion of someone else. It was clear that a G Court would come to a plaintiff's aid in a case of uncertainty and make an estimate in his favour, provided he had led the best evidence available. (Paragraph [37] at 333F - H.)

Held, further, that it was dangerous to extrapolate from earlier cases a general principle as to 'best evidence' that the plaintiff must always personally state what he would have done. Facts may be proved not only by direct evidence but also by inference. Thus, H a man's intentions may be proved by the observations of others. (Paragraph [37] at 333J - 334A.)

Held, further, that it had to be borne in mind that in some of these earlier cases absolution was sought at the end of the whole case, when the requirements of proof by the plaintiff were at a much higher level than at the end of his case - 'ought to find' instead of 'might find'. The trial Judge's opinion that the appellant's failure to testify on I certain matters detracted from the allowable quantum was not a basis for absolution. (Paragraph [38] at 334D - E.)

Held, further, that most honest people in the position of the appellant would have been unable to say, other than in general terms, what they would have done with the money. The evidence of G, who was presumably impartial, might J

2003 (4) SA p318

well have been better evidence of quantum than any the appellant might have given, provided A that the prior conclusion had been reached that the appellant would have invested elsewhere. In any event, the Court would not be astute to entertain pessimistic speculations emanating from the respondents that the appellant might have been even worse off had he not made the investment he did. (Paragraphs [40] and [41] at 335E - H.)

Held, further, that the statement of the Court a quo that there was no evidence to support a conclusion that the B appellant would have found alternative investments was wrong: the appellant came across as a knowledgeable and active investor, and G's evidence could be reasonably read to mean that he had had regard to a spread of investments. The fact that G's figure was much higher than that of the third respondent was enough for a Court reasonably to find that it was reasonably possible that the appellant would have done C better. The more likely the Court considered that prospect to be, the higher would be its evaluation of the appellant's lost opportunity. (Paragraph [42] at 335J - 336C.)

Held, accordingly, that the appeal had to be allowed and the order of the Court a quo set aside and replaced with an order that absolution be refused. (Paragraph [44] at 336E.) D

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Annotations

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