Nel v Waterberg Landbouwers Ko-operatieve Vereeniging

• Jurisdiction: South Africa
• Judge: Tindall JA, Schreiner JA and Feetham AJA
• Judgment Date: 29 May 1946
• Citation: 1946 AD 597
• Hearing Date: 29 March 1946
• Court: Appellate Division

Tindall, J.A.:

The respondent Society obtained judgment against the appellant for £2,396 18s. 9d in the Transvaal Provincial Division. The present appeal is brought against the judgment on the merits, and, alternatively, against that part of the judgment as to costs which ordered that the costs include costs between attorney and client. The declaration alleged that during the period 21st June, 1944, to 2nd August, 1944, the defendant, who was at the time, a member of the Society, represented to certain of its officials that he had during the said period delivered to the Society's store at Nutfield, district Waterberg, 199,583 lbs of ground-nuts and that on this representation the Society paid the defendant, various sums totalling the amount now claimed as a refund. It was further alleged that, in fact the defendant during the said period delivered no ground-nuts at all to the Society, that the defendant's representation was false and that he was not entitled to the payments which were made to him.

The defendant, who farmed in the district, did not dispute that he delivered no ground-nuts to the Society and he admitted that for many years he had not grown any ground-nuts. Nor did he dispute the receipt of the payments alleged. His defence was substantially the following: The Society's storeman at Nutfield, a man named Verster told him that he and another non-member, named Malan, were growing ground-nuts on equal shares, and Verster, the defendant, said, proposed to him that he should allow his name to be used for the purpose of disposing of the ground-nuts of Verster and Malan to the Society. The defendant stated that Verster

Tindall, J.A.

told him he would give him a commission out of the proceeds but that Verster did not mention the rate or the amount of the commission. The defendant agreed to Verster's proposal. I may state here that in March, 1943, the Minister of Agriculture had given this Society permission to purchase the ground-nuts of nonmembers and this permission was still in force at the time of the transactions in question in this case. Accordingly, in order to sell his ground-nuts to the Society, a non-member had no need to resort to the expedient of using the name of a member. Indeed, if the non-member did so and paid the member a commission, the nonmember would be paying two commissions, first, the commission which the society deducts on all sales and second, the commission paid direct by the non-member to the member.

In furtherance of the arrangement between the defendant and Verster, the latter, on various dates during the period, handed the defendant a number of weighing-in slips, each showing a specified weight of ground-nuts as having been received at the Society's store at Nutfield from the defendant. It is not disputed that the defendant presented the weighing-in slips at the society's office at Nylstroom and there received payment of the amount now reclaimed from him. There is no doubt that the Society made those payments to the defendant on the representation that he had delivered to the Society's store at Nutfield the ground-nuts specified in the weighing-in slips to the Society and that that representation was in fact false. But the defendant's evidence was that in the case of each weighing-in slip he believed that ground-nuts of Verster and Malan, of the specified weight, had been so delivered. In point of fact, no such ground-nuts had been delivered at all, and the position is that the defendant received Payment from the Society for a professed consideration which, in fact, was never given to the Society. On the undisputed facts, therefore, it is difficult to see what valid defence the defendant had to the Society's claim for a refund. But in view of the award of attorney and client costs, it is necessary to consider whether the Society established that the conduct of the defendant was fraudulent.

The defendant, in his evidence, failed to give a full account of the various sums received by him from the Society, of the amounts he retained and the amounts he handed over to Verster in the case of each payment. But in regard to the first amount received £280, on 27th, June, 1944, he stated that Verster allowed him a

Tindall, J.A.

commission of £86 10s., so he gave Verster his own cheque for the balance, namely, £193 10s. The defendant estimated the total amount of commission received by him at from £400 to £500. He also stated in evidence that on a certain occasion (the date of which he said was after a few of the payments in question had been received by him), van Ryneveld, the manager of the Society, in answer to a question by the defendant, replied that it was permissible for the nuts of non-members to be put through in the names of members van Ryneveld, in his evidence, denied having made such a remark. Verster was called as a witness by the defendant and he stated that he did not tell the latter that the ground-nuts shown in the weighing in slips had not been received. He said that he did not tell the defendant that there was fraud in the transaction and that, as far as he (Verster) knew, the defendant was not aware of any fraud.

The secretary of the Society, the witness Steyn, said that about 3rd August, when he signed a cheque for £648 in favour of the defendant, he remarked to the latter: "Mnr. Nel, jy het 'n besondere mooi grondboon oes gehad van jaar", and that the defendant replied that he had never previously had such a fine harvest on his farm. The ledger clerk testified to having heard this conversation. The defendant's version of the conversation was that Steyn asked whether he had a big harvest and he answered: "Ek maak iets uit...