Tesoriero v Bhyjo Investments Share Block (Pty) Ltd

• Jurisdiction: South Africa
• Citation: 2000 (1) SA 167 (W)

Tesoriero v Bhyjo Investments Share Block (Pty) Ltd
2000 (1) SA 167 (W)

2000 (1) SA p167

Citation	2000 (1) SA 167 (W)
Case No	A3103/98
Court	Witwatersrand Local Division
Judge	Schabort J, Wunsh J
Heard	May 19, 1999
Judgment	June 1, 1999
Counsel	H Dison for the appellant.; M M Segal for the respondent.

Flynote : Sleutelwoorde G

Husband and wife — Proprietary rights — Marriage in community of property — Provision in s 15(2) of Matrimonial Property Act that certain juristic acts requiring written consent of spouse — Qualification in s 15(6) that such consent not required where act in question performed 'in the ordinary course of . . . H profession, trade or business' of spouse — Wife with 50% interest in close corporation having entered into suretyship agreement for corporation's obligations in terms of lease of business premises — Wife actively involved in running of corporation's business — Having been aware of and approved lease — Not entitled to rely on s 15(2)(h) to escape liability under surety agreement.

Principal and surety — Action against surety — Defences — Justus I error — Surety signing suretyship agreement on behalf of close corporation in which she had 50% interest and in running of which she was actively involved — Agreement signed concurrently with and in respect of corporation's obligations in terms of agreement of lease of business premises — Deed of suretyship separate annexure separately signed — Wording thereof brief and simple — Surety not having enquired as to meaning or effect J

2000 (1) SA p168

thereof — Lessor's representative not having fostered any mistake made by surety A as to nature and contents of suretyship nor having been out to trap her — Clear from evidence that surety knew she was undertaking personal liability for obligations of lessee — Surety liable.

Headnote : Kopnota

The respondent sued the appellant in a magistrate's court for B amounts owed to it by a close corporation (S CC). The appellant and the respondent had concluded a suretyship agreement in terms of which the appellant had agreed to stand surety for S CC's obligations to the respondent under a lease agreement. It was agreed that the question whether the appellant was liable would be decided as a separate question, with the issue of quantum being left over. The C appellant raised the following defences: (1) that, because she was married in community of property, she had no contractual capacity to sign a deed of suretyship without her husband's consent; and (2) that she had been unaware that she was signing a deed of suretyship and accordingly had never intended to bind herself as surety (justus error). The appellant testified that she was married according to D Argentine law, which, she said, provided for community of property. No expert evidence regarding Argentine matrimonial law was, however, led. The appellant and one B each had a 50% interest in S CC. Its business was to manufacture and sell clothing. The appellant's job was to design and finish the clothing while B took care of administration and marketing. The subject of the lease was the premises from which S CC E conducted its business. On 23 March 1995 the appellant and B had each signed the lease agreement as well as an annexure headed 'Annexure 1 - Deed of Suretyship'. This was a simple document that stated that the appellant and B bound themselves 'as sureties for and co-principal debtors in solidum with (S CC)'. It was common cause that the respondent's representative did not tell the appellant F that she was signing a suretyship. On the first defence the magistrate found that the appellant had failed to prove what Argentine law provided and on the second she found that the appellant's ignorance of what she had signed was attributable to her own negligence, with the result that there was no justus error to excuse her from the consequences of her signature of the suretyship. The magistrate made no G finding regarding the appellant's contractual capacity but took the view that Argentine law applied and that the appellant had not proved that she lacked contractual capacity thereunder. The appellant was accordingly held liable for amounts owing by S CC in terms of the lease.

Held, as to (1) above, that a discussion of Argentine law was unnecessary: in the case of an ordinary commercial contract, contractual capacity was determined by the lex loci contractus and a deed of suretyship signed by one of two equal members of a close corporation who was involved in its business was an ordinary commercial contract. (At 171H - I/J.)

Held, further, that in the present matter the only country H with which the contract was connected and the country according to the law of which the merits of the case had to be decided (the lex causae) were the same, and under South African law there was a presumption that a married woman was married in community of property. (At 172H - I.)

Held, further, that the relevant provisions of the I Matrimonial Property Act 88 of 1984 were the following: s 11 (abolition of marital power), s 14 (equal power of spouses married in community of property), s 15(2)(h) (a spouse married in community of property prohibited from binding himself or herself as surety without the written consent of the other spouse), and s 15(6) (no such consent was required where the suretyship was signed by a spouse in the ordinary course of his or her profession, trade or business). (At 172I/J - 173A/B.) J

2000 (1) SA p169

Held, further, that it was clear from Amalgamated A Banks of South Africa Bpk v De Goede en 'n Ander 1997 (4) SA 66 (SCA) that, where a spouse signed a suretyship for a lease of business premises entered into by a trading corporation of which she owned one-half of the members' interest and in the business of which she was actively engaged, she did so in the ordinary course of her business. This disposed of any reliance by the appellant on s 15(2)(h) of the Act. (At 173A/B - B/C and 175E.) B

Held, further, as to (2) above, that the general principle was that, where a person who had signed a contract wished to escape liability on the ground of justified error as to the nature of the contents of the document, he or she had to show that he or she had been misled by some act or omission of the other contracting party and that the misrepresentation did not have to be fraudulent or negligent. (At 175E/F - G.) C

Held, further, that it could not be said in the present case that the respondent's representative had fostered any mistake made by the appellant as to the nature or contents of the suretyship or that he had been out to or had trapped her. The suretyship was a simple and distinct document that was separately signed. The appellant was a joint owner, active employee and agent of the corporation for the purpose of its business. She had signed the lease and the suretyship without D requiring any explanations. In the light of the evidence it was clear that the appellant must have been aware that she was undertaking personal responsibility for the obligations of the lessee. (At 176B/C - G/H and 179F - F/G.)

Held, accordingly, that the appellant had not discharged the onus of proving justus error. Appeal dismissed. (At 181A/B - B.) E

Cases Considered

Annotations

Reported cases

Amalgamated Banks of South Africa Bpk v De Goede en 'n Ander 1997 (4) SA 66 (SCA): discussed and applied

Diners Club SA (Pty) Ltd v Thorburn 1990 (2) SA 870 (C): distinguished F

Dlovo v Brian Porter Motors Ltd t/a Port Motors Newlands 1994 (2) SA 518 (C): dictum at 526F - J applied

Du Toit v Atkinson's Motors Bpk 1985 (2) SA 893 (A): applied

George v Fairmead (Pty) Ltd 1958 (2) SA 465 (A): dictum at 472A - B applied

Isaacson v Scheffer 1950 (1) SA 481 (T): G dictum at 483 applied

Keens Group Co (Pty) Ltd v Lötter 1989 (1) SA 585 (C): distinguished

Kempston Hire (Pty) Ltd v Snyman 1988 (4) SA 465 (T): distinguished

Kent v Salmon 1910 TS 637: dictum at 643 applied

Mans v Union Meat Co 1919 AD 268: applied

Mathole v Mothle 1951 (1) SA 256 (T): H dicta at 258G - H and 259B - D applied

McCann v Goodall Group Operations (Pty) Ltd 1995 (2) SA 718 (C): distinguished

Njobe v Njobe and Dube NO 1950 (4) SA 545 (C): applied

Powell v Powell 1953 (4) SA 380 (W): applied

Pretorius v Pretorius 1948 (4) SA 144 (O): dictum at 149 - 51 applied I

Roomer v Wedge Steel (Pty) Ltd 1998 (1) SA 538 (N): distinguished

Sentrachem Bpk v Wenhold 1995 (4) SA 312 (A): dictum at 320A applied

Shepherd v Farrell's Estate Agency 1921 TPD 62: applied

Spindrifter (Pty) Ltd v Lester Donovan (Pty) Ltd 1986 (1) SA 303 (A): applied

Wilson-Yelverton v Gallymore 1950 (2) SA 26 (D): applied. J

2000 (1) SA p170

Statutes Considered

Statutes A

The Matrimonial Property Act 88 of 1984, ss 11, 14, 15(2)(h), 15(6): see Juta's Statutes of South Africa 1998 vol 5 at 2-158.

Case Information

Appeal from a decision in a magistrate's court. The facts appear from the reasons for judgment.

H Dison for the appellant. B

M M Segal for the respondent.

Cur adv vult.

Postea (June 1).

Judgment

Wunsh J :

This is an appeal against a C judgment in the Johannesburg magistrate's court in which it was held that the appellant, who was the second defendant, was liable to the respondent, which was the plaintiff, for amounts which might be found to be owing by the first defendant, Sellavie Clothing CC ('the corporation'), to the respondent by reason of a deed of suretyship signed by the appellant for the corporation's obligations to the D respondent under a lease. Two actions for rent and charges payable by the corporation under the lease were dealt with together and it was agreed and ordered that the question whether the appellant was liable would be decided as a separate issue with the quantum being left over. E

The...