South Africa: Western Cape High Court, Cape Town
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IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
CASE
NO: 15893/22
In
the matter between
BAL
LOGISTICS (PTY) LTD T/A AFRICAN
APPLICANT
LOGISTIC
SERVICE
AND
MPACT
PLASTIC CONTAINERS (PTY) LTD
1st RESPONDENT
MPACT
PLASTIC CONTAINERS CASTLEVIEW
2nd RESPONDENT
(PTY)
LTD
CORAM:
THULARE J, PANGARKER J, ELLIOTT AJ
Date
of Hearing : 24 January 2025
Date
of Delivering : 30 May 2025
ORDER
PANGARKER,
J (ELLIOTT, AJ concurring):
I
would make the following order:
Clause
4 of the order of the court of first instance is substituted in
whole, and replaced with the following order:
“4. The applicants
pay into the trust account of the respondents’ attorneys
(Account number 0[…] held at Standard Bank
Winderemere branch)
the amount claimed to be due and payable, to wit, R19 717 827 -03, in
respect whereof the respondent contends
it holds a lien, to be held
as security in place of such lien, subject to the following:
4.1 The applicants shall
institute action in respect of its alleged claims in respect of the
goods and/or in relation to the security
in place of the lien or any
part thereof within 21 days of the grant of this order.
4.2 Should the applicants
fail to institute action in accordance with paragraph 4.1, the amount
paid as security together with any
interest calculated to date of
payment shall be paid to the respondent.
4.3 In the event that the
applicants’ action in paragraph 4.1 does not succeed, or
succeeds in part, the balance of the security
and interest calculated
to the date of payment, shall be paid forthwith to the respondent.
4.4 In the event that the
applicant’s action in paragraph 4.1 succeeds, or succeeds in
part, the security or the balance thereof
and the interest calculated
to the date of payment, shall be repaid forthwith to the applicants.”
The respondents are to
pay the costs of the appeal on a party to party costs on scale C, to
be taxed, such costs to include the
costs of two counsel where so
employed.
DRAFT
JUDGMENT
[1]
In this full court appeal the appellant sought the variation of an
order directing the release of goods held subject to a contractual
general lien and pledge against security which was R8 million less
than the claims secured. The appellant’s contention was
that
the court should not have made final findings on the affidavits in
urgent proceedings. The appellant submitted that the order
should
have provided for security for the full value of the amounts owing to
the appellant as secured by the general lien and pledge
subject to
proceedings being instituted to determine whether the security be
paid to the appellant or refunded.
[2]
The respondents were not party to the contract between the importer
(SDG) and the freight forwarder (ALS). The respondents’
submission was that as owners of the materials released, they were
not bound by any contractual lien or pledge in favour of the
appellant. The respondents argued that they had provided security
more than any enrichment claim the appellant may have. The
respondents’
submission was that the test to be applied in the
determination of the application on the affidavits for the release of
materials
from the detentor’s lien was different from the
ordinary and usual test as the relief, if granted, was temporary in
nature
and not a final determination. The respondents argued that by
the variation the appellant sought to relieve itself of the duty to
allege and prove the basis and quantum of its claims allegedly
secured by liens and a pledge and to place these duties on the
respondents, and this was not permissible.
[3]
Leave to appeal to the full court was granted by the Supreme Court of
Appeal. In the court of first instance the appellant was
a respondent
in an application wherein the present respondents sought an order to
make the goods held in its warehouses subject
to a lien, available
for collections and to deliver possession; for the respondents to pay
into trust amounts claimed due and payable
in respect of the
contention of lien as security subject to the appellant instituting
action in respect of the lien within 21 days
of the order; that the
respondents indemnify it against any claim in respect of such
delivery and that it provide full particulars
of the whereabouts of
the goods if it was no longer in possession as well as costs.
[4]
The goods had been delivered to the appellant’s warehouses by
Solomon David Group (SDG) before SDG went into business
rescue. The
goods were never in the respondents’ possession, and they were
held in the appellant’s warehouses. There
was no reference to
the respondents in the bills of lading which set out the shipping
parties in relation to the goods. There was
also no reference to the
respondents in what was called an EDI notification which was issued
by Customs and Excise in SARS to indicate
the release of the goods
imported and subject to duty. In other SARS documents SDG was the
importer. The respondents did not appear
anywhere in the relevant
documents. The respondents had to prove their alleged ownership of
the goods.
[5]
The appellant had undertaken to release the goods to the respondents
upon payment of all the amounts due to it in respect of
their
forwarding, clearance, transportation and storage to the respondents’
attorneys to be held in trust pending the respondents
indemnifying
the appellant from other claims and the fulfillment of other
conditions. The appellant’s opposition to the application
was
informed by the view that the respondents sought urgent relief under
a guise of a vindicatory application to which the respondents
were
not entitled. The appellants’ case was that the case was
ultimately about money, The respondents made it quite clear
that they
intended to use polypropylene (PP) and High-Density Polyethylene
(HDPE) pellets to produce finished products. The products
would be
consumed in use and therefore the relief that the respondents sought
was final.
[6]
The appellant operated in the freight forwarding and logistics
industry and provided warehousing as part of its services. The
appellant was one of the forwarding and warehousing companies which
the SDG used. The appellant acted as a freight forwarder and
arranged
for all freight forwarding, clearing and storage of goods imported by
SDG which involved inter alia arranging for and
paying all of the
expenses relating to the ocean transport and clearing of the cargo,
including the charges of the ocean carrier,
all port charges, import
VAT and import duties, all of which must be met before the goods will
be released, and then taking possession
of the goods at the port,
transporting the goods to warehouses and storing goods until released
or delivered on instructions of
SDG. The respondents sought an urgent
rei vindicatio in respect of goods it allegedly owned which
were held by the appellant in its warehouses in Cape Town,
Johannesburg and Durban.
The goods consisted of raw material used by
the respondents in their manufacturing processes, which goods were
about to run out
and to lead to a complete shutdown of their ability
to manufacture and result in irreparable financial losses. The
respondents
were leading suppliers of plastic containers and all of
their importing and ordering were carried out from their premises in
Atlantis,
Cape Town. For importing raw materials from the Middle, Far
East, Europe and the Americas, the respondents purchased and paid for
materials from SDG at a delivered cost, in other words, the price
paid included the delivery of the materials to any one of the
respondents’ plants. The respondents’ case was that
ownership of the materials passed to the respondent once the
materials
cleared customs into South Africa. The respondents
conducted frequent audits to ensure accurate records of stock levels.
[7]
The respondents conducted an audit on short notice and found large
discrepancies between their records of what should have been
in and
what was in stock. Subsequently the respondents discovered that
having paid for material in full, the respondents had yet
to receive
confirmation that the material was available. They had received bills
of lading but were told SDG was still waiting
for delivery. In
another instance whilst they were told that SDG was still waiting for
delivery but in fact the material had been
delivered a month before.
As at the date of proceedings, the respondents’ total stock of
material was 1 491 100 tons, of
which R56 150 tons were with another
warehouser. The balance was with the appellant, which on a simple
mathematical calculation
amounted to 1 434 950 tons. When SDG went
into business rescue the respondents attempted to conduct an audit of
stock in the warehouses
of the appellant and were denied access. The
respondents have since attempted to access and remove the stock,
without success.
The respondents tendered payment in respect of any
valid and enforceable lien that the appellant may have over the stock
that was
in the appellant’s warehouses, and the respondents
were willing to indemnify the appellant against the release of stock,
against any claim which any third party may have against the
appellant in respect of the stock so released. The appellant was
willing
to release the stock on condition that the claimed lien over
the stock was paid to it, and undertook to provide details of its
claimed lien. The parties have been unable to reach agreement on the
details of the claimed lien. This led to the urgent application.
[8]
The appellant did not appeal against the making of such order in
principle. Its appeal was directed at the amount of security
stipulated in the order and the terms of the order requiring that it
institute an action in respect of its alleged causes of action
as
secured by such lien. The appellant’s submission was that the
order had two adverse effects to it namely: (1) the order
summarily
divested it of the benefit of a debtor/lien general and special lien
and pledge over goods in its possession without
security at least to
the extent of R8 507 111-97 and (2) the order put it at risk of being
deprived of the benefit of that debtor/creditor
lien and pledge and
even an enrichment lien to the extent of the security ordered, that
of R11 210 715-06. In terms of the contract
between the appellant and
the SDG, inter alia, the appellant was afforded a special and general
lien and pledge over all goods
either for monies due in respect of
such goods or for other monies due to the appellant. The relevant
provisions are as follows
(Clause 38):
“LIEN
All goods and documents
relating to goods including bills of lading and import permits, as
well as all refunds, repayments, claims
and other recoveries, shall
be subject to a special and general lien and pledge either for monies
due in respect of such goods
or for other monies due to the company
from the customer, sender, owner, consignee, importer or the holder
of the bill of lading
or their agents, if any.”
[9]
The appellant’s case was that when SDG entered business rescue
in October 2023, SDG owed the appellant R28 160 413-51.
As at 20
October 2023 and in relation to goods imported by SDG for the
respondents, SDG was indebted to the appellant for such
freight
forwarding charges in a total amount of R19 717 827-03 which
comprised of R8 507 111-97 for goods already released and
R11 210
725-06 including storage charges calculated to the end of October in
relation to goods still in the appellant’s possession
and under
its control. The respondents demanded delivery of goods from the
appellant and the appellant’s response referred
to the general
and special lien and pledge and required payment of the full amount
of R19 717 827-03 and an indemnity. The respondents
brought an urgent
application issued on 18 October 2023 and heard on 20 October 2023 in
which they sought delivery of the goods
in possession of the
appellant and in the event that the appellant asserted a lien, that
the goods be released to the respondents
against a tender to provide
security in place of any valid lien which the appellant was able to
establish. No amount of the proposed
security was set out in the
draft order prayed for.
[10]
The appellant’s case was that the respondents claimed ownership
of the goods on clearing customs into South Arica, which
was a bald
statement. The respondents did not describe the process of delivery
as required under South African law for the transfer
of ownership of
movables and did not include any evidence of the transfer of
ownership from SDG to the respondents. The appellant’s
case was
further that the evidence relied on by the respondents indicated,
prima facie, that there was no opportunity for delivery
in any form
meeting the requirements of South African law necessary to effect the
transfer of ownership. The bills of lading were
non-negotiable
identifying SDG as the named consignee. This consequently precluded
the bills of lading operating as a document
of title and transferring
ownership of the cargo by virtue of negotiation or transfer of the
bills of lading, and the bills of
lading recorded this expressly. The
appellant cleared the cargo, took physical delivery and possession
thereof from the shipping
line and retained physical possession
thereof on the basis that it was SDG which was the owner of the cargo
and on whose behalf
it received and held the goods. The respondents
did not and could not contend that the appellant had agreed to hold
the goods on
behalf of the respondents as that might constitute the
requisite delivery in the form of attornmentatonement. In the
answering
affidavit, the appellant clearly set out that the
respondents had to allege and prove that they were the owners of the
goods. The
appellant indicated its challenge to ownership and amongst
others indicated that the goods were held in its warehouses, have
never
been in the respondents’ possession, there was no
reference whatsoever to the respondents in the bills of lading, there
was
no reference to the respondents on the clearing instructions,
which evidenced the owner, prima facie, as SDG. The
respondents’ details did not appear on the Customs and Excise
documents. In the business rescue application
for SDG, the affidavit
indicated that SDG had substantial stock in reserve stored at its
transporter’s warehouses, signalling
that according to SDG the
respondents did not own stock to which it lay claim.
[11]
On the other hand, the respondents explained the process. The
respondents would request SDG to provide a quotation for a specific
grade of raw material and SDG would provide a pro forma invoice on
which the respondents would pay a deposit of between 30% and
50%. SDG
would secure the material from its international exporters which
would then be shipped to South Africa. SDG would provide
the
respondents with a bill of lading which ordinarily recorded SDG as
consignee. The respondents would pay the remaining balance
due. Upon
clearing of the materials through customs, SDG would inform the
respondents that the materials were available for consumption
and
thereafter SDG would provide a final invoice to the applicants. The
respondents would pay a delivered price and SDG would see
to the
warehousing of the raw material until such time as it was required by
the respondents for manufacturing and at which time
and on request it
would provide material in the quantities required by the respondents
at one or other of their manufacturing plants.
As between the
respondents and SDG delivery of the material would be effected upon
the release of the material and the housing
thereof in warehouses.
According to the respondents, by the time the raw material was
warehoused, having cleared customs into South
Africa, the applicants
have paid in full for such material and are the owners thereof.
[12]
The respondents’ case was that the appellant’s statement
appeared to relate to consignments beyond simply those
relevant to
the application. It dated back to June 2023 and the respondents had
continued to draw down on the stock held in the
appellant’s
warehouses since June 2023 until they were refused access in October
2023. It was thus not clear on what basis
the appellant now asserted
any lien over the respondents’ property or at all. According to
the respondents, in simplified
form the argument was that the
respondents should be ordered to provide security to the full amount
allegedly owed by SDG to the
appellant in respect of a
debtor-creditor lien and pledge pursuant to a contract, whereto the
respondents was not a party, and
should the respondents seek to
recover the security in whole or in part it shall within a stipulated
time institute action against
the appellant challenging the liens or
the amount of the claims, failing which the security was to be paid
to the appellant. According
to the respondents the order now sought
showed that the appellant misunderstood the nature of a lien. A lien
did not entitle the
holder thereof to payment of the holder’s
claim without the need for it to establish such claim by means of
court procedure.
In effect, so the argument went, the appellant
sought an order that the respondents had to disprove the existence of
any lien as
well as the quantum of the appellant’s claim. The
respondents would have the onus to disprove a claim and the quantum
thereof
failing which the appellant would be entitled to payment
without it having to prove the existence and quantum of its alleged
claims.
Ownership
[13]
The most important derivative mode of acquisition of ownership in the
case of movables is delivery. To transfer ownership from
the
predecessor to the successor, there must be agreement between the
parties to transfer ownership and there must be a form of
conveyance,
which is delivery in movables. These two requirements, the mental
element and the physical element must be satisfied
for the transfer
of ownership [Wille’s Principles of South African Law,
9th ed, General Editor: F du Bois, 2007 at p 519 -520].
Attornment is a method of delivery which occurs when the property to
be transferred
is in the physical control of a third party who holds
it on behalf of the owner. Attornment is effected by a tripartite
agreement
between the parties concerned that the holder will
henceforth no longer hold the property on behalf of the transferor
but on behalf
of the transferee. It requires a tripartite agreement
or mental concurrence on the part of all three interested parties
that the
holder henceforth will hold the property on behalf of the
transferee and not on behalf of the transferor [Wille’s
Principles p 530 under para (f); The Law of Property,
Silberberg and Schoeman, 3rd ed p 263-269]. The person who
has detention of the goods must attorn the new owner, in other words,
the person who has detention
must agree to hold the property on
behalf of the transferee. The unison of the transferor and the
transferee alone is not sufficient.
The transferor must instruct the
person who has detention with the concurrence of the transferee, and
the person in detention must
with such concurrence agree to follow
the instructions. Then and then only is the delivery complete
[Caledon & SWD Eksekuteurskamer Bpk v Wentzel en Andere
[1972 (1) SA 270 (A) at 273A-C].
[14]
I am unable to agree with the court of first instance that the
appellant did not put up any facts to refute ownership. The
appellant
pointed out that there was no evidence of delivery of the goods to
the respondents. The appellant argued that delivery
was required by
South African law, for the transfer of ownership in movables from SDG
to the respondents. I am not persuaded that
the facts set out by the
appellant as to the movements of the goods from international
suppliers to the appellant’s warehouses,
and the appellant
specifically setting out that there was no role and even mention of
the respondents in the whole process, qualified
as opportunistic
contentions. They were facts which excluded the possibility of the
requisite delivery required by South African
law to transfer
ownership of movables. The facts are countervailing evidence as
regards the respondents’ alleged ownership.
These required
ventilation through judicial processing before a determination on the
respondents’ ownership could be made.
The question of disputed
ownership was not a matter which could be finally decided in favour
of the respondents on the papers,
as the court of first instance did.
The allegations in the answering affidavits of ALS were sufficiently
detailed to stand as an
answer to an inference of ownership being
made.
[15]
It seems that SDG claimed to have retained control of the stock and
acknowledged that the respondents at some stage, still
to be proved,
owned the stock and SDG retained the stock on behalf of the
respondents (constitutum possessorium) [Goldfinger’s
Trustee v Whitelaw & Son 1917 AD 66 at 74]. This form of
transfer of ownership might be used to cloak the real nature of the
transaction and as a result there is no
issue when it involves no
prejudice to third parties. However in instances like the present
where there is potential prejudice
to ALS, both SDG and the
respondents still had to establish bona fides [Goldfinger p
74]. In circumstances like the present where the rights of ALS are
concerned, where this form of delivery is established by intention
alone, it must be closely scrutinized to guard against the danger of
legal fraud in such dealings [Prinsloo v Venter 1964 (3) SA
626 (O) at 628-629]. In this case, against the background of the
disputed transfer of ownership, the court of first instance could not
simply overlook the danger and disregard its obligations to ensure
scrutiny of the constructive delivery suggested, with specific
regard
to the prejudice to the detentor, ALS. It is not necessary, on the
facts of this case, to enter the debate as to whether
the transfer
may be susceptible to another form of constructive delivery, whether
as an extension of constitutum possessorium or independent,
referred to as cession of the right of vindication [Barclays
Western Bank Ltd v Ernst [1988 (1) SA 243 (A) at 255A;
Page Automation (Pty) Ltd v Profusa CC t/a Homenet OR Tambo
2013 (4) SA 37 (GSJ) at para 16 to 29. ALS did not only hold the
stock. It also had a lien over the stock and had a material interest
in the transfer of ownership. The
transfer had serious implications
for ALS, and such transfer had to take into account such interest.
SDG could not simply ignore
ALS’ s lien and constructively pass
ownership to the respondents to the detriment of ALS.
Lien
[16]
The contract between ALS and SDG, inter alia, afforded ALS a special
and general lien and pledge over all goods either for
monies due in
respect of such goods or for other monies due to ALS. The terms of
the lien were already set out earlier in this
judgment. ALS alleged
that SDG owed it a total of R28 160 413-51 when SDG entered business
rescue in October, and that in relation
to goods imported by SDG for
the respondents, SDG was indebted to ALS for such freight forwarding
charges in a total of R19 717
827-03 comprising of R8 507 111-97 in
relation to goods which had already been released to R11 210 715-06
including storage charges
calculated to the end of October in
relation to goods still in ALS possession and under its control.
These amounts, comprising
R19 717 827-03 of the R28 160 413-51
referred specifically to goods imported for sale by SDG to the
respondents, and excluded other
customers of SDG for whom the same or
similar product was obtained.
[17]
The lien, jus retentionis, was explained as follows in The
Law of Agency in South Africa, Silke, 3rd edition, p
263:
“It consists in a
right to retain property whether immovable or movable, and including
money, which is in one’s possession,
until once’s claim
is satisfied. If the right is to retain only against satisfaction of
claims for expenses or liabilities
incurred in respect of the
particular property held, it corresponds to what is called in English
law a ‘particular lien’.
If it is a right to retain
property against payment of claims not connected with that property,
it corresponds to the English ‘general
lien’. Further,
the right may exist as against the world (in rem), or as against a
particular individual and his contractual
successors (in personam).”
At p 265 it was said:
“It is quite clear
that a ‘general right of retention’, when it exists,
covers payment of the general balance of account;
but only the
balance due in the particular employment (ie a factor cannot retain
against debts due to him in some other capacity).
And surely it must
cover too release from, or indemnity against, obligations and
liabilities incurred in that employment – …
Though there appears to
be no crisp statement to the effect that an agent as such has no
general lien, it is the irresistible inference
to be drawn from the
fact that while some agents, notably the factor, do enjoy such a
lien, others, eg a forwarding agent, have
only a special lien. Voet
is, however, not unambiguous, for he does not state in express terms
that the goods entrusted to the
agent can only be retained by him in
respect of money owing on those particular goods.”
The
lien agreed to between ALS and SDG provides expressly for a general
and special lien, which entitled ALS to retain property
against
payment of a general balance of account and not limited to amounts
owing in respect of the property held only. The express
agreement and
ALS’ physical possession of the goods effectively constituted
and established the lien [Vasco Dry Cleaners v Twycross 1979
(1) SA 603 (AD) at 611H]. ALS’ case was that the lien afforded
it the protection of a right of retention for the full amount of R19
717 827-03 effective against all parties with the sole exception of a
true owner of the goods who was not bound by the terms of
the
agreement creating a debtor/creditor lien and pledge. According to
ALS, the value of the commodity required in South Africa
and having
to be imported from China must naturally include the costs of
bringing the commodity to South Africa and the costs of
clearing the
goods, including charges and duties, which are generally described in
that business environment as ‘arrived
sound market value’.
All the useful and necessary expenses in relation to the imported
goods directly increased the ‘landed
value’ beyond the
original purchase price in China. They provided protection in the
form of the lien and right of retention.
ALS cleared the cargo, took
physical delivery and possession thereof from the shipping line and
retained physical possession thereof
on the basis that SDG was the
owner of the cargo. The papers suggest that the respondents were to
be the ultimate recipient of
the goods, and qualified to be the
consignee, and ultimately financially responsible for the receipt of
the shipment. The lien
was applicable to the respondents [LAWSA
2nd ed (3rd re-issue), para 293].
[18]
The submission by ALS that the court of first instance, under the
circumstances, was in no position to make factual findings,
on the
amount of security in favour of the respondents, was well founded. If
the facts set out by ALS were proven, the effect of
the order of the
court of first instance would be that ALS was deprived of its right
of retention conferred by the general and
special lien without
security for the R8 507 111-97 owed by SDG in respect of the goods
already released. The amount reflected
in the order of the court of
first instance meant that the security was limited to the protection
provided by the enrichment lien,
and did not refer to the contractual
lien. The reduction is unexplained in the judgment, more so because
according to ALS, the
reduction was a very significant deviation from
what had been tendered in the notice of application, which tender was
in the following
terms:
“5. That in the
event that respondent may contend that it has a lien over the
material or any part thereof the applicants pay into
the trust
account of respondent’s attorneys the amount claimed to be due
and payable in respect whereof respondent contends
it holds such
lien, to be held as security in place of such lien before paragraphs
2 to 4 become effective, subject to the following:
5.1 the respondent shall
institute action in respect of its lien within 21 calendar days of
the grant of this order; and
5.2 Failing which the
amounts paid as security shall be immediately repaid to the
applicant’s attorneys.”
Paragraphs
2 to 4 referred to in the tender related to prayers for making the
goods available for collection, delivery thereof to
the respondents
failing which the sheriff was authorized to attach, remove and
deliver the goods to the respondents.
[19]
The tender itself, made in the application, did not make any
reference to the amount of security. The amount claimed to be
due and
payable in respect of the lien, was R19 717 827-03. The parties had a
dispute as to the amount of ALS’s claim enforceable
against the
respondents based on the lien. In such circumstances, justice
demanded that the court exercises its discretion in favour
of the
provision of suitable and adequate security for the payment of the
lien claimant’s legitimate expenses [Avfin Industrial
Finance (Pty) Ltd v Interject Maintenance (Pty) Ltd 1997 (1) SA
807 (TPD) at p 815A-C; Hochmetals Africa Ltd v Otavi Mining Co Ltd
1968 (1) SA 571 (AD) at 581A, 582E-F]. The order of the court of
first instance was not sufficient to discharge ALS’s lien. An
action had
to follow in order to determine the respondents’
ownership and ALS’s legitimate expenses. In the face of a
dispute
a court will not make an order which in another way
diminishes the right to retention, to be exact, by ordering the
giving of security
for less than the amount of the detentor’s
claim [Mancicsco & Sons CC (In liquidation) v Stone 2001
(1) SA 168 (WLD) at 175B-C.
[20]
A lien should be met by a tender which is substantially adequate, not
what a court deemed fair [Mancisco p 175G and 175C]. A court’s
discretion must be informed by fairness and practicality, bearing in
mind that a lien, in circumstances
like the present, would have been
an effective and cost-effective remedy which if the court did not
provide adequate security for,
the court order will be depriving the
detentor thereof. Where the transferee established ownership, the
approach was set out as
follows:
“A lienholder
cannot simply insist on a guarantee for the full amount of its claim.
In deciding the adequacy of a guarantee, the
Court has to decide
whether the lienholder’s claim is prima facie excessive without
resolving factual disputes unless there
are incontrovertible
allegations. The court has to weigh up he strength of the arguments
advanced by the owner to challenge the
claim and arrive at what seems
to be a realistic best-case scenario for the lienholder.”
[Mancisco p 189B-C].
The order for the owner
to get possession of the goods once adequate security was given
carried with it the basic truth that the
interests of neither party
will be harmed [Mancisco p 182D].
As
already indicated, it is not established on the papers in this matter
that the respondents were the owners of the goods which
were in
possession of ALS. There was no agreement between the respondents and
ALS established on the papers, and that lack of privity
which existed
meant that they had no contractual obligations to one another,
thereby eliminating liabilities and access to contractual
rights. The
general and special lien of ALS was established. ALS had incurred
expenditure on the goods in pursuance of a contractual
obligation
existing between itself and SDG, and ALS had a right of retention
against SDG and a person in the position of the respondents
until it
was compensated for its expenditure on that property [Land Bank v
Mans 1933 CPD 16 at p 22; Naidoo v Sanbonani Express Freight
and Another 2008 (5) SA 530 (D & CLD) para 11]. On the other
hand, the ownership of the goods was still to be established by the
respondents.
[21]
The respondents approached the court in urgent motion proceedings.
The approach to the dispute in relation to the amount of
security to
be provided should have been guided by what was said in Wightman
t/a JW Construction v Headfour (Pty) Ltd and Another [2008] ZASCA 6; 2008 (3) SA
371 (SCA) at para 12 where it was said:
“[12] Recognising
that the truth almost always lied beyond mere linguistic
determination the courts have said that an applicant who
seeks final
relief on motion must, in the event of the conflict, accept the
version set up by his opponent unless the latter’s
allegations
are, in the opinion of the court, not such as to raise a real,
genuine or bona fide dispute of fact or are so far-fetched
or clearly
untenable that the court is justified in rejecting them merely on the
papers: Plascon-Evans Paints Ltd v Van
Riebeeck Paints (Pty) Ltd [1984] ZASCA 51; 1984 (3) SA 623 (A)
at 634E-635C. See also the analysis by Davis J in Ripoll-Dausa
v Middleton NO and Others [2005] ZAWCHC 6; 2005 (3) SA 141 (C)
at 151A-153C with which I respectfully agree.”
There
was no legitimate basis to exercise a discretion and decide the
amount of security upon the assumption that the respondents’
account of the events was substantially true and correct. Wightman
also emphasised that the security put up to recover possession must
be satisfactory [para 31]. It was the respondents who approached
the
courts for interim relief, and it is only natural that it be the
respondents who take the matter to its finality. The respondents
cannot seek interim relief, and once they have the court’s
indulgence in hand, then expect the other party to be the one
to seek
final relief, on the same dispute where they sought an interim
indulgence from the courts. I am unable to agree with the
court of
first instance on who had to institute an action. The respondents
cannot elevate the position provided by the interim
relief granted to
them as final.
[22]
The parties agreed that the goods were already released pursuant the
order of the court of first instance. The released goods
meant that
certain provisions of the order were no longer material. A successful
appeal means that the respondents will be obliged
to provide
additional security. For these reasons I am persuaded that the appeal
should succeed.
DM
THULARE
JUDGE
OF THE HIGH COURT
I
agree
M
PANGARKER
JUDGE
OF THE HIGH COURT
I
agree
G
ELLIOTT
ACTING
JUDGE OF THE HIGH COURT
Appearances
For
applicant:
Adv. SR Mullins SC
Instructed
by: Ms H
Teubes
For
respondent: Adv. L Olivier
Instructed
by:
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