The Commercial Case Law Index is a collection of judgments from African countries on topics relating to commercial legal practice. The collection aims to provide a snapshot of commercial legal practice in a country, rather than present solely traditionally "reportable" cases. The index currently covers 400 judgments from Uganda, Tanzania, Nigeria, Ghana and South Africa.
Get started on finding judgments that are relevant to you by browsing the topic list on the left of the screen. Click the arrows next to the topic names to reveal a detailed list of sub-topics. Most judgments are accompanied by a short summary written by subject-matter expert postgraduate students from the University of Cape Town.
The court considered an application for temporary injunction restraining the respondents from selling two seized motor vehicles. Furthermore, the court considered whether the right of seizure and sale can be exercised without the intervention of the court.
This case concerned an agreement for the sale and purchase of 10 motor vehicles. The applicant alleged that the agreement was oral, whereas the respondents alleged it was written. The applicant subsequently defaulted on the payment and the first respondent seized the vehicles and threatened to sell the vehicles on public auction.
The court found that the agreement concluded between the parties was in fact a written agreement.
The court considered the provisions of S 124 – S 128 of the Law of Contract Act. The basis of these provisions found that the pawnee may retain goods pledged for payment of any debt and may bring a suit against the pawnor upon the debt and retain the goods pledged as collateral security or he may sell the thing pledged.
The court found that the applicant (pawnor) defaulted in payment and the first respondent (pawnee) had the option of bringing a suit against the pawnor and retaining the goods as security or sell the thing pledged by giving the pawnor reasonable notice. If the proceeds are less than the amount due, the pawnor is liable to pay the balance. If the proceeds are more, the pawnee shall pay the surplus to the pawnor.
A pawnee, in possession of the title and the property pledged is entitled to sell the property without intervention of the court. However, in absence of possession, he cannot take the law into his own hands without the court’s intervention.
The court found that there was no clause in the agreement empowering the first respondent to take possession and sell the vehicles, and thus he cannot exercise his right without the court’s assistance.
The plaintiff contested the validity of the sale and transfer of its property by the first defendant, alleging the transaction was tainted by illegality and fraud. The mortgaged property was auctioned in a public sale pursuant to the terms of the credit facility agreement concluded between the parties.
The contract permitted that the first defendant could execute the property without application to a court if the plaintiff defaulted on payment. In accordance with this provision, the first defendant advertised and sold the plot in a public auction to the second defendant who made the purchase in good faith.
The plaintiffs challenged the first defendant’s actions on several grounds with no success before the High Court. It was argued that, because the sum advanced by the first defendant fell marginally short of the anticipated amount, it did not have to perform its obligation under the contract to pay the stipulated installments, despite having received and utilised the sum advanced by the first respondent.
The court dismissed this argument along with further technical attacks to the alleged unlawfulness of the advertisement of the auction, the sale agreement’s adherence to statutory formalities, and the first defendant’s failure to ‘release’ the plaintiff from the mortgage following the sale of the property to the second defendant.
The judge found in favour of the defendants, ruling that the advertisement, sale and transfer of the property had occurred lawfully and did not offend any aspects of the parties’ agreement.
The applicant brought an application for interim order against the respondents disposing of the
suit property fraudulently mortgaged by her husband without spousal consent the same being
matrimonial property. The applicant’s suit was dismissed by the trial court hence the appeal from
which the application arose.
The matter involved a dispute over the defendants’ refusal to release a certificate of title pursuant to an agreement to do so.
The first issue was whether the defendant was justified in not releasing the certificate of title belonging to the plaintiffs. The court observed that the defendant’s conduct in refusing to release the title created an impression of premeditated non-performance with the defendant only using the purported mala fides (bad faith) conduct as a farcical reason. The court thus concluded the defendants' conduct was unjustifiable.
The second issue was whether the conduct led to loss for the plaintiffs. Concerning whether there was loss of profits due to the plaintiffs being detracted from clearing their indebtedness the court found there was insufficient evidence to support it.Similarly, on the corresponding allegation that the conduct resulted in the incurring of interests due to another creditor, the court held that payment of interests had not been proved by the plaintiff. It thus denied the claim for both loss of profits and interest payments.
However, the court did accept that the actions of the defendant prevented them from discharging their indebtedness and thus resulted in the incurral of interest. It thus absolved the payment of the interests that arose within the affected period and consequently snuffed the corresponding counter-claimed interests for the period.
Regarding damages, the court reasoned that the plaintiffs had acted on the impression that the title would be released to enter into some arrangements which were frustrated by the defendants' unjustified conduct. It therefore granted general damages. Similarly, because of the defendants' oppressive and high-handed conduct, the court granted punitive damages.