Burmeister & Partners (Pty) Ltd v Elisenheim Property Development Company (Pty) Ltd (HC-MD-CIV-ACT-CON-2022/04623) [2025] NAHCMD 2 (15 January 2025)

Burmeister & Partners (Pty) Ltd v Elisenheim Property Development Company (Pty) Ltd (HC-MD-CIV-ACT-CON-2022/04623) [2025] NAHCMD 2 (15 January 2025)

REPUBLIC OF NAMIBIA



HIGH COURT OF NAMIBIA, MAIN DIVISION, WINDHOEK


RULING ON THE SPECIAL PLEA


Case No: HC-MD-CIV-ACT-CON-2022/04623


In the matter between:


BURMEISTER & PARTNERS (PTY) LTD PLAINTIFF


and


ELISENHEIM PROPERTY DEVELOPMENT COMPANY (PTY) LTD DEFENDANT


Neutral Citation: Burmeister & Partners (Pty) Ltd v Elisenheim Property Development Company (Pty) Ltd (HC-MD-CIV-ACT-CON-2022/04623) [2024] NAHCMD 2 (15 January 2025)


CORAM: SIBEYA J

Heard: 18 October 2024

Delivered: 15 January 2025


Flynote: Civil practice – Special plea of prescription – Raised by defendant against plaintiff’s claim for payment of an invoice in respect of professional services rendered – The invoice dated 2 March 2018 is for the period of 2014 to 2017, while combined summons were served on 27 October 2022 – Plaintiff claimed interruption of the prescription period – Prescription found to have been interrupted – Special plea dismissed.


Summary: The plaintiff instituted action proceedings for payment of Invoice 16 dated 2 March 2018, constituting a debt for professional services rendered to the defendant in terms of a written agreement. The invoice became due 30 days after it was issued, ie on 2 April 2018. The combined summons were served on the defendant on 27 October 2022, more than three years after the debt became due. The defendant raised a special plea of prescription contending that the debt claimed in Invoice 16 prescribed in terms of s 11 of the Prescription Act 68 of 1969 (‘the Act’).


In a replication to the special plea, the plaintiff averred that the prescription on Invoice 16 was interrupted in terms of s 14 of the Act, by the meetings of the parties on two occasions, namely, on 11 July 2019 and 15 August 2019, respectively, where the outstanding payment for Invoice 16 was discussed; and where the defendant never raised prescription but discussed the manner in which it would settle the invoice. This, together with the letter of 15 August 2019 (Exhibit ‘D’), providing the recordal of the meeting on the even date, according to the plaintiff, interrupted the running of the prescription period. The defendant disagreed.


Held: an acknowledgment of liability in terms of the Act interrupts the running of the prescription period when there is an admission that the debt (covering its elements) exists and that the debtor is liable therefor, and further that it must be apparent as to when prescription commenced to run de novo.


Held that: where probabilities do not resolve the matter, a court can resort to the credibility of witnesses in order to find for one or the other party. The evidence of Mr Edwin Thornley and Ms Lindie Verwey found to be marred with contradictions and not credible as compared to that of Mr Ronald Kubas and Ms Shamerian Kotze.


Held further that: although quiescence is not necessarily acquiescence, where there is duty on a person to speak or where, according to ordinary commercial practice and human expectation, someone is reasonably and fairly expected to speak and provide a reply, his or her silence may be regarded as raising an inference that he or she intended to accept the assertions made against him or her. The defendant contended that Exhibit ‘D’ contained incorrect averments and was self-serving, and under ordinary commercial practice or at the very least human expectation, the defendant had a duty to speak and repudiate the assertions in Exhibit ‘D’, failing which, it can be inferred that such assertions are probably correct.


Held: the plaintiff managed to prove on a balance of probabilities that it is highly probable that the defendant acknowledged liability for Invoice 16 and agreed to pay it in a period of four to five months from 15 August 2019 and thus, interrupting the prescription period which would then commence to run de novo from 15 December 2019 or 15 January 2020.


Special plea of prescription fund to lack merits and dismissed with costs.



ORDER

______________________________________________________________________


  1. The defendant’s plea of prescription is dismissed with costs, such costs to include costs of one instructing and one instructed legal practitioner.

  2. The matter is postponed to 6 February 2025 at 08h30 for a status hearing.

  3. The parties must file a joint status report on or before 3 February 2025.


______________________________________________________________________


JUDGMENT

______________________________________________________________________


SIBEYA J:


Introduction


[1] The plaintiff instituted action proceedings against the defendant on 13 October 2022, for:


1. Payment of the amount of N$617 837,08 in respect of professional services rendered.


2. Interest on the outstanding balance of N$617 837,08 at the rate of 0,067% per day calculated at tempore morae until date of final payment.


3. Cost of suit.


4. Further and or alternative relief.’


[2] The defendant raised a special plea of prescription and pleaded over on the merits. The special plea is opposed by the plaintiff.


Parties and their representation


[3] The plaintiff is Burmeister & Partners (Pty) Ltd, a company with limited liability, incorporated in accordance with the laws of the Republic of Namibia and registered as an engineering practice, with its principal place of business situated at No. 126 Andimba Toivo ya Toivo Street, Suiderhof, Windhoek.


[4] The defendant is Elisenheim Property Development Company (Pty) Ltd, a company with limited liability, incorporated in terms of the laws of the Republic of Namibia with its principal place of business situated at No 1 Trustco House, No 2 Keller Street, Windhoek.


[5] Where it becomes necessary to refer to the plaintiff and the defendant jointly, they shall be referred to as ‘the parties’.


[6] Mr Strydom appears for the plaintiff while Mr Lochner appears for the defendant.


The special plea


[7] The basis of the defendant’s special plea of prescription, is that, since the plaintiff relies on a written agreement for its cause of action, in terms of the said agreement, payments would be made within 30 days after the invoice date, and Invoice 16 dated 2 March 2018, became due 30 days after it was issued, thus, the debt became due on 2 April 2018. The summons were served on the defendant on 27 October 2022, more than three years after the debt became due. It is on this premise, that the defendant contends that the debt claimed in Invoice 16 prescribed in terms of s 11 of the Prescription Act 68 of 1969 (‘the Act’).


[8] The plaintiff filed a replication to the special plea and averred that the prescription on Invoice 16 was interrupted as contemplated in s 14 of the Act, as follows:


  1. by meetings of the parties on two occasions, namely, on 11 July 2019 and 15 August 2019, respectively, in order to discuss the outstanding payment under Invoice 16;


  1. at the meeting of 15 August 2019, the defendant was duly represented by Mr Edwin Thornley and Ms Lindie Joone;



  1. during both meetings, the defendant never raised prescription but instead actively engaged in discussions with the representatives of the plaintiff to map the way forward regarding the manner in which Invoice 16 would be serviced by the defendant;



  1. pursuant to the discussions, the parties agreed on the manner that the defendant would settle the outstanding amount, which included Invoice 16, whereby, they agreed on a reduction on the interest already charged on the outstanding amount together with the fact that payment of the outstanding amount would only be due and owing four to five months from the date of the meeting, 15 August 2019;



  1. the following constituted the salient terms of the agreement between the parties:



  1. that the defendant admitted liability for Invoice 16 in the amount of N$408 937,09 and further agreed to settle same;


  1. that the plaintiff agreed to a reduction of interest already charged on the said amount;



  1. that the defendant requested an extension of four to five months from 15 August 2019, for the repayment of the amount due to cash flow constraints experienced at the time, and this translated to the amount being due, owing and payable on 15 December 2019 or 15 January 2020;



  1. during the period that the plaintiff’s Debtor’s Clerk followed up on the payment of the outstanding invoice (Invoice 16), the defendant never disputed the invoice but instead referred the matter to treasury for payment. The defendant is said to not have disputed annexure D to the particulars of claim, the plaintiff’s recordal of the meeting of 15 August 2019.


[9] The plaintiff concluded that, on the basis of the above averments, the defendant acknowledged its indebtedness in respect of Invoice 16 in the amount of N$408 937,09, and therefore, interrupted the running of prescription.


[10] It thus, became apparent that the summons were served after a period of three years had lapsed from the date of Invoice 16, 2 March 2018, which was payable within a period of 30 days, on 2 April 2018. The plaintiff, therefore, retained the onus to prove the interruption of the prescription period. The parties led evidence of several witnesses, which I proceed to consider below.


Plaintiff’s evidence


[11] The first witness for the plaintiff was Mr Ronald Kubas, who testified, inter alia, that he is an engineer and the Managing Director of the plaintiff. He testified that the defendant employed the plaintiff to provide professional services to Elisenheim Wastewater Treatment Plant regarding the evaluation of the operator performance of the said facility. To that end, the parties concluded a written Client/Consultant Agreement (‘the agreement’). He testified further that during the period 2014 to 2019, the plaintiff rendered services in terms of the agreement.


[12] Mr Kubas testified that Invoice 16, including the capital and interest, is outstanding, and it is this invoice that the defendant alleges has prescribed. He stated that there were two meetings convened between the parties at the defendant’s boardroom, namely, on 11 July 2019 and 15 August 2019. He attended both meetings and was accompanied by Ms Shamerian Kotze, the Debtor’s Clerk of the plaintiff. The said meetings were also attended by Mr Edwin Thornely and Ms Lindie Joone, for the defendant. He testified that at the meeting of 15 August 2019, Invoice 16 was discussed in detail with a view to find ways to service it and the parties agreed on the manner in which the plaintiff was willing to accept future settlement thereof.


[13] Mr Kubas testified further that after the meeting of 15 August 2019, he wrote a letter to the defendant recording the terms agreed upon between the parties. This letter was received into evidence as Exhibit ‘D’. He said that the material terms agreed upon were that:


(a) the discussions centred around Invoice 16 in the amount of N$408 937,09 and the defendant admitted liability and agreed to settle the said amount;


(b) the defendant requested for an extension of time to pay the amount due, as a result of cash flow constraints experienced at the time, which extension was granted for about four to five months from 15 August 2019.


[14] Mr Kubas testified further that the defendant did not respond or contest the terms set out in Exhibit ‘D’. He stated that by acknowledging its indebtedness at the meeting in respect of Invoice 16, the defendant invoked s 14(1) of the Act, which interrupted the running of prescription, and extended the commencement of the running of prescription to 15 December 2019 or 15 January 2020. He contended that Invoice 16 would, therefore, only prescribe on 15 December 2022 or 15 January 2023 and thus, by 27 October 2022, when summons were served on the plaintiff, Invoice 16 had not yet prescribed.


[15] In cross-examination, Mr Lochner put to Mr Kubas that the meetings of 11 July and 15 August 2019, discussed all outstanding invoices and not just Invoice 16. Mr Kubas testified that by 11 July 2019, only Invoice 16 was due, while by 15 August 2019, invoices 16 and 19 were due. Invoice 20, on the other hand, was already issued by 15 August 2019, but not yet due. Mr Kubas testified further that the purpose of the meeting of 15 August 2019, was at the request of the defendant, to discuss the outstanding invoices. Mr Lochner questioned Mr Kubas, putting to him that all invoices were paid except for Invoice 16 as the defendant’s witnesses took issue with it on the basis that it prescribed and it was for work carried out in 2014. Mr Kubas disagreed and stated that the defendant never informed the plaintiff that Invoice 16 had prescribed, but rather stated that they wanted to settle the invoice but for cash flow problems.


[16] Mr Lochner further put to Mr Kubas that Mr Thornley never made a commitment to settle Invoice 16 as he was not authorised to do so. Mr Kubas testified that Mr Thornley was the project manager and the head of property, as such, the invoices were presented to him. On further cross-examination, Mr Kubas agreed with Mr Lochner that the meeting of 15 August 2019, did not only concern Invoice 16 but Invoice 19 as well. When suggested by Mr Lochner that Exhibit ‘D’ was incorrect as it only referred to Invoice 16 being discussed while Invoice 19 was also discussed, Mr Kubas testified that it is not entirely correct as both invoice 16 and 19 were discussed and that the reference to Invoice 16 only was because it had a larger amount and it was overdue for a considerable period of time.


[17] The plaintiff then led the evidence of its second and final witness, Ms Shamerian Kotze, who testified, inter alia, that she is a Debtor’s Clerk for the plaintiff. She testified that the plaintiff issued invoices to the defendant for professional services rendered. The defendant paid the invoices issued to it except for Invoice 16 for the amount of N$408 937,09.


[18] Considering that payment was not made, the defendant requested meetings with the plaintiff, which were convened on 11 July and 15 August 2019, respectively, at the defendant’s boardroom. At the said meetings, the outstanding Invoice 16 was discussed. Ms Kotze testified that she attended both meetings in the company of Mr Kubas. On 11 July 2019, the defendant was represented by Mr Edwin Thornley, Mr Schalk Kruger and Ms Helen Steyn, while on 15 August 2019, the defendant was represented by Mr Thornley and Ms Lindie Joone.


[19] Ms Kotze testified that at the meeting of 15 August 2019, the outstanding amount of N$408 937,09 plus interest of Invoice 16 was discussed and parties agreed on the manner in which the said invoice was to be settled. After the meeting, the plaintiff sent a letter (Exhibit ‘D’) to the defendant where the terms agreed upon in the meeting were recorded. She stated that she sent Exhibit ‘D’ to Mr Thornley and Ms Joone via email on 15 August 2019, at 03h27 PM. The said email was received into evidence marked Exhibit ‘D1’. It is recorded as follows:


Dear Edwin and Lindie.


Attached please find the letter with the arrangements agreed upon at today’s meeting.


Kind regards


Shamerian Kotze’


[20] Ms Kotze testified that the only issue that the defendant took with Invoice 16 was to seek an extension of time to pay the amount due as a result of cash flow constraints experienced at the time. The plaintiff, as a result, afforded the defendant a reduction in the interest charged and extension of time of four to five months to settle the invoice.


[21] Ms Kotze testified further that after the meeting of 15 August 2019, she followed up on the payment with Ms Joone telephonically and via emails. During such enquiries, Invoice 16 was never contested by the defendant. She testified that the defendant put up several reasons why Invoice16 was not paid, including that the invoice was at finance for processing and also that it was at treasury.


[22] In cross-examination Mr Lochner put to Ms Kotze that the meeting of 15 August 2019, discussed other invoices and not just Invoice 16 and she confirmed. She also confirmed that all invoices presented were paid except for Invoice 16. Mr Lochner put to Ms Kotze that Mr Thornley and Ms Joone informed her at the meeting that even though they were looking for ways to settle the outstanding invoices they had an issue with the prescription of Invoice 16, and that they could not make any commitment regarding the said invoice as they had no authority to do so. Ms Kotze denied these assertions. She testified that the meeting of 15 August 2019, was convened on the request of Mr Thornley and there was no mention of prescription except for the discount and the extension of time to pay due to cash flow constraints.


[23] She, however agreed that they raised an issue with Invoice 16 that it was for work done a long time ago. Ms Kotze further testified that at the meeting of 15 August 2019, the reduction of the interest regarding Invoice 16 was not discussed but what was discussed was the extension of payment and the payment plan.


Defendant’s evidence


[24] The defendant’s first witness was Mr Edwin Thornley. He testified, inter alia, that from October 2018 to October 2022, he was employed by the defendant as the Head of Property Development. He stated that he was present at both meetings held on 11 July and 15 August 2019, respectively, while Ms Lindie Joone only attended the meeting of 15 August 2019.


[25] Mr Thornley testified that at the said meetings he had specific instructions from the defendant’s executive director. He testified that Invoices 16, 19 and 20 were outstanding at the time of the second meeting of 15 August 2019. Invoices 19 and 20 were paid after the said meetings. He testified further that the meetings discussed how and when the payment of outstanding invoices would be made, if they were due and payable.


[26] Mr Thornley testified that Invoice 16 was only issued on 2 March 2018 for work carried out during 2014 to 2017. He stated that the defendant adopted the position that by 2019, Invoice 16 had prescribed and was, therefore, not due and payable. He testified further that in both meetings, he informed the plaintiff’s representatives that the defendant’s director held the view that Invoice 16 had prescribed as it concerned work carried in 2014. As a result, the executive director would consider whether to pay Invoice 16 out of goodwill.


[27] Mr Thornley also stated that he had no authority to discuss or decide on behalf of the director regarding Invoice 16. He denied acknowledging in the said meetings that Invoice 16 was due and payable or that the defendant admitted to an obligation to pay it. He testified further that at the meeting of 15 August 2019, he stated, without making commitments, that he would discuss the position of the plaintiff regarding Invoice 16 with the executive director.


[28] In cross-examination, Mr Thornley confirmed that Invoice 16 was issued on 2 March 2018 and a subsequent three year period would lapse in 2021. He also confirmed that the agreement provided that invoices would be paid within 30 days of the invoice date. It was put to him by Mr Strydom that Invoice 16 was the first invoice for the work of 2014 to 2017, and he agreed. Mr Strydom further put to Mr Thornley that a debt arises once an invoice had been presented to the debtor, and he answered in affirmative. He was also asked if work can prescribe, to which he responded that it cannot. He said that the directors of the defendant held the view that Invoice 16 prescribed. He, however, confirmed that he did not communicate the said stance of the defendant to the plaintiff.


[29] Mr Strydom sketched out an exposition of Invoice 16 to Mr Thornley as follows, namely, work carried out in October 2014 for an amount of N$8 103,03; work carried out in November 2014 to October 2015 for an amount of N$108 056,79; work carried out in November 2015 to October 2016 for an amount of N$127 670,25; and work carried out in November 2016 to August 2017 for an amount of N$111 767,40, with a total amount of N$355 597,47. The said amount plus value added tax (VAT) of N$53 339,62 totals N$408 937,09. Mr Strydom questioned Mr Thornley on how the said amounts could have prescribed regarding Invoice16. Mr Thornley explained that the portion of the invoice for work carried out from November 2015 to October 2016 and November 2016 to August 2017 had not prescribed. He testified that what prescribed is a portion of the invoice for the period of November 2014 to October 2015 bearing in mind that the invoice date is 2 March 2018. He ultimately conceded that when one has regard to the contents of Invoice 16, about 90 percent of the amount claimed had not prescribed.


[30] Mr Thornley testified that the principal issue discussed at the meeting of 11 July 2019 was the discount in respect of Invoice 16. He also confirmed receiving an email from Ms Kotze dated 5 August 2019, where a discount of N$90 735,99 was given. He stated that he is not aware if the said email was responded to by the defendant.


[31] In respect of the letter by Mr Kubas dated 15 August 2019 (Exhibit ‘D’), revealing a recordal of the meeting of 15 August 2019, Mr Thornley testified that he received the letter and forwarded it to his supervisor for further handling. He has no knowledge if the said letter was responded to. After a few exchanges with Mr Strydom in cross-examination, Mr Thornley testified that items 1 and 2 of Exhibit ‘D’ included Invoice 16. The said items provide that Trustco agreed in principle that the account is payable and agreed to settle same, and requested for about four to five months to sort out their internal cash flow. In re-examination, he testified that paragraphs 1 to 5 of Exhibit ‘D’ referred to the invoices which the directors deemed due and payable.


[32] The defendant’s second witness was Ms Lindie Verwey. She testified, inter alia, that she was previously Lindie Joone. She testified that she is employed by the defendant as the Operations Manager. Mr Thornley was her direct supervisor. She is so employed since October 2012. She testified that meetings were held between the parties on 11 July and 15 August 2019 respectively, of which she only attended the meeting of 15 August 2019. It was her evidence that by 15 August 2019, Invoice 16 which was issued on 2 March 2018, had prescribed. She recalled that Mr Thornley, during the 15 August 2019 meeting convened on a without prejudice basis, informed the plaintiff of the said position of the defendant regarding Invoice 16.


[33] Ms Verwey testified further that during the meeting of 15 August 2019, together with Mr Thornley, they did not acknowledge liability for Invoice 16, but stated that they will take up Invoice 16 with their directors. In respect of Exhibit ‘D’, Ms Verwey testified that the letter only contains the version of the plaintiff and is incorrect as no commitments were made to settle Invoice 16 and the letter further neglects to record that the defendant informed the plaintiff that Invoice 16 had prescribed. Although she saw the said letter, she did not respond to it as she was not instructed to do so.


[34] In cross-examination, Ms Verwey acknowledged that a debt arises when one receives an invoice. She stated that the agreement provided that invoices must be paid within 30 days of the invoice date, and this required that invoices must be issued within 30 days of work done. She testified that part of Invoice 16 prescribed. She testified further that she is not aware of any correspondence written that disputed the contents of Exhibit ‘D’. She, personally, she did not respond to the letter because she testified that she was instructed by Mr Thornley not to answer to the said letter as she was not a director.


Arguments


[35] Mr Strydom argued that the prescription that may apply to Invoice 16 was interrupted and extended based on the acknowledgment of liability by the defendant. He laid great store on Exhibit ‘D’, which was received into evidence as the recordal of the meeting of even date. He submitted that, the fact that the said letter was sent to the persons who attended concerned meeting on the same day, the failure by the representatives of the defendant to dispute or challenge the averments contained in the letter lends credence to such content.


[36] Mr Strydom further argued that when regard is had to the evidence of Mr Thornley, it becomes apparent that he conceded that despite his earlier position that Invoice 16 had prescribed, about 90 percent of the amount claimed had actually not prescribed. There is more from Mr Thornley’s evidence, he argued, particularly where he testified that paragraphs 1 to 5 of Exhibit ‘D’ are correct but did not solely relate to Invoice 16. This, Mr Strydom drove the point home, meant that paragraphs 1 to 5 concerned Invoice 16 together with other invoices. He concluded that, resultantly, the payment for Invoice 16 and the due date was postponed in accordance with the content of Exhibit ‘D’. He consequently called for the special plea to be dismissed with costs of two counsel.


[37] Mr Lochner was not to be surpassed. He argued that the defendant’s evidence reveals that it never intended to pay Invoice 16. This, he submitted, is supported by the evidence that the defendant maintained internally and outwardly at the meeting of 15 August 2019, that it believed that Invoice 16 had prescribed, hence it failed or refused to settle it.


[38] Mr Lochner argued further that the defendant’s failure to respond to Exhibit ‘D’ renders no assistance to the plaintiff. That is because the failure to respond to Exhibit ‘D’ with respect to interruption of prescription relates to tacit acknowledgement, which finds no application in this matter, so it was argued. He argued that Exhibit ‘D’ is not consistent with the proven facts of the matter, and that it is just an opportunistic attempt by the plaintiff to interrupt prescription. In any event, he submitted, none of the defendant’s witnesses who attended the 15 August 2019 meeting were authorised to admit liability for Invoice 16. Mr Lochner further argued that, on the plaintiff’s claim, it is impossible to state the date on which prescription commenced to run de novo with certainty. He invited the court to uphold the special plea with costs of two counsel.


The law


[39] The Act regulates prescription of debts, and its relevant provisions read as follows:


Extinction of debts by prescription


10. (1) Subject to the provisions of this Chapter and of Chapter IV, a debt shall be extinguished by prescription after the lapse of the period which in terms of the relevant law applies in respect of the prescription of such debt.


(2) By the prescription of a principal debt a subsidiary debt which arose from such principal debt shall also be extinguished by prescription.


(3) Notwithstanding the provisions of subsections (1) and (2), payment by the debtor of a debt after it has been extinguished by prescription in terms of either of the said subsections, shall be regarded as payment of a debt.


Periods of prescription of debts


11. The periods of prescription of debts shall be the following:


(a) thirty years in respect of –

(i) any debt secured by mortgage bond;

(ii) any judgment debt;

(iii) any debt in respect of any taxation imposed or levied by or under any law;

(iv) any debt owed to the State in respect of any share of the profits, royalties or any similar consideration payable in respect of the right to mine minerals or other substances;


(b) fifteen years in respect of any debt owed to the State and arising out of an advance or loan of money or a sale or lease of land by the State to the debtor, unless a longer period applies in respect of the debt in question in terms of paragraph (a);


(c) six years in respect of a debt arising from a bill of exchange or other negotiable instrument or from a notarial contract, unless a longer period applies in respect of the debt in question in terms of paragraph (a) or (b);


(d) save where an Act of Parliament provides otherwise, three years in respect of any other debt.


When prescription begins to run


12. (1) Subject to the provisions of subsections (2) and (3), prescription shall commence to run as soon as the debt is due.


Interruption of prescription by acknowledgement of liability


14. (1) The running of prescription shall be interrupted by an express or tacit acknowledgement of liability by the debtor.


(2) If the running of prescription is interrupted as contemplated in subsection (1), prescription shall commence to run afresh from the day on which the interruption takes place or, if at the time of the interruption or at any time thereafter the parties postpone the due date of the debt, from the date upon which the debt again becomes due.’ (My underlining)


[40] Nienaber JA who wrote for the Supreme Court of Appeal of South Africa in Road Accident Fund v Mothupi,1considered what constitutes an acknowledgement of liability in terms of the Act and stated the following:


(a) an acknowledgment of liability for purposes of s 14 of the Act is a matter of fact, not a matter of law;



(b) an acknowledgement of liability must amount to an admission of the existence of the debt and that the debtor is liable therefor;2



(c) the admission must cover at least every element of the debt and exclude any defence as to its existence;



(d) one must know of the date when the acknowledgement of liability was made failing which it would not be possible to say from what date should prescription commence to run de novo.



[41] The above principles set out our legal position on interruption of the running of the prescription period in terms of the Act. The acknowledgment of liability in terms of the Act, although not defined, requires an admission that the debt (covering its elements) exists and that the debtor is liable therefor, and further that it must be apparent as to when prescription commenced to run de novo.


Analysis


[42] It is common-cause between the parties that the only live claim by the plaintiff is in respect of Invoice 16 dated 2 March 2018. It is further common cause that the debt in Invoice16 became due on 2 April 2018. The summons were served on 27 October 2022, more than three years after 2 April 2018, resulting in the defendant raising a special plea of prescription. In replication, the plaintiff averred that the prescription in Invoice 16 was interrupted at the meetings of the parties held on 11 July and 15 August 2019, respectively. The plaintiff averred that the defendant acknowledged liability, which interrupted the running of the prescription period. The issue for determination is thus whether or not the running of prescription was interrupted as alleged by the plaintiff.


[43] It was long settled in our law that he who alleges must prove such allegation. Lord Denning in Miller v Minister of Pensions3 discussed the standard of proof in civil proceedings and remarked that:


‘It may carry a reasonable degree of probability but not so high as is required in a criminal case. If the evidence is such that the tribunal can say “we think it more probable than not” the burden is discharged, but if the probabilities are equal it is not.’


[44] The plaintiff, therefore, bears the burden to prove the interruption of the prescription period on a balance of probabilities. With the said onus in mind, I proceed to consider the evidence led.


[45] The plaintiff relies on both oral and documentary evidence in its quest to prove the interruption and extension of payment of Invoice 16.


[46] The evidence of Mr Mr Kubas, for the plaintiff, was to a large extent corroborated by that of Ms Kotze. He testified that Invoice 16 was particularly discussed in detail at the aforesaid meeting of 15 August 2019 in order for the defendant to find ways to settle it. His testimony, supported by the evidence of Ms Kotze, was that the defendant admitted liability for Invoice 16 to the amount of N$408 937,09 and agreed to settle it. The defendant never informed the plaintiff that Invoice 16 prescribed. The defendant requested for an extension of time to pay the invoice due to cash flow constrains. The extension of about four to five months from 15 August 2019 was granted. The terms agreed upon were recorded in Exhibit ‘D’ and sent by the plaintiff to the defendant on the even date of 15 August 2019, but no response was ever received thereto from the defendant. According to Mr Kubas, the running of prescription was extended to commence either from 15 December 2019 or 15 January 2020. This would mean that by the time that the summons were served on 27 October 2022, Invoice 16 had not prescribed.


[47] Ms Kotze testified that subsequent to the meeting of 15 August 2019, the parties agreed to the extension of payment of Invoice 16, she followed up on payment on several occasions. The defendant, without contesting Invoice 16, provided various explanations for non-payment, including that the invoice was at finance for processing and also that it was at treasury. Her evidence about the reasons for non-payment allegedly proffered by the defendant was not disputed.


[48] For the defendant, Mr Thornley and Ms Verwey (previously Ms Joone) denied acknowledging liability for Invoice 16 at any of the said meetings. They also testified that they had no authority to acknowledge liability for Invoice 16. Ms Verwey testified that her supervisor, Mr Thornley, informed the representatives of the plaintiff during the meeting of 15 August 2019 that Invoice 16 had prescribed.


[49] It became apparent that the evidence of the plaintiff and that of the defendant is mutually destructive. This compels the court to assess the evidence and attach weight to the most probable version.


[50] When faced with mutually destructive versions, our courts have adopted the approach set out by the Supreme Court of Appeal of South Africa in the celebrated decision of Stellenbosch Farmers' Winery Group Ltd v Martel et Cie & Others,4 where the court remarked as follows at paragraph 5:


‘[5] On the central issue, as to what the parties actually decided, there are two irreconcilable versions. So too on a number of peripheral areas of dispute which may have a bearing on the probabilities. The technique generally employed by courts in resolving factual disputes of this nature may conveniently be summarised as follows. To come to a conclusion on the disputed issues a court must make findings on (a) the credibility of the various factual witnesses; (b) their reliability; and (c) the probabilities. As to (a), the court's finding on the credibility of a particular witness will depend on its impression about the veracity of the witness. That in turn will depend on a variety of subsidiary factors, not necessarily in order of importance, such as (i) the witness's candour and demeanour in the witness-box, (ii) his bias, latent and blatant, (iii) internal contradictions in his evidence, (iv) external contradictions with what was pleaded or put on his behalf, or with established fact or with his own extra curial statements or actions, (v) the probability or improbability of particular aspects of his version, (vi) the calibre and cogency of his performance compared to that of other witnesses testifying about the same incident or events. As to (b), a witness's reliability will depend, apart from the factors mentioned under (a)(ii), (iv) and (v) above, on (i) the opportunities he had to experience or observe the event in question and (ii) the quality, integrity and independence of his recall thereof. As to (c), this necessitates an analysis and evaluation of the probability or improbability of each party's version on each of the disputed issues. In the light of its assessment of (a), (b) and (c), the court will then, as a final step, determine whether the party burdened with the onus of proof has succeeded in discharging it. The hard case, which will doubtless be the rare one, occurs when a court's credibility findings compel it in one direction and its evaluation of the general probabilities in another. The more convincing the former, the less convincing will be the latter. But when all factors are equipoised probabilities prevail’. (See U v Minister of Education, Sports and Culture and Another 2006 (1) NR 168 (HC); Sakusheka and Another v Minister of Home Affairs 2009 (2) NR 524 (HC)).


[51] Further in National Employers' General Insurance Co Ltd v Jagers5 it was held as follows:


'(The plaintiff) can only succeed if he satisfies the Court on a preponderance of probabilities that his version is true and accurate and therefore acceptable, and that the other version advanced by the defendant is therefore false or mistaken and falls to be rejected. In deciding whether that evidence is true or not the Court will weigh up and test the plaintiff's allegations against the general probabilities. The estimate of the credibility of a witness will therefore be inextricably bound up with a consideration of the probabilities of the case and, if the balance of probabilities favours the plaintiff, then the Court will accept his version as being probably true. If however, the probabilities are evenly balanced in the sense that they do not favour the plaintiff's case any more than they do the defendant's, the plaintiff can only succeed if the Court nevertheless believes him and is satisfied that his evidence is true and that the defendant's version is false.'

[52] It follows from the above that where the probabilities do not resolve the matter, the court can resort to the credibility of witnesses in order to find in favour of the one or the other party. In this regard, the court will consider the candour and demeanour of witnesses, self-contradiction or contradiction of established facts or contradiction with the evidence of other witnesses present and who are expected to provide the same version of events.


[53] It is an established fact that the plaintiff presented Invoice 16, together with other invoices, for payment. Mr Thornley testified that the directors of the defendant took the stance that Invoice 16 had prescribed. When questioned in cross-examination, he stated that he did not communicate such stance to the plaintiff. Ms Kotze, on the other hand, testified that during the meeting of 15 August 2019, Mr Thornley informed the plaintiff that Invoice 16 prescribed.


[54] Mr Thornley testified that the principal issue discussed at the meeting of 11 July 2019, was the discount related to Invoice 16. He also confirmed receiving an email from Ms Kotze confirming the discount on Invoice 16. Ms Verwey did not attend this meeting, therefore, Mr Thornley was the defendant’s sole witness on the events of 11 July 2019. Mr Thornley, however, further testified to the contrary, that the plaintiff’s claim had prescribed and that the directors would consider whether to pay it out of goodwill.


[55] Mr Thornley further testified that items 1 and 2 on Exhibit ‘D’ included Invoice16. These items state that Trustco agreed that the account is payable and it will settle same after requesting for an extension of four to five months to sort out its internal cash flow. This evidence points to self-contradiction as in the same testimony, Mr Thornley stated that the defendant did not acknowledge liability for Invoice 16, which was also the mantra of Ms Verwey. I find that both Mr Thornley and Ms Verwey did not testify in a forthright manner and their evidence was marred with contradictions.


[56] After agreeing that items 1 and 2 of Exhibit ‘D’ included Invoice 16, I find it improbable that Mr Thornley would turn around and contend that Exhibit ‘D’ was not due and payable. Similarly, I find the evidence of Ms Verwey to be improbable where she testified that, together with Mr Thornley, they did not acknowledge liability for Invoice 16. This, particularly, contradicts the content of Exhibit ‘D’, a recordal of the meeting by Mr Kubas which she received but never corrected or at the very least responded to where she could point out any anomalies in the letter. I find her explanation for failure to respond to Exhibit ‘D’ that she was instructed not to respond by Mr Thornley to be improbable. This is because it defeats logic why she would not respond to an alleged recordal of a meeting that contains false allegations which, according to her, are self-serving. Besides, Mr Thornley did not testify to instructing her not to respond to Exhibit ‘D’.


[57] Mr Kubas, on the flipside of the coin, was impressive in his testimony as he testfied in a forthright manner, while being calm and his evidence was corrobarated by Ms Kotze, documentary evidence and established facts. I find his evidence to be highly probable and reliable. As stated, the same cannot be said for Mr Thornley and Ms Verwey.


[58] It is common-cause that Exhibit ‘D’ was not responded to by the defendant. This is despite the fact that Exhibit ‘D’ was written by Mr Kubas as a recordal of the discussion and agreement reached by the parties on even date and addressed to Mr Thornley who represented the defendant together with Ms Verwey. Exhibit ‘D’ sets out the names and capacities of the persons who attended the meeting of 15 August 2019, and the terms agreed to. Items 1 and 2 of the alleged terms agreed upon regarding invoice 16 were recorded as follows:


‘1. Trustco agreed in principle that the account is payable and agreed to settle same.

2. Trustco requested for some time (4-5 months) to sort out their internal cash flow before they can settle the amount inclusive of interests.’


[59] Can it be said that there was a legal duty on the defendant and its representatives to speak against the content of Exhibit ‘D’ if it or they disagreed with the content thereof?


[60] Miller JA in the South African Supreme Court of Appeal matter of McWilliams v First Consolidated Holdings (Pty) Ltd6 remarked as follows:


‘I accept that quiescence is not necessarily acquiescence (see Collen v Rietfontein Engineering Works 1948 (1) SA 413 (A) at 422) and that a party’s failure to reply to a letter asserting the existence of an obligation owed by that party to the writer does not always justify an inference that the assertion was accepted as the truth. But in general, when according to the ordinary commercial practice and human expectation firm repudiation of such an assertion would be the norm if it was not to be accepted as correct, such party’s silence and inaction, unless satisfactorily explained, may be taken to constitute an admission by him of the truth of the assertion, or at least it will be an important factor telling against him in the assessment of the probabilities and in the final determination of the dispute. And an adverse inference will be more readily drawn when the unchallenged assertion had been preceded by correspondence and negotiations between the parties relative to the subject-matter of the assertion.’


[61] In our Supreme Court, Mtambanengwe AJA in Stier v Henke,7 had an opportunity to discuss the effect of silence where there is duty to speak and said the following at p. 374:



‘Discussing the question of silence as acceptance, Christie, in the Law of Contract in South Africa 5th ed referred, at 66, to the principle that ‘quiescence is not necessarily acquiescence’, but went on to state:


“Silence may, however, amount to acceptance of an offer in circumstances which give rise to a “duty to speak” if the offeree is not prepared to accept the offer. Wessels in paras 270-271 has been taken by the courts as authoritative:


But if there is a legal duty upon me to speak and I refrain from doing so, the court will presume that I assented…. Thus, if a merchant writes to his constant correspondent that he will forward to him certain goods at a certain price unless he hears from him to the contrary, and the addressee receives the letter but neglects to reply, the court may well consider that silence in such a case gives consent … The course of dealing between such merchants will legitimately lead the offeror to conclude that his correspondent would reply in case he rejected the offer, and the court will infer that if the offeree had not intended to accept he would have answered that he did not want the goods.

If, therefore, from the business relationship between the offeror and the offeree, the court finds that the circumstances are such that the offeree could reasonably and fairly be expected to reply, then it may infer that by remaining silent the offeree did in fact intend to accept.”’


[62] The above statement of the law lays bare our legal position that although quiescence is not necessarily acquiescence, where there is duty on a person to speak or where, according to ordinary commercial practice and human expectation, someone is reasonably and fairly expected to speak and provide a reply, his or her silence may lead to an inference that he or she intended to accept the assertions made. With that in mind, coupled with the defendant’s evidence that Exhibit ‘D’ contained incorrect averments and was self-serving, I find that in terms of ordinary commercial practice or at the very least human expectation, the defendant should have repudiated the assertions in Exhibit ‘D’. I find, therefore, that there was a duty on the defendant to speak against the averments set out in Exhibit ‘D’.


[63] On the basis of the above authorities, I find that it can be properly inferred in casu that the failure by the defendant to reply and contradict or deny the assertions contained in Exhibit ‘D’ makes it probable that the parties, on 15 August 2019, discussed Invoice 16 and agreed to the terms set out in items 1 and 2 referred to therein. I pause to observe that, in the present matter, the defendant’s failure to reply to Exhibit ‘D’ is not the only finding that tilts the scale in favour of the plaintiff.


[64] Damaseb DCJ in M Pupkewitz & Sons v (Pty) Ltd t/a Pupkewitz Megabuilt v Kurz,8 stated as follows on fact finding at 790:



‘In the words of Selke J in Govan v Skidmore 1952 (1) SA 732 (N) at 734A-D:

“Now it is trite law that, in general, in finding facts and making inferences in a civil case, the Court may go upon a mere preponderance of probability, even though its so doing does not exclude every reasonable doubt … for, in finding facts or making inferences in a civil case, it seems to me that one may … by balancing probabilities select a conclusion which seems to be the more natural, or plausible, conclusion which amongst several conceivable ones, even though that conclusion be not the only reasonable one.”’


[65] I, therefore, find that the plaintiff managed to prove on a balance of probabilities that the defendant acknowledged liability for payment of Invoice 16 based on the following:


(a) the evidence that the meeting of 11 July 2019 principally discussed the discount to Invoice 16, and which discount was ultimately provided;


(b) the evidence that the meeting of 15 August 2019, discussed Invoice 16 and the defendant admitted its liability and agreed to pay same within four to five months as it had to sort out its cash flow issues;


(c) the evidence that Ms Kotze made several follow-ups for payment of Invoice 16 and that she was met with various explanations from the defendant including that the invoice was at finance for processing and also at treasury, with no mention that such invoice had prescribed. This evidence, as stated, remains unchallenged;


(d) the evidence of Mr Thornley’s that items 1 and 2 of Exhibit ‘D’ included Invoice 16 while items 3 to 5 related to other invoices; and


(e) the evidence that Exhibit ‘D’ was not responded to by the defendant despite being presented as a recordal of the meeting of the even date and after being addressed to the representatives of the defendant who attended the meeting.


[66] I find that the plaintiff managed to establish that it is highly probable that the defendant acknowledged liability for Invoice 16 and agreed to pay it in a period of four to five months from 15 August 2019. This means that prescription would then commence to run de novo from 15 December 2019 or 15 January 2020.


Conclusion


[67] In light of the above findings and conclusions, coupled with the meetings of 11 July and 15 August 2019 respectively, and the recordal of 15 August 2019, the plaintiff established a high probability that the defendant acknowledged liability for Invoice 16.


[68] As found above, the plaintiff managed to prove on a balance of probabilities that the defendant acknowledged liability for Invoice 16 and sought an extension of time to settle the debt, thus interrupting the prescription period. As a result, I find that the special plea of prescription lacks merit and falls to be dismissed.


Costs


[69] It is an established principle of law that costs normally follow the result. The plaintiff succeeded to prove that the special plea raised by the defendant lacks merit and ought to be dismissed. It follows, therefore, that the plaintiff deserves to be awarded costs. I find no basis to hold otherwise. The plaintiff will thus be awarded costs consequent upon the employment of two legal practitioners. For avoidance of doubt, the costs awarded are not subject to rule 32(11).


Order


[70] In the result, the following order is issued:


  1. The defendant’s plea of prescription is dismissed with costs, such costs to include costs of one instructing and one instructed legal practitioner.

  2. The matter is postponed to 6 February 2025 at 08h30 for a status hearing.

  3. The parties must file a joint status report on or before 3 February 2025.



__________

O S SIBEYA

Judge




APPEARANCES:


PLAINTIFF: A STRYDOM

Instructed by Theunissen, Louw & Partners,

Windhoek



DEFENDANT: L LOCHNER

Instructed by Veiko Alexander & Co Inc,

Windhoek




1 Road Accident Fund v Mothupi 2000 (4) SA 38 (SCA) paras 36 to 39.

2 Shambo v Amukugo 2016 (1) NR 44 (HC) para 19.

3 Miller v Minister of Pensions [1947] 2 All ER 372 at 374.

4 Stellenbosch Farmers' Winery Group Ltd v Martel et Cie 2003 (1) SA 11 (SCA).

5 National Employers' General Insurance Co Ltd v Jagers 1984 (4) SA 437 (E) 440E – G; Also see Harold Schmidt t/a Prestige Home Innovations v Heita 2006 (2) NR 555 (HC) 556.

6 McWilliams v First Consolidated Holdings (Pty) Ltd [2011] 4 All SA 369 (SCA) 24.

7 Stier v Henke 2012 (1) NR 370 (SC) 374D-F.

8 M Pupkewitz & Sons v (Pty) Ltd t/a Pupkewitz Megabuilt v Kurz 2008 (2) NR 775 (SC) 790A-C.

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