Court name
Supreme Court
Case name
Mbambus v Motor Vehicle Accident Fund
Media neutral citation
[2015] NASC 1
Judge
Garwe AJA










IN
THE SUPREME COURT OF NAMIBIA


CASE
NO: SA 4/2013


DATE:
11 FEBRUARY 2015


REPORTABLE


In
the matter between:


ELIZABETH
MBAMBUS
..................................................................Appellant


And


MOTOR
VEHICLE ACCIDENT
FUND
.......................................Respondent


Coram:
DAMASEB AJA, ZIYAMBI AJA and GARWE AJA



Heard: 4 July
2014



Delivered: 11
February 2015


APPEAL
JUDGMENT


GARWE
AJA (ZIYAMBI AJA concurring):


[1]
I have read the judgment of my brother
Damaseb AJA (as he then was). The judgment aptly sets out the facts
of this case. In the judgment Damaseb AJA accepted as a general
proposition that it would not be permissible for the Motor Vehicle
Accident Fund (the Fund) to settle by compromise a claim arising from
the unlawful conduct of a deceased upon whom a claimant depended. He,
however, found that on a consideration of the facts of this case the
conclusion was inescapable that the Fund either was satisfied that
the deceased was not the author of his own death or that the Fund was
unable to prove that he was.  On the further grounds that the
Fund was
proferens
in regard to the settlement agreement and its content and that it had
also subsequently engaged in conduct against its own interest so as
to be presumed to have conceded that it settled the claim in order to
avoid litigation, Damaseb AJA came to the conclusion that a valid
compromise had taken place.  In the event, he set aside the
order of the court
a quo
and in its place substituted an order answering the question referred
by the parties in favour of the plaintiff (appellant in this appeal)
and ordering payment of the amount in dispute together with interest
and costs of suit.


[2]
Having carefully considered the judgment by
Damaseb AJA, I am, with respect, unable to agree with the various
conclusions of fact and law made therein.  For reasons that
follow, I am of the view that, taking into account the entirety of
the facts, there was no stated case before the court
a
quo
and consequently the matter should
not have been dealt with as such.


[3]
The respondent, the Fund, is a statutory
body created under the Motor Vehicle Accident Fund Act 4 of 2001,
which has since been repealed by Act 10 of 2007.  Its function
is to investigate and possibly settle claims for compensation by
persons who suffer loss or damage as a result of bodily injury to
themselves or others, or where death occurs, to the dependants of the
deceased. The rider to this power is that the Fund is not permitted
to pay compensation to any person or dependant of a deceased person,
arising from the unlawful conduct of the claimant or of the deceased
upon whom a claimant was dependent.


[4]
The Fund in terms of s 3(1)(b)
of the repealed Act, had the power to settle claims, but subject to
the Act. The court
a quo
in my view was correct when, in this regard, it remarked at para 10
of the judgment:


It
is significant that the defendant is granted the express power to
settle claims, in other words, to enter into compromises of claims
arising under s 10.  By referring to s 10, the power to settle
is limited to claims where the claimant is not the driver, or a
dependant of a driver, by whose negligence the injury or damage was
caused . . . ’


[5]
Para 1.2 of the stated case referred to the
court
a quo
reads as follows:-


The
defendant alleges the accident was caused by the negligent, unlawful
driving of the deceased . . .  in that the deceased . . . 
was driving the lane (
sic)
of oncoming traffic and collided head on with a truck driven by a
certain Mr L Jacobs.’





[6]
The court a
quo
approached the matter on the basis
that both parties accepted that the deceased had driven on the lane
of oncoming traffic causing the accident which claimed his life.
Whether or not the court
a quo
was correct in doing so is an issue that will be dealt with shortly.
It is clear however that based on that finding the court
a
quo
concluded that the settlement
relied upon by the appellant (plaintiff in the court
a
quo
) had not been properly concluded
and was therefore null and void.


[7]
Proceeding on the assumption that the
deceased had indeed unlawfully caused the accident which resulted in
his death, the court
a quo
was correct in its application of the law, a position accepted by
Damaseb AJA in his judgment.  The court
a
quo
stated at para 10 of the judgment:


.
. . In the
Metals Australia
case the Supreme Court made it clear that although the validity of an
agreement of compromise does not generally depend on the validity of
any contract it replaces, nevertheless, for it to be a binding
contract, the compromise agreement must have been properly concluded
(see [27]F-G). In the context of a public body like the defendant a
properly concluded contract would mean a contract which it had the
power to conclude.  The principle is well-established and clear
that a public body created for a particular purpose with statutory
powers cannot validly exercise powers not expressly or impliedly
authorised (
De Villiers v The Pretoria
Municipality,
1912 TPD 626) . . . ’





[8]
The position is, I think, well settled that
anything that is done contrary to the law is void.  In the oft -
quoted Zimbabwean case of
Muchakata v
Nertherburn Mine
1996 (1) ZLR 153 (SC)
Korsah JA, remarked at 157B-C:


If
the order was void
ab initio
it was void at all times and for all purposes.  It does not
matter when and by whom the issue of its validity is raised; nothing
can depend on it.  As Lord Denning MR so exquisitely put it in
MacFoy v United Africa Co
Ltd [1961] 3 All ER 1169 at 1172I:


If
an act is void, then it is in law a nullity. It is not only bad, but
incurably bad . . . And every proceeding which is founded on it is
also bad and incurably bad. You cannot put something on nothing and
expect it to stay there.  It will collapse”.’






Put
another way, if the Fund entered into the compromise well knowing
that the deceased had unlawfully caused the accident, then such
compromise would have been void and in a law a nullity. And if it was
a nullity, no rights or cause of action could flow from it.


[9]
Both parties to this appeal agreed that the
Fund could, in an appropriate case, compromise a claim. If, as
Damaseb AJA noted, the Fund was uncertain as to its prospects of
success at trial, it could quite competently settle a claim. 
Once that happened, that would be the end of the matter.  Its
effect would be the same as
res judicata
on a judgment given by consent and neither party would have any cause
of action thereafter on the same facts, unless the right to rely
thereon was reserved.  For this reason a party cannot raise
defences to the original cause of action except in cases where the
compromise was induced by fraud, duress,
justus
error,
misrepresentation, or some other ground
for rescission.
Georgias v Standard
Chartered Finance Zimbabwe
Ltd 2000 (1)
SA 126 (ZS), at 138I–140D, quoted with approval in
Metals
Australia
Ltd
and Another v Amakutuwa and Others
2011
(1) NR 262 (SC) para 21.


[10]
The issue that arises on the facts of this
case is whether there was in fact a stated case before the High
Court.


[11]
The Rules of Court of a number of countries
make provision for submission to a court of questions of law in the
form of a ‘stated case’ or a ‘special case.’ 
Attention is drawn as an example to Rule 49(10) of the Uniform Rules
of Court of South Africa, order 29 of the High Court of Zimbabwe
Rules, 1971 and in Namibia Rule 33 contained in Government Notice 59
of 1990 which has since been repealed and substituted by rule 63 of
the Rules of the High Court of Namibia, Government Notice 4 of 2014
dated 24 December 2013.


[12]
Rule 33, which was the rule in operation at
the relevant time, provided, in relevant part, as follows:


SPECIAL
CASES AND ADJUDICATION UPON POINTS OF LAW





33.(1)
The parties to any dispute may, after institution of proceedings,
agree upon a statement of facts in the form of a special case
for the adjudication of the court.





(2)(a)
Such statement shall set forth the facts agreed upon, the
questions of dispute between the parties and their contentions
thereon, and such statement be divided into consecutively numbered
paragraphs and there shall be attached thereto copies of documents
necessary to enable the court to decide upon questions, and it shall
be signed by counsel on behalf of party or, where a party sues or
defends personally, by such party.





(b)
. . .


(c)
. . .







(3) At the hearing
thereof the court and the parties may refer to the whole of the
contents such documents and the court may draw any inference of fact
or of law from the facts and documents as if proved at a trial.


(4)
. . .


(5)
. . .


(6)
If the question in dispute is one of law and the parties are agreed
upon the facts, the facts may be admitted and recorded at the trial,
and the court may give judgment without hearing any evidence.” 
(Italics for emphasis.)





[13]
My understanding of the above provisions is
that the parties must agree on the facts and the issues in dispute
between them, including any issues of law arising therefrom.  I
agree with the submissions by the respondent that the intention is
that the stated case will adjudicate the whole of the dispute as
stated in the case that exists between the parties and that this is
ideally done by setting out the facts agreed to, the questions of law
in dispute and the contentions of the parties.  The parties may
also require a court to decide an issue of law on the basis of
alleged facts, as if agreed.


[14]
A stated case:


.
. . is a written statement of the facts in a litigation, agreed to by
the parties, so that the court may decide these questions according
to law . . .  It is also known as a case stated.’ 
Strouds Judicial Dictionary,
4 Ed.


.
. . involves stating facts, that is, the ultimate facts, requiring
only the certainty of some point of law applied to those facts to
determine either the whole case or some particular stage of it.’ 
Australian Shipping Board v Federated
Seamens Union of Australasia
(1925), 36
CLR 442, 450.





[15]
In the Irish case of Simon
McGinley v The Deciding Officer Criminal Assets Bureau,

[2001] IESC 49, the Irish Supreme Court (per Denham J) had the
following to say on what is required in a stated case:


4.
Decisions relating to the form of cases stated to the High Court are
helpful in considering the form of case stated to the Supreme Court. 
In
Emerson v Hearty and Morgan [1946]
N.I. 35 Murphy L.J. described the required form at pp. 36-7 of the
report:





We
have thought that this may be a convenient opportunity to call
attention to the principles which ought to be observed in drafting
Cases Stated.


 


The
Case should be stated in consecutively numbered paragraphs, each
paragraph being confined, as far as possible, to a separate portion
of the subject matter.  After the paragraphs setting out the
facts of the Case there should follow separate paragraphs setting out
the contentions of the parties and the findings of the Judge.


 


The
Case should set out clearly the Judge’s findings of fact, and
should also set out any inferences or conclusions of fact which he
drew from those findings.


 


What
is required in the Case Stated is a finding by the Judge of the
facts, and not a recital of the evidence.  Except for the
purpose of elucidating the findings of fact it will rarely be
necessary to set out any evidence in the Case Stated save in the one
type of case where the question of law intended to be submitted is
whether there was evidence before the Judge which would justify him
in deciding as he did.





The
point of law upon which this Court’s decision is sought should
of course be set out clearly in the Case.  But we think the
Judge is certainly entitled to expect the party applying for the Case
Stated to indicate the precise point of law upon which he wishes to
have the decision of the appellate Court.  It would be
convenient practice that this should ordinarily be done in the
written application for the Case Stated.”


 


5.
This decision was applied by Blayney J. in
Mitchelstown Co-Operative Society v
Commissioner for Valuation
[1989] I.R.
210 and in
Department of the Environment
v Fair Employment Agency
[1989] N.I.
149.


 


In
Mitchelstown Co-Operative Society v Commissioner for Valuation
[1989] I.R. 210 at pp. 212-3 Blayney J., agreeing with and adopting
the principles set out by Murphy L.J. in Emerson v Hearty &
Morgan
[1946] N.I. 35, stated:


 


I
am in complete agreement with, and I respectfully adopt, this
statement of the principles to be observed, but an examination of the
case stated by the Tribunal shows that is has not been drafted in
accordance with those principles.


 


The
case does not contain any clear statement of the facts found by the
Tribunal.


 


.
. . This court should not be required to go outside the case stated
to some other document in order to discover them.





The
same principle applies to the contentions of the parties; the
inferences to be drawn from the primary facts, and the Tribunal’s
determination.  All these must be found within the case, not in
documents annexed . . .





.
. .


For
all the foregoing reasons I am satisfied that I must return the case
to the Tribunal for amendment and, if necessary, for re-statement”.’


[16]
Whilst the above remarks were made in the
context of s 16 of the Courts of Justice Act, 1947 of Ireland, the
principles enunciated therein apply equally to the present
proceedings.  A court can only deal with a stated case where the
facts are agreed upon and the court is asked to make a determination
of the inferences or the law to be drawn from those facts.


[17]
The difficulty in the present case emanated
from the way the stated case was formulated.


[18]
Para 1.2 of the stated case reads:


The
defendant
alleges
the accident was caused by the negligent unlawful driving of the
deceased . . .  (in that he) was driving the lane (
sic)
of oncoming traffic and collided head on with a truck driven by a
certain Mr L Jacobs.’


[19]
The meaning of the above statement is not
clear. The Fund was in fact saying the deceased had been the author
of his own misfortune and consequently his dependants could not
secure a benefit from the Fund in terms of the law.  The
plaintiff in that case, who is the present appellant, did not suggest
that, for the purposes of the stated case, the statement would be
accepted as correct.  Considering that the pith of s 10 of the
Act was that a party in the wrong should not benefit from his own
misdoing, it was vital that the parties agree on the factual position
on this aspect.  As it turned out the parties were not agreed
that the deceased had been at fault, a position that obtained even at
the hearing of this appeal.


[20]
Mr Frank, in para 21 of the respondent’s
heads, states that it is a matter of undisputed fact that the death
of the appellant’s husband was his fault and that had there
been any suggestion that there was a dispute in this regard, the
position would have been different.


[21]
In his oral submissions before this court,
Mr Namandje made it clear that it was not common cause before the
High Court that the deceased was the cause of the accident and that
at no stage had the appellant admitted this.


[22]
Indeed my brother Damaseb AJA was alive to
this difficulty when he prepared the lead judgment.  In para
[50] of the judgment he notes the divergence of views between Frank
and Namandje.  In para [65], he further noted that, faced with
two equally plausible scenarios of the stated case, the High Court
gave an unfair advantage by assuming that it was common cause that
the deceased caused his own death.  In para [68], he concedes
that the agreed facts were ‘at best ambiguous and at worst,
meaningless’. In para [77] Damaseb AJA, quite correctly in my
view, remarks that it is undesirable to resolve a matter on a stated
case where there is more that one possible interpretation of the
facts which, if accepted as an established fact, may lead to a
different legal conclusion and that the court
a
quo
could have quite properly refused
to determine the matter on the basis that it was a stated case.


[23]
As Damaseb AJA quite correctly comments in
para [72] of the judgment, no-one knows quite how, when and why the
Fund had a change of heart and why it then alleged that the deceased
had been at fault.  We do not know whether the Fund knew, at the
time it attempted to settle the matter, that the deceased had been at
fault.  We do not know whether this was a fact which later came
to the attention of the Fund.  In my view, the proceedings
having been brought by way of stated case, it is undesirable and
perhaps even wrong, given the divergence between the two parties on
this crucial issue, to infer that the respondent must have been
satisfied that the deceased had been at fault.


[24]
In including the narration that the
respondent was alleging that the deceased had been at fault in the
stated case, the parties should have gone further to clarify what the
respective position of each of the parties was on this contentious
issue.  Instead the matter was left hanging and, not
surprisingly, the High Court proceeded on the basis that this was
common cause, when in fact it was not.


[25]
In the result, I am of the considered
opinion that not all the facts were placed before the High Court and
that the court did not have the capacity, in the absence of further
clarification or evidence, to resolve the matter.  Since the
pith of the matter was whether the deceased had been at fault, the
court
a quo
should, in the circumstances, have refused to deal with the matter as
a stated case and referred it to trial in the ordinary way. The court
misdirected itself in proceeding to assume that it was common cause
that the deceased had been at fault.


[26]
Given the above finding, it seems to me
that the appropriate order should have been one referring the matter
to trial in terms of the rules in the ordinary way.


[27]
On the question of costs I am of the view
that, since neither party has been more successful than the other and
since both parties were at fault in not clearly stating whether the
deceased unlawfully caused the accident, each party should pay its
own costs, both in this court and the court
a
quo.


[28]
In the circumstances, I would set aside the
decision of the court
a quo
and make the following order:


1.
The appeal succeeds and the matter is referred back to the High
Court.


2.
Each party is to pay its own costs on appeal and in the court a
quo.


3.
The order of the High Court is set aside and in its place the
following order is substituted:


The
matter is referred to trial in terms of the Rules of this Court.’





GARWE
AJA





ZIYAMBI
AJA


[29]
I have read the judgments of my brothers
Damaseb AJA (as he then was) and Garwe AJA.


[30]
I am inclined to agree with the views of
Garwe AJA that there was no stated case before the High Court, and
that, for that reason, the matter ought to have been referred to
trial. I therefore agree that the appeal should be allowed and that
each party should pay its own costs, both in this court and in the
court
a quo.


ZIYAMBI
AJA





DAMASEB
AJA (dissenting):


[31]
This
is an appeal against a judgment and order of the High Court in
respect of a case stated to it by the parties in terms of old rule
33(1) of the Rules of the High Court.  The respondent (the Fund)
is a statutory body created by the repealed Motor Vehicle Accidents
Fund Act[1] (the Act) with,
inter
alia
,
the following objects contained in s 10 of the Act:





(1)
The Fund shall –





(a)
subject to this Act, in the case of a claim
for compensation under this section arising from the driving of a
motor vehicle where the identity of the owner or the driver of the
motor vehicle has been established; or





(b)
subject to a regulation made under section
17, in the case of a claim for compensation under this section
arising from the driving of a motor vehicle where the identity of the
owner or the driver has not been established,





pay
out compensation to a person who has suffered loss or damage as a
result of bodily injury to himself or herself, or bodily injury to or
the death of any person, in either case caused by or arising out of
the driving of a motor vehicle by any person at any place in Namibia,
if the injury or death was due to negligence or other unlawful act of
the driver of the motor vehicle in question, the owner of the motor
vehicle in question or of an employee of the owner of the motor
vehicle in the execution of that employee’s duties as an
employee of the owner of that motor vehicle.’





[32]
In
terms of s 3(1)
(b)
of the Act, the Fund was given the function ‘to investigate and
settle, subject to this Act, claims arising under s 10’. As the
court
a
quo

correctly found, this function authorised the Fund ‘to enter
into compromises[2] of claims
arising under s 10’.






[33]
The plaintiff by way of combined summons
commenced action in the High Court seeking the following relief:


(a)
Payment in the amount of N$77 887,31;





(b)
Interest at 20% per annum from the date of judgment to the date of
final payment;


 


(c)
Costs of suit;


 


(d)
Further and or alternative relief.’





The
plaintiff relied on a written agreement concluded on 24 January 2006
in terms of which the Fund, as the appellant alleges, was bound to
make the payments. She specifically alleges that the Fund breached
the agreement between the parties when it failed or refused to pay
the payments demanded, and further when it unlawfully and
unilaterally purported to repudiate its obligations by cancelling the
agreement.


[34]
The claim was a sequel to a purported
cancellation by the Fund of an agreement concluded between the
appellant and the Fund in relation to a claim submitted by the
appellant to the Fund following the death in a motor vehicle accident
of the appellant’s husband and father of their three minor
children on whose behalf the appellant is acting. The appellant had
sued the Fund in her personal capacity and, in a representative
capacity, on behalf of the minor children of the marriage. The cause
of action was based on a written agreement (the settlement agreement)
concluded on 24 January 2006 in the following terms:


The
parties have now agreed that the settlement, and the Fund’s
performance in terms of that settlement,
constitutes
the full and final settlement of all and any claims of whatever
nature, present or future, whether for capital costs,

whether for future or unascertained damages that the Claimant may now
or hereafter have against the Fund in law, which arise out of the
accident stipulated in the MVAF1 Claim form submitted by the Claimant
to the Fund.’
(Own emphasis.)





This
document constitutes the sole record of the agreement between the
parties in regard to the subject matter thereof.  No addition,
variation or
cancellation of this
agreement shall have any force or effect unless in writing and signed
by or on behalf of all the relevant parties.
’ 
(Own emphasis.)





[35]
The terms of agreement dated 24 January
2006 provide as follows:


(a)
Pay the plaintiff an amount of N$72 559,91 upon conclusion of the
agreement;





(b)
Pay to the plaintiff for herself and on behalf of the minor children
referred to hereinabove as a guardian during December 2006 amount of
N$31 154,84 for plaintiff, an amount of N$15 577,49 for the minor
child Ndeya A Mbambus, an amount of N$15 577,49 for the minor child
Ezer N Mbambus and an amount of N$15 577,49 for the minor child Lea N
Mbambus.’





[36]
It is common cause that the settlement
agreement was preceded by a letter dated 19 December 2005 (the
initial letter) written to the plaintiff by the Fund’s Claims
Assessment Manager in the following terms:


The
claim refers. Attached please find a draft agreement that contains
proposals for the settlement of your claim. If you find the proposed
terms acceptable, kindly please sign the agreement and return it to
the Fund.
When the Fund receives a
signed agreement from you, one of the Fund’s Managers will
review all aspects of the claim, including the evidence and
documentation submitted by you. If everything is found to be in
order, the Fund will also sign this agreement
,
whereupon your claim will be settled. Once this has happened, the
Fund will process your payment.’
(My
underlining for emphasis.)


[37]
It is an important consideration that in
terms of s 13(2) of the Act:


If
the Fund does not, within 60 days from the date on which a claim was
sent or delivered to it as prescribed, object to the validity of that
claim, that claim shall for all purposes, be deemed to be valid in
law.’


This
provision makes clear that the Fund had to conduct whatever
investigation it deemed necessary to establish liability with some
urgency and that if no objection was made to the claim it was, by
law, a valid claim regardless of the circumstances. If objection was
made, a dispute and potential litigation would have arisen.


[38]
The Fund paid to the plaintiff the initial
amount of N$72 000 in terms of the settlement agreement. 
Thereafter, the Fund refused to pay the balance of the agreed amount
purporting to cancel the agreement on the ground that it had no
competence to settle a claim in relation to a driver who was the
negligent cause of an accident. That purported cancellation was
recorded in a letter of 21 December 2006 written by the Fund’s
Claims Assessment Manager as follows in so far as it is relevant for
present purposes:


On
the 24 January 2006 the Fund settled a claim for loss of support
arising out of an accident which occurred on 24 February 2006 (sic)
in which Fillemon Mbambus was regrettably killed. The facts of the
accident were that the accident was due to the  negligent
/unlawful  driving of the deceased Fillemon Mbambus. The
deceased . . .  was driving in the lane of oncoming traffic and
collided with a truck driven by L Jacobs. The deceased was the sole
cause of the accident and is found to have been the author of his own
misfortune. The deceased thus failed to prevent an accident in
circumstances where a reasonable driver would have driven cautiously
and would have kept in his lane. By Board resolution dated 26 October
2006 the Fund accepted legal advice it received from two senior
counsels (sic) that unfortunately it is not permitted to pay on a
claim submitted by a dependent of a deceased person if that person
was killed in a motor vehicle accident caused by himself or herself.
So if a person kills himself or herself the children of such person
have no claim on the Fund. The reason for this is that in terms of
section 10(1) as read with section 10(4) of the [Act], the Fund is
only allowed to pay for loss or damage arising out of an accident
that is caused by a driver or owner of a motor vehicle who is not the
person claiming or is not a dependent of such person. In the
circumstances the Fund has concluded that it was in error in settling
this claim.


.
. .


Please
note that the Fund does not seek to recover the monies that it has
already paid . . . .’





[39]
The appellant then started a process to
exact payment of the balance of the agreed compensation by way of
summons in the High Court. The Fund defended the action and the
appellant applied for summary judgment in the High Court and failed,
and the Fund was granted leave to defend the action. The Fund
resisted the claim on the basis that it:





.
. . is a creature of statute and only has the powers and authority
conferred on it by the creative deed. The creative deed (i.e. The
Motor Vehicle Accidents Fund Act, 2001) provides in section 10 the
basis of liability by the Fund. Section 10(1) as read with section
10(4) of the Motor Vehicle Accidents Fund, 2001 precludes the Fund
(The Defendant) from paying any compensation to a person who suffered
damages if the damages were caused by his or her own negligence . . .
the Defendant further pleads that the agreement purportedly concluded
by the Defendant with Plaintiff is
ultra
vires
its powers and thus void ab
initio.





.
. . that since the agreement between it and the Plaintiff is void ab
initio
there is no valid agreement which it could breach.’





[40]
Upon the matter becoming defended, the
parties agreed to state a special case from which the history of the
matter becomes partially apparent.



Facts agreed in
terms of rule 33(1)


[41]
The parties stated a case under rule 33(1)
as follows:


1.1.
On 24 February 2005, the plaintiff’s husband, the late
Fillemon Mbambus, was killed in a Motor Vehicle Collision (sic),
which occurred on the Western Bypass, in Windhoek.





1.2.
The Defendant alleges the accident was caused by the negligent,
unlawful driving of the deceased . . . [in that he] was driving [in]
the lane of the oncoming traffic and collided head on with a truck
driven by a certain Mr L Jacobs.





1.3.
Following the death of her [h]usband, the Plaintiff on behalf of
herself and the minor children from the marriage between her and her
late husband submitted a claim in terms of the Motor [V]ehicle
Accidents Fund Act, 2001 [Act 4 of 2001].





1.4.
The Defendant accepted the claim and on 23 January 2006 entered into
an agreement with the Plaintiff to compensate the Plaintiff and her
three minor children in respect of the future damages which they
suffered.  A copy of the agreement is annexed hereto and marked
“A”.


 


1.5.
On the 3rd of October 2006 the Defendant wrote to the
Plaintiff and informed her that the Defendant had made a mistake by
accepting liability and paying out her claims. The Defendant further
informed the Plaintiff that the agreement concluded on 23 January
2006 was a nullity in that it (‘the Defendant’) did not
have the power to conclude such an agreement.  A copy of the
letter is annexed hereto and marked as “B”.


 


1.6.
After the Plaintiff  received the letter mentioned in
 paragraph (e) she  issued summons . . . against the
Defendant claiming payment in the amount of N$72 559,91. The
Defendant entered notice to defend the action.


 


1.7.
After the Defendant entered notice of intention to defend, the
Plaintiff invoked the provisions of Rule 32 of the High Court Rules
and applied for summary judgment.  The High Court of Namibia
granted the Defendant leave to defend the action.


 


1.8.
After this Honourable Court granted the Defendant leave to defend the
action the parties agreed to in terms of Rule 33 of the High Court
Rules present a stated case to the court for adjudication.






[42]
Having thus set out the agreed facts, the
parties stated the issue for determination by the court as follows:





The
issue which the parties want this Honourable Court to adjudicate is
whether the Defendant can escape liability in terms of the settlement
agreement by relying on a defense pertaining to the original cause of
action. In other words, can the Defendant rely on the Motor Vehicle
Funds Act, 2001 to escape liability under the settlement agreement?’







Proceedings in
the High Court


[43]
It is common cause that in the High Court
the appellant relied on a compromise, being the settlement agreement
between the parties, and not on the original cause of action; in
other words, she did not sue the Fund as contemplated in s 13(4).
This is the point that the majority judgment overlooked.


[44]
The
High Court correctly stated the nature and effect of a compromise as
discussed by this court in
Metals
Australia Ltd and Another v Amakutuwa and Others
[3],
as follows:


A
compromise is a form of agreement the purpose of which is to put an
end to existing litigation
or to avoid
litigation that is pending or might arise because of a state of
uncertainty
between
the parties
. Ordinarily, the validity
of an agreement of compromise does not depend on the validity of a
prior agreement. An agreement of compromise may follow upon a
disputed contractual claim but
it may
also follow upon any form of disputed right and “maybe entered
into to avoid even clearly spurious claim.”

Hamilton v Van Zyl
1983 (4) SA 379 (E) at 383E-F.  The effect of an agreement is
that it bars the bringing of proceedings on the original cause of
action’. (My underlining for emphasis; case references
omitted.)





[45]
In Metals
Australia
, the Supreme Court went on to
add at para 27 that:


The
validity of an agreement of compromise does not generally depend on
the validity of any contract it replaces. Nevertheless for it to be a
binding contract, the compromise agreement must have been properly
concluded.’





[46]
The
learned judge
a
quo

also appropriately referred to a Zimbabwean Supreme Court case[4]
in which the nature of a compromise (or
transactio)
was further elaborated in the following terms:





Compromise,
or
transactio,
is the settlement by agreement of disputed obligations, or of a
lawsuit the issue of which is uncertain. The parties agree to
regulate their intention in a particular way, each receding from his
previous position and conceding something – either diminishing
his claim or increasing his liability. The purpose of compromise is
to end doubt and to avoid the inconvenience and risk inherent in
resorting to the methods of resolving disputes. Its effect is the
same as
res judicata
on a judgment given by consent. It extinguishes
ipso
jure
any cause of action that
previously may have existed between the parties, unless the right to
rely thereon was reserved. As it brings legal proceedings already
instituted to an end, a party sued on a compromise is not entitled to
raise defences to the original cause of action. But a compromise
induced by fraud, duress,
justus error,
misrepresentation, or some other ground for rescission is voidable at
the instance of the aggrieved party, even if made an order of court.
Unlike novation, a compromise is binding on the parties even though
the original contract was invalid or even illegal.’ (Case
references omitted.)



The judgment of
the court a quo


[47]
The learned judge a
quo
rejected the argument advanced by
Mr Namandje, counsel for the appellant
a
quo,
to the effect that through the
compromise and defendant’s resultant acceptance of liability,
the issue whether the claim fell within the ambit of s 10 was
irrevocably settled by way of compromise.


[48]
The High Court concluded that the Fund did
not have the competence to conclude the compromise in respect of the
appellant’s claim as the compromise did not comply with s 10(1)
of the Act. The learned judge
a quo
declared the compromise null and void
ab
initio.
The court justified this
conclusion on the principle of our law that a body created by statute
may only exercise such power as is granted by the statutory
instrument creating it. As the learned judge put it at para 10:


The
principle is well-established and clear that a public body created
for a particular purpose with statutory powers cannot validly
exercise powers not expressly or impliedly authorised
(De
Villiers v The Pretoria Municipality,
1912
T.P.D. 626).  The very purpose for which the defendant is
constituted is to pay compensation to a person who has suffered loss
or damage as contemplated in section 10.  By virtue of section
3(1)
(b)
the defendant was given the function “to investigate and
settle,
subject to this Act,
claims arising under section 10.” (Original emphasis)  It
is significant that the defendant is granted the express power to
settle claims, in other words, to enter into compromises of claims
arising under section 10.  By referring to section 10,
the
power to settle is limited to claims where the claimant is not the
driver, or a dependant of the driver, by whose negligence the injury
or damage was caused.  By incorporating the words ‘subject
to this Act’ any conceivable doubt whether the defendant may
settle claims which do not comply with section 10 is, to my mind,
removed.
Clearly the defendant may not
do so.  In view of the clear intention conveyed by the express
provisions it is not necessary to consider whether such a power is
impliedly given. I therefore agree with Mr Ueitele’s submission
that the defendant did not have the statutory power to enter into the
compromise concerning a claim which did not comply with section 10.
As such the compromise is null and void
ab
initio.
’ (Emphasis supplied.)


[49]
The
appellant seeks to impugn this reasoning on appeal, as I understand
it, not so much because the principle stated is wrong, but that it
finds no application on the facts of the present case. Mr Namandje
argued on behalf of the appellant that the
ultra
vires

doctrine ensconced in
Skeleton
Coast Safaris Pty) Ltd v Namibia Tender Board and Others
[5]
and
Metals
Australia Ltd and Another v Amakutuwa and Others

finds no application in this case. He argued that if this court
accepts the view taken by the court
a
quo
,
the Fund will never be in a position to compromise any claim. 
Mr Namandje also argued that absent a denial of the authority of the
functionaries who signed the compromise, the Fund was disbarred from
resiling from the agreement of compromise.





[50]
It is apparent from the manner in which the
court a
quo
approached the matter in the written reasons that it assumed, and
proceeded from the premise, that it was common cause that the
deceased’s negligence caused his death. It is necessary to
consider if it was not a misdirection for the court to proceed on the
basis that it was common cause between the parties in the stated case
that the deceased caused his own death. Mr Frank argued in the appeal
that it was indeed common cause and Mr Namandje argued that it was
not and that, in any event, that was irrelevant because of the
compromise which resulted at the initiative of the Fund.



The appellant’s
submissions on appeal


[51]
Mr Namandje argues that the judge a
quo
erred in holding the compromise
null and void on the basis that the Fund was not competent to settle
a claim based on the allegations that the deceased was the cause of
the accident that caused his death. Mr Namandje argued that in so
finding the learned judge
a quo
failed to take into account the fact that the Fund, upon receiving
the claim from the appellant, initiated the process that resulted in
the compromise, representing that its officials would review ‘all
aspects of the claim, including the evidence and documentation
submitted’ by the appellant in support of her claim before
settling the matter. Mr Namandje also submitted that the court
a
quo
failed to have regard to the fact
that the officials of the Fund prepared the document which
constituted the compromise and therein stated that it was in ‘full
and final settlement’ and not subject to cancellation or
variation unless agreed to in writing by both parties. Mr Namandje
also argued that the Fund's claim of lack of competence or capacity
is undermined by the fact that it, in the purported letter of
cancellation, waives the right to recover the initial N$72 000 paid
in furtherance of the compromise. As he put it ‘So if it has
power to compromise payment made already why could it not compromise
future liability to pay the outstanding instalments?’.


[52]
Finally, Mr Namandje ominously expressed
concern that the result reached by the court
a
quo
limits the ability of the Fund to
settle any claim in future in circumstances of uncertainty about
liability on the merits and that, in addition, it opens the door for
the respondent, for tactical reasons, to compromise a claim at a
certain time only to renege on it later claiming want of capacity.


[53]
Although he does not assign any legal label
thereto, in my view, Mr Namandje’s submissions raise against
the Fund two important principles of our law:
contra
preferentem
and declaration
against own interest
, or a combination
of the two.



Contra
preferentem rule


[54]
As Christie aptly remarks:


The
proferens
is the party to the contract who, whether personally or through his
agent, is the author of the wording of the contract, and the
rationale
of
the
contra
preferentem

rule is simply that, if that wording is incurably ambiguous, its
author should be the one to suffer because he had it in his power to
make his meaning plain.
[6]






Declaration
against interest


[55]
It is a trite principle of our law that:





A
declaration by a person who is still alive, however relevant, is, as
a rule, inadmissible;
but
if he be a party to the action, any statement made by him against his
interest can be put in evidence against him as an admission
.’[7](My
underlining for emphasis.)


The
respondent’s submissions on appeal


[56]
It is not the respondent’s case that
the Fund may not settle a claim in respect of which it disputes
liability.  Mr Frank agreed that the result he proposes is in no
way intended to preclude the Fund from setting a disputed claim. 
Thus, the Fund may settle a claim on the merits in order, in the
words of this court in
Metals Australia,
‘to put an end to existing
litigation or to avoid litigation that is pending or might arise
because of a state of uncertainty between the parties’. The
competence to settle a disputed claim must necessarily be implied in
the s 10 objects and powers of the creative deed. That concession is
properly made, otherwise it would yield the absurd result that the
Fund could under no circumstances settle a claim, unless and until it
has been found liable by a competent court.  Public policy
militates against such a result.


[57]
That said, the respondent maintains that it
is impermissible to read into that object a power to settle a claim
that defeats the very essence of the power – to pay claims
where injury or death resulted from the negligent conduct of a third
party. What sets this case apart, according to the respondent as I
understand it, is the fact that the officials of the Fund purported
to settle a claim which, the Fund alleges, involved an accident in
which the Fund considered the deceased to be the author of his own
misfortune and demise. The gravamen of the respondent’s
opposition to the appeal is premised on the principle of legality,
which postulates that all administrative and governmental action must
be founded on and be sourced in law.


[58]
Therefore, the respondent urges, the appeal
must fail because the agreed facts assume that the Fund considered
that the deceased was the cause of his own death – a
circumstance which makes the Fund not liable in terms of the creative
deed.


Just
what did the parties state?


[59]
Both counsel have accepted that the events
leading up to the settlement agreement constitute evidential material
alongside the stipulations recorded in their stated case.


[60]
The only reference in the body of the
stated case to the subject of the cause of the accident is that:


The
Defendant
alleges
the accident was caused by the negligent, unlawful driving of the
deceased . . . [in that he] was driving [in] the lane of the oncoming
traffic and collided head on with a truck driven by a certain Mr L
Jacobs.’ (My underlining for emphasis.)





Thereafter
it is recorded that:


On
the 3
rd
of October 2006 the Defendant wrote to the Plaintiff and informed her
that the Defendant had made a mistake by accepting liability and
paying out her claims. The Defendant further informed the Plaintiff
that the agreement concluded on 23 January 2006 was a nullity in that
it (the Defendant) did not have the power to conclude such an
agreement.’







The effect of
agreeing to facts in a stated case


[61]
Mr
Frank argued that the allegations made in the stated case imputing
negligence on the deceased must be taken as accepted or as being
common cause. He relies on
Montsisi
v Minister van Polisie
[8]
where
the following, as loosely translated from Afrikaans to English by Mr
Frank, is stated:




It
seems to me that the parties required the court
a
quo
to give its decision on the
assumption that the allegations contain


ed
in paras [2] – [5] and 12(11) of the stated case were agreed
facts. The case was also argued in this court on that basis’.





[62]
It is clear therefore that in Montsisi
not only was the court satisfied that the facts stated were common
cause but that it was argued in the court on that basis. As I will
soon show, that is not so in the case before us and, therefore,
Montsisi
does not apply.





[63]
The appellant faces an
insurmountable obstacle if it is the case that the agreed facts
postulated, as proposed by Mr Frank, that it was ‘accepted’
that the deceased was the author of his own demise. That difficulty
becomes the respondent’s if it is demonstrated that, faced with
whether or not it may at trial establish that the deceased was
negligent, the Fund entered into the compromise. As I understand the
respondent’s argument, a compromise was possible in the latter
scenario but not in the first. The Fund has power to settle a
disputed claim in the interest of avoiding costly litigation and in
circumstances where there is uncertainty as to whether or not it will
prevail at trial in due course. The High Court correctly found that
to be the case. However, the Fund does not have the power to settle a
claim where it is accepted that the deceased whose death gives rise
to the claim was the negligent cause of the accident and, therefore,
his death.


[64]
Contrary to Mr
Namandje’s suggestion that the authority of the officials who
concluded the settlement agreement was not denied, and that it is
irrelevant that the Fund denies liability, the relevant inquiry is
when and why the Fund settled the appellant’s claim. A valid
settlement (compromise) eventuates if it was entered into in order to
avoid litigation as contemplated in s 13(4) but not because it
mattered not whether the claim was s 10(1) – compliant. That is
so because, in the realm of public law, there is a purpose
independent of, superior and for that reason indifferent to, the
manifested actions of public officials at any given time. That
purpose,
which represents the greater public good and interest, is expressed
by the legislature in the objects and functions given to a statutory
body or to public officials in the legislation establishing such
bodies or vesting power in such officials. Those objects and
functions serve as a beacon for the actions of statutory bodies and
public officials.  If they overstep the boundaries established
by the objects and functions, the relevant actions are rendered
ultra
vires
and
thus liable to review. Similarly, if they fail to perform the
functions which under a statute they are required to perform, this
entitles aggrieved persons to exact compliance through
mandamus.
In the present case, the all-important purpose is represented by the
objects and functions memorialised in ss 3(1)
(b)
and 10(1).


[65]
The entire history of the matter is such
that it was just as plausible to assume that in framing the stated
case in the way the parties did, the appellant was postulating that
although not admitting that the deceased caused his own death, that
allegation was in any event irrelevant because the matter had already
been compromised. Faced with two equally plausible scenarios or
interpretations of the stated case, only one of which it considered,
the court a
quo
in assuming that it was common cause that the deceased caused his own
death gave an unfair advantage to one party instead of seeking to
untie the Gordian knot created by the stated case.  It is trite
that:


The
Court will lean to that interpretation which will put an equitable
construction upon the contract and will not, unless the intention of
the parties is manifest, so construe the contract as to give one of
the parties an unfair or unreasonable advantage over the other.
[9]





[66]
And as succinctly stated by Brand JA in
South African Forestry Co Ltd v York
Timbers Ltd:





While
a court is not entitled to superimpose on the clearly expressed
intention of the parties its notion of fairness, the position is very
different when a contract is ambiguous. In such a case, the principle
that all contracts are governed by good faith is applied and the
intention of the parties is determined on the basis that they
negotiated with one another in good faith’.[10]





[67]
A
consensus between two people entered into seriously and deliberately
is an enforceable agreement.[11]
Obviously in this case, the compromise was intended to avoid the
vagaries of trial. Being an agreement, the legal principles
enunciated above apply.


[68]
In my view, the agreed facts and the
statement of the issue were, at best, ambiguous and, at worst,
meaningless. They certainly did not, as contended by Mr Frank,
justify the conclusion that it was common cause that the deceased
negligently caused his own death. The background to the compromise
does not support such a conclusion. That background is that the
Fund's officials represented to the appellant that they would
investigate the matter and only settle the claim if they were
satisfied that it justified settling. In the letter of cancellation,
the respondent provides no basis whatsoever why, since concluding the
compromise, it came to the conclusion that the deceased was the
author of his own demise.


[69]
The following submissions by Mr Frank in
his written heads of argument constitute a concession that the stated
case is ambiguous:


The
issue for adjudication agreed to for determination by the Court
a
quo

is
unfortunately not very clear at all
.
One issue seems to be contemplated by stating the issue and then an
attempt is made to reiterate it in “other words” when a
totally different question is posited.
[12]
(My underlining for emphasis.)





[70]
At para 16 Mr Frank states:





16.1.
The question that is initially raised is: Can defendant “escape
liability in terms of the settlement by relying on a defence
pertaining to the original cause of action”.





16.2.
The second question is: Can the defendant “rely on the Motor
Vehicle Funds Act, 2001 to escape liability under the settlement
agreement” ’.





[71]
And at para 13 as follows:


It
is submitted it is clear from the pleadings and the proceedings in
the Court a
quo
that the real question was whether the Fund could rely on the fact
that it was not empowered (authorised) under the Act to compensate
appellant in circumstances where her ex-husband caused his own death
(negligently) to resile from the agreement.





My
finding that the deceased causing his death was not common cause
takes the sting out of this argument.


[72]
In its stated case, the Fund alleged that
the deceased caused his own death. We know not how, when and why that
change of heart occurred if regard is had to the document which the
Fund itself authored accepting liability – one can safely
assume on the basis that they were satisfied at the time that the
jurisdictional facts for liability were satisfied. How else can one
explain their prior recording in the letter of 19 December 2005 that
the Fund would ‘investigate all relevant facts and
circumstances’ before settling? In light of the foregoing, the
leap from a denial of liability by the Fund to ‘acceptance by
both parties that the deceased authored his own death’; or the
leap from the denial of liability to ‘it was established that
the deceased caused his own death’, is most unfortunate. The
most that could be said in favour of the Fund is that they retracted
the initial acceptance of liability. Even then, the issue remains
whether the Fund was entitled to do so. It is noteworthy that the
stated case asked the question whether the Fund could escape
liability in terms of the settlement agreement by relying on a
defence pertaining to the original cause of action. Again, this
aspect is overlooked by the majority judgment.


[73]
I make no challenge to the court’s
finding that the power to compromise claims is limited by necessary
implication to claims where ‘the claimant is not the driver, or
a dependant of the driver, by whose negligence the injury or damage
was caused’.  However, I have difficulty with the
inference drawn that a mere after-the-fact recording in a stated case
that the Fund disputes liability obliterates the prior history of the
matter which includes a conscious endeavour and decision by the Fund
to, well-knowing what the legal position was, compromise a claim
after investigating all the circumstances and evidence relating to
it.


[74]
The court a
quo
made no attempt at all to examine
if there were circumstances, based on the common cause background to
the settlement agreement, that would allow the Fund to escape
liability. The question posed asked the court to do that very thing.
It asked:





Whether
the defendant can escape liability in terms of the settlement
agreement by relying on a defence pertaining to the original cause of
action’.


[75]
The fact that we do not know when and how
the Fund came to the conclusion that the deceased caused his own
death gives poignancy to Mr Namandje’s ominous warning that,
unless the Fund is held to compromises it makes, there is a danger in
the Fund settling claims for tactical reasons only to renege on them
for lack of competence if and when circumstances suit it.


[76]
In my view, the obvious answer to the first
leg of the question posed, in light of the principles governing a
compromise, is that the Fund could not escape liability on the basis
‘stated’, unless it was demonstrable that it was induced
by fraud, duress, justus error, misrepresentation or some other
ground for rescission such as, as found by the court
a
quo
, lack of capacity in the statutory
body. That much is conceded by Mr Frank. The onus must of necessity
rest on the party who seeks to avoid the compromise, given that by
all appearances the compromise was a valid instrument. In determining
if it was discharged, the court cannot reasonably ignore all the
evidential material against the backdrop of the pleadings as they
stood.


[77]
It is most undesirable to resolve a matter
on a stated case basis where there is more than one possible
interpretation of the facts - each of which, if accepted as an
established fact, may lead to a different legal conclusion. The court
a quo
could quite properly have rejected to determine the case on a stated
case basis and required the parties to lead evidence
a
propos
the circumstances that led to
the agreement and on that basis decide if it was void
ab
initio
. If the jurisdictional facts for
a valid compromise existed, i.e. a disputed but uncertain claim, the
compromise would have been valid, but if it was clear to both parties
that the deceased was the negligent driver, the compromise was null
and void:
cadit quaestio.
Regrettably, the court
a quo
opted to determine the stated case in its imprecise form.


[78]
The court a
quo
, as we know, had no regard
whatsoever to the history of the matter. I consider that to be
misdirection. If it had, it would have had to weigh the allegation of
negligence attributed by the Fund to the deceased in the plea and in
the stated case against the prior conduct of the Fund. That would, in
turn, have required the court to consider whether the after-the-fact
denial of liability by the Fund was, in reality, not the kind of
circumstance which, under the law relating to compromise, was
inexcusable. The allegation that the deceased caused his own death
does not stand in isolation. If it did, it would have been safe to
proceed on the assumption that in the stated case the parties
proceeded on the common cause basis, in view of the Fund’s
allegation, that the deceased caused his own death.


[79]
It occurred to me whether or not the matter
was not best remitted to the trial court in view of what I consider
to be this ambiguity. I am satisfied though that that is not
necessary because:


When
a stipulation is capable of two meanings, it should rather be
construed in that sense in which it can have some operation than in
that in which it cannot have any.
[13]


[80]
As
Professor Christie argues, and I agree, ‘this rule is very much
alive in the modern law.’[14]
As I will show presently, the ambiguity in the stated case, in my
view, provides the basis for the application of the
contra
preferentem

rule.





[81]
In light of the circumstances leading up to
the conclusion of the agreement, it is difficult to reconcile the
conclusion reached by the court
a quo
on the question it was asked to answer with the trite principle of
our law that a compromise is binding on the parties even though the
original contract was invalid or even illegal.


[82]
On the facts before us, the contra
preferentem
rule favors the inference
that the respondent may have had doubt if the deceased was negligent
but chose not to subject itself to the vagaries of a trial. That, it
is clearly conceded on behalf of the respondent, would have yielded a
valid compromise.


[83]
It is impermissible for the Fund to settle
by compromise a claim which arises from the unlawful conduct of the
claimant or the unlawful conduct of the deceased on whom a claimant
was dependent. If it was established that it sought to compromise
such a claim, it acted
ultra vires
and the compromise would be null and void
ab
initio
. That much is clear from this
court's judgment in
Metals Australia.
But that is not what we are faced with here. The respondent by its
conduct created the belief that it considered the claim and settled
it in order to eschew litigation. That fell within its competence,
i.e. to investigate and settle claims in terms of s 3(1)
(b).
It has power to settle a claim which may well be doubtful as to its
merit but not deserving of protracted litigation. That is a perfectly
legitimate incidence of the power given to the Fund under the
creative deed.


[84]
It is apparent from the initial letter by
the Fund that it represented to the appellant that: (a) it was aware
that only certain claims are permissible; (b) it in such full
awareness resolved to conduct an investigation to determine if the
claim fell within the class of claims it was allowed by law to pay;
(c) that the documents submitted showed how the accident occurred;
and (d) from the evidentiary material it could make an assessment of
the
bona fides
of the claim and object if necessary. Further, acting against its own
interest, the Fund engaged in the following conduct: (a) it initiated
the settlement agreement in which it is said that the terms are in
full and final settlement and not susceptible to cancellation or
variation without mutual consent; and (b) immediately made partial
payment in terms of that agreement.


[85]
The historical backdrop to the conclusion
of the stated case was, as correctly submitted by Mr Namandje, and
with the greatest respect, given no weight at all by the court
a
quo
in resolving the critical question
it had to resolve as to whether the settlement agreement was a valid
compromise untainted by lack of capacity. If the issue was approached
in that way rather than in the formulaic fashion of posing the
question ‘can a statutory body enter into a compromise to
settle a claim involving an accident caused by the deceased driver’,
it would have become apparent that the issue it had to determine was
whether, on the facts, the Fund’s conduct amounted to a valid
compromise. One could not take the denial of liability in the stated
case on face value in light of the previous conduct of the Fund. It
was important for the court
a quo
to be satisfied, in light of the declarations against interest
contained in its letter of 19 December 2005, that the Fund
established non-liability based on
ultra
vires
from what, by all appearances,
was a regular compromise in terms of which it even made part payment
and later opted to waive reclaiming it.  In light of the
agreement and the correspondence preceding it, the true inquiry posed
by the stated case was whether the Fund was entitled to avoid the
compromise and not whether it can pay a claim not authorised by the
creative deed.


[86]
The approach taken by the court a
quo
mirrors the very thing a compromise
is intended to eschew: you cannot rely on the original defence to
avoid a compromise.


[87]
What was difficult for the Fund to
stipulate in the contract that it was concluding the agreement and
making the payments subject thereto that the deceased was not the
cause of his own death? All the Fund needed to do in order not to
incur liability by default, as contemplated in s 13(2), was to object
to the claim. That would have necessitated the appellant initiating
legal proceedings, subject to s 13(3) which provides:


No
person shall commence legal proceedings against the Fund for the
purposes of obtaining compensation under this Act unless –





(a)
he or she has lodged a claim which complies
with this section; and





(b)
a period of 120 days has expired from the
date that the claim was delivered or sent to the Fund as prescribed.’


[88]
The
Fund’s failure to do so must lead to the inference that it was
satisfied that the deceased did not cause his own death or that they
were unable to prove that he had. The allegation that the deceased
caused his own death, without it being common cause between the
parties, is not a sufficient ground for the conclusion that s 10 of
the Act was breached. After all, a compromise is perfectly
permissible even where the stipulator is convinced of the
hopelessness of the opponent’s case as long as it was done in
order to avoid litigation.[15]


[89]
For all of the above reasons, I find myself
in respectful disagreement with the result arrived at by the High
Court. I do so, in a nutshell, on the interrelated grounds that the
Fund, in regard to the settlement agreement and its content, was
proferens
and engaged in conduct subsequently against its own interest so as to
be presumed to have conceded that it settled the appellant’s
claim in order to avoid litigation – a perfectly legitimate
reason for a valid compromise in terms of s 10 read with s 3(1)
(b)
of the Act.



The order


[90]
In the result:


1.
The appeal is allowed, with costs.


2.
The order of the court a
quo
is set aside and substituted for
the following order:


The
question posed by the parties is answered in favour of the plaintiff
and the defendant is ordered to pay to the plaintiff:


(a)
The amount of N$77 887,31;


(b)
Interest at rate of 20% per annum from date
of judgment to date of final payment.


(c)
Costs of suit.’


DAMASEB
AJA





APPEARANCES


APPELLANT:
S Namandje


Instructed
by Sisa Namandje & Co Inc





RESPONDENT:
T J Frank, SC


Instructed
by Ueitele & Hans Co Inc



[1]
Act
4 of 2001, repealed by Act 10 of 2007.




[2]
The
nature and effect of a compromise is discussed at paras [13], [14]
and [15] of this judgment.




[3]
2011
(1) NR 262 (SC) at 268 para 21.




[4]
Georgias
and Another v Standard Chartered Finance Zimbabwe Ltd

2000 (1) SA 126 (ZS) at 138I-139D.




[5]
1993
NR 288 (HC) at 299J-300A.




[6]
R
H Christie,
The
Law of Contract in South Africa

5 ed (2006) at 224 and also see
Cairns
(Pty) Ltd v Playdon & Co Ltd

1948 (3) SA 99 (A).




[7]
Edmund
Powell et al, Powell’s
Principles
and Practice of the Law of Evidence

10 ed (1921) at 265, quoted with approval by Kuper J in
Flange
Engineering Co v Elands Steel Mills (Pty) Ltd

1963 (2) SA 303 at 305G-H.




[8]
1984
(1) SA 619 (A) at 631D.




[9]
Sir
Johannes Wessels
Law
of Contract in South Africa

(vol 1, sec 1974) quoted with approval in
Rand
Rietfontein Estates Ltd v Cohn

[1937] AD 317 at 330-331.




[10]
2005
(3) SA 323 (SCA) at 340I and also see:
Van
Aswegen v Volkskas Bpk

1960 (3) SA 81 (T) at 85A and
Meskin
NO v Anglo-American Corporation of SA Ltd

1968 and Another (4) SA 793 (W) at 802A.




[11]
Compare
Conradie
v Rossouw

1919 AD 279.




[12]
Respondent’s
written submissions dated 18 June 2014, para 11.




[13]
Robert
Joseph Pothier,
A
Treatise on Obligations

(1802 EDN) para 92




[14]
Christie,
The
Law of Contract in South Africa
.
2006, 5 ed at 220.




[15]
See
Georgias
v Standard Chartered Finance (supra).