Court name
High Court Main Division
Case name
Rall v Professional Provident Society Insurance Company (Namibia) Ltd
Media neutral citation
[2015] NAHCMD 209
Judge
Schimming-Chase AJ













REPUBLIC
OF NAMIBIA


HIGH
COURT OF NAMIBIA MAIN DIVISION, WINDHOEK


JUDGMENT


Case
No: I
1153/2015


DATE:
09 SEPTEMBER 2015


In
the matter between:


CHARL
WILHELM
RALL................................................................................................PLAINTIFF


And


PROFESSIONAL
PROVIDENT SOCIETY


INSURANCE
COMPANY (NAMIBIA)
LTD
....................................................................EFENDANT


Neutral
citation:
Rall v Professional Provident
Society Insurance Company (Namibia) Ltd (I
1153-2015)
[2015] NAHCMD 209 (9 September 2015)


Coram:
Schimming-Chase AJ


Heard:
11 August 2015


Delivered:
9 September 2015


Flynote:
Practice – Judgments and Orders –
Summary Judgment – Opposition to – Requirements –
Defendant required to show and satisfy the court that he has a
bona
fide
defence to the claim –
Material facts upon which defences based must be disclosed with
sufficient particularity and completeness to enable the court to
decide whether
bona fide
defence disclosed – Not required to disclose all details as
would be the case in trial proceedings – Conversely, summary
judgment is an extra-ordinary and stringent remedy and should only be
granted if there is no doubt that the plaintiff has an unanswerable
case.


Costs
– Offer and Acceptance – distinction between an offer of
compromise and an unconditional tender, for purposes of prevention of
liability for costs discussed. 


Costs
– When granted in application for summary judgment – 
Defendant tendering a portion of the claim in affidavit resisting
summary judgment – Plaintiff indicating in heads of argument
that a triable issue made out on a portion of the plaintiff’s
claim. 


Summary:
Plaintiff sued the defendant for some N$3.2
million representing interest payments due and payable to the
defendant in respect of certain long-term insurance benefits that
were owed to and eventually paid by the defendant to the plaintiff. 
This included a claim for capital and interest outstanding in respect
of certain accident benefits which the defendant also accepted were
payable to the plaintiff.  Defendant made an offer to pay a
certain amount before proceedings were instituted in full and final
settlement of plaintiff’s claim.  Defendant also made a
tender in the opposing affidavit for an amount of N$1,532,600.18. 
The plaintiff indicated in its heads of argument (filed in terms of
Rule 71(5)) that it would only take judgment in the amount of
N$1,532,600.18 as tendered, and apply for summary judgment in the
amount of N$83,714.75.   The court found (applying the
legal principles distinguishing a tender from an offer of compromise)
the offer in full and final settlement was not an unconditional
settlement but an offer of compromise.  Apart from the letter
being without prejudice, it was apparent that the plaintiff would
have had to accept the amount “offered” when it was clear
that the plaintiff still had a portion on which he would sue. 
Summary judgment was refused in the amount of N$83,714.75 although
the defendant was sparse in the issue in its papers because it could
not be said that there was no doubt that the defendant had an
unanswerable case.


ORDER


1.
Summary judgment is granted in favour of
the plaintiff in the amount of N$1,532,600.18. 


2.
Summary judgment is refused in respect of
the balance of the plaintiff’s claim and the defendant is
granted leave to defend.


3.
Costs of the summary judgment application
are awarded in favour of the plaintiff, only up to and including the
date of 24 July 2015, such costs to include the costs of one
instructing and two instructed counsel.


4.
The costs subsequent to 24 July 2015 are
reserved for determination by the trial court. 


5.
The defendant shall file its plea within 10
days of this order being granted. 


6.
The matter is postponed to 8 October 2015
before Mr Justice Miller AJ for a case management conference.






JUDGMENT






SCHIMMING-CHASE,
AJ


[1]
This is an application for summary
judgment.


[2]
The plaintiff sues the defendant for
N$3.221,259.51, representing interest payments that he alleges are
due and payable to him by the defendant in respect of certain long
term insurance benefits that were owed to and eventually paid by the
defendant to the plaintiff.  Six separate claims are set out in
the particulars of claim of which five encompass interest payments. 
This summary judgment application is in respect of those five claims.


[3]
Claims one to four flow from a
judgment of this court (referred to below) relating to an earlier
dispute between the parties involving the defendant’s liability
to pay interest on the aforesaid benefits, and a subsequent dispute
between the parties concerning the allocation of payments, in
particular whether the initial payments made by the defendant to the
plaintiff were made in respect of capital or interest, and whether
the plaintiff had the right to unilaterally appropriate payments
towards interest instead of capital.


[4]
It is necessary to give a short
background on the common cause facts in this matter.


[5]
The plaintiff, an admitted legal
practitioner, concluded a written agreement of insurance with the
defendant, a registered long-term insurer. In terms of this
agreement, the plaintiff was insured in the event that he became
permanently disabled or incapacitated such that he would be unable to
continue with his profession.


[6]
The plaintiff sustained a brain
injury during a cycling accident in March 2009 which rendered him
permanently incapacitated.  During October 2010, the plaintiff
lodged a claim with the defendant for compensation in the form of a
disability lump sum payment, a permanent incapacity benefit and an
accident benefit.


[7]
On 11 February 2011, the defendant
rejected the plaintiff’s claim.  The plaintiff objected to
the rejection of his claim, and on 8 February 2012, the defendant
formally acknowledged full liability for payment, and undertook to
pay the plaintiff 100% benefits, effective 27 February 2011.


[8]
The
defendant however disputed its liability to pay interest on the
benefit amounts claimed by the plaintiff. This culminated in
litigation between the parties resulting in a judgment of Ueitele J
delivered on 22 August 2014,[1]
in terms of which the defendant was ordered to pay the plaintiff the
following in respect of interest:


8.1.     
interest at the rate of 20% per annum calculated from
28 February
2011 on an amount of N$8,332,929.00 or the portion of that amount
that remained outstanding from time to time subsequent to that date
and up to the date that the full capital amount of N$8,322,929.00 is
paid to the plaintiff;


8.2.     
interest at the rate of 20% per annum on all premiums repaid to the
plaintiff subsequent to 27 February 2011 from the date that the
defendant received the premium until the date on which the defendant
repaid the premiums to the plaintiff.  (This related to
disability premiums and permanent incapacity premiums);


8.3.     
mora interest
at the rate of 20% per annum on all the incapacity payments made to
the plaintiff, which are outstanding from time to time as from 27
February 2011 up to the date that the defendant paid them to the
plaintiff.


[9]
The interest liability of the
defendant as a result of this judgment accordingly has four
components, namely


9.1.     
a disability lump sum payment;


9.2.     
the repaid disability premiums as from 27 February 2011;


9.3.     
the repaid permanent incapacity premiums as from
27 February
2011; and


9.4.     
monthly incapacity payments paid late as from 27 February 2015. 


[10]
In its fifth claim, the plaintiff
sues the defendant for capital and interest outstanding in respect of
certain accident benefits which the defendant accepted were payable
to the plaintiff, and which it only paid as from July 2013.  The
capital and interest outstanding claimed is for the period February
2011 to July 2013 together with interest at the
mora
rate of 20% per annum. 


[11]
The particulars of claim further
allege there is a dispute between the parties regarding the
allocation of payments firstly to interest and then to capital in
respect of the lump sum disability benefit, the sums payable and
interest calculations in respect of the lump sum disability and
permanent incapacity benefits, the sums payable and interest
calculations in respect of premiums, and the sum payable (inclusive
of interest) and the interest rate applicable in respect of the
accident benefit. 


[12]
The main issue for determination
relates to the interest payable in terms of claims one to four, and
the capital and interest payable in respect of the accident benefits

(claim 5).


[13]
In its opposing affidavit, the
defendant confirmed the facts that led to the judgment of this court
referred to in paragraph [8] above, as well as thefour components of
its interest liability as a result of the judgment.  The
defendant also confirmed the existence of the accident benefit which
did not form part of the aforesaid litigation, but for which it also
applied the same rate of 20% per annum in respect of interest for all
payments that were paid late as from 27 February 2011.


[14]
The essence of the defendant’s
defence is that the parties differ in their calculation of the
interest payable in terms of the court order referred to above. 
The defendant alleged that subsequent to the court order, it
calculated its interest liability to the plaintiff, and according to
its calculations, the interest liability owing to the plaintiff
amounted to a total of N$1,964,631.09, calculated as follows:  


14.1.  
in respect of the disability lump sum payment, the capital amount of
N$8,332,929.00 was paid in full on 8 March 2012.  Interest was
calculated from 27 February to 8 March 2012 at 20% per annum,
resulting in a total of N$1,716,811.67 in respect of interest for the
disability lump sum benefit; 


14.2.  
interest at the rate of 20% per annum was calculated on all permanent
incapacity monthly payments due to the plaintiff which were paid
subsequent to the due date for the relevant period.  The
interest due was calculated in the amount of N$216,760.87; 


14.3.  
in respect of the accident benefit, the total interest due “on
the respective 21 payments made subsequent to the due date and for
the period February 2011 to October 2012 amounts to a total of
N$17,747.60”; 


14.4   
in respect of both disability and permanent incapacity premiums
deducted and subsequently repaid to the plaintiff: 


 


14.4.1
the total interest due by the defendant to the plaintiff in respect
of 14 disability premiums for the period from February 2011 to March
2012 was calculated as N$1,202.78; 


14.4.2
the total interest due by the defendant to the plaintiff in respect
of 11 incapacity premiums for the period February 2011 to December
2011 was calculated at N$12,108.17.  


[15]
In support of these calculations,
the defendant provided annexures.  The defendant further averred
that all interest calculations were made using the capital amounts
due from time to time multiplied by 20% per annum divided by 365, and
finally multiplying same with the number of days that the respective
capital payments were made after the due date.  The calculations
were made for simple interest.


[16]
The defendant further alleged that
of the aforesaid interest liability (N$1,964,631.09), which
constituted its entire indebtedness to the plaintiff, the defendant
had already made two payments towards interest to the plaintiff,
namely the amounts of N$77,819.08 on 8 March 2012 and N$354,211.83 on

5 November 2012.  The plaintiff received these two amounts
but did not want to accept them as interest payments, as a result of
which he offered to pay the amounts back to the defendant. 
However to date, the plaintiff has not repaid these amounts to the
defendant.  As a result, these amounts needed to be deducted
from the defendant’s total interest liability, resulting in an
indebtedness of N$1,532,600.18.


[17]
Apart from the above two payments,
the defendant alleged that all payments made by it to the plaintiff
were expressly made towards capital. 


[18]
The defendant stated that the
plaintiff had informed it that all payments would first be applied to
reduce interest and thereafter to reduce capital.  In this
regard, the defendant stated that at all relevant times (and until
the above judgment was given), it denied its liability to pay any
interest and made it clear to the plaintiff that all payments (except
the two payments referred to above) were made towards capital. 
The defendant submitted that the plaintiff could not apply the
payments made to interest first, and that it was accordingly not for
him to unilaterally decide where to apply payments that were
specifically made by it towards capital.


[19]
The defendant also stated that on 17
October 2014 the amount of N$1,657,254.65 was offered to the
plaintiff in writing in settlement of its entire interest liability. 
The plaintiff refused to accept the aforesaid payment and proceeded
to institute legal action instead.


[20]
From the plaintiff’s response
to the defendant’s offer of 17 October 2014 (which I deal with
in more detail below), the defendant alleged that the only issue in
dispute between the parties was whether the payments made by the
defendant to the plaintiff should first have been applied towards
interest and then towards capital, and whether it had the right to
determine how payments were to be allocated.


[21]
The defendant repeated its offer to
pay the amount of N$1,532,600.18, which was tendered in the affidavit
 resisting summary judgment and submitted that the plaintiff had
no case for the remainder of the relief sought.  It also
submitted that the plaintiff was not entitled to costs for the
summary judgment application as the offer for the above amount was
unconditionally made prior to the proceedings being instituted,
namely on 17 October 2014 and because the plaintiff was apprised of
the defendant’s
bona fide
defence before it launched the summary judgment application.  In
the result, it was further submitted, the application for summary
judgment amounted to an abuse of court process, warranting a special
costs order against the plaintiff as well as an order staying the
main proceedings pending payment of such costs as contemplated by
rule 60(11)(b).


[22]
At the hearing of the application
for summary judgment Mr Frank SC, assisted by Mr Dicks, appearing for
the plaintiff, submitted that the plaintiff would only seek summary
judgment in the amount of N$1,532,618.00 (as tendered in the opposing
affidavit) as well as the amount of N$83,714.75 in respect of the
accident benefit capital and interest claim for which Mr Frank
submitted, the defendant did not raise a triable defence on its
papers.  Mr Frank conceded that the defendant had raised a
bona
fide
defence on the balance of the
amount claimed.


[23]
As regards the question of costs, Mr
Frank submitted that the plaintiff is still entitled to his costs in
the summary judgment application in spite of the letter dated 17
October 2014 relied on by the defendant, because the offer contained
therein was not a tender to pay, but an offer of compromise.


[24]
Mr Tötemeyer SC, appearing for
the defendant together with Ms van der Westhuizen correctly submitted
that due to the acceptance by the plaintiff of the amount tendered in
the opposing affidavit, and considering the total claim of the
plaintiff for some N$3.2 million, only two issues remain in
contention between the parties.  They are: 


(a)
whether summary judgment should be granted
in respect of the accident benefit in the amount of N$83,714.75; 
and


(b)
the issue of costs.


[25]
The amount of N$1,532,600 having
already been tendered by the defendant, I firstly deal with whether
summary judgment should be granted on the amount of N$83,714.75,
after which I deal with the question of costs.


[26]
Mr Frank submitted that the
defendant has failed to put forward any meaningful defence to this
claim in its opposing affidavit.  His argument was based on the
following:  The plaintiff’s claim is for capital amounts
due as well as interest outstanding with reference to certain
annexures to the particulars of claim which contain a detailed list
including calculations on capital and interest. From the annexures,
it is apparent that certain capital amounts were outstanding
according to the plaintiff from February 2011 to July 2013.  In
its opposing papers, the defendant tendered an amount of N$17,747.60
as interest on the outstanding accident benefit. This was included in
the amount tendered (N$1,532,600.18) comprising “21 payments”
made subsequent to due dates. When comparing the annexures to the
particulars of claim to the annexure to the opposing affidavit, the
parties are
ad idem
that all payments were due as at February 2011.  However, the
annexures to the particulars of claim deal with capital amounts
outstanding up to July 2013 in respect of the accident benefit,
whereas the annexure to the opposing affidavit only deals with
capital amounts paid by the defendant up until October 2012. 
There is no explanation by the defendant for its failure to pay or
include in its calculations the outstanding capital due from November
2012 to July 2013, which amounts to N$83,714.75. 


[27]
Mr Tötemeyer argued that a
triable issue is indeed disclosed by the defendant in respect of the
capital amounts claimed.  He submitted that it was at all
material times clear, and the defendant had specifically averred,
that all capital amounts due to the plaintiff had been settled, even
before the plaintiff launched the proceedings giving rise to the
judgment of Ueitele J.  He further submitted that a
consideration of the defendant’s opposing affidavit and the
relevant annexure evidencing the defendant’s calculations in
respect of the accident benefit, that what is dealt with therein is
the late payments in respect of the accident benefit for which the
defendant concedes it is liable for interest.  On the
defendant’s version, nothing was due (as capital) for November
and December 2012, as claimed by the plaintiff, hence the insertion
of a zero amount in its annexure for the relevant period. 
Furthermore, on the plaintiff’s own version, accident benefits
were paid by the defendant in July 2013, yet a capital amount plus
interest is claimed for the month of July 2013 in the particulars of
claim in spite of that payment.  On this basis it was argued
that at least 3 of the capital amounts said to be owed in respect of
the accident benefit may not be owed, and as a result, summary
judgment should be refused on that basis. 


[28]
In
terms of rule 60(5)(b), a defendant opposing a summary judgment
application must disclose fully the nature and the grounds of its
defence and the material facts relied on.  Of crucial importance
is the comprehensive disclosure of the material facts upon which the
defence is based with sufficient particularity and completeness to
enable a court to decide whether a
bona
fide

defence is disclosed.[2] 
This is particularly so as the evaluation of the defendant’s
opposing affidavit frequently entails not a consideration of what the
defendant has said, but of what he did not say.[3] 


[29]
Similarly,
because summary judgment is such an extra ordinary remedy, it should
only be granted if there is no doubt that the plaintiff has an
unanswerable case.  This, at least, is the approach taken in our
jurisdiction to applications for summary judgment.[4] 


[30]
The plaintiff’s claim set out
in the particulars of claim in respect of the accident benefit is as
follows:


19.1   
Defendant accepted that an accident benefit was payable to the
plaintiff as from the effective date and has been paying such benefit
as from July 2013.  A capital amount is outstanding in the
period February 2011 to July 2013, together with interest from 20
February 2011 to date at the
mora rate
of 20% per annum.


20.
In respect of the accident benefit the plaintiff is therefore
entitled to the sum of N$349,877.87 as per annexure “M”
(compound interest), alternatively N$335,330.66 as per annexure “N”
(simple interest) hereto, together with interest from 20 February
2015 to date of payment at the
mora
rate of 20% per annum.


21.
The defendant, despite demand, fails and/or refuses to pay the above
sum to the plaintiff.” 


[31]
Annexures “M” and “N”
contain the calculations in support of the amount of interest and
capital claimed by the plaintiff.  The annexures also contain a
column indicating the capital amounts “due” between
February 2011 and July 2013.  There is also an indication of a
substantial capital payment by the defendant during July 2013.


[32]
The defendant’s defences are
described as follows:


8.5     
In addition to the aforesaid, there is also an accident benefit which
did not form part of the aforesaid litigation, but for which the
defendant applies the same rate of 20% per annum in respect of
interest for all accident benefit payments that were paid late as
from 27 February 2011.  This, together with the four components
referred to in paragraph 8.4 above, constitute the five components of
interest due by the defendant to the plaintiff as set out below and
subject thereto.” 


and
further:


8.6.2  
Furthermore, in respect of the accident benefit, as is set out in
annexure “B” hereto, the total interest due, at the rate
of 20% per annum on the respective 21 payments made subsequent to the
due date and for the period from February 2011 to October 2012
amounts to a total of N$17,747.60.
” 


[33]
It is apparent from the plaintiff’s
particulars of claim that the accident benefit claimed by him
includes a capital amount which he alleges is outstanding for the
period February 2011 to July 2013 together with interest from 2011 to
date at the
mora
rate of 20% per annum.  As I understand this claim, according to
the plaintiff, the particular capital amount was outstanding up until
July 2013, after which payment was made by the defendant.  The
defendant does not dispute that the capital amounts are payable, nor
does it dispute the timeframe within which the capital amounts were
payable.  All it says however is that in respect of the accident
benefit the total interest due at the rate of 20% per annum “on
the respective 21 payments made subsequent to the date and for the
period from February 2011 to October 2012” amounts to
N$17,747.60.


[34]
The opposing affidavit is silent on
the period between November 2012 and July 2013.  There is no
allegation that these capital payments are not due, only a general
allegation that all capital had been paid.  There is also no
clear allegation that the capital amount paid in July 2013 formed
part of the payments owed between November 2012 and July 2013. 
It would have behoved the defendant to at the very least have set out
the reasons why it calculates outstanding capital as at October 2012
and why no capital amounts are payable post October 2012 to July
2013.


[35]
I hold the view that it is not
sufficient to argue that certain amounts should not be included when
there are no allegations in the papers as to why they should not be
included. At the same time, a substantial capital payment appears to
have been made by the defendant during July 2013 and it is not clear
for which period these payments were or what parts of the outstanding
amounts they covered. In the result, I cannot say that I have no
doubt that the defendant has an unanswerable case on this aspect.


[36]
Considering the stringent remedy of
summary judgment, I find that the defendant has, by the skin of its
teeth, made out a triable issue in relation to the N$83,714.75 and
summary judgment is accordingly refused.


[37]
This now brings me to the question
of costs. Mr  Tötemeyer submitted that the plaintiff should
not be awarded any costs because the letter dated 17 October 2014
contained an unconditional offer by the defendant to pay its
liability interest in full, but the plaintiff refused such an offer.
Furthermore, the plaintiff knew (irrespective of whether he agreed
with the veracity of the defence) that  the defendant would rely
on a defence that would entitle it to leave to defend in respect of
the balance of the claim, yet the plaintiff proceeded to apply for
summary judgment.


[38]
In the alternative, and should the
court find that the letter dated
17 October 2014 did not contain
an unconditional offer warranting a refusal of costs from that date,
it could not be disputed that such tender was made on 24 July 2015 in
the defendant’s opposing affidavit. In the result, the
defendant should not be entitled to costs post 24 July 2015 and
instead, the defendant should be awarded costs subsequent to this
date for its opposition to the application.


[39]
I
was also reminded that as the heads of argument had been delivered on
the same day by both parties, the defendant had not had sight of the
plaintiff’s heads of argument before filing its own, and was
not aware that the balance would be conceded until that date. 
It was pointed out that a substantial portion of the defendant’s
heads of argument was devoted to the issue of appropriation of
interest and capital, which as a result of the defendant’s
concession has become academic.


[40]
To
determine whether the correspondence of 17 October 2014 is an offer
of compromise or an unconditional tender, the terms of the
correspondence needs to be analysed.  The exercise of doing so
does not necessarily make the distinction easy to discern.  As
stated above, the plaintiff’s stance is that this letter
contained an offer of compromise and not an unconditional tender, and
that the effect of a valid tender to prevent liability for costs is
that the plaintiff must know that he can get the money and that the
defendant is willing to pay.  Reliance was placed on the matter
of
B
& R Investments (Pty) Ltd v Laubsher[5]

where the following was succinctly stated:


At
common law there can be no doubt that a mere offer to pay is not a
tender sufficient to protect a debtor from the costs of litigation. 
Apart from exceptional cases (…) the debtor must offer payment
‘met open beurs en klinkende munt’ and must tender money
in kind.
[6]


Reliance
was also placed on the distinction between tenders and offers of
compromise as dealt with succinctly in the case of
Kei
Brick & Tile Co (Pty) Ltd v AM Construction[7],

where Froneman J set out the distinction between tenders and offers
of compromise utilising the ordinary accepted principles relating to
offer and acceptance as follows:[8] 


In
general, payment (or performance) of a debt can only be effected by
agreement between the parties. (See Saambou-Nasionale Bouvereniging v
Friedman 1979 (3) SA 978 (A) at 993A-C; Italtile Products (Pty) Ltd v
Touch of Class 1982 (1) SA 288 (O) at 292H-293F.) Payment is
therefore not a unilateral act by the debtor which can be imposed by
him on the creditor. If the debtor's offer of payment corresponds to
the exact terms and extent of the debt and is accepted by the
creditor, the debt is extinguished and the result is full payment of
the debt. If the creditor does not accept such a proper offer of
payment, he lapses into mora, with all its attendant consequences.


Where
the debtor's offer of payment does not correspond fully to the exact
terms and extent of the alleged debt owed to the creditor, the
creditor is entitled to reject it and insist on proper payment. No
question of
mora creditoris
comes into play at all. If, however, the creditor accepts such an
offer of payment, it would result in the whole debt being
extinguished.   The result of this would then be
categorized as a compromise. In line with general principles relating
to offer and acceptance, partial acceptance should be impermissible
and would in effect amount to a rejection of the offer, which may, in
turn, be construed as a counter-offer by the creditor to be accepted
or rejected again by the debtor. Unless, however, there is agreement
between the parties, there can be no valid payment of the alleged
debt or part thereof. (See De Wet and Van Wyk (op cit at 264-5) and
cf Van Breukelen en 'n Ander v Van Breukelen 1966 (2) SA 285 (A) at
290G-H; Tractor & Excavator Spares (Pty) Ltd v Lucas J Botha
(Pty) Ltd 1966 (2) SA 740 (T).)


Where
an offer of payment is made which does not correspond exactly with
the terms and extent of the alleged debt, the reason or motive for
the offer may either be that the debtor denies liability completely,
but wishes to dispose of the matter nevertheless, or that the debtor
admits partial liability, but disputes the correctness of the total
amount alleged to be owing. If, in the latter case, the offer of
payment is in the amount which the debtor considers is due to the
creditor, it will invariably be intended as payment of what the
debtor considers to be the extent of his liability or, in other
words, as an admission of partial liability. But that fact in itself
cannot be decisive of the enquiry whether an offer of payment in
terms less than the original alleged debt is intended to cover the
whole of the original debt or not. As stated by Didcott J in Andy's
Electrical v Laurie Sykes (Pty) Ltd (supra at 344B-D):


'Bluntly,
and in my respectful opinion too simplistically, these (cases) have
distinguished offers of compromise from payments of admitted debts,
as if the one sort of transaction necessarily excluded the other.
Such decisions are apt to be misunderstood unless one is careful, as
Prof Zeffertt was, to treat the payments of acknowledged debts to
which they referred as mere payments, unaccompanied by offers of
compromise. The real dichotomy is then evident between an offer to
settle the whole claim by the payment of a particular amount, for
which liability may or may not simultaneously be conceded, and the
payment of a sum admittedly due on the footing that the rest of the
claim is not covered and remains in issue.'


Seen
from this perspective, the proper enquiry is whether the debtor's
offer of payment can objectively be seen to cover the whole debt
allegedly owed to the creditor or not, and whether it was accepted by
the creditor as such. I may add that in my view, where an offer of
payment is made by a debtor in an amount less than the debt he
allegedly owes the creditor and it appears that the debtor considers
the offer of payment to represent the extent of his liability to the
creditor, it almost invariably implies that his offer of payment is
in respect of his total liability to the creditor and that he does
not intend paying anything more. (Compare Tractor & Excavator
Spares (Pty) Ltd v Lucas J Botha Ltd (supra at 743A).)”


[41]
It
is also well established that when an offer is made “without
prejudice” it indicates an offer to compromise and not an
unconditional offer.  The learned authors Herbstein and Van
Winsen summarise the position as follows:[9]


The
difference between an unconditional offer and an offer made without
prejudice is that an unconditional offer is regarded as being made
with admission of liability in whole or in part, whereas an offer
without prejudice is made without admission of liability and on
condition that it is accepted in full and final settlement of the
claim.  When an offer of partial settlement is unconditional,
the defendant may accept the offer and pursue the claim for the
balance.  When the offer is made without prejudice, acceptance
of the offer puts an end to the matter.”


[42]
In light of the above authorities,
Mr Frank submitted that 


44.1.  
the letter indicates that it is an offer with reference to certain
calculations; 


44.2.  
it refers to the defendant’s “proposed settlement
offer”; 


44.3.  
it states that “in summary the offer will be ….; 
and


44.4.  
it seeks a response and does not indicate an unconditional tender to
pay “met open beurs and klinkende munt”.


44.5   
it specifically states that the offer “is made entirely without
prejudice and we reserve all our rights in terms thereto.


[43]
Having
considered the authorities and the letter, I find myself in agreement
with Mr Frank’s submissions that the letter was an offer of
compromise and not an unconditional tender.  The terms of the
letter set out above make it apparent that there is a partial
admission of liability and that interest is due.  But apart from
that, it is also apparent that acceptance of that calculation would
be in “full and final settlement” as contained in the
aforesaid correspondence.  The fact that it is without prejudice
together with a formal reservation of rights, is an important
factor.  The established principle that where an offer is not
clear, it is construed
contra
proferentem

and against the debtor was also correctly argued on behalf of the
plaintiff.  Christie states the position as follows:[10]


Debtors
and their legal advisors of course have it in their power to make it
crystal clear whether the cheque is sent as an integral part of an
offer of compromise and is to be returned if the offer is not
accepted, or whether it may be cashed without committing the creditor
as it is intended merely to reduce the amount in issue (accompanied,
as often as not, by the expressed or unexpressed hope that the
creditor will then let the matter drop).  The cases mostly
result from the failure of debtors to make their intentions clear,
and a debtor who fails to do so may find his letter construed
contra
proferentem
.”


[44]
In light of the foregoing I find
that whilst the letter of 17 October 2014 did not contain a tender as
alleged by the defendant, the opposing affidavit of 24 July 2015 did,
and the plaintiff had ample time before the delivery of heads of
argument to inform the defendant of its stance.  I am also
mindful of the fact that the plaintiff, on his own version, knew of a
dispute between the parties regarding the allocation of payments
firstly to interest and then to capital in respect of the first four
components of the defendant’s interest claim.  This is set
out in the particulars of claim.  I also agree with the
submissions of Mr Tötemeyer to the effect that a substantial
portion of the defendant’s heads of argument was devoted to the
apportionment argument.  I hold the view that a “costs
curtailing” approach to this matter would have been for the
tender in the affidavit to be accepted, the defendant informed that
leave to defend would be granted for a portion of the balance, and
summary judgment applied for in respect of the N$83,214.75. 


[45]
However, I decline to hold the
plaintiff liable for costs at this stage.  As this is a summary
judgment application, and the issues raised by the defendant will be
ventilated at the trial.  In the result I make the following
order:


1.
Summary judgment is granted in favour of
the plaintiff in the amount of N$1,532,600.18. 


2.
Summary judgment is refused in respect of
the balance of the plaintiff’s claim and the defendant is
granted leave to defend.


3.
Costs of the summary judgment application
are awarded in favour of the plaintiff, only up to and including the
date of 24 July 2015, such costs to include the costs of one
instructing and two instructed counsel.


4.
The costs subsequent to 24 July 2015 are
reserved for determination by the trial court.


5.
The defendant shall file its plea within 10
days of this order being granted.


6.
The matter is postponed to 8 October 2015
before Mr Justice Miller AJ for a case management conference.


SCHIMMING-CHASE


Acting
Judge


APPEARANCES



PLAINTIFF: Mr
Frank SC


(with
him Mr Dicks)


Instructed
by Du Pisani Legal Practitioners


DEFENDANT:
Mr Tötemeyer SC


(with
him Ms van der Westhuizen)


Instructed
by Engling, Stritter & Partners



[1]
Rall
v Professional Provident Society Insurance Company (Namibia) Ltd

(A 224/2013) [2014] NACHNAD 249 (22 August 2014).




[2]
Di
Savino v Nedbank Namibia Limited

2012(2) NR 507 SC at paras 23-31




[3]
Van Niekerk, Geyer, Mundell-Summary Judgment - A Practical Guide
Service Issue 9, March 2010 at para 9.5.2.;
Kassim
Brothers (PvT) v Kassim

1964(1) SA 651 (SC) at 653 B. 




[4]
Mauno
Haindongo t/a Onawa Wholesalers v African Experience (Pty) Ltd

2006(1) NR 56 at 59E-60F.




[5]
1951 (2) SA 567 (T) at 570F-G




[6]
Loosely translated ‘with open wallet and hard




[7]
1996 (1) SA 150 (ECD) at 159B–160F




[8]
At 159B-160F.




[9]
above
at 617 fn 10.




[10]
Christies’s
The
Law of Contract in South Africa

6
th
ed at 477