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IN THE HIGH COURT OF SOUTH AFRICA
(GAUTENG DIVISION, PRETORIA)

(1)     REPORTABLE: NO

(2)     OF INTEREST TO OTHERS JUDGES: NO

(3)     REVISED 

CASE NO 39127/2018

 

In the matter between:

MILILE MPAMBANISO                                                                               PLAINTIFF

and

JAMES DAVISON                                                                                         FIRST DEFENDANT

JUDGMENT

BASSON J

 

[1]            This is an action for monetary judgment where the plaintiff, Mr Milile Mpambaniso (“Mpambaniso”), claims payment of an amount of R3,354,996.59.

 

[2]            Mpambaniso’s claim is based on contract (an agreement). It is not in dispute that he concluded an agreement (the “agreement”), in terms whereof the counter party was mandated to invest R2,771,934.91 in its discretion on Mpambaniso’s behalf.  The terms of the agreement are not contentious.  What is in dispute, is the party with whom Mpambaniso concluded the agreement: Did he conclude the agreement with Mr Davison (“Davison” - a director of the second defendant) in his personal capacity or with Squirrel Benefit Administrators (Pty) Ltd – the second defendant (“SBA”)?  In his particulars of claim, Mpambaniso asserts a claim against Davison in his main claim and against SBA in the alternative.  

 

[3]            The alternative claim, however, became moot shortly after the commencement of the trial. In his evidence Mpambaniso expressly disavowed any reliance on his alternative claim against SBA. He explained that the alternative claim was introduced out of caution on the advice of his legal representatives, but that it is no longer his case that the agreement was concluded with SBA. At the commencement of his cross-examination he again confirmed that he no longer asserted (in the alternative) that the agreement was concluded with SBA and that he accepted that he cannot raise an objection should the defendants request the Court to dismiss his alternative claim with costs. The alternative claim was accordingly abandoned resulting in it no longer being an issue for adjudication.

 

[4]        As a result, only one issue remained for consideration, namely whether the agreement was concluded with Davison personally or with SBA (with Davidson acting in his capacity as a director of SBA).

 

Brief summary of the parties’ versions

 

[5]        Mpambaniso’s version was that he and Davison (in his personal capacity) entered into an oral agreement in terms of which Davison agreed to invest Mpambaniso’s funds at his discretion and to repay the investment on demand.

 

[6]            Davison’s version was that the aforesaid agreement was concluded, not between him in his personal capacity and Mpambaniso, but between Mpambaniso and SBA. Davison also alleged that the administration of Mpambaniso’s investment was at some stage transferred from SBA to Squirrel Trust Administrators (Pty) Ltd (“STA”) and that STA is thus liable for repayment of Mpambaniso’s investment.

 

[7]            I must point out at this junction that Mpambaniso made it clear in his evidence that he was not concerned with the innerworkings of SBA and STA. His case was that he had concluded an agreement with Davison and that Davison is therefore liable for repayment of his investment. Although evidence was led about the transfer of various investments (including that of Mpambaniso) administrated by SBA to STA, this is, on Mpambaniso’s version irrelevant to the question before this Court.

 

The onus

 

[8]            It is uncontentious that Mpambaniso bears the onus to prove on a balance of probabilities that the agreement was concluded with Davison and not with SBA.  The criteria of a balance of probabilities entails an inference drawn from the facts as explained by the court in Govan v Skidmore[1]:

 

‘. . .  in finding facts or making inferences in a civil case, it seems to me that one may, as Wigmore conveys on his work on evidence. . . , by balancing probabilities select a conclusion which seems to be the more natural, or plausible, conclusion from months several conceivable ones, even though that conclusion be not the only reasonable one.’

 

The conclusion of the agreement

 

[9]        It is common cause that the agreement was concluded before 29 January 2015.  In an email dated 29 January 2015, a prior discussion between Mpambaniso and Davison is recorded.  The context to the agreement is recorded in the plea.   Mpambaniso confirmed the correctness thereof in his evidence:

 

(i)          Mpambaniso acted as an attorney at a time when there was a practice in existence in terms of which the trial court would order a trust to be created for the sole benefit of successful minor claimants in Road Accident Fund (“RAF”) litigation in the Eastern Cape.

 

(ii)        The funds awarded to a successful minor claimant, the cost for administering the trust, as well as the costs of suite would be paid into the trust account of the attorney involved, who would then pay the funds, less the fees and legal costs into the bank account opened by the appointed trustees.

 

(iii)       The trustees would pass a resolution to invest the trust’s funds on an investment platform administered by SBA, and SBA would be mandated by the trustees to invest the money on the investment platform to be administered by SBA.

 

(iv)       Mpambaniso was given a 25% stakehold in SBA and he would instruct SBA to register trusts for the aforesaid purpose with the Master’s office and, as founder of these trusts, would nominate the specified trustees for the various trusts.

 

[10]     The services that SBA could offer were communicated to Mpambaniso in an email dated 4 December 2013.  They included services pertaining to the investment of monies.  In the plea it is recorded that at least four trusts were implemented during 2014.  Mpambaniso confirmed his involvement in all these trusts. This means that Mpambaniso knew that SBA was mandated by the trustees to invest the trusts’ money on an investment platform administered by SBA. Mpambaniso was also aware that investment mandates (in respect of the trusts) were given to SBA and not to Davison in his personal capacity.

 

[11]     On 20 November 2014, an amount of R2,762,934.91 that was seized by the National Prosecuting Authority in a case of fraud against Mpambaniso, was released to him.  Mpambaniso wanted to invest this money.  This gave rise to the agreement under scrutiny in these proceedings. Mpambaniso testified that in January 2015, Davison told him that he (Davison) had achieved success by investing funds on an investment platform called Caleo. (The parties and various documents in the record refer interchangeably to Caleo and BCI. They therefore appear to be one and the same.)

 

[12]        Mpambaniso testified that he requested Davison to invest the aforementioned amount on the same platform as the RAF trusts.  Davison agreed.  In an email from Mpambaniso to Davison on 1 February 2015, Mpambaniso recorded the following:

 

            ‘Hi James,

Please find proof of payment of R2.7m which I requested you to invest on my behalf. This money was paid to my attorneys trust account in turn I instructed them to transfer it to Stemela Lubbe, who are attending to some of my personal matters. In the meantime invest it at your discretion.

            Regards, Milile’

 

[13]        The investment amount was transferred from Stemela Lubbe Inc. into the bank account of SBA for onward transfer to Caleo for investment.  This was confirmed by Davison in an email sent from Davison’s SBA email account. Davison signed the email in his capacity as director of SBA. The email reads as follows:

 

            ‘Afternoon Amanda,

As per my discussion with Milile, please could you transfer the funds received for Milile Mpambaniso to the Squirrel Benefit Administrators Trust Account

            Standard Bank, Brooklyn,

            Account number 01-182-169-8

            The funds will be transferred to Caleo for further investment.

            Best regards

            James Davison (SA) Director

            Squirrel Benefit Administrators (Pty) Ltd’

 

[14]        Thereafter, Mpambaniso was intermittently provided with statements of his investment by SBA. On one occasion in 2016 Mpambaniso was furnished with a statement. Davison sent it to Mpambaniso from his SBA email account. The email expressly related to the BCI statement. The attachment was for “Squirrel Trust Administrators MM” and reflected the investor’s name on the statement as “Squirrel Trust Administrators MM”. In cross-examination Mpambaniso could not deny that the “MM” referred to him. So, as at 2016 Mpambaniso must have been aware that his investment was invested by SBA. It is, in my view, improbable that Mpambaniso could have been under the impression that his investment was done in Davison’s personal name. Yet, Mpambaniso did not raise any concerns regarding the fact that his investment was reflected as a SBA investment.

 

[15]        At times Mpambaniso made partial redemptions from the investment. On such occasions Mpambaniso would write to Davison with the details of the redemption whereafter the requested amount would be paid out.

 

[16]        On 19 February 2018, Mpambaniso requested a further redemption from his investment and instructed Davison to pay over an amount of R95,000.00 from his investment.  Davison responded that no payments could be made from STA bank accounts as STA was insolvent. 

 

 

[17]        Mpambaniso responded by sending an email to Davison as follows:

 

‘Are you saying my investment is STA money?’

 

[18]        Mpambaniso thereafter sought advice from Adv Stemela (“Stemela”) because Stemela was the one who facilitated his introduction to Davison.  Stemela, an advocate practicing at the Johannesburg Bar, explained that he advised Mpambaniso to “follow the money” after Mpambaniso had informed him that the money was originally paid into the bank account of SBA.  In light of this information Stemela advised Mpambaniso to approach SBA to determine if repayment of his investment could be obtained. Although Stimela made a good impression on the Court as a witness, he was unable to assist the Court in determining with whom the agreement was concluded as he was not present at the time. Stimela himself as well as a Ms Wilna Lubbe had also invested money with STA. His evidence was that a mandate was given to STA to invest on the BCI / Caleo platform.  

 

[19]        After he had obtained advice from Stimela, Mpambaniso then wrote an email to Davison and Jenkins (the SBA’s directors) and its auditor’s requesting payment of his investment.  The email dated 21 February 2018 is headed: “M MPAMBANISO INVESTMENT TO SQUIRREL BENEFIT ADMINSITRATORS”. In this email Mpambaniso formally recalled his investment. (I quote this email in paragraph [42] hereunder.)

 

[20]        SBA responded in a lengthy email to Mpambaniso on 24 February 2018 explaining how Mpambaniso’s investment was invested. The email inter alia informed Mpambaniso that his investment had been transferred to a sub-account of STA. In the email Davidson also informed Mpambaniso that he was furnished with draft financial statements on 30 June 2016 wherein it is clearly indicated that Mpambaniso’s funds were invested via STA.

 

[21]        Various WhatsApp messages were thereafter exchanged between Mpambaniso and Davison. In essence Mpambaniso took issue with Davison’s explanations:

 

‘James I read your lengthy email which does not begin to address the question which is, where is my investment? What is clear is that the money has perished. It is not in any of the bank accounts of STA. I am disappointed at you. I curse my 1st meeting with you. I trusted you implicitly. You always assured me that all investments were safe at Standard [Bank] without indicating to me that my investment perished. I did not suspect anything. I accepted your word without demure. At some point you will have to come clean.’

 

[22]        In a letter dated 28 February 2018, STA’s attorneys wrote to Mpambaniso, Stimela, Jenkins and Lubbe regarding the claim on “the loan account” of Mpambaniso. It is not necessary to repeat the contents of that letter. But, in the letter the attorneys recorded that an investment amount was paid to SBA to be invested.

 

[23]        Mpambaniso claims that Davison used his investment to repay certain trusts administrated by STA. The repayment was apparently necessary because Davison had wrongfully paid dividends to STA’s shareholders from the trusts’ funds.  Mpambaniso claimed that his investment was used to correct a payment wrongfully made by Davison.  He further claimed that he never gave Davison permission to utilise his funds to repay the trusts.  He further testified that he was not involved in the administration of or investment of trust funds that he referred to Davison.  Lastly, he testified that he was not aware of a “purported transfer” of his investment to STA.

 

[24]        On 24 May 2018, the attorneys on behalf of Mpambaniso wrote a letter to Davison. In this letter, for the first time, the allegation is made that Mpambaniso mandated Davison (personally) to invest on the BCI platform. A demand was then made that Davidson repay the investment amount.

 

[25]        The attorneys acting on behalf of Davison responded to the letter on 5 June 2016. In this letter it is specifically denied that Davison was mandated in his personal capacity to invest the funds on behalf of Mpambaniso. It is further stated that it was always the mutual intention that the investment would initially be advanced to SBA and thereafter to STA who would then invest it in the relevant company’s name with a dedicated sub-investment account linked to Mpambaniso.

 

[26]        In summary: Mpambaniso relied on the following in support of his case:

 

(i)          Firstly, the email written by him to Davison dated 1 February 2015 which reflects, according to him, that he requested Davison (personally) and not SBA to invest his funds.

 

(ii)        Davison’s admission in cross-examination that he never told Mpambaniso that he was acting on behalf of SBA.

 

(iii)       The fact that Davison did not present any evidence that he (Mpambaniso) was aware that Davison was acting in a representative capacity and that the agreement was actually concluded with SBA.

 

Evidence of Jenins

[27]        Kevin Jenkins (“Jenkins”), the other director at SBA, testified that he was not aware of any agreement between Mpambaniso and SBA and that he was not aware of any authority being given to Davison to enter into an agreement with Mpambaniso.  Jenkins also testified that SBA had never before invested funds for members of the public. Jenkins also believed that Davison had perpetrated a “scam” on Mpambaniso.

 

[28]        I do not intend dealing with the allegations of dishonesty against Davison as this is not before this Court.  The pleadings do not contain any allegations of dishonesty, fraud or even creative accounting. It is also not alleged in the pleadings that Davison acted negligently with Mpambaniso’s investments. These issues are not before this Court.

 

[29]        Jenkin’s evidence therefore added little to support the case of Mpambaniso. He confirmed that he was not present when the agreement was concluded and can accordingly not assist with the facts pertaining thereto. Further, as a witness Jenkins did not make a favourable impression on the Court.  He clearly had an axe to grind with Davison who was his former friend. His animosity towards Davison was palpable. Jenkins also testified that Davison was not mandated to conclude an agreement on behalf of SBA with Mpambaniso. This evidence also does little to advance the case of Mpambaniso as the lack of authority needs to be specifically pleaded to raise this as an issue, which was not done.[2]

 

[30]        Jenkins also could not explain why SBA’s 2015 financial statements record Mpambaniso as a creditor in respect of his investment. He was furthermore copied on the email of January 2015 and was thus fully aware of the investment administration services being provided to the trusts by SBA.

 

Concessions made by Davidson

[31]        Davison did make various concessions in his evidence. He, for example, conceded that Mpambaniso did not specifically have anything to do with the administration of the trusts and was not involved in the investment of trust funds.  He also admitted in cross-examination that Mpambaniso was never told that his investment was purportedly transferred to STA and admitted that he had processed redemptions of the investment on Mpambaniso’s instruction in the past. Davison also admitted that he never informed Mpambaniso that he was acting on behalf of SBA and simply stated that Mpambaniso must have known that he was.

 

[32]        The concessions regarding SBA and STA should, however, be seen in context. The only question before the Court is whether the agreement was concluded with Davidson in his personal capacity or with SBA (represented by Davison). What happened in the innerworkings of SBA and the question of whether or not the investments were transferred to STA, are not relevant as that concerns a party or parties who are not sought to be held liable by Mpambaniso.

 

[33]        Davison’s case before this Court was simple. He testified that the agreement was concluded between Mpambaniso and SBA and that he (Davidson) acted in his representative capacity when the agreement was concluded. He testified that Mpambaniso wanted his investment to be invested on the same basis as the trusts (already administered by SBA at that time).

 

[34]        Regarding STA, Davison briefly testified that the directors and shareholders of SBA were advised that for audit purposes it would be advisable to administer trust funds through a separate entity and that this advice resulted in the incorporation of STA.  Davison further testified that, pursuant to the advice and the incorporation of STA, the administration of Mpambaniso’s investment was transferred to STA in May 2015. As already pointed out, this evidence is not really relevant in the context of this case.

 

Broad submissions on behalf of the parties

[35]        On behalf of Mpambaniso, it was submitted that his evidence was consistent and credible, and, if regard is had to Davison’s concessions, Mpambaniso should succeed in his claim. It was also submitted that the evidence of Davison was contradictory and at times evasive, particularly if regard is had to the admissions during cross-examination, that Mpambaniso had not given him permission to do anything with his investment other than to invest it.

 

[36]        On behalf of Davison it was submitted that it was improbable that Mpambaniso would have mandated Davison in his personal capacity to administer his investment in light of the following facts:

 

(i)          SBA controlled by Davison and Jenkins had, at the time of the contested agreement, been mandated by various trusts to invest money on an investment platform administered by SBA. In other words, an investment structure was already in place at the time, in terms of whereof SBA, and not Davison personally, was the investment vehicle. Mpambaniso, through his involvement with the trusts, was intimately involved in this structure.  Under these circumstances it is therefore improbable that Mpambaniso and Davison would have bypassed the structures already in existence and conclude an agreement in terms whereof Davison, in his personal capacity, would be mandated to administer Mpambaniso’s investment.

 

(ii)        The email of 29 January 2015 (containing the instructions regarding the investment) was communicated on the letterhead of SBA to Mpambaniso by Davison in his capacity as a director of SBA and copied to his co-director (Jenkins). The email recorded an instruction to Mpambaniso’s attorney to transfer his funds to the SBA trust account for the purposes of being transferred from there to Caleo (a fund manager) for further investment.  It was submitted that there would have been no need for this process had Davison contracted in his personal capacity. Mpambaniso’s funds would either have been paid directly to Davison, and thereafter to Caleo, alternatively directly to Caleo.

 

(iii)       In Mpambaniso’s particulars of claim it is asserted that the agreement was concluded with Davison on or about 1 February 2015, with reference to his email of the same date.  It was submitted that the email must be interpreted in the context of what had already transpired, specifically the email of 29 January 2015, and the discussion that preceded it and that that the reference to “you” in that email has a reference to “Davison” in his capacity as representative of SBA.[3]  The email cannot, so it was submitted, be interpreted in isolation.

 

(iv)       SBA’s audited financial statements for the year ended 28 February 2015 record Mpambaniso as its creditor in respect of his investment.  Davison’s explanation in cross-examination that this could not and would not have been the case if SBA was merely used as a conduit, as asserted by Mpambaniso, was left unchallenged. These statements were made available to SBA’s shareholders, including Mpambaniso, who held a 25% shareholding.

 

(v)        Mpambaniso confirmed during cross-examination that, should he want to call up his investment, he will look to the party with whom he contracted.

 

(vi)       On 19 February 2018, in response to a request from Mpambaniso for a payment of R95,000.00 from his investment, Davison informed Mpambaniso as follows:

 

‘I cannot make any payments from any of the Squirrel Trust Administrators’ bank accounts as both the statutory auditor and the forensic auditor have indicated that STA is insolvent, and making any payments would be deemed to be trading recklessly.

 

This is the exactly same reason as why STA was not allowed to make the payment of the forensic auditors’ invoice and all the parties were required to pay their share.’

 

On the same day Mpambaniso responded with an email recording the following:

 

                        ‘Are you saying my investment is STA money?’

 

(vii)  The facts pertaining to the investment resorting in STA are, as already pointed out, irrelevant as a result of the second issue having become moot. What is relevant is that Mpambaniso asserts that he concluded the agreement with Davison personally and, that should he wish to call up his investment, he would look to Davison. On Mpambaniso’s evidence, this would therefore have caused him to demand the repayment of his investment from the party with whom he contracted, being Davison in his personal capacity. However, in total contradiction of his own evidence, Mpambaniso demanded payment of his investment from SBA, and not Davison, on 21 February 2018.  On behalf of Davidson it was submitted that Mpambaniso’s explanation in evidence for his conduct was that he forwarded the demand as a result of the urgency of the matter, is non-sensical and should be rejected for the following reason: Having been told that STA cannot pay him, he sent a demand for repayment of his investment to SBA with whom, according to him, he had no contract. To his knowledge he had no right of recourse against SBA.

 

(viii)    Mpambaniso’s demand to SBA for repayment of his investment, and not Davison, is explained in his heads of argument with reference to the advice received by him from Stemela to “follow the money”.  Why would Mpambaniso demand repayment of his investment from a party who, according to him, was not contractually liable to him. It was only on 24 March 2018 that Mpambaniso’s attorney wrote a letter in which it was asserted for the first time that the agreement was with Davison personally.  It was submitted that the inescapable inference is that Mpambaniso, having realised that he might not successfully recover his investment from SBA opted to amend the facts.

 

Evaluation of the facts

 

[37]        The dispute hinges on a very narrow point namely with whom was the agreement concluded. Mpambaniso, as pointed out, claims that he concluded an investment mandate with Davison and that he mandated Davison (in his personal capacity) to invest his money. It was not his evidence nor was it pleaded that Davidson acted negligently or fraudulently with his investment. In fact, it was Mpambaniso’s case that whatever happened with the investment or whatever happened in the entities used by Davison as investment vehicles (SBA and/or STA) was none of his concern because Davison and no one else is liable for repayment. It was also not pleaded that Davison did not have the necessary authority to conclude the agreement with Mpambaniso on behalf of SBA (although this was the evidence of Jenkins).

 

[38]        Considering the probabilities. I am not persuaded that Mpambaniso discharged the onus of proving that the contract was concluded with Davidson in his personal capacity and not with Davidson in his capacity as a representative of SBA.

 

[39]        In arriving at the aforementioned conclusion, I had regard to, inter alia, the following: Mpambaniso was not an ignorant investor as far as SBA is concerned. He had a 25% shareholding in SBA and, although he was not involved in the day to day running of the trusts, at the very least he knew that SBA was the investment vehicle that invested trust funds on certain platforms (such as Caleo / BCI). It is in my view, not probable that Mpambaniso would not have known that by paying his investment amount into the bank account of SBA, SBA would have been the entity– and not Davison personally – that would have invested the funds in the same way it was done with the trusts (with which Davison was intimately involved in).

 

[40]        The fact that the investment funds were paid into the account of SBA which had since its inception been the entity that administrated RAF trust funds, is therefore significant. Mpambaniso himself made it clear that he wanted his monies to be invested on the same platform as the RAF trusts – all of which he knew has always been administrated by SBA. There has never been a suggestion that Davidson personally administrated the funds on the investment platforms, and it is thus in my view improbable that Mpambaniso would not have intended SBA to be the other contracting party. Why would Mpambaniso pay over the funds to an entity – SBA – which he knew was the administrator of funds paid over to it, if the intention was that Davison in his personal capacity invest the funds. In other words, why did Mpambaniso not pay over the funds to Davison personally to invest it in his personal capacity on the same platforms as the RAF trust investments?

 

[41]        An important e-mail in this regard is the one of 29 January 2015 wherein Davidson, in his capacity a Director of SBA (a registered Fund Administrator authorised by the FSB in terms of section 13B of the Pension Fund Act registration number 24/758) wrote an email to a one Ms Amanda Strydom (of Stemele Lubbe Inc.) requesting that the funds received from Mpambaniso be transferred to the SBA Trust account. The email was copied not only to Mpambaniso but also to Jenkins. From this e-mail, it is apparent that Davidson dealt with the investment funds of Mpambaniso in his capacity as a director of SBA and not in his personal capacity.

 

[42]        It was common cause between the parties that it was a term of the agreement that the investment amount (or parts of it) would be repayable upon reasonable demand. Mpambaniso conceded in cross-examination that he will demand repayment of his investment from the party with whom he contracted. So, it then follows, on Mpambaniso’s construction that he would demand repayment from Davison and not from anyone else. But, if regard is had to the correspondence, Mpambaniso did not demand repayment from Davidson in his personal capacity, but from SBA/STA. In an email dated 22 February 2018 Mpambaniso wrote to Davidson and the auditors. This email followed upon an earlier e-mail from Davidson on 19 February 2018 in which he informed Mpambaniso that STA is insolvent and that no payments could be made. In Mpambaniso’s e-mail a few days later the following is recorded. The email is headed: “Re: INVESTMENT MADE TO SQUIRREL BENEFIT ADMINISTRATORS: MILILE MPAMBANISO”:

 

‘On 2^nd February 2015, an amount of R2 771 934-91 [“the investment”] was transferred to Squirrel on the mandate that it be invested and accepted on that instruction. Attached is the instruction correspondence with Mr Davidson [Directive”]

I now request your advices if the money is in Squirrel’s accounts [STA] or anywhere in the books a provision a provision made to pay over the investment now that the company is closing down. For its worth and without moving away from my request, I did request from the director of Squirrel the paying over of the investment.’

 

[43]        This email is instructive in that it refers in no uncertain terms to the fact that Mpambaniso (in his own words) made an investment with SBA (“Squirrel”); that the funds so invested was transferred to Squirrel to be invested; and that such instruction was made in correspondence to Davidson – in his capacity as director. Lastly, and importantly, bearing in mind Mpambaniso’s evidence that he would request his money from the person with whom one contracted with, Mpambaniso requested that the investment be paid over to him from Squirrel (presumably a reference to SBA). He concluded his email to say that he has already requested repayment from the directors of Squirrel. Nowhere in this e-mail did Mpambaniso raise the point that he had actually contracted with Davidson in his personal capacity.

 

[44]        Also, if regard is had to the financial statements of SBA for the year ending 28 February 2015 Mpambaniso’s investment was recorded therein. The same is reflected in the February 2016 financial statements. Mpambaniso was a 25% shareholder. It was not his evidence that he raised any concerns about the entries in the financial statements although he was vague about whether he has seen the financial statements. Although he conceded that he might have received the financial statements, it was his evidence that he did not read it. I find it highly improbable that a 25% shareholder would not peruse financial statements of an entity in which he had such a substantial shareholding. But, what is important is the fact that the investment is reflected in the books of SBA which would not have been the case if SBA was merely used as a conduit as alleged by Mpambaniso. Yet, Mpambaniso at no stage raised any concern over the manner in which his investment was reflected.

 

[45]        On 19 August 2016, Mpambaniso wrote an email to Davison (using Davison’s SBA e-mail address) requesting a statement of his investment. On the same date, Davison in his capacity as director of SBA confirmed that he had transferred R300,000.00 to Mpambaniso’s account. This flies in the face of Mpambaniso’s contention that he requested payments from the person with whom he had contracted.

 

[46]        Again and on 30 August 2016, Davidson in his capacity as director of SBA communicated with Mpambaniso regarding his investment. The investment report refers to the investment made as “Investor Name: Squirrel Trust Administrators: MM”. Mpambaniso could not deny that this (“MM”) was a reference to him and his investment. The investment is further reflected as an investment administrated by STA (and not SBA). Yet it was not the evidence of Mpambaniso that it raised red flags.

 

[47]        Lastly, and importantly, the first time that Mpambaniso raised the allegation that he had contracted with Davidson in his personal capacity was on 24 May 2018 in a letter from his attorneys (Borman Brink Attorneys) written after he had consulted with his attorneys. It was put to him in cross-examination, in the context of this letter of 24 May 2018, that he instructed this letter to be written after he realized what SBA’s financial position was and that he wanted to reverse engineer the contract to make Davidson the contracting party. Mpambaniso’s answer to this merely was that he wanted his money.

 

[48]        In light of the above, the claim against Davidson is dismissed with costs.

 

Second claim

 

[49]        Mpambaniso has abandoned his alternative claim against SBA.  That claim is likewise dismissed with costs.

 

Order

 

[50]        The following order is made:

 

(i)             Claim 1 is dismissed;

(ii)            Claim 2 is dismissed;

(iii)          The plaintiff is ordered to pay the costs in respect of both claim 1 and claim 2 (the alternative claim) such costs to include the costs pursuant to the employment of senior counsel.

 

 

 

 

           

                                    A.C. BASSON

JUDGE OF THE HIGH COURT

GAUTENG DIVISION OF THE HIGH COURT, PRETORIA

 

 

Delivered:  This judgment was prepared and authored by the Judge whose name is reflected and is handed down electronically by circulation to the Parties/their legal representatives by email and by uploading it to the electronic file of this matter on CaseLines.  The date for hand-down is deemed to be 13/12 2021.

 

 

Case number                                    : 39127/2018

 

Matter heard on                                : 26 to 29 October 2021

 

APPEARANCES:

FOR THE PLAINTIFF                     : ADV N G LOUW

INSTRUCTED BY                            : BORNMAN BRINK INC

 

FOR THE DEFENDANTS              : ADV B H SWART SC

INSTRUCTED BY                            : PIERRE MARAIS ATTORNEY

 

 

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