IN THE HIGH COURT OF SOUTH AFRICA
(TRANSVAAL PROVINCIAL DIVISION)
Case No: A 1044/05
Date heard: 30/04/2007
Date of judgment: 17/08/2007
UNREPORTABLE
In the matter between:
S. L. Sello
APPELLANT
and
W. R. Nasson
RESPONDENT

JUDGMENT
DU PLESSIS J:
Towards the end of 1998 the appellant (defendant in the court a quo)
bought a Golf motorcar in terms of an instalment sale agreement that he had
concluded with Wesbank. On 16 June 1999 the appellant and the respondent
(plaintiff) entered into a "use agreement" in terms whereof the respondent took
possession of the motorcar and undertook to pay to Wesbank the instalments
due under the instalment sale agreement.

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After the respondent (plaintiff) had paid R48 211,88, in October 2002, the
appellant (defendant) took repossession of the car. Alleging that the appellant
had repudiated their agreement and the he had accepted the repudiation, the
respondent sued the appellant for repayment of the R48 211,88. The
magistrate's court at Cullinan granted judgment in favour of the respondent for
the amount. This is an appeal against that order. I shall refer to the appellant
and the respondent respectively as the defendant and the plaintiff.
The written user agreement provided in clause 9 thereof that, after he had
paid all the instalments in respect of the car, the plaintiff was to restore
possession thereof to the defendant. In the magistrate's court the plaintiff sought
rectification of the written agreement by deleting clause 9 thereof and by inserting
in its stead a clause that reads as follows:
"Once all payments due to the Bank have been paid by the User (plaintiff)
to the Bank, the Owner (defendant) will transfer ownership of the vehicle
to the User."
The magistrate's court granted an order so rectifying the user agreement.
Against that order there is no appeal and I proceed on the footing that the
agreement has been rectified and reads as set out above.
The facts relating to the defendant's alleged repudiation of the user
agreement are to a large extent common cause and I briefly set them out. In
June 2000 the plaintiff failed to pay the required instalment of some R 1400 to

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Wesbank. In the following two months, however, he rectified the position by
paying 1 % instalment in each of these months. After that the plaintiff, on several
occasions, made late payments but he did not fail to pay until June 2002 when
he again missed an instalment. The plaintiff consulted an employee of the bank
and told her that he was at that stage having difficulty to make the required
payments. She told him that, as long as he made some payments in order to
show his commitment, Wesbank would not take action. Accordingly, while
paying the full instalment in July 2002, in August 2002 he paid only R250 and in
September 2002 he paid only R700. At the beginning of October 2002 he
regularly paid the full instalment again.
When the contract was entered into in June 1999 the plaintiff worked and
lived in the vicinity of Witbank. He furnished the defendant with his contact
details, including his cellular telephone number. The parties had contact with
each other. In the course of 2001 the plaintiff started with a new employer and
he relocated to Mandini, KwaZulu-Natal. The plaintiff testified that he gave to the
defendant his new contact details while the defendant denies that. Although in
general she preferred the testimony of the plaintiff to that of the defendant, the
learned magistrate held that the plaintiff did not furnish the defendant with his
contact details when he relocated to KwaZulu-Natal. I am not convinced that this
finding by the learned magistrate was entirely correct, but as this aspect was not
fully argued before us, I proceed on the assumption that the plaintiff did not give
his contact details to the defendant when he relocated.

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In about June 2002 Wesbank contacted the defendant and told him, so he
said, that the instalments were about three months in arrears and that his
account was not conducted satisfactorily. In view of the facts that I have
summarised, I cannot understand how Wesbank could have told the defendant
that the account was about three months in arrears. It must be accepted,
however, that the bank told the defendant that the account was not conducted
satisfactorily. According to the defendant, the bank also sought repossession of
the car.
Being unable to contact the plaintiff, the defendant went to the South
African Police Services (SAPS) and laid a charge of theft of the car against the
plaintiff. In his statement to the police, the defendant gave the impression that,
since the user agreement had been entered into, the plaintiff had just
disappeared. That, on the defendant's own version, was incorrect as it was
common cause that the parties had had contact on several occasions. The
statement further conveyed that the plaintiff had made regular payments until
about April 2002 and, incorrectly, that he had then stopped paying. It will be
recalled that, since April 2002, the plaintiff did not pay in June 2002 but paid the
full instalment in July 2002. In August he paid only R250.
Acting on the defendant's charge against the plaintiff, the SAPS on 14
October 2002 in Mandini arrested the plaintiff on a charge of theft. He was

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detained, but the charge against him was later withdrawn. The police took
possession of the car and gave it to the defendant who remained in possession
thereof.
It is the plaintiffs case, and the trial court held, that by repossessing the
car with the help of the police, the defendant repudiated the agreement. It is not
in issue that, if the defendant had repudiated the agreement, the plaintiff had duly
accepted the repudiation, thereby cancelling the agreement. The defendant
contends, however, that he did not repudiate the agreement.
In terms of the agreement the plaintiff was entitled to possession of the car
and, once he had paid all the instalments, to transfer of ownership thereof.
Clause 10 of the agreement provides that if the plaintiff breached the agreement,
the defendant would be entitled "without notice to cancel" the agreement and to
take repossession of the car. There is no other term in the agreement entitling
the defendant to repossess the car. It follows that, unless and until the defendant
had duly cancelled the agreement, he was not entitled to repossess the car.
The defendant did not plead that he had cancelled the agreement. Yet, he
had the car removed from the plaintiff's possession and he took and retained
possession thereof. He did not tender return of the car to the plaintiff. In so
doing, the defendant, seen objectively, exhibited a deliberate and unequivocal
intention no longer to be bound to the agreement, thus repudiating it (Highveld 7

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Properties (Pty) Ltd and Others v Bailes 1999 (4) SA 1307 (SCA) at 1315B).
It follows that when the plaintiff accepted the defendant's repudiation, the
agreement was cancelled.
As a result of the cancellation of the contract, each party had to return to
the other whatever he had received in terms of the contract. It is common cause
that the defendant already is in possession of the car. Because the contract has
been cancelled, he is obliged to repay to the plaintiff the amount that he had
received in terms thereof which amount the parties agreed is R48 211,88. It
stands to reason that the defendant cannot retain both the car and the money. In
this regard it must be borne in mind that that agreement had been rectified and in
terms of the rectified agreement the plaintiff did not pay for the mere use of the
car.
The defendant pleaded that, since the plaintiff had breached the contract
prior to the defendant's repudiation, the plaintiffs allegation that he had accepted
the repudiation was "irrelevant in law". This contention also underlies one of the
defendant's grounds of appeal. Although Mr Potgieter spent little time on this
aspect in argument, I understood him to submit that, once a party is in breach of
a contract, he cannot, while so in breach, cancel the contract based on the other
party's repudiation thereof. As authority for this submission Mr Potgieter referred
us to Datacolor International (Pty) Ltd v Intamarket (Pty) Ltd 2001 (2) SA 284
(SCA) at 302E where Nienaber JA said: "One party, having repudiated a

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contract, cannot retroactively nullify it as a potential cause of action by taking
advantage of the opposite party's later breach and cancelling the contract before
the opposite party thought of doing so." This dictum is not authority for the
proposition that counsel put forward. What the learned judge of appeal was
saying is that a party who has breached a contract cannot nullify that breach by
subsequently cancelling the contract based on the opposite party's repudiation.
Put differently, even if a party who has breached a contract subsequently cancels
the contract based on the opposite party's breach, the first breach remains
exactly that with all its consequences. It could thus happen, the learned judge of
appeal pointed out later, that both parties lawfully cancel a contract based on
each other's breach. That did not happen in this case, as the defendant did not
purport to cancel the contract but simply acted contrary to its terms by taking and
retaining possession of the car. I might add that, even if the defendant had
cancelled the contract based on the plaintiffs breach, the result in this particular
case would have remained the same: the contract would have come to an end
and each party would have had to restore whatever he had received in terms
thereof. That is so because neither party claimed that he had suffered damages
as a result of the other's breach.
It follows that the learned magistrate correctly granted judgment for the
plaintiff in the amount referred to plus interest and costs and that the appeal
cannot succeed.

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The following order is made:
The appeal is dismissed with costs.
			
B. R. DU PLESSIS
Judge of the High Court
I Ag ree
			
L. M. MOLOPA
Judge of the High Court
Appellants Attorneys:
PT. Rautenbach 012 323 8520
Respondents Attorneys:
Serfontein Viljoen & Swart