Case no: 81/85 E du P
IN THE SUPREME COURT OF SOUTH AFRICA
(APPELLATE DIVISION)
In the matter between
CARGO MOTORS 	 Appellant
and
G L MOTORS 	 Respondent
Coram: RABIE, CJ ,JOUBERT, HOEXTER, HEFER et
JACOBS, JJA.
Heard:	Delivered
13 May 1986
JUDGMENT
RABIE, CJ: /

RABIE, CJ:
This case began as an application in the
Witwatersrand Local Division in which the present
appellant, a distributor of Mercedes Benz motor vehicles,
prayed for an order directing the respondent, a dealer
in motor vehicles, to hand over to it a 1984 model
Mercedes Benz 500 SEC motor car of which the appellant
alleged that it was the owner. The appellant's case,
of which fuller details will be given below, was that
it had on 17 May 1984 in a cash transaction sold and
delivered the aforesaid vehicle to one Lukas Malepe;
that the cheque which was given to it in payment of
the purchase price of the vehicle was a forgery, and
that, by reason of the fact that the purchase price
was/.........

3
was not paid, the ownership in the vehicle remained
vested in the appellant. The respondent company
(Crown Service Station (Pty) Ltd, which trades as G.L
Motors) denied that the appellant was the owner of the
vehicle and alleged that the respondent had on or
about 23 May 1984 purchased the vehicle in a cash
transaction from one Terror, who had, in turn, bought
the vehicle for cash from Lukas Malepe. The respondent
alleged, furthermore, that even if the appellant were
still the owner of the vehicle, it was estopped from
vindicating it from the respondent. After the
appellant had filed an affidavit in reply to the respondent's
opposing affidavit, the application was referred for
the hearing of oral evidence on certain issues as
defined/......

4
defined by the Court. At the conclusion of the hearing
Kriegler,J, dismissed the application with costs, holding
that the appellant had parted with its ownership in the
vehicle when it sold and delivered it to Malepe on 17
May 1984. The learned Judge went on to say that, if
it had been necessary to decide the matter on the basis
that the appellant had retained its ownership in the
 vehicle,he would have held, for the reasons stated by
 him in his judgment, that the appellant was estopped
from asserting its ownership as against the respondent
(The appeal is against the whole of the judgment of
the Court a quo.
The appellant called three witnesses. The
first/.......

5
first was Mr. R W Brien, who testified that he was the
manager, and "the person in charge", of the appellant's
branch in Rosebank, Johannesburg. (In a statement
made by him to the police on 24 May 1984 he referred to
himself as the "sales manager" at the appellant's Rosebank
branch.) The second witness was Mr. A D Venables, the
appellant's financial director, and the third was Mrs
 Nielson, a credit control clerk at the appellant's
head-office in Johannesburg. The respondent called
only one witness, viz. Mr. J F E Tutt, its managing
director. The facts of the case, as they emerge
from the evidence, are, in so far as relevant, set
out below.
According to Brien, he heard on 14 May 1984
that/.....

6
that there were "negotiations in progress" with regard
to the sale of the above-mentioned Mercedes. (All
the dates mentioned below were dates in May 1984.)
One Müller, a salesman in the appellant's employ,
conducted the negotiations on behalf of the appellant
The prospective purchaser, Brien was informed, was one
Lukas Malepe. According to reports made to Brien,
Malepe was a Black man from Maseru, Lesotho, who stayed,
while in Johannesburg, at the Carlton Hotel. Staying
with Malepe at the Carl ton Hotel, Brien was told, was
a Mr. Hanley, who was said to be Malepe's adviser.
Brien assumed that Malepe visited the appellant's premises
and that Müller spoke to him there. Brien himself
never saw Malepe. Miiller, according to Brien, also
spoke/. .	

7
spoke to Malepe on the telephone, and also went to
the Carlton Hotel, where (so Brien was told) he spoke
"to several people". Brien told Müller that, because
the would-be purchaser was from Lesotho, the appellant
would "require a bank guaranteed cheque before he could
deliver the vehicle to him." Subsequently, Brien
testified, Müller told him that they'd agreed they would
get the bank guaranteed cheque", and that the cheque was
"to be flown" to Johannesburg "on the daily service
from Maseru." The purchase price of the car was to be
R97 050. On 15 May Brien received a telephone call
from someone who, according to Brien, spoke in "an accent
from the Southern part of England". This man introduced
himself as "Hanley" and said to Brien that the delays
in/......

8
in the transaction concerning the vehicle "were causing
him perhaps to reconsider the purchase". "In other words",
Brien testified, "he was putting pressure on me to get
the car delivered to him - or to Malepe." The next day
(16 May) Brien dropped Müller off at the Carlton Hotel .
Müller was there given a cheque, which he took to the
appellant's premises in Rosebank, where Brien saw it.
The date on the cheque was 16 May 1986. It was not a
bank guaranteed cheque, but purported to be a bank cheque
for R97 050, drawn by Barclays Bank International Limited,
Maseru, Lesotho, on itself, in favour of "Cargo Motors."
On 17 May Brien was handed a document which purported
to contain an offer by Malepe to buy the vehicle
from /......

9
from the appellant for R97 050. It was a printed document,
headed "Offer to Purchase", on which Müller had written
the name "Lukas Malepe", and the address "Maseru, Lesotho"
Malepe did not sign the document. The space provided
in the document for the signature of the "purchaser"
was left vacant. Brien signed his name at the foot of
the document, next to the printed words "Authority to
Process". By giving this "authority", Brien testified,
he "authorised the deal". After he had given this
authprity, Brien said, he sent the "deal", with the
aforesaid cheque, to Mr. Niel Calder, the appellant's
credit manager. The credit manager, he testified,
is the person who determines the manner of payment and
who decides "whether ownership passes or not or whether
the/......

10
the deal goes through or anything else." Calder accepted
the aforesaid "Offer to Purchase" by signing his name
and writing the date 17.5.1984 below the printed words
"This Offer Accepted For And On Behalf Of Cargo Motors
Corporation Limited." Above these printed words, in
a space provided (so it seems) for the noting of "Other
Instructions", Calder wrote: "COD PD". Brien conceded
that these letters meant "Cash on Delivery Paid ".
After this document had been signed by Calder, it was
returned to Brien. On the same day (17 May) a "Vehicle
Invoice" relating to the sale of the vehicle was issued
by the appellant's Rosebank branch. The invoice
contained the name Lukas Malepe; the address "Maseru
Lesotho/.......

11
Lesotho"; particulars of the vehicle; the purchase
price and, also, next to the printed word "Terms",
the typwritten letters "C.O.D)."
According to Brien the vehicle was delivered
to the purchaser by Müller on 18 May. There were also
handed over, one gathers from Brien's evidence, the
aforesaid invoice; a temporary licence; a temporary
third party disc; the necessary registration papers;
a change of ownership form; "guarantee forms";
two sets of keys to the car, and an owner's manual.
On the morning of 23 May the aforesaid Tutt
called on Brien at the latter's office. The reason
for the visit, according to Tutt, was as follows.
On/......

12
On 21 May one Pienaar and a Black man, who was not
known to Tutt, came to Tutt's place of business to
inquire whether he (Tutt) would be interested in buying
a virtually new 500 SEC Mercedes Benz motor car. A price
of about R75 000 was mentioned. They did not have the
car with them, and Tutt said that he would like to see
it. They brought the car the next day (22 May).
There was then a third man with them who was introduced
to Tutt as Louis Ferror. Tutt was told that Ferror
was the owner of the car, and that he had paid Malepe
R80 000 for it. Tutt was interested in buying the
car, but he was suspicious of the offer because the
vehicle was virtually new (it had done only about 1 400
kilometres) and because the price asked for it was
much/......

13
much less than the price of a new car of that kind.
Tutt, who was shown the papers which the appellant had
over handed/when it delivered the vehicle, called for proof
of Ferror's title and also asked for a clearance by
the police to the effect that the vehicle was not
listed as stolen. Ferror thereafter produced an
affidavit, attested to before an attorney, wherein the
deponent, who said that he was Lukas Malepe, declared
that he had sold the vehicle to Ferror and that Ferror
had paid him the purchase price of R80 000 in full.
Ferror also produced a clearance by the police, as
requested. Tutt, still uneasy about the offer made to
him, then went to see Brien, whom he knew well. There
is/....

14
is little reason to doubt that Tutt wished to establish
whether it would be safe for him to buy the car from
Ferror, and that he put questions to Brien with a view
to discovering whether the appellant still had an interest
in the car which could be affected if he (Tutt) were
to buy the car. There is, however, a dispute on the
evidence as to precisely what questions Tutt put to
Brien and what answers he received in reply thereto.
In view of the conclusion to which I have come regarding
the appeal, I do not propose to set out the evidence
relating to that dispute. Suffice it to say that the
learned Judge found that neither Brien nor Tutt was
a particularly satisfactory witness, but that there
were "overwhelming probabilities" that "Brien did
represent/.....

15
represent to Tutt that the applicant (appellant) had
no "further interest in the vehicle.
Tutt bought the vehicle from Ferror shortly
after midday on the day of his conversation with Brien,
He paid Ferror R30 000 in cash and delivered to him a
motor car valued at R40 000.
Following on his conversation with Tutt,
Brien telephoned Mrs. Nielson and Mr. Venables. He
told them about the transaction with Malepe and asked
them whether the cheque had been paid. They caused
inquiries to be made, and during the afternoon of the
next day (24 May) Brien was informed that the cheque
was a forgery.
Tutt succeeded in recovering the motor car
which/......

16
which he had delivered to Ferror, but not the R30 000
he had paid to him in cash.
The learned Judge found that the cheque that
had been given to the appellant in payment of the vehicle
was accepted by Calder "as being as good as cash", and
that in the absence of any evidence to the contrary by
Calder it should be concluded that he "intended to
transfer ownership in the vehicle, fondly believing
that the bank cheque was infallible and that he would
never see or have to concern himself with Malepe or the
vehicle again."
Mr Goldblatt, for the appellant, submitted
that the trial Court erred in holding that the onus was
oh the appellant to prove that it was the owner of the
vehicle/	

17
vehicle, and, also, in finding on the evidence that the
appellant had parted with its ownership in the vehicle.
As to the question of onus, counsel submitted
that the trial Court should have held that the onus was
on the respondent to show that the appellant was not
the owner of the vehicle. His contention was, as I
understood it, that since the appellant was the owner
of the vehicle before the conclusion of its aforesaid
transaction with Malepe, the onus was on the respondent
to prove, if it wished to retain possession of the
vehicle as against the appellant, that the appellant
had parted with its ownership when it sold and delivered
the vehicle to Malepe. I do not agree with this
contention. The application constituted a rei vindicatio.
The/........

18
The appellant alleged that it was the owner of the
vehicle and it sought to recover it on the basis of its
ownership. The respondent denied that the appellant
was the owner, and in the circumstances the onus was on
the appellant to prove its ownership. There is ample
authority to the effect that in vindicatory proce
the onus is on the claimant to prove his ownership.
See e.g. Voet 6.1.20; Marcus v. Stamper and Zoutendyk
1910 AD 58 at 72, and Ruskin NO v. Thiergen 1962(3) SA
737 (A) at 744.A-F
In contending that the trial Court erred
in finding that Calder must be held to have accepted
the cheque "as being as good as cash" and to have intended
to part with the appellant's ownership in the vehicle,
Mr/......

19
Mr Goldblatt commenced his argument by referring to a number of decided, cases in support of the following legal submissions, viz.:
(i) that every sale is, in the absence of proof to the contrary, presumed to be a sale for cash;
(ii) that in a sale for cash ownership in the thing sold does not pass until the purchase price has been paid, even if delivery has meanwhile been made; and
(iii) that payment by cheque does not constitute payment until the cheque is met, and that the fact that a seller has taken a cheque in payment does not lead to an inference that he has given credit to the buyer.
(With regard to (i), counsel referred to Laing v. South African Milling. Co. Ltd 1921 AD 387 at 399; Lendalease Finance (Pty) Ltd v. Corporacion Mercadeo Agricola
and/.....

20
and Others 1976(4) SA 464(A) at 490 E-F; and, with
regard to ( ii ) and ( i ii ) , he relied on Grosvenor Motors
(Potchefstroom) Ltd v. Douglas 1956(3) SA 420 (A) at
423 H-425 A; Nowell v. Franzen 1956(4) SA 35(C) at; 38
G-39 C; Bold v. Cooper and Another 1949(1) SA 1195(W) at 1199 i.f. -
1200; Eriksen Motors (Welkom)Ltd v. Protea Motors,
Warrenton and Another 1973(3) SA 685(A) at 693 F-694 A,
and the Lendalease case, supra, at 490 A-F). The
transaction in the present case, counsel argued, was
a cash sale; ownership in the vehicle would, therefore,
have passed to Malepe only upon payment of the purchase.
price; the price was not paid, the cheque having been
a forgery, and consequently ownership in the vehicle
remained vested in the appellant. Thus the argument
The/.....	

21
The fact that Calder wrote "COD PD" on the "Offer to
Purchase", counsel submitted, was no indication that
he believed that the cheque was as good as cash, but
merely meant that Malepe had complied with the request
(as testified to by Brien) that he should furnish the
appellant with a bank guaranteed cheque. Counsel
conceded that the appellant clearly believed that the
cheque would be met, but be submitted that that did
not mean that it was prepared to let its ownership in
the vehicle pass to the purchaser before the cheque
was paid.
I am not persuaded that the trial Court erred
in its aforesaid view of the matter. While it is no
doubt a rule of our law, as was submitted by Mr Goldblatt,
that/......

22
that a sale is usually, in the absence of evidence
pointing to a different conclusion , presumed to be a
cash sale, and that in a cash sale ownership in the thing
sold does not, despite delivery, pass to the purchaser
until the purchase price has been paid, one cannot,
on the evidence given in the present case, safely
conclude that the transaction in issue was a cash sale
in which the seller intended that its ownership in the
thing sold would not pass before the purchase price
was paid. The question as to when, in any particular
transaction, ownership is to pass, has to be determined
with reference to the intention of the contracting parties
as it emerges from the terms of their agreement, and,
where relevant, the surrounding circumstances and the
conduct/......

23
conduct of the parties. (See Weeks and Another v.
Amalgamated Agencies, Ltd 19 20 AD 218 at 230; Eriksen
Motors (Welkom) Ltd v. Protea Motors, Warrenton and
Another, supra, at 694 A, and the Lendalease case, supra,
at 489 i.f. - 490 A.) In the present case there is
no direct evidence as to all the terms on which the
parties contracted. Müller, who conducted the
negotiations leading up to the conclusion of the sale
on behalf of the appellant, did not give evidence.
Brien was called to testify, but he had no first-hand
knowledge of what passed between Müller and the purchaser
of the vehicle, and he could not testify as to Calder's
state of mind when he accepted the cheque and authorised
the/	

24
the delivery of the vehicle to Malepe. With regard
to Brien's evidence, reference should perhaps be made
to the contents of a booklet, issued by the appellant
for use by its salesmen and staff, on which he was
examined by counsel for the respondent. In this booklet
employees of the appellant are told that in a cash
on delivery transaction the vehicle may only be handed
over after receipt of "cash for the full amount of the
invoice", or "a cheque, but not a post-dated cheque"
With regard to payments by cheque, the instruction
reads that "there are instances where a cheque will
not be acceptable until cleared by the bank or
guaranteed by the bank". The last-mentioned
note would seem to indicate - I put it no higher
than/......

25
than that - that a bank guaranteed cheque was considered
by the appellant to be as good a guarantee of payment
as a cheque "cleared by the bank". It may be added
in this connection that Brien stated that it was his
belief that a bank guaranteed cheque could not be
countermanded, and that a banker could not refuse to
pay such a cheque. With regard to the cheque in issue
in this case, he stated that "it wasn't cash", but that
he regarded it as suitable", i.e. that it "would be met",
and that he "felt that the interests of the company 	
were protected by this particular cheque."
As pointed out above, it was Calder, the appellant's
credit manager, who accepted the cheque, who signed
the "Offer to Purchase" form on behalf of the appellant
and/......

26
and wrote thereon the letters "COD PD", and who authorised
delivery of the vehicle to Malepe. This being so,
it is clear that it is the intention with which Calder
did these things which is decisive of the question
whether the appellant intended to transfer its ownership
in the vehicle to the purchaser. (It may be added
at this point that it was not disputed that Malepe wished
to make himself owner of the vehicle.) Calder, as
said before, was not called to testify and the trial
Court held that, in the absence of evidence by him
which could lead one to a different conclusion, the
inference to be drawn from all the evidence in the case
was that he considered the cheque to be tantamount to
cash and that he was prepared to let the ownership in
the vehicle pass to Malepe.
I/........

27
I have already indicated that I am not
persuaded that the trial Court's decision was wrong.
I think the inference is justified that Calder would
not have written the letters "COD PD" on the "Offer
to Purchase" form if he had"not regarded the cheque as
tantamount to cash. One may add in this connection
that Calder would have had good reason to believe
that the cheque was as good as cash. It was, on the
face of it, a cheque drawn by Barclays Bank International
on
Limited/itself, in favour of the appellant, and, there
being nothing which suggested that it was not a genuine
document, Calder would have good reason to believe that
it was as good as cash. If he held such a belief (as
it would seem that he did), it would explain why he
wrote/.......

28
wrote "COD PD" on the "Offer to Purchase" form and
why he authorised delivery of the vehicle to Malepe.
Calder's conduct, one may add, would not seem to have
been in conflict with the appellant's aforementioned
policy regarding delivery of a vehicle when payment
is made by cheque. Counsel for the appellant submitted,
as stated above, that by writing "COD PD" on the "Offer-
to Purchase" form, Calder intended to indicate no more
than that Malepe had complied with Brien's request
that a bank guaranteed cheque should be furnished.
This submission does not, in my view, afford a
satisfactory explanation for Calder's use of
the word "paid" ("PD"), and I find myself unable to
agree with it.
There/......

29
There are, as pointed out in the judgment
of the Court a quo, various considerations which support
the view that Calder regarded the cheque as tantamount
to cash, and that, when he authorised the delivery of
the vehicle, his intention was that ownership in the
vehicle should pass to Malepe. According to inforniation
available to Brien at the time of the transaction,
Malepe was going to take the vehicle to Lesotho. It
was for this reason, Brien said, that no sales tax was
payable in respect of the sale of the vehicle. Calder,
too, would have seen on the "Offer to Purchase" form
that Malepe was said to be a resident of Maseru, and,
also, that no sales tax was payable in respect of the
sale. It seems to me that if Calder had not regarded
the/......

30
the cheque as being as good as cash and had not intended
that ownership in the vehicle should pass to Malepe ,
the appellant would, at the very least, have taken steps
to establish precisely where in Maseru Malepe resided,
and what his business or occupation was. No attempt
was made to do so. This is not all. It does not
even appear from the evidence that there ever was a
person called Lukas Malepe. Brien never saw anyone
by that name, and it does not appear from his evidence
whether Müller saw such a man or whether he merely
negotiated with Hanley, who was said to be Malepe's
adviser, or someone else. (It is not strange, in the
circumstances, that the learned trial Judge said that,
for all the appellant knew, Malepe was "merely the
figment/......

31
 figment of some criminal's ingenuity".) One should add,
also, that various documents which served to suggest that
Malepe was the owner of the vehicle, were handed over
by the appellant when the vehicle was delivered to the
purchaser. A final point to note is that the appellant
received the cheque on 17 May, but that it never made
any inquiries as to whether it was a good cheque or
whether it had been met until after Tutt had spoken to
Brien on 23 May. Evidence given by Venables shows,
it seems to me, that the necessary information could
have been obtained in less than an hour.
Mr Goldblatt submitted that motor dealers

do not always exercise the

caution about

receiving payment when they make delivery of vehicles
sold/......

32
sold by them, and that the appellant's failure to take
precautions of the kind mentioned above should not be taken
to indicate in any way that Calder believed that the cheque was as good
as cash and that the appellant could, therefore, safely part with its
ownership in the vehicle. The submission as to the
lack of caution sometimes displayed by motor dealers is
not based on any evidence on record. Furthermore,
as far as the present case is concerned, it should be
noted that Brien agreed with cross-examining counsel's
suggestion that steps by the appellant to establish
Malepe's identity and his residential address, etc.,
were thought to be ''unnecessary once you had a Barclays cheque."
In conclusion I should say that Mr Goldblatt
contended that the trial Court was not entitled to draw
the/........

33
the inference it did from the fact that Calder was not
called to give evidence. Counsel contended, if I under-
stood him correctly, that the rule that an adverse
inference may be drawn against a party for not
calling an available witness applies
only to the case where there are two likely versions
concerning an issue before the Court, and that the
present case is not one where the Court was called upon
to decide between two such versions. I do not agree
with the argument. The fact that Calder wrote "COD PD"
on the "Offer to Purchase" form, coupled with the fact
that the appellant did not take precautions (as referred
to above) which it would probably have taken if it had
believed/......

34
believed that it remained vested with the ownership
of the vehicle, strongly suggests that Calder considered
the cheque to be as good as cash and that he was accordingly-
prepared to let ownership in the vehicle pass to Malepe,
and in the absence of evidence by Calder showing
that the drawing of such an inference would not be
warranted, I am of the opinion that one cannot say
that the trial Court erred in coming to the conclusion
that it did.
In view of what I have said above, I do
not find it necessary to discuss the defence of estoppel
that was raised by the respondent.
The/.......

35
The appeal is dismissed with costs, including
the costs of two counsel.
P J RABIE CHIEF JUSTICE
JOUBERT, JA.
HOEXTER, JA.
Concur HEFER, JA.
JACOBS, JA.