Kirsten and Thomson CC t/a Nashua East London v CSARS
22 March 2013
Posted by: Author: SAIT Technical
Author: SAIT Technical
The North Gauteng High Court heard the
matter between Kirsten and Thomson CC t/a Nashua East London v CSARS and ABSA
Bank Ltd (case number 1681/08).
In this matter, the Plaintiff claimed
reimbursement for a double payment it had made to the Defendant in order to
settle its VAT liability. The Plaintiff relied on the condictio indebiti
against the Defendant. The condictio indebiti is an equitable remedy which
seeks to ensure that no one is unjustifiably enriched at the expense of
Kirsten and Thomson CC t/a Nashua East
London ("Plaintiff”) was liable to pay VAT to SARS ("First
Defendant”) for its trading activities for the period February – March 2007 in
the amount of R432 375.34.
In order to discharge its liability,
the Plaintiff drew a cheque on 5 April 2007 on the East London branch of FNB.
It was made payable to SARS and marked "non-transferable”. The cheque was
delivered to the East London branch of SARS on the same date.
SARS did not deposit the cheque or
receive its proceeds, as it was probably stolen by an unknown person. The
unknown person then copied certain particulars of the cheque and effectively
cloned the original cheque.
The name of the payee on the cloned
cheque was changed from SARS to "Bihlongwa Construction CC”. The cloned
cheque was deposited at an ABSA branch on 30 April 2007 for the credit of
Since the proceeds of the original
cheque was never collected by SARS, the Plaintiff’s VAT liability remained due
and in order to avoid interest and penalties in the amount of some R40000, a
second cheque was issued by the Plaintiff on 18 May 2007.
The following elements of condictio
indebiti had to be considered: impoverishment, enrichment and sine causa.
There were clearly visible
discrepancies in the dates of the original cheque and it was argued that FNB
should have refused to pay the cheque and should have sent it back to ABSA so
that it could be referred to drawer. The Plaintiff failed to prove that FNB was
not negligent and therefore failed to establish impoverishment on the facts.
SARS did not receive payment of the
first cheque. Therefore, the only way to prove enrichment was to show that SARS
had a good and viable claim against ABSA.
SARS clearly had a reason to retain
payment of the second cheque since it had a statutory obligation to collect
VAT. The Plaintiff also had a clear reason to make the second payment (it had
to discharge its VAT obligation). The second payment was therefore not sine
Accordingly, it was held that the
Plaintiff had not proved the requirements of condictio indebiti.
The claim was dismissed with costs
including the costs of two counsel.
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