THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Not Reportable
Case No: 278/2022

In the matter between:
MEMBER OF THE EXECUTIVE COUNCIL:
POLICE, ROADS AND TRANSPORT,
FREE STATE PROVINCIAL GOVERNMENT
APPELLANT
and
BOVICON CONSULTING ENGINEERS CC

FIRST  RESPONDENT
P ROODT NO
(SHERIFF BLOEMFONTEIN EAST)                                        SECOND RESPONDENT

Neutral citation:
MEC: Police, Roads and Transport Free State Provincial
Government v Bovicon Consulting Engineers CC and Another (278/2022) [2023]
ZASCA 99 (14 June 2023)

Coram:
PETSE AP and GORVEN and MABINDLA-BOQWANA JJA and
KATHREE-SETILOANE and MASIPA AJJA
Heard:
12 May 2023

Delivered:
14 June 2023

Summary:
In duplum rule – post-judgment interest not disallowed by in duplum rule
after arrear interest ceased to accrue when unpaid arrear interest equalled the capital
debt whilst litigation still pending.

ORDER

On appeal from: Free State Division of the High Court, Bloemfontein (Daniso J, sitting
as court of first instance):
Paragraph 5 of the high court’s order is set aside and substituted with the
following:

‘5. The applicant is ordered to pay interest on the amount of R2 343 549.66,

calculated at the prescribed interest rate prevailing on 6 December 2019 from

that date until the date of final payment, less the amount ordered in paragraph

4 above.’
Save as aforesaid, the appeal is dismissed with costs.
___________________________________________________________________
JUDGMENT
___________________________________________________________________
Petse AP and Masipa AJA (Gorven JA, Mabindla-Boqwana JA and Kathree-
Setloane AJA concurring):
[1] In Linton v Corser1 Centlivres CJ aptly observed that 'To-day interest is the life-
blood of finance, and there is no reason to distinguish between interest ex contractu
and interest ex mora'.2 This statement is as valid at the present time as it was more
than seven decades ago. This appeal is essentially about mora interest. In particular,
it concerns the issue of whether the operation of the in duplum rule disentitled the first
respondent, Bovicon Consulting Engineers CC (Bovicon), to post- judgment interest
on the amount owed to Bovicon. The Free State Division of the High Court,
Bloemfontein, per Daniso J, (the high court) granted an order in Bovicon’s favour
against the Member of the Executive Council: Police, Roads and Transport - Free
State Provincial Government (the MEC) for payment of post-judgment interest
accruing to the amount owed to Bovicon by the MEC. Thus, in effect, holding that
Bovicon was entitled to mora interest on the judgment amount for as long as it
remained unpaid.

1 Linton v Corser 1952 (3) SA 685 (A).
2 At 695G.

[2] The facts of this case are simple. On 19 August 2014, Bovicon issued summons
against the MEC for payment of the amount of R1 171 774.83 for services rendered
by it to the Department of Police Roads and Transport (the Department) during the
period from May 2012 to March 2013. In addition, Bovicon sought interest on the
amount claimed calculated at the rate of 15.5% from the due date of each invoice to
the date of final payment. The last invoice became due and payable on 31 March
2013. On 12 September 2019, the amount of accrued interest equalled the capital
debt. It was thus capped by the operation of the in duplum rule which increased the
total amount owing, as at 12 September 2019, to R2 343 549.66.

[3] The matter served before Chesiwe J who, on 5 December 2019, ordered the
MEC to pay to Bovicon the amount of R1 171 774.83 together with interest on the said
amount ‘from the due date of each invoice to date of final payment.’ On 14 July 2020,
seven months after the judgment, the Department paid to Bovicon an amount of
R2 343 549.66. Bovicon contended that it was entitled to post-judgment interest that
had accrued from 6 December 2019 to 14 July 2020. However, for its part the
Department contended otherwise.

[4] On 14 August 2020, Bovicon issued a warrant of execution, against the
Department and, pursuant thereto, the second respondent (the sheriff) attached some
of the Department’s movable property. On 27 December 2020 the MEC brought an
urgent application for an order setting aside the writ and the subsequent attachment.
The basis of the application was that Bovicon had not complied with s 3(1) of the State
Liability Act 20 of 19573 and that the judgment debt comprising the capital amount and
interest was, in any event, fully satisfied on 14 July 2020, including further interest that
had accrued between the date of judgment and the date of final payment.

[5] Bovicon resisted the application and also filed a counter-application. In the
counter-application, Bovicon claimed post-judgment interest of R220 332.09,
calculated at the rate of 15.5% from the date of judgment, ie 5 December 2019 to the

3 Section 3(1) of the State Liability Act reads:
'Subject to subsections (4) to (8), no execution, attachment or like process for the satisfaction of a final
court order sounding in money may be issued against the defendant or respondent in any action or
legal proceedings against the State or against any property of the State, but the amount, if any, which
may be required to satisfy any final court order given or made against the nominal defendant or
respondent in any such action or proceedings must be paid as contemplated in this section.'

date of payment, namely 14 July 2020. It also claimed interest on the said post-
judgment interest calculated at 15.5% from 14 July 2020 to date of payment.

[6] In the event, the high court set aside the writ and the resultant attachment as
unlawful and invalid. Bovicon was ordered to pay the costs of the main application on
the scale as between attorney and client. With respect to the counter-application, the
high court found in Bovicon’s favour and ordered the MEC to pay Bovicon the amount
of R220 332.09 – representing interest supposedly accrued on the judgment amount
– together with interest on that amount, calculated at the rate of 15.5% from 14 July
2020 to the date of final payment. As in the main application, the high court ordered
the MEC to pay the costs of the counter-application on the scale as between attorney
and client. The present appeal by the MEC is with the leave of the high court.

[7] In pursuit of its appeal, the MEC relied on numerous grounds. These were,
however, narrowed down to three points during the argument. First, it was argued that,
in effecting the payment of R2 343 549.66 on 14 July 2020, the MEC had fully satisfied
the judgment debt. Secondly, it was contended that even if it were found that the
judgment debt was not settled in full, the rate of interest applied by Bovicon was in
excess of the rate of interest prescribed in terms of the Prescribed Rate of Interest Act
55 of 1975 (Prescribed Rate of Interest Act). Lastly, the MEC contested the decision
of the high court awarding Bovicon costs on the scale as between attorney and client.

[8] As regards the first issue, counsel for the MEC argued that once accrued arrear
interest became equal to the amount owing to a creditor, in this instance Bovicon,
interest stopped running. Therefore, so the argument went, as the interest amount
became equal to the initial debt, Bovicon was not entitled to further interest on the
judgment debt beyond the date on which judgment was granted in its favour. Counsel's
argument is plainly unsustainable.

[9] In Paulsen and Another v Slip Knot Investment 777 (Pty Ltd),4 the Constitutional
Court considered the issue of whether interest runs anew, after it has ceased running
as a result of the in duplum rule, from the date of judgment until the judgment debt has

4 Paulsen and Another v Slip Knot Investments 777 (Pty) Limited [2015] ZACC 5; 2015 (3) SA 479 (CC);
2015 (5) BCLR 509 (CC).

been settled. Madlanga J, writing the main judgment, had this to say in relation to this
aspect:
‘It is settled law that the in duplum rule permits interest to run anew from the date that the
judgment debt is due and payable. The usual practice for appellate courts, including this Court,
is to retain the date on which the court of first instance handed down judgment as the date on
which judgment debts are due and payable. In oral argument, counsel for both the Paulsen’s
and Slip Knot accepted that in the order, for the purposes of calculating post-judgment interest,
the date on which the High Court entered judgment should be replaced with the date on which
this court hands down judgment.’5 (Citations omitted.)

[10] This reasoning was embraced and amplified by the majority as follows:
‘I also embrace the manner in which the main judgment resolved the debate over post-
judgment interest. For good reason it concludes that the in duplum rule permits post-judgment
interest to run afresh at the rate set by the loan agreement from the date of the judgment to
the date of payment. I support its order that the Paulsens must pay interest on the sum of the
capital and the capped interest, being R24 million, at the contract rate from the date of
judgment to the date of payment, limited to R24 million.6
Unsurprisingly, counsel was constrained to concede that his submission to the effect
that Bovicon was not entitled to interest on the judgment debt was devoid of merit.

[11] Following counsel’s concession, only two issues remain to be determined,
namely the appropriate prescribed rate of interest and the scale of costs. As to the
applicable rate of interest, Bovicon’s counsel fairly conceded that the high court erred
in awarding interest at the rate of 15.5% in respect of the judgment amount. Relying
on Griffiths v Janse van Rensburg and Another NNO,7 counsel accepted that the
source for the post-judgment interest is the judgment itself. Accordingly, the
appropriate rate of interest would be that prevailing at the time when judgment was
granted in the high court.

[12] Insofar as the punitive costs awarded by the high court are concerned, the high
court did not provide reasons as to what drove it to award costs on a punitive scale.
This must be deprecated. This Court has in the past lamented the failure by judicial
officers to give reasons for their decision when adjudicating cases. As Flannery v

5 Ibid para 96.
6 Ibid para 106.
7 Griffiths v Janse van Rensburg NO [2015] ZASCA 158; [2016] 1 All SA 643; 2016 (3) SA 389 (SCA)
paras 35 and 37.

Helifax Estate Agencies Ltd8 tells us, 'a requirement to give reasons concentrates the
mind, [and] if it is fulfilled, the resulting decision is much more likely to be soundly
based – than if it is not'. Nevertheless, counsel for the MEC readily accepted that it is
trite that the award of costs is at the discretion of the court. And that absent any
material misdirection, an appellate court will not interfere with the exercise of such
discretion. In this case, counsel could not point to any misdirection. Thus, subject to
the correction of the order of the high court as alluded to in paragraph 11 above, the
appeal must fail.

[13] There is one final issue that calls for adverse comment. It is this: the high court,
sitting as a court of first instance, granted leave to appeal to this Court. Section 17(6)
explicitly provides that if leave is granted under subsection 2(a) or (b)9 to appeal
against a decision of a Division as a court of first instance consisting of a single judge,
the judge granting leave must direct that the appeal be heard by a full court of that
Division. This is the default position. It therefore goes without saying that leave to
appeal to this Court against a decision of a Division sitting as a court of first instance
consisting of a single judge may be granted to this Court only where: (a) the decision
to be appealed involves a question of law of importance or in respect of which a
decision of this Court is required to resolve differences of opinion; or (b) the
administration of justice, either generally or in a particular case, requires consideration
by this Court.

[14] In the light of the aforegoing, it is difficult to discern why in this instance it was
thought that this case deserves the attention of this Court. This Court has in the past
sounded a word of caution to Judges in the courts of first instance, emphasising that
it is the duty of the Judge in the court of first instance to consider what court is the
more appropriate in the circumstance of each case. Where the issue is one of fact or
raises no complex legal principle, leave should, as a general rule, be granted to the

8 Flannery v Helifax Estate Agencies Ltd [2000] 1 WLR 377 at 381H. See also: Botes and Another v
Nedbank Ltd 1983 (3) SA 27 (A) at 27H-28A; Mphahlele v First National Bank of SA Ltd 1999 (2) SA
667 (CC) para 12.
9 Section 17(2)(a) and (b) reads:
'(a) Leave to appeal may be granted by the judge or judges against whose decision an appeal is to be
made or, if not readily available, by any other judge or judges of the same court or Division.
(b) If leave to appeal in terms of paragraph (a) is refused, it may be granted by the Supreme Court of
Appeal on application filed with the registrar of that court within one month after such refusal, or such
longer period as may on good cause be allowed, and the Supreme Court of Appeal may vary any order
as to costs made by the judge or judges concerned in refusing leave.

Full Court. Indeed this is what the Superior Courts Act contemplates.10 Only in
circumstances where the issue raised deserves the attention of this Court because,
for example, of complexity, a general question of law of importance, discordant
judgments or novelty should leave be granted to this Court.

[15] In short, this means that a single Judge who would have had intimate
knowledge of the issues involved in a particular case before whom those issues were
debated would therefore be able to screen the case, so that matters of pure fact or
fact and law – where the law is not controversial – would be referred to the Full Court.
This would in turn mean that the valuable time of this Court would be profitably devoted
to complex issues of law.

[16] This Court has, in the past, consistently deprecated the inappropriate granting
of leave to appeal to it. This is because doing so needlessly increases the costs of
litigation and, importantly, results in cases involving greater difficulty and truly
deserving of its attention having to compete for a place on this Court's roll with cases
which are not.11

[17] As a general rule, appellate courts are extremely loathe to criticise Judges in
the courts of first instance in the interests of judicial comity. However, given that many
admonitions in the past have gone unheeded, a time will soon come when this Court
might well consider adopting a robust stance and invoke the powers accorded to it by
S17(6)(b)12 of the Superior Courts Act.

[18] In the result, the following order is made:
Paragraph 5 of the high court’s order is set aside and substituted with the
following:

10 See s 17(6) of the Superior Courts Act 10 of 2013.
11 See, for example, Shoprite Checkers (Pty) Ltd v Bumpers Schwarmas CC and Others 2003 (5) SA
354 (SCA) para 6 of the concurring judgment of Marais JA; Exdev (Pty) Ltd and Another v Pekudei
Investments (Pty) Ltd 2011 (2) SA 282 (SCA) para 28; S v Monyane and Others 2008 (1) SACR 543
(SCA) para 28; S v Myaka 1993 (2) SACR 660 (A) at 661i-662b.
12 Section 17(6)(b) provides:
'Any direction by the court of a Division in terms of paragraph (a), may be set aside by the Supreme
Court of Appeal of its own accord,...,and may be replaced by another direction in terms of paragraph
(a).'

‘5. The applicant is ordered to pay interest on the amount of R2 343 549.66,

calculated at the prescribed interest rate prevailing on 6 December 2019 from

that date until the date of final payment, less the amount ordered in paragraph

4 above.’
Save as aforesaid, the appeal is dismissed with costs.

X M PETSE
ACTING PRESIDENT
SUPREME COURT OF APPEAL

M B S MASIPA
ACTING JUDGE OF APPEAL

APPEARANCES
For appellant:
C Georgiades SC
Instructed by:
Lebea & Associates, Johannesburg

Lovius Block Inc, Bloemfontein

For first respondent:
S Grobler SC
Instructed by:

Schoeman Law Inc, Cape Town

Peyper Lessing, Bloemfontein

THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
MEDIA SUMMARY OF JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL
From:
The Registrar, Supreme Court of Appeal
Date:
14 June 2023
Status:
Immediate
The following summary is for the benefit of the media in the reporting of this case and does not form
part of the judgments of the Supreme Court of Appeal
MEC: Police, Roads and Transport, Free State Provincial Government v Bovicon Consulting Engineers
CC & Another (278/2022) [2023] ZASCA 99 (14 June 2023)

Today, the Supreme Court of Appeal (SCA) dismissed with costs an appeal by the MEC: Police, Roads
and Transport, Free State Provincial Government (the MEC) against the judgment of the Free State
Division of the High Court, Bloemfontein (the high court). The high court had upheld a claim for post
judgment interest in favour of the first respondent, Bovicon Consulting Engineers CC’s (Bovicon).

The facts of the matter were as follows. The MEC and Bovicon concluded a contract in terms of which
Bovicon provided services to the MEC for which the MEC failed to pay. Consequently, Bovicon issued
summons. Two months prior to the issuing of summons, interest on the debt had accumulated to the
same value as the capital amount. On 5 December 2019, Bovicon obtained a judgment against the MEC.
However, payment on the judgment debt was effected seven months later, on 14 July 2020. Bovicon
contended that it was entitled to post judgment interest from 6 December 2019 until 14 July 2020. When
this interest remained unpaid, Bovicon issued a warrant of execution against the MEC resulting in the
attachment of the Department’s movable property.

The MEC launched an urgent application to set aside the warrant of execution citing non-compliance
with the provisions of the State Liability Act. Bovicon opposed the application and also filed a counter-
application for the post judgment interest. The high court set aside the warrant of execution and declared
the attachment unlawful. It also awarded Bovicon the post judgment interest calculated at the rate of
15,5%. Furthermore, the high court granted cost orders against the losing party on the scale in between
attorney and client in respect of each of the applications without providing any reasons for granting a
punitive costs order.

In the SCA three main issues were argued: firstly, whether the MEC had fully satisfied the judgment
debt by means of the payment made on 14 July 2020; secondly, if the judgment debt remained unsettled,
what the applicable rate of interest was at the time when judgment was granted; and thirdly, whether
the high court erred in awarding Bovicon punitive costs. Additionally, the SCA addressed the
inappropriate granting of leave to appeal to the SCA which, in its view, should not have been done.

The SCA found that it was settled law that interest ran anew post judgment until the judgment debt was
paid in full. The parties agreed that the appropriate rate of interest would be the prevailing rate at the
time when the high court granted judgment. The MEC acknowledged that the awarding of costs is in
the discretion of the court which will not to be interfered with in the absence of material misdirection.
However, as there were no reasons provided by the High court on why it awarded punitive costs, the

SCA lamented the absence of reasons and emphasized the importance and the need for courts to provide
reasons for their decisions.

In respect of the inappropriate granting of leave to appeal to the SCA, it was found that the high court
had disregarded the provisions of the Superior Court Act (the Act) which stipulates that leave to appeal
from judgments of a single Judge of the High Court, sitting as a court of first instance, should only be
granted in instances where the decision appealed against involves important questions of law,
conflicting judgments require resolution, or when the case necessitates consideration by the SCA. In
this case, there was no justification why the appeal deserved the attention of the SCA. The SCA
censured the high court for disregarding the provisions of the Act and warned that in future it would
seriously consider invoking its powers to set aside leave to appeal granted in disregard of the Act and
its admonitions.

~~~~ends~~~~