THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Not Reportable

Case no: 851/2019

In the matter between:
LAMBERTUS VON WIELLIGH BESTER NO
FIRST APPELLANT
RYNETTE PIETERS NO
SECOND APPELLANT
BAREND PETERSON NO
THIRD APPELLANT
(In their capacities as joint trustees of the RVAF TRUST – RV IT 932/2004)
and
ANTON GOUWS
FIRST RESPONDENT
SCHALK W J STEENKAMP
SECOND RESPONDENT
JOHAN JOUBERT
THIRD RESPONDENT
SWARTLAND MAKELAARS CC
FOURTH RESPONDENT
MARK EISERMAN
FIFTH RESPONDENT
MARK ALEXANDER INVESTMENTS CC
SIXTH RESPONDENT
JANNIE AUGUSTYN
SEVENTH RESPONDENT
ANDREA FREDERICKA MOOLMAN
EIGHTH RESPONDENT
VAIDRO 172 CC
NINTH RESPONDENT

HENDRIK JANSE VAN VUUREN
TENTH RESPONDENT
HENDRIK VAN VUUREN MAKELAARS CC
ELEVENTH RESPONDENT

Neutral citation: Bester and Others NNO v Gouws and Others (851/2019) [2020]
ZASCA 174 (17 December 2020)
Coram:
PONNAN, WALLIS, ZONDI and DLODLO JJA and WEINER AJA
Heard:
4 November 2020
Delivered: This judgment was handed down electronically by circulation to the
parties' representatives via email, publication on the Supreme Court of Appeal
website and release to SAFLII. The date and time for hand-down is deemed to be
10:00 am on 17 December 2020.
Summary: Prescription Act 68 of 1969 – sections 12(1) and 12(3) – knowledge
of identity of debtor and basis of cause of action – when knowledge acquired or
deemed to have been acquired through the exercise of reasonable care.

________________________________________________________________
ORDER
________________________________________________________________
On appeal from: Western Cape Division of the High Court, Cape Town (Meer
J, sitting as court of first instance):
The appeal is dismissed with costs, including the costs occasioned by the
employment of two counsel, save that the costs of the preparation, perusal and
copying of the record shall be limited to 60% of the costs incurred in those tasks.

________________________________________________________________

JUDGMENT

________________________________________________________________

Weiner AJA (Ponnan, Wallis, Zondi and Dlodlo JJA concurring)
[1]     ‘If something sounds too good to be true, it probably is.’ This adage is
particularly apt in situations where once hopeful investors are suddenly left
with nothing, save for much remorse, notwithstanding the extravagant returns
promised. That is the unfortunate lesson that investors in the RVAF Trust (the
Trust) learned from its demise and insolvency. Investors were promised
irresistible (but unsustainable) returns on their investment. The Trust paid

such returns for a period but when the predictable collapse occurred, the total
amount due to investors vastly exceeded the total amount of money available.
[2]     This judgment involves the more mundane question of whether claims,
brought by the trustees of the insolvent Trust to recover commissions paid to
brokers who solicited those investments, have prescribed. The Western Cape
Division of the High Court, Cape Town (Meer J) held that they had, and
refused leave to appeal. This appeal is with the leave of this court.
Background
[3]     From the early 2000s, Mr Herman Pretorius began operating an investment
scheme (the scheme) through which he solicited investments from the public
on a large scale. As part of the operation of the scheme, he recruited a number
of investment brokers (the brokers). Together with the brokers, he succeeded
in enticing a considerable number of investors to invest huge amounts in his
scheme on the basis that it would yield returns far exceeding those achieved
by conventional established institutions. He promised returns of between 14%
and 25% per annum.
[4]     These promises were fulfilled during the early years of the scheme, and both
old and new investors appeared to have the utmost faith in Mr Pretorius and
accepted the reported returns of the scheme at face value. The funds raised by
Mr Pretorius through his scheme soon escalated to approximately R200
million.
[5]     In March 2004, Mr Pretorius created the Trust as part of an entity styled the
Abante Group (the Group). Mr Pretorius and Mr Eduard Brand were appointed
as trustees of the Trust. It is common cause that the Trust deed provided that
a minimum of three trustees were required and that they had to act jointly in

all events. It is also common cause that Mr Pretorius took control of the Trust,
did not consult Mr Brand on decisions, and operated the scheme on his own.
[6]     The scheme was, however, a fraudulent and illegal pyramid style
investment scheme and the Trust was used as part of this fraudulent Ponzi
scheme. The scheme collapsed after its mastermind, Mr Pretorius, killed his
former business partner, Mr Williams and committed suicide on 26 July 2012.
This incident triggered action by investors against the Group, in particular the
Trust. Investors began clamouring for the return of their investments. These
were not forthcoming.
[7]     On 30 July 2012, Mr Morné Strydom, an investor, applied to sequestrate
the Trust. The provisional sequestration order was granted on 1 August 2012.
The appellants were appointed as provisional trustees on 7 August 2012. On
the same day, the Master provided authority in terms of s 18(2) of the
Insolvency Act 24 of 19361 (the Act) for the provisional trustees to appoint
attorneys to provide them with legal advice. The Trust appointed Mostert &
Bosman Attorneys (MB). On 17 August 2012, the appellants also obtained an
order granting them the necessary power to institute legal proceedings in terms
of s 18(3) of the Act.2
[8]     The Trust was finally sequestrated on 3 September 2012. The appellants
were appointed final trustees on 23 October 2012. Summonses were instituted

1 Section 18 of the Act provides:
‘Appointment of provisional trustee by Master
(1) …
(2) At any time before the meeting of the creditors of an insolvent estate in terms of section 40, the Master may,
subject to the provisions of subsection (3) of this section, give such directions to the provisional trustee as could
be given to a trustee by the creditors at a meeting of creditors.’
2 Section 18(3) provides:
A provisional trustee shall have the powers and the duties of a trustee, as provided in this Act, except that without
the authority of the court or for the purpose of obtaining such authority he shall not bring or defend any legal
proceedings and that without the authority of the court or Master he shall not sell any property belonging to the
estate in question. Such sale shall furthermore be after such notices and subject to such conditions as the Master
may direct.’

against the respondents on 9 November 2015, more than three years later. The
respondents are all brokers who introduced investors to the scheme conducted
by the Trust between October 2004 and June 2012. They received commission
payments from the Trust for such referrals.
[9]     The appellants, as trustees, instituted action against the respondents on two
bases: under the common law (on the basis of unjust enrichment);
alternatively, under s 26 and s 32 of the Act. The appellants claimed that the
commissions that the respondents earned were repayable on the basis that:
(a)
at all material times there were fewer than the minimum number of trustees
as specified in the trust deed holding office. The Trust therefore lacked
capacity to make any payments to the respondents;3
(b)
Mr Pretorius acted unilaterally to the exclusion of his co-trustee, Mr Brand;
(c)
The trustees failed to exercise the powers in accordance with the trust deed
and the commission payments were made to the respondents pursuant to
the operation of an unlawful and fraudulent pyramid or Ponzi type scheme;
(d)
In the alternative, the payments were claimed on the basis that they were
impeachable transactions under s 32 of the Act (i.e. dispositions without
value).
[10] The respondents raised certain defences on the merits and two special pleas
of prescription. These pleas were heard separately by the high court in terms
of rule 33(4) of the Uniform Rules of Court. The separate actions against the
brokers were consolidated for the purposes of the hearing and the case

3 Land and Agricultural Bank of South Africa v Parker and others 2005 (2) SA 77 (SCA)

proceeded using the claim against the tenth and eleventh respondents as the
test case applicable to all.
[11] The first prescription plea was that the appellants had, or should have had
the requisite knowledge under s 12(3) of the Prescription Act 68 of 19694 (the
Prescription Act) on either 17 August 2012 (the date on which the appellants
obtained the order in terms of s 18(3) of the Act), or at the latest on 23 October
2012, the date on which the appellants were appointed as final trustees (the
first prescription plea).
[12] The second prescription plea, raised in the alternative, and only in respect
of the common law enrichment claims, was that all of the debts arising from
payments made to the respondents within three years prior to the date of the
Trust’s provisional sequestration (i.e. before 1 August 2009) had prescribed.
This plea relates to portions of the claims against each of the respondents (the
second prescription plea). The basis for the plea was that each payment made
sine causa gave rise to a separate claim and that the running of prescription
arose when each payment was made.
[13] The appellants replicated to the first prescription plea by alleging that:
(a)
they had obtained authority to institute proceedings against the respondents
only at the second meeting of creditors on 14 June 2013; and not in terms
of the s 18(3) order on 17 August 2012; and

4 Section 12 of the Prescription Act provides that:
(1) Subject to the provisions of subsections (2), (3), and (4), prescription shall commence to run as soon as the
debt is due.
(2) …
(3) A debt shall not be deemed to be due until the creditor has knowledge of the identity of the debtor and of the
facts from which the debt arises: Provided that a creditor shall be deemed to have such knowledge if he could
have acquired it by exercising reasonable care.

(b)
they only acquired the requisite knowledge of the identities of the
respondents and the facts from which the individual claims against the
respondents arose, on conclusion of forensic investigations into the
reconciliation of the respondents’ transactions with the Trust, after August
2013.
[14] In regard to the second plea of prescription the appellants replicated that:
(a)
at all relevant times the Trust lacked capacity; and
(b)
the knowledge of the individual trustees could not be ascribed to the Trust
because of the fraudulent role played by the controlling trustee, Mr
Pretorius.
[15] The court a quo found that the appellants obtained the necessary power to
institute proceedings in terms of the s 18(3) court order on 17 August 2012.
The appellants have not appealed that finding. Secondly, it held that the
appellants had, or could reasonably have had, the requisite knowledge to
institute action against the respondents by 23 October 2012. The challenge to
this finding forms the basis of this appeal. Having found as it did on the first
prescription plea, the court a quo did not make any findings on the second
prescription plea.
[16] The appeal raises two issues: first, whether the appellants had actual or
deemed knowledge of all the facts necessary to institute action against the
respondents by 23 October 2012; and second, if they did not, whether the
claim based on payments made before 1 August 2009 has prescribed. If the
first prescription plea is upheld, the second prescription plea becomes
academic.

[17] It is common cause, or cannot reasonably be disputed, that the appellants
knew prior to 23 October 2012 that:
(a)
the trust deed required three trustees;
(b)
only two trustees had been issued with letters of authority;
(c)
Mr Pretorius was the controlling mind of the Trust and took all decisions
to the exclusion of his co-trustee, Mr Brand;
(d)
the trustees had not exercised their powers according to the trust deed;
(e)
the investment scheme was a fraudulent Ponzi scheme;
(f)
the Trust was insolvent from inception;
(g)
the scheme was dependant, in part, on the participation of various
brokers/intermediaries, who had introduced their clients to the scheme and
had been paid commissions therefor.

[18] This knowledge to a large extent comprised the requisite facts upon which
the enrichment claim was based. The payment of commissions to the brokers
was also the basis of the statutory claims.

[19] The appellants, however, claimed that, by 23 October 2012, they did not
have full knowledge of the following facts:
(a)
the full amount paid to the respondents;
(b)
that the sums were paid as commission;
(c)
that the payments were made after commission statements had been issued.
(d)
that the scheme was a Ponzi scheme and insolvent from the outset.

[20] This last contention was belied by the affidavits deposed to in the
sequestration application and various subsequent proceedings. The founding
affidavit in the sequestration proceedings was deposed to by a partner in MB
and he said unequivocally that the liabilities of the Trust by far exceeded the

assets. The receipt of claims from investors wishing to withdraw their funds
and the inability to satisfy their claims would have confirmed that. On no less
than three occasions Ms Pieters, the second appellant deposed to affidavits in
which she described the scheme as a pyramid scheme.5

[21] It was suggested that this did not satisfy the requirements for actual
knowledge of facts as discussed in Gore,6 but it clearly did. In Gore it was
held that for the purposes of prescription, knowledge extends to a conviction
or belief that is engendered by or inferred from attendant circumstances. The
appellants may not have been 100 percent certain, but they believed on the
basis of all the information in their possession, which was considerable, that
this was a pyramid scheme and that it had always been insolvent. That was
sufficient knowledge of these facts.
Chronology of events
[22] The chronology of events presented by the appellants at the trial was
accepted by the respondents. This chronology was also succinctly laid out by
the judge in the court a quo.

[23] The appellants had access to the Group premises from 8 August 2012. They
soon became aware that the files, relating to the brokers and the commissions
earned by them, were kept by Ms Monica Goodman in a cabinet behind her
desk in the reception area at the Group premises. There were some documents

5 In her affidavit of 22 August 2012, when applying for the appellants’ powers to be extended in terms of Rule
18(3), Ms Pieters stated: ‘By virtue of the nature of the business conducted by Pretorius it is clear that he conducted
what appears to be a “pyramid scheme”. Such a scheme pays interest and dividends to investors by the
consumption of their own capital. This practice renders the “scheme” insolvent from the outset’. There are various
other affidavits by one or more of the appellants confirming this view (dated 18 September 2012, 9 October 2012,
and 10 October 2012).
6 See Minister of Finance and Others v Gore NO [2006] ZASCA 98; 2007 (1) SA 111 (SCA).

relating to the brokers which had been archived in boxes which were kept in
a room behind the reception area.

[24] When the appellants began their investigations on 8 August 2012, they
were assisted by employees of the Trust and/or the Group. Mr Brand, as a co-
trustee, (although apparently not involved in the fraudulent conduct of the
scheme) was aware of the scheme and the parties who were involved in it,
including the brokers. On 12 August 2012, the services of majority of the staff
of the Trust were terminated save for Mr Brand, Ms Swart (who was Mr
Pretorius’s personal assistant), Ms Swanepoel, and Ms Goodman. Ms
Goodman remained at the Group’s premises until 17 August 2012.

[25] The appellants appointed MB as lawyers7 and BGR de Jager Accountants
(the auditors) to assist in the investigation of the affairs of the Trust and other
related entities. In mid-August 2012, they requested an analysis of payments
made from the Trust to other entities within the Abante group, and to other
accounts held by Mr Pretorius and/or his family members. Mr Bezuidenhout,
who was working with the auditors, was charged with a forensic investigation
on the financial affairs of the Trust with initial focus on the SECA trust
(SECA), the Trading Alpha trust (TAT), the Abante trust, Mr Pretorius, and
the companies related to him.

[26] The auditors were mandated to conduct investigations on the substantial
amounts paid out from the Trust and to determine the routes of the payments
via the financial institutions. Nedbank and Standard Bank were requested to
confirm and verify account details of approximately 39 entities/trusts and

7 The appellants also appointed two other firms of attorneys to assist them in winding-up the estate.

personal accounts of Mr Pretorius and his family, and to furnish the appellants
with such documents for the purposes of the investigation.

[27] From 8 August 2012 to December 2012, the appellants’ requested the
auditors to prioritise the myriad of inter-group transactions between the
entities within the Group. Over this period, several of these entities were
sequestrated or liquidated. An Anton Piller order was obtained on 27
September 2012 to obtain documents. An anti-dissipation interdict was
obtained against several of these entities on 9 October 2012.

[28] In claiming that they could not reasonably have acquired knowledge of the
identity of the brokers and the facts from which their claims against the
brokers arose, the appellants relied on the complexity of the insolvent estate
of the Trust. They stated that they were required to investigate more than fifty
entities, in which Mr Pretorius was involved, and the inter-group transfers of
monies both locally and internationally between these entities. Over R2 billion
had been paid into the Standard Bank and Nedbank accounts, which they were
obliged to reconcile through forensic investigations. To deal with the
complexity, the appellants obtained two forensic reports detailing the
fraudulent nature of the scheme, the state of solvency of the Trust, and the date
that each payment was made by the Trust for the purposes of claims under the
Act.

[29] The investors’ claims and the inter-group transfers were prioritised by the
appellants. There was no investigation into the claims against the brokers
during 2012. On 28 January 2013, the auditors requested a meeting with the
appellants to discuss the investigations of the brokers.

[30] On 25 February 2013, the appellants requested the auditors to prepare
schedules to reflect the commission payments that the brokers received from
the Trust and also the contracts concluded with the brokers in terms of which
the commissions were paid. The auditors confirmed on the following day that
they had perused the broker files. They could not find any contracts in the
files. However, the files contained statements and proof of payment of
commissions to each of the brokers. According to the auditors, the files
relating to the brokers were, in some instances, incomplete and they were not
in chronological order. They also stated that they only received the missing
bank statements from Nedbank on 18 March 2013.

[31] In December 2013, MB followed up on the previous correspondence of
February 2013 in relation to the schedules of the brokers’ commission, to
enable them to address letters of demand to the brokers for the repayment of
the commissions and to issue subpoenas for the insolvency enquiry. By 11
February 2014, the broker files were returned to MB with the requisite details
relating to the claim against each broker. From the contents of the brokers’
files, schedules were prepared by the auditors which contained a summary of
each claim against each broker. These were attached to subpoenas issued to
brokers to attend the insolvency enquiry in April 2014. Those schedules were
utilised by the appellants to compile the annexures to the particulars of claim
in the present action.

[32] The appellants contended that the findings by the court a quo failed to
recognise that the appellants’ actions fell to be examined against the duties
and obligations required of provisional trustees in the context of the
sequestration of an extensive and potentially fraudulent investment scheme.
They submitted that the court a quo’s conclusion implied that the appellants

should have isolated and prioritised the 37 broker files amongst the many
thousands of files, and targeted them first in the course of the administration
of the estate. This, according to the appellants, ignored the scale of the
investigations required in the affairs of an insolvent estate of this complexity
and nature. In order to evaluate these submissions, an analysis of the evidence
presented at the trial is necessary.
Evidence
[33] Mr Janse van Vuuren (the tenth respondent) and Ms Goodman testified for
the respondents. Mr van Vuuren’s evidence was that he would get commission
statements every month from the Trust. Ms Goodman dealt with all broker
related enquiries and Mr Brand dealt with the situation when claw-back
payments were deducted.8 From Mr van Vuuren’s evidence, it is clear that his
file contained a commission statement, a cheque and deposit slip for every
entry on Annexure “E” to the particulars of claim, save for one.

[34] Ms Goodman took over the responsibility of maintaining the brokers’ files
from November 2008. She testified that if anyone needed to know how much
commission any broker received, they only needed to look at the broker files
or the archive files containing historic information. The documents contained
in the files relating to each broker included one or more of the following: a
deposit slip, a cheque, and/or a commission statement to evidence each
payment made to the particular broker. She and/or Mr Brand and/or the other
employees of the Trust, could have assisted the appellants to find any
documentation required. The appellants did not seek Ms Goodman’s

8 If an investor withdrew their investment before it was repayable, the broker’s commission was adjusted.

assistance in this regard – either whilst she was at the Group’s premises in
August 2012, or when she returned to work for them in February 2013.

[35] Mr Bester (the first appellant), Mr Bezuidenhout (the auditor), Mr Brand,
and Mr du Toit (the attorney of MB, dealing with the estate) testified for the
appellants. Mr Bester stated that, as provisional trustees (as opposed to finally
appointed trustees) the immediate work required was to safeguard assets and
prevent the dissipation of funds. It was not possible to deal with the claims
against the brokers until early 2013, because they were concentrating on and
prioritising other claims. He confirmed that the investigation into the 37
brokers’ files was not an insurmountable task, and when undertaken, it took a
relatively short time to be completed. Mr Bester knew from the outset that the
Trust had used brokers to procure the investments. He conceded that whilst
examining the bank statements for inter-group transactions in August 2012,
the auditors could simultaneously have accessed the payments made to the
brokers.

[36] Mr Bezuidenhout, the auditor appointed by the appellants, consulted with
Mr Brand, Ms Swanepoel, Ms Swart and Ms Pieters at the Group’s premises.
Ms Goodman was also there. He did not enquire from any of them as to the
brokers’ files, which he conceded he could have done. He received bank
statements from Standard Bank and an incomplete set from Nedbank. They
showed all monies paid out by the Trust, including amounts paid to the
brokers. Mr Bezuidenhout was working with five clerks. They prioritised the
inter-group transfers. He conceded that, even without the full set of bank
statements, there were commission statements, cheques, and deposit slips in
the broker files, which could have been reconciled and utilised to make the
claims against the brokers. Mr Bezuidenhout conceded further that he could

have complied a schedule, similar to that attached to the particulars of claim
as Annexure “E”, from the documents in the broker files without a forensic
investigation. In the case of Mr van Vuuren, it would have taken him
approximately two hours to do his.

[37] Mr Brand was fully aware of where the brokers’ files were kept and that
they contained the details of the brokers and the commissions paid to them.
He knew many of the brokers personally and had their email addresses. If
asked, he could have pointed out the brokers’ files and the archived files. He
stated that he would have been able to trace all the brokers quite easily – if he
would have been asked.

[38] Mr du Toit, a partner of MB, who was the attorney charged with the
investigation into the Trust, testified that shortly after being appointed as the
appellants’ attorneys, he consulted with them and Mr Pieters from Duvenhage
and Cilliers attorneys, who were also assisting with the estate. The initial focus
was on the recovery of assets belonging to the Trust and not the brokers. Mr
du Toit conceded that all the questions which Mr Brand was asked at the
insolvency enquiry in February 2013, relating to the broker files could have
been asked of Mr Brand in August 2012. Had he enquired from Mr Brand or
Ms Goodman about the commission claims of the brokers, when first
appointed in August 2012, that information would have been forthcoming. Mr
du Toit stated quite frankly that the information was all there in the files and
had he, the trustees or the auditors opened the files and looked at their contents,
the information would have been available to them.

[39] As will appear from what had been stated above, the respondents did not
rely upon actual knowledge. They contended that, through the exercise of

reasonable care, the appellants could have established the requisite facts in
order to institute action.

The Law
[40] In terms of s 12(1) of the Prescription Act, prescription begins to run as
soon as the debt is due. A debt is due when it is immediately claimable or
recoverable. If the debtor has knowledge of the identity of the debtor and of
the facts from which the debt arises, the debt is deemed to be due, as by that
stage, the creditor acquires a complete cause of action for the recovery of the
debt. In terms of s 12(3) of the Prescription Act, the creditor is deemed to have
knowledge of the identity of the debtor and of the facts from which the debt
arises if it could have been acquired by the exercise of reasonable care.9

[41] The  knowledge required relates to the factual ingredients giving rise to the
debt and not knowledge of the legal conclusions.10 The requisites of such
knowledge were described in Gore.11 Whilst mere ‘opinion and supposition’
is not sufficient,12 a belief that is inferred from the circumstances of the case,
as well as from information received from employees and/or agents, or those
assisting the trustees, can be imputed to the trustees.

9  Road Accident Fund and Another v Mdeyide (CCT 10/10) [2010] ZACC 18; 2011 (1) BCLR 1 (CC) ; 2011 (2)
SA 26 (CC) (30 September 2010) para 13 (citations omitted); Standard Bank of South Africa Ltd v Miracle Mile
Investments 67 (Pty) Ltd and Another [2016] ZASCA 91; 2017 (1) SA 185 (SCA) para 24, citing Truter and
Another v Deysel [2006] ZASCA 16; 2006 (4) SA 168 (SCA) para 16.
10 Truter v Deysel (note 9 above). Van Staden v Fourie 1989 (3) SA  200 (A) at 216B-F.
11 Gore NO (note 6 above).
12 Gore NO (note 6 above) para 18.

[42] Prescription starts to run when the creditor has knowledge of the requisite
facts (whether actual or imputed) or when the creditor is deemed to have the
requisite knowledge of the facts underlying the action. As stated in Gore:
‘The running of prescription is not postponed until the creditor becomes aware of the full
extent of its legal rights, nor until the creditor has evidence that would enable it to prove
the case comfortably.’13
The creditor is also not permitted to postpone prescription through his own
inaction. As stated by Van den Heever J in Benson and Another v Walters and
Others14:
‘Our Courts have consistently held that a creditor is not able by his own conduct to
postpone the commencement of prescription.’ This approach was confirmed in The
Master v I L, Back & Co Ltd where Galgut AJA stated:
‘A creditor's right of action is not postponed until such time as he may, either in his wisdom
or when he thinks he ought to, bestir himself.’15

[43] In regard to the requirement of reasonable care, this court stated in Drennan
Maud & Partners v Pennington Town Board16:
‘…[T]he requirement “exercising reasonable care” requires diligence not only in the
ascertainment of the facts underlying the debt, but also in relation to the evaluation and
significance of those facts. This means that the creditor is deemed to have the requisite
knowledge if a reasonable person in his position would have deduced the identity of the
debtor and the facts from which the debt arises.’

[44] The principles relating to prescription are applicable to trustees and
liquidators. The respondents contended that the appellants should not be

13 See Gore NO (note 6 above) with reference to Van Staden v Fourie 1989 (3) SA 200 (A) at 216B-F and Nedcor
Bank Bpk v Regering van die Republiek van Suid-Afrika 2001 (1) SA  987 (SCA) paras 11 and 13.
14 Benson and Another v Walters and Others 1981 (4) SA 42 (C) at 49G-H, as quoted in Uitenhage Municipality
v Molloy 1998 (2) SA 735 (SCA) at 742A–C.
15 The Master v I L, Back & Co Ltd 1983 (1) SA 986 (A) at 1005G-H.
16 Drennan Maud & Partners v Pennington Town Board 1998 (3) SA 200 (SCA) at 209F–G.

treated any differently to any other creditor which, in terms of Prescription
Act, needs to institute the action within three years of the debt being due.17
The appellants did not suggest otherwise.

Discussion
[45] The appellants’ approach was not that the facts on which these claims were
based were inaccessible or hard to ascertain. It was that, given the size and
complexity of the insolvency process in regard to the Trust, their failure to
investigate the claims did not amount to a failure to exercise reasonable care
to acquire knowledge of the identity of the brokers and the facts giving rise to
the claims against them.

[46] The judge did not make any adverse credibility findings against Mr Bester
or Messrs Bezuidenhout and Du Toit concerning their actual state of
knowledge. All conceded that they focussed on other matters and did not come
to deal with the brokers and the payment of commissions until 2013. As a
result, it was only in 2013 that they acquired actual knowledge of the details
of these claims and the identity of the brokers. The question is whether by the
exercise of reasonable care this would have been ascertained at an earlier stage
prior to 23 October 2012.

17 Duet and Magnum Financial Services CC (in liquidation) v Koster (168/09) [2010] ZASCA 34 (29 March
2010); 2010 (4) SA 499 (SCA); Off-Beat Holiday Club and Another v Sanbonani Holiday Spa Shareblock Ltd
and Others 2017 (5) SA 9 (CC) para 10; Makate v Vodacom Ltd [2016] ZACC 13; 2016 (4) SA 121 (CC) para
196.

[47] In regard to knowledge which might have been obtained from Mr Brand,
Ms Goodman, Ms Swanepoel or Ms Swart, the appellants contended that, in
order for that knowledge to be imputed to them, the knowledge would have to
have been acquired by the agent in the course of their employment with the
principal, and a duty must rest upon the agent to communicate the information
to his principal.18  These persons undoubtedly had actual knowledge of the
existence and identity of the brokers and the whereabouts of detailed
information concerning the commissions paid to them. The question is
whether the appellants should, in the exercise of reasonable care have asked
them to provide that information in order to consider whether a claim for
recovery should be made. The question must be answered in the affirmative.
The fact is that they did not do so for the simple reason that they prioritised
other issues.

[48] The prioritisation of other issues cannot be a reason for not exercising
reasonable care to ascertain the facts giving rise to a debt. Trustees and
liquidators cannot select the issues on which to concentrate in their
administration, secure in the knowledge that a plea of prescription could be
defeated by a claim of ignorance accompanied by the excuse that they were
prioritising other more important matters. That would be contrary to the
principle that a creditor cannot by their own actions postpone the
commencement of the running of prescription.

[49] The appellants were well aware that the funds invested in the Trust had
been secured largely through the efforts of brokers who were paid
commissions. Given the amount of money involved those commissions would
on any basis be substantial. The claim chosen as the test case was for over

18 Wilkins v Potgieter NO and Another 1996 (4) SA 936 (T) at 939F-H.

R5 million. They were aware for the reasons already given that these funds
had been invested in a pyramid scheme and that the entire edifice had
collapsed when Mr Pretorius committed suicide and the Trust was almost
immediately sequestrated. They knew, because they had the trust deed, that
there were only two trustees, whereas three were required, and Mr Brand had
told them that effectively Mr Pretorius was the sole decision-maker. Ms
Pieters confirmed in an affidavit that the appellants were aware of the
provisions of the Act dealing with the dispositions and the potential to set these
aside. The commissions were manifestly dispositions by the Trust.

[50] These facts were all known to the appellants and constituted the facts from
which the debts arose, whether the legal basis was a condictio sine causa or
the dispositions under the Act. The appellants and those assisting them had
not opened the brokers' files; thus they did not know the names of the brokers
or how much had been paid to each of them. The moment the files were opened
and examined, this information was available.

[51] The appellants’ explanation that they prioritised other matters
demonstrates that they could not show that they exercised reasonable care in
ascertaining the information giving rise to the claims and the identity of the
debtors. It, in fact, shows a deliberate decision not to investigate and ascertain
the existence of relatively obvious claims. They chose to run a risk of not being
able to commence proceedings timeously. As it happens in two cases to which
we were referred they did sue timeously and succeeded. They simply did not
do that in relation to these claims.

[52] The appeal involves, in the main, a challenge to the factual findings made
by the court a quo, namely that the court erred in its assessment of the facts in

concluding that the appellants could reasonably have established, by 23
October 2012, that which was required in order to institute action against the
respondents. It has been held by this Court that:
‘The approach to be adopted by a court of appeal when it deals with the factual findings
of a trial court is trite. A court of appeal will not disturb the factual findings of a trial court
unless the latter had committed a material misdirection. Where there has been no
misdirection on fact by the trial Judge, the presumption is that his conclusion is correct.
The appeal court will only reverse it where it is convinced that it is wrong. In such a case,
if the appeal court is merely left in doubt as to the correctness of the conclusion, then it
will uphold it. This court in S v Naidoo & others reiterated this principle as follows:
“In the final analysis, a court of appeal does not overturn a trial Court’s findings of fact
unless they are shown to be vitiated by material misdirection or are shown by the record
to be wrong.”’19 (Footnotes omitted).

[53] The appellants did not point to any factual error in the judge's reasoning.
Instead they said that by not placing sufficient weight on their evidence
concerning the complexity of the process of winding up the Trust, the judge
imposed an unreasonable burden on them in relation to the ascertainment of
the facts giving rise to the claims against the brokers. The conclusion reached
by the court a quo and the findings of fact relied upon cannot be faulted. The
appeal must accordingly fail.
Costs relating to the record
[54] It is unfortunately necessary to make certain comments about the record in
this matter. The record ran to some 1870 pages, a fair portion of which, as
counsel conceded at the hearing of the matter, was irrelevant to the issues in
the appeal. In the appellant’s practice note, the Court was advised that it was
necessary to read the entire record. The respondents, in their practice note

19 Mkhize v S [2014] ZASCA 52 para 14 (Citations omitted).

stated that the parties had attempted to restrict the record to that which was
relevant to the appeal. Both these statements were inaccurate. This practice is
not confined to the present appeal. The rules of this Court, relating to the
preparation of records by attorneys and the practice directive relating to the
filing of a practice note by counsel, specifying the portions of the record that
counsel regards as necessary to be read, continue to be ignored.

[55] In Van Aardt v Galway20 this Court dealt with the persistent problem of
legal representatives failure to comply with the rules of this Court. Wallis JA
held:
‘[34]
Turning to the practice note, rule 10A(ix) enjoins counsel to provide a list
reflecting those parts of the record that in the opinion of counsel are necessary for the
determination of the appeal. The purpose of this provision was spelled out by Harms JA in
Caterham Car Sales & Coachworks Ltd v Birkin Cars (Pty) Ltd and Another21:
“The object of the note is essentially twofold. First, it enables the Chief Justice in settling
the roll to estimate how much reading matter is to be allocated to a particular Judge. Second,
it assists Judges in preparing the appeal without wasting time and energy in reading
irrelevant matter. Unless practitioners comply with the spirit of this requirement, the objects
are frustrated and this in turn leads to a longer waiting time for other matters.”  …
[35] …
[36] The practice note requires a statement of counsel’s view, in the form of a list,
of those parts of the record that need to be considered in order to decide the case. The fact
that his or her opponent may disagree is neither here nor there. That will emerge from the
opponent’s practice note. In addition, the list is to be confined to those parts of the record
that are ‘necessary’ for that purpose. ... The list should include only those parts of the record

20 Van Aardt v Galway 2012 (2) SA 312 (SCA) paras 31-39.
21 Caterham Car Sales & Coachworks Ltd v Birkin Cars (Pty) Ltd & another 1998 (3) SA 938 (SCA) para 36.

that counsel is likely to refer to either in support for the argument, or for rebuttal, or to
highlight flaws in the judgment appealed against…’
[56] In the present matter, it appears that it was unnecessary for this Court to
read approximately 40% of the record. In my view, 40% of the costs incurred
in the preparation, perusal and copying of the record should be disallowed.
Despite previous admonitions by this court, the rules continue to be ignored.
It is hoped that these remarks, may serve as a warning to practitioners in future
proceedings.

[57] The following order is made:
The appeal is dismissed with costs, including the costs occasioned by the
employment of two counsel, save that the costs of the preparation, perusal
and copying of the record shall be limited to 60% of the costs incurred in
those tasks.

______________________

WEINER AJA

ACTING JUDGE OF APPEAL

APPEARANCES

For appellant:

JA Van Der Merwe SC (with him BC Wharton)

Instructed by:

Mostert & Bosman Attorneys, Bellville

Phatshoane Henney Attorneys, Bloemfontein.

For Respondents:
RGL Stelzner SC (with him M Daling)

Instructed by:

Laas & Scholtz Incorporated, Durbanville

Webbers Attorneys, Bloemfontein.

SUPREME COURT OF APPEAL OF SOUTH AFRICA
MEDIA SUMMARY OF THE JUDGMENT DELIVERED
MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME
COURT OF APPEAL
FROM

The Registrar, Supreme Court of Appeal

DATE

17 December 2020

STATUS

Immediate

Please note that the media summary is intended for the benefit of the media
and does not form part of the judgment of the Supreme Court of Appeal.

Bester and Others NNO v Gouws and Others (851/2019) [2020] ZASCA 174
December 2020
________________________________________________________________

Today the Supreme Court of Appeal (SCA) dismissed the appeal by the
appellants against the judgment of the Western Cape Division of the High Court,
Cape Town.
Mr Herman Pretorius had operated a fraudulent Ponzi scheme, through the RVAF
Trust, which collapsed when he committed suicide. The Trust was sequestrated.
The appeal involved the question of whether claims, brought by the appellants,
as trustees of the insolvent estate of the Trust, to recover commissions paid to
brokers who solicited those investments, had prescribed.

The provisional sequestration order was granted on 1 August 2012. The
appellants were appointed as provisional trustees on 7 August 2012. On
17 August 2012, the appellants obtained an order granting them the necessary
power to institute legal proceedings in terms of s 18(3) of the Act. They were
appointed final trustees on 23 October 2012.
The respondents were all investment brokers recruited by Mr Pretorius. Together
with the brokers, Mr Pretorius succeeded in enticing investors to invest huge
amounts in his scheme on the basis that it would yield returns far exceeding those
achieved by conventional established institutions.
The appellants instituted action against the respondents claiming repayment of
the commissions earned by them on the investments. The actions were instituted
on two bases: under the common law (on the basis of unjust enrichment);
alternatively, under s 26 and s 32 of the Insolvency Act. The respondents raised
two pleas of prescription. Only the first was relevant to the appeal. It was
premised on s 12 (3) of the Prescription Act, which provides that a debt becomes
due when a creditor has knowledge of the identity of the debtor and of the facts
from which the debt arises, provided that a creditor shall be deemed to have such
knowledge if he could have acquired it by exercising reasonable care.  The issue
was whether the appellants had, or should have had the requisite knowledge under
s 12(3) by 17 August 2012 or, at the latest, by 23 October 2012 (the date on which
the appellants were appointed as final trustees) to institute action against the
respondents.
The high court found that the appellants obtained the necessary power to institute
proceedings in terms of the s 18(3) court order on 17 August 2012. The appellants
did not appeal that finding. Secondly, it held that the appellants had, or could
reasonably have had, the requisite knowledge to institute action against the

respondents by 23 October 2012. The challenge to this finding formed the basis
of the appeal.
The appeal court found that by 23 October 2012, the trustees should, through
reasonable care, have known that the investment scheme was a fraudulent Ponzi
scheme; that the Trust was insolvent from inception; that the scheme was
dependant on the participation of the brokers, who had introduced their clients to
the scheme and had been paid commissions therefor; and what amounts were paid
to the brokers as commissions. The knowledge of these facts comprised the
requisite facts upon which the enrichment and the statutory claims were based.
The finding was based upon the following. The appellants had access to the
premises from which the Trust operated from 8 August 2012. Soon thereafter they
became aware that the files relating to the brokers and the commissions earned
by them, were under the control of an employee who would have been able to
provide all the necessary information relating to the claims against the brokers.
The trustees however made a decision to prioritise the investors’ claims and the
inter-group transfers. There was no investigation into the claims against the
brokers during 2012. The auditors and the trustees only began the investigations
of the claims against the brokers in January 2013.  They instituted action in
November 2015, more than three years after the cut-off date, being 23 October
2012.
It was held that a creditor is not permitted to postpone prescription through his
own inaction The requirement of reasonable care requires diligence in
ascertaining the facts underlying the debt as well as an evaluation of the
significance of those facts. The question is whether by the exercise of reasonable
care, the relevant facts necessary to institute action against the respondents should
have been ascertained, by 23 October 2012.

The court held that the prioritisation of other issues cannot be a reason for not
exercising reasonable care to ascertain the facts giving rise to a debt. The
appellants’ explanation that they prioritised other matters shows that they failed
to exercise reasonable care in ascertaining the information giving rise to the
claims against and the identity of the respondents.
The plea of prescription was thus upheld and the appeal was dismissed with costs.
The court found it necessary to comment on the persistent failure by attorneys
and counsel to comply with rule 10A(ix) of the Supreme Court Rules which
enjoins counsel to provide a list reflecting those parts of the record that in the
opinion of counsel are necessary for the determination of the appeal. The
appellants’ practice note stated that the entire record should be read. The record
comprised some 1870 pages. Approximately 40 percent of the documents in the
record were irrelevant to the issue in the appeal. The court thus ordered that 40
percent of the costs incurred in the preparation, perusal and copying of the record
should be disallowed.