THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA

Reportable

CASE NO: 27/2004

In the matter between :

NISSAN SOUTH AFRICA (PTY) LIMITED
Appellant

and

MARNITZ, NADIA N.O.
First Respondent
KEEVY, KAREN N.O.
Second Respondent
FIRSTRAND BANK LIMITED
Third Respondent

and

STAND 186 AEROPORT (PTY) LIMITED
Intervening Party

_____________________________________________________________________________
Before:
STREICHER, NUGENT, CONRADIE JJA, PATEL & PONNAN AJJA
Heard:
17 SEPTEMBER 2004
Delivered:
1 OCTOBER 2004
Summary:
Banking – mistaken transfer of money into incorrect bank account –
accountholder not entitled to money.
______________________________________________________________________________

J U D G M E N T
______________________________________________________________________________

STREICHER  JA

STREICHER JA:
[1] What are the consequences of mistakenly transferring money to an
incorrect bank account? That is the question that arises for decision in this
appeal.
[2] The appellant is a customer of the third respondent (‘FNB’). On 31
December 2002 it instructed FNB to make certain payments to its creditors.
One such creditor was TSW Manufacturing. Insofar as TSW was
concerned FNB was instructed to pay an amount of R12 767 468,22 to
Standard Bank account number 0202216657. However, that account was
the account of Maple Freight CC (‘Maple’). Due to a clerical error the
wrong banking details had been furnished. The appellant did not owe
Maple any amount and had no intention of paying any amount to Maple.
[3] As a result of the erroneous instruction an amount of R12 767 468,22
was, on 31 December 2002, transferred by FNB from the appellant’s
account to Maple’s account at Standard Bank. Shortly thereafter Maple
became aware of the deposit into its account. It immediately realised that it
had been made by mistake. One would have thought that it would have
been obvious to Maple as to what should be done in the circumstances.
However, that was not the case. Maple considered it necessary to obtain
legal advice as to what its position was as recipient of the funds. Quite
surprisingly it was advised that the amount should be transferred to a call
account, that it was entitled to the interest earned on the funds and that the
amount transferred would eventually have to be repaid on demand.

[4] In terms of a factoring agreement Maple had a receipts as well as
payments account with FNB. Payments and transfers could not be made
from the receipts account to any account other than the payments account.
On 2 January 2003 Maple transferred an amount of R12 700 000 from its
Standard Bank account to its FNB receipts account. It has not been
explained why, if the intention was to follow the legal advice obtained, the
call account had not been opened at that stage and the amount had not been
paid into that account. On 2 January 2003 R12 700 000 was withdrawn
from the receipts account and on 3 January 2003 R9 750 000 thereof was
deposited into the payments account. On 6 January 2003 a further amount
of R3 250 000 was deposited into the payments account.
[5] After payment into the FNB receipts account one Stanley, the sole
member of Maple, instructed Maple’s accountant to open a call account
and to place the amount of R12 700 000 into that account. These
instructions were conveyed to FNB and a call account was opened on 7
January 2003. According to Stanley the funds had been transferred from
the receipts account to the payments account to permit them to be
transferred to the call account. He does not explain the discrepancy
between the amount debited to the receipts account on 2 January and the
amount credited to the payments account on 3 January.
[6] However, the funds were never transferred to the call account, due,
according to Stanley, to an error on the part of FNB. According to FNB it
was never instructed to transfer funds to the call account but was told that

Maple would do so electronically. In the meantime, unbeknown to Stanley,
so he says, the funds were being utilised in conducting the day-to-day
business of Maple.
[7] On 20 January 2003 when TSW made enquiries about the amount
that should have been paid to it by 31 December 2003, the appellant
became aware of the erroneous payment. The appellant thereupon
demanded return of the funds. Maple indicated that it was prepared to
comply with the demand subject to it retaining the interest earned thereon
and a lavish 'administration fee' of 4% of the amount concerned.
[8] According to Stanley, Maple was on or about 23 January 2003 ‘in a
position to pay the monies over’ to the appellant but then discovered that
FNB had omitted to transfer the monies to the call account. Upon this
discovery he drew three cheques in favour of the appellant but before the
cheques could be deposited into the appellant’s account the appellant
obtained a court order freezing Maple’s banking facilities. This step,
according to Stanley, put Maple under considerable financial strain and
resulted in him as the only member of Maple, resolving that the corporation
be wound up voluntarily. The first and second respondents were appointed
as liquidators. It apparently did not occur to Stanley that the appellant
would agree to waive its rights in terms of the court order against
repayment of the funds.
[9] As at 23 January 2003 the credit balance on the payments account
was R10 558 818,05. It would, therefore, appear that Maple was in fact not

in a position to pay the monies over to the appellant as alleged by Stanley.
The first and second respondents contend that the total amount of
R10 558 818,05 forms part of the insolvent estate of Maple and is subject
to a concursus creditorum. The appellant contends that at least the
R9 750 000 which can be traced to the amount transferred from its account
to Maple’s account, does not form part of the insolvent estate. By
agreement between the parties the amount of R10 558 818.05 was, on 20
February 2003, transferred to a bank account under the control of the first
and second respondents where it is being held pending the present
proceedings.
[10] Having obtained the interim interdict the appellant applied to the
Witwatersrand Local Division for an order:
(a)
Declaring that the amount of R9 750 000 and any interest that
accrued thereon from 20 February 2003 did not form part of the
insolvent estate of Maple Freight CC (in liquidation); and
(b)
Directing the first and second respondents to pay the amount to the
appellant alternatively FNB.
Stand 186 Aeroport (Pty) Ltd (‘the intervening party’) subsequently, with
the leave of the court a quo, intervened as a party to the proceedings.
Stanley is its sole director and shareholder.
[11] Mailula J held that Maple and not FNB was enriched by the transfer
of the funds and that the appellant, therefore, did not have a claim against
FNB but had a concurrent claim against the insolvent estate of Maple. In

the result the court a quo dismissed the application with costs. With the
necessary leave the appellant now appeals against the court a quo’s
judgment.
[12] Counsel for the appellant submitted that, because there was no
intention on its part to pay Maple, Maple had no entitlement as against
Standard Bank to the funds transferred to Standard Bank. They contended,
furthermore, that since Maple had no entitlement to the funds as against
Standard Bank it could not acquire a greater title as against FNB by
transferring the funds to another account with that bank. The first and
second respondents, on the other hand, submitted that when Standard Bank
unconditionally credited the funds received to Maple’s account it became
obliged to pay the amount so credited to Maple. They submitted that that
was the position even if Maple acquired the funds by way of theft or fraud.
In this regard, they relied on Malan and Pretorius Malan on Bills of
Exchange, Cheques and Promissory Notes 4 ed at 341; Commissioner,
South African Revenue Service, and Another v Absa Bank Ltd and Another
2003 (2) SA 96 (W) at 129E-131G in which the decision in Commissioner
of Customs and Excise v Bank of Lisbon International Ltd and Another
1994 (1) SA 205 (N) is criticised; and on Take and Save Trading CC and
Others v Standard Bank of SA Ltd 2004 (4) SA 1 (SCA).
[13] In Bank of Lisbon money was fraudulently obtained by one of the
respondents (‘Reob’) from the Commissioner of Customs & Excise by way
of cheques which were deposited into Reob’s bank account with the Bank

of Lisbon. Thirion J held that ‘the circumstances under which Reob
obtained the moneys . . . were such as to deprive delivery to Reob of any
legal effect’. 1 He held, furthermore, that the ownership of the money, being
res fungibiles, and the bank having received it without reason to believe
that it had been stolen or obtained by fraud, passed to the bank when it was
paid into the account with the bank.2 For that reason, the money could not
be reclaimed by a vindicatory action.3 The Bank of Lisbon argued that the
Commisioner’s only remedy was to obtain judgment against the thief,
Reob, and then to levy execution against any claim which the thief may
have against the bank in respect of any credit balance in his bank account.
Thirion J was of the view that our law would be gravely deficient if it did
not provide a better remedy to a party in the position in which the
Commissioner found himself.4 He proceeded to find that the actio Pauliana
and also the condictio sine causa were such better remedies.5 In regard to
the actio Pauliana he said:6
‘It would appear to me moreover that the actio Pauliana finds application in a
case such as the present where the debtor pays into his bank account moneys which he
has obtained by fraud and which moneys, on being paid into the Bank, become the
property of the Bank. When Reob obtained the moneys by fraud from the
Commissioner it became indebted to the Commissioner in the amount so obtained and
became obligated to the Commissioner to repay him a like amount. By paying the

1 At 208G
2 At 208I
3 At 208H-I
4 At 209A-B
5 At 213H-215A
6 At 213H

moneys to the Bank, Reob diminished its assets which were available to pay its debt to
the Commissioner.’
[14] Malan and Pretorius say in respect of this decision that since there
was no agreement between the parties as to the purpose for which the
cheques were given, no contract came about between them on the
instrument.7 The Commissioner could have recovered the cheques by way
of rei vindicatio or, after payment of the cheques, the amount paid, on the
ground of enrichment or as damages. The specific passage relied upon by
the first and second respondents reads as follows8:
‘The crucial fact is that the respondent bank is obliged, in terms of the bank and
customer contract subsisting between it and the company, to pay cheques of the
company drawn on it or repay the amount standing to the credit on the account to the
company on demand. This contract is neither invalid nor illegal but enforceable by the
company or its liquidator. To allow the Commissioner to claim the amount standing to
the credit of the company would, at best, deprive the company or the general body of
creditors of this asset or at worst, force the respondent bank to pay the same amount
twice! There is, surely, no room for an action by the Commissioner against the
respondent bank, whether this be the actio Pauliana or a condictio sine causa.’
Both an interdict and attachment are according to Malan and Pretorius
adequate remedies available without the need for judgment against the thief
first having been obtained.9
[15] In Commissioner of Customs and Excise v Bank of Lisbon
International Ltd Van der Nest AJ stated that he shared Malan and

7 Op cit 338
8 At 341
9 Op cit 341

Pretorius’s criticism of the judgment in Bank of Lisbon. In his view the
duty of the Bank of Lisbon to repay the amount deposited and to honour
cheques and withdrawals whilst the account was in credit was unaffected
by the initial fraud perpetrated on the Commissioner. By paying the funds
into its account Reob acquired a personal claim against the bank.10
[16] I agree with Thirion J that our law would be deficient if it did not
provide a remedy for recovery of stolen money direct from the bank which
received that money to the credit of the thief’s account, for as long as the
amount stands to the credit of the thief. The interdict and attachment that
according to Malan and Pretorius, are adequate remedies are what have
been described as Mareva-type injunctions which are available to a creditor
to prevent his debtor, pending an action instituted or to be instituted by the
creditor, from getting rid of his assets to defeat his creditors.11 However,
such interdicts and attachments are not adequate remedies in the event of
the insolvency of the debtor.
[17] In my view, having found that delivery of the money to Reob did not
have any legal effect, it was not necessary in Bank of Lisbon to resort to the
actio Pauliana. For this reason and also because the appellant did not in the
present case rely on the actio Pauliana it is not necessary to deal with the
question whether there was any room for the application of the action in
that case.

10 At 129G-130A
11 See Malan and Pretorius op cit 337

[18] Courts often grant interim interdicts against persons in respect of
allegedly stolen money paid into a bank account of the alleged thief and
against the bank concerned, pending an action to determine whether the
money had been stolen. (See Lockie Bros Ltd v Pezaro 1918 WLD 60; and
First National Bank of Southern Africa Ltd v Perry NO and Others 2001
(3) SA 960 (SCA) at para 18). The banks usually do not oppose the
application for such interdicts but adopt the stance of a stakeholder and
await a decision of the court as to whether the money was stolen and as to
who is entitled to it.
[19] Malan and Pretorius are, therefore, not correct insofar as their view
would seem to be that these interdicts can only be granted on the basis
upon which Mareva-type injunctions are granted. In Lockie Bros the
dispute was whether the deposit which gave rise to the credit on fixed
deposit with the African Banking Corporation in respect of which the
interdict was granted consisted of stolen money and not whether the
respondent should be prevented from getting rid of his assets so as to defeat
his creditors. In Perry Schutz JA stated that he was aware of doubts
expressed as to the correctness of the decision but that he considered it to
have been correctly decided. He added: 12 ‘What an applicant must do in
such a case is to trace the money back to the stolen money, to identify it as
a “fund” of stolen money in the defendant’s hands.’

12 At 968E

[20] Perry was an appeal against an order upholding exceptions against
FNB’s particulars of claim. In the particulars of claim it was alleged that a
stolen and forged cheque was paid into the account of FPV, a firm of
stockbrokers, with FNB. One Dambha who had a managed account with
FPV represented to FPV that he was entitled to the proceeds of the cheque.
In consequence Dambha’s account was credited with the proceeds.
Thereafter, Dambha instructed FPV to make out and hand to him three
cheques, two of which, made out to himself and a trust, were deposited
with Nedbank to the credit of himself and the trust respectively. The issue,
insofar as the one respondent, Nedbank, was concerned, was whether FNB,
or FNB as cessionary of FPV’s claim, could recover from Nedbank the
stolen money that had been deposited with Nedbank.13 Insofar as Dambha
and the liquidators of the trust were concerned, FNB sought a declaration
that they had no right to the respective funds credited to their accounts.
Schutz JA held that the funds deposited into the accounts with Nedbank
were stolen money. But, referring to the rule that once money is mixed with
other money without the owner’s consent, ownership in it passes by
operation of law, he stated that it followed that when payment was made of
the two cheques payable to Dambha and the trust, ownership of the money
passed to Nedbank. In the result the rei vindicatio, which is an assertion of
ownership, was not available to FNB.14 He then considered whether the

13 At 964J
14 At para 16

stolen money could be recovered by way of an enrichment action. In this
regard, he stated that if Nedbank was obliged to account to its customer in
respect of the money received it would not be enriched and there would not
be an enrichment action against it.15 Assuming that Nedbank was not
obliged to do so and that it was enriched, Schutz JA held that the money
could be recovered from Nedbank by way of an enrichment action.
[21] Schutz JA then dealt with the question whether Nedbank was obliged
to account to its customers. Relying on Absa Bank Ltd v Standard Bank of
SA Ltd 1998 (1) SA 242 (SCA) at 252, he stated that the act of crediting a
customer in a bank’s books did not in itself create a liability, because the
credit could have been wrongly made and could be reversed. Insofar as the
thief, Dambha, was concerned, he held that, on the allegations made against
him, there could be no question of Dhamba having a claim against
Nedbank.16 In other words the thief who deposited the amount into his
account with Nedbank, had no claim against Nedbank for the payment of
the amount standing to his credit.
[22] In Take and Save Trading CC and Others v Standard Bank of SA Ltd
Harms JA said that once an amount is transferred by A to the credit of B’s
bank account the credit belongs to B and the bank cannot on the
instructions of A retransfer it without the concurrence of B.17 The statement
must be read in its context. The court was dealing with a valid transfer of

15 At para 19
16 At 972C
17 At 9B-C

funds from A’s account to B’s account in payment of cigarettes to be
delivered and actually delivered after such transfer. The transfer could
obviously not be reversed without B’s consent.
[23] It follows that the submission by first and second respondents’
counsel that once a bank has unconditionally credited a customer’s account
with an amount received, the bank is required to pay the amount to the
customer on demand, even where the customer came by such money by
way of fraud or theft, is not correct. If stolen money is paid into a bank
account to the credit of the thief the thief has as little entitlement to the
credit representing the money so paid into the bank account as he would
have had in respect of the actual notes and coins paid into the bank account.
[24]  It is now necessary to consider to what extent, if any, the position of
Maple as against FNB differed from Dambha’s position as against
Nedbank. Payment is a bilateral juristic act requiring the meeting of two
minds (Burg Trailers SA (Pty) Ltd  and Another v Absa Bank Ltd and
Others 2004 (1) SA 284 (SCA) at 289B). Where A hands over money to B
mistakenly believing that the money is due to B, B, if he is aware of the
mistake, is not entitled to appropriate the money. Ownership of the money
does not pass from A to B. Should B in these circumstances appropriate the
money such appropriation would constitute theft (R v Oelsen 1950 (2) PH
H198; and S v Graham 1975 (3) SA 569 (A) at 573E-H). In S v Graham it
was held that if A mistakenly thinking that an amount is due to B gives B a
cheque in payment of that amount and B, knowing that the amount is not

due, deposits the cheque, B commits theft of money although he has not
appropriated money in the corporeal sense. It is B’s claim to be entitled to
be credited with the amount of the cheque that constitutes the theft. This
court was aware that its decision may not be strictly according to Roman-
Dutch law but stated that the Roman-Dutch law was a living system
adaptable to modern conditions. As a result of the fact that ownership in
specific coins no longer exists where resort is made to the modern system
of banking and paying by cheque or kindred process this court came to
regard money as being stolen even where it is not corporeal cash but is
represented by a credit entry in books of account.18
[25] The position can be no different where A, instead of paying by
cheque, deposits the amount into the bank account of B. Just as B is not
entitled to claim entitlement to be credited with the proceeds of a cheque
mistakenly handed to him, he is not entitled to claim entitlement to a credit
because of an amount mistakenly transferred to his bank account. Should
he appropriate the amount so transferred, ie should he withdraw the amount
so credited, not to repay it to the transferor but to use it for his own
purposes, well knowing that it is not due to him, he is equally guilty of
theft.
[26] In this case FNB, as agent of the appellant, intended to effect
payment to TSW, and Standard Bank, as agent of Maple, intended to
receive payment on behalf of Maple. There was no meeting of the minds.

18 At 576E-H

In these circumstances, Maple, did not become entitled to the funds
credited to its account. Any appropriation of the funds by Maple, with
knowledge that it was not entitled to deal with the funds, would have
constituted theft. The transfer of the funds to the receipts account and
thereafter to the payments account of Maple did not change Maple’s
position concerning those funds. Just like Standard Bank, FNB received
funds to which Maple was not entitled. An appropriation of these funds by
Maple, with knowledge that it was not entitled to the funds, would likewise
have constituted theft thereof. The first and second respondents,
consequently, have no claim against FNB in respect of the funds.
[27] It was common cause that, in the event of it being found that the first
and second respondents were not entitled to the funds, the appellant was
entitled to payment thereof.
[28] Counsel for the first and second respondents submitted that to hold
that a bank in FNB’s position is not liable to pay the amount standing to the
credit of a customer in Maple’s position would be destructive of banking
practice. They submitted that it would mean that in respect of each
customer and each transaction, a commercial bank would have to ascertain
where the customer’s funds came from and the reason therefore and why
such funds were being paid to a named payee. I do not agree. The claim
against the bank is based on enrichment. If the bank upon the instructions
of its customer, without knowledge of the customer’s defective title,
transfers or pays the amount mistakenly received to a third party an

enrichment action against the bank would not succeed. If a third party
claims to be entitled to the money deposited with the bank, the bank need
not investigate the matter but may adopt the stance of a stakeholder. It
would be well advised to adopt such a stance. Should the bank in such an
event unilaterally reverse the credit to the customer’s account it would be
doing so at its peril.
[29] In the result the following order is made:
The appeal is upheld with costs including the costs of two
counsel. Such costs are to be paid by the first and second
respondents and the intervening party jointly and severally.
The order of the court a quo is set aside and replaced with the
following order:
‘1
It is declared that the amount of R9 750 000 and any
interest that accrued thereon from 20 February 2003,
which is subject to the attachment order issued under case
number 2003/1508 and transferred by consent to an
account under the control of the first and second
respondents, does not form part of the insolvent estate of
Maple Freight CC (in liquidation).
The first and second respondents are directed to release
the amount of R9 750 000 and any interest that accrued
thereon from 20 February 2003, as referred to in para 1
above, to the applicant.

The first and second respondents and the intervening
party jointly and severally are ordered to pay the
applicant’s costs including the costs of two counsel.’

____________________
P E STREICHER
JUDGE OF APPEAL

NUGENT JA)
CONRADIE JA)
PATEL AJA)
CONCUR
PONNAN AJA)