THE SUPREME COURT OF APPEAL OF SOUTH AFRICA

JUDGMENT

Case no: 132/09
In the matter between:

VIV’S TIPPERS (EDMS) BPK

Appellant

and

PHA PHAMA STAFF SERVICES (EDMS) BPK
h/a PHA PHAMA SECURITY

Respondent

Neutral citation:
Viv’s Tippers v Pha Phama Staff Services (132/09)
[2010] ZASCA 26 (25 March 2010)

Coram:
Lewis, Van Heerden, Cachalia and Tshiqi JJA and Theron AJA

Heard:
08 March 2010

Delivered
25 March 2010

Summary:
Wrongfulness of conduct of security guard in allowing
unauthorized removal of truck from site where security
provider had contract with owner of site to protect it, but
where contract excluded liability for provider’s services –
held security provider not liable – owed no duty to owner
to prevent theft of its truck.

______________________________________________________________
ORDER
______________________________________________________________
On appeal from: North Gauteng High Court (Pretoria) (Du Plessis J sitting as
court of first instance):
The appeal is dismissed with costs, including those of two counsel.

JUDGMENT

LEWIS JA (VAN HEERDEN, CACHALIA AND TSHIQI JJA and THERON AJA
concurring)

[1] The primary issue in this appeal is whether the owner of a vehicle,
stolen from premises protected by a guard employed by a security firm at the
instance of the owner of the premises, has a claim in delict against the security
firm for the loss, by theft, of its vehicle. In Compass Motors Industries (Pty) Ltd
v Callguard (Pty) Ltd1 the court said, obiter, that in principle such a claim was
recognized. I shall deal more fully with this proposition later in the judgment. In
Longueira v Securitas of South Africa (Pty) Ltd2 the court found the security
company liable in similar circumstances, but on the basis that the third party
had relied on the existence of security provided by the owner of the premises
protected. The statement by the court in Compass Motors and the decision in
Longueira have been subjected to considerable criticism.3 And the high court
in this matter considered the statement of the general principle in Compass
Motors to be incorrect. This court is thus called upon to deal with the issue
directly.

The facts
[2] But first, the facts. The appellant, Viv’s Tippers (Edms) Bpk (Viv’s
Tippers) lets trucks to construction firms. In September 2004 it let several

11990 (2) SA 520 (W) at 529G-J.
2 1998 (4) SA 258 (W) at 263E-F.
3 See, for example, J Neethling, J M Potgieter and P J Visser Law of Delict 5 ed pp 64-65 and
the comments referred to there.

trucks to Lone Rock Construction (Pty) Ltd (Lone Rock) which was carrying
out construction works on a site at Kibler Park, Johannesburg. The site was
guarded by security guards employed by the respondent, Pha Phama Staff
Services (Edms) Bpk h/a Pha Phama Security (Pha Phama) in terms of a
contract between Lone Rock and Pha Phama. Viv’s Tippers was aware of the
security provided. The evidence of Mr Viviers, a director of Viv’s Tippers, was
that it was a term of its contract with Lone Rock that the site should be
secured.

[3] There was a long weekend from 23 to 26 September 2004. A Mercedes
Benz truck, belonging to Viv’s Tippers, was parked on the site, which was
enclosed, and which could be entered only through a locked gate. A security
guard employed by Pha Phama was on duty.  Two men arrived at the site on
Sunday 26 September and presented a letter to the guard, purporting to be
from a firm of truck repairers. I shall deal with the terms of the letter more fully
when dealing with the question whether the security guard acted negligently.
In essence it stated that mechanics would be sent to the site on that date to
repair the diesel pump of the truck in question, for which the vehicle
registration number was given. The letter also stated that while the truck would
be fixed on site, the mechanics would test drive it. The guard allowed the men
to drive the truck away from the site – and it was never seen again.

[4] Viv’s Tippers instituted an action in delict against Pha Phama claiming
the value of the truck (which was agreed), contending that as owner of the
stolen truck it had suffered loss as a result of the theft; that Pha Phama was
vicariously liable for the conduct of the security guard; and that Pha Phama
owed it a legal duty, rendering it liable for the loss. Pha Phama denied liability
on the basis that it had no legal duty and that even if it did have, the guard
was not negligent. Du Plessis J dismissed the claim finding that there was no
legal duty and that the guard had not been negligent. The appeal to this court
is with his leave.

Wrongfulness
[5] The first question before us is therefore whether the security guard’s
conduct in allowing the two men to drive the truck away from the site was
wrongful (or, to use a synomym, unlawful), rendering Pha Phama vicariously
liable. It is not disputed that the guard’s conduct constituted a positive act. The
question does not relate, therefore, to a wrongful omission. But the loss
suffered is purely economic: so the law does not without more impose a legal
duty on the guard to prevent loss. In Telematrix (Pty) Ltd t/a Matrix Vehicle
Tracking v Advertising Standards Authority SA4 Harms JA said that pure
economic loss ‘connotes loss that does not arise directly from damage to the
plaintiff’s person or property but rather in consequence of the negligent act
itself, such as a loss of profit, being put to extra expenses or the diminution in
value of the property’. The loss, through theft, of property, would also fall in
this class.

Economic loss
[6] Where loss sustained is purely economic the question must be asked
whether public policy, or the convictions of the community, require that there
should be such a duty.5 That an action does lie for pure economic loss,
provided that public policy requires that it should, is now settled law. It is not
necessary to enumerate the authorities. However, courts have been
circumspect in allowing a remedy because of the possibility of unlimited
liability: the economic consequences of an act may far exceed its physical
effect. There is a spectre of limitless liability.6 It is established thus that a court,
in deciding to impose liability on an actor, must consider whether it is legally
and socially desirable to do so, having regard to all relevant policy
considerations, including whether the loss is finite and whether the number of
potential plaintiffs is limited.7 Where the success of an action could invite a
multitude of claims, sometimes for incalculable losses, an action will generally

4 2006 (1) SA 461 (SCA) para 1.
5 See in this regard Aucamp & others v University of Stellenbosch & others 2002 (4) SA 544
(C) and the authorities cited in paras 63-68; Telematrix (Pty) Ltd t/a Matrix Vehicle Trading v
Advertising Standards Authority SA above and Fourway Haulage SA (Pty) Ltd v SA National
Roads Agency Ltd  2009 (2) SA 150 (SCA); (653/07) [2008] ZASCA 131.
6 See Ultramares v Touche (1931) 255 NY 170, considered in Hedley Byrne & Co Ltd v Heller
& Partners Ltd [1964] AC 465 (HL).
7 P Q R Boberg The Law of Delict (1984) p 104ff.

be denied.8 But in each case the imposition of liability must turn on whether, in
the circumstances, liability should be imposed. That will in turn depend on
public or legal policy, consistent with constitutional norms: Fourway Haulage
SA (Pty) Ltd v SA National Roads Agency Ltd.9 To ensure that the question of
legal or public policy is not determined arbitrarily, or unpredictably, a court is
not required to react intuitively, but to have regard to the norms of society that
are identifiable: Minister of Safety and Security v Van Duivenboden10 and
Fourway Haulage.11

Economic loss in a contractual setting
[7] Where economic loss arises from a breach of contract, loss will of
course be limited. But a negligent breach of contract will not necessarily give
rise to delictual liability. This court has held that where there is a concurrent
action in contract an action in delict may be precluded: Lillicrap, Wassenaar
and Partners v Pilkington Brothers (SA) (Pty) Ltd.12 But that case held only
that no claim is maintainable in delict when the negligence relied on consists
solely in the breach of the contract. Where the claim exists independently of
the contract (but would not exist but for the existence of the contract) a
delictual claim for economic loss may certainly lie. This is made clear by Bayer
South Africa (Pty) Ltd v Frost 13 and Holtzhauzen v Absa Bank Ltd.14

[8] Accordingly it is possible that the assumption of contractual duties is
capable of giving rise to delictual liability. The question is whether there are
considerations of public or legal policy that require the imposition of liability to
cover pure economic loss in the particular case.15

8 Op cit p 105, citing Shell & BP South African Petroleum Refineries (Pty) Ltd v Osborne
Panama SA 1980 (3) SA 653 (D) and Franschoekse Wynkelder (Ko-Operatief) Bpk v SAR & H
1981 (3) SA 36 (C).
9 2009 (2) SA 150.
10 2002 (6) SA 431 (SCA) para 21.
11 Above para 22.
12 1985 (1) SA 475 (A). Contrast the decision of the court below in Pilkington Brothers (SA)
(Pty) Ltd v Lillicrap, Wassenaar and Partners 1983 (2) SA 157 (W).
13 1991 (4) SA 559 (A).
14 2008 (5) SA 630 (SCA); (280/03) [2004] ZASCA 79.
15 See Trustees, Two Oceans Acquarium Trust v Kantey & Templer (Pty) Ltd 2006 (3) SA 138
(SCA) para 12; Chartaprops 16 (Pty) Ltd & another v Silberman 2009 (1) SA 265 (SCA);
(300/07) [2008] ZASCA 115 para 22 (the passage is in the dissenting judgment of Nugent JA
but is not in conflict with the ratio of the majority judgment); and Aucamp v University of
Stellenbosch above.

Public or legal policy on imposing liability
[9] Viv’s Tippers argued that liability should be imposed on Pha Phama. It
relied, of course, on the statement in Compass Motors to which I have
referred. In that case Callguard had undertaken to Imperial Motors to provide
security guards at its premises at night. According to the contract between the
parties the only function of the security service provided was to minimize the
risk of loss through theft or vandalism. Callguard expressly did not guarantee
that they would succeed in this endeavour, and also excluded liability to
Imperial Motors or any third party for loss or damage arising out of the conduct
of its staff, including negligent conduct or omissions.

[10] Vehicles belonging to Compass Motors, lawfully parked at the Imperial
Motors premises, were stolen one night. In an action in delict for damages
caused by the omission by the guards to protect the premises, Van Zyl J
regarded the contract between Imperial Motors and Callguard as irrelevant.
The learned judge said:16
‘When considerations of public policy and its concomitants, justice, equity and
reasonableness, are applied to the facts and circumstances of the present case, I
believe that both these questions [whether a legal duty was owed by the security firm
to the entity whose vehicles were stolen, and whether that liability should be
restricted] should be answered in the negative. The contractual restriction or limitation
of liability is, in my view, totally irrelevant for purposes of establishing the delictual
liability of one or both contracting parties in respect of a third person who suffers
injury arising from an act or omission pursuant to the contract in question [my
emphasis]. The community's sense of justice, equity and reasonableness will
undoubtedly be offended by strictures placed on delictual liability towards third
persons, simply because the contract limits the contractual liability of the  parties inter
se.
The same applies to the nature and ambit of contractual obligations stipulated
in a contract, particularly in a case such as the present, in which the contractual
liability of the defendant has been considerably curtailed. It is conceivable that the
security procedures required of the defendant may be hopelessly inadequate for
purposes of protecting the property of third persons located on the premises. Should

16 Above at 529H-530F.

such persons be aware of the presence of a security system on the premises, they
may be lulled into a false sense of security in deciding to leave their property on such
premises. They are in fact relying on the presence of the security guards and they
may justifiably entertain the expectation that reasonable steps will be taken to protect
their property. According to the American Restatement of the Law 2d: Torts S 324A . .
.  this is one of the grounds on which a contracting party may, in American law, incur
liability to a third person for the “negligent performance of undertaking”, namely if “the
harm is suffered because of reliance of the other or the third person upon the
undertaking”. I would be reluctant, however, to restrict liability to cases where the
third party is aware of the existence of security procedures. In the times in which we
live it is not unjustifiable to presume that most businesses of any repute would
employ some form of security procedure for their own benefit and for that of their
clients. Most clients would be aware of this and it should not be necessary to
introduce the fact of their awareness as a prerequisite for liability. The case may be
different where the clients are aware of the inadequacy of the security arrangements
and nevertheless elect to entrust their property to unreliable guardians. For present
purposes, however, it is not necessary to suggest how this may affect liability.’

[11] This passage, as I have said, is obiter, for the court found that the
security guard was not negligent. In Longueira,17 however, the security service
was found liable, the court holding that the terms of the contract between the
owner of the premises and the security service were not relevant. The
fundamental difficulty that I have with this approach is that it does not explain
why the liability of the security company to third parties should be more
extensive than it is in contract with the party which hired it to provide security
services in the first place. For almost invariably, as in this case, the security
company will have excluded liability for loss or damage to premises or
property which it has been engaged to protect. How can the contractual
arrangement between the owner of the premises and the security provider be
irrelevant to the question whether a duty should be imposed on the security
provider to third parties whose property is stolen? And does the mere fact that
the person who engaged the security services, on the assumption that there is
no exclusion of liability and there would be a claim in contract, mean that a
third party should have the same protection?

17 Above at 263H-J.

[12] Counsel for Viv’s Tippers did not explain why the third party should be
better off than, or even in the same position as, the other party to the contract.
The propositions advanced in this regard were that Pha Phama was in control
of the premises and the truck on the relevant day; that the foreman of the site
(Mr Beukes) was contactable by telephone and that the guard should have
confirmed with him whether the truck should be removed; and that the site was
in a high risk area with a high level of crime. None of these factors, in my view,
is relevant to whether the guard’s conduct was wrongful. They are all factors
that must be taken into account in determining whether the guard was
negligent – whether he should have foreseen the possibility of harm and taken
steps to guard against it.

Relevance of terms of the contract
[13] The question whether Viv’s Tippers should have a claim – the question
as to wrongfulness – must be determined by whether public policy dictates
that a claim should be afforded to a third party where the owner of premises
who has arranged for security, and pays for it, is denied one. Pha Phama
would not have been guarding the premises but for its contract with Lone
Rock. The terms of that contract must, in my view, play a role in assessing
what the convictions of the community would be in relation to affording a claim
for compensation to a non-contracting party.18

[14] The relevant clauses in the contract are as follows:
‘4. The Contractor [Viv’s Tippers] shall by its services endeavour to prevent or
minimise possible damages occasioned by theft, burglary, or illegal disturbance to the
best of its ability. This is not to be construed as a warranty that such damages will be
prevented or minimised and no guarantee is given in this regard. The Client [Lone
Rock] must not assume these services to be an alternative to insurance and hereby
agrees that the Contractor cannot be held liable for any damage or loss incurred.
5. The Client hereby indemnifies the Contractor against any claims from loss or
damage or any other claim which may arise out of the provision of the Contractor’s
services in terms of this agreement.’

18 This was the conclusion of Du Plessis J in the high court too.

[15] Viv’s Tippers argued first that the exclusion of liability agreed to by Lone
Rock does not affect the obligation imposed on Pha Phama to compensate it
for the loss of the truck. I have already expressed doubt about the soundness
of that proposition and shall return to it. It contended, secondly, that the
clauses as phrased do not exclude liability on the part of Pha Phama for
negligent conduct, even to Lone Rock. Negligence is not mentioned in terms.
Viv’s Tippers relies in this regard on Galloon v Modern Burglar Alarms (Pty)
Ltd19 in which it was held that an exclusion clause in a contract that did not in
express terms exempt a contracting party from liability for negligence, and
could be interpreted to cover another cause of action, was not effective to
exclude liability for negligent conduct.

[16] In my view Galloon is not helpful. First, it was dependent on the very
specific wording of the contract. And secondly, subsequent cases in this court
have held quite the contrary. Dealing with the proper approach to the
interpretation of indemnity clauses, this court said in Durban’s Water
Wonderland (Pty) Ltd v Botha & another:20
‘The correct approach is well established. If the language of the disclaimer or
exemption clause is such that it exempts the proferens from liability in express and
unambiguous terms, effect must be given to that meaning. If there is ambiguity, the
language must be construed against the proferens. (See Government of the Republic
of South Africa v Fibre Spinners & Weavers (Pty) Ltd 1978 (2) SA 794 (A) at 804C.)
But the alternative meaning upon which reliance is placed to demonstrate the
ambiguity must be one to which the language is fairly susceptible; it must not be
“fanciful” or “remote” (cf Canada Steamship lines Ltd v Regem [1952] 1 All ER 305
(PC) at 310C-D [1952 AC 192]).’

[17] See also First National Bank of SA Ltd v Rosenblum & another,21
Johannesburg Country Club v Stott,22 Afrox Healthcare Bpk v Strydom,23 Van

19 1973 (3) SA 647 (C).
20 1999 (1) SA 982 (SCA) at 989G-J.
21 2001 (4) SA 189 (SCA).
22 2004 (5) SA 511 (SCA).
23 2002 (6) SA 21 (SCA).

der Westhuizen v Arnold24 and Redhouse v Walker.25 In First National Bank,
where the defendant had raised an argument based on the Galloon reasoning
Marais JA said the following:26
‘Before turning to a consideration of the term here in question [an exclusion clause
disclaiming liability on the part of the bank for liability for any loss or damage], the
traditional approach to problems of this kind needs to be borne in mind.  It amounts to
this:  In matters of contract the parties are taken to have intended their legal rights
and obligations to be governed by the common law unless they have plainly and
unambiguously indicated the contrary.  Where one of the parties wishes to be
absolved either wholly or partially from an obligation or liability which would or could
arise at common law under a contract of the kind which the parties intend to
conclude, it is for that party to ensure that the extent to which he, she or it is to be
absolved is plainly spelt out.  This strictness in approach is exemplified by the cases
in which liability for negligence is under consideration.  Thus, even where an
exclusionary clause is couched in language sufficiently wide to be capable of
excluding liability for a negligent failure to fulfil a contractual obligation or for a
negligent act or omission, it will not be regarded as doing so if there is another
realistic and not fanciful basis of potential liability to which the clause could apply and
so have a field of meaningful application.  (See  SAR & H  v  Lyle  Shipping  Co  Ltd
1958  (3)  SA  416 (A)  at  419D–E) [my emphasis].

It is perhaps necessary to emphasize that the task is one of interpretation of
the particular clause and that caveats regarding the approach to the task are only
points of departure.  In the end the answer must be found in the language of the
clause read in the context of the agreement as a whole in its commercial setting and
against the background of the common law and, now, with due regard to any possible
constitutional implication.’

[18] The exclusion clause in this case is not ambiguous. It says clearly that
Pha Phama gives no guarantee; that the contract is not an alternative to
insurance; and that it is not liable to Lone Rock for any damage or loss
incurred. Clause 5 makes it even plainer: Lone Rock indemnifies Pha Phama
against any claim arising out of the provision of its services, including
negligent conduct. But the argument in any event assumes that a valid claim
exists, and that begs the question whether Viv’s Tippers has a claim at all.

24 2002 (6) SA 453 (SCA) paras 13 and 23.
25 2007 (3) SA 514 (SCA).
26 Paras 6 and 7.

[19] That brings me back to the first issue – wrongfulness. Pha Phama
argued that there is no evidence that it was informed it was responsible to
third parties whose vehicles were parked on the site. Had Pha Phama known
that it was required to take on additional responsibilities it may have
contracted with Lone Rock on different terms – at a higher cost at least. Why
should Pha Phama, where it has regulated its liability to Lone Rock, be
exposed to the problem of indeterminate claims to unknown plaintiffs? The
argument is based on the very reason for circumspection in respect of claims
for economic loss: unlimited liability to unknown plaintiffs.

[20] In commenting on the problems arising from the general principle
expressed in Compass Motors Professors Dale Hutchison and Belinda van
Heerden wrote:27
‘Here [where a breach of contract causes loss not to a contracting party but within a
contractual matrix, as in Compass Motors] there is no privity of contract between the
plaintiff and the defendant, but each is linked by way of contracts to a middle party
and there is a clear tripartite understanding of where the risk is to lie . . . . In such a
situation there is little danger of indeterminate liability . . . .

Even though, ex hypothesi, the plaintiff here has no contractual remedy
against the defendant, all the parties to the arrangement knew exactly where the
respective risks lay. Therefore, each party, with full knowledge of his risk exposure,
could reasonably have been expected to have protected himself by other means (for
example, through contractual arrangements with other parties or by taking out
appropriate insurance).This of course also brings the anti-circumvention argument
strongly to the fore: to superimpose on the consensual arrangements a delictual duty
of care would disturb the balance, by allowing a shifting of losses within the matrix
contrary to the original understanding of the parties. Unlike the concurrence situation
[as was the case in Lillicrap above], it cannot here be argued that the scope of a
delictual duty would necessarily be circumscribed by the specific provisions of a
contract between plaintiff and defendant – in this type of case there is no direct
contractual link between them’ (my emphasis).

27 ‘The tort/contract divide seen from the South African perspective’ 1997 Acta Juridica 97
p114.

The consideration of policy and norms
[21] There are thus a number of reasons for concluding that the security
guard’s conduct in allowing the men to remove the truck from the site was not
wrongful. The primary reason is the contract itself, but for which there would
have been no security provided at the site, and which precludes a claim by
Lone Rock, the other contractant, which paid for the services. The undertaking
given by Pha Phama that it would prevent damage or loss to the best of its
ability, but that it gave no guarantees, would be completely undermined if a
claim against it by third parties were allowed. Community convictions would
not, in my view, permit the undermining of the contract in such a way.

[22] In argument during the hearing of the appeal counsel were asked to
consider the significance of the most recent decision dealing with a claim in
delict by a person against a party to a contract with another: Chartaprops 16
(Pty) Ltd v Silberman.28 There the claim was for damages for physical injury
caused by the omission of a cleaning service to mop up a spillage of liquid on
the floor of a shopping mall  (there was no evidence as to who had caused the
spillage) which had resulted in Mrs Silberman falling and injuring herself. The
cleaning service had entered into a contract with Chartaprops, the owner of
the mall, in terms of which it was obliged to clean the floors in accordance with
an agreed procedure.

[23] The majority of the court found that the cleaning service was liable for
the damages. Nugent JA dissented, concluding that it was Chartaprops that
was negligently in breach of a duty. For the purpose of this judgment nothing
turns on the difference in their respective approaches. And of course the
questions in that case were who was liable for the physical injury, and whether
there was liability for a negligent omission, whereas in this case we are
concerned with whether there should be liability for economic loss in a
contractual matrix, but not pursuant to a contract.

28 2009 (1) SA 265 (SCA); (300/07) [2008] ZASCA 115, referred to above. And see also
Pienaar & others v Brown & others (48/2009) [2009] ZASCA 165 (1 December 2009) where a
building contractor was found to be negligent, but the owner of a house was held not liable
where a balcony, negligently constructed, collapsed, resulting in injury to guests who had
been standing on the balcony.

[24] The debate centred on a passage in the majority judgment where
Ponnan JA said:29
‘Neither the terms of Advanced Cleaning’s engagement, nor the terms of its contract
with Chartaprops, can operate to discharge it from a legal duty to persons who are
strangers to those contracts.  Nor can they directly determine what it must do to
satisfy its duty to such persons.  That duty is cast upon it by law, not because it made
a contract, but because it entered upon the work.  Nevertheless its contract with the
building owner is not an irrelevant circumstance, for it determines the task entered
upon.’

[25] It was submitted, rather faintly, that the first sentence of the paragraph
means that the terms of the contract between the contracting parties can have
no bearing on the claim of the third party victim. If that is a correct reading of
the proposition, then it is not consonant with our law. But as counsel for Pha
Phama submitted, the balance of the passage indicates the contrary: the
terms are not irrelevant, for they determine what the ‘task entered upon’ is. In
this case, the task entered upon by Pha Phama was to secure the site but not
to guarantee success. The passage, in my view, is not inconsistent with the
conclusion that the contract must have a bearing on the claim of the third party
victim.

[26] As to other considerations of public policy, if one were to recognize the
general principle that was expressed in Compass Motors, security services for
particular premises might become unattainable. The spectre of limitless liability
to a multitude of unknown plaintiffs should preclude such a claim. One has
only to imagine a motor garage where many expensive vehicles are parked
and where there is no contractual privity between the security company or the
owner of the premises. Liability could be endless.

[27] Accordingly I conclude that the conduct of the guard was not wrongful
and that Pha Phama was not vicariously liable for the loss occasioned by the
theft of the vehicle. It is therefore not necessary to consider whether the guard

29 Para 47.

was negligent. But I shall do so briefly because the high court found that he
was not and Viv’s Tippers argued strenuously that the guard was negligent.

Negligence
[28] The evidence on negligence was sparse. The guard was not called to
testify. Mr Beukes, the Lone Rock foreman in charge of the site, testified that
he was contactable by the security guard on duty, and said that it would have
been agreed that in the event of a problem the guard should contact him. He
was not in fact telephoned when the two men approached the guard on the
Sunday afternoon and presented him with the letter in question. He said also,
however, that repairs were regularly done on the site over a weekend, but he
would usually be informed in advance when this was proposed. There was no
evidence that the security guard on duty was aware of this procedure.

[29] The driver of the truck also gave evidence and said that when he had
left the site before the weekend he had taken the key of the truck with him and
had left it at the premises of Viv’s Tippers. When he returned to the site after
the weekend the truck was no longer there.

[30] Viv’s Tippers argued that the guard’s negligence lay in not having
questioned the authenticity of the letter presented by the two men who arrived
claiming that they had been sent to repair the truck. It is true that the letter was
questionable: it was confused and confusing. It was on a letterhead of an
entity referred to as ‘Denver Truck Repaires (sic) and Spares Providers’.
Addresses and telephone numbers were set out. It was not addressed to Lone
Rock or to Pha Phama, but was signed by a Mr Pretorius who was stated to
be the manager. It was dated 23 September 2004 – the Friday of the long
weekend. The letter read:
‘Dear Sir
We will be sending our mechanics on Sunday 26th of September 2004, to look at one
of your Mercedes Benz truck that had a problem on Thursday afternoon.
We will send to [sic] guys to look at your diesel pump, then they will fix it on sight [sic]
and test drive the truck to make sure it is fine. The security will be informed on sight
[sic] then asked to sign this document for us.

The registration of this said truck is FBX 943 N.
All this will take place at your site in Kibler Park.
We trust that everything is in order.
Regards
(signed)
_____________
V Pretorius (Mnr) (Manager)

_____________
Security’

[31] Viv’s Tippers contended that the contents of the letter should have
alerted the guard to something untoward.  It is not literate, and while it says all
work will be done on site, it also states that the vehicle would be test-driven.
That could not be done on site. The guard, it argued, should have realized that
the letter was not authentic and should have foreseen the possibility of theft
and taken steps to guard against it.

[32] Du Plessis J in the high court found that there was simply not enough
evidence on which to make a finding as to negligence and that the onus of
proving negligence was not discharged by Viv’s Tippers. I agree with that
conclusion. There was nothing to suggest that the guard was literate or
educated. He was faced with a letter referring expressly to a Mercedes Benz
truck with a particular registration number. In the absence of evidence as to
how a reasonable person in his position would have acted, no finding as to
negligence can be made.

[33] The appeal is dismissed with costs, including those of two counsel.

_____________
C H Lewis
Judge of Appeal

APPEARANCES
APPELLANTS:

J H L Scheepers

Instructed by André Grobler Attorneys,

Pretoria;

Symington & De Kok, Bloemfontein.

RESPONDENTS:

N van der Walt SC (with him L Malan)

Instructed by Hunts (Ing Borkums)

Attorneys c/a Rooth Wessels, Pretoria;

McIntyre & Van der Post, Bloemfontein.
SUPREME COURT OF APPEAL OF SOUTH AFRICA

PRESS RELEASE

25 March 2010
STATUS: Immediate
VIV’S TIPPERS v PHA PHAMA STAFF SERVICES (132/09) [2010] ZASCA
(25 March 2010)

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

The Supreme Court of Appeal today dismissed an appeal against a decision
of the North Gauteng High Court which held that the owner of a vehicle, stolen
from premises protected by a guard employed by a security firm at the
instance of the owner of the premises, did not have a claim in delict against
the security firm for the loss of its vehicle as a result of theft in circumstances
where the security firm had contracted out of liability towards the owner of the
premises for any damage or loss incurred.

The SCA confirmed the decision of the high court that the terms of the
contract between the owner of the premises and the security company should
play a role in assessing what the convictions of the community would be in
relation to affording a claim for compensation to a non-contracting party, and
therefore whether the conduct of the security firm in allowing the vehicle to be
removed form the site was wrongful. The SCA held that the community
convictions would not permit the undermining of the contract between the

owner of the premises and the security firm in allowing a claim by a third party
in circumstances where the owner of the premises was contractually
precluded from claiming from the security company.  Allowing such a claim
could lead to limitless liability.

The SCA found also that there was not enough evidence on which to make a
finding as to negligence.