This Supreme Court of Appeal judgment grappled with whether the claim involving latent and undisclosed defects discovered sometime after the claimant had purchased the property, had prescribed.

It is well established law that the debt becomes due, and prescription begins to run, when the creditor has the minimum facts necessary to institute action.

The running of prescription is not postponed until a creditor becomes aware of the full extent of their legal rights, nor until a creditor has evidence that would enable then to prove a case “comfortably”. 

But, as in this case, often the issue for determination is what constitutes the minimum known facts for prescription to have started running. 

The onus is on the party raising prescription to establish that the claimant was in possession of sufficient facts to cause them, on reasonable grounds, to believe that they had a claim against the defendants and that the defendants were aware of the defects but failed to disclose them or that the defects were concealed by those defendants.

When the claimant had acquired the minimum knowledge necessary to insert action is a factual enquiry.

The court referred to and cited with approval, three significant prescription judgments:

‘In a delictual claim, the requirements of fault and unlawfulness do not constitute factual ingredients of the cause of action, but are legal conclusions to be drawn from the facts:

“A cause of action means the combination of facts that are material for the plaintiff to prove in order to succeed with his action. Such facts must enable a court to arrive at certain legal conclusions regarding unlawfulness and fault, the constituent elements of a delictual cause of action being a combination of factual and legal conclusions, namely a causative act, harm, unlawfulness and culpability or fault”.

Truter and Another v Deysel [2006] (4) SA 168 (SCA)

“In order to successfully invoke s 12(3) of the Prescription Act, either actual or constructive knowledge must be proved. Actual knowledge is established if it can be shown that the creditor actually knew the facts and the identity of the debtor. The appellant places no reliance on actual knowledge but on constructive knowledge. Constructive knowledge is established if the creditor could reasonably have acquired knowledge of the identity of the debtor and the facts on which the debt arises by exercising reasonable care. The test is what a reasonable person in his position would have done, meaning that there is an expectation to act reasonably and with the diligence of a reasonable person. A creditor cannot simply sit back and “by supine inaction arbitrarily and at will postpone the commencement of prescription”. What is required is merely the knowledge of the minimum facts that are necessary to institute action and not all the evidence that would ensure the ability of the creditor to prove its case comfortably.”

            Macleod v Kweyiya [2013] (6) SA 1 (SCA)

“Furthermore, to say that the meaning of the phrase “the knowledge of . . . the facts from which the debt arises” includes knowledge that the conduct of the debtor giving rise to the debt is wrongful and actionable in law would render our law of prescription so ineffective that it may as well be abolished. I say this because prescription would, for all intents and purposes, not run against people who have no legal training at all. That includes not only people who are not formally educated but also those who are professionals in non-legal professions. However, it would also not run against trained lawyers if the field concerned happens to be a branch of law with which they are not familiar. The percentage of people in the South African population against whom prescription would not run when they have claims to pursue in the courts would be unacceptably high. In this regard, it needs to be emphasised that the meaning that we are urged to say is included in section 12(3) is not that a creditor must have a suspicion (even a reasonable suspicion at that) that the conduct of the debtor giving rise to the debt is wrongful and actionable but we are urged to say that a creditor must have knowledge that such conduct is wrongful and actionable in law. If we were asked to say a creditor needs to have a reasonable suspicion that the conduct is or may be wrongful and actionable in law, that would have required something less than knowledge that it is so and would not exclude too significant a percentage of society.”

Mtokonya v Minister of Police [2018] (2) SA 22 (CC)

The claimants took occupation of the property in July 2013. 

Several months after occupation they noticed various structural cracks and defects arising.

In June 2014 they lodged a claim with their insurer who declined the claim on the basis that the “defects were old and gradual, had been previously patched and were caused by the expansion and retraction of the clay upon which the property was built.”

And issued summons in July 2017 against the defendants.

On the facts supported by the authorities referred to, the appeal court determined that the claimants as early as June 2014, were in possession of sufficient facts to cause them on reasonable grounds to believe that there had been attempts by the defendants to cover up latent defects in the property.

The attempt to patch up the cracks would have immediately led to a reasonable belief that the defendants had fraudulently misrepresented the facts to them.  That apprehension was sufficient to complete their cause of action against the defendants.

Accordingly, the claimants had knowledge of sufficient facts which would have led them to believe that the defects existed when they purchased the property from the defendants and that they were fraudulently concealed.

The court found that the claimants did not have the necessary knowledge of the minimum facts only on becoming aware of the cause of the defects.  That is at odds with the established legal principles referred to.

It was found that the claim had prescribed.