South Africa - Time Bars

Date: 31/01/2017
Author: Edmund Greiner
Source: Shepstone & Wylie Attorneys
South Africa - Time Bars

Prescription and Time Bars - The Position in South Africa

Prescription of claims in South Africa is, in general, determined in accordance with the provisions of the Prescription Act 69 of 1969 ("the Prescription Act"). The Prescription Act provides for the extinctive prescription of contractual and delictual (tortious) claims after the lapsing of three years from the date on which such claim arises (1).
Normally, the running of extinctive prescription may be interrupted by an acknowledgment by the debtor (express or tacit) of his liability to the creditor, or by the service on the debtor of any legal process whereby the creditor claims payment of the debt.
The running of prescription is further interrupted by the establishment of security, even if proceedings have not at that time been issued, provided that further steps to enforce the claim are taken within a period of one year from the date of the security having been established which period can be extended by application to court in certain circumstances.
Prescription is also suspended in certain circumstances, for example where the debtor is out of the country. Upon the return of the debtor prescription will start to run for at least a period of one year.
The provisions of the Prescription Act only apply in so far as they are not inconsistent with the provisions of any other statutory provision which prescribes a specified period within which a claim is to be made or an action is to be instituted in respect of a debt, or which imposes conditions on the institution of an action for the recovery of a debt. Without entering into an exhaustive treatise on the various other statutory provisions which provide for their own specified periods (2), we highlight a few of the more prominent provisions (particularly as it pertains to claims of a maritime nature):

  • In terms of our Carriage of Goods by Sea Act ("COGSA"), cargo claims falling within the ambit of the Hague Visby Rules are subject to a one year time bar, which period can be extended by agreement between the parties. Our COGSA however only applies to outbound shipments.
  • Claims for damage or personal injury caused by a ship or sustained by any person aboard a ship and claims for salvage are, in terms of the South African Merchant Shipping Act, subject to a two year extinctive prescription period. If it appears that the ship concerned has not visited South Africa or the jurisdiction in which the prospective plaintiff operates and the latter has not had a reasonable opportunity to arrest the ship concerned, the court may extend the two year period.
  • Claims against organs of state, which includes the port authority and port terminal operator, Transnet, are required to be notified in writing to such parties within 6 months of the claim arising.

A summary of the position is provided in the table below:

Contract claims generallyWithin three years from date when the debt is due
[Chapter III of Prescription Act 68 of 1969]
Delictual (tortious) claims generallyWithin three years from date when the debt is due
[Chapter III of Prescription Act 68 of 1969]
Cargo claimsWithin one year from date of delivery of cargo or the date when it should have been delivered
[Article III Rule 6 of Hague Visby Rules as incorporated in Carriage of Goods by Sea Act No 1 of 1986]
Collision claims (loss or damage to another ship, its cargo or freight, damage for loss of life or personal injury suffered)Within two years from when the damage or loss or injury was caused
[section 344 of the Merchant Shipping Act No 57 of 1951 as amended]

The issue of prescription is further complicated in Admiralty matters by virtue of the fact that, given the international nature of shipping, more often than not the substantive law to be applied in determining the merits of a claim is a foreign law. As our law of prescription is deemed to be substantive in nature it would be superseded by the foreign law. Where however issues of prescription are deemed by the foreign law to be procedural in nature that law would not ordinarily be applied either, the general rule being that our courts will not enforce foreign procedure. When confronted with this 'gap' our courts approach the matter by seeking to apply the legal system which in the particular circumstances has the closest and most real connection to the issue of prescription. In the circumstances there is no 'hard and fast' rule in Admiralty matters, each case will have to be considered in light of its own particular facts.

Notes

  1. Certain specific exceptions provide for longer periods of prescription, for instance, thirty years in respect of a judgment debt, a debt secured by a mortgage bond, a debt in respect of any taxation imposed or levied, and any debt owed to the State in respect of, inter alia, the right to mine minerals or other substances. Debts arising under a bill of exchange or other negotiable instrument or from a notarial contract generally have a period of prescription of six years (unless a longer period applies due to the application of another provision of the Prescription Act).
  2. Important exceptions are contained in, for example, legislation governing claims lodged against the Road Accident Fund for personal injuries sustained arising out of a motor vehicle accident.

Authors:
Edmund Greiner, Partner and Pauline Kumlehn, Senior Associate in the International Transport, Trade and Energy department at Shepstone & Wylie Attorneys.
Contact:
+27 21 419 6495
greiner@wylie.co.za
kumlehn@wylie.co.za

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