Auckland Park Theological Seminary v Wamjay Holding Investments (Pty) Ltd

The University of Johannesburg (UJ) owned property leased to Auckland Park Theological Seminary (ATS) under a long-term notarial lease registered on 20 December 1996. On 28 March 2011, ATS concluded a cession agreement with Wamjay Holding Investments (Pty) Ltd (Wamjay), ceding its rights in the lease for R6.5 million. The cession was registered on 13 October 2011 without UJ's knowledge or consent. UJ held the view that the lease rights were personal to ATS and not cedable without consent. On 5 October 2012, UJ cancelled the lease and communicated non-recognition of the cession's validity. UJ instituted eviction proceedings against ATS and Wamjay. The high court (Victor J) granted eviction and cancellation, which was ultimately upheld by the Constitutional Court on 11 June 2021, declaring the cession invalid. Following the Constitutional Court judgment, Wamjay instituted proceedings against ATS claiming repayment of R6.5 million based on unjustified enrichment (condictio indebiti). The high court (Friedman AJ) found in Wamjay's favour. ATS appealed, arguing the claim had prescribed.

• When did prescription begin to run for purposes of section 12(3) of the Prescription Act 68 of 1969?
• Whether the exception to section 12(3) applicable to professional negligence claims against legal practitioners extends to non-legal practitioners?
• Whether Wamjay proved its enrichment claim based on condictio indebiti?
• What constitutes 'knowledge of facts' versus 'knowledge of legal conclusions' for prescription purposes?

The appeal was upheld with costs, including costs of two counsel where employed. The high court order was set aside and substituted with an order dismissing the application with costs, including costs of two counsel where employed.

For purposes of section 12(3) of the Prescription Act 68 of 1969, prescription commences when the creditor has knowledge of the identity of the debtor and all material facts from which the debt arises, constituting a complete cause of action. Knowledge of material facts does not include knowledge of legal conclusions, except in the limited context of professional negligence claims against legal practitioners as established in Le Roux. A debt is 'due' when the entire set of facts which the creditor must prove to succeed with the claim is in place, i.e., when the creditor acquires a complete cause of action. The running of prescription is not postponed until the creditor becomes aware of the full extent of its legal rights or until legal certainty is obtained through court pronouncements. In claims for unjustified enrichment based on invalid contracts, prescription begins to run when the creditor knows or ought reasonably to have known of the invalidity and has sufficient facts to institute action, not when a court definitively pronounces on the invalidity.

The Court noted but did not decide the question raised in the third judgment in Le Roux regarding whether cases like Claasen v Bester, Fluxmans, McMillan and Van Heerden (which involved claims against attorneys) would be decided differently under the carved-out exception established by the majority in Le Roux, as this issue was not before the Court. The Court observed that while the relationship between ATS and Wamjay might have discouraged them from litigating against each other, nothing precluded Wamjay from seeking a declaratory order to interrupt prescription. The Court found it unnecessary to address the Plascon-Evans rule argument regarding disputed facts on enrichment, as this argument was not persisted with during submissions and became moot given the finding on prescription. The Court also found it unnecessary to consider two additional dates (10 March 2017 and 4 July 2018) that ATS argued could be relevant for prescription purposes, having found that 5 October 2012 was the determinative date.

This case clarifies the application of section 12(3) of the Prescription Act 68 of 1969, particularly the distinction between knowledge of material facts and knowledge of legal conclusions. It confirms that the exception carved out in Le Roux (where knowledge of facts may include legal conclusions in professional negligence claims against legal practitioners) is strictly limited to that context and does not extend to ordinary commercial transactions or claims against non-professionals. The judgment reinforces established jurisprudence that prescription begins to run when a creditor has knowledge of all material facts constituting a complete cause of action, not when legal certainty is obtained through court pronouncements. It emphasizes that parties cannot delay instituting claims while awaiting judicial determination of legal questions where they already possess the factual foundation for their claim. The case provides important guidance on when a debt becomes 'due' for prescription purposes in the context of unjustified enrichment claims based on invalid contracts.