Roshcon (Pty) Ltd v Anchor Auto Body Builders CC and Others

Roshcon (Pty) Ltd contracted to purchase five Nissan trucks for a project. The trucks were ordered through a dealer, Toit’s Commercial (Pty) Ltd, which financed the acquisition via floor plan and supplier agreements with Firstrand Bank Ltd (Wesbank). Under these agreements, Wesbank paid Nissan Diesel for the trucks and expressly reserved ownership until Toit’s paid Wesbank in full. The trucks were delivered to Anchor Auto Body Builders for modification and then handed over (at least constructively) to Roshcon, which paid Toit’s in full. Toit’s, however, failed to pay Wesbank and was placed under liquidation. Wesbank asserted ownership and recovered the trucks, selling two of them onward. Roshcon sought a declaratory order that it was the owner, alleging that the agreements reserving ownership were simulated, alternatively that Wesbank was estopped from asserting ownership.

The appeal was dismissed with costs, including the costs of two counsel. The order of the High Court granting Wesbank’s counter-application and confirming its ownership was upheld.

The case confirms the validity in South African law of floor plan and supplier agreements reserving ownership to a financier as security, and clarifies the test for simulated transactions following CSARS v NWK Ltd. It provides important guidance on ownership of movable property in asset-based finance and limits the use of estoppel against finance houses in such contexts.