Brompton Court Body Corporate SS119/2006 v Khumalo

The appellant, a sectional title body corporate, and the respondent, an owner of a unit in the scheme, referred disputes concerning levies, charges, repairs, damages and defamation to arbitration. The arbitrator issued an award in December 2012, partially upholding the respondent’s claims but ultimately awarding the appellant a net amount of R87 349.48 plus interest and costs. In March 2014 the appellant applied to the High Court in terms of s 31 of the Arbitration Act 42 of 1965 to make the arbitration award an order of court. The respondent opposed the application solely on the basis that the debt had prescribed under the Prescription Act 68 of 1969. The High Court upheld the prescription defence and dismissed the application, leading to an appeal to the Supreme Court of Appeal.

The appeal was upheld with costs. The order of the High Court was set aside and replaced with an order granting prayers 1, 2 and 3 of the notice of motion, effectively making the arbitration award an order of court, with costs.

The judgment authoritatively clarifies South African law on prescription in the context of arbitration. It confirms that arbitration awards generally do not create new debts and that applications to make such awards orders of court do not themselves constitute debts subject to prescription. The case corrects misinterpretations in earlier High Court decisions and provides important guidance on the operation of s 13(1)(f) of the Prescription Act.