Summary judgment offers a swift path to judgment for a plaintiff under certain conditions. One crucial condition is that the plaintiff’s claim must be based on a liquid document or a liquidated amount of money.
A claim is a liquidated amount in money if it is based on an obligation to pay an amount agreed upon, or the amount of money is ascertainable by a mere matter of calculation (speedy and prompt ascertainment).
Claims for damages, however, are typically uncertain and require court determination, making them unliquidated claims.
The fate of a damages claim under summary judgment therefore seems straightforward – that generally such claims do not qualify the summary judgment procedure due to their uncertain nature. However, are there exceptions? Can a damages claim ever pass the summary judgment test?
They can. One such exception occurs when parties typically agree a damages claim. A compromise on a damages claim for example, may render an illiquid claim, liquid.
This is what happened in the case of Meyers Hire (Pty) Limited v Filzo Enterprises (Pty) 2023 JDR 3508 (EMCA), Meyers Hire was owed moneys by Filzo Enterprises. Some of its claims were liquid while others like a claim for damage to truck tyres hired to Filzo Enterprises were not. Prior to litigation ensuing between the parties, they undertook certain negotiations to resolve the outstanding amounts and struck an agreement as to the amount constituting the tyre damages. Filzo Enterprises confirmed this agreement, but overall negotiations failed, and Meyers Hire was compelled to institute action against Filzo Enterprises. The court ruled that since the amount for the damages to the truck tyres was agreed upon by virtue of a compromise between the parties, the claim was rendered liquid and absent a valid defence, Meyers Hire was entitled to summary judgment for that amount.
A claim for damages generally requires evidence and the assessment and determination of such evidence by the Court. This renders such a claim unliquidated and inappropriate for a summary judgment in terms of our Rules of Court. However, where parties have agreed to an amount with respect to a claim for damages, such a claim becomes liquidated and suitable for a summary judgment application in the event of non-payment.