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[2017] ZAWCHC 21
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Kleynhans and Others v Overstrand Municipality (A231/2016) [2017] ZAWCHC 21 (13 March 2017)
THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
In
the matter between
Full Court Case No:
A231/2016
Court a quo Case No: 12755/2011
MARIUS
JACOBUS KLEYNHANS
1
st
APPELLANT
HEATHER
KLEYNHANS
2
nd
APPELLANT
CORNERCADE
(PTY) LTD
3
rd
APPELLANT
SHIRLEY
MILLICENT KOSTER
4
th
APPELLANT
TIELMAN
NIEUWOUDT AGENBAG
5
th
APPELLANT
and
OVERSTRAND
MUNICIPALITY
RESPONDENT
Coram
:
ERASMUS, SAMELA & ROGERS JJ
Heard:
1 FEBRUARY 2017
Delivered:
13 MARCH 2017
JUDGMENT
ROGERS J (ERASMUS AND SAMELA JJ concurring):
Introduction
[1]
This is an appeal against a decision of Henney J
in which he dismissed the appellants’ application for want of
prosecution.
The learned judge granted the appellants leave to appeal
to a full bench, limited to only one of the proposed grounds of
appeal.
On petition the Supreme Court of Appeal extended the leave to
all the grounds advanced by the appellants.
[2]
Mr Nelson SC leading Mr van Huyssteen appeared
for the appellants and Mr la Grange SC leading Mr Cilliers for the
respondent.
[3]
For convenience I shall refer to the appellants
collectively as they were in the court a quo, namely the applicants.
I shall refer
to the first appellant by his surname, Kleynhans, and
to the respondent as the Municipality.
Condonation
and reinstatement
[4]
The appellants did not comply timeously with rule
49(6). Leave to appeal was granted by the Supreme Court of Appeal on
6 August
2015. The appellants filed their notice of appeal 4
September 2015. Within 60 days, ie by 30 November 2015 (the
appellants erroneously
say 4 December 2015), the appellants were
required by rule 49(6)(a) to make written application for a date for
the hearing of the
appeal. Simultaneously therewith, the appellants
were required by rule 46(7)(a) to lodge and serve the requisite
copies of the
record. The application for a date and lodging and
serving of the record occurred on 30 June 2016. By that stage the
appeal had
lapsed.
[5]
The appellants have applied in terms of rule
49(6)(b) for the reinstatement of the appeal and condonation for
their failure to comply
with the time limits in question. The
explanation advanced for the delay is that on 12 October 2015 the
appellants’ Cape
Town correspondent requested transcripts of
Henney J’s judgments of 11 February 2015 and 29 April 2015.
Despite frequent
reminders to the transcription service, the signed
judgments were only received on 24 February 2016. On 2 March 2016 the
appeal
documents were delivered to the company tasked with binding
the record. A draft appeal record was received back on 9 May 2016.
The record was only released on 8 June 2016 following payment of the
company’s invoice. There was then a delay of a couple
of weeks
in order to obtain a power of attorney.
[6]
The explanation is not satisfactory. I find it
difficult to understand why it was necessary to obtain copies of
Henney J’s
judgments from the transcribers. Henney J handed
down written judgments, both of which must have been included in the
petition
to the Supreme Court of Appeal and must thus have already
been to hand when leave to appeal was granted. Be that as it may, it
appears that the Cape Town correspondent did in fact go through a
further process of obtaining Henney J’s judgments, which
only
came to hand on 24 February 2016, by which time the appeal had
already lapsed. Once the bound record became available on 9
May 2016,
the appellant’s could and should have proceeded more swiftly.
[7]
Although the explanation is not satisfactory, the
appellants were clearly intent on prosecuting the appeal. The
respondent has not
suffered any prejudice. As will appear from what
follows, the appellants enjoy good prospects of success in the
appeal. I have
thus come to the conclusion that condonation should be
granted and the appeal reinstated.
Procedural
background
[8]
The appeal record comprises the papers in the
Municipality’s application for the dismissal of the main case.
The papers in
the main case are not part of the appeal record. Henney
J did not, in granting the dismissal application, refer to the merits
of
the main case. Neither side in their heads of argument referred to
the record in the main case or said that it should be placed
before
us. Accordingly, and although Mr la Grange suggested that we should
have regard to the papers in the main case, I do not
think that this
would be appropriate nor is it necessary for a proper adjudication of
the appeal. Certain information about the
main case was traversed in
the dismissal application and I shall confine my attention to such
information.
[9]
During 2004 and 2005 the applicants were among a
number of people who bought plots from the Municipality in Fernkloof
Estate in
Hermanus.
[10]
On 20 July 2011 the applicants issued an urgent
application for hearing on 27 July 2011 for an order that the
Municipality arrange
for Fernkloof Estate to be fully protected by
electric fencing within such period as the court might direct.
[11]
The application was postponed on several
occasions and eventually served before Henney J on 7 June 2012 and 31
July 2012. By this
stage answering and replying papers had been
filed. Various interlocutory applications were pending, including
(i) applications
by the applicants to condone the late filing of
their replying affidavits and the late filing of their heads of
argument and for
an order in terms of rule 35(14) directing the
Municipality to make discovery; and (ii) applications by the
Municipality to
strike out material from the applicants’ papers
and for leave to cross-examine Kleynhans. The Municipality had also
taken
various preliminary points, one of which was a complaint that
the applicants had failed to join various necessary parties, being
the owners of properties within Fernkloof Estate, abutting owners,
the Hermanus Golf Club, the Fernkloof Estate Master Property
Owners
Association (‘MPOA’) and various precinct owners
associations.
[12]
Henney J heard argument on the non-joinder
objection. We were informed from the bar that the striking-out of
application was also
argued, the Municipality’s contention
being that inadmissible material should be excised before the papers
were served on
any parties who might have to be joined.
[13]
It appears that Henney J agreed with the
Municipality’s non-joinder point but disagreed that the
striking-out should be decided
before the joinder of further parties.
On 13 August 2012 he issued an order requiring that an attached
notice be served on the
parties indicated therein. The attached
notice required any party claiming a right to be joined to file an
affidavit within 100
days setting out the grounds upon which he
claimed such right. In the absence of an affidavit, the person in
question would be
treated as having elected to abide the court’s
decision and waived the right to be joined. The parties were granted
leave
to approach Henney J in chambers after the expiry of the
100-day period to make a ruling on who should be joined and to
provide
directions for the further conduct of the case.
[14]
The order was duly served. The 100-day period
expired on 11 September 2013. Although various recipients filed
affidavits, none of
them stated that they wished to be joined.
Whether those affidavits are admissible in the main case is not a
question with which
I need concern myself.
[15]
On 13 March 2014, about six months after the
expiry of the 100-day period, the Municipality’s attorney, Ms
Chin (‘Chin’),
wrote to the applicants’ attorney,
Mr Range (‘Range’), stating that according to her
calculations the 100-day
period lapsed on 13 September 2013. She said
that it seemed that security at Fernkloof Estate was no longer a
concern to Kleynhans
and she assumed that the applicants no longer
wished to proceed with the main case. She stated that the
Municipality could not
leave the matter pending. In the absence of a
response by 20 March 2014, the Municipality would approach the court
to dismiss the
main case.
[16]
Range responded on 20 March 2014, stating that he
had been unable to contact his ‘client’ for
instructions. He
thought his client might be temporarily out of the
country.
[17]
Chin replied on 25 March 2014 stating that she
assumed Range’s ‘client’ to be Kleynhans. She
questioned why Range
did not communicate with Kleynhans’ wife
who was in Hermanus.
[18]
On 28 March 2014 Range wrote to Chin stating that
his instructions were that the applicants intended to proceed with
the main case,
that he had been instructed to update the court file
in order to address Henney J in accordance with his order of 13
August 2012.
He said that he would in due course provide Chin with an
updated index and request available dates to appear before Henney J.
[19]
Several weeks later, on 15 April 2014, Chin wrote
to Range recording that she had not received an updated index or
dates to appear
in chambers. She said that if these were not received
by 25 April 2014 the Municipality would approach the court for
dismissal
of the main case.
[20]
Range replied on 29 April 2014 stating that he
was still in the process of updating the index and would revert in
due course.
[21]
On 5 May 2014 Chin wrote to Range to say that in
the absence of further developments her instructions were to proceed
with a dismissal
application.
[22]
The parties met Henney J in chambers on 27 June
2014. Range says that because the meeting was scheduled without prior
consultation
with him, his senior counsel was not able to attend. At
the meeting Chin handed to Henney J an affidavit dated 18 June 2014
in
which the Municipality sought directions from the judge regarding
the Municipality’s proposed dismissal application. Chin
did not
send a copy of the affidavit to Range in advance of the meeting nor
did he receive a copy at the meeting (apparently the
copy intended
for him was given to the judge because the latter preferred not to
receive the original).
[23]
It is common cause that at this meeting Range
said that the applicants wished to continue with the main case but
might wish to file
further affidavits. According to Chin, Range gave
no adequate explanation for the applicants’ delay in
prosecuting the case.
Chin says that Henney J agreed that it would be
appropriate for the Municipality to deliver a dismissal application.
[24]
The Municipality delivered its dismissal
application on 1 September 2014 for hearing on 14 October 2014 or on
such other date as
Henney J might direct. Chin made the supporting
affidavit, attaching her earlier affidavit of 18 June 2014. On 10
October 2014
and by agreement the judge made an order postponing the
dismissal application to 2 December 2014 with a timetable for further
affidavits.
Opposing and replying papers were filed during October
and November 2014.
[25]
Henney J heard the dismissal application on 2
December 2014. He delivered judgment on 11 February 2015, dismissing
the main application
with costs.
Requests
for mediation
[26]
The above chronology does not deal with two
matters which assumed significance in the dismissal application,
namely attempts by
the applicants to have the matter referred to
mediation and the MPOA’s commissioning of a security report.
[27]
As to the first of these matters, the applicants’
senior counsel, Mr Nelson, is an enthusiastic proponent of mediation.
On
19 May 2012 he suggested to the Municipality’s counsel that
the dispute be referred to mediation. On 21 May 2012 Chin wrote
to
Range stating that her client declined the mediation invitation.
Range responded on 24 May 2012 with a detailed motivation for
mediation. Chin replied on the same day, repeating her client’s
rejection of mediation. She said that at the hearing of the
case
(then scheduled for 7 June 2012) the Municipality would try to
prevent a further escalation in costs by asking the court to
dismiss
the main case, based on the applicants’ failure (at that stage)
to file replying affidavits or heads of argument
in accordance with
the rules.
[28]
As previously noted, the application was
postponed on 7 June 2012. Mr Nelson repeated his proposal for
mediation on several occasions
during June and July 2012 but with no
greater success than before.
[29]
After the service of the order of 13 August 2012
on various potentially interested persons, the applicants’
legal representatives
sought to resuscitate mediation by canvassing
it with the Hermanus Golf Club and property owners.
[30]
On 16 May 2013 Range, acting on behalf of
Kleynhans and his wife (the first and second applicants in their
capacities as trustees
of the Kleynhans Family Trust), referred the
dispute between the Trust and the Municipality to a firm called
Equillore for mediation,
tendering to meet the cost of the initial
two-hour mediation meeting. Range stated in the dismissal application
that this was done
in a further attempt to resolve the matter in an
expeditious and cost-effective way
[31]
Following a telephonic discussion between Chin
and the Equillore mediator, Mr G de Kock, on 23 May 2013, Chin
emailed De Kock, complaining
that she had still not received the
relevant information from him in order to discuss the mediation
proposal with her client and
counsel. On the same day De Kock sent
her an email, copied to the Municipality, attaching a copy of the
referral to mediation and
seeking the Municipality’s consent to
participate in mediation.
[32]
Chin responded on 30 May 2013, stating that the
Municipality agreed with her that there should not be mediation. She
apparently
took umbrage at De Kock’s having communicated with
the Municipality directly (presumably by including the Municipality
as
a recipient of his email to Chin). This was said to be
unprofessional and left her and the Municipality in doubt as to
whether
De Kock could be trusted to handle mediation in accordance
with the ethical rules of the legal profession.
[33]
De Kock responded on the same day explaining why
he thought mediation appropriate and taking exception to Chin’s
allegation
of unethical conduct.
[34]
On 31 May 2013 Chin wrote to De Kock reiterating
her instructions that the Municipality was not willing to participate
in mediation.
She said the only feasible resolution of the matter was
for the applicants to abandon their case and tender costs.
[35]
Despite this clear statement of the
Municipality’s position, De Kock on 12 July 2013 sent to Chin
and to various other persons
notice of a mediation meeting to be held
on 20 July 2013. Various parties attend the meeting but not the
Municipality’s representatives.
Range says that because of the
Municipality’s absence no vote was taken on mediation.
[36]
It will be recalled that the 100-day period
expired on 11 September 2013. There seems to have been no further
reference to mediation
prior to the Municipality’s launching
its dismissal application on 1 September 2014.
The
security report
[37]
Mr Nelson, Range and Kleynhans attended a meeting
of one of the precinct property owners associations on 3 August 2013.
This was
shortly before the 100-day period was to expire. During this
meeting they learnt that the MPOA had decided to appoint an
independent
security specialist, ISC, to do a survey of the weak
points in Fernkloof Estate’s security. Range says that after
this meeting
he and Mr Nelson advised the applicants not to proceed
with the main case pending the furnishing of the security report. At
that
stage it was expected that ISC would furnish the report by early
September 2013.
[38]
The 100-day period expired on 11 September 2013
without the security report yet being to hand. ISC had still not
produced it when
Chin resumed correspondence with Range on 13 March
2014. In the letters he wrote to Chin on 20 March 2014, 28 March 2014
and 29
April 2014, Range did not say that the applicants were
awaiting a security report before proceeding with the main case.
[39]
ISC’s report is dated 8 May 2014 but
Kleynhans says that he only received it on 18 August 2014. In the
meanwhile the parties
had met with Henney J on 27 June 2014. It is
common cause that Range did not tell the judge that the applicants
were holding back
because they were waiting for a security report.
[40]
According to Chin, she and the Municipality first
learnt of the existence of a security report when it was attached to
the answering
papers in the dismissal application.
Legal
principles applicable to dismissal application
[41]
Our courts have the inherent power to prevent an
abuse of their processes. This inherent power does not violate s 34
of the
Constitution which provides that everyone has the right to
have a dispute that can be resolved by the application of law decided
by a court or Tribunal in a fair public hearing.
[42]
Inordinate or unreasonable delay in prosecuting a
case may constitute an abuse of process and warrant dismissal (see
Cassimjee v Minister of Finance
2014
(3) SA 198
(SCA) para 10 and cases there collected). In para 11 of
Cassimjee
Boruchowitz
AJA said the following regarding this form of abuse of process:
‘
There
are no hard and fast rules as to the manner in which the discretion
to dismiss an action for want of prosecution is to be
exercised. But
the following requirements have been recognised. First, there should
be a delay in the prosecution of the action;
second, the delay must
be inexcusable and, third, the defendant must be seriously prejudiced
thereby. Ultimately the enquiry will
involve a close and careful
examination of all the relevant circumstances, including, the period
of the delay, the reasons therefore
and the prejudice, if any, caused
to the defendant. There may be instances in which the delay is
relatively slight but serious
prejudice is caused to the defendant,
and in other cases the delay may be inordinate but prejudice to the
defendant is slight.
The court should also have regard to the
reasons, if any, for the defendant’s inactivity and failure to
avail itself of remedies
which it might reasonably have been expected
to do in order to bring the action expeditiously to trial.
[43]
In para 12 Boruchowitz AJA said that the
following approach, articulated by Salmon LJ in
Allen
v Sir Alfred McAlpine & Sons Ltd; Bostik v Bermondsey and
Southwark Group Hospital Management Committee; Sternberg v Hammond
[1968] 1 All ER 543
(CA) at 561e-h, commended
itself to him:
‘
[
A]
defendant may apply to have an action dismissed for want of
prosecution either
(a)
because
of the plaintiff's failure to comply with the Rules of the Supreme
Court or
(b)
under
the Court's inherent jurisdiction. In my view it matters not whether
the application comes under limb
(a)
or
(b)
,
the same principles apply. They are as follows: In order for such an
application to succeed, the defendant must show:
(i)
that
there has been inordinate delay. It would be highly undesirable and
indeed impossible to attempt to lay down a tariff - so
many years or
more on one side of the line and a lesser period on the other. What
is or is not inordinate delay must depend on
the facts of each
particular case. These vary infinitely from case to case, but it
should not be too difficult to recognise inordinate
delay when
it occurs.
(ii) that this inordinate
delay is inexcusable. As a rule, until a credible excuse is made out,
the natural inference would
be that it is inexcusable.
(iii) that the defendants
are likely to be seriously prejudiced by the delay. This may be
prejudice at the trial of issues
between themselves and the
plaintiff, or between each other, or between themselves and the third
parties. In addition to any inference
that may properly be drawn
from the delay itself, prejudice can sometimes be directly proved. As
a rule, the longer the delay,
the greater the likelihood of serious
prejudice at the trial.’
[44]
There is some tension between the approach
summarised in para 11 and the approach of Salmon LJ approved in para
12. In terms of
the latter approach, inordinate delay and serious
prejudice must be established. Although there is no bright line
between inordinate
delay and lesser delay, Salmon LJ observed that
‘it should not be too difficult to recognise inordinate delay
when it occurs’.
Boruchowitz AJA likewise referred in para 10
to ‘inordinate or unreasonable delay’ as being at the
heart of this type
of abuse. But the second part of para 11 appears
to suggest that slight delay accompanied by serious prejudice might
be a sufficient
basis for striking out an action as an abuse of
process.
[45]
Para 11 of
Cassimjee
is
a summary of what Richings AJ said in
Gopaul
v Subbamah
2002 (6) SA 551
(D) at
558B-I. Richings AJ gave, as an example of relatively slight delay
but serious prejudice, an action arising from an assault
or a
collision where the events occurred in the space of a few seconds and
much depended on the testimony of eyewitnesses whose
memories might
become blurred in the course of time. There might, on the other hand,
be cases of inordinate delay but only slight
prejudice, such as where
the matter turns on the construction of documents or a sequence of
correspondence.
[46]
In my respectful view, Richings AJ’s
contrasting of relatively slight delay and inordinate delay does not
detract from the
fundamental requirement of inordinate or
unreasonable delay. His distinction, and Boruchowitz AJA’s
adoption of it, should
rather be understood as indicating that in
assessing whether a delay is inordinate or unreasonable one needs to
have regard to
the nature of the case and the type of prejudice which
delay could potentially occasion. A delay which is inordinate or
unreasonable
in one type of case may not be so in another type of
case.
[47]
It is appropriate here to mention the types of
delays which have featured in dismissal applications. In
Cassimjee
the delay was 25 years. This was inordinate on any test.
Unsurprisingly the dismissal application succeeded (there was also
evidence
of prejudice). In
Gopaul
there
was inactivity for about four years before the plaintiff demanded a
plea. The judge said that the plaintiff had been extremely
dilatory
but so too had the defendant. In the absence of prejudice, he
declined to strike out the action. The following delays
featured in
the cases collected in para 10 of
Cassimjee
:
Schoeman
[1]
– six
years;
Kuiper
[2]
– seven years;
Molala
[3]
– four and a half years;
Sanford
[4]
– six years;
Golden International
[5]
– five years. In all these cases except
Kuiper
the dismissal applications succeeded. Mr
Nelson provided us with a schedule of various unreported judgments
where delays ranging
from three years to sixteen years were
considered. In some the dismissal applications failed, in others they
succeeded.
[6]
[48]
It has been emphasised in a number of cases that
the court’s inherent power to dismiss a case as an abuse of
process, whether
on account of delay or other grounds, is a power to
be sparingly exercised and only in exceptional circumstances.
[49]
Mr la Grange submitted, with reference to
authority (inter alia
Grovit & Others v
Doctor & Others
[1997] 2 All ER 417
(HL)), that a litigant who commences and continues proceedings with
no intention of bringing them to a conclusion is guilty of
an abuse
of process and that such proceedings may be struck out whether or not
there has been inordinate and inexcusable delay
or prejudice.
Assuming that to be so, and for reasons which will appear later, I do
not think the appellants had the state of mind
necessary to
constitute this particular form of abuse. Furthermore the dismissal
application was avowedly brought on the basis
of inexcusable delay
and resultant prejudice.
[50]
Since we are considering this matter on appeal,
the question arises as to whether Henney J was exercising a
discretion in the strict
sense, in which case we could only intervene
only limited grounds. In
Cassimjee
it
was held that the power in question was a discretion in the strict
sense (para 23 read with para 11). There is arguably a distinction
to
be drawn between a finding that the claimant has abused the court’s
process and the decision whether or not to dismiss
the claim as a
result of the abuse, with only the latter involving a discretion, the
former being more in the nature of a jurisdictional
fact. It appears
to me, however, that the discretion contemplated in
Cassimjee
was understood to encompass the whole
evaluative exercise and by this we are bound.
The
delay and the reasons for it in present case
[51]
I consider under this heading the question
whether the applicants were guilty of inordinate or unreasonable
delay and whether the
delay was inexcusable.
[52]
It is common cause that the 100-day period
contemplated by Henney J’s order of 13 August 2012 expired on
11 September 2013.
The manner in which this period is calculated does
not appear in the record. The order was duly served by the sheriff
during August
2012. There was a further requirement that the papers
be made available electronically on the Municipality’s website
and
in hardcopy at the Hermanus Municipal Library, with the
responsibility to do this resting on the Municipality. Be that as it
may,
the Municipality did not allege in its dismissal application
that the applicants were responsible for any delay between 13 August
2012 and 11 September 2013.
[53]
In respect of the period prior to 13 August 2012,
the applicants do not appear to have been guilty of any significant
delay, even
though they were late in filing their replying papers in
the main case.
[54]
The delay which needs to be assessed is the one
which occurred after 11 September 2013. The Municipality delivered
its dismissal
application on 1 September 2014. If this is the
relevant period, the delay is about eleven and a half months. It
might be said,
however, that the relevant period should only be
reckoned to 27 June 2014, the day on which the parties appeared in
chambers before
Henney J, since on that day the Municipality’s
legal representatives informed the judge that the Municipality would
be bringing
a dismissal application and he indicated that this would
be the appropriate course of action. On this basis the delay was
about
nine months.
[55]
Although the delay was between nine and twelve
months, this case differs from those mentioned earlier in that there
was not complete
inactivity. There was an exchange of correspondence
between the attorneys during March-May 2014. Range wrote three
letters, at
least two of which made clear that the applicants
intended to proceed with the main case. And in June 2014 the parties
appeared
before Henney J, on which occasion Range repeated that his
clients wanted to go ahead with the main case. After Range’s
letter
to Chin of 28 March 2014 the Municipality could not have been
under the misapprehension that the case had ‘died’. The
Municipality was not in the same position as a number of the
litigants in the cases previously mentioned, where ‘sleeping
dogs’ were, after some years, rudely awakened by a bolt from
the blue.
[56]
As I have indicated, in assessing whether delay
is inordinate or unreasonable one may have regard to the nature of
the litigation
and the potential for delay to cause prejudice. Most
dismissal applications concern trial actions. The present case was an
opposed
motion. Founding, answering and replying papers in the main
case had been filed. We were told from the bar that there had also
been supplementary affidavits from the applicants and supplementary
answering affidavits from the Municipality dealing with new
allegations of fraud levelled at the Municipality. It thus appears
that most if not all of the evidence relevant to an adjudication
of
the main case was already before the court. This was not a case,
therefore, where relatively ‘slight delay’ might
suffice
as an abuse.
[57]
As will be apparent from my survey of other
cases, a delay of nine to twelve months, even if it were marked by
complete inactivity,
is well below the sort of delay which has
previously been found to qualify as an abuse. Having regard to the
nature of this particular
case and the stage it had reached by 11
September 2013, I do not think the delay of nine to twelve months can
be said to have been
inordinate or unreasonable, particularly having
regard to the intervening intimations from the applicants that they
wished to proceed.
[58]
In my respectful view, this was a sufficient
basis on which the Municipality’s dismissal application should
have been rejected.
[59]
If the delay was of sufficiently egregious to
call for an explanation, I would not differ from Henney J in
regarding the explanation
as unacceptable. As I have already
observed, the applicants’ obdurate persistence with mediation
after it was unambiguously
rejected by the Municipality is a
red-herring because mediation did not feature in the communications
between the parties after
11 September 2013 and was not put up by the
applicants as justifying the delay after 11 September 2013.
[60]
The only explanation advanced by the applicants
was that they were awaiting the ICS report. The applicants do not
explain, however,
how the ICS report was relevant to the litigation.
The applicants had not engaged ICS as an expert witness. There is
nothing to
show that a finding by ICS that Fernkloof Estate’s
perimeter security is inadequate would have any bearing on whether
the
Municipality has a contractual obligation to provide such
security. At best for the applicants (though this involves
speculation),
the ICS report might have caused the MPOA to install
improved security, if necessary by raising levies from owners.
Although this
would have made it unnecessary for the applicants to
pursue relief against the Municipality, that would be for reasons
extraneous
to the litigation.
[61]
Mr Nelson said that the applicants expected ICS
to furnish its report in early September 2013. They must soon have
realised that
this expectation was misplaced. Yet they allowed months
to pass without taking further steps in the litigation. What is
worse,
Range – in response to letters from Chin – failed
to disclose that the applicants were, on his advice and that of
senior
counsel, holding back until the security report was to hand.
He also failed to disclose this to Henney J. This is quite
inexplicable
unless he feared, as he might well have done, that the
Municipality would not have countenanced delay on this account.
Instead
he claimed that he was still working on an updated index but
nothing in that regard was in fact done
[62]
While Range’s lack of candour is to be
deprecated, I cannot find on the papers that his clients were not
following the advice
of their legal team in allowing the application
to lie in abeyance. It also cannot be found that they did not
genuinely intend
to pursue the application. They may have hoped that
the ICS report would open up an avenue for settlement or that
implementation
of its recommendations would render the fight against
the Municipality academic except for costs. But they say, and I
cannot reject,
that if the ICS report did not have the desired result
they intended to proceed with the application.
[63]
Cassimjee
lays down
that the court may also have regard to the reasons, if any, for the
Municipality’s inactivity and its failure to
avail itself of
remedies which it might reasonably have been expected to use in order
to bring the application expeditiously to
hearing. The Municipality
allowed six months to pass from 11 September 2013 before its attorney
wrote to Range about the expiry
of the 100-day period. There is no
explanation for this delay. Instead of making constructive proposals
to have the main case heard,
Chin stated, somewhat opportunistically,
that she assumed the applicants no longer wished to proceed with
their case and threatened
a dismissal application in the absence of a
response by 20 March 2014.
[64]
There was in fact a response by 20 March 2014. I
have already summarised the further correspondence. It is apparent
from Chin’s
letters that a dismissal application, rather than
the hearing of the main case, was the focus of the Municipality’s
attention.
[65]
There were less drastic remedies than dismissal
open to the Municipality. In terms of rule 6(5)(f) the Municipality
was entitled
to apply for the allocation of a date if the applicants
failed to do so within five days of delivering their replying papers.
The
applicants’ replying affidavits were, it seems, filed by
mid-2012. There were apparently supplementary founding and answering
papers. We gather that these too had been filed by the time Henney J
heard argument on 31 July 2012. It seems the applicants did
not file
supplementary replying papers. In terms of rule 6(5)(e) they would
have had ten days from the filing of the answering
affidavits to do
so. If after a further five days the applicants failed to apply for a
date (as was evidently the case), the Municipality
was free to do so.
[66]
In the alternative, and more plausibly in the
circumstances of this particular case, the Municipality could have
sought directions
from Henney J in accordance with his order of 13
August 2012. The Municipality did indeed rely on this order when
arranging the
meeting with the judge on 27 June 2014 but, instead of
seeking directions that would allow the main case to be heard, the
Municipality’s
legal representatives said that their client
would be bringing a dismissal application. What the Municipality
should have done
is to ask Henney J to rule either that the
applicants were barred from filing further affidavits or that they
should file them
by a specified date and in either event to specify a
date on which he would hear the main case. If the Municipality still
required
Kleynhans to be cross-examined (this would on the face of it
be somewhat surprising, given that in accordance with the
Plascon-Evans
rule the
applicants rather than the Municipality would be at risk in the event
of disputes of fact), its legal representatives
could have asked
Henney J to give directions for the hearing of the evidence.
[67]
To sum up so far, there was no unreasonable or
inordinate delay. If there was, the applicants’ explanation is
most unsatisfactory
but the Municipality itself is not free from
criticism in the way it dealt with the delay.
Prejudice
[68]
The Municipality did not demonstrate that the
delay would cause it prejudice in the conduct of the litigation.
Litigation prejudice
was unlikely to be present, given that the case
was brought on motion and the affidavits had already been filed. The
Municipality
did not say that if the case went to oral evidence the
delay would occasion difficulty for the Municipality.
[69]
In
Cassimjee
the
prejudice on which the court relied as a factor in support of
dismissal was litigation prejudice, ie a substantial risk that
if the
case proceeded a fair trial of the issues would not be possible
(paras 21-22). This is the sort of prejudice that generally
features
in the cases and I have no doubt that it will be the type of
prejudice which carries the greatest weight.
[70]
For the Municipality Mr la Grange reminded us
that in
Cassimjee
Boruchowitz
AJA said there were no hard-and-fast rules and prejudice was thus not
an indispensable requirement. He also referred
us to cases in England
and Australia where courts have been willing to treat as prejudicial
the fact that a defendant has an action
hanging over its head
indefinitely, potentially affecting the conduct of its business
affairs or requiring it to carry a contingent
liability in its books
of account. I do not exclude the possibility that prejudice of this
kind might also be taken into account
by the courts of this country.
Nevertheless, this sort of prejudice will usually be relatively
slight. In the absence of very specific
circumstances relating to the
effect of uncertainty on the defendant’s business affairs, I
would not expect prejudice of
this kind to warrant dismissal unless
accompanied by very substantial delay.
[71]
In the present case, as I have said, the delay
was relatively slight. The prejudice is likewise slight if it exists
at all. The
Municipality did not show that it would suffer any real
harm if the main case were allowed to proceed. There was no evidence
that
any contingent liability reflected in its accounts prejudiced
its ability to perform its functions. If instead of seeking dismissal
the Municipality had asked Henney J on 27 June 2014 to give
directions for the hearing of the main case, the application could
in
all probability have been heard and judgment delivered before the
Municipality’s financial year-end (30 June 2015).
Henney
J’s judgment
[72]
It will be apparent from what I have said above
that I would have dismissed the Municipality’s dismissal
application. But
since Henney J was exercising a discretion, the
question is whether there are grounds for appellate interference.
Various formulations
appear in the cases: Did the lower court fail to
exercise its discretion judicially? Was the court influenced by wrong
principles
or a misdirection on the facts? Was the result one which
could not reasonably have been reached by a court properly directing
itself
to all the relevant facts and principles? Did the court
exercise its discretion capriciously or fail to bring an unbiased
judgment
to bear on the question? Did the court fail to act for
substantial reasons? (See
Benson v SA Mutual
Life Assurance Society
1986 (1) SA 776
(A) at
781I-782B;
S v Basson
2007
(3) SA 582
(CC) para 110.)
[73]
In my respectful view the court a quo’s
decision is vitiated by misdirection. Perhaps on account of the way
the case was argued,
Henney J appears to have treated the relevant
delay as starting from the date on which he made his order on 13
August 2012. In
para 31 he said that it was clear from the evidence
that after 13 August 2012 the applicants, apart from having
facilitated service
of the court order, failed to take any further
steps to prosecute the matter. The only reference to the fact that
the 100-day period
stipulated in his order expired on 11 September
2013 is in his quotation from Chin’s letter of 13 March 2014.
He did not
approach the case on the basis that the delay with which
he was dealing started on 11 September 2013. Although he did not
quantify
the delay of which he found the applicants guilty, it is
apparent from his judgment that he must have regarded it as lasting
for
more than two years whereas it was in truth only nine to twelve
months.
[74]
As a result of this approach, and again no doubt
influenced by the content of the affidavits and the submissions made
to him, he
devoted some attention to the applicants’ repeated
requests for mediation. Mediation was, as I have indicated, a
red-herring.
[75]
A further misdirection, again relating to the
question of delay, is to be found in the court a quo’s
treatment of the three
basic requirements which the court extracted
from
Cassimjee
, namely
(i) a delay (ii) which is inexcusable and (iii) which has seriously
prejudiced the respondent (see para 51). After identifying
these
three requirements, Henney J went on to say that, having found that
the reasons proffered by the applicants for the delay
were contrived
and manufactured, he could not but conclude that the reasons for the
delay were inexcusable (para 52). In my respectful
view, the court a
quo erred in the way it framed the first requirement. The cases
indicate, in my view, that the delay must be
inordinate or
unreasonable. The judge did not in terms identify the extent of the
delay and evaluate whether or not it was inordinate
or reasonable. He
went straight to the question whether the delay was inexcusable.
[76]
Because the first requirement was not in my view
satisfied, the other questions did not strictly arise. If they did, I
think Henney
J was entitled to find – in relation to the second
requirement – that the delay was inexcusable. However he did
not
address the Municipality’s conduct and its failure to
pursue less drastic remedies such as seeking his directions for the
hearing of the main case or applying for an allocation in terms of
rule 6(5)(f). This was an important part of the evaluative exercise.
A failure to consider material relevant circumstances precludes the
judicial exercise of a discretion.
[77]
I must also respectfully conclude that the
material before the court a quo did not leave open, as one reasonable
conclusion, that
the Municipality was seriously prejudiced by the
delay. In para 53 of his judgment Henney J, having found the
applicants’
delay to have been inexcusable, identified the next
question as being whether the Municipality would be seriously
prejudiced. In
the paragraphs which follow the only prejudice which
is identified is that the Municipality is an organ of state
litigating with
public funds which cannot be expected to sit back and
wait for the applicants to decide whether to proceed with the main
case.
[78]
For these reasons I consider that appellate
interference is warranted.
Conclusion
[79]
Since the appeal must succeed, the appellants are
entitled to the costs of the appeal, including those attendant on the
employment
of two counsel.
[80]
The appellants must bear the costs of their
application for condonation and reinstatement, including the costs
associated with the
respondent’s answering affidavit.
[81]
As to the costs in the court a quo, the
Municipality’s dismissal application was misconceived and
should have failed. On the
other hand, the applicants without
justification delayed for nine to twelve months. Their attorney
failed to disclose to the Municipality’s
attorneys or to the
judge that the applicants were holding the application in abeyance
until the ICS report was to hand. I think
we should mark out
disapproval of this conduct by directing that the parties bear their
own costs in the court a quo.
[82]
The following order is made:
(a) The appellants’ application for
condonation and reinstatement of the appeal is granted. The
appellants must pay the
respondent’s costs of opposing the
application for condonation and reinstatement. It is recorded for the
guidance of the
taxing master that the application for condonation
and reinstatement was filed after the hearing of the appeal and thus
did not
take up any court time.
(b) The appeal is upheld with costs, including
those attendant on the employment of two counsel.
(c) The order of the court a quo dated 11 February
2015 is set aside and replaced with an order in the following terms:
“The
respondent’s application for the dismissal of the
main case is dismissed. The parties shall bear their own costs in
respect
of the dismissal application.”
______________________
ERASMUS J
______________________
SAMELA J
______________________
ROGERS J
APPEARANCES
For
Appellants
Mr
AJ Nelson SC & Mr J Van Dorsten
Instructed
by
Michael
Range & Associates
101
Warrington Arcade
4
Harbour Road
Hermanus
For
Respondent
Mr
A de V la Grange SC & Mr CR Cilliers
Instructed
by
Chin
Incorporated
7
The Courtyard
2
Harbour Road
Hermanus
[1]
Schoeman & Andere v Van Tonder
1979 (1) SA 301 (O).
[2]
Kuiper & Others v Benson
1984 (1) SA 474 (W).
[3]
Molala v Minister of Law And Order & Another
1993 (1) SA
673 (W).
[4]
Sanford v Haley NO
2004 (3) SA 296
(C).
[5]
Golden International Navigation SA
v
Zeba Maritime Co Ltd; Zeba Maritime Co Ltd v MV Visvliet
2008
(3) SA 10 (C).
[6]
See also
Elridge v ABS Bank Ltd
[2015] NZHC 44
para 104 where
a New Zealand judge said that he was not aware of the case where a
delay of less than 12 months had been held
to be inordinate.