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[2018] ZAWCHC 20
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Mboso v Standard Bank of South Africa (19416/2016) [2018] ZAWCHC 20 (19 February 2018)
SAFLII
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Certain
personal/private details of parties or witnesses have been
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IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
REPORTABLE
Case
Number: 19416/2016
In
the matter between:
NONGANGAPHILA
EUNICE
MBOSO
Applicant
and
THE
STANDARD BANK OF SOUTH
AFRICA
Respondent
JUDGMENT
DELIVERED 19 FEBRUARY 2018
Andrews
AJ
Introduction
[1]
This is an opposed rescission of judgment application pursuant to an
order purported to have been taken by agreement between
the parties
and granted on 10 November 2015. The application was argued on 12
February 2018. Adv T A Pharoah Appeared for
the Applicant and
Adv FSG Sievers appeared for the Respondent.
[2]
Applicant requested that the court condones the late filing of
Applicant’s replying affidavit and heads of argument.
Respondent had no objection to condonation being granted for the late
filing of the replying affidavit and heads of argument; however,
Respondent opposed the granting of condonation in relation to the
late filing of Applicants main application. I will deal first
with
certain points
in limine
raised by the parties.
Points
in limine
1.
Condonation
[3]
Applicant requested that the court condones her late filing of this
application and in particular her late filing of the replying
affidavit and heads of argument for the following reasons:
(a)
Applicant was unrepresented and was waiting for
pro bono
legal
assistance for which she applied through the Law Society;
(b)
Applicant’s attorneys were appointed in
December 2017 and
pro bono
Counsel was appointed on 31 January 2018.
[4]
Additionally, Applicant, after being informed of the order on 10
November 2015, contends that she had fallen ill and left for
the
Eastern Cape where she sought treatment. Furthermore, Applicant,
being retired and unable to afford legal assistance was at
a loss as
to how to proceed with this matter as her resources were depleted
which caused the delays in bringing the application
for rescission
timeously in terms of the rules. Applicant also argued that the
prospects of success were not inordinate or unarguable.
It was
further contended that the application was brought within a
reasonable time. It was submitted that Applicant had good reasons
for
the delay.
[5]
Respondent contends that Applicant failed to give any reasonable
explanation as to why almost a year had elapsed before launching
the
application for rescission. It was argued that this application was
launched shortly before Respondent became entitled in terms
of the
order, to execute against the property for the full amount of the
order and costs and as such, undermined the
bona
fides
of the application. Respondent
submitted that Applicant has set out no satisfactory basis for
condonation to be granted for the
delay in launching the present
application.
Legal
Principles pertaining to condonation
[6]
In essence,
there are three aspects which an Applicant should address in applying
for condonation, namely, the adequacy of the explanation,
which
includes the reasonableness thereof; the question of prejudice as
well as the prospects of success. It is an accepted legal
principle
that when applying for condonation, a full explanation for the entire
period of the delay should be encapsulated in the
application and
that a superficial and unconvincing explanation would not be
sufficient to overcome the non-compliance.
[1]
[7]
Also trite is the notion that public interest
dictates that there is finality in litigation, which is the reason
why time limits
are set. In determining what constitutes good
cause, a court is obliged to take all the relevant facts and
circumstances
of a case into consideration when exercising its
judicial discretion. Each case must be assessed on its own merits
when deciding
on what would constitute a reasonable period.
[8]
In the
General
Accident Insurance Co South Africa Ltd v Zampelli
[2]
case, the learned Tebbutt J acknowledges that courts have expressed
the need for strict compliance with the rules and recognised
that:
‘…
occasions may arise
when, due to the circumstances of the particular case, such strict
compliance may not have been possible, the
framers of the Rules have
allowed for condonation of non-compliance on “good cause
shown”…’
[9]
The learned Judge went on to say that the party
seeking the court’s indulgence should not only give a
reasonable and acceptable
explanation for his failure to comply with
the Rules but should also:
‘…
show that he has
what Berman J in Ajam v Franke
[3]
…has
described as “fair prospects of success”…’
[4]
[10]
Inasmuch as
Respondent argued that Applicant has set out no satisfactory basis
for condonation to be granted, it is clear that Applicant
has
expressed her desire to challenge the judgment and has put forward a
convincing explanation in this regard. I am satisfied
with the
adequacy of Applicant’s explanation and the reasonableness
thereof as it appears that the Law Society appointed
pro
bono
Counsel on 31 January 2018, which was approximately two weeks prior
to arguing this application. Applicant had no control over
that
process and as such, it would be unfair towards Applicant who would
no doubt be prejudiced as a result, bearing in mind that
Applicant
has in terms of Section 9 (1) of the Constitution
[5]
the right to equality before the law. Without legal representation,
she would have been at a distinct disadvantage. My
prima
facie
view about Applicant’s prospects of success during this
application for condonation is that it should not be approached with
rigidity. In light hereof, I am satisfied that Applicant has made out
a
bona
fide
defence which will be further ventilated when considering the
rescission of judgment application.
2.
Changes to Applicant’s
founding affidavit
[11]
Respondent brought it to the attention of the
court that there was a numbering change in the index. It would appear
that Applicant’s
founding affidavit now contains two extra
pages and that additional paragraphs were inserted. From the
commissioning and signatures
that appear at the base of every page,
it is clear that pages 10 and 11 are different to the original in
that the two pages are
not commissioned and bears only the initials
and not a signature. Nothing however turns on this, although
Respondent mooted that
it affects the
bona
fides
of this application. I deal with this
point further in this judgment.
Factual Background
[12]
Applicant contends that in 2003, at the
suggestion of her employer, she bought a property situated at […]
S. Close, Khanya
Park, Gugulethu for R170 000.00. According to
Applicant, she applied for a loan of R133 00.00 from Respondent which
was registered
as a mortgage bond against the property. She also used
R70 000.00 from her occupational pension fund as a deposit.
[13]
In 2004, a further payment of R100 000.00
was made by Applicant to offset the balance, which Applicant
contends, reduced the
outstanding balance to R31 000.00.
Furthermore, Applicant avers that she paid an increased monthly
instalment of R1 500.00
as opposed to R400.00 to service the
outstanding bond. In 2006, Applicant applied to Respondent, and was
granted a second loan
to the value of R60 000.00 to enable her
to effect renovations to her property. Applicant contends that she
regularly paid
her monthly instalments by debit order from 2003 until
February 2009 and was of the view that her liability to the
Respondent had
been extinguished. In 2009, Applicant made enquiries
with regards to the outstanding balance on her account and discovered
that
the balance outstanding was in the amount of R203 364.76.
[14]
Respondent issued summons under case number
23273/09 for the outstanding amount together with
inter
alia
, interest on the sum claimed at the rate
of 10% per annum from 1 October 2009 to date of payment together with
an order declaring
the property executable. The matter was set down
for trial on 10 November 2015. Prior to the commencement of
proceedings, settlement
negotiations were encouraged. Applicant
contends that she was not happy about the proposals made to her and
submitted that she
rejected any form of settlement and refused to
agree to the terms of the proposed order and expressed her desire to
defend the
action.
[15]
According to Applicant, she was asked to return
to her home and wait for her legal representative to contact her.
Later that day,
she was presented with a signed copy of the order
which she had earlier rejected.
Applicant’s
Principle Submissions
[16]
Applicant contends that the order was obtained
without her consent despite her strong opposition to settling the
matter. The
Applicant, claims that she did not receive any
statements for her bond account and was unaware that between the
periods November
2005 and July 2006, a total amount of R158 000.00
had been transferred from her account in varying amounts which
transfers
she had not authorised. She also contends that when she
applied for the second bond, the unauthorised transactions were not
brought
to her attention.
[17]
Applicant believed that she had already settled
the outstanding bond and that the debt was caused by fraudulent
transactions from
her bond account. Applicant argued that the
prospect of success is good. Applicant contends that she has a
bona
fide
defence and asked for an order as prayed
for.
Respondent’s
Principle Submissions
[18]
Respondent
submitted that the order was obtained by agreement. Applicant was
represented by a senior attorney and experienced counsel
at the
trial. Referring to the stated authority outlined in
Dlamini
v Minister of Law and Order and Another
[6]
it was argued that counsel when properly instructed to appear on
behalf of a litigant has implied authority to conclude a settlement
of the litigation on behalf of his or her client on the proviso that
he or she acts
bona
fide
and in the interests of the client.
[19]
It was also argued that Applicant has failed to
provide a reasonable explanation for the circumstances in which the
consent came
to be entered. In this regard, it was argued that
Applicant’s explanation of returning home made no sense. The
matter
was not settled and the order was not granted at the time nor
was the trial proceedings concluded. Respondent highlighted the
contradictions
in Applicant’s version in relation to the events
that occurred on the day when the order was obtained. What is certain
is
that Applicant was aware of the order as she received the said
order on 10 November 2015. It was submitted that it took Applicant
8
months after she became aware of the order to apply for
pro
bono
assistance. Additionally, it was argued
that Applicant did nothing until shortly before the
moratorium
was due to expire on 10 November 2016. According to Respondent
Applicant signed the notice of motion on 19 October 2016, being
the
date when she launched the present application.
[20]
Respondent contends that Applicant has failed to
set out a credible basis for the settlement agreement embodied in the
order to
be set aside. Additionally, Respondent argued that the
Applicant’s reason for convalescing in the Eastern Cape was not
satisfactory.
Respondent furthermore contended that the delays,
contradictions and alternations to the Applicant’s founding
affidavit affects
the
bona fides
of the application and argued that the application should be
dismissed with costs on the attorney client scale as provided for
in
the mortgage bond agreement.
Legal
Principles
[21]
It is trite
that a court order is enforceable until set aside by a court of
competent jurisdiction
[7]
. Until
that is done, the court order must be complied with even if it may be
wrong;
[8]
there is a presumption
that the judgment is correct. At common law, a court’s order
becomes final and unalterable by that
court at the moment of its
pronouncement by the Judicial Officer, who thereafter becomes
functus
officio
.
Save in exceptional circumstances it cannot thereafter be varied or
rescinded.
[22]
It is trite
that once a court has pronounced a final judgment or order, it has
itself no authority to correct, alter, or supplement
it. In
Firestone
South Africa (Pty) Ltd v Gentiruco AG
[9]
,
it was held that the reason for this is that, once the court
pronounced a final judgment, it thereupon becomes
functus
officio
:
its jurisdiction in the case having been fully and finally exercised
its authority over the subject –matter has ceased.
[23]
It is trite
that a consent judgment cannot arbitrarily be repudiated or
withdrawn. ‘
A
judgment given by consent may be set aside on “good and
sufficient cause”, an enquiry to be determined in accordance
with the same principles as are applicable to the rescission of
default judgment in terms of rule 31 (2) (b)’.
[10]
It is
settled that generally, an Applicant is to give a reasonable and
acceptable explanation for his or her default; that that
application
is made in good faith and that on the merits Applicant has a
bona
fide
defence which
prima
facie
carries some prospect of success.
[11]
[24]
The matter
of
Moraitis
Investments (Pty) Ltd and Others v Montic Dairy (Pty) Ltd and
Others
[12]
sets out the approach to an application for rescission of a consent
judgment. Wallis JA held that:
‘
The
issue is far more nuanced than the arguments suggest. The approach
differs depending on whether the judgment is a default judgment
or
one given in the course of contested proceedings. In the former case
it may be rescinded in terms of either rule 31(2)(b) or
rule 42 of
the Uniform Rules, or under the common law on good cause shown. In
contested proceedings the test is more stringent.
A judgment can be
rescinded at the instance of an innocent party if it was induced by
fraud on the part of the successful litigant,
or fraud to which the
successful litigant was party. As the cases show, it is only where
the fraud – usually in the form
of perjured evidence or
concealed documents – can be brought home to the successful
party that restitutio in integrum is
granted and the judgment is set
aside. The mere fact that a wrong judgment has been given on the
basis of perjured evidence is
not a sufficient basis for setting
aside the judgment. That is a clear indication that once a judgment
has been given it is not
lightly set aside, and De Villiers JA said
as much in Schierhout.
Apart
from fraud the only other basis recognised in our case law as
empowering a court to set aside its own order is justus error.
In
Childerley, where this was discussed in detail, De Villiers JP said
that ‘non-fraudulent misrepresentation is not a ground
for
setting aside a judgment’ and that its only relevance might be
to explain how an alleged error came about. Although a
non-fraudulent
misrepresentation, if material, might provide a ground for avoiding a
contract, it does not provide a ground for
rescission of a judgment.
The scope for error as a ground for vitiating a contract is narrow
and the position is the same in regard
to setting aside a court
order. Cases of justus error were said to be ‘relatively rare
and exceptional’. Childerley
was considered and discussed by
this court in De Wet without any suggestion that the principles it
laid down were incorrect.’
[25]
Further
in the judgment
Wallis JA stated that the principle that a court can only grant a
consent judgment if the parties to the litigation
consented to the
court granting such an order. If not, then the judgment must be set
aside.
‘…
This is that the
court can only grant a consent judgment if the parties to the
litigation consented to the court granting it. If
they did not do so,
but the court is misled into thinking that they did, the judgment
must be set aside. This is something different
from avoiding a
contract on the grounds of fraud, duress, misrepresentation or the
like. In those cases the injured party has an
election to abide by
the agreement. When one is concerned with an absence of authority to
conclude the agreement in the first place,
that is not a matter of
avoiding the agreement, but of advancing a contention that no
agreement came into existence.’
[13]
[26]
Wallis JA further deals with the requirement of a
reasonable explanation.
‘
A gloss has subsequently
been placed upon this proposition that, while lack of authority is
the preponderant factor, on its own
it may not suffice unless there
is a reasonable explanation for the circumstances in which the
consent judgment came to be entered.
[14]
There is merit in this because the court is being asked to set aside
its decision in circumstances where it is functus officio.
However,
in the light of my conclusion on the facts it is unnecessary to
express a final view on this. The case can be disposed
of in relation
to Mr Moraitis’ authority to represent the Moraitis Trust and
Moraitis Investments on the basis that the central
proposition that a
court may not grant an order making a settlement agreement an order
of court, unless the parties to the agreement
consent thereto, is
correct.’
[15]
[27]
In
MEC
for Economic Affairs, Environment & Tourism: Eastern Cape v
Kruizenga and Another
[16]
it was stated that:
‘
It is settled law that a
client’s instruction to an attorney to sue or to defend a claim
does not generally include the authority
to settle or compromise a
claim or defence without the client’s approval. The rule has
been applied to a judgment consented
to by an attorney without his
client’s authority and also when the attorney did so in the
mistaken belief that his client
had authorised him to do so. This
principle accords with the rule in the law of agency that where an
agent exceeds the express
or implied authority in transacting, the
principal is not bound by the transaction.’
Discussion
[28]
Respondent invited Applicant to produce oral
evidence to clarify the position in relation to the circumstances
under which the order
was taken, failing which, the court should make
an adverse inference. Applicant indicated that there is acrimony
between Applicant
and her erstwhile attorneys and that it will be
unlikely that the attorney would give an objective account of the day
in question.
Applicant has asked that the court not make a negative
inference given the circumstance in which Applicant finds herself
with her
erstwhile attorneys.
Conclusion
[29]
Applicant
is an elderly, lay
person who has acquired the immovable property in Gugulethu with her
earnings and with the guidance and assistance
of her former employer.
She also acquired a loan from Respondent. It is common cause that
Applicant diligently honoured her commitment
to Respondent until she
allegedly defaulted with the instalments in 2009. Applicant believed
then as she still believes now that
she settled her indebtedness to
Respondent. What transpired on the day when the order was obtained
remains a mystery.
Jurisprudence leans towards the legal
principles of agency between attorney and client in this regard.
Applicant contends that
her erstwhile attorney did not carry out her
instructions as her express instructions were that she was not
interested in the settlement
and wanted to oppose the matter, which
was her desire since the inception of the action. Thus, the
question which remains
unanswered is whether Applicant’s
erstwhile attorneys exceeded their express or implied authority. Of
course, this could
have been cleared up if the attorney was called to
give oral evidence in this regard. Given the arguments raised
in this
regard, I am not persuaded that a negative inference should
be drawn in relation to Applicant’s
bona
fides.
[30]
Additionally, I am not persuaded that a negative
inference should be drawn in relation to the contradictory
information encapsulated
in the pleadings and changes affected to the
pleadings as it should be born in mind that Applicant has had
challenges with regards
to her legal representation. Applicant is a
lay person who should not be prejudiced by the conduct of her
erstwhile legal representatives.
[31]
It is trite that each case must be adjudicated on
its own merits and this case is no different. The veracity of
the defences
raised by Applicant can be further ventilated at the
trial. I am of the view that a rigid approach to disregard
Applicant’s
version as improbable would be prejudicial to her.
[32]
In relation to the application for rescission of
judgment, I am satisfied that Applicant has given a reasonable and
acceptable explanation
for her default, namely that she did not agree
to the order and that she does not owe Respondent the amount being
claimed. Even
if there was a balance owing, Applicant is entitled to
challenge the discrepancy particularly in light of the allegation of
the
unauthorised fraudulent withdrawals from the Applicant’s
bond account. I am furthermore satisfied that the Applicant
has launched this application in good faith and that on the merits
Applicant has a
bona fide
defence which
prima facie
carries some prospect of success.
[33]
I am of the
view that Applicant should be afforded the opportunity to have her
day in court; proverbially speaking. Applicant has
a vested interest
and a constitutionally entrenched right to housing and should be
afforded an opportunity to achieve the progressive
realisation of
that right through the legislative measures which we are enjoined to
give credence to through entrenched constitutional
imperatives.
[17]
It is common cause that the property concerned is Applicant’s
primary residence, and that she is an elderly retired woman.
Applicant should, at the very least, be afforded the
opportunity to challenge and protect the interest which she has in
her primary residence situated in Gugulethu. To question Applicant’s
bona
fides
in challenging same would be tantamount to denying Applicant her
constitutionally protected right to housing which she has worked
hard
to acquire. To close the door to Applicant to defend the action would
additionally be tantamount to this court denying her
the right to
challenge and adduce evidence.
[18]
These are all issues that should in my view be ventilated at
the hearing of the matter.
[34]
In the result, after considering the submissions
made by Counsel on behalf of both the parties and after considering
the documents
filed on record, the following orders are made:
(a)
Applicant’s failure to comply with the
provisions of the Rules of court relating to time periods is hereby
condoned;
(b)
The judgment granted in this matter against
applicant on 10 November 2015 under case no: 23273/09 is set aside
and applicant is
given leave to defend the matter.
(c)
Costs are to stand over for later determination.
____________________________
P
ANDREWS, AJ
Acting
Judge of the High Court
IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
REPORTABLE
Case
no:19416/2016
In
the matter between:
NONGANAPHILA
EUNICE
MBOSO
Applicant
and
THE
STANDARD BANK OF SOUTH
AFRICA
Respondent
RESCISSION
OF JUDGMENT
JUDGE:
Andrews AJ
JUGDMENT
DELIVERED BY:
Andrews AJ
FOR
APPLICANT:
Adv. TA Pharoah (
Pro
Bono
)
INSTRUCTED
BY:
Ingrid Broodryk
Broodryk
Attorneys (
Pro Bono
)
FOR
RESPONDENT:
Adv. FSG Sievers
INSTRUCTED
BY:
William Inglis Inc.
DATES
OF HEARING:
12 FEBRUARY 2018
DATE
OF JUDGMENT:
19 FEBRUARY 2018
[1]
Premier Western Cape v
Lakay
2012 (2) SA 1
(SCA)
para 17;
Van Wyk v Unitas
Hospital & Another
[2007] ZACC 24
;
2008 (2) SA 472
(CC) para 22.
[2]
1988 (4) SA 407 (C).410H-I
[3]
1988 CPD, delivered on 18 April 1988 (unreported decision).
[4]
At 411D-E
supra
[5]
Section 9(1) of Constitution of the Republic of South Africa , 1996
provides ‘
Everyone is
equal before the law and has the right to equal protection and
benefit of the law’
;
See also
Carvey v Carvey
where the learned Judge
Donen AJ stated that ‘…Applicant will not enjoy equal
protection unless she is equally empowered
with the “sinews of
war”….’
[6]
1986 (4) SA 342 (DCLD).
[7]
Bezuidenhout v Patensie
Sitrus Beherend Bpk
2001
(2) SA 224
(E) at 229B-C;
MEC
for Economic Affairs, Environment and Tourism v Kruisenga
2008
(6) SA 264
(CkHC) at 277C;
Jacobs
v Baumann NO
2009 (5) SA
432
(SCA) at 439G-H.
[8]
Blue Moonlight Properties
39 (Pty) Ltd v Occupiers of Saratoga Avenue And Another
[2008] ZAGPHC 275
;
2009 (1) SA 470
(W) at 473C;
Culverwell
v Beira
1992 (4) SA 490
(WLD) 494A-C.
[9]
1977 (4) SA 298
(A); See also Erasmus Superior Court Practice, Vol
2, D1-561.
[10]
Erasmus Superior Court Practise D1-565.
[11]
Scholtz and Another v
Merryweather and Others
2014 (6) SA 90
(WCC) at 93D-96C.
[12]
(799/2016)
[2017] ZASCA 54
;
[2017] 3 All SA 485
(SCA);
2017 (5) SA
508
(SCA) (18 May 2017) at Paragraphs 12, 13 and 17.
[13]
Ibid paragraph 17.
[14]
Georgias
and Another v Standard Chartered Finance Zimbabwe Ltd
2000
(1) SA 126
(ZSC) at 132B-D;
Ntlabezo
and Others v MEC for Education, Culture and Sport, Eastern Cape
2001
(2) SA 1073
(Tk HC) at 1081B-E.
[15]
At para 20.
[16]
(169/09)
[2010] ZASCA 58
;
2010 (4) SA 122
(SCA) ;
[2010] 4 All SA 23
(SCA) (1 April 2010) MEC for Economic Affairs, Environment &
Tourism: Eastern Cape v Kruizenga and Another (169/09)
[2010] ZASCA
58
;
2010 (4) SA 122
(SCA) ;
[2010] 4 All SA 23
(SCA) (1 April 2010)
para 7
[17]
Section 26 (1) and (2) of Act 108 of 1996.
[18]
Section 35 (3) (i) of Act 108 of 1996.