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[2018] ZAWCHC 135
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Ziehl t/a Gustav Ziehl Makelaars v Old Mutual Life Assurance Company (South Africa) Ltd (4327/2017) [2018] ZAWCHC 135 (23 October 2018)
Republic of South Africa
IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
Case
No: 4327/2017
Before: The Hon. Mr Justice Binns-Ward
Hearing: 22 October 2018
Judgment:
23 October 2018
In
the matter between:
GUSTAV
ZIEHL t/a GUSTAV ZIEHL
MAKELAARS
Applicant
and
OLD
MUTUAL LIFE ASSURANCE COMPANY
(SOUTH
AFRICA)
LTD
Respondent
Order:
The applications for condonation of the applicant’s
non-compliance with the requirements of rule 31(2)(b) of the Uniform
Rules and for rescission of the judgment granted against him in
default of an appearance to defend the action are dismissed with
costs.
JUDGMENT
BINNS-WARD
J:
[1]
This is primarily an application in terms
of rule 31(2)(b) of the Uniform Rules for the rescission of a
judgment granted in favour
of the respondent against the applicant in
default of an appearance by the latter to defend the action the
former had instituted
against him. The rule requires that such
applications must be brought within 20 (court) days of the defendant
having knowledge
of the judgment. In the current case the
applicant obtained knowledge of the judgment when a writ of execution
was served
on 4 August 2017. He only launched the
application for rescission more than three months later, on 13
November 2017,
well outside the prescribed time limit. He has
accordingly also applied for the condonation of his non-compliance
that he
needs to be given if his rescission application is to be
entertained. The respondent opposed both applications.
[2]
One of the important considerations in the
determination of the application for condonation is the apparent
merit or lack thereof,
as the case might be, of the applicant’s
principal application. The inherent overlap of relevant
considerations requires
that both applications be looked at
integrally with due regard to their interrelationship.
[3]
In order to succeed it was incumbent on the
applicant in both applications to show good or sufficient cause for
the relief sought.
The concept defies precise definition, but
in the given context courts generally expect an applicant to show
good cause by (a)
giving a reasonable explanation of the default; (b)
showing that the application is made bona fide; and (c) showing that
there
is a bona fide defence to the respondent's claim which prima
facie has some prospect of success.
[1]
Bearing in mind that the court’s objective in exercising its
pertinent discretion is to give a just result in the peculiar
circumstances of the matter, the relative strengths of one aspect of
the applicant’s case in both applications might compensate
for
its relative weaknesses in other aspects.
[2]
A holistic evaluation is indicated.
[4]
The action concerned the recovery by the
respondent of certain commissions paid to the applicant. The
applicant was party
to a broking agreement with the respondent in
terms of which he was entitled to the payment of commission on
certain of the respondent’s
financial products that he sold to
the public. In terms of their agreement the applicant had a
commission account that fell
to be credited with commissions due to
him and debited when certain commissions paid to him in advance had
to be reversed due to
the failure or cancellation of the transactions
that he had brokered, or the discovery that any commission had been
paid incorrectly.
The commission account would obviously go
into debit if the sum of the reversed commissions at any time
exceeded the sum of any
new commissions that were still payable to
him at the time.
[5]
The contract provided that the applicant
would be liable to pay the respondent on demand any amount in which
his commission account
might at any time be in debit. It also
provided that the amount of the applicant’s indebtedness to the
respondent on
the commission could be established by means of a
certificate signed by any of the respondent’s designated
functionaries.
The effect of such certificate, should
litigation ensue, was to afford prima facie proof of the amount of
the indebtedness.
In the result the onus would be on the
applicant to prove that he was not indebted to the respondent in the
certified amount.
[3]
[6]
The effect of the certificate, which was to
do away with the need for any further affirmative evidence in support
of the quantification
of the sum claimed, was also to bring about a
situation that any claim supported by such a certificate qualified as
‘debt’
within the meaning of the phrase ‘debt or
liquidated demand’ in subrule 31(5) of the Uniform Rules.
I make this
point because, notwithstanding that such an application
had not been adumbrated in the papers, the applicant’s counsel
argued
from the bar that the application should actually be treated
not as one brought in terms of rule 31(2)(b), but instead as one
brought
in terms of rule 42(1)(a), which pertains to the rescission
of judgments ‘erroneously sought or erroneously granted in the
absence of any party affected thereby’. The basis for the
contention that the judgment had been erroneously sought
and/or
granted was an argument that the claim had not been in respect of a
‘debt or liquidated demand’ and therefore
not one that
the registrar had been empowered to enter judgment for in terms of
rule 31(5).
[7]
The applicant’s counsel relied on the
authorities cited in note 7 at page D1-371 [Loose leaf service 5,
2017] of Van Loggerenberg,
Erasmus:
Superior Court Practice
(Juta) in
support of the commentators’ note that ‘
It
was held that while a claim for an
account and debatement thereof can be a
“claim for a debt or liquidated demand”, a claim for
payment of the amount found
to be due after debatement of the account
is not a debt or liquidated demand
’.
The cited judgments that are centrally in point in this connection
are
SA Fire & Accident Insurance Co
Ltd v Hickman
1955 (2) SA 131
(C),
Allied Bakeries (Pvt) Ltd v Pitzar
1962 (1) SA 339
(SR) and
Fatti’s
Engineering Co Ltd v Vendick Spares (Pty) Ltd
1962 (1) SA 736 (T).
[4]
They do not support the proposition that counsel sought to make.
In both of the two first mentioned cases the plaintiffs
had claimed a
statement and debatement of account and payment of the amount
determined by such exercise to be due.
Ex
facie
the summonses in those matters,
the amounts payable by the defendants were expressly unliquidated,
hence the need for the accounting
and debatement that was sought.
Fatti’s Engineering
merely referred with approval to the judgment in
Hickman
.
Whether a summons makes out a claim for a debt or constitutes a
liquidated demand is something that must be discernible
on the face
of the pleading. Rule 31(5) would be unworkable if a
determination whether the claim was in respect of a debt
or
liquidated demand were dependant on considerations
dehors
the content of the summons.
[8]
The respondent in the current case was not
seeking payment of an amount to be determined after a statement and
debatement of account.
It claimed an amount of money the
quantum of which had been established prima facie in terms of a
certificate of balance by which
the applicant was contractually
bound. The claim was for payment of a debt in an amount that on
the face of the summons was
liquidated. The applicant’s
belated endeavour to characterise his application as one falling to
be disposed of in terms
of rule 42 was therefore without merit.
I shall accordingly persist in treating of it as an application in
terms of rule
31(2)(b).
[9]
The respondent sued the applicant for
payment of the sum of R1 851 922,76, being the alleged
debit balance on his commission
account together with interest
thereon as from 1 March 2017 to date of payment to be calculated
as provided in terms of the
brokers’ agreement. The quantum of
the respondent’s claim was supported by a certificate of
balance as provided for
in terms of the parties’ contract
signed by a senior administrative specialist in the respondent’s
Debt Recovery Unit:
Broker Distribution Unit. The certificate
was dated 6 March 2017. It had attached to it account
statements produced
by the respondent in respect of the applicant’s
commission account as at the last day of each month from November
2016 to
February 2017 inclusive. The account statements
reflected on an itemised basis how the amount claimed had been made
up, cross-referencing
in respect of each amount reflected on the
accounts (apart from amounts indicated as interest or legal expenses)
to an invoice
or credit note (
Afr.
‘Faktuur/Kredietnota’),
each of which was identified by date and document number.
[10]
In terms of the governing broking agreement
the applicant was entitled to payment by the respondent of the credit
balance in his
commission account at least once monthly. He was
also entitled to a commission statement, which could be furnished to
him
electronically, reflecting how the commission and/or fees had
been calculated. The applicant has testified that he is 74
years of age and is still working because he is unable to afford ‘the
luxury’ of retiring. It is inherently probable
therefore
that he would have kept a close eye on his commission statements on
at least a monthly basis. As will be evident
from what I shall
describe presently, he would have examined his commission statements
not only with regard to business that he
had conducted personally,
but also with an interest in the business that others had done
selling the respondent’s products
using his commission code so
that he could effect the 70/30 commission-sharing agreement
applicable in such cases.
[11]
In his supporting affidavit, the applicant
points out that the broking agreement does not expressly provide that
he was entitled
to a commission statement in respect of commission
reversals and submits that this ‘creates an unfair and
undesirable practice’.
There is, however, no substance in
the applicant’s construction of the relevant clauses of the
contract. Whilst the
express provisions might have been
usefully amplified for the sake of clarity, a proper construction of
the agreement clearly imputes
a tacit provision for the furnishing of
a commission statement when a debit is made. The system of
commission statements
is after all no more than one of periodic
reporting on the status of a running account. The accounts
attached to the respondent’s
summons provide real evidence of
how the system of commission statements worked. (That the
applicant sought to make the point
detracted from his case. It
gave the impression of someone desperately looking for defences,
instead of clearly advancing
those that he might actually have.)
[12]
The contract imposed an obligation on the
applicant to direct the respondent’s attention to any error in
the commission statements
provided or made electronically available
to him. In the event of his failure to do so in writing within
30 days of the availability
of the statements, he was contractually
deemed to have accepted the commission statements as correct.
The obvious implication
of this provision was an acceptance by the
parties thereto that the applicant would maintain his own records so
as to be able to
verify or challenge, as the case might be, the
commission statements rendered to him by the respondent. (The
keeping of such
records would in any event be a matter of sound
business practice, and something that he would have been obliged to
do in terms
of the income tax legislation.) The summons alleged
(in paragraphs 9 and 10 of the particulars of claim) that –
9. The commission statements produced by the plaintiff
in respect of the commission account, up to and including the
statement for
January 2017, were duly made available by the plaintiff
to the defendant together with the invoices/credit notes referred to
therein.
10. The defendant did not at any time report any error
in any such commission statement to the plaintiff.
[13]
The summons was served on the applicant on
10 March 2017. The applicant was already aware well before
then, however, that
there were problems with his commission account.
He avers that the summons came as ‘a bolt out of the blue’
because
he had been engaged in trying to resolve the issues with the
respondent’s management.
[14]
In this regard the applicant explained in
his supporting affidavit that at the suggestion of a certain Ms Karin
Koegelenberg,
a broker consultant employed at Halcypix (Pty) Ltd, a
business enfranchised by the respondent to provide service and
support to
independent financial advisors like the applicant, he had
agreed to assist certain unregistered persons to market the
respondent’s
products using his broker code on a commission
sharing basis. He averred that the arrangement had been that he
would pay
these so-called ‘sub-brokers’ 70% of the
commission earned in respect of the business generated by them,
whilst he
would retain the balance.
[15]
The applicant has conceded, as he had to,
that quite apart from the statutory contraventions that attended this
arrangement,
[5]
it had also been in breach of his contractual obligations to the
respondent.
[6]
He would not have been entitled to the payment of commission on
business written in breach of the relevant provisions of
his broking
agreement.
[7]
Accordingly any payments that he had received in this
connection were reversible by the respondent in terms of clause
19.1.1 of the agreement.
[16]
It is evident if regard is had to the
information on annexure PC4 to the respondent’s particulars of
claim, which the applicant
has not disputed, that the calculation of
the respondent’s claim is predicated on the reversal of certain
credits to his
commission account post August 2015. It is
evident if one compares the information on annexure PC4 to that
reflected on the
copies of the monthly commission statements annexed
as part of annexure PC5 to the particulars of claim that the detail
of the
reversals was to be found in the invoices identified by date
and document number on the commission statements. The
indications
on the evidence are that the relevant debits probably
constitute the reversal of commissions paid in respect of business
written
irregularly by certain ‘sub-brokers’ whom the
applicant had irregularly allowed to use his commission code.
The
applicant averred that he had relied on Ms Koegelenberg to
ensure that the required formalities were complied with, but, as
pointed out by the respondent, it was not open to the applicant to
raise any failure of his expectations in that regard against
the
respondent’s entitlement to reverse the commission payments.
He put himself at risk by breaching his contract with
the respondent
and allowing others to use his commission code.
[17]
It would appear that the respondent picked
up problems arising out of the applicant’s aforementioned
unlawful conduct in or
about October 2016, and that the applicant had
been informed accordingly at the time. It is common ground that
a meeting
was convened at the respondent’s offices on 2
November 2016 to discuss the irregularities that had been discovered
at that
stage in connection with four affected policies that had been
written under the applicant’s commission code. The
meeting
was attended by the regional manager of Old Mutual
Franchises, Mr Jonathan Perumal (who deposed to the respondent’s
principal
opposing affidavit in the applications), Mr Brent
Small, a forensic investigator in the respondent’s employ, Mr
Andries
Snyman, the manager of Halypix, and Ms Koegelenberg.
[18]
The applicant attached to his supporting
affidavit a copy of an email that he sent to Mr Perumal after the
meeting. The gist
of the email is that the applicant undertook
to regularise the registration and training of the ‘sub-brokers’.
Inconsistently, with what he described in his affidavit about
commission sharing, the applicant stated in his email to Perumal
that
‘
Ek doen dit slegs om hulle te
help en nie vir my eie gewin nie. Na 30 jaar in die bedryf, is
dit my misie (sic) om ander mense
te help en hulle ’n kans te
gee op sukses in die lewe
’.
[8]
[19]
The applicant’s commission account
was frozen as a consequence of the irregularities that had been
discovered. It appears
that he sought to investigate the
position and resolve the matter with the respondent. In this
regard he attached to his
supporting affidavit a copy of an email to
Mr Perumal, dated 2 December 2016, in which he reported that he was
making efforts at
progress in this regard. His email did not
make any complaint that he was being hampered by a lack of access to
his commission
account or the documents therein referred to.
[20]
It appears that Perumal scheduled a meeting
with the applicant for 13 December 2016, but subsequently
cancelled it, indicating
that it would be held instead in the new
year. The applicant wrote to Perumal enquiring when the
postponed meeting would
be rescheduled. His email, dated 6
January 2017, informed Perumal that he wished to clear the matter up
with the relevant
parties very urgently ‘
ten
einde alle ongerymhede (sic) asook knelpunte uit die weg te
ruim
’.
[9]
Once again, there was no indication by the applicant in his email
that he was being prejudiced by being unable to access
the
information on his commission account. This is significant
because the applicant had, on 3 January 2017, received correspondence
from the respondent reportedly informing him that his commission
account was in debit in the sum of just over R389 000.
He
did not attach a copy of this correspondence to his application, so
the court is not able to tell whether, or how, the aforementioned
information was supported by corroborative detail. The court
does, however, take notice that in his email, sent three days
after
he had been informed about the debit balance on his commission
account, the applicant did not complain about the absence
of the
information he would require to be able to understand it.
[21]
The respondent thereafter addressed a
letter of demand to the applicant, dated 23 January 2017, in which he
was informed that he
was indebted to the respondent on his commission
account in the sum of R1 189 835,26 as at 15 November
2016.
The letter stated ‘
With
regard to details of the debit balance, you would have been contacted
by your branch, Old Mutual Consultant and/or obtained
the necessary
information via your Gateway Internet Statement
’.
A copy of the letter of demand was later annexed to the summons.
[22]
In his apparent response to the letter of
demand – an email to Mr Perumal, dated 30 January 2017, a
copy of which was
attached to his supporting affidavit in the current
applications – the applicant requested the reactivation of his
broker’s
code ‘
sodat ons kan
vasstel of daar enige onreëlmatigheid plaasgevind het en ons
instaat te stel om van die polisse te herstel en
kontak te kan maak
met die kliënte. Indien daar enige een van die
verteenwoordigers wat deur my geregistreer is, betrokke
was by
onreëlmatigheid, hulle dadelik te rapporteer en te skraap by die
FSB. Ek kan alleenlik die polisse herstel indien
my kode
geaktiveer is en ons kan kontak maak met die kliënte. Ons
kan die hele situasie omdraai deur die kliënte
te besoek en
polisse herstel
’.
[10]
There was no mention or complaint by the applicant in the email that
he was unable to access his commission statements via
‘The
Gateway’ as indicated in the letter of demand.
[23]
It is evident that no response being
forthcoming from Perumal to his emails, the applicant sought to
arrange a meeting with him
through the good offices of Mr Andries
Snyman of Halcypix; apparently to no avail. Instead, summons
was served on him.
The trend of events can have left the
applicant under no illusion that his attempts to engage with the
respondent to that point
had made it in any way amenable to holding
back from pursuing the legal redress presaged in its 23 January
letter of demand.
[24]
The applicant stated that upon receipt of
the summons he had a meeting ‘
on
or about 14 March 2017
’ with the
aforementioned Brent Small, the respondent’s forensic
investigator. He claims (but Small denies) that
Small undertook
to ‘
walk over to the legal
department and arrange for the legal action to be stayed pending the
finalisation of Old Mutual’s investigation
’.
The applicant sought to explain his failure to enter an appearance to
defend on the grounds of Small’s (disputed)
indication that the
proceedings would be stayed and his belief that judgment would not be
taken against him whilst he was in the
process of co-operating with
Small in the investigation of the irregularities.
[25]
It is evident, however, from an email by
the applicant to Mr Perumal, dated 22 March, that the
applicant had subsequently
had a telephone conversation with Perumal
on 17 March, in which it appears he again pressed his request
for a meeting.
The following statement in his 22 March
email strikes me as inconsistent with any belief by him that his
alleged exchange
with Small on or about 14 March had resulted in
a stay of the action proceedings: ‘
Verder
sal ek dit hoog op prys stel indien ons die regsaangeleentheid van
die Hooggeregshof, soos per aanhangsel, vir eers kan uitstel
tot die
afhandeling van die ondersoek deur mnr Brent Small
’.
[11]
The applicant makes no mention of any response to his email that
might reasonably have led him to understand that his request
for a
stay of proceedings had been acceded to.
[26]
He also omitted any mention in his
supporting affidavit of a telephone call that he made to the
respondent’s attorney on 17 March,
or the advice given to
him by the attorney that if he disputed the claim he should consult
an attorney. In his replying affidavit
the applicant claimed,
unconvincingly, to have no recollection of the phonecall. In
the circumstances the probabilities favour
the truth of the
respondent’s evidence that Small had informed the applicant
that he was not able to stop the legal proceedings
and that the
applicant would have to pursue his request by dealing with Perumal.
That would explain why the applicant in
point of fact did that;
unsuccessfully.
[27]
In the context of his telephone
conversation with the applicant’s attorney and his failure to
elicit any favourable response
from Perumal to his request for a stay
of the proceedings, the applicant must have been acutely conscious of
his exposure to having
judgment taken against him should he not enter
an appearance to defend. His failure to give notice of an
intention to defend
the claim in those circumstances amounted to a
degree of recklessness approaching wilful default.
[12]
[28]
The applicant’s plea for
understanding on the basis that he was not versed in legal procedure
carries no weight. The
content of the summons that was served
on him spelled out clearly in language that any literate person would
easily comprehend
that if he failed to file and serve a notice of
intention to defend within the period stated therein judgment as
claimed might
be given against him without further notice.
[29]
No meetings were had with Perumal it would
seem. If there had been meetings, the applicant would no doubt
have mentioned them.
[13]
He did say that he met with Small on 17 May, when he ‘
provided
him with the details of all the sub-brokers
’.
He had further contact with Small ‘mostly on a weekly basis’
thereafter. The applicant gave no
indication of the substance
of these meetings. He also produced no evidence to suggest that
he had pursued the question of
obtaining access to his commission
statements and the documents to which they cross-referenced.
[30]
It appears from his supporting affidavit
that the applicant was confronted in early August 2017, just before
the service on him
of the writ of execution, with a set of ‘finalisor
declaration forms’ used by the ‘sub-brokers’.
He described these forms as documents that contain ‘client
information, policy information, including the policy number and
commencement date of the policy’. He said that such
documents had to be signed by the client, the sub-broker and by
himself. He acknowledged that some such documents had been
emailed to him for signature by Ms Koegelenberg, but alleged
that the number of finalisors presented to him by the respondent’s
forensic investigator, one James Calitz, substantially
exceeded the
number that he recalled having signed. He said that he
suspected ‘
that between
Koegelenberg and the sub-brokers some fraudulent policies might have
been loaded and processed under
[his]
broker code’
.
But if there were any policies of which he had no knowledge or was
unable to account for, he should have been able to identify
them from
the list of all the policies that had been issued under his broker’s
code that had been provided to him by the
respondent in March
2017.
[14]
[31]
The applicant does not contest the
respondent’s entitlement to have reversed commissions on his
commission account.
His ‘defence’, however, is that
he has been unable to determine from the summary of transactions on
the commission
statements attached to the summons ‘on what
basis the plaintiff has reversed or written back the commission that
[had been]
credited to [his] commission account’. He
averred that he had not been provided with any invoices from which he
would
be able to determine how the amounts reflected on annexure PC4
to the summons were computed.
[32]
I find the applicant’s claim to be
unable to indicate which of the reversals of commission should not
have occurred unconvincing.
It is evident on the papers that he
was provided with an abundance of information from which he should
have been able to make any
reconstruction necessary to challenge the
extent of his indebtedness to the extent that he was able. His
request for the
reactivation of his broker code was not to undertake
a reconciliation of what was due in terms of his commission account,
but to
attempt to reinstate certain policies that had lapsed or been
cancelled.
[33]
Of particular significance is the absence
of any evidence that after he had been given the commission
statements attached to the
summons that he had requested copies of
the source documents identified therein. In the absence of any
such requests, the
applicant’s complaint that he did not have
access to his commission account from November 2016 – a matter
that the
respondent has disputed - is feeble to say the least.
He also omitted to make any mention in his supporting affidavit that
he had on 22 March 2017, apparently in response to a request
addressed by him to Brent Small, been furnished with an ‘extract
of all the policies written under [his] code’. His
suggestion in reply that the information was ‘insufficient’
is implausible. The applicant should have been able to identify
from his own records, whether or not he was entitled to commission
on
the policies so identified,
[15]
and equally those in respect of which he was not. It is equally
apparent that the applicant should have been able to identify
any
discrepancies between the information supplied to him on a regular
basis by Ms Koegelenberg in respect of the policies
written by
the ‘sub-brokers’ and that evident from that given to him
by Small in March 2017.
[34]
But even if I were wrong in this respect,
it is notable that there is nothing in the evidence to indicate that
the applicant had
reverted to Small or anyone else in the
respondent’s employ for any further information to supplement
that which had been
provided to him so that he could undertake the
required reconciliation. The undertaking of a reconciliation was,
after all, the
rationale for the moratorium that the applicant
alleges he thought he had been afforded by the respondent in the
legal proceedings.
[35]
The applicant’s explanation for his
non-compliance with the prescribed time limit left much to be
desired. He engaged
a firm of attorneys to represent him
‘immediately’ after he had become aware of the judgment,
but subsequently terminated
their mandate before any application for
rescission had been lodged. He refrained from taking the court
into his confidence
as to why he dismissed these attorneys.
He dismissed the attorneys ‘in early September’.
The timing
coincided more or less with the expiry of the period that
had been afforded to him in terms of the subrule to institute the
proceedings.
He said that in order to minimise legal costs he
thereafter tried to make an appointment with Perumal to try to
resolve matters.
His approach to Perumal was only on
19 September, about a fortnight after the expiry of the time
limit for applying for a
rescission of the judgment. He was
advised on 20 September that Perumal would not agree to the
matter being held over
and that he should apply to court by close of
business on the same day for rescission if so advised. He said
that he approached
his current attorneys ‘in early October’
to apply for rescission of the judgment. He offers no cogent
explanation
for the delay between then and 13 November 2017,
when the application was eventually launched.
[36]
It should be apparent from what I have said
thus far that I have found the applicant’s explanations for his
failure to have
timeously entered an appearance to defend the action
and his omission to apply for rescission of judgment within the
prescribed
time period very weak and unpersuasive. I have also
not been satisfied that he has made out a bona fide defence. I
am conscious that in the latter respect the applicant did not have to
persuade me that he had good prospects of success in the principal
case. It would be sufficient if he were able to present facts
that on their face would show that he had a triable case.
[16]
He seems to concede on his papers that he has been unable to do that,
but sought to explain that his failure to do so should
be understood
in the context of a failure by the respondent to have sufficiently
accounted to him for the reversals. For
the reasons already
canvassed I am unpersuaded by the applicant’s allegation that
he has been hamstrung by a lack of information
from being able to
calculate the amount. The applicant has given him the
accounting that he was contractually entitled to,
and more. In
the circumstances the applicant’s failure to assert a factual
basis to disturb the effect of the certificate
of balance on which
the respondent relied means that he has failed to show that he has a
bona fide defence to the claim.
[37]
I have given some thought to the
appropriate order to be made in the context of my decision to refuse
the application for non-compliance
with the time limit prescribed in
subrule 31(2)(b). I considered whether, having refused
condonation, it might not be appropriate
merely to strike the
rescission application from the roll because in a sense a refusal of
condonation denoted that the court did
not have to engage with it.
Upon reflection, I have decided against that course and determined
rather that an order should
be made dismissing both applications.
I arrived at that conclusion because the uncondoned failure to comply
with the subrule
affords a basis in itself for the dismissal of the
rescission application, and also because a differentiated result in
two applications
that I identified at the outset required
adjudication integrally would be artificial. Moreover, a
striking off order carries
with it the suggestion that the matter
might be re-enrolled, whereas the intended result, premised on my
overall assessment of
both applications, is finality.
[38]
In the result the following order is made:
The applications for condonation of the applicant’s
non-compliance with the requirements of rule 31(2)(b) of the Uniform
Rules and for rescission of the judgment granted against him in
default of an appearance to defend the action are dismissed with
costs.
A.G. BINNS-WARD
Judge of the High Court
APPEARANCES
Applicant’s
counsel: M. Neser
Applicant’s attorneys: Von Lieres Cooper Barlow & Hangone
Cape
Town
Respondent’s
counsel: A.G. Christians
Respondent’s attorneys: Fairbridges Wertheim Becker
Cape
Town
[1]
Colyn v Tiger Food Industries Ltd
t/a Meadow Feed Mills Cape
[2003] ZASCA 36
;
[2003] 2 All SA 113
(SCA) at para. 11 (and the
other authority cited there).
[2]
Cf.
Wright
v Westelike Provinsie Kelders Bpk
2001 (4) SA 1165
(C),
[2001] 4 All SA 581
(C) at paras. 29 and
55-57. See also, for example,
Harris
v ABSA Bank Ltd t/a Volkskas
[2002] 3 All SA 215
(T),
2006 (4) SA 527
(T) at para. 10 and
Evander
Caterers (Pty) Ltd v Potgieter
1970 (3) SA 312
(T) at 316-317, where Boshoff J noted ‘
What
will justify a court in exercising its discretion in favour of the
party seeking the indulgence must depend entirely on the
circumstances of each particular case. If regard is had to the
purpose of the Rule, such a party should at least furnish an
explanation for the delay which led to the non-compliance with the
Rule which in the opinion of the court is sufficient or
satisfactory.
If the explanation is not sufficient or satisfactory,
then other considerations may become relevant and important, namely,
whether
the application is bona fide in the sense that the party
seeking the relief is really anxious to contest the case where he is
a defendant and believes that he has a good defence to the action
and whether in the circumstances the court can come to his relief
without any damage or injury to the plaintiff other than can be
remedied by an order as to payment of costs. If the court then
comes
to the conclusion that the application is a mala fide one, that the
defendant really has no belief in the justice of his
cause, but that
his only object in making the application is to delay the plaintiff
in obtaining his just claim, the court clearly
should not hesitate
to refuse to make any order
’.
[3]
See
Bank
of Lisbon International Ltd v Venter and Another
1990 (4) SA 463
(A) at 481H - 482C, read with
Senekal
v Trust Bank of Africa Ltd
1978 (3) SA 375
(A) at 382
fin
– 383.
[4]
Also reported at
[1955] 1 All SA 16
(C),
[1962] 1 All SA 44
(SR) and
[1962] 1 All SA 578
(T),
respectively.
[5]
The so-called ‘sub-brokers’
had not been appointed or authorised to act as financial service
providers or representatives
in terms of the Financial Advisory and
Intermediary Services Act 37 of 2002 (‘FAIS’).
[6]
In terms of clauses 6 and 7 of
the applicant’s contract with the respondent, he was
responsible for ensuring that the particulars
of any sales person
operating on his commission account were notified to the respondent
and he was forbidden to permit any such
person to market the
respondent’s products until the respondent had allocated him
or her a sales person’s sub-code
on the applicant’s
commission account.
[7]
Clause 6 of the agreement set forth
the following pertinent provisions in sub-clauses 6.1, 6.3 and 6.4,
respectively (‘die
Makelaar’ refers to the applicant and
‘OMMV’ to the respondent):
6.1 Die Makelaar moet ten opsigte
van elke verkoopspersoon, OMMV se standaardvorm ‘Besonderhede
van Verkoopspersoon’
voltooi sodra die verkoopspersoon deur
die Makelaar in diens geneem of aangestel word.
(Eng.
The broker must complete OMMV’s standard form “Particulars
of Salesperson” in respect of every salesperson
as soon as the
salesperson is taken into employment or appointed by the broker.)
6.3 Die Makelaar mag nie toelaat
dat ’n verkoopspersoon finansiële dienste ten opsigte van
die produkte lewer nie tensy
en totdat OMMV ’n
verkoopspersoon-subkode aan sodanige verkoopspersoon toegwys het
ingevolge klousule 7.2:
(Eng.
The broker may not permit a salesperson to provide financial
services in respect of the products unless and until OMMV has
allocated a salesperson-subcode to such salesperson in terms of
clause 7.2.)
6.4 OMMV mag nie vergoeding aan die Makelaar betaal
nie ten opsigte van aansoeke wat deur ’n verkoopspersoon
voorgestel
is:
6.4.1 indien die vereistes van
klousule 6.1 nie nagekom is nie;
6.4.2 indien OMMV geweier het om ’n
verkoopspersoon-subkode aan sodanige verkoopsperoon uit te reik;
6.4.3 wie se aanstelling deur die Makelaar beëindig
is; of
6.4.4 wie ingevolge FAIS verbied
of verhinder word om finansiële dienste te lewer.
(Eng.
OMMV may not pay any remuneration to the broker in respect of
applications presented by a salesperson:
6.4.1 if the requirements of clause
6.2 have not been complied with; or
6.4.2 if OMMV has declined to issue
such salesperson with a salesperson-subcode
6.4.3 whose appointment has been terminated by the
broker; or
6.4.4 who is forbidden or restricted in terms of FAIS
from providing financial services.)
[8]
‘
I only did it to help them
and not for my own profit. After 30 years in the industry, it
is my mission to help others, and
to give them a chance at success
in life.’ (My translation.)
[9]
‘…
to clear all
irregularities and obstacles out of the way’. (My
translation.)
[10]
‘…
so that we can
determine if any irregularity occurred and put ourselves in a
position to reinstate the policies and make contact
with the
clients. In the event that any of representatives registered
by me were involved in any irregularity [we will
be able to] report
them immediately to the FSB and have them struck off. I can
only reinstate the policies if my code is
activated and I am able to
contact the clients. We can turn the whole situation around by
calling on the clients and reinstating
the policies.
’
(My translation.)
[11]
‘
I should furthermore
appreciate it very much if we could hold over the legal proceedings
in the High Court, as per the attachment,
for the time being until
the investigation by Mr Brent Small has been completed.
’
(My translation.)
[12]
Cf.
Maujean
t/a Audio Video Agencies v Standard Bank of SA Ltd
1994 (3) SA 801
(C),
1994 2 All SA 394
(C) for a review of the cases
concerning wilfulness in the relevant context.
[13]
It does appear from the
opposing affidavit deposed to by Perumal that he had a meeting with
the applicant sometime in July 2017,
but nothing in the papers
suggests that anything of relevance transpired at it.
[14]
This is evident from the email from
Small to the applicant dated 22 March 2017, a copy of which was
attached as annexure JP1 to
Perumal’s opposing affidavit.
[15]
The applicant attached some sample
pages from the information supplied to him by Small as annexure GZ18
to his replying affidavit.
[16]
Cf. e.g.
Hassim
Hardware v Fab Tanks
[2017]
ZASCA 145
(13 October 2017) at para. 12, with reference to
Sanderson
Technitool (Pty) Ltd v Intermenua (Pty) Ltd
1980 (4) SA 573
(W) at 575H–576A.