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[2018] ZAWCHC 177
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Vervoer NV De Nys v De Kock NO and Others (19662/18) [2018] ZAWCHC 177 (18 December 2018)
IN
THE HIGH COURT OF SOUTH AFRICA
[EASTERN CIRCUIT LOCAL
DIVISION, GEORGE]
Case
no. 19662/18
In
the matter between:
VERVOER
NV DE
NYS
Applicant
(Registration
no. 2016/481691/10
Incorporated
in Belgium)
and
ADV
GPC DE KOCK
N.O
First
Respondent
COMMUNITY
SCHEMES OMBUD SERVICE
Second
Respondent
THE
HILL HOUSE BODY
CORPORATE
Third
Respondent
DARON
QUINTON
SMIT
Fourth
Respondent
Heard: 28 November 2018
JUDGMENT
DELIVERED ON 18 DECEMBER 2018
SHER, J:
1.
This is an application for an Order staying the execution of a
so-called ‘adjudication order’ which was made by the
first respondent herein on 2 October 2018 in terms of the
provisions
[1]
of the
Community
Schemes Ombud Service Act,
[2
]
pending the outcome of an appeal which was lodged in respect of part
thereof.
2.
The Act
[3]
introduced a dispute
resolution service referred to as a ‘Community Schemes Ombud
Service’ for the resolution of disputes
between persons who
have a material interest in regard to the administration of any
‘community scheme’
[4]
which for the purposes of this matter includes sectional title
development schemes such as the one known as ‘Hill House’,
which is administered by the third respondent.
3.
The application is opposed by third and fourth respondents on the
limited grounds
[5]
that this
Court allegedly lacks jurisdiction to grant the Order sought and that
it is not one which the Court is competent to make
in terms of the
provisions of s 57(3) of the Act.
The factual
background
4. In September 2016 the
applicant acquired ownership of sections 13, 21 and 26 in the Hill
House scheme, together with an undivided
share in the common property
(being Erf 43 Plettenberg Bay and the buildings situated thereon), in
accordance with its
pro rata
share thereof, as per its
participation quota.
5. The land on which the
scheme is located is situated in Main Road, Plettenberg Bay in an
area which in terms of the applicable
municipal zoning and town
planning scheme is zoned for ‘business use’. According to
the Bitou Municipality this allows
for the property to be used ‘for
all manner of businesses’(sic). Given the zoning the Hill House
scheme is one which
allows for so-called ‘mixed’ use ie
both residential and commercial use. Consequently, sectional units on
the ground
floor are being used for a variety of business purposes,
whilst units on the floors above the ground floor are used as
residences.
6. Shortly after
purchasing its units the applicant decided to open a restaurant in
section 26. It originally envisaged a Belgian
beerhall themed
facility but after considering numerous objections which were lodged
by the Hill House body corporate and its members
it revised its
concept to a more conventional eatery.
7.
After obtaining all necessary municipal approvals and a liquor
licence the restaurant opened its doors on 1 January 2018. Some
4
months later, on 19 April the applicant received a notice in terms of
the Act
[6]
informing it that
fourth respondent, who is the owner of a section in Hill House in
which he lives, had made application for the
resolution of a dispute
which he had lodged in terms of Act 9 of 2011, in relation to the
operation of the restaurant, which
he alleged was being
conducted in a manner which constituted a nuisance to owners of units
in the scheme. After an unsuccessful
conciliation process the matter
proceeded to adjudication before the first respondent, who was
appointed by the Ombud (second respondent)
to adjudicate the matter.
Pursuant to a hearing which was held, on 2 October 2018 first
respondent made an order
[7]
directing the applicant to remove all water and gas pipes and gas
bottles which had been installed on the common property (in order
to
service the restaurant) within 14 days, and in the event that the
restaurant was thereafter still operational, directing the
applicant
to ensure that its service ended daily at 17h00 and that it closed
its doors by 18h00, in order to prevent the ‘creation
of a
nuisance’ (sic). The directive to remove the water and gas
installations from the common property was based on a finding
that
the applicant had failed to obtain the necessary prior consent for
the installation from the owners of units in the scheme.
8. On 29 October 2018 the
applicant lodged an appeal (with the Registrar of this Court in
George), against the second part of the
order ie the directive in
regard to daily termination of service and closure of the restaurant.
It did not lodge an appeal in respect
of the directive that it was to
remove all water and gas installations from the common property.
Simultaneously therewith it sought
an undertaking from third and
fourth respondent that execution of the entire adjudication order
would be stayed in its entirety,
pending the appeal, but the
respondents were not willing to accede thereto.
Jurisdiction
9.
Jurisdiction is the power or ‘competence’ which a court
has to hear and determine a dispute, and to give effect to
any
judgment or order it may make pursuant thereto. Where jurisdiction is
placed in issue in relation to the
subject
matter
of a dispute, whether a court is competent to adjudicate it is
determined by the nature of the proceedings and the relief sought
[8]
therein. It is thus determined on the basis of the pleadings
[9]
from which the court must construe what the essence or basis is of
the legal issues which require resolution.
[10]
10.
Insofar as the court’s power or competence may be challenged in
relation to the
parties
before it, the Superior Courts Act
[11]
provides that a division of the High Court shall have jurisdiction
over all persons residing or being within its (statutorily defined)
territorial area of jurisdiction.
[12]
In addition, the Court will also have incidental jurisdiction over
any person who is outside of its territorial area of jurisdiction
where such person is joined as a party to any cause in relation to
which the Court has jurisdiction.
[13]
11. The respondents
contend that this Court lacks jurisdiction on a number of grounds.
These pertain both to the subject matter
of the dispute in the
appeal, as well as to the parties before the Court.
12.
Although it is common cause that both third and fourth respondent as
well as the immovable property of which section 26 forms
part are
physically located in Plettenberg Bay, which falls within the
territorial area of jurisdiction of this Court,
[14]
the respondents claim that because the first respondent is an
adjudicator who resides and works in Cape Town, and was engaged by
the second respondent from its regional office in Cape Town, which
falls ‘outside’ of this Court’s area of territorial
jurisdiction as a Circuit Court, and the appeal concerns proceedings
which were held before him and in relation to which he made
a
decision and an order pursuant thereto in Cape Town, this Court, as a
Circuit Court sitting in George, cannot entertain the matter.
However
during argument the respondents conceded that the fact that the
second respondent is a national public entity
[15]
which has a national head office in Sandton, Johannesburg and
regional offices in certain provinces, including the Western Cape,
and that it makes use of adjudicators from Cape Town which it
appoints for the purpose of resolving disputes (and who might make
determinations in Cape Town), will not necessarily serve as a bar to
it being cited and brought before this Court, provided the
Court has
jurisdiction over the person of certain of the other parties before
it, and the cause which is before it.
13. In seeking to develop
the non-jurisdiction argument further respondent’s counsel
contended that as the appeal against
first respondent’s
adjudication order was lodged with the Registrar of this Court,
whilst it was sitting on Circuit in George,
it was defective as this
Court could not hear the appeal because it did not have the statutory
power to hear appeals, and it was
only the Western Cape division
sitting in Cape Town which could do so. Thus, it was submitted this
Court had no power to interdict
the operation of the adjudication
order pending the appeal.
14.
The Superior Courts Act provides that a division of the High Court
has the power to hear and determine appeals
[16]
and reviews
[17]
from all
magistrates’ courts which fall within its area of territorial
jurisdiction. The respondents point out that the Superior
Courts Act
further provides
[18]
that,
except where it is in terms of any law required or permitted to be
otherwise, for the hearing of any appeal a court of a
division must
be constituted before 2 judges, whereas in contrast to this the Act
provides that a circuit court of a division must
be presided over by
a single judge.
[19]
15.
In the light of these provisions Erasmus
[20]
is of the view that inasmuch as the Act does not provide for a
circuit court to be constituted before more than one judge, in
discharging its duties it therefore cannot hear appeals or any other
cases where a
quorum
of 2 or more judges is required. However, in
Nedbank
v Norris
[21]
Goosen J held that a Circuit Court (in casu the Port Elizabeth local
division of the Eastern Cape division) constituted a court
of a
Division, within the meaning of s 14 of the Act, and as such it
exercised the authority of the Division, irrespective of where
it
sat, and provided it was constituted in accordance with the numbers
required, it could hear appeals or reviews at its local
seat.
16. In an attempt to
further rebut this part of the respondents’ argument the
applicant points out that the appeal which it
has lodged is not an
appeal
strictu sensu
in the traditional sense of the word in
terms of the Superior Courts Act and the Rules of Court, but a
limited statutory right of
‘appeal’ on a point of law
which is afforded to it in terms of the provisions of
s 57
(3) of the
Community Scheme Ombud Services Act.
17. It
point outs that in
The
Trustees, Avenues Body Corporate
v
Shmaryahu & Ano
[22]
Binns-Ward
J recently held
[23]
that such
an appeal was not a civil appeal within the meaning of the Superior
Courts Act but was more in the nature of a review
ie a hearing
limited to determine, not whether the decision under ‘appeal’
was correct or not but simply whether the
decision-maker had
exercised his powers and discretion ‘honestly and properly’
in relation thereto. Consequently, they
submitted that there was no
statutory bar to a single judge hearing an appeal in terms of s 57(3)
of Act 9 of 2011.
18.
Although the Superior Courts Act does not contain a similar 2 judge
provision in relation to the composition of a Court which
entertains
reviews, in practice these are also ordinarily heard by 2 judges,
[24]
save for certain reviews in criminal matters.
[25]
In the circumstances the submission that because a right of appeal in
terms of s 57 of Act 9 of 2011 is really a right of review
(and can
therefore technically be heard by a single judge, and by extension
therefore by a judge of the Western Cape Division whilst
on circuit),
does not avail the applicant.
19.
The fact that the appeal was lodged with
this Court, in George, whilst it was completing its Circuit, and not
with the (Western
Cape) Division in Cape Town, could well be said to
be of no moment inasmuch as this Court is merely an extension of the
Western
Cape Division, exercising its powers on Circuit. As such, the
appeal could well be considered to have been lodged with the Division
before which it is to be heard, even though it was filed in George
instead of Cape Town.
However, in my
view it is not necessary to make a finding on this aspect, or on
whether this Court can be constituted to hear a
review as a Circuit
Court, as I believe that the respondents have misconceived the test
which has to be applied in relation to
the jurisdictional point.
20.
In this regard it is important to remember that as far as the subject
matter of the proceedings which are before me is concerned,
the
pleadings and issues arising therefrom are phrased in interdict
terminology. As the papers stand therefore the question which
must be
posed is whether this Court has the jurisdiction ie the power or
competence, to grant the applicant an interdict, pending
the appeal
which it has lodged, irrespective of whether or not the appeal can
and will be heard by this Court, on Circuit, or whether
it will need
to be heard in Cape Town by the division from which this Court has
been despatched to exercise that Court’s
authority whilst on
Circuit.
[26]
21.
In terms of the Constitution
[27]
this Court has the inherent power to regulate its processes, and as
such it is well-established law that it has the power to grant
an
Order staying proceedings in another matter, pending the
determination of a material issue in such proceedings, before
another forum.
[28]
In relation
to interdict proceedings it has been held that a Court will have
jurisdiction if the requirements for an interdict
are satisfied by
facts that exist within the territorial area of jurisdiction of the
Court.
[29]
In my view, all the
material facts necessary for consideration of whether or not an
interdict should be granted, fall within the
territorial area over
which this Court has jurisdiction. In the first place the ‘order’
which is sought to be stayed
is an adjudication order which if not
stayed will need to be carried out in respect of immovable property
which is situated in
Plettenberg Bay, within the territorial area of
jurisdiction of this Court, and in respect of which property the
applicant, and
third and fourth respondents (who are all ‘resident’
in the same jurisdictional area) have an interest, or rights. In
the
second place, the interdictory Order which is sought is one
restraining the third respondent body corporate, which administers
the Hill House scheme in Plettenberg Bay, from being allowed to
execute the adjudication order, whereby certain water and gas
installations on the common property of the scheme are to be removed,
and preventing it from compelling the restaurant which is
operating
from section 26 of the scheme, to terminate its service and to close
by no later than 18h00 each day. To this end the
relief which is
sought is based on the essential averments that the applicant has a
prima
facie
right (this is based on the statutory right of appeal it has and the
developmental rights allegedly afforded to it in terms of
the zoning
scheme, in respect of which it alleges the first respondent erred in
law), that it will suffer irreparable harm in the
event the Order is
not granted to it (because without such an Order its restaurant will
effectively become commercially unviable
and will have to close its
doors permanently, as its principal source of income is derived from
trading in the evenings), that
the balance of convenience is in its
favour (in this regard it points to the fact that the respondents
will suffer minimal harm
in the event that they are compelled to
tolerate the restaurant being open at night until the appeal is
heard, whereas in the event
that the adjudication order is put into
operation the applicant will suffer immeasurable financial
prejudice), and finally, that
it has no reasonable, alternative
remedy available to it. Although the respondents dispute that the
applicant has made out a proper
case for an interdict, they do not
have any real answer to the assertions which are made by the
applicant in support of these elements,
and in respect of these
assertions the respondents’ answer is largely a simple denial.
Conclusion
22. In the circumstances,
based on the papers before me I am of the view that this Court has
the necessary jurisdiction both in
regard to the parties as well as
in relation to the subject matter of the proceedings.
23. There is one final
aspect that needs to be attended to. The respondents contend that,
inasmuch as the applicant is only seeking
to appeal against the
second part of the adjudication order ie the directive pertaining to
the restaurant’s operating hours,
it cannot obtain an order
staying execution of the entire order. In this regard they point out
that s 57(3) of Act 9 of 2011 provides
that a person who appeals
against an (adjudication) order which is made in terms of the Act may
also apply to the High Court to
stay the operation
of such order
,
to ‘secure the effectiveness of the appeal’. The
respondents contend that given this provision, the applicant cannot
apply for an Order to stay something which it is not appealing.
24. The applicants have
lost sight of the fact that the application for a stay has been made
not only on the basis of the statutory
power which the Court has in
terms of s 57(3), but also on the basis of the power which the Court
has at common law to interdict.
In its founding affidavit the
applicant made it very clear that it was seeking to rely on both, and
as pointed out above, it dealt
at some length with the requirements
for an interdict in its papers. It avers that in the event that it
succeeds on appeal and
the directive that it is to close its
restaurant daily by 18h00 is set aside, it will then be able to make
application to the body
corporate for permission to retain its gas
and water installations on the common property, and were the Court
not to come to its
aid by making an interim Order staying the
operation of the entire adjudication order, it could then be
compelled to remove these
installations, which would in effect result
in it not being able to operate its restaurant at all. This would
effectively emasculate
its statutory right of appeal.
25. As far as costs are
concerned, I am of the view that the appropriate Order to make is
that these should stand over for determination
at the appeal. It will
be the appeal court which will be in the best position to determine
whether these proceedings were warranted
or not, after it has duly
considered all the relevant circumstances.
26. I make the following
Order:
26.1
Execution of the adjudication order which was made by the first
respondent on 2 October 2018 in terms of ss 39(2)(a) and (d)
of the
Community Schemes Ombud Service Act 9 of 2011, shall be stayed,
pending the outcome of the appeal which the applicant has
launched in
respect thereof in terms of s 57(1) of the Act.
26.2
The costs of this application shall stand over for determination at
the hearing of the appeal.
SHER
J
Appearances:
Applicant’s
counsel: AF Schmidt
Applicant’s
attorneys: Jordaan & Smith Attorneys
(Plettenberg
Bay)
Third
and Fourth Respondents’ counsel: DL Van Der Merwe
Third
and Fourth Respondents’ attorneys: HDRS Attorneys Inc
(Plettenberg
Bay)
[1]
To wit ss 39(2)(a) and (d).
[2]
Act 9 of 2011.
[3]
Which
came into operation together with, and on the same date as, the
Sectional Titles Schemes Management Act 8 of 2011.
[4]
D
efined
in s 1 as any scheme or arrangement in terms of which there is
shared use of, and responsibility for, parts of land and
buildings.
[5]
A complaint that the deponent to the founding affidavit lacked
authority to depose thereto was abandoned and not proceeded with
at
the hearing of the matter.
[6]
S 43.
[7]
I
n
terms of s 39(2)(a) and (d) of the Act.
[8]
Estate
Agents Board v Lek
1979 (3) SA 1048
(A) at 1063F;
Gallo
Africa Ltd v Sting Music (Pty) Ltd
2010
(6) SA 329
(SCA) at para [6].
[9]
Chirwa
v Transnet
[2007] ZACC 23
;
2008 (4) SA 367
(CC) at 425E.
[10]
Gcaba v
Minister of Safety & Security
2010 (1) SA 238
(CC) at 263C.
[11]
Act 10 of 2013.
[12]
S 21(1).
[13]
S 21(2).
[14]
Ordinarily a Court in whose area of jurisdiction an immovable
property is situated (as the forum
rei
sitae
)
has the jurisdiction to deal with any legal action in connection
with that property, including any ancillary claim or proceeding
in
relation thereto.
[15]
In
terms of s 3 of Act 9 of 2011 it is an entity listed in terms of the
Public Finance Management Act and its executive authority
is vested
in the Minister of Human Settlements.
[16]
S 21(1)(a).
[17]
S 21(1)(b).
[18]
In s 14(3).
[19]
S
7 (2).
[20]
Superior
Court Practice
A2-10E.
[21]
2016 (3) SA 568 (ECP)
[22]
2018
(4) SA 566 (WCC).
[23]
Id
para [1], r
elying
on the distinction made in
Tikly
v Johannes
1963 (2) SA 588
(T) at 590-591, between (i) an appeal in the wide
sense, which allows for a complete rehearing and a fresh
determination on the
merits of the matter and (ii) an appeal in the
‘ordinary strict’ sense ie a re-hearing on the
merits and a
determination limited to whether the decision was right
or wrong and (iii) a review ie a limited rehearing not as to whether
the decision was correct or not but whether the decision-maker
exercised his powers and discretion 'honestly and properly'.
[24]
Cf
The
Trustees, Avenues Body Corporate
which
concerned an appeal in terms of s 57(1) of the Community Schemes
Ombud Service Act, which was heard by two judges.
[25]
Such as so-called ‘automatic’ reviews in terms of
ss
302
-
303
of the
Criminal Procedure Act 51 of 1977
, which are
considered to be akin to a statutory right of appeal for
unrepresented accused who are convicted and sentenced by
magistrates
of less than 7 years’ experience to imprisonment exceeding 3
months or to fines in excess of R6000.
[26]
According
to Erasmus n 20 while a Circuit Court is sitting it can exercise all
the powers which the division in which area it
was established can
exercise.
[27]
S 173.
[28]
Mokone
v Tassos Properties CC
2017(5)
SA 456 (CC) at 475B-477F.
[29]
Zokufa
v Compuscan (Credit Bureau)
2011
(1) SA 272
(ECM) 282G-I.