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[2011] ZAGPJHC 89
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Standard Bank of South Africa Ltd v Hand (34066/10) [2011] ZAGPJHC 89 (3 August 2011)
SOUTH GAUTENG HIGH
COURT, JOHANNESBURG
CASE NO:
34066/10
REPORTABLE
DATE:03/08/2011
In the matter between:
THE
STANDARD BANK OF SOUTH AFRICA LTD
..
Applicant
And
ELSJE
HAND
..
Respondent
J U D G M E N T
HALGRYN, AJ:
[1]
The Applicant is Standard Bank of South Africa Ltd. It is
cited as a public company and credit provider duly registered
and
incorporated with limited liability in accordance with the laws of
the Republic of South Africa and in terms of the
National Credit Act
34 of 2005
trading,
inter alia
,
as bankers and financiers in terms of the provisions of Act 94 of
1990 (as amended).
[2]
The Respondent is one Elsje Hand, evidently a client of the
Applicant, who contracted with the Applicant in terms of
a written
“
Vehicle and asset finance FinRent
consumer agreement
”, which I will
deal with hereunder.
[3] The relief which the
Applicant seeks herein reads as follows:
1.
“
Confirming the
cancellation of the agreement entered into between the Applicant and
the Respondent and attached to the Applicant’s
founding
affidavit as Annexure “A”.
The Sheriff of the
above Honourable Court or his lawful deputy is authorised, directed
and empowered to attach, seize and hand over
to the Applicant the
vehicle, being 2007 Dihatsu Sirion 1.3 litre, engine number 1401402;
chassis number JDAM301S001019223
(“the vehicle”).
2.
Costs
of suit.
3.
The Applicant is given leave to
approach the above Honourable Court on the same papers duly
supplemented for payment on the difference
between the balance
outstanding and the market value of the vehicle in the event of there
being a shortfall after the vehicle has
been repossessed and sold or
released and there being a balance outstanding by the Respondent to
the Applicant.”
[4]
The Applicant’s claim is founded upon the aforesaid
written agreement, a copy of which is attached to the founding
affidavit marked “A”. In paragraph 6 of the
founding affidavit the Applicant set out to allege what the material
terms of the agreement are. It did so without at all indicating
which clauses of the agreement it is referring to, making
for very
difficult reading in order to compare the quoted portions with the
attached copy of the agreement, which in addition,
was illegible to
the extent that I was constrained to request a readable copy,
in
lieu
of which, I was going to strike
the matter from the roll.
[5] It is improper for a
litigant in motion proceedings, to simply attach a (lengthy) document
to an affidavit and then proceed
to quote therefrom without any
indication as to which paragraphs are indeed being quoted and to
expect of a Judge – in preparation
for the matter – to
struggle through what is often a quagmire of fine print, to check if
the quotes are in fact correct.
[6] It turns out that
had I not taken the trouble to do this exercise, I may have granted
relief herein, to which the Applicant
would not have been entitled.
[7] The particular
wording of the attached agreement – so it would appear –
is not unique to the Applicant. I
have personally witnessed the
exact same wording used by another bank in a separate matter. The
specific wording which I propose
to analyse and pronounce upon has
also been the cause of concern for some of the judges of this
Division. Mr Aucamp appearing on
behalf of the Applicant and Mr Van
der Merwe on behalf of the Respondent, assured me that there are many
pending applications in
this Division, concerning the same wording
and requested me to – notwithstanding their initial agreement
to postpone the
matter – write this Judgment in order to create
certainty.
[8] The defences raised
herein are many but I deal with one issue only i.e.: - Did the
Applicant prove that it cancelled the agreement?
[9] In paragraph 6.2 of
the founding affidavit the Applicant alleges:
“
Should
the Respondent commit any breach of the agreement, then the Applicant
would be entitled without prejudice to any other rights
it may have
against the Respondent to:
6.2.2
cancel the agreement,
take repossession of the vehicle, retain all payments already made in
terms of the agreement by the respondent
and claim as liquidated
damages, payment of the difference between the balance outstanding
and the market value of the vehicle,
which amount would be due and
payable forthwith;
”
.
[10]
This purports to be a quotation of clause 13.2.2 of the attached
agreement, but the Applicant misquoted it - by omitting to
allege the
words “…
after due demand
…
” before the words “…
cancel the agreement …
”.
This omission is material and impacts on the Applicant’s entire
cause of action herein. Incidentally
the same omission occurred
in paragraph 6.2.1, where clause 13.2.1 of the agreement was
purportedly quoted. Nothing turns on this
for the purposes of this
Judgment, save to record that the incorrect quotations are
inexcusable.
[11] It is trite that a
party wishing to rely on the cancellation of an agreement –
because of its breach – must allege
and prove:-
11.1. the breach of the
agreement;
11.2. that the right to
cancellation has accrued because the breach was material or in the
event that the agreement contains a cancellation
clause, that its
provisions have been complied with; and
11.3.
that clear and unequivocal notice of rescission was conveyed to the
other party, unless the agreement dispenses with
such notice.
[1]
[12] The learned author
took care to emphasise that:-
“
The
act of cancellation must be clear and unambiguous.
”
[2]
[13] The relevant
portions of clauses 13.2 and 13.2.2 of the agreement under
consideration provide as follows:-
“
Upon
an event of default … Lessor may … after due demand,
cancel this agreement, obtain possession of the vehicle
…
”
[14]
Given its normal grammatical meaning, the intention of the parties
in this clause is that upon default the Applicant may cancel
the
agreement “…
after due
demand …
”. Simply
put, the parties intended a logical flow of things i.e. breach –
demand – cancellation –
judicial process.
[15]
This seems simple enough until one is confronted with a “
definition
”
of “
due demand
”,
further on in clause 13.2.2, which reads as follows:-
“… ‘
due
demand’ shall mean ‘immediately on demand’ …
”
[16]
If I were to read “
immediately on
demand
” into “
due
demand
” the absurd result is
this:-
“
Upon
an event of default … Lessor may … immediately on
demand cancel the agreement…”
[18]
This would render the requirement of prior “
due
demand”
superfluous. This could
not have been what the parties intended. Upon a proper
construction of this clause, the parties -
in my view -
intended that in the event of the Respondent’s default, the
Applicant would give “
due demand
”
and only thereafter could the Applicant have earned the right to
cancel, by giving clear, unequivocal and unambiguous notice
thereof
to the Respondent.
[19]
By expressly requiring “
due
demand
” before cancellation, the
parties intended that effect be given to it. Christie states:-
“ …
if
the contract expressly requires demand or notice, the giving of which
then becomes part of the creditor’s cause of action.
”
[3]
[20] I pause to deal
briefly with demand, as it is not defined in the agreement, as far as
I could ascertain. In their still authoritative
work De Wet and Yates
state the following:-
“
Aanmaning
is ‘n kennisgewing deur die skuldeiser aan die skuldenaar gerig
waarin eersgenoemde laasgenoemde in kennis stel
dat hy voor of op ‘n
bepaalde dag moet voldoen.
”
[4]
[21]
In other words by expressly providing for “
due
demand
” in the agreement, the
parties intended:-
21.1. a notice
by the Applicant to the
Respondent;
21.2. in terms of which
the Applicant would notify the Respondent to perform and/or to
rectify the breach;
21.3.
before
or on a specific date.
[22]
It is so that demand can be effected by way of summons
(
interpellatio
iudicialis
)
or “
buitegeregtelik
”
(
interpellatio
extra iudicialis
),
i.e. by way of notice other than judicial procedure.
[5]
If
the Applicant intended this application to constitute
interpellatio
iudicialis
,
it did not allege that and even if it could be contended that nothing
needed to be stated in this respect, the Applicant could
not –
on my interpretation of clause 13.2.2 – have:-
22.1.
made “
due
demand
”; and simultaneously –
22.2.
give
clear, unequivocal and unambiguous notice of cancellation;
singularly - by way of
these judicial proceedings.
[23]
The parties clearly intended that due demand and clear, unequivocal
and unambiguous notice of cancellation should occur prior
to the
institution of judicial proceedings; or at the very least, that “
due
demand
” ought to have occurred
prior to the institution of judicial proceedings and if the Applicant
thereafter intended this application
to constitute “
clear,
unequivocal and unambiguous notice of cancellation
”,
it ought to have alleged that.
[24] I now turn to deal
with the manner in which the Applicant sought to prove the
cancellation in its founding affidavit.
After misquoting clause
13.2.2 of the agreement – as I have pointed out hereinabove –
the Applicant states the following
in paragraph 9 of the founding
affidavit:
“
The
Applicant in terms of the agreement has elected to cancel the
agreement, take repossession of the vehicle and claim damages.
The
Applicant seeks confirmation of the cancellation of the agreement and
the return of the vehicle in the present application.
”
[22]
The Applicant goes no further in the remainder of its founding
affidavit and the high watermark of what the Applicant states
in
respect of the cancellation of the agreement is thus that it “…
has elected to cancel the agreement …
”.
It does not allege that it had – as a fact – cancelled
the agreement, let alone how it did so or how
the cancellation notice
was conveyed to the Respondent in clear, unequivocal and unambiguous
terms. The Applicant also does
not state that it cancels the
agreement by means and in terms of this application and even if this
was its intention, it does not
allege that the cancellation was
preceded by “
due demand
”.
[23] It follows that the
Applicant failed to allege and prove that it had earned the right to
cancel the agreement and that it
had - as a fact - lawfully cancelled
the agreement. In the result the application has to fail.
In the premises I make
the following order:
1.
The
application is dismissed with costs.
L
P HALGRYN
ACTING
JUDGE OF THE SOUTH GAUTENG
HIGH
COURT, JOHANNESBURG
[1]
LTC
Harms;
Amler
’
s
Precedence on Pleadings
;
7th edition; Lexis Nexis; Durban; at page 115.
[2]
Supra
;
at page 115. In doing so Harms refers to the following
authorities:-
Swart
v Vosloo
[1965] 1 All SA 264
(A),
1965 (1) SA 100
(A);
Miller
& Miller v DickInson
[1971] 3 All SA 6O3
(A),
1971 (3) SA 581
(A);
Datacolor
International (Pty) Ltd v Intamarket (Pty) Ltd
[2000] ZASCA 82
;
[2001]
1 All SA 581
(A),
2001 (2) SA 284
(SCA) para.29;
Nedcor
Bank Ltd t/a Nedbank v Mooipan Voer & Graanverspreiders CC
[2002]
3 All SA 477 (T).
[3]
R H Christie;
The
Law of Contract in South Africa
;
5th edition; Lexis Nexis; Butterworths, at page 503. See
also
Henriques
v Lopez
1978 (3) SA 356
(W) at 358C.
[4]
Kontrakreg
en Handelsreg;
4th edition,
Butterworths, at page 145.
[5]
De
Wet and Yates
;
supra
,
at page 145.