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[2014] ZAGPJHC 327
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Mawere v S M M Holdings (Private) Ltd; InRe: S M M Holdings (Private) Ltd v Mawere and Another (20235/2006) [2014] ZAGPJHC 327 (2 May 2014)
REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG LOCAL DIVISION, JOHANNESBURG
CASE NO: 20235/2006
DATE: 02 MAY 2014
In the matter between:
MUTHUMWA DZIVA
MAWERE
.......................................................
Applicant
And
S M M HOLDINGS (PRIVATE)
LTD
............................................
Respondent
In re:
S M M HOLDINGS (PRIVATE)
LTD
................................................
Plaintiff
And
MUTHUMWA DZIVA
MAWERE
..........................................
First
Defendant
PARMANATHAN
MARIEMUTHU
.................................
Second
Defendant
J U D G M E N T
MAKUME, J:
[1] The applicant in this matter seeks
the following orders against the respondent:
1.1 That the judgment granted against
the applicant by His Lordship Willis J as he then was on the 11th
October 2012 be rescinded
and set aside.
1.2 Directing that a trial be held for
the consideration of new evidence.
1.3 Alternatively that the trial
between the parties be commenced de novo.
1.4 Granting the request for a
submission and hearing of new evidence at a trial between the
parties.
1.5 Staying any execution of a warrant
of execution against the applicant’s property pending the
finalisation of this application.
1.6 To the extent necessary condoning
the late filing of the rescission application.
1.7 That any party who opposes the
granting of the relief sought be ordered to pay the costs.
1.8 That such further and/or
alternative relief as the court may deem appropriate be granted.
[2] The application was argued over
three days. The notice of motion, answering and replying affidavits
besides annexures stretches
over 300 pages. The applicant generated
a mass of paper in this application in an effort to show that he has
a case worthy of
reconsideration. I have no hesitation to say right
at the beginning that the applicant’s case was misconceived
right from
the outset and was doomed for failure.
[3] A reading of the papers indicates
that this matter has gone a full circle. It commenced in this Court
with a full hearing in
the presence of the applicant during October
2012 before Willis J as he then was. It proceeded to the Supreme
Court of Appeal
wherein that court refused application for leave to
appeal. Then it next stopped at the Constitutional Court where once
more
leave to appeal directly to that court was refused. It is now
back where it started.
[4] Besides the route covered in this
matter there was a number of interlocutory applications leading up to
the date of hearing
in October 2012. These interlocutory
applications brought at the instance of the applicant all
cumulatively sought to exonerate
the applicant from liability. Some
of the applications were in the Zimbabwean High Court and others in
South Africa. I mention
hereunder such applications as they appear
from the document titled “Chronology of relevant events in
regard to the rescission
application”.
[5] It is common knowledge that during
September 2004 the respondent’s company was placed under
reconstruction in terms of
Zimbabwe Government Gazette General Notice
450A of 2004. This resulted in an administrator being appointed by
the Zimbabwean
Government to oversee the companies activities in
Zimbabwe.
[6] The reconstruction order was
confirmed by the High Court of Zimbabwe on the 15th December 2004.
On the 1st February 2011 the
applicant failed in his application to
the Supreme Court of Zimbabwe where he attacked the constitutionality
of the reconstruction
order. In February 2008 he launched a similar
attack in South Africa. Judge Campbell dismissed that application.
[7] The action instituted against the
applicant and a certain Marimuthu is in terms of section 424 of the
Companies Act No 61 of
1973. The Honourable Willis J found in favour
of the respondent and ordered the applicant and the said Marimuthu to
pay to the
respondent an amount of R18 million. It is that judgment
granted on 12 October 2012 which he seeks that it be rescinded.
[8] The record establishes that prior
to the final date of hearing the action had been postponed on at
least four occasions all
at the instance of the applicant. On the
day of the hearing itself there was no less than three applications
all by the applicant
directed at an attempt that the trial should not
proceed. This included an application that Willis J recuse himself.
[9] His Lordship Willis in his
judgment at paragraph [15] says the following in relation to the
strategies adopted by the applicant
then:
“Mr Kyle then proceeded to apply
for my recusal. He claimed that the issues in the special plea had
been predetermined and
that there was a clear bias in favour of the
plaintiff. After argument the application for recusal was dismissed
with costs. At
that stage I had not even read any of the documents in
the nine lever arch files before me, I had not even heard an opening
address.
I had no idea of the history of the matter and had merely
read the practice notes and annexures which had been filed. There
appeared
to me to be no legitimate grounds for my recusal. At that
stage I had no sense of the basket full of mambas with which I would
be presented during this case. The application for my recusal was the
mere beginning of a strategy of intimidation of the bench.”
[10] It is against this background that
I now turn to the merits of the application itself.
CONDONATION
[11] It is a fact that this application
was launched on the 13th August 2013 a period of ten months since the
judgment was granted.
That judgment was neither by default nor was
it in error. The application can accordingly not be in terms of Rule
42. It can
only be dealt with under the common law. Such
application should be brought timeously and proceed expeditiously.
See the matter
of Firestone SA (Pty) Ltd v Genticuro AG
1977 (4) SA
298
(A) at 306, First National Bank of South Africa Ltd v Van
Rensburg NO
1994 (1) SA 677
at 681.
[12] However, I will accept that the
applicant did not just sit and do nothing. He spent the time with
attempts to appeal the judgment
which decision was a right one and
only when this was unsuccessful he returned to base. It is because
of that only that I have
decided to grant condonation.
AD PRAYERS 1.1, 1.2, 1.3 AND 1.5
[13] In his notice of motion the
applicant seeks rescission of judgment to enable him to lead new
evidence at a trial that will
ensue should I set aside the judgment
as applied for.
[14] In terms of the common law and in
principle it has been a long-standing practice of our courts that two
essential elements
must exist to enable a court to set aside its own
judgment namely:
14.1 that the party seeking relief must
present a reasonable explanation;
14.2 that on the merits that party has
a bona fide defence which prima facie carries some prospect or
probability of success.
[15] In the matter of Chetty v Law
Society, Transvaal
1985 (2) SA 756
(A) at 764J the learned Miller JA
said the following:
“The appellant’s claim for
rescission of the judgment confirming the rule nisi cannot be brought
under Rule 31(2)(b)
or Rule 42(1) but must be considered in terms of
the common law which empowers the court to rescind a judgment
obtained on default
of appearance provided sufficient cause therefor
has been shown.”
[16] The main reason the applicant says
constitutes sufficient cause appears on paragraph 6 of his founding
affidavit which reads
as follows:
“6. This application for
rescission of a judgment is brought in terms of the common law on the
following grounds:
6.1 The applicant has since obtained
material evidence which was not available before the trial court,
which evidence would have
shed light on the matter and consequent
decision thereto by the honourable court.
6.2 There is also a good and just cause
as well as to why such material evidence was not available before the
court a quo nor was
it available to the applicant at the time in
order to allow the applicant to fully and appropriate vindicate its
defence in the
action against it in the trial court.
6.3 Further to the abovementioned
grounds there is a causal link between the circumstances that gave
rise to the original judgment
and the material evidence now sought to
be introduced to the court and the consequent relief sought in this
application.”
[17] Of significance is paragraph 6.2
of the applicant’s founding affidavit. The applicant having
said that he is expected
to set out in detail when such new material
or evidence came to his knowledge, in what manner and the reason why
he could not have
access to it earlier than now.
[18] The applicant says his concerted
efforts and attempts to secure the records of payments between SAS
and PETTER was unsuccessful
prior to the conclusion of the trial.
What the applicant does not tell us is why he did not issue a
subpoena or proceed in terms
of Rule 35 to compel discovery and the
production of that information which seems crucial for his defence.
[19] At paragraph 23 he says that he
eventually was provided with record of transactions by the liquidator
on the 25th May 2013.
Once more he does not tell the court what
method he used to get the record which he had been trying to get
since 2011. In the
absence of any explanation I have to accept that
the liquidators readily made the information available to him without
any difficulty.
[20] The next question that arises out
of the applicant’s information that he received the record the
new evidence on the
23rd May 2013 is why he did not bring this to the
attention of the Supreme Court of Appeal and/or the Constitutional
Court.
[21] The Supreme Court of Appeal
dismissed his application for leave to appeal on the 18th May 2013.
He has given no reason why
he did not bring this to the attention of
the court (SCA) before judgment was passed.
[22] In a recent decision by the
Supreme Court of Appeal the matter of AllPay Consolidated Investments
v CEO SASSA
2013 (4) SA 557
Nugent JA writing for the majority states
the following at page 559 paragraph [7]:
”[7] It is the practice of this
court that parties may not file new material after the hearing of an
appeal without the leave
of the court. There must be finality in
litigation and finality comes for the litigants once the appeal has
been heard. That was
conveyed to the attorneys of all the parties and
they were directed to refrain from doing so. The response from
AllPay's attorneys
was to ask our leave to file the application
formally. After reading the application we refused the request
because even on its
face, without hearing the other parties, there is
no possibility that the application could succeed.”
[23] Further in the same judgment the
learned judge continued as follows at page 560 paragraphs [13] and
[14]:
“[13] It has been said many times
that new evidence will be admitted on appeal only where the
circumstances are exceptional.
There would need at least to be an
acceptable explanation for why the evidence was not placed before the
court below …
[14] … It is also trite that the
evidence would need to be 'weighty and material'. (See Dormell
Properties 282 CC v Renasa
Insurance Co Ltd and Others NNO
2011 (1)
SA 70
(SCA). In S v N
1988 (3) SA 450
(A) at 458I-459A Corbett JA
pointed out that in the vast majority of cases new evidence has not
been allowed, and where it has
been allowed the evidence has related
to a single critical issue. In this case, if the evidence were to be
admitted, the parties
might just as well start the case over again.
What is now sought to be introduced is a new case entirely at odds
with the case
that was presented. What is more, far from being
weighty, the evidence carries no weight at all, and would not be
admissible.”
[24] The principle expounded in the
cases referred to above establish that new evidence is allowed not
only before an appeal is
heard but thereafter but before judgment as
long as that evidence is exceptional and there is an acceptable
reason given why such
evidence was not made available at the court a
quo.
[25] The litigation involving all the
companies wherein the applicant has a direct or indirect interest was
placed before me and
were dealt with by other judges. Amongst them is
the application brought by the respondent for the liquidation of
Southern Asbestos
Sales (Pty) Ltd (“SAS”). This
application was heard in this Division during the year 2005. The
cause of the liquidation
was the failure by SAS to pay to the
respondent the amount of US $18 464 595,27 the same amount which is
the basis of the cause
of action against the applicant. In the
liquidation application which was opposed by Mr Mawere the applicant
SAS raised all such
defences including the constitutionality of the
order placing SMM under reconstruction by the Zimbabwean Government.
[27] The learned Epstein AJ referred to
the two companies SAS and PETTER as the Mawera companies. The
applicant clearly controls
both companies directly and indirectly. In
dismissing the defence that SAS was not indebted to the respondent in
the liquidation
application the judge said the following at paragraph
[31] of the matter SMM Holding (Pvt) (Pty) Ltd v Southern Asbestos
Sales
(Pty) Ltd
2005 (4) All SA 584
(W) at page 594 paragraph [31]:
“There is, however, telling
evidence against SAS in regard to the indebtedness. I have already
referred to the judgment obtained
by PETTER pursuant to the alleged
cession. The facts are that on 6 May 2004 PETTER obtained an Order
against SAS for payment of
the amount R74 872 468,49. The cause of
action relied on by PETTER was based upon an allegation that SMM had
ceded this part of
its claim against SAS to PETTER. The Order was
rescinded on 29 November 2004. PETTER has, I was informed, not
pursued its case
against SAS. There is however no explanation by SAS
as to why it was prepared to consent to a judgment in favour of
PETTER in the
amount of R74 872 468,49 which claim arose by virtue of
an alleged cession to PETTER of part of SAS’s indebtedness to
SMM
in the current matter. One would have expected SAS which disputes
the indebtedness relied upon by an applicant in winding-up
proceedings
to be candid and forthcoming, which has not been the case
in this matter. It bears mention, of course, that both PETTER and SAS
are what can be referred to as ‘Mawere Companies’.”
[28] The reasoning referred to by
Epstein AJ was further strengthened by the finding of Willis J when
he went on to find that the
applicant Mr Mawere did not plead that
SAS had paid the R18 million to PETTER before Van Oosten J issued the
order of 6 May 2004.
Willis J went on to find that:
“Taken in context the first
defendant’s plea contains a clear admission that the payment of
some R18 million by SAS
to PETTER was effected consequent upon
judgment obtained per Van Oosten J on 6 May 2004.”
[29] The applicant never had a valid
nor bona fide defence to the claim by the respondent. It has failed
dismally to create a new
defence and has in the process abused the
legal system. This matter should have ended when the Supreme Court
of Appeal pronounced
on his prospects of success on appeal. In
saying so my conclusion rests upon not only my experience but also on
the experience
of other judges who dealt with this matter before me.
[30] The arguments advanced in support
of the applicant’s contentions are so far-fetched and legally
untenable that they require
no further consideration. The applicant
generated a mass of paper which serves little or no purpose save to
envelope the real issues
in the fog which hides or distorts
reality. The application to rescind as well as the application
to stay the
writ of execution including all the prayers in the Notice
of Motion must accordingly fail.
COSTS
[31] In the application the applicant
raised several issues which had been decided upon in previous
judgments for example the authority
of Mr Gwaradzimba as well as the
power of the Administrator under the Reconstruction Act of Zimbabwe.
These matters had been ventilated
in previous applications involving
the same parties and finality reached yet the applicant saw it fit to
raise them afresh
.
[32] The application itself served
before two judges on which instances all sorts of new material was
sought to be introduced for
instance after my Brother Francis J had
postponed the matter during October 2013 it served before Vilakazi AJ
on the 15th November
2013. It was on that day that the applicant
sought to introduce a supplementary affidavit which effort
was correctly
opposed by the respondent. This was yet another
act of adding more meaningless paper work. It is this conduct that I
have come
to the conclusion that it should be visited by a punitive
costs order as applied for by the respondent.
[33] I accordingly make the following
order:
1.The application for rescission of the
judgment by Willis J dated the 12th October 2012 is dismissed.
2.The application to stay execution of
the writ of execution including all the other prayers in the Notice
of motion are dismissed.
3.The applicant is ordered to pay taxed
costs of the application on an attorney and client scale.
4.It is further ordered that the costs
of the proceedings before Vilakazi AJ be paid jointly and severally
by the applicant Mr Muthumwaziwa
Mawere, his attorney Masewawatla
Attorneys and his counsel Adv N S Petla de bonis propriis the one
paying the other to be absolved.
M A MAKUME
JUDGE OF THE HIGH COURT OF SOUTH
AFRICA
GAUTENG LOCAL DIVISION, JOHANNESBURG
COUNSEL FOR APPLICANT ADV N S PETLA
INSTRUCTED BY MASEWAWATLA
ATTORNEYS
SUITE 211
83 ALBERT SISULU STREET
Cor VON BRANDIS, JOHANNESBURG
TEL: (011) 333 1955
COUNSEL FOR RESPONDENT ADV A C STEYN
INSTRUCTED BY EDWARD NATHAN
ATTORNEYS
150 WEST STREET
SANDTON
DATE OF HEARING: 05th March 2014
DATE OF JUDGMENT: 02nd May 2014