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[2017] ZAGPJHC 264
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West Wing Sports Bar CC and Another v Investra CC (11354/2015) [2017] ZAGPJHC 264 (1 May 2017)
REPUBLIC
OF SOUTH AFRICA
HIGH
COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO: 11354/2015
Not
reportable
Not
of interest to other judges
Revised.
1
May 2017
In
the matter between:
WEST
WING SPORTS BAR
CC
First
Applicant/Defendant
UGBOKE,
HENRY
OSAGIE
Second
Applicant/Defendant
and
INVESTRA
CC
Respondent/Plaintiff
JUDGMENT
Barrie
AJ:
1.
The first and second applicants (“the applicants”),
respectively West Wing Sports Bar CC (“West Wing”)
and Mr
Henry Osagie Ugboke (“Mr Ugboke”) apply for rescission of
a judgment given against them on 24 June 2015, jointly
and severally,
for payment of R211 372,32, plus interest and costs.
2.
Mr Ugboke is the only member of West Wing.
3.
The respondent is Investra CC (“Investra”), the plaintiff
in whose favour the court granted judgment.
4.
Investra is the owner of premises situate at 237 Anderson Street,
City & Suburban, Johannesburg (“the premises”).
Its cause of action against West Wing was non-payment of rentals and
other charges that were payable in terms of a written lease
of the
premises (“the lease”) that commenced on 1 March 2014.
Investra’s cause of action against Mr Ugboke
was a deed of
suretyship (“the suretyship”) in terms of which Mr Ugboke
bound himself as surety for and co-principal
debtor with West Wing
for the latter’s obligations to Investra in terms of the lease.
5.
West Wing and Mr Ugboke chose the address of the premises as
domicilium citandi et executandi
in terms of respectively the
lease and the suretyship.
6.
Investra instituted the proceedings against the applicants by notice
of motion that its attorneys caused to be served at the
premises.
In terms of the deputy sheriff’s returns of service the
application documents were served at the premises
on 31 March 2015 by
service on a Mr Funduyagi. The returns of service evidence
proper service in accordance with rules 4(1)(a)(iii)
and (iv) of the
Uniform Rules of Court.
7.
The applicants did not give notice of their intention to oppose the
matter. According to Mr Ugboke’s founding affidavit
in
support of the rescission application, that was because the documents
that the deputy sheriff had served at the premises did
not come to
his notice. In these circumstances this court gave judgment
against West Wing and Mr Ugboke on 24 June 2015 after
the matter had
been set down for hearing in accordance with rule 6(5)(c).
8.
Mr Ugboke became aware of the judgment by no later than 24 July
2015. The applicants instituted their application for
rescission on 10 March 2016.
9.
Rescission of a judgment given by default in application proceedings
potentially arise either in terms of the provisions of rule
42, or at
common law. Rule 31(2)(b) does not apply – it
applies only in respect of default judgments that
the court grants in
actions (if a defendant is in default of delivery of notice of
intention to defend or of a plea).
10.
The applicants’ application for rescission cannot succeed under
rule 42 – the applicants have not made
out any case
pertaining to the grounds for rescission or variation of an order or
judgment specified in rule 42(1). In the
circumstances the
applicants have to show good cause for rescission of the court’s
order at common law, encompassing, in
principle, their providing a
reasonable and acceptable explanation for the default and to show
that they have a
bona fide
defence against Investra’s
claims.
11.
In Mr Ugboke’s founding affidavit he raises three potential
defences against Investra’s claims.
12.
The first two potential defences that Mr Ugboke puts forward relate
to West Wing’s obligation to pay for water and electricity
used
at the premises. The obligation arose in terms of clause 10 of
the lease agreement that provided, among others, that:
“
The Tenant
shall:
10.1. …
10.2. in addition to
monthly rental, pay for:
10.2.1. all
electricity, gas, water, used by the Tenant in or on the Premises as
recorded by means of a pro rata share of the total
charge for
electricity, gas and water used in the building of which the Premises
form part, in respect of the electricity, gas
and water used by the
Tenant in or on the Premises; The Tenant shall notify the Landlord
immediately should any such electricity
or water supply to the
Premises cease or become defective or interrupted.
10.2.2. all
sewerage/effluent, sanitary services, refuse removal services and
special refuse removal services in respect of or attributable
to the
Premises.
”
13.
Mr Ugboke says, firstly, that in terms of an oral agreement and
understanding reached with Investra, West Wing was entitled
to
receive copies of municipal accounts rendered in respect of the
premises to enable him to verify the water and electricity charges
that Investra levied against West Wing.
14.
In its answering affidavit Investra concedes that the applicants
would have been entitled to copies of the municipal accounts,
but
avers that the applicants never requested these to be supplied until
early in January 2016, when the documents were requested
and were
then supplied.
15.
Mr Ugboke avers in his replying affidavit that the municipal accounts
he received (only on 18 February 2016) were incomplete,
stating that
he did not receive copies of, among others, the municipal statements
for January and February 2014 (i.e. the two months
preceding
commencement of the lease) and March 2014 (i.e. the first month after
commencement of the lease).
16.
Mr Ugboke avers, secondly, that on receipt of the copies of the
municipal accounts in 2016, he noticed charges on these accounts
that
preceded commencement of the lease. He states that the
applicants are not liable for such charges.
17.
Investra in its answering affidavit denies that any charges levied
against West Wing included billings for electricity and other
consumables that arose prior to the date of West Wing’s taking
occupation.
18.
Mr Ugboke does not, whether in his founding or replying affidavit,
provide a breakdown of any sort of payments that the applicants
made
to Investra from the inception of the lease for rent and the charges
that were levied for water, electricity and the like,
referencing
these to the municipal accounts that he received in January 2016, to
show that the sum in respect of which the court
granted judgment is,
in some way or another, overstated. Taking into account that Mr
Ugboke alleges that he did not receive
copies of the municipal
statements for January, February and March of 2014, he, moreover,
does not in his replying affidavit explain
how he came to the
conclusion that Investra had charged the applicants in respect of
water and electricity that related to any
period prior to
commencement of the lease.
19.
The third potential defence that Mr Ugboke raises is that, because
Investra’s representatives did not inform him that
the premises
were zoned “
Business & Commercial
” and not
“
Residential
” when he concluded the lease on
behalf of West Wing, they, in effect, misled him, in so doing
inducing him to conclude a
lease that he would, otherwise, not have
agreed to.
20.
Mr Ugboke avers in this regard that clauses 1.3 and 8 of the lease
show that the premises were let for “
residential
”
purposes. According to Mr Ugboke he only learnt when he
received the municipal accounts that the premises were zoned
“B
usiness & Commercial
” which meant that the
municipality charged higher rates than would have been charged if the
premises had been zoned for residential
purposes. Mr Ugboke
says that Investra’s representatives never informed him of the
actual zoning of the premises when
the lease was concluded and that,
if he had known of the actual zoning, he would never have concluded
the lease.
21.
Clauses 1.3 and 8.1 of the lease do, indeed, provide that the
premises were to be used for residential premises. It is
also
common cause that a major part of the premises was from inception of
the lease occupied by subtenants, from whom West Wing
collected
rent. Mr Ugboke, nevertheless, states in his founding affidavit
that he agreed with Investra’s representatives
that portion of
the premises would be used by his brother for a motor vehicle repair
and service workshop, i.e. for purposes other
than residential
purposes.
22.
I find that the defences that Mr Ugboke suggests in his founding
affidavit do not provide a
bona fide
basis for the applicants’
defending the claim or for my rescinding the judgment of 24 June
2015.
23.
Firstly, even if Investra failed to provide copies of municipal
accounts to the applicants in breach of a side agreement to
the
effect that such copies would be provided, it has no bearing on the
validity of the judgment.
24.
Secondly, Mr Ugboke does not make out any case from which it can be
concluded that any part of the sum for which judgment was
granted
arose from water, electricity or other charges that Investra had
inappropriately charged to West Wing, that were not actually
owing.
25.
Thirdly, although Mr Ugboke suggests that Investra was under some
obligation to inform him, representing West Wing, of the actual
zoning of the property, he avers no basis for the existence of such
an obligation of disclosure. Taking into account that
the
premises are situate in downtown Johannesburg and it is common cause
that part of the premises was going to be used for commercial
and
business purposes by agreement with Investra, there is no potential
basis for finding that such an obligation did arise.
26.
In the circumstances, it is not necessary for me to make any findings
regarding whether the applicants provided a reasonable
explanation
for their failure to deliver notices of intention to oppose
Investra’s application and whether they have satisfactorily
explained the lapse of time of approximately eight months that
occurred from when Mr Ugboke became aware of the judgment until
the
applicants prosecuted the application for rescission thereof.
27.
In these premises the applicants’ application for rescission of
the judgment granted agains them under the above case
number on 24
June 2015 is dismissed with costs.
________________________________
F.
G. BARRIE
ACTINGJUDGE
OF THE HIGH COURT
APPEARANCES:
FOR
THE APPLICANTS:
B MARAIS
Instructed by BDK
ATTORNEYS
FOR
THE RESPONDENT:
A J VENTER
Instructed by TREVOR
SWARTZ ATTORNEYS
DATE
OF HEARING:
27 October 2016