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[2010] ZAGPJHC 185
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Absa Bank Ltd v Ms T van Rie t/a Amazing and Others (13800/2000) [2010] ZAGPJHC 185 (8 June 2010)
SOUTH
GAUTENG HIGH COURT, JOHANNESBURG
Appeal
No. A3071/209
Case
No.: 13800/2000
Date
of Appeal: 24 May 2010
DATE:8
June 2010
In
the matter of:-
ABSA
BANK LIMITED
...............................................
Appellant
versus
MS
T VAN RIE t/a AMAZING
YEARS
PRODUCTIONS
...........................................
First
Respondent
MS
P
YOUNG
.............................................................
Second
Respondent
JUDGMENT
A
J Bester, AJ:
[1]
The Appellant instituted an action against the First Respondent in
the court below on 29 November 2000. The Appellant claimed
payment of
the sum of R139,526.83 owing in respect of monies lent and advanced
on an overdraft cheque account. The action against
the Second
Respondent is based upon an agreement in terms of which she bound
herself, jointly and severally, as a co-principal
debtor together
with the First Respondent for due payment by the First Respondent of
all monies owing from time to time by the
latter to the Appellant.
[2]
Some six months after the launch of the action, the Respondents
requested further particulars, which were furnished in June
2001. In
January 2004, the Respondents served their plea and a counterclaim
and the Appellant's reply to the plea and its plea
to the
counterclaim were filed in July 2004. Between October 2003 and May
2007, no less than 8 notices of intention to amend were
issued by the
Appellant, but none were effected. The record of appeal is not
complete because these notices were omitted. Nevertheless,
the
Respondents did not object to the record.
[3]
The action was supposed to be heard by the court below on 14 May
2009. That was however not to be, as on the morning of the
hearing
day, the Respondents gave notice that they would raise five points in
limine. In brief, these points included the following:-
3.1.
the Appellant's claim exceeded the monetary jurisdiction of the court
below;
3.2.
whereas the Appellant relied upon a written agreement as against the
First Respondent, the copy of the agreement attached to
the
Appellant's further particulars was unsigned;
3.3.
the Appellant's particulars of claim, as read with its further
particulars, is excipiable.
[4]
The Appellant objected to the belated raising of these points and
contended that they ought properly to have been raised by
way of a
special plea. The magistrate rejected the Appellant's objection and
ruled that, as the points comprised issues of law,
they were capable
of being raised and heard at the hearing in terms of Rule 29(6) of
the Magistrates Court Rules.
[5]
The Appellant thereupon, in terms of
section 111
of the
Magistrates'
Courts Act, 32 of 1944
, sought various amendments which it contended
would dispose of the points in limine and enable the hearing of the
action to proceed.
These amendments were intended primarily to
introduce an averment to the effect that the agreement upon which the
Appellant's claim
against the First Respondent was based, was
written; alternatively oral (but incorporating the terms of the
written, but unsigned
agreement relied upon); or, further
alternatively, tacit.
[6]
The magistrate dismissed the amendment application and held as
follows:-
"
(Section
111)
... confers a discretion upon the presiding officer whether to
grant or declining an application to amend the pleadings. The test
to
be applied is whether such an amendment will prejudice the other
party against whom an amendment is sought. In the matter at
hand, the
summons was issued in November 2000 and the Plaintiff brought
numerous applications in terms of
Rule 55
to amend its particulars
which were not successful. The matter was enrolled eleven times
according to the court file. Adv. Friedman
argued that the court
should not grant the application as it will prejudice the Defendant
as the latter has been in and out of
court for the past nine years.
Adv. Van Berg did not argue the contrary. He did not convince the
court that the Defendant will
not be prejudiced. Furthermore, the
Plaintiff did not explain the delay and also failed to show that his
application is bona fide.
Thus the application in terms of
section
111
is dismissed."
[7]
In finding thus, the magistrate misdirected herself; for in a
section
111
amendment application, generally moved whilst a hearing is
already underway, but before judgment is handed down, the focus is on
prejudice "in the conduct of... (an) action or defence".
[8]
Before this court, the Appellant's counsel contended that the
magistrate had therefore erred in focussing on the potential
prejudice to the Respondents, brought about by the long delay between
the launch of the action and the hearing date on 14 May 2009.
Counsel
also argued that, in any event, there was nothing upon the basis of
which the magistrate could have found that Appellant
was mala fide in
moving the amendment. After all, the amendment was precipitated by
the points raised in limine and in respect
of which notice was only
given on the morning of the hearing.
[9]
The Appellant is in my view correct. The manner in which
section 111
applications should be approached by a court, in the exercise of the
discretion conferred upon it, was clearly expressed in
Trans-Drakensberg
Bank Ltd. v Combined Engineering (Pty.) Ltd. and
Another
1967 (3) SA 632
(D) (albeit in relation to the corresponding
provisions of the Rules of the then Supreme Court):-
"The
primary principle appears to be that an amendment will be allowed in
order to obtain a proper ventilation of the dispute
between the
parties, to determine the real issues between them, so that justice
may be done. Overall, however, is the vital consideration
that no
amendment will be allowed in circumstances which will cause the other
party such prejudice as cannot be cured by an order
for costs and,
where appropriate, a postponement." (at page 638)
"Having
already made his case in his pleading, if he wishes to change or add
to this, he must explain the reason and show prima
facie that he has
something deserving of consideration, a triable issue; he cannot be
allowed to harass his opponent by an amendment
which has no
foundation. He cannot place on the record an issue for which he has
no supporting evidence, where evidence is required,
or, save perhaps
in exceptional circumstances, introduce an amendment which would make
the pleading excipiable (Cross v Ferreira,
supra at p. 450), or
deliberately refrain until a late stage from bringing forward his
amendment with the purpose of catching his
opponent unawares... or of
obtaining a tactical advantage or of avoiding a special order as to
costs..." (at page 641)
[10]
In Viljoen v Baijnath
1974 (2) SA 52
(N), at 53, the court held that
the test applied in Trans-Drakensberg also applies in the
Magistrates' Court.
[11]
Clearly, a court hearing an application in terms of
section 111
has a
discretion whether or not to grant it, but that discretion must be
exercised judicially. From a perusal of the magistrate's
reasons, she
appears to have considered that the mere alleged past delay in the
hearing of the action was sufficient a ground for
a refusal of the
amendment sought by the Appellant. Of course, it needs to be stressed
that the Appellant had simply moved an amendment;
it did not also ask
for a postponement of the action. Presumably, had the amendment been
granted, the Respondents might have been
compelled to move an
amendment. Of course, as apparently correctly conceded on behalf of
the Appellant in the court below, the
past delay did prejudice the
Respondents. But should the prejudice occasioned to the Appellant by
the past delay and the belated
raising of the points in limine (which
precipitated the amendment application) simply be ignored in this
weighing up exercise?
There is no indication in the magistrate's
reasons that the prejudice occasioned to the Appellant and, in
particular, the prejudice
that would be occasioned by the refusal of
the amendment, was even considered. It is also nowhere evident from
the record that
the past delay was attributable exclusively to
conduct on the part of the Appellant. It is also evident from the
amendments sought
that they were by no means frivolous, intended to
delay the action or to achieve some or other tactical advantage.
Therefore, when
the magistrate concluded (by implication) that the
Appellant was at fault and that the amendments sought were not bona
fide, she
failed to exercise her discretion judicially and therefore
erred; interference in her judgement and orders is accordingly
permissible.
[12]
In the fall-back, counsel for the Respondents argued on appeal that
the Appellant had also unduly delayed the application for
the
amendment as, despite the fact that the objections raised in limine
were not especially pleaded, the Appellant had always been
aware that
the objection would be taken and that it ought therefore to have
moved the amendments sooner. But that submission begs
the question as
to whether a litigant should generally anticipate that some objection
or other would be taken even if it had not
been formally pleaded.
Assuming, however, that the Appellant ought to have anticipated that
those objections would be raised at
the hearing and that there was
therefore a delay in the moving of a timeous amendment to counter
them, the dictum in Trans-Drakensberg,
at page 642, is, in this
regard, instructive:-
"In
my judgment, if a litigant has delayed in bringing forward his
amendment, this in itself, there being no prejudice to his
opponent
not remediable in the manner I have indicated, is no ground for
refusing the amendment."
[13]
The remedy referred to by the court in Trans-Drakensberg is of course
an appropriate order for costs and, if dictated, a postponement.
It
is also apposite here, in the context of a possible oversight by the
Appellant by not having moved the amendment at an earlier
date or by
not pleading more accurately, to refer to Whittaker v Roos and
Another
1911 T.P.D. 1092
, at 1102, where the court held as follows:-
"This
Court has the greatest latitude in granting amendments, and it is
very necessary that it should have. The object of the
Court is to do
justice between the parties. It is not a game we are playing, in
which, if some mistake is made, the forfeit is
claimed. We are here
for the purpose of seeing that we have a true account of what
actually took place, and we are not going to
give a decision upon
what we know to be wrong facts. It is presumed that when a defendant
pleads to a declaration he knows what
he is doing, and that, when
there is a certain allegation in the declaration, he knows that he
ought to deny it, and that, if he
does not do so, he is taken to
admit it. But we all know, at the same time, that mistakes are made
in pleadings, and it would be
a very grave injustice, if for a slip
of the pen, or error of judgment, or the misreading of a paragraph in
pleadings by counsel,
litigants were to be mulcted in heavy costs.
That would be a gross scandal. Therefore, the Court will not look to
technicalities,
but will see what the real position is between the
parties."
[14]
I mention here, that in the course of argument before the court below
and before this court, it was contended on behalf of
the Respondents
that in certain respects the amendment sought by the Appellant was
res judicata, for an application for those aspects
of the amendment
was heard and dismissed on 15 May 2008. However, the court below was
apparently faced with a dilemma because,
despite reference to the
court file, there was nothing on record that tended to support that
argument. The magistrate therefore,
correctly in my view, ignored the
submission. That argument was nevertheless repeated in this court,
but we have the same difficulty.
The alleged application and its
contents, its alleged dismissal and the reasons for that dismissal
are not incorporated in, or
apparent from the record of appeal. It is
thus not possible to determine that issue. As pointed out above, the
Respondents did
not object to the record of appeal or attempt to
reconstruct a compete record and we are therefore constrained by what
we have
before us.
[15]
Counsel for the Respondents also argued that the amendment of the
Appellant's pleading to aver, in the alternative, that the
agreement
upon which the Appellant's claim against the First Respondent was
based, was oral or tacit, constitutes an impermissible
withdrawal of
an admission. The admission, so the argument goes, was the allegation
in the Appellant's further particulars that
the agreement was
written. Counsel's argument, however, loses sight of the fact that an
allegation of fact in a pleading is not
an admission of that fact; it
is a mere allegation and it can readily be withdrawn or amended, see:
Wild Sea Construction (Pty)
Ltd v Van Vuuren 1983(2) SA 450 C at 452
G-H. In any event, that allegation was denied by the Respondents in
their plea; if the
Respondents had admitted it, the position might
have been different: see Levy v Levy
[1991] ZASCA 81
;
1991 (3) SA 614
A at 622A-G.
[16]
I consider, therefore, that the magistrate ought to have granted the
amendment sought by the Appellant. That finding effectively
disposes
of the appeal in favour of the Appellant for, if the amendment ought
to have been granted, it is axiomatic that the order
by the court
below dismissing the action with costs, cannot be sustained. But I
would go further and hold that, even when making
the latter order,
the magistrate had erred. Having dismissed the application to amend,
the magistrate found that, as the written
document attached to the
Appellant's further particulars comprised an unsigned credit
application, "there is no contract between
the parties".
However, a document, on the face of it not signed by one of the
contracting parties, but nevertheless attached
to a pleading and
alleged to be a copy of an agreement concluded between them, can
never on its own warrant a conclusion that there
was in fact "no
contract'; at best, the allegation renders the pleading excipiable. A
consequence of a finding of such excipiability
is that a party would
generally be afforded an opportunity by the court to amend that
pleading so as to remedy it, for example
by attaching a duly signed
document or by amending the pleading so as to allege instead an oral
agreement on the same terms. Of
course, whatever prejudice is caused
by that amendment, such as wasted costs and even a postponement, will
in most circumstances
be cured by an appropriate order for costs. It
is only in very exceptional circumstances that a court would dismiss
the action
and, in this case, there are no such circumstances.
[17]
As an aside, it occurs to me that faced by an action that, well
before the hearing date on 14 May 2009, had clearly spiralled
out of
control, decisive intervention and case management was required by
the court below in order to restore an orderly and cost-effective
progression of the dispute to a final resolution. The obvious answer
to that situation was for the magistrate, suo motu, to adjourn
the
action and to conduct an in-chambers
section 54(1)
pre-trial
procedure. In the course of that procedure the issues between the
parties should have been delineated and simplified,
the necessity or
desirability of amendments to the pleadings should have been
considered and agreed and, in particular, measures
should have been
considered to restore order in, and to dispose of the action in the
most expeditious and least costly manner.
The ultimate purpose of
magistrate's court proceedings is, as I have always understood them,
to provide litigants with a simplified
and less costly means by which
to achieve a relatively speedy resolution of minor disputes. It is
lamentable that, in an action
in which the pleadings were less than
perfect and where, as late as nine years after its launch,
substantial objections were still
being raised on pleadings, the
magistrate passively permitted a continuation of that sad state of
affairs. Of course, the parties
could themselves have convened and
conducted a
section 54(1)
pre-trial conference, but they did not,
which seems to show that both sides were delinquent and had failed to
pursue an orderly
resolution of the dispute. Perhaps the time has now
come for the Magistrates' Courts to be more pro-active in moving
cases towards
resolution and, for example, to refuse to enrol actions
for hearing, as is the case in the High Court, if a proper pre-trial
conference
has not been held.
[18]
In the premises, I make the following order:-
18.1.
the appeal is upheld;
18.2.
the dismissal of the Appellant's application for an amendment in
terms of section 111 of the Magistrates' Court Act, and
the dismissal
of the Appellant's action with costs, are set aside and substituted
with the following orders:-
18.2.1.
"The amendments sought by the Appellant as set out in paragraphs
2.2.1, 2.2.2, 2.2.3, 2.2.4, 2.2.5, 2.2.6, 2.2.7, 2.3
and 2.4 of the
Appellant's Notice of Appeal dated 11 June 2009, are allowed';
18.2.2.
"the action is postponed sine die".
18.3.
the cost of the appeal is ordered costs in the action in the court
below.
Bester,
AJ
Acting
Judge of the High Court
8
June 2010
I
concur.
Tsoka,
J
Judge
of the High Court
8
June 2010