About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Supreme Court of Appeal
SAFLII
>>
Databases
>>
South Africa: Supreme Court of Appeal
>>
2014
>>
[2014] ZASCA 34
|
|
ABSA Bank Limited v Van Rensburg and Another; In Re: ABSA Bank Limited v Maree and Another (228/2013) [2014] ZASCA 34; 2014 (4) SA 626 (SCA) (28 March 2014)
Links to summary
THE SUPREME
COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case
no: 228/2013
DATE:
28 MARCH 2014
Reportable
In
the matter between:
ABSA
BANK
LIMITED
.....................................................................................
APPELLANT
And
PETER
JACOBUS JANSE VAN RENSBURG
.................................
FIRST
RESPONDENT
GINA
MARI JANSE VAN RENSBURG
.....................................
SECOND
RESPONDENT
And
ABSA
BANK
LIMITED
....................................................................................
APPELLANT
And
ELIZABETH
FRANCINA MAREE
.................................................
FIRST
RESPONDENT
STEFANUS
MAREE
....................................................................
SECOND
RESPONDENT
Neutral
citation:
Absa
Bank Ltd v Van Rensburg
(228/13)
[2014] ZASCA 34
(28 March 2014)
Coram:
Maya,
Shongwe, Leach, Saldulker JJA and Mathopo AJA
Heard:
10
March 2014
Delivered
:
28 March 2014
Summary
:
Appeal – s 21A of the Supreme
Court Act 59 of 1959 – a
court of appeal will not entertain an appeal where the disputes
between the parties have been settled
and the order sought will have
no practical effect or result – Appealability – an order
postponing an application for
default judgment to afford the
plaintiff an opportunity to annex underlying documents to its simple
summons is not appealable.
ORDER
On
appeal from
:
Western Cape High Court, Cape Town (Griesel J, Fourie and Saldanha JJ
concurring) sitting as court of appeal.
The
appeal is struck from the roll.
JUDGMENT
Maya
JA:
(Shongwe,
Saldulker JJA and Mathopo AJA concurring)
[1]
This is an unopposed appeal against a postponement order of the full
court of the Western Cape High
Court, Cape Town (Griesel J, Fourie
and Saldanha JJ concurring), with its leave. The appeal was heard and
struck off the roll on
10 March 2014 and the court undertook that its
reasons would follow. These are the reasons.
[2]
The background facts are simple. The appellant (Absa) launched action
proceedings against the respondents
in the high court based on
mortgage bonds registered in its favour over immovable properties
belonging to the respondents. The
respective claims were commenced by
way of simple summonses to which were annexed copies of the relevant
mortgage bonds and the
deeds of suretyship signed by the spouses of
the respective owners. In due course, the claims were set down for
hearing as unopposed
applications for default judgment. In those
proceedings, a question arose whether or not it was necessary to
attach to the simple
summonses the underlying credit agreements
secured by the bonds and suretyships as had been required in some
cases of that division.
[3]
In light of divergent views on the question in the division, the
matters were referred for hearing by
the full court to obtain clarity
as to the correct procedure to be followed. Absa denied the need to
annex the underlying agreements
to the summonses. It relied for its
stance mainly on the absence of such a requirement in the Uniform
Rules of Court (the rules)
and the Consolidated Practice Note of the
Western Cape High Court. It contended that the establishment of such
a practice by the
full court would effectively usurp the powers of
the Rules Board which is constituted to make relevant prescriptions
in the rules
and specify the requirements applicable to a simple
summons. And, in defended matters, the practice would necessitate the
attachment
of voluminous documentation both to simple summonses and
the subsequent declarations. This would result in unnecessary
duplication
and expense, it was argued.
[4]
The full court considered various authorities on
the issue including judgments of its division and relevant
practice
in other large divisions. It came to the conclusion that the weight
of authority favoured a view, which it adopted,
that ‘although
a simple summons is not a pleading, it is nevertheless necessary, on
a proper interpretation of [Uniform]
rule 17(2)(b), read with Form 9,
to attach a written agreement where the plaintiff’s cause of
action is based on such agreement’.
To this finding the full
court added two riders – that (a) it would not be compulsory
for a plaintiff seeking a default or
summary judgment to file the
original agreement unless so directed by the court and (b) a
plaintiff who relied on portion only
of a voluminous written
agreement could attach only such portion to the summons. The court
then postponed the matters
sine die
with no order as to costs.
The matters were postponed to afford Absa an opportunity to amend its
summonses so as to refer to the
underlying credit agreements and
annex them. It is the full court’s reason for the postponement
orders to which Absa objects.
[5]
However, subsequent to the lodging of the appeal, Absa settled the
two matters with the respective respondents.
But this
notwithstanding, it persisted with the appeal despite the resolution
of all disputes between the parties.
[1]
It contended that the question of law at issue (ie whether it is
necessary for a plaintiff who institutes action by way of an ordinary
summons to annex the written agreement upon which its cause of action
is based) is not confined to the parties
inter
se
as
the issue is likely to arise frequently. Thus, this court’s
judgment would still have a practical effect or result, so
it
claimed.
[6]
Two preliminary issues that may each decide the fate of the appeal
arise for determination. One is whether
this court should hear the
appeal at all in light of s 21A(1) of the Supreme Court Act 59 of
1959 (the Act).
[2]
The other is
whether the matter is, in any event, appealable having regard to the
nature of the orders appealed against.
[7]
According to s 21A(1), if the issues in an appeal ‘are of such
a nature that the judgment or order
sought will have no practical
effect or result, the appeal may be dismissed on this ground alone’.
These provisions set a
direct and positive test: whether the judgment
or order will have a practical effect or result and not whether it
might be of importance
in a hypothetical future case.
[3]
As a result, this court will not ‘make determinations on issues
that are otherwise moot merely because the parties believe
that,
although the decision or order will have no practical result between
them, a practical result could be achieved in other
respects’.
[4]
[8]
But the section confers a discretion on this court.
[5]
Thus, in
The
Merak S: Sea Melody Enterprises SA v Bulktrans
,
[6]
this court found that allowing the appeal would have no practical
effect but nonetheless decided the merits of appeal. The court
reasoned as follows:
‘
In
view of the importance of the questions of law which arise in this
matter, the frequency with which they arise and the fact that
at the
time of the decision in the Court
a
quo
and
of the granting of leave to appeal those questions were …
“live issues”, I am satisfied that this is an appropriate
matter for the exercise of this Court’s discretion to allow the
appeal to proceed:
Coin
Security Group (Pty) Ltd v SA National Union for Security Officers
and Others
[2000] ZASCA 137
;
2001
(2) SA 872
(SCA) at 875 (para [8]) and
Natal
Rugby Union v Gould
[1998] ZASCA 62
;
1999
(1) SA 432
(SCA)’.
In
Land
en Landbouontwikkelingsbank van Suid-Afrika v Conradie
,
[7]
this court once more decided the merits of an appeal – whether
the termination of the right of residence of an occupier was
just and
equitable within the meaning of the
s 8(1)
of the
Extension of
Security of Tenure Act 62 of 1997
– where the occupier had
vacated the property by the time the appeal was heard and had no
interest in its outcome, which
would have no practical effect for the
parties
inter
se
.
The court considered the question of law involved, which arose
frequently, important. It further took into account that the judgment
appealed against, which was found wrong, had already been followed in
a reported judgment.
So,
depending on the facts of each case, while the parties may have
resolved all their differences, a court of appeal may nevertheless
entertain the merits of the appeal if, for example, important
questions of law which are likely to arise frequently are at issue
and their determination may benefit others.
[8]
[9]
Elsewhere, utmost caution in exercising that discretion has been
advocated. In an English decision,
R
v Secretary of State for the Home Department, Ex Parte Salem
,
[9]
which has been considered by this court albeit without pronouncing a
final view on its dictum,
[10]
as here, the discretion to adjudicate an appeal, where there is no
longer a dispute between the parties, was strictly limited to
the
area of public law. And that court further circumscribed the
discretion as follows:
‘
the
discretion to hear disputes, even in the area of public law, must,
however, be exercised with caution and appeals which are
academic
between the parties should not be heard unless there is a good reason
in the public interest for doing so, as for example
(but only by way
of example) when a discrete point of statutory construction arises
which does not involve detailed consideration
of facts and where a
large number of similar cases exist or are anticipated so that the
issue will most likely need to be resolved
in the near future.’
[11]
[10]
Notably, the decisions in which our courts exercised their discretion
in the appellants’ favour and considered
the merits of the
appeals invariably concerned frequently arising questions of
statutory construction and application.
[12]
In
Sebola
v Standard Bank
,
[13]
upon which Absa relied, the Constitutional Court was requested to
interpret and assess the constitutional impact of a statutory
provision about which there had long been uncertainty which resulted
in many conflicting high court decisions. The court came to
the
decision that it was in the interests of justice to hear the appeal
on its merits.
[14]
In reaching
that decision, the court noted that the appellants’ costs
incurred in resisting the sale of their home, the subject
of the
dispute, which the bank did not tender, and the bank’s own
costs in the Constitutional Court which it threatened to
recover if
they persisted with the appeal, remained a live issue for them. But
the court reiterated that a dispute about costs
alone is insufficient
reason to hear an appeal whose issues have gone dead. What it
considered pivotal in the enquiry was the meaning
it would assign to
the statutory provisions, which would have a significant practical
impact.
[15]
And the court took
into account that the Supreme Court of Appeal, whose controversial
decision was appealed against, had not had
the benefit of the
wide-ranging submissions made to it on the constitutional impact of
the various interpretations contended for.
These factors vastly
distinguish the case from the present one
.
[11]
At stake here is the precise requirement of a rule of court
procedure. Bearing in mind that
s 21A
was aimed at reducing the heavy
workload of appellate courts,
[16]
it is very relevant that there is a statutory body specially created
to deal with all issues pertaining to matters of this nature,
as
pointed out by Absa itself. The Rules Board for Courts of Law Act 107
of 1985 (the Rules Board Act) is chiefly aimed at providing
‘for
the making of rules for the efficient, expeditious and uniform
administration of justice in the Supreme Court of Appeal,
High Courts
and lower courts’.
[17]
This object is achieved through the Rules Board for Courts of Law
(the Rules Board)
[18]
which is
empowered, inter alia, ‘from time to time on a regular basis
[to] review existing rules of court and subject to
the approval of
the Minister, make, amend or repeal rules … regulating the
practice and procedure in connection with litigation
… [and]
the form, contents and use of process’.
[19]
The present question falls squarely within this ambit and any
uncertainty relating to the relevant rule’s application should
rightly be resolved by the Rules Board.
[12]
Furthermore, this court has repeatedly cautioned against deciding a
matter without the benefit of tested argument
from both sides on
questions that are necessary for the decision of the case.
[20]
A decision on the merits of this appeal would be based on the
argument of only one of the parties. In these circumstances,
Absa has
established no reason for this court to exercise its discretion in
its favour and entertain the merits of the appeal.
[13]
Despite this finding, which effectively disposes of the appeal, it is
necessary to deal briefly with the other
fundamental hurdle faced by
Absa. Recently, in an analogous judgment in
Absa
Bank v Mkhize
,
[21]
this court had occasion to pronounce on the nature and effect of an
order postponing the hearing of an application for default
judgment
in order to give the plaintiff an opportunity to take further steps
to augment its case, as was done here. The majority
held that such an
order is merely a direction from the high court, before the main
action can be entered into, as to the manner
in which the matter is
to proceed; it does not amount to a refusal of default judgment nor
does it directly bear upon or dispose
of any of the issues in the
main action and is thus not a dismissal of the action.
[22]
Reiterating the trite fact that an appeal lies against the
substantive order made by the court and not the reasons for the
judgment,
[23]
the majority
concluded that the order was therefore not appealable. Needless to
say, this judgment binds us and the appeal must
fail on this ground
too.
[14]
For these reasons the appeal was struck from the roll.
MML
MAYA
JUDGE
OF APPEAL
Leach
JA:
[15]
My conclusion that the matter had to be struck from the roll was
reached by a somewhat different route from that
followed by my
learned colleague, Maya JA. She has concluded that the issues raised
upon appeal became moot when the parties settled
their litigation and
that the order of the court below was in any event not appealable. I
agree with the latter conclusion for
the detailed reasons she has
given. But, in my view, the effect of the settlement was not to
render the issues between the parties
moot; instead it brought an end
to the litigation, thereby removing the disputes that had existed
from the jurisdiction of the
court.
[16]
Had the claims been dismissed, that would have constituted a final
judgment that was appealable; but the order
granted was no more than
interlocutory in nature. Consequently, although the appellant may
have had reason to feel aggrieved, it
could not appeal against the
order of postponement for the reasons given by Maya JA. Moreover, the
court below erred in granting
leave to appeal to this court; and its
reason for doing so, namely, that the order was of final effect in
that ‘default judgment
on the papers as they stand had to be
refused’ is insupportable.
[17]
However, the appeal was overtaken by events when the parties settled
the action. In my view, that was the end of
the matter and, in truth,
the issue whether leave to appeal ought or ought not to have been
granted in itself became moot.
[18]
In reaching that conclusion, I found the reasoning of this court in
Port
Elizabeth Municipality v Smit
2002 (4) SA 241
(SCA) to be most persuasive. In that matter the
appellant had been sued by the respondent for damages suffered as a
result of injuries
sustained by her when she fell into a manhole. The
respondent succeeded both in a magistrate’s court as well as on
appeal
to the high court. After leave to appeal further to this court
had been granted, the parties concluded a settlement agreement that
effectively resolved all their differences resulting in there being
no longer any dispute or
lis
between them. The preliminary question which then arose before this
court was whether the appeal should be entertained at all.
In regard
to that question and the provisions of s 21A(1) of the Supreme Court
Act 59 of 1959, Brand JA, in delivering the unanimous
judgment of
this court, stated the following:
[24]
‘
It
can be argued, I think, that s 21A is premised upon the existence of
an
issue
subsisting between the parties to the litigation which requires to be
decided. According to this argument s 21A would only afford
this
Court a discretion not to entertain an appeal when there is still a
subsisting
issue
or
lis
between the parties the resolution of which, for some or other
reason, has become academic or hypothetical. When there is no longer
any
issue
between
the parties, for instance because all issues that formerly existed
were resolved by agreement, there is no “appeal”
that
this Court has any discretion or power to deal with. This argument
appears to be supported by what Viscount Simon said in
Sun
Life Assurance Company of Canada v Jervis
[1944] AC 111
(HL) at 114, when he said, with reference to facts very
similar to those under present consideration:
“
.
. . I think it is an essential quality of an appeal fit to be
disposed of by this House that there should exist between the parties
a matter in actual controversy which the House undertakes to decide
as a living issue.”
Consequently,
he found that in a matter where there was no existing
lis
between the parties the appeal should be dismissed on that ground
alone (at 115). (See also
Ainsbury v Millington
[1987] WLR 379
(HL) at 381.) More recently, however, it was said by Lord Slynn of
Hadley in
R v Secretary of State for the Home Department, Ex parte
Salem
[1999] UKHL 8
;
[1999] 2 WLR 483
(HL) at 487H ([1999]
2 All ER 42
at 47
c
)
that:
“
.
. . I accept . . . that in a cause where there is an issue involving
a public authority as to a question of public law, your Lordships
have a discretion to hear the appeal, even if by the time the appeal
reaches the House there is no longer a
lis
to be decided which will directly affect the rights and obligations
of the parties
inter
se
.”
It
is true that Lord Slynn immediately proceeded to confine this
discretion to entertain an appeal, where there is no longer a
lis
between the parties, to the area of public law and added that the
decisions in the
Sun Life
case and
Ainsbury v
Millington
must accordingly be read as limited to disputes
concerning private law rights between the parties to the case (at
487H - 488A (WLR)
and 47
c
-
d
(All ER)).’
[19]
Although Brand JA went on to leave the point open – the court
decided to assume it could still exercise a
discretion to hear the
appeal and proceeded to dismiss it under
s
21A(1) – his reasoning set out above seems to me to be
unassailable, especially as in this case there is no issue involving
‘a public authority as to a question of public law’ but a
dispute as to procedure. Consequently, after the settlement,
there
was no ‘living issue’ between the parties and, in my
view, this court could no longer entertain any of the issues
that
arose before the settlement.
[20]
I am aware of certain decisions, three in particular, that may
arguably support a contrary conclusion. Closer examination
however
shows that not to be the case.
(a)
The
leading example is
Sebola
v Standard Bank
2012 (5) SA 142
(CC), but as Maya JA points out in that matter there
was in fact a live issue in respect of costs still in dispute between
the
parties. Nothing further needs be said about the decision in that
case.
(b)
In
Land
en Landbouontwikkelingsbank van Suid-Afrika v Conradie
2005 (4) SA 506
(SCA) the appellant appealed against a high court
order setting aside an order granted by a magistrate evicting the
respondent
from certain premises. The respondent vacated the property
before the appeal in this court was heard and to that extent allowing
the appeal would have no practical effect. This court, however,
declined to dismiss the appeal under s 21A(1), inter alia as the
questions of law it raised were of importance. In that case, too,
however, the matter had not been settled and there were still
live
issues between the parties, including the costs in the magistrates’
court (the respondent had been ordered to pay such
costs but that
order had been set aside by the high court) as well as the costs in
the appeal from the high court. This court was
therefore called on
under s 21(A)(1) to exercise a discretion it had to determine issues
that were still live and had not been
settled by the parties.
(c)
In
The
Merak
S:
Sea
Melody Enterprises SA v Bulktrans (Europe) Corporation
2002 (4) SA 273
(SCA) the appellant, whose application to a high
court for a reduction of a bank guarantee provided to procure a
ship’s release
from attachment had been dismissed, appealed
against that decision to this court. The ship had been attached to
provide security
for claims the respondent intended pursuing against
the appellant in arbitration proceedings in London. After the high
court had
granted leave to appeal, it appeared that the respondent
did not intend to proceed with the arbitration proceedings and the
appellant
obtained an order from another court that the guarantee it
had provided be returned to it. Despite this, and the fact that in
these
circumstances the appeal to this court against the refusal to
reduce the guarantee would have no practical effect, this court heard
the appeal and set aside the high court’s order. It did so as
at the time of the high court’s order and the granting
of leave
to appeal the issues were ‘live’ and the matter raised
important questions of law that frequently arise.
[25]
Not only was there no settlement between the parties of the dispute
that was the subject of the appeal but, as in both the cases
previously mentioned, the costs that had been incurred on appeal was
still a live issue at the hearing of the appeal. And although
the
costs in the court of first instance were not mentioned in the
judgment of this court, the appellant had been ordered to pay
them as
appears from the reported judgment of the court a quo
[26]
,
and that order was set aside by this court at the end of the day.
Thus in this case, too, the issue of costs was still live issues
between the parties when the matter came before this court.
[21]
In the present case there are no live issues between the parties
after the settlement. This distinguishes the matter
from all three of
the decisions I have mentioned, in each of which there had been no
settlement after leave to appeal had been
granted and in which there
were still live issues when the appeal came before this court. They
therefore throw no doubt upon the
reasoning of Brand JA in
Port
Elizabeth Municipality v Smit
to which I have referred, and I
have been unable to find any other authorities that do. Whilst I
accept that the views of Brand
JA on this issue were obiter, I see no
reason not to follow them. Indeed I did not understand counsel for
the appellant to dispute
that this court could not entertain the
appeal post settlement.
[22]
Accordingly, in my view, once the parties settled, the litigation
terminated and there were thereafter no disputes
between them upon
which this court could exercise its appellate jurisdiction. That
being so, there was no room for this court to
exercise its discretion
under s 21A(1) to dismiss the appeal as there was no appeal before it
to dismiss. All it could do was to
remove the matter from its roll.
[23]
In the light of what I have said, I am of the view that had the
parties not settled the action, this court would
probably have
refused to hear the appeal as the order of the court below was not
appealable. But in the light of their settlement
after leave to
appeal had been granted, the litigation between them came to an end
and there was thereafter nothing for the court
to adjudicate upon
(including, for that matter, any dispute as to whether the order was
appealable or not). It is simply for this
reason that, in my view,
the appeal had to be struck from the roll.
L
E Leach
Judge
of Appeal
APPEARANCES:
For
Appellant:
LM Olivier SC (with FSG Seivers)
Instructed
by:
Marais
Muller Yekiso Inc., Cape Town
Symington
De Kok, Bloemfontein
No
appearance for the respondents
[1]
It did
withdraw the
appeal partially in respect of the Van Rensburg matter but proceeded
against the order granted in the Maree application.
[2]
The Act has since been repealed
and replaced by the
Superior Courts Act 10 of 2013
which was
assented to on 12 August 2013, after the institution of these
proceedings. In terms of
s 52
of the latter Act, the Act applies to
appeals pending in any court at its commencement as if it had not
been passed. Thus, the
appeal must be decided under the provisions
of the Act.
[3]
Premier,
Provinsie Mpumalanga, en ‘n ander v Groblersdalse
Stadsraad
1998
(2) SA 1136
(SCA) at 1141E.
[4]
Land en
Landbouontwikkelingsbank van Suid-Afrika v Conradie
2005
(4) SA 506
(SCA) para 6. See also,
Radio
Pretoria v Chairman, Independent Communications Authority of South
Africa
2005
(1) SA 47
(SCA);
Coin
Security Group (Pty) Ltd v SA National Union for Security Officers
2001
(2) SA 872 (SCA).
[5]
Coin
Security Group (Pty) Ltd
above
para 8;
President,
Ordinary Court Martial, & others v Freedom of Expression
Institute & others
[1999] ZACC 10
;
1999 (4) SA 682
(CC) para 13;
Land
en Landbouontwikkelingsbank van Suid-Afrika
above,
para 7.
[6]
2002 (4) SA 273
(SCA) para 4.
[7]
Fn 4.
[8]
See
also
Rand
Water Board v Rotek Industries (Pty) Ltd
2003 (4) SA 58
(SCA) paras 18 to 21.
[9]
R
v Secretary of State for the Home Department, Ex Parte Salem
[1999] UKHL 8
;
[1999] 2 WLR 483
(HL) ([1999]
2
All ER 42
(HL)).
[10]
In
Port
Elizabeth Municipality v Smit
2002
(4) SA 241
(SCA)
at
247E-I.
[11]
Above n7,
a
t
487 and 47c, respectively.
[12]
In
The
Merak S Sea Melody Enterprises SA v Bulktrans (Europe) Corporation
2002
(4) SA 273
(SCA),
the
issue considered important and arising frequently by the court was
whether a bank guarantee given to secure the release of
an arrested
vessel constituted ‘security’ for purposes of s
5(2) of the Admiralty Jurisdiction Regulation Act
105 of 1983.
Land
en Landbouontwikkelingsbank van Suid-Afrika v Conradie
concerned the interpretation and application of
s 8(1)
of the
Extension of Security of Tenure Act 62 of 1997
, as indicated.
[13]
Sebola v Standard Bank of
South Africa
2012 (5)
SA 142 (CC).
[14]
The
provisions of the Act, including s
21A,
did not apply to the
Constitutional
Court which uses a different yardstick, the interests of justice
test, in deciding whether to hear an appeal whose
issues have gone
dead.
[15]
See also
MEC
for Education, KwaZulu-Natal & others v Pillay
[2007] ZACC 21
;
2008
(1) SA 474
(CC) paras 32 to 35;
National
Coalition for Gay and Lesbian Equality & others v Minister of
Home Affairs & others
2000
(2) SA 1
(CC) at fn 18;
JT
Publishing (Pty) Ltd v & another v Minister of Safety and
Security & others
[1996] ZACC 23
;
1997
(3) SA 514
(CC) para 15.
[16]
Premier, Provinsie
Mpumalanga, en ‘n ander v Groblersdalse Stadsraad
,
fn3 at 1141D.
[17]
As set out
in
its preamble.
[18]
Established under
s
2 of the
Rules Board Act.
[19]
Section
6(1)(
a
)
and (
b
)
of the Rules Board Act.
[20]
See, for example,
Western
Cape Education Department & another v George
1998
(3) SA 77
(SCA) at 84E;
Port
Elizabeth Municipality v Smit
2002 (4) SA 241
(SCA) para 11.
[21]
Absa Bank
v Mkhize
[2014]
All SA 1
(SCA)
.
[22]
P
aras
59, 62 and 63.
[23]
P
ara
64;
Western
Johannesburg Rent Board & another v Ursula Mansions (Pty) Ltd
1948
(3) SA 353
(A) at 355.
[24]
At para 7.
[25]
Para 4.
[26]
See
Sea Melody Enterprises SA v Bulktrans (Europe) Corporation
(
The
“Merak S”) [2000] 1 Lloyd’s Rep
619 [SA Ct].