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[2020] ZAGPJHC 431
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Firstrand Bank Limited t/a CNH Capital v Jawiklane (Pty) Ltd (46192/2018) [2020] ZAGPJHC 431 (9 September 2020)
SAFLII
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Certain
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REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO:
46192/2018
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED.
09/09/2020
In
the
matter between:
FIRSTRAND
BANK LIMITED
T/A CNH CAPITAL
A
DIVISION OF
WESTBANK
Applicant
and
JAWIKLANE
(PTY) LIMITED
Respondent
JUDGMENT
Lapan
AJ:
INTRODUCTION
[1]
This is an application for an interim interdict for the return of a
vehicle to the
applicant, for safekeeping,
pendente Iite.
[2]
The applicant instituted an action against
the respondent for
inter alia
cancellation of the instalment sale agreement concluded between the
parties and for the return of the vehicle sold to the respondent,
the
applicant alleging that it retained ownership of the vehicle in terms
of the agreement.
[3]
Before considering whether the applicant
has met the requirements for the granting of an interim interdict,
and the respondent's
opposition thereto, the relevant background is
set out below.
BACKGROUND
[4]
On 26 June 2014, the applicant and the
respondent concluded an instalment sale agreement in terms of which
the applicant sold a
vehicle to the respondent (agreement). The
vehicle is described in the agreement as a 2014 new case IH Farmall
cab loader tractor
(vehicle).
[5]
In terms of the agreement, the applicant
retained ownership of the vehicle until the respondent had complied
with all of its obligations
in terms of the agreement.
[6]
The respondent is alleged to have breached
its obligations by falling into arrears with the payments due in
terms of the agreement.
[7]
In December 2018, the applicant issued
summons against the respondent, claiming cancellation of the
agreement, rectification of
the description of the vehicle and
repossession of the vehicle (action). On 11 January 2019, the
combined summons was served on
the respondent.
[8]
The particulars of claim, with annexures,
are attached to the founding affidavit marked “
FA3”.
A copy of the agreement is Annexure B of the particulars of claim and
a copy of a pre-agreement statement is Annexure D of the
particulars
of claim.
[9]
In December 2019, the applicant brought
this application for the return of the vehicle, for safekeeping,
pending the outcome of
the action.
REQUIREMENTS
FOR AN INTERIM INTERDICT
[10]
It is settled law that the applicant for an
interim interdict is required to establish the following:
(a)
a
prima facie
right though open to some doubt;
(b)
a well-grounded apprehension of irreparable
harm occurring should the interdict not be granted;
(c)
the balance of convenience favours the
granting of the interdict; and
(d)
the applicant has no other satisfactory
remedy available to it.
Prima
facie right
[11]
The applicant alleges that it has a
prima
facie
right to the return of the
vehicle, having retained ownership thereof in terms of the agreement
and based on its cancellation of
the agreement in terms of the
particulars of claim.
[12]
The respondent contends that:
[12.1]
the applicant has failed to establish its right to
the return of the
vehicle, relying as it
does on clause 4 of the agreement. The document relied on, being
annexure B of the particulars of claim,
is a pre-agreement statement
that was superceded by the agreement;
[12.2]
the cancellation of the agreement is disputed in the action
which
precludes determination of this application until the final outcome
of the action; and
[12.3]
the chassis number of the vehicle is incorrectly described
in the
agreement and the prayer, in the action, for rectification of the
agreement to correct the chassis number requires determination
before
this application can be decided.
Ownership
of the vehicle
[13]
The respondent contends that the
application ought to be dismissed since the applicant's reliance on
clause 4 of the agreement is
misplaced, first, because the agreement
(that is, annexure "B" of the particulars of claim) does
not contain a clause
4, and, second, to the extent that clause 4 in
the pre-agreement statement is relied upon (that is, annexure "D"
of the
particulars of claim), the pre-agreement statement was
superceded and replaced by the agreement.
[14]
The applicant relies on clause 4 of the
agreement, being Annexure B, which provides that the applicant will
remain the owner and
titleholder of the vehicle until all amounts due
by the respondent have been paid in full.
[15]
The document which is attached as Annexure
B of the particulars of claim is
headed
"COST
OF CREDIT SCHEDULE INSTALMENT SALE AGREEMENT
(outside the NCA)".
Below this heading, it is stated that the
agreement is concluded between the applicant, as the seller, and the
respondent, as the
buyer, with the parties' full particulars inserted
below their names.
[16]
Thereafter, Annexure B contains the
following provision:
"The
seller sells the goods described below to you, the Buyer, on the
terms and conditions set out in this Schedule and the
terms and
conditions annexed hereto and forming part hereof."
[17]
Based on the heading and the above-quoted
paragraph, the document attached as Annexure B must be the "schedule"
referred
to in the above paragraph
and
the "terms and conditions annexed hereto and forming part
hereof'
must be a
reference to the next document, attached as
Annexure D, which contains terms and conditions typically found in an
instalment sale
agreement. This is borne out by the provisions of
Annexure D.
[18]
The document marked Annexure D is headed
"RE-AGREEMENT
STATEMENT FOR A (sic) INSTALMENT SALE
AGREEMENT OUTSIDE THE
NCA"
Due to its illegibility, it is not clear whether the heading begins
with the word "Pre-agreement" or "Re-agreement".
For purposes hereof, the appellation used by the parties will be
accepted, namely,
"Pre-agreement
statement'.
[19]
Below the aforesaid heading is a paragraph,
encased in a block and preceded with the word
"WARNING".
The relevance of this paragraph is that it provides that
the
agreement is
...
"made
up of the quotation, the information statement, the pre-agreement
statement and these terms and conditions (which are
identical to the
pre-agreement statement)"
[underlining
added].
[20]
The underlined words appear to be a
reference to the terms and conditions appearing below the encased
paragraph and which is preceded
by a heading that reads
"TERMS
AND CONDITIONS FOR THIS INSTALMENT SALE AGREEMENT",
followed by the terms and conditions of an instalment sale agreement.
[21]
Based on the aforesaid heading, and the
ensuing terms and conditions, it appears that the terms and
conditions of the agreement
concluded between the parties is
contained in the document marked Annexure D. Even if this were not
so, the above paragraph encased
in the block at the top of Annexure D
makes it clear that the terms and conditions in Annexure 0
"are
identical to the pre-agreement
statement".
Therefore,
whether the document marked Annexure D is the agreement or the
pre-agreement statement, it contains the terms and conditions
of the
agreement concluded between the parties.
[22]
Clause 1 of the agreement contains the
following definition:
"the/this
agreement'
means
"this
instalment sale agreement which
comprised (sic) of these terms and
conditions and the Schedule attached"
[underlining
added]
[23]
The above definition bolsters the
conclusion that the terms and conditions of the instalment sale
agreement are contained in annexure
"D" and the Schedule
attached thereto. The reference to the schedule must be the schedule
which is Annexure B and which
sets out the parties' particulars, a
description of the vehicle, the purchase price, the instalments
payable and the applicable
interest rate. Various provisions of the
agreement in Annexure D refer back to the schedule and the items
listed therein.
[24]
Having regard to the above, the terms and
conditions in Annexure D must be read together with the schedule,
being Annexure B, both
of which comprise the agreement concluded
between the parties.
[25]
In view thereof, the applicant has
correctly relied on clause 4 of Annexure D for its reservation of
ownership. In addition, the
respondent admits, in the answering
affidavit, that the applicant retained ownership of the vehicle.
Cancellation
of the agreement
[26]
As
a prerequisite to the granting of an interim interdict for the return
of a vehicle owned by the applicant, the applicant must
establish
that it cancelled the agreement and that the cancellation was
communicated to the respondent.
[1]
[27]
The applicant cancelled the agreement, in
terms of the particulars of claim, which cancellation was
communicated to the respondent
upon service of the combined summons.
In the particulars of claim, the applicant alleges that the
cancellation was due to the respondent's
breach in failing to
maintain the payments due in terms of the agreement which, as at 30
November 2018, amounted to R181 886.04.
[28]
Clause
11
of the agreement gives the applicant the right, upon breach, to
cancel the agreement, take back the vehicle, sell the vehicle,
retain
all instalments made and claim the balance owing, if any, as damages.
[29]
The
fact that the cancellation of the agreement is disputed in the action
does not bar the applicant from seeking an interim interdict
since
the interim order is aimed at safeguarding the vehicle until
finalisation of the parties' dispute. The purpose of the attachment
order is not to enforce nor determine the rights of the parties under
the agreement.
[2]
[30]
Therefore, the dispute concerning the
cancellation of the agreement does not preclude the granting of an
interim interdict pending
the outcome of the action, provided that
all the requirements for an interim interdict are satisfied.
Error
in the description of the vehicle
[31]
The respondent contends further that there
is an error in the vehicle description in the agreement which
precludes the granting
of an interdict until the agreement is
rectified pursuant to the action.
[32]
The error consists of one letter in the
middle of the 17-digit chassis number which was erroneously recorded
as the letter "E"
instead of the letter "F". In
every other respect, the description of the vehicle in the agreement
is not disputed including
the name and type of vehicle, its model
number, engine number and serial number as well as the remaining
digits of the chassis
number.
[33]
The respondent does not contend that the
error in the chassis number means that a totally different vehicle
was sold and delivered
to the respondent upon conclusion of the
agreement and, to date, the respondent has used, and retained
possession, of the vehicle
delivered to it pursuant to the conclusion
of the agreement.
[34]
In fact, the vehicle description, and the
correct chassis number, is reflected in the respondent's contract of
insurance relating
to the vehicle, a copy of which is attached to the
answering affidavit. Furthermore, the applicant amended the notice of
motion
recently, without objection from the respondent, to reflect
the correct chassis number in the description of the vehicle in
prayer
1 of the relief sought.
[35]
In the circumstances, the misdescription of
the chassis number is inconsequential. Substance must prevail over
form and the vehicle
is sufficiently well described to permit its
identification. It would be unfair to penalise the applicant by
denying it a remedy
in terms of the agreement due to a minor
typographical error occurring in the agreement.
[36]
For the above reasons, the applicant has
established a
prima fade
right to an
interim interdict for the return of the vehicle.
Well-grounded
apprehension of irreparable harm
[37]
Since
the applicant's claim is vindicatory in nature, a rebuttable
presumption exists that irreparable harm will ensue if the vehicle
is
not returned
pendente
lite
.
[3]
[38]
The respondent contends that it requires
the vehicle to continue conducting a profitable farming business and
that the vehicle is
essential to the respondent's daily farming
operations. Returning the vehicle to the applicant will, so the
respondent contends,
jeopardise its farming operations until the
action is finalised.
[39]
The respondent contends further that the
vehicle is properly maintained,
stored
in a locked shed and comprehensively insured against loss or damage
and, therefore, there is no risk of harm befalling the
applicant if
the respondent continues utilising the vehicle in its daily farming
operations.
[40]
It
has been held that, whether or not the claim for the return of the
vehicle is vindicatory in nature, the applicant is entitled
to have
the vehicle kept in the condition in which it was in when instituting
the action and a refusal to grant interim relief
to ensure that it
remains in that condition, pending the outcome of the action, would
cause the applicant to suffer irreparable
harm.
[4]
[41]
The
interim interdict ensures that the applicant retains the vehicle in
its possession for safekeeping and allows the applicant
to preserve
the vehicle in the condition in which it was in at the time when it
sought to enforce its right to claim payment and
the return of the
vehicle.
[5]
If the vehicle is
not preserved in this way, the value of the vehicle will deteriorate
with continued use. The respondent does
not aver that such
deterioration in value is covered by the insurance contract.
[42]
The ensuing harm to the respondent's
farming operations, should the vehicle be returned to the applicant,
would be self-inflicted.
The respondent has been in arrears since 30
November 2018 and, despite having had the use of the vehicle for at
least the past
21 months to conduct its farming operations, the
respondent has made no effort to settle the arrears with a view to
negotiating
with the applicant for the possible reinstatement of the
agreement.
[43]
In view of the aforesaid, there is a
well-grounded apprehension of the applicant suffering irreparable
harm if it fails in its endeavour
to re-possess the vehicle for
safekeeping and to preserve its value
pendente
lite.
Balance
of convenience
[44]
The balance of convenience must favour the
granting of an interim interdict and this requirement is satisfied if
the prejudice that
the applicant will suffer, if the interdict is not
granted, outweighs the prejudice to the respondent if the interdict
is granted.
The stronger the applicant's prospects of success in the
action, the less the need for the balance of convenience to favour
the
applicant and
vice versa.
[45]
The respondent contends that the balance of
convenience favours it as it will suffer irreparable harm should it
be unable to continue
its farming operations until the action is
finalized and that there is no risk of harm to the applicant as the
risk of loss or
damage to the vehicle is covered in the insurance
contract.
[46]
The applicant is not protected against the
deterioration in the value of the vehicle as a result of its
continued use by the respondent.
The respondent is under no
obligation to preserve the vehicle nor does it intend to do so
because of its stated intention to continue
conducting its farming
operations.
[47]
The longer the vehicle remains in use, the
less the applicant's chances of recovering a high value for the
vehicle sufficient to
recoup the debt owed to it by the respondent.
Permitting the applicant to take possession of the vehicle will allow
it to store
the vehicle and preserve its resale value. Thus, the
balance of convenience favours the granting of the interdict.
[48]
Furthermore, the applicant has good
prospects of success in the action, given that the respondent's
defence consists mainly of bald
denials and its challenge to the
cancellation of the agreement is based on an alleged non-compliance
with section 129 of the National
Credit Act, 34 of 2005 (NCA). Yet,
the agreement states clearly that it fails outside the ambit of the
NCA.
[49]
The strong prospects of success in the
action, and given that the balance of convenience favours the
applicant, the third requirement
for the granting of an interim
interdict is satisfied.
No
alternative satisfactory remedy
[50]
There is no other remedy available to the
applicant other than to take possession of the vehicle and assume
full responsibility
for preserving it pending the outcome of the
action. An interim interdict will provide effective interim
protection for the applicant
until finalisation of the action.
[51]
Since
the application is vindicatory in nature, there is no need for the
applicant to show that it has no other satisfactory remedy.
[6]
[52]
In view of the aforesaid, the application
succeeds with costs, on the attorney and client scale as provided for
in the agreement.
[53]
The following order is made:
1.
The respondent is directed to return to the
applicant, within 10 (ten) days from the date of this order, the
vehicle more fully
described as:
1 x 2014 new case IH
Farmall 100 cab loader tractor
Chassis
no.:AE9JXI00FAECY1015
Engine No.: [....]
Serial
No.:
HFJ120557
2
The respondent is directed to pay costs of
this application on the attorney and client scale.
AJ
LAPAN
ACTING
JUDGE OF THE
COURT
GAUTENG
LOCAL DIVISION, JOHANNESBURG
COUNSEL
FOR THE APPLICANT:
Mr P Marx
APPLICANT'S
ATTORNEYS:
Rossouws, Lesie incorporated
COUNSEL
FOR THE RESPONDENT:
Mr WF Wannenburg
RESPONDENTS
ATTORNEYS:
De Kierk Vermaak & Partners
DATE
OF THE HEARING:
24 August 2020
DATE
OF JUDGMENT:
9 September 2020
[1]
SA
Taxi Securitisation (Pty) Ltd v Chesane
2010
(6) SA 557
(GSJ) in para [13].
[2]
Ibid
i
n
para [10].
[3]
Stern
and Ruskin No v Appelson
1951
(3) SA 800
(W) at 813
.
[4]
Per
Justice Greenberg in
Morrison
v African Guarantee and Indemnity Co Ltd
(1936) (1) PH Sec. M as quoted by Millin J in
Loader
v De Beer
1947 (1) SA 87
(W) at 90.
[5]
SA
Taxi Securitisation
2010 (6) SA 557
(GSJ) in para [10];
Loader
v De Beer
1947 (1) SA 87
(W) at 89D et seq.
[6]
Fedsure
Life Assurance Co Ltd v Worldwide African Investment Holdinqs (Ptv)
Ltd and Others
2003
(3)
SA 268
(W) in para [28].