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[2021] ZAGPJHC 4
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Main Street (Pty) Limited t/a Nashua Central v Mathopo (4028/2018) [2021] ZAGPJHC 4 (1 February 2021)
REPUBLIC OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, JOHANNESBURG
(1)
REPORTABLE: No
(2)
OF INTEREST TO OTHER JUDGES: No
Case No.: 4028/2018
In
the matter between:
MAIN
STREET 1052 (PTY) LIMITED t/a NASHUA CENTRAL
Plaintiff
and
GABRIEL TSHEPO
MATHOPO
Defendant
JUDGMENT
This
judgment was handed down electronically by circulation to the
parties’ legal representatives by email and is deemed to
be
handed down upon such circulation.
Gilbert AJ
1.
The plaintiff rented to the defendant certain
equipment in terms of a written rental agreement. There is a dispute
as to what to
what was included in that equipment but it is common
cause that the primary equipment was a photocopier.
2.
The plaintiff seeks summary judgment against the
defendant for payment of what it contends are outstanding arrear
rentals and for
pre estimated damages for the balance of the
60 month rental period.
3.
The summary judgment application was launched
before the amendment to Uniform Rule 32 came into effect.
4.
The defendant has raised various defences that he
wishes to pursue at trial and so seeks that leave to defend be
granted.
5.
One defence is that the plaintiff failed to
include in the equipment rented to the defendant an LCD monitor
and server in circumstances
where the plaintiff had fraudulently
represented to him that such equipment would be included in the
leased equipment. The description
of the goods rented under the
rental agreement as set out in the relevant schedule to the agreement
is described as the following
items:
5.1.
“
MPC3003/MPC2003 SB”
with serial number E204RA60162;
5.2.
“
Softlog 8 User”
with
serial number DMS0002117;
5.3.
“
iPad”
.
6.
The plaintiff in its particulars of claim
describes the equipment that it rented as “
MPC-3003/MPC-2003SP
with serial number E204RA60162 and Softlog for 8 users with serial
number DMS0002117”.
7.
It is common cause that the equipment would
include at least a photocopier. But what cannot be determined from
the description of
the goods in the schedule to the rental agreement,
or the plaintiff’s description of the equipment, is whether
those goods
as described included an LCD monitor and a server.
8.
In my view, there is at least a triable issue in
relation to what the parties agreed would be rented to the defendant
under the
rental Agreement, what was in fact rented under the rental
agreement and whether some or other fraudulent misrepresentation took
place in relation thereto.
9.
The defendant also raises various other defences
based upon the application of section 14 of the Consumer
Protection Act, 2008
(“CPA”). On the papers it is common
cause that the CPA applies. The rental agreement itself refers
extensively to the
CPA.
10.
The defendant relies upon section 14(2)(a)
of the CPA, which provides that the term of a fixed term consumer
agreement must
not exceed the maximum period, which in this case is
24 months. The present rental agreement is 60 months. Therefore, the
maximum
prescribed period has been exceeded. The defendant in his
opposing affidavit states that in terms of the applicable regulations
a fixed term agreement can only be concluded if it would be to the
financial advantage to the consumer and the supplier, in this
instance the plaintiff, demonstrates such an advantage to the
consumer. No case is made out in the particulars of claim by the
plaintiff as the supplier that it was to the financial advantage of
the defendant as the consumer to conclude a fixed term agreement
of
60 months. In the circumstances, this defence too raises a triable
issue.
11.
The defendant also contends that he cancelled the
rental agreement based upon his statutory right to do so before the
end of the
fixed term as provided for in section 14(2)(b)(i)(bb) of
the CPA. Section 14(3)(b) of the CPA provides that in the
instance
of such cancellation before the end of the fixed term the
supplier, in this instance the plaintiff, “
may
impose a reasonable cancellation penalty with respect to any goods
supplied, services provided, or discounts granted, to the
consumer in
contemplation of the agreement enduring for its intended fixed term,
if any.
” The defendant has in his
resisting affidavit referred to the regulations which set out various
factors to be taken into
account when determining a reasonable
cancellation penalty.
12.
There is a dispute as to whether the defendant
did in fact give notice of termination of the rental agreement. The
defendant only
attached the covering email that purported to attach
the termination letter but not the termination letter itself,
apparently because
of an oversight. Further, the plaintiff disputed
that in any event notice had been properly furnished to the
plaintiff, particularly
when regard is had to the terms of the rental
agreement.
13.
Although the defendant failed to attach the
actual termination letter itself, I am prepared to accept for the
purposes of these
summary judgment that the defendant, as he stated
under oath, did furnish a termination letter as the details furnished
in his
resisting affidavit demonstrates sufficient
bona
fides
on his part. (The resisting affidavit
is lengthy, consisting of 22 pages and 59 paragraphs, with
considerable detail). Further,
such arguments that would have to be
had as to what would constitute compliant notice in terms of section
14(2)(b)(i)(bb) of the
CPA or whether such notice is necessary at all
as a precursor to the plaintiff as supplier being bound to charge a
“reasonable
cancellation penalty” as provided for in
section 14(3) is best left for trial.
14.
It was no longer business as usual for a supplier
of goods in terms of a consumer agreement once the CPA came into
effect. It is
no longer open to a supplier of goods that falls under
the CPA to without more claim as pre-estimated liquidated damages the
sum
of all amounts payable under over the unexpired period of the
agreement. To do so, as the plaintiff has done in the present
instance,
may fall foul of section 14(3)(b), which provides for “a
reasonable cancellation penalty”.
15.
This raises the question whether the claiming of
such a reasonable cancellation penalty can be considered to be “
for
a liquidated amount in money
” and
therefore be capable of sustaining summary judgment in terms of
Uniform Rule 32. As this particular issue was not
squarely
raised on the papers or addressed in any detail before me, that
question can be left for another day.
16.
In my view, the defendant has satisfied the court
that he has
bona fide
defences that may be good in law to the claim and in the
circumstances, leave to defend is to be granted.
17.
Although the defendant sought that the plaintiff
pay the costs of the summary judgment application if dismissed, such
evidence as
would be adduced at trial will demonstrate whether the
defendant was
bona fide
in
his defences, including in asserting a fraudulent misrepresentation
on the part of the plaintiff.
18.
The following order is made:
18.1.
The application for summary judgment is dismissed
and the defendant is granted leave to defend.
18.2.
Costs are reserved for the trial court.
Gilbert AJ
Date of
hearing:
28 January 2021
Date of judgment:
1 February 2021
Counsel for the
Plaintiff :
Ms S van Aswegen
Instructed
by:
Swartz Weil Van der Merwe Greenberg Inc.
Counsel for the
Defendant:
Mr K Naidoo
Instructed
by:
Madlela Gwebu Mashamba Inc