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[2021] ZAGPJHC 376
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Invest in Property 48 (Pty) Ltd v Mazwe Financial Services (Pty) Ltd (20818/2019) [2021] ZAGPJHC 376 (3 June 2021)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, JOHANNESBURG)
Case
no: 20818/2019
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED.
3
June 202
In
the matter between:
INVEST
IN PROPERTY 48 (PTY)
LTD
Applicant
And
MAZWE
FINANCIAL SERVICES (PTY)
LTD
Respondent
Delivered:
This judgement was prepared and authored by the Judge whose name is
reflected herein and is handed down electronically
by circulation to
the Parties/their legal representatives by email and by uploading it
to the electronic file of this matter on
CaseLines. The date for
hand-down is deemed to be 3 June 2021.
JUDGMENT
BEZUIDENHOUT
AJ:
[1]
The application before me relates to a lease agreement and a claim by
the applicant
against the respondent for arrear rental in the amount
of R 1 035 405-52, arrear Municipal utilities account in
the amount
of R 470 429-44, and damages to the property when the
respondent vacated the property in amount of R 549 931-00.
THE
APPLICATION
[2]
In February 2015, the applicant and respondent entered into written
lease agreement
in terms of which the respondent leased from the
applicant, what the respondent referred to, as a high-end residential
property
situated in Hyde Park, Johannesburg.
[3]
In terms of the lease agreement the respondent was obliged to pay a
deposit of R 200 000-00
and monthly rental in the amount of R
100 000-00 per month.
[4]
The lease would endure for a period of 2 years.
[5]
The respondent furthermore undertook to pay for all electricity,
water, gas and other
utilities consumed on the property as well as
all charges/costs billed by the Body Corporate or Municipality
related to sewer,
and / or refuse disposal and so forth (COJ account)
but not the rates.
[6]
The respondent undertook to maintain the interior of the property and
all improvements,
fixtures and fittings, and to regularly clean the
carpets, curtains, blinds, and furniture, floor coverings and tiles
to ensure
that the property is in good and clean condition during the
period of occupancy.
[7]
The respondent paid the deposit
and took occupation of the property in February 2015.
[8]
According to the respondent when it took occupation of the property
the respondent
experienced problems with the irrigation system, the
indoor swimming pool leaked, the electrical system was faulty and
there was
a roof leak. According to the respondent it raised these
issues with the applicant however the applicant did not resolve the
issues.
[9]
The respondent paid the R
100 000-00 monthly rental but in or about September /October
2016 the respondent commenced to pay rental in the amount of R
75 000-00 per month in what appears to be a remission of rent
due to the defects in the property not being repaired and the
property thus not meeting the high standards the rent was, amongst
others, an indication of.
[10]
The respondent remained in occupation until August 2017, despite the
lease terminating by efflux
of time at the end of February 2017.
POINT
IN LIMINE
[11]
In its answering affidavit, the respondent raised a point in limine
to the effect that the lease
agreement that was concluded between the
applicant and respondent was transferred into the name of Mazwe
Investments (Pty) Ltd,
which is an entity separate from the
respondent. Accordingly, the respondent averred that the applicant
had brought the wrong party
before Court.
[12]
The respondent pleaded that in December 2015, its representative
directed correspondence to Gayle
Nelson, from Etchells & Young,
the property brokers who managed the property (the agent) and
enquired whether the lease can
be transferred into the name of Mazwe
Investments (Pty) Ltd.
[13]
On 14 December 2015, the agent reverted and indicated that she had
spoken to the owner of the
property, and he indicated that it was
fine for her to change the invoice name to Mazwe Investments (Pty)
Ltd and the invoices
were thereafter issued in the name of Mazwe
Investments (Pty) Ltd. The respondent alleged that the true
respondent is Mazwe Investments
(Pty) Ltd as the lease was
transferred by consent.
[14]
The applicant disputed that the lease was transferred from the
respondent to another entity.
The applicant contended that the name
on the invoice was changed, and this had the effect that a third
party facilitated payment
of the monthly rental amount, the lease
however remained intact between the applicant and respondent and was
not transferred to
a third party. The applicant pleaded that for the
lease to be transferred to a third party the applicant, respondent
and third
party should have all agreed in writing to the transfer of
the lease agreement from the respondent to the third party, which
according
to the applicant did not happen.
[15]
I quote the email correspondence on which the respondent depends for
its point in limine hereunder
for clarity purpose.
[16]
On 8 December 2015 the Respondent’s representative forwarded an
email to the agent in which
he stated that: “
Currently the
rental invoice and utilities are being made out to Mazwe Financial
Services on a monthly basis, we would like to change
this so that the
rental goes to a different company: Mazwe Investments (Pty) Ltd and
the utilities stay with Mazwe Financial Services
.”
[17]
The agent responded to this email on 9 December 2015 stating that:
“
Unfortunately we will not be able to do that as the lease
agreement was signed in the name of Mazwe Financial. Sorry
”.
[18]
On the same date the Respondent then responded to the agent and
asked: “
Please advise if we can change the lease agreement
contract to that of Mazwe Investments in its entirety. Would this be
possible
?”
[19]
On 14 December 2015, the agent replied and stated that: “
I
have spoken to Harry, he says it is fine for me to change the invoice
name. I will do this on Monday as I am on leave this week
.”
[20]
The respondent did not persist with this argument in its heads of
argument but from the above
it is evident that the parties did not
replace the respondent for Mazwe Investments and the point in limine
is dismissed.
PRESCRIPTION
[21]
The respondent raised the issue of prescription. In this regard the
respondent claimed that the
application was launched in June 2019 and
if regard is had to annexure B to the founding affidavit the arrears
began to accumulate
in June 2015, any debt which was due prior to
June 2016, would have become prescribed as the rental was payable on
a monthly basis.
[22]
The Applicant in its replying affidavit stated that “There is
no legal basis for prescription
of the Applicant’s claim for
outstanding rental other than stating that such amounts were not
claimed within 3 years, the
Respondent fails to state on what legal
basis these claims are to prescribe.”
[23]
The applicant went further and stated: “In any event, should
any legal basis exist for
such claims to have prescribed within 3
years, this claim could not have prescribed as prescription would
have been interrupted
when the Applicant filed action proceedings in
2016 claiming these amounts.”
[24]
In the heads of argument filed on behalf of the applicant the
applicant without referring to
authority repeated the fact that
because summons was issued in 2016 and again in 2019 the serving of
summons would have interrupted
prescription. The applicant however
failed to deal with the issue of it withdrawing both the actions
without prosecuting them to
finality and what effect that had on
prescription.
[25]
Counsel for the applicant argued from the bar that it is a trite
principle in law that payments
are set off against the oldest debt
hence the portion of the arrear rental that accrued prior to May 2016
had not prescribed.
[26]
Counsel for the respondent referred me to the matter of Standard Bank
v Miracle Investments 67
(Pty) Ltd and another
2017 (1) SA 185
(SCA)
where it was held that where payment is made in instalments, each
constitute a separate cause of action. He also referred
me to section
15 of the Prescription Act and more particularly to section 15(2)
which in essence holds that where a creditor does
not successfully
prosecute its claim to final judgment, the running of prescription
shall be deemed to not have been interrupted.
[27]
Counsel also referred to the judgment of Cadac (Pty) Ltd v
Weber-Stephen Products Company and
others
(2011) 1 All SA 343
(SCA)
where it was held that the withdrawal of a summons to institute
another action, meant that the 1
st
summons was not
prosecuted successfully and hence it did not interrupt prescription.
[28]
I have a difficulty with Counsel for the applicant’s submission
from the bar that the default
position applied and that the payments
received from the respondent were set off against the oldest debts;
this was not the case
the applicant made out in its pleadings and
secondly it is not what annexure B to its founding affidavit
reflected. In this regard
the applicant had set of each payment as it
was received from the respondent against the debt that was due for
that month, where
there was a difference between the debt due and the
payment received, it remained as an outstanding balance for that
month. On
the face of annexure B, it does not appear that the
applicant had applied the general principle that any monies received
for rental
would be used to settle the oldest debts first.
[29]
On the facts pleaded the rental claims prior to June 2016 have
prescribed and the rental amount
claimed must be reduced with the
amount of R 286 205-02.
RENTAL
[30]
The respondent admitted that the monthly rental due under the lease
agreement amounted to R 100 000-00
per month. The Respondent
admitted taking occupation of the property and paying the R
100 000-00 per month rental until September
2015. From October
2015, the respondent reduced the monthly agreed upon rental to R
75 000-00 per month out of frustration
with the applicant’s
failure to attend to the defects in the property which the respondent
brought to the applicant’s
attention.
[31]
The respondent did not seek a remission of rent and did not plead
facts which would allow for
an adjudication of the reduced value the
respondent would have been ordered to pay had it raised such a
defence.
[32]
The respondent is to pay to the applicant the shortfall in the
monthly rental for the period
July 2016 to February 2017.
DAMAGES
[33]
The respondent in its answering affidavit contended that the
applicants claim for repairs to
the damages to the property was not
justiciable on the papers. The applicant in its replying affidavit
disputed that the claim
was not being capable of adjudication on the
papers and even in its heads of argument the applicant insisted that
the claim for
damages was capable of adjudication on the papers.
[34]
The applicant dealt with the damages claim in the founding affidavit
in the following three paragraphs
which I reproduce hereunder:
[35]
“The respondent undertook to maintain the interior of the
property and all improvements,
fixtures and fittings and to regularly
clean the carpets, curtains, blinds and furniture, floor coverings
and tiles to ensure that
the property is in good condition during the
period of occupancy (clause 15.3.1 of the lease);
[36]
The respondent destroyed the interior of the property and some
furniture therein. The applicant
is obliged to pay for such repairs
at an amount of R 549 931-00. A copy of the quotation for the
costs of repairs is attached
and incorporated hereto as annexure D.
[37]
The amount of R 549 931-00 is presently due, owing and payable
which the respondent despite
demand failed and / or refuse to pay,
alternatively demand is made herewith.”
[38]
The respondent denied that it caused the damages as alleged and
averred that it appears as if
the applicant has upgraded the property
and claimed same as damages from the respondent. The respondent
denied the damages as contained
in the quotation and dealt amongst
others specifically with the DSTV, the swimming pool and so forth.
[39]
The applicant in reply stated that: “The respondent vacated the
premises overnight and
failed to appear for an inspection of the
property and therefore cannot deny the damage it has caused to the
property. An inspection
was done, and the damages are real. The lease
agreement is clear that the respondent is responsible for all damages
caused to the
property and must cover the costs thereof.”
[40]
The applicant attached as annexure D an invoice issued on its own
letter head. The invoice is
not addressed to anyone and does not have
an invoice number or VAT number. On the invoice there is a table
giving a description
of the various maintenance and or repairs and or
cleaning services that was executed at the property. In the righthand
column there
are values listed as costs.
[41]
Counsel for the respondent in its heads of argument referred to
various authorities indicating
that where there are material disputes
of fact, motion proceedings are not the appropriate avenue to follow
to bring a litigants
claim before Court.
[42]
Counsel had also referred to the cases indicating that motion
proceedings are not ideally suited
for damages claims although there
might be instances where such can be properly entertained.
[43]
It is trite law that in application proceedings the affidavit filed
in support of a claim or
defence must contain both the facts and
evidence on which such party relies to support its claim or defence.
It is also trite that
an applicant must make out its case in its
founding affidavit and include all the evidence and facts which will
be necessary to
sustain its claim in its founding affidavit.
[44]
The applicant’s founding affidavit fell far short of the
requirement that all the facts
and evidence upon which it bases its
claim for the damages to the property must be contained in the
founding affidavit, even the
replying affidavit fell far short of
being a proper response to the allegations raised by the respondent.
COJ
CLAIM
[45]
With the COJ claim the respondent contended that it made monthly
payments and that the account
the applicant attached included rates
which was not an item that it was responsible to pay under the lease
agreement. The applicant
had not dealt with this contention and the
applicant had furthermore only attached a statement with a balance to
its papers.
[46]
It is thus not possible to interrogate the COJ statement to assess
what has been included in
the amount claimed as outstanding and what
was paid and what not.
TENDER
[47]
The respondent, for the holding over period, 1 April 2017 to August
2017, it tendered rental
of R 75 000-00 per month which equate
to R 375 000-00 for the period. The respondent had set of the
deposit it paid which,
with interest, amounted to R 219 535-65.
The amount the respondent thus tendered in respect of the holding
over period amounted
to R 155 464-35.
[48]
In addition to the above the Respondent tendered to amount of R
100 000-00 towards the COJ
account for the period 1 April 2017
to August 2017.
[49]
The applicant accepted the respondents tender for the rental due for
the period April 2017 to
August 2017 as well as the tender of R
100 000-00 with regard to the COJ account for the period April
2017 to August 2017.
CONCLUSION
[50]
Counsel for the applicant requested at the hearing that the issue of
damages be referred to trail.
[50]
The applicant in its replying affidavit stated that it was entitled
to file and withdraw actions
in consideration of legal advice it
received. The applicant also stated that on a closer inspection of
the respondent’s reactions
to its summonses, it was clear that
the respondent had sought to delay the adjudication of the actions by
filing frivolous exceptions
over and over again. The applicant’s
allegations that these were frivolous exceptions borders on contempt
as an order by
this Court upheld the exception raised against the one
summons the applicant issued and afforded the applicant an
opportunity to
correct its pleadings.
[51]
The applicant claimed that it was justified to launch the current
application as it was a more
appropriate and expedient process in
resolving the issues between the parties.
[52]
The applicant furthermore indicated that it decided that motion
proceedings would result in both
parties having a speedy resolution
as opposed to action proceedings, as there was no anticipated
material dispute of fact.
[53]
The applicant had twice issued summons and twice withdrawn same. On
its own version it embarked
upon these proceedings in order to ensure
a speedy resolution of the issues in dispute between the parties. It
thus had to ensure
that it could meet its objective and include all
the facts and evidence it relied upon before Court in its founding
affidavit.
[54]
The applicant was aware of the respondent’s defences and was
not taken by surprise by any
of the defences raised by the
respondent.
[55]
Having regard to the applicant’s response to the respondent’s
answers in relation
to the damages claim it does not appear that the
applicant has a lot more to offer than what is contained in the
founding and replying
affidavits.
[56]
The applicants request that the issue of damages be referred to trail
is denied.
WHEREFORE
THE COURT ORDERS THAT:
1.
The respondent’s
point in limine is dismissed;
2.
The rental claim for
the period prior to June 2016 has become prescribed and the
applicants rental claim is reduced by R 286 205.02.
3.
The respondent is to
pay the applicant the following amounts as per its tender:
a.
The amount of R
155 464-35 for the rental period of March 2017 to August 2017,
and
b.
The amount of R
100 000-00 in regard to municipal services for the period March
2017 to August 2017.
c.
Interest on the
aforesaid amounts as from date of tender to date of final payment at
the prescribed rate of interest.
4.
The respondent is to
pay the applicant R 200 000-00 which equates to the R 25 000-00
shortfall in the rental it short-paid
for the period July 2016 to
February 2017.
5.
Interest on the
aforesaid amount at the prescribed rate of interest as from date of
service of the application to date of final
payment.
6.
The remainder of the
applicant’s claim is dismissed.
7.
Each party to bear its
own costs.
J
M BEZUIDENHOUT AJ
Acting
Judge of the High Court
DATE
OF HEARING
:
1 March
2021
DATE
OF JUDGMENT
:
3 June
2021