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[2010] ZAWCHC 626
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Nedbank Ltd v Masiqhame Trading 213 CC and Others (20081/2009) [2010] ZAWCHC 626 (10 December 2010)
7
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE HIGH COURT, CAPE TOWN)
Case no: 20081/2009
NEDBANK
LIMITED
…..........................................................................................................................
Plaintiff
v
MASIQHAME
TRADING 213CC
…..............................................................................................
1
st
Defendant
AKEELA
PALEKER
…................................................................................................................
2
nd
Defendant
HOPE
FOUNTAIN INVESTMENTS 205CC
….............................................................................
3
rd
Defendant
GHULAM
KADIR PALAKER
…...................................................................................................
4
th
Defendant
ISMAIL
KADER PALEKER
….....................................................................................................
5
th
Defendant
HALIMA
PALEKER
….................................................................................................................
6
th
Defendant
COALITION
TRADING 494CC
REGISTRATION
OFFICE
….......................................................................................................
7
th
Defendant
JUDGMENT DELIVERED
THIS THURSDAY, 10 DECEMBER 2009
CLEAVER
J
[1]
The plaintiff applies for summary judgment against the 2
nd
to
7
th
defendants
inclusive. The plaintiff has two claims against the first defendant.
The first claim is for payment of R745 471.92,
plus interest due on
an overdraft facility granted to the first defendant which was
called up by the plaintiff. The second claim
is for payment of the
sum of R227 744.34 advanced by plaintiff to the first defendant on a
loan account which account has similarly
been called up by the
plaintiff.
[2] It is common cause
that after the issue of summons the first defendant was liquidated.
Plaintiffs claims against the second
to seventh defendants are based
on separate deeds of suretyship signed by the defendants in terms
whereof they bound themselves
as sureties and co-principal debtors
for the liability of the first defendant to the plaintiff.
[3] In opposing the
application for summary judgment the second to seventh defendant
rely firstly on defences which they say would
have been available to
the first defendant and also on other defences.
THE OVERDRAFT ACCOUNT
[4] The agreement in
terms whereof the plaintiff advanced funds to the first defendant on
overdraft is described in the summons
as a partly written and partly
verbal agreement. It is the written portion of the agreement on
which the defendants rely for
their defences. The written portion
consists of a letter (the facility letter) addressed by the
plaintiff to the members of the
first defendant. The opening two
paragraphs read as follows:
'We
refer
to recent discussions between the Business Banking Division of
Nedbank Limited ('Nedbank Business Banking') and Masiqhame
Trading
213 CC, Hope Fountain Investments 205 CC, Coalition Trading 494CC
(referred to as 'the borrower'), duly represented by
Hilton Davids
and I K Paleker.
We have conducted a
review of your overdraft facility and confirm that we are satisfied
to allow this facility to continue at
the current limit upon the
same terms and conditions until the next review."
Sixteen paragraphs are
then listed with paragraphs 1. and 2. reading as follows:
"1.
BORROWER
a) Masiqhame Trading
213 CC (Reg No 2004/105730/23)
b)
Hope Fountain Investments 205 CC (Reg No 2006/075778/23)
c)
Coalition Trading 494 CC (Reg No 2004/082949/23)
2.
LENDER
Nedbank Limited (Reg
No 1951/000009/06)"
In paragraph 3 the
facilities granted to the three entities referred to in paragraph 1
are set out in detail with all the other
terms and conditions which
were to apply to the granting of the facilities being listed in the
remaining paragraphs. The letter
is signed on behalf of the
plaintiff by a business manager and credit manager with the final
portion reading as follows:
"On signature
hereof we, the undersigned, for and on behalf of the Paleker group:
confirm that prior to
signature hereof, we obtained the requisite authority from all
entities forming the Paleker group as defined
herein, to sign this
agreement for and on behalf of the said Paleker group;
acknowledge,
understand and agree to abovementioned facilities being taken up by
the Paleker group, subject to the terms and conditions
as set out
above:"
The
letter was signed by the fifth defendant above the inscription
authorised
signature".
[5]
The first defence, which is a point taken
in
limine,
appears
from the affidavit of the fourth defendant who says:
I
am
advised there is a reasonable possibility that the Agreement which I
signed on 12 May 2008 may be null and void for want of
my authority
to enter into such Agreement on behalf of a juristic entity which
does not exist or is not described and / or defined
in the Agreement
and that this Agreement may be void
ab
initio."
The submission on behalf
of the defendants was that since the fifth defendant's signature
accepting the terms for the facilities
granted to the first, third
and seventh defendants appeared to have been appended for and on
behalf of the Paleker group and
since there was no indication as to
the status of the Paleker group, the agreement could possibly be
void. In my view there is
no merit in this submission. To start with
the fourth defendant in his opposing affidavit admits that in or
about May 2008 the
first defendant was indebted to plaintiff on its
current account in the amount of approximately R2 million. The
fourth defendant
records that at that time and in consultation with
the first defendant's accountant and the plaintiffs representatives,
it was
agreed that the first defendant's overdraft facility would be
reduced by an amount of R1 250 000 in the following manner:
The sixth defendant
would take on R1 million additional debt on its existing loan;
The first defendant
would convert an additional amount of R250 000 into a term loan
repayable over 60 months at the rate of
R6 053.35 per month.
Significantly, the fifth
defendant does not deny that he was at all relevant times a member
of the first defendant and that he
was therefore in that capacity
authorised to enter into agreements on behalf of the first
defendant. He also does not deny that
he had the necessary authority
to sign the facility letter in respect of the cheque account of the
first defendant and furthermore,
he does not allege that he signed
the facility letter in error.
In
my view the defence that there was no valid agreement between the
plaintiff and the first defendant for the operation of the
cheque
account with overdraft facilities cannot be
bona
fide.
[6]
The certificate of balance in respect of the amount owing on the
overdraft account reflects the account number allocated by
the bank
as
"49264710002
(previously 149812256)".
In
the opposing affidavit, the deponent says that he has no knowledge
of when or if the plaintiff changed the first defendant's
current
account number and the defendants appear to suggest that by changing
the number, they have in some manner been afforded
a defence. There
is no merit whatever in this suggestion. The number of the cheque
account does not affect the amount claimed
under that account.
[7] The next defence
raised is that the arrangements in terms whereof the overdraft
facilities were granted to the first defendant
were that the first
defendant would be granted such facilities up to an amount of R750
000. It was submitted that since the amount
claimed from the first
defendant under this heading was less than R750 000. the amount was
not due and furthermore it was contended
that the plaintiff had not
made written demand on the first defendant in terms of the
conditions attached to the grant of the
facility. The facility
granted to the first defendant was an overdraft facility and as
usual in respect of such facilities, the
facility letter contains
the following clause under the heading 'GROUNDS FOR MAKING DEMAND'.
"e)
Notwithstanding the above, nothing herein contained shall prejudice
Nedbank's right to demand repayment of the facility
at any time."
In the summons it is
alleged that the first defendant is in breach with its agreement in
that it has exceeded the limit and/or
the duration of the facility
and/or has failed to make punctual payments in redemption thereof.
However, in the alternative,
payment was claimed on the basis of the
plaintiffs right to call for payment on demand in terms of the
condition which I quoted.
In the circumstances there is no merit in
this defence.
[8] Three defences said
to be available to the first defendant are raised in respect of the
plaintiffs second claim against the
first defendant. To start with,
the certificate of balance is challenged. Secondly, it is contended
that the first defendant
had sufficient funds in its account from
which payments were to have been transferred to the credit of the
loan account and that
the conduct of the plaintiff calls for an
explanation and finally it is said that the amount owing to the
plaintiff is disputed.
The deeds of suretyship signed by the
defendant provide that:
"The nature and
amount of my obligation, as well as the interest rate payable in
respect thereof shall be determined and
proved by a certificate
purporting to have been signed by a manager or accountant for the
time being of any branch or the Head
Office of Nedbank."
The
certificate of balance attached to the summons was signed by one
Anne Hilde Bezuidenhout ("Bezuidenhout") whose
position
with the plaintiff is recorded as Manager: Legal Recoveries, Legal
Recovery Centre: Western Cape. The affidavit in support
of the
application for summary judgment is signed by Bezuidenhout and
Coenraad Frederick Pieterse who are described as managers
of Nedbank
Limited. The purpose of the certificate of balance annexed to the
particulars of claim is to serve as
prima
facie
evidence
of the amount due. The amount has again been confirmed by the two
managers who signed the affidavit in support of the
claim for
summary judgment.
[9]
The defence raised as to the amount claimed is not understood and in
my view does not constitute a
bona
fide
defence.
After listing certain debits and credits, the fifth defendant
records that he has no knowledge as to why the plaintiff
reversed
certain payments and concludes:
"and I
respectfully submit that this calls for an explanation of such by
the plaintiff."
He alleges that the
first defendant had sufficient funds to accommodate payments which
were reversed by the plaintiff and then
concludes:
"Notwithstanding
the above I am equally at a loss to understand how in the
circumstances and taking the Plaintiff's version
of events into
account that an amount of R51 351.34 has been paid from the First
Defendant's Current Account to the First Defendant's
Term Loan
Account how the balance can be R227 744.34 and this calls for an
explanation of such by the Plaintiff."
There
is no indication in the papers as to where the amount of R51 351.34
referred to by the fifth defendant is to be found. Furthermore,
the
list of payments and credits which is referred to is suspect to say
the very least, since the defendant's counsel advised
from the Bar
that the very first entry referred to in the affidavit may be
incorrect to the extent of some R300 000. To avoid
summary judgment
a defendant must disclose fully the nature and grounds of the
defence and the material facts relied upon therefor
and must also
disclose a defence which is
bona
fide.
In
Hendricks
v Saacks and Another.
1
it
was held that a defence which was to the effect that the alleged
cancellation must be subject to
"the
gravest suspicion"
was
held to be insufficient, the court holding that the defendant had
had ample time to test, by search and by asking for particulars
the
accuracy of the statement made in the summons. In the present case
the amount claimed is not disputed as such and in any
event, it
would seem that at best for the defendants that the contention is
that the amounts payable in January and March 2009
should have been
paid from the current account. However, in my view, there is not
sufficient before the court to make that finding.
[10]
The second, fifth and sixth defendants contend, in addition to the
other defences raised by them, that the action against
them is to be
stayed since they are presently under debt review in terms of the
National Credit Act No 34 of 2005 ("the
NCA"). It is clear
from the papers that these defendants are in fact under debt review
and that steps are currently being
taken by a debt counsellor to
restructure their debts. It is also clear that the amounts claimed
from them by the plaintiff have
been included in the debts under
consideration by the debt counsellor in respect of the fifth and
sixth defendants. On behalf
of the plaintiff, it was submitted that
the NCA does not apply since the plaintiff is not a credit provider
and agreement relied
upon are not credit agreements as defined in
the NCA; and that consequently the second, fifth and sixth
defendants are not entitled
to the protection of the NCA. In my view
this cannot be correct. The NCA has as its objective
inter
alia
to
provide for debt reorganisation in the cases of over-indebtedness
and since the defendants in question are already subject
to debt
review, it would be quite incorrect to exclude them from that
protection in the present case. If I should be wrong on
this aspect,
I would in any event exercise my discretion in favour of these
defendants.
[11] The fourth
defendant is not under debt review and relies solely on the defences
which I have already dealt with.
[12] On behalf of the
plaintiff it was submitted that any judgment against any of the
defendants should include a punitive costs
order. The basis for this
submission was that the defendants had burdened the record
unnecessarily with prolix documentation
and also that the
adjournment of the hearing had been caused by the request on behalf
of the second, fifth and sixth defendants
to submit an affidavit
making it clear that they were under debt review. In my view a
punitive costs order is not called for.
In the order which follows,
I make provision for the payment of costs and for the guidance of
the taxing master, I direct that
one half of the costs of the
hearing of the application should be allocated to the case against
the third, fourth and seventh
defendants and the remainder to the
case against the second, fifth and sixth defendants. Counsel are at
liberty to approach me
immediately after judgment has been handed
down if they wish this allocation to be altered in any way.
[13] The following
orders will issue:
1. Summary judgment is
granted against the third, fourth and seventh defendants jointly and
severally, the one paying the other
to be absolved, for:
1.1. Payment of the
amount of R745 471.92;
1.2. Interest on R745
471.92 at the rate of 10.50% per annum, calculated daily and
capitalised monthly from 21 August 2009 to
date of payment, both
dates inclusive;
1.3. Payment of the
amount of R227 744.34;
1.4. Interest on R227
744.34 at the rate of 11.50% per annum, calculated daily and
capitalised monthly from 21 August 2009 to
date of payment, both
dates inclusive;
1.5. Costs of suit.
The application for
summary judgment against the third, fifth and sixth defendants is
refused and leave is granted to these
defendants to defend the
action. The costs incurred in respect of these defendants will
stand over for later determination.
R
B CLEAVER
1
1945
CPD 270
at 272