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[2011] ZAGPPHC 88
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BMW Financial Services (South) Africa (Pty) Ltd v Homeware Building Construction CC and Others (55016/2010, 55016/2010) [2011] ZAGPPHC 88 (12 May 2011)
IN
THE NORTH GAUTENG HIGH COURT, PRETORIA
REPUBLIC
OF SOUTH AFRICA)
Case
Number: 55016/2010
Case
Number: 55017/2010
DATE:12/05/2011
In
the matters between:
BMW
FINANCIAL SERVICES (SOUTH)
AFRICA
(PTY)
LTD
..........................................................................................................
Plaintiff
and
HOMEWARE
BUILDING CONSTRUCTION
CC
.................................................
First
Defendant
TSHAWE
JOSEPH
...........................................................................................
Second
Defendant
TSHAWE
GEORGE
..............................................................................................
Third
Defendant
MANDLAZI,
LYNNETH
BASANI
........................................................................
Fourth
Defendant
JUDGMENT
In
both these matters the Plaintiff entered into an instalment sale
agreement with the First Defendant for the sale of certain BMW
motor
vehicles. In case number 55016/10 the agreement was concluded on 27
June 2008 and in case number 55017/10 the agreement was
concluded on
23 May 2008.
In
both cases, the Second, Third and Fourth Defendants signed suretyship
agreements in respect of the First Defendant's debts in
respect of
the respective instalment sale agreements.
The
total outstanding debts were payable in monthly instalments of R6
387,84 and R6 817,94 respectively.
In
both cases reference were made in the particulars of claim of certain
annexures, i.e. Annexure "A", the instalment
sale
agreement, Annexure "B", a notice in terms of section 129(1
)(a) of the National Credit Act and Annexures "C",
"D"
and "E" being the respective suretyship agreement signed by
the Second, Third and Fourth Respondents.
When
the summonses were served these annexures were not annexed and when
the Defendants entered their appearances to defend on 18
October
2010, notices in terms of Rule 25(12) were simultaneously filed,
calling for the production and inspection of the said
Annexures.
On
the 29 October 2010 the Plaintiff filed a notice to apply for summary
judgment in both cases and it was set down for hearing
on 7 February
2011. The Defendants were out of time with the filing of their
opposing affidavits which were only handed to the
Plaintiff on the
day of the hearing on 7 February 2010, which necessitated a
postponement of the summary judgment application and
the Defendant
thereupon moved a formal application for condonation. The condonation
application is not being opposed and it was
therefore granted.
In
their opposing affidavits the Defendants advanced 7 points in limine
and further contended that they have a counterclaim against
the
Plaintiff. Mr Springveldt, who appeared on behalf of the Defendants,
conceded the first and third of these points but persisted
in the
remaining thereof in his argument addressed to me in Court.
Mr
Groenewald, who appeared for the Plaintiff, argued that none of the
remaining points had any merit and requested my to grant
summary
judgment against the First Defendant for re-delivery of the two motor
vehicles respectively to the Plaintiff.
Mr
Groenewald's argument goes a long way in exposing the demerits of the
Defendants arguments in defence of the remaining points
in limine and
as far as the alleged counterclaim could possibly stand as a defence,
but I do not find it necessary to further deal
with any of these
arguments because of what follows:
The
relevant terms of the agreements which were identical as far as the
terms thereof are concerned, inter alia read as follows:
"11.1
An event of default shall occur if you:
11.1,1
- fail to make punctual payment of any of the amounts payable. 11.3 -
Upon an event of default the seller may... 11.3.1 -
If this agreement
is not subject to the provisions of the NCA: 11.3.1.1 - Claim
immediate payment of ail amounts payable, whether
then due or not,
provided however that if you do not make immediate payment the seller
may, notwithstanding the election to claim
immediate payment in terms
of this sub-clause, claimed the relief set out in 13.3.1.2 below".
Clause
13.3.1.2 then reads as follows:
"After
due demand, cancel this agreement (and) obtain possession of the
goods..."
Clause
11.3.2 makes provision for the procedure to be followed if the NCA is
applicable to the agreement and then makes provision
for a section
129 notice in terms of the said Act to be delivered to the buyer and
then provides, if not responded thereto that:
"11.3.2.2
...The seller may claim payment of all amounts payable whether then
due for payment or not, provided however that
if you do not make
payment the seller may notwithstanding the election to claim payment
in terms of this sub-section, claim the
relief set out in 11.3.2.3
below".
Section
11.3.2.3 referred to states as follows:
"After
due demand referred to in 11.3.2.1 above cancel this agreement (and)
obtain possession of the goods..."
Whether
or not the NCA is applicable to the agreement, the contracts make
provision for cancellation of the agreement on default
of payment
after due demand has been made.
The
Plaintiff's causes of action as set out in the particulars of claim
can be summarised as follows:
1.
The conclusion of the instalment sale agreements.
2.
Delivery of the BMW motor vehicles to the First Defendant pursuant
thereto.
3.
The First Defendant is in default of payment in each instance.
4.
Due demand has been made.
The
Plaintiff claims an order for inter alia:
(a)
Confirmation of the cancellation of the instalment sale agreement:
(b)
Re-delivery of the motor vehicles respectively.
For
its due demand Plaintiff relies on notices sent in terms of section
129(1 )(a) of the National Credit Act and to which reference
were
made in the particulars of claim. As mentioned, these notices were
not attached and the response to the Defendant's Rule 35(12)
notice
was only forthcoming on the 19th April 2011.
In
its reply to the Rule 35(12) notice, Plaintiff states in paragraph 2
thereof, that copies of the section 129(1)(1) notices are
furnished,
as well as proof of posting thereof.
I
will accept, without deciding, that these notices were properly sent
to the Defendants and I will further accept without deciding
that it
may be regarded as proper actions taken in terms of clause 11.3.1.1
alternatively clause 11.3.2.2 of the agreements.
I
will accept therefore, in the Plaintiffs favour, that the notices
dated 11 May 2010 constituted a proper demand as required by
clause
11.3.1.1 alternatively clause 11.3.2.2 depending on whether or not
the NCA is applicable to the agreements.
It
becomes clear, therefore that the Plaintiff, in order to succeed in
an action to claim re-delivery of the respective motor vehicles,
will
have to allege and proof, in addition to the allegations presently
made, that the contracts were duly cancelled.
The
demand, contained in the said notices only state:
"Should
you fail to respond to this notice, or respond by rejecting BMW
Financial Services' proposal within 10 business days
of delivery of
this notice and you have been in default for 20 business days, we
will proceed to institute legal action against
you to enforce the
provisions of the agreement." (My emphasis)
The
provisions of the agreement have been referred to above. In order to
entitle the Plaintiff to claim re-delivery of the vehicles
it is
essential that the agreements must first be cancelled lawfully. As
long as the agreements remain in force the First Defendant
is not
only entitled but obliged to in terms of clause 7.1.1 thereof "keep
the goods in (its) possession or under (its) control
at all times".
It is therefore an essential allegation and central to the causes of
action of the Plaintiff that the particulars
of claim should contain
an allegation that the agreements have been cancelled. Only in such
an event would the Plaintiff be entitled
to re-delivery of the
vehicles.
In
my view the causes of action set out in the respective particulars of
claim are therefore fatally defective and do not sustain
the relief
claimed.
The
prayer for an order confirming the cancellation hangs in the air, and
in any event such a declaratory order falls outside the
ambit of
orders that may be granted in terms of Rule 32(1).
In
the absence of an allegation that the contracts have been cancelled
no cause of action is set out to sustain the relief claimed
in prayer
2, for the return of the respective motor vehicles.
It
would appear from the Plaintiffs response to the notice in terms of
Rule 35(12), that apart from furnishing copies of the section
129(1)
notices as well as proof of posting thereof, a copy of a further
letter, apparently addressed to the Second Defendant was
also
furnished. The letter states in its concluding paragraph that:
"...
we hereby notify you that the agreement has been duly cancelled".
The
status of this letter is unclear. No reference thereto is made in the
particulars of claim and it was also not annexed thereto.
It
therefore does not form part of or amplify the Plaintiff's cause of
action as set out in the particulars of claim.
It
remains to mention that the issue of cancellation dealt with in this
judgment was not canvassed or argued before me. It is only
after I
read the papers after having had reserved judgment in both matters,
that I discovered this omission in the Plaintiffs particulars
of
claim. I did not find it necessary to call for further arguments from
counsel in this regard.
In
the result the Plaintiff failed to make out a proper case for summary
judgment and I therefore intend not to only grant leave
to defend but
to dismiss the applications for summary judgment.
Such
a dismissal would normally be accompanied by a costs order against
the unsuccessful Applicant but in the present two matters
I intend to
follow a different course.
Quite
some time was spent in open Court in arguing these two matters by
both counsel. Neither of them at any stage brought my attention
to,
what I now have find to be a fatal defect in the particulars of
claim, disentitling the Plaintiff to claim summary judgment
on the
papers as they stand.
As
pointed out earlier in this judgment, this is something that I only
discovered after I had re-read the papers after the matter
had been
postponed because judgment was reserved. If this matter was brought
to my attention immediately once this matter was called
it would have
saved a lot of time and trouble. I am therefore of the view that the
costs order that I intend to make is fair to
all the parties.
I
therefore make the following order:
1.
The application for summary judgment is dismissed in both cases.
2.
The Defendants are ordered to file their pleas within 10 Court days
from date hereof.
3.
Each party is to pay its own costs.
4.
The costs occasioned by the granting of the condonation application
are to be paid by the Defendants jointly and severally,
the one
paying to other to be resolved.