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[2011] ZAGPPHC 142
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ABSA Bank Ltd v SJ Coetzee Inc and Another (1574/10) [2011] ZAGPPHC 142 (27 May 2011)
NOT
REPRTABLE
IN
THE NORTH GAUTENG HIGH COURT,
PRETORIA
(REPUBLIC OF SOUTH AFRICA)
Case
No: 1574/10
DATE:27/05/2011
In the matter between:
ABSA BANK LIMITED
and
SJ
COETZEE
INC
..................................................................................................
1
st
Defendant
COETZEE,
SJ
.......................................................................................................
2
nd
Defendant
JUDGMENT
MNGQIBISA-THUSI,
J
[1]
The plaintiff is suing the defendants for provisional sentence on an
acknowledgement of debt signed by the second defendant
on 18 May 2009
on behalf of the first defendant and also as surety.
[2]
The first defendant was not represented at this hearing as it appears
that it is, as a consequence of an order granted in favour
of the Law
Society of the Northern Provinces, the first defendant is under the
control and administration of the Law Society.
[3]
As set out in the plaintiff's summons for provisional sentence, the
acknowledgement upon which the claim reads in part as follows:
"The Defendants
acknowledged that they are truly and lawfully indebted, jointly and
severally, one paying the other to be absolved,
to ABASA Bank
Limited, its successor in title and administrators or assigns in the
agreed amount of:
2.1.1.1 R734 641, 79
(seven hundred and thirty four thousand six hundred and forty one
Rand and seventy nine cents) owing to the
Bank as at 1 June 2009
arising from and being in respect of a letter of undertaking issued
in favour of the bank on 18 May 2009
..;
2.1.1.2 the capital Sum
would bear interest as follows
On
the R652 997,00 portion thereof at the rate of 10.5 percent per
annum; and
On
the R81 644,79 portion thereof at the rate of prime plus 8 percent
per annum;
Calculated
from 1 July 2009 to date of final payment. Such interest would be
calculated on a compounded daily basis on the total
balance owing to
the Plaintiff from time to time. In the event that the
acknowledgement of Debt is subject to the national credit
act, no 34
of 2005 ("the Act"), such interest would be the maximum
interest rate permitted by the Act."
[4]
It is common cause that:
4.1
The second defendant signed the acknowledgement of debts;
4.2
At the time the second defendant signed the acknowledgement of debt
she was acting on behalf of the first defendant; and
4.3
the defendants have not paid the plaintiff.
[5]
The second defendant, in her answering affidavit and in argument,
raised several points in limine. However, as conceded by counsel
for
the second defendant, the applicant has dealt with the defects raised
in the answering affidavit in its replying affidavit.
[6]
At the start of the proceedings the second defendant seemed to object
to the admission of the replying affidavit on the ground
that the
applicant did not attach its resolution wherein the deponent to the
replying affidavit, Lynn Ferguson, is authorised to
act on behalf of
the applicant. The second defendant has properly raised the non
attachment of Ferguson's authorisation. However,
this is not a
material factor in that it does not appear that the applicant did not
authorise Ferguson to depose to the replying
affidavit on its behalf.
Further, since the non attachment of the authorisation does not in
any way affect the merits of the case
as to whether the applicant
should be granted provisional sentence, and in the interests of
justice and in the absence of any evidence
vitiating the
authorisation of Ferguson, the replying affidavit is admitted.
[7]
The remaining points in limine raised by the second defendant are the
following:
7.1 that there is a
material difference between the date in the certificate of balance
and the date stated in the acknowledgement
of debt.
7.2 that the Law Society
of the Northern Provinces ("the Law Society") has not been
joined as a party to these proceedings.
[8]
The first point raised relates to the fact that the acknowledgement
of debt refers to the date of 11 August 2009 as the date
upon which
the defendants' debt becomes due and payable whereas the certificate
of balance attached to the applicant's papers mentions
the date of 11
June 2009. As correctly pointed out by the applicant, it appears that
the second defendant has misconstrued the
two dates referred to. On
reading the acknowledgement of debt and the certificates of balance
it is clear that the date of 11 June
2009 reflected in the
certificates of balances refers to the date on which the debt as
acknowledged becomes due and the 11 August
2009 is the date when the
debt is to be paid. I am of the view that this point raised by the
second defendant has no merit.
[9]
As appears from the replying affidavit the applicant only became
aware that the second defendant has been suspended by the Law
Society
from practising as an attorney on 16 November 2009 after it received
the second defendant's answering affidavit and after
making its own
enquiries. It was contended on behalf of the applicant's that there
was no need to join the Law Society in these
proceedings as it is a
condition precedent that before the plaintiff can make a claim to the
Fidelity Fund, it must have exhausted
its remedies against the
affected attorney first. On this basis I do not find that there is a
misjoinder of the law Society even
though it does have an interest in
the outcome of this case.
[10]
A person may only be summoned to answer a claim made for provisional
sentence where the claim is founded upon a liquid document.
If a
document on the proper construction thereof evidences by its terms
and without resort to evidence extrinsic thereto, ... an
acknowledgement of indebtedness in an ascertained amount of money,
the payment of which is due to the creditor., it is upon which
provisional sentence may properly be granted. Rich v Lagerwey
1974
(4) SA 748
(A) at 754H. Once served with a provisional sentence
summons the defendant must file an affidavit to admit or deny his
signature.
He also has to set forth the grounds of his defence to the
claim.
[11]
It appears that the acknowledgement of debt was signed by the second
defendant in her capacitv as an attorney and thereby representing
the
first defendant for a debt which was owed by certain Mr and Mrs
Bernado with regard to a transaction of the sale of certain
properties. As indicated above, the second defendant does not deny
that it is her signature which appears on the acknowledgement
of
debt. Further, the second defendant does not deny that she, together
with the first defendant owe the amount indicated in the
acknowledgement of debt to the applicant and that no payment has been
made.
[12]
The second defendant's defence to the claim for provisional sentence
is that even though the money is owed, the money is not
due and
payable until, as evidence by the letter of undertaking, the
registration of the properties which were the subject matter
of the
conveyancing transaction she performed for Mr and Mrs Bernado. It was
argued on behalf of the second defendant that since
the applicant had
not attached the letter of undertaking (Annexure A to the
acknowledgement of debt) to its summons for provisional
sentence,
which would have proven that the acknowledgement of debt did not
contain an unconditional undertaking to pay. It was
contended that
the undertaking to pay the applicant was subject to the registration
of the properties.
[13]
In her answering affidavit the second defendant also alleged, as a
ground of defence that the amount indicated in the acknowledgement
of
agreement was a loan she had obtained from the applicant for a debt
of Mr and Mrs Bernado. Counsel for the second defendant
did not
during argument pursue this argument. Since the second applicant did
not lay any basis for this allegation, I will not
deal with it any
further.
[14]
With regard to the letter of undertaking referred to in the
acknowledgement of debt, the plaintiff gave notice of its intention
to amend the provisional sentence summons in order to effect the
incorporation of the letter of undertaking referred to as annexure
A
in the summons. This notice of amendment was served on the second
defendant and she did not object to such amendment. As a result
the
letter of undertaking forms part of plaintiff's application.
[15]
As appears from the letter of undertaking, the defendants undertook
to pay the amounts owed by a certain Mr and Mrs Bernado
upon
registration of certain property for which the first defendant,
acting through the second defendant was the conveyancing attorney
in
the sale of the properties. Subsequent thereto it appears that the
registration of the said properties was effected on 29 May
2009.
However, the defendants did not pay the plaintiff as agreed on in the
letter of undertaking. As a result thereto the defendants
had signed
the acknowledgement of debt which forms the basis of the plaintiff's
claim.
[16]
In view of the above, it does not appear that the letter of
undertaking is relevant to the acknowledgement of debt in that
by the
time the acknowledgement of debt was signed the condition for payment
to the plaintiff, namely, registration of the mentioned
properties,
had already taken place. Plaintiff's counsel has correctly pointed
out that the letter of undertaking is merely a historical
recordal of
the background leading to the signing of the acknowledgement of debt.
[17]
In the premises, I am of the view that the acknowledgement of debt
signed by the second defendant and whose signature is not
denied by
the second defendant, is an unconditional undertaking by the
defendants to pay the plaintiff the amounts mentioned. It
is a liquid
document. The second defendant, as indicated earlier, has admitted
that it is her signature that appears on the acknowledgement
of debt.
Secondly the second defendant has admitted that no payments to the
plaintiff have to be made.
[18]
In view of the fact that the acknowledgement of debt is a liquid
document upon which provisional sentence may be granted, the
issue to
be decided is whether on probabilities the defendants have a defence
which could succeed in the principal case.
[19]
In submissions on behalf of the second defendant it is contended that
the transaction which formed the basis for the signing
of the
acknowledgement of debt is a loan which the plaintiff gave to the
defendants. It is therefore argued that such a loan falls
within the
provisions of the Credit Agreement Act and the plaintiff is not
entitled to provisional sentence since the provisions
of the Act have
not been complied with. However, from the documents before me,
nothing evidences the fact that the debt owed by
the defendants to
the plaintiff was a loan the plaintiff had granted to the defendants.
There is sufficient proof that the underlying
cause was the letter of
undertaking issued by the defendants to the plaintiff. The second
defendant did not provide any proof of
the existence of a loan save
to allege that provisional sentence be refused and the matter go to
trial where the necessary oral
evidence would be given to prove the
second defendant's allegation of a loan. The second defendant's
argument sound hollow in view
of the evidence before me.
[20]
I am satisfied that the plaintiff has made a proper case for the
granting of provisional sentence.
[21]
Accordingly the following order is made:
1.
Provisional sentence is granted in favour of the plaintiff in the
sum of R734 641,79 against the first and second defendants
jointly
and severally between the two defendants.;
2.
Interest on the capital amount to be paid as follows:
2.2
the sum of R652 997,00 of the capital sum at the rate of 10.5 percent
per annum;
2.3
the sum of R81 644,79 of the capital sum at the rate of prime plus 8
percent per annum, calculated from 1 June 2009 to date
of final
payment.
3. Costs of suit.
NP
MNGQIBISA-THUSI
Judge
of the North Gauteng High Court