Vena and Another v Vena and Others (2461/2008) [2009] ZAECPEHC 26; 2010 (2) SA 248 (ECP) (28 May 2009)

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[2009] ZAECPEHC 26
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Vena and Another v Vena and Others (2461/2008) [2009] ZAECPEHC 26; 2010 (2) SA 248 (ECP) (28 May 2009)

FORM A
FILING SHEET FOR EASTERN CAPE
HIGH COURT, PORT ELIZABETH JUDGMENT
ECJ:
PARTIES
:
PHINDILE ALFRED VENA
And
NOMTHANDAZO
VENA
KHANYISA
DISTRIBUTORS
ROLAND
MEYER N.O.
Registrar:
2461/08
Magistrate:
High
Court:
EASTERN
CAPE HIGH COURT, PORT ELIZABETH
DATE
HEARD:
20/05/09
DATE
DELIVERED:
28/05/09
JUDGE(S):
JONES
J
LEGAL
REPRESENTATIVES –
Appearances:
for
the Applicant(s):
ADV:
J.D. Huisamen
for
the Respondent(s):
ADV:
B.S. Dyke
Instructing
attorneys:
for
the Applicant
(s):
BOQWANA
LOON & CONNELLAN ATTORNEYS
for
the Respondent
(s):
JONKELOWITZ
& SCHARGES ATTORNEYS
CASE
INFORMATION -
Nature
of proceedings
:
APPLICATION
FOR LEAVE TO APPEAL
Possibly
reportable
THE
HIGH COURT OF SOUTH AFRICA
In the Eastern Cape High Court
Port Elizabeth Case No 2461/2008
In the matter between
PHINDILE ALFRED
VENA Applicant
and
NOMTHANDAZO VENA 1
st
Respondent
KHANYISA DISTRIBUTERS CC 2
nd
Respondent
ROLAND MEYER N.O. 3
rd
Respondent
SUMMARY:
Application
for leave to appeal – on the ground that there was a reasonable
prospect (a) that it was erroneous to dismiss the
claim solely
because the matter was not urgent and (b), on the merits, that the
court should have found that payment other than
in cash or by
irrevocable guarantee does not amount to payment in law – while
there were reasonable prospects in respects on
the urgent point it
would be superfluous to give leave on that ground if there were not
also prospects on the merits – on the
facts there were no prospects
on the merits – leave to appeal refused. The dismissal of an
application does not necessarily preclude
an applicant from
re-instituting his application, because an order dismissing an
application is akin to an order for absolution
from the instance. The
court considered the propriety of dismissing an application solely
for want of proof of urgency and without
reference to the merits,
instead of striking it off the roll. This may be justifiable in cases
of an abuse of the urgency
procedure.
JUDGMENT
JONES J:
[1] This is an application for leave
to appeal against an order dismissing an application with costs. It
was preceded by an application
for an order condoning the applicant’s
failure to bring this application within the time laid down by the
rules of court. The
application was one day late. The lateness is
properly explained and does not give rise to prejudice. Condonation
is therefore
granted.
[2] The litigation arises out of the
settlement of a divorce action between the applicant and his wife,
the 1
st
respondent, who are the real parties to the present dispute. The
settlement provided for the appointment of a receiver, the 3
rd
respondent, to realise, liquidate and distribute the remaining assets
in the joint estate. For present purposes, the remaining
assets were
the 50% interest of the applicant and the 1
st
respondent in two closed corporations, (a) Khanyisa Distributors CC,
the 2
nd
respondent, which operates the business of a service station at
certain premises at Uitenhage, and (b) Meondo CC which operates
a
franchise known as Budget Meat and Grillers from the same premises.
Each party wanted to take over the 50% share held by the
other. The
closed corporations were related in such a way that the disposal of
the service station business to one party meant
that the meat
franchise business would also have to go to that party. The parties
negotiated for a fair basis upon which one or
the other would acquire
them. The method they agreed to was that both parties would submit
offers for the service station closed
corporation to the receiver who
would accept one of the offers; the successful offeror would take
over the two closed corporations,
and the other party would be paid
out for his or her half share, which was determined by the amount of
the successful bid. The
applicant submitted an offer for R1 400
000-00. The 1
st
respondent submitted an offer for R1 700 000-00. The 1
st
respondent’s offer was accepted. The parties entered then into a
written agreement dated 16 September 2008 – annexure PAV 2
– in
order to provide for the way forward. The agreement recorded the
offers and the acceptance of the 1
st
respondent’s offer, and provided that the 1
st
respondent was given a stipulated period after the date of acceptance
to make payment to the receiver. If she failed, the applicant’s
bid
would stand as the accepted bid, subject to the same condition
relating to payment.
[3] The applicant took the view that
the 1
st
respondent failed to meet the deadline, with the result that her
offer fell away and his offer become the accepted offer. The 1
st
respondent considered that she had, on the contrary, indeed made
payment as required by the agreement, annexure PAV 2. The result
was
that the applicant brought an application as a matter of urgency for
an order upholding his contentions. He applied for a rule
nisi
(a) requiring the 1
st
respondent to vacate the premises of the service station and to hand
the keys to the receiver, and (b) requiring the receiver to
accept
his offer of R1 400 000-00, and to transfer the 1
st
respondent’s interest in the service station closed corporation
into his name. He further asked for the rule to operate as an
interim
interdict pending the return day.
[4] I dismissed the application. I did
so on two bases. First, I held that the applicant had failed to prove
grounds of urgency
which justified a departure from the normal rules
of court, and, following
Caledon
Street Restaurants CC
v
Monica D’Aviera
(unreported Eastern Cape High Court, Port Elizabeth reference No
2656/97 SECLD, 7/11/1997, Kroon J) where the facts are not markedly

dissimilar, I ruled that the application should be dismissed without
reference to the merits. I decided nevertheless to deal with
the
application on the merits, which was the second basis for my
conclusion. The application for leave to appeal is based, first
on
the contention that I should not have dismissed the application for
want of urgency, but should instead have simply struck the
matter off
the roll; and, secondly, on the ground that the 1
st
respondent’s payment was not a legally valid payment.
Urgency
[5] My finding was that the
applicant’s allegations did not comply with rule 6(12)(b) which
requires him to set out explicitly
the circumstances rendering the
matter urgent and also the reasons why he will not be afforded
substantial redress at a hearing
in the ordinary course. He gave no
reasons at all why he could not get substantial redress at a hearing
in due course. The circumstances
allegedly giving rise to the
commercial urgency upon which he relied were the reverse of being
explicit. Instead, they were set
out in vague, incomplete, and
insubstantial terms and did not seem to me to have bearing on the
relief sought in the notice of
motion or the issues in dispute, other
than that the divorce between the parties was disruptive of the
business of the service
station. The grounds of urgency alleged
certainly did not justify giving the respondents two court days
within which to give notice
of an intention to oppose and to file
opposing affidavits. A postponement was inevitable and was granted.
The 1
st
respondent filed her opposition as soon as reasonably possible, on 12
December 2008. The applicant’s replying affidavit was
not filed
until 8 January 2009. He gave no explanation for his delay and one is
therefore left in doubt about the
bona
fides
of his case for
urgency. The urgency appears to have completely disappeared. In
consequence, I find myself echoing the remarks of
Kroon J at page 21
of the judgment in
Caledon
Street Restaurants CC
that
‘in my judgment, therefore, the use that the applicant made of the
procedure relating to matters of urgency was a misuse,
indeed an
abuse, of the process of the court. On that ground alone I find that
the applicant should be non-suited’.
[6] I do not believe that there are
reasonable grounds that another court will depart from the findings
of fact and the inferences
to be drawn there from. Nevertheless, I
would have granted leave to appeal on the urgency issue on a point of
law if that had been
the only reason for the dismissal of the
applicant’s claim. This is because Mr
Huisamen
has drawn my attention to the decision of the Supreme Court of Appeal
in
Commissioner, South
African Revenue Services
v
Hawker Air Services (Pty) Ltd; Commissioner, South African Revenue
Service V Hawker Aviation Partnership And Others
[2006] ZASCA 51
;
2006 (4) SA 292
(SCA) where, in dealing with dismissal of a claim for
want of urgency, Cameron JA is reported as follows (at 299G-300A para
9,
footnotes omitted):
One
of the grounds on which Patel J dismissed the applications was that
at their inception they had lacked urgency. This was erroneous.

Urgency is a reason that may justify deviation from the times and
forms the Rules prescribe. It relates to form, not substance,
and is
not a prerequisite to a claim for substantive relief. Where an
application is brought on the basis of urgency, the Rules
of Court
permit a Court (or a Judge in chambers) to dispense with the forms
and service usually required, and to dispose of it
'as to it seems
meet' (Rule 6(12)(a)). This, in effect, permits an urgent applicant,
subject to the Court's control, to forge its
own Rules (which must
'as far as practicable be in accordance with' the Rules). Where the
application lacks the requisite element
or degree of urgency, the
Court can, for that reason, decline to exercise its powers under Rule
6(12)(a). The matter is then not
properly on the Court's roll, and it
declines to hear it. The appropriate order is generally to strike the
application from the
roll. This enables the applicant to set the
matter down again, on proper notice and compliance.
[7] I have two comments. First, I do
not understand this judgment to place any restriction on the
discretion of a trial court to
dismiss a claim as a mark of its
displeasure at an abuse of the process of the court, whether it is an
abuse of the procedure of
urgency or any other procedure. The issue
of abuse of the process of the court was not raised or considered by
the Supreme Court
of Appeal. The judgment may, therefore, not be
applicable in this case.
[8] Second, the judgment suggests that
an order striking the application from the roll is an appropriate
order because, in that
event, the matter can be set down again after
proper notice is given. It is indeed so that the applicant should, if
so advised,
not be deprived of the right to set the matter again.
That is why I did not give judgment for the respondents but instead
made
an order dismissing the claim. My understanding of an order for
the dismissal of a claim in circumstances such as these is that,

generally speaking, it is equivalent to an order for absolution from
the instance, in which event it is open to an applicant to
set the
matter down again. In a given set of circumstances, it may be that
dismissal may amount to a final judgment on an issue,
with the
consequence of
res judicata.
But that is not in the
normal course where the case turns on a procedural point, and, I
believe, it is not the case here. The correct
position, as I see it,
is stated in
Herbstein and
Van Winsen The Civil Practice of Supreme Court of South Africa
5
th
ed at 684. The learned authors describe some of the orders that a
court may make in the following terms:
‘
The court may grant judgment
outright in favour of the either party, or
it
may give absolution from the instance or, what amounts to the same
thing, dismiss the action’
(my emphasis).
The term absolution from the instance
is not usually used in motion procedure; the order is almost always
to dismiss the application.
In support of the statement that
dismissal of an action amounts to same thing as absolution from the
instance, the learned authors
cite
Cloete
v
Greyling
(1907) 24 SC 57
;
Municipality of Christiana
v
Victor
1908
TS 1117
;
Eldred
v
Van Aardt and Bell
1924
SWA 79 82;
Becker
v
Wertheim, Becker &
Leverson
1943 (1) PH F34
(A); and
Bulford
v
Bob White’s Service
Station (Pvt) Ltd
1973 (1)
SA 188
(RA) 193G.
See
also
Regering
van die RSA
v
SA
Eagle Versekeringsmaatskappy
1985
(2) SA 42
(O) 56J-57D.
There
is a measure of reservation on the point in
Purchase
v
Purchase
1960
(3) SA 383
(N) 385A
where the order, however, was not the dismissal of the claim. The
court made no order on an application but gave the applicant
leave to
apply on the same papers, if so advised, on proper notice to the
respondent (see rule 6(6)). The weight of authority,
including the
Appellate Division authority of
Becker
v
Wertheim
Becker & Leverson supra
,
supports the statement in
Herbstein
and Van Winsen.
This
element of the issue is not given consideration in the
Commissioner,
South African Revenue Services
v
Hawker Air Services (Pty) Ltd
judgment.
The judgment does not say, though it might imply, that claim in the
case before it could not have been re-instituted once
it was
dismissed. It would seem to me that such a claim cannot be
re-instituted only if dismissal gives rise to the matter being
res
judicata
,
as, for example, where an application for leave to appeal is
dismissed on its merits. In my view the judgment of the Supreme Court

does not intend to overrule what would appear to be an established
line of decisions on the dismissal of claims generally, a line
which
has stood unquestioned for many years.
[9] Be that as it may. Mr
Huisamen
is, in my opinion, correct
in his submission that the statement in
Commissioner,
South African Revenue Services
v
Hawker Air Services (Pty) Ltd
gives
a basis for an argument, which might reasonably be accepted on
appeal, that it was not proper in this case to dismiss the
action
solely for want of proof of urgency. This conclusion would, in the
ordinary course, justify leave to appeal. It is, however,
superfluous
to give leave to appeal on the urgency point, which is procedural, if
there is no reasonable prospect of the appeal
succeeding on its
merits.
The merits
[10] Mr
Huisamen
’s
argument before me is that the 1
st
respondent’s purported payment to the receiver, as set out in a
letter of guarantee issued by a firm known as Business Partners,
was
not a legally valid payment because it was subject to conditions
which had not yet been fulfilled, and that, no other payment
having
been made within the stipulated time, she has failed to perform in
terms of the agreement annexure PAV 2, and her offer
has lapsed. This
argument is supported by the authorities to which he refers and which
state that if the agreement is silent on
the kind or method of
payment, payment must be in cash or by unconditional and irrevocable
guarantee. The argument is correct as
far as it goes. The question is
whether it is applicable to the facts and circumstances of this
agreement.
[11] The agreement specifies by when
payment must be made. It does not specify how it must be made. This,
says Mr
Huisamen,
brings
into play the general principles of the common law which say that
payment means payment in cash. Mr
Dyke
,
for the 1
st
respondent, does not agree. His starting point is the principle in
Esterhuyse
v
Selection Cartage (Pty) Ltd
1965 (1) SA 360
(W) 361D-F,
an authority upon which both parties relied. That judgment lays down
that:
The
relevant principles can be summarised as follows. In contract, where
the debtor is obliged to pay money to the creditor, the
medium of
payment must be that which the contract expressly or impliedly
specifies, as determined by reference to its terms and
such evidence
of custom, usage and the surrounding circumstances as is admissible
to aid in its interpretation. In this regard,
in an ordinary
commercial contract, in the absence of anything signifying the
contrary, only some slight indication in the contract
or evidence
would generally suffice for inferring or implying that payment of the
creditor can be effected by cheque, because that
is now a widely used
and recognised medium of payment in such transactions. In the
absence, however, of such contractual definition
of the medium, the
payment must be made in legal tender. In that case, a tender of
payment by cheque, if objected to by the creditor,
is not valid.
(Williston on Contract, vol. 6 paras. 1810, 1819 note 7; Chitty on
General Principles of Contract, 22nd ed. paras.
1056, 1074, 1087;
Wessels on Contract, 2nd ed. para. 2227; MacKeurtan on Sale, 3rd ed.
p. 215; Schneider & London v Chapman,
1917 T.P.D. 497).
[12] I think that Mr
Dyke
is correct in his
submission that on the acceptable facts (as determined in accordance
with
Plascon-Evans Paints
Ltd
v
Van
Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984 (3) SA 623
(AD) at 634E-635C) the agreement impliedly authorised
and contemplated payment in the form given by the 1
st
respondent, and that neither party contemplated that payment was to
be in cash or its equivalent. On the facts, this is how the
1
st
respondent understood it; how the receiver understood it; and,
indeed, how the applicant himself understood it. In his papers the

applicant annexes a bankers’ letter which guarantees payment of his
offer of R1 400 000-00 and which is also subject to conditions.
This
is the method of payment to be expected in normal commercial usage
applying to this kind of deal, where the parties to the
transaction
do not have millions of rand in cash or its equivalent readily
available. On the facts the conditions imposed by Business
Partners
are the kind of conditions which are ordinarily imposed and
ordinarily met in business practice. They related to the
implementation of matters already agreed to, already arranged, and
easily achieved – the registration of a mortgage bond as security,

the furnishing of a sole suretyship document by the remaining member
of the closed corporation, and the cancellation of the old

suretyships. These are things which could only be done in the future,
when the business is transferred to the purchaser. Conditions
like
these can be evaluated to see whether the payment is conditional in
respects which take it beyond that which is contemplated
by the
parties to a particular agreement. Here, they pass the test. In this
instance nothing further was to be done than the normally
expected
attorney’s work in altering the membership of the closed
corporation, cancelling the applicant’s sureyship and replacing
it
with a sole suretyship by the 1
st
respondent, and registering a new bond
pari
passu
with the transfer of the business. These are the same things which
would have had to be done if the applicant’s offer had been

accepted. On the face of it, therefore, the payment by the 1
st
respondent was payment in terms of the agreement between the parties.
If the officious bystander had asked whether the agreement
intended
payment in cash, everybody involved would have said ‘Of course
not’.
[13] Mr
Dyke
has a second argument. It is that the objection now raised by the
applicant is not an objection initially made by him, either in
his
founding papers or in reply. It is not the case that the 1
st
respondent was called upon to meet. The applicant’s founding
affidavit raised a number of specific respects in which the 1
st
respondent’s payment is alleged to fall short of the requirements
of the agreement. His chief complaint was that her payment
was out of
time. In this, he was patently wrong on the facts and the objection
was not pursued at the hearing. He raised other
points as well –
that payment was for a lesser sum – R900 000-00 – than the R1 700
000-00 offered; that the payment was not
in terms of the agreement
because it imposed additional obligations and onerous burdens on him
which he was not prepared to accept;
and, that the payment was in
contravention of
s 40(a)
of the
Close Corporations Act No 69 of 1984
.
These were answered by the 1
st
respondent, and, where necessary, factual allegations were made in
support of her opposition. They were all rejected in the judgment
as
being without substance, and they have not been raised in the
application for leave to appeal. They are no longer in issue between

the parties. What is now in issue is an objection which was nowhere
raised in the applicant’s papers. Nowhere is there a suggestion
of
the invalidity of the method of payment on the ground that it was not
a cash payment as required by the agreement. Nor was the
point argued
before me at the hearing. An obvious point like this was probably not
taken before because everybody accepted that
on the facts the method
of payment was what both parties contemplated and was in terms of
their agreement. If it were purely a
point of law, there could of
course be no objection to it being taken for the first time on
appeal. But it is not purely a point
of law. It goes to the issue, in
the language of the
Esterhuyse
judgment
supra,
of what the agreement of
the parties expressly or impliedly specified as the method payment,
which must be determined by reference
to its terms and such evidence
of custom, usage and the surrounding circumstances as is admissible
to aid in its interpretation.
The 1
st
respondent was alerted to the other objections to her payment and
reacted,
inter alia,
by
leading evidence. Mr
Dyke
correctly contends that her
opposition would have dealt fully with the argument presently
suggested if it had been raised in the
papers. She is clearly
prejudiced in the conduct of her defence if it is now raised because
she will be denied the opportunity
of dealing with it in evidence.
The applicant must accordingly be confined to the case which he made
out in his papers.
[14] In the result I am of the view
that there are no reasonable prospects of success on the merits. This
is not because the legal
submissions upon which the argument is based
are unsound, but because the legal principles in question do not
apply to the facts
found proved, and the facts found proved cannot be
altered or moulded so that the principles can be applied to them. The
application
for leave to appeal must be dismissed, with costs.
RJW JONES
Judge of the High Court
27 May 2009