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[2012] ZASCA 10
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Barrows v Benning (67/11) [2012] ZASCA 10 (14 March 2012)
THE SUPREME COURT OF APPEAL OF
SOUTH AFRICA
JUDGMENT
Case No: 67/11
No Precedential Significance
In the matter between:
Douglas Edward Barrows
…......................................................................
Appellant
and
Ian David Benning
…..............................................................................
Respondent
Neutral citation:
Barrows v Benning
(67/11)
[2012]
ZASCA 10
(2012)
Coram:
MTHIYANE DP, BRAND, CLOETE, SNYDERS AND MAJIEDT JJA
Heard:
28 February 2012
Delivered: 14 March 2012
Summary:
Jurisdiction – nature of claim
ORDER
On appeal from:
North
Gauteng High Court, Pretoria (Raulinga J sitting as court of first
instance).
1 The amendment is granted.
2 The order made by the court below is set aside.
3 The respondent is to pay the appellant’s costs of the
proceedings
in the court below, including the costs of two counsel where
employed.
4 The respondent is to pay the appellant’s costs of appeal,
including the costs of two counsel where employed.
JUDGMENT
SNYDERS JA (Mthiyane DP, Brand, Cloete and Majiedt JJA concurring):
[1] The North Gauteng High Court, Pretoria, (Raulinga J) was asked,
in terms of Uniform rule 33(4), to determine a preliminary
issue
which arose from the pleadings, namely whether the court had
jurisdiction to entertain the respondent’s claim. It concluded
that it had jurisdiction and consequently dismissed the appellant’s
plea in this regard. It subsequently granted the appellant
leave to
appeal.
[2] No evidence was led before the court below and the matter was
decided on the facts pleaded by the respondent in his particulars
of
claim. During November 2006 and at Irene, Gauteng, within the
jurisdiction of the court below, the respondent, an incola of
the
court, orally agreed with the appellant, a peregrinus of South
Africa, resident in the United Kingdom, for the latter to procure
five per cent of the issued shares in a company incorporated in
Mauritius, and transfer same to the respondent (the share promise
agreement). The respondent issued summons claiming the delivery of
shares, alternatively and in the event of the appellant failing
to
deliver the shares, payment of the value of the shares, estimated at
the time of the summons at the equivalent Rand value of
R64 million.
The respondent served his summons on the appellant whilst the latter
was temporarily in South Africa.
[3] Jurisdiction is the power of a court to
adjudicate upon, determine and dispose of a matter. It is a
territorial power that derives
from the creation of courts of law by
a sovereign authority with power only within the territory of that
sovereign. A court has
jurisdiction when, within its territory, it
has sufficient authority over a defendant to be able to enforce its
orders.
1
Put in different words the court must have the
power not only to take cognisance of a suit, but also to give effect
to its judgment.
2
These rules come from the Roman law, were taken
over by Roman-Dutch law and adopted into our law. Even in the most
recent cases
on jurisdiction this Court applied the doctrine of
effectiveness as a criterion for the existence of jurisdiction.
3
It was therefore not surprising that the argument
foreshadowed in the respondent’s heads of argument that ‘the
focus
on the empty concept of effectiveness’ should be reduced
and that it should be recognised that ‘what in effect happens
is that the court exercises a discretion (once a ratio jurisdictionis
exists or there has been submission, attachment or perhaps
service)
to decline to exercise its jurisdiction on grounds of convenience’,
was not strenuously persisted with. Instead,
the focus during the
hearing was on the nature of the relief claimed and its influence on
the question of jurisdiction.
[4] Counsel for the appellant conceded, rightly so
in view of the decision in
BID
Industrial
referred to in footnote 3
above, that if the respondent only claimed a monetary order of
payment of the value of the shares, the
court below would undoubtedly
have had jurisdiction to determine the matter. On the other hand,
counsel for the respondent conceded,
also rightly so in terms of the
law as it stands, that the court below would not have had
jurisdiction to grant a mandatory interdict
against a peregrinus of
South Africa for the procurement of shares in a foreign company.
However, the parties differed fundamentally
on the identification of
the respondent’s claim as contained in his particulars of
claim.
[5] On behalf of the appellant it was contended
that the respondent seeks a double-barrelled remedy recognised in
Custom Credit Corporation (Pty) Ltd v
Shembe
1972 (3) SA 462
(A) at 470E, a
mandatory interdict and an alternative claim for damages which is
dependant on an election by the respondent to
cancel the share
promise agreement, which is not part of the particulars of claim and
which still has to be made.
4
Thus the jurisdiction a court may have on the
monetary claim once the election is made, the share promise agreement
cancelled and
the value of the shares claimed, would only exist then
and in relation to that claim and could not be applied to the first
remedy,
the interdict.
[6] On behalf of the respondent it was contended that the particulars
of claim does not support the construction of a double-barrelled
remedy, but payment of money as surrogate for specific performance.
The argument was that this construction of the particulars
of claim
is to be favoured because cancellation of the share promise agreement
is not claimed.
[7] The full consequence of the respondent’s construction of
the particulars of claim was not explored, as, before the conclusion
of the argument, an amendment to the particulars of claim was sought.
The effect of the amendment is to remove the claim for delivery
of
shares and confine the claim to one for damages following upon and
flowing from the cancellation of the share promise agreement.
With
the application for an amendment a tender was made for the costs of
and occasioned by the amendment, which are to include
the costs of
the proceedings for the determination of jurisdiction in the court
below and the costs on appeal; and all costs tendered
include the
costs of two counsel where employed. For record purposes I record the
wording of the amendment supplied in handwritten
format:
‘
1 Delete paragraph 15.
2 Replace paragraph 15 with:
“
The plaintiff hereby cancels the share
promise agreement.”
3 Add paragraph 17:
“
The plaintiff suffered damages in the said
amount which flow naturally from the breach.”
4 Delete prayer 1.
5 Delete the word “Alternatively” in prayer 2.
6 Replace “payment” with “Payment” in prayer
2.’
[8] The appellant had no objection to the amendment being granted.
The effect of the amendment is that the reason for the proceedings
in
the court below and on appeal, has fallen away, and the costs order
in the court below has now been countered by a tender for
the same
costs. In order to avoid the conflict between an order of this Court
made on the basis of the respondent’s tender
and the order of
the court below if it is allowed to stand, the order of the court
below is to be set aside.
[9] Consequently the following order is made:
1 The amendment is granted.
2 The order made by the court below is set aside.
3 The respondent is to pay the appellant’s costs of the
proceedings in the court below, including the costs of two counsel
where employed.
4 The respondent is to pay the appellant’s costs of appeal,
including the costs of two counsel where employed.
___________________
S SNYDERS
Judge of Appeal
APPEARANCES:
For the Appellant: P J van Blerk SC
Instructed by:
Brian Kahn
Inc, Johannesburg
Geyser Van
Rooyen Attorneys, Pretoria
Claude
Reid Inc, Bloemfontein
For the
Respondent: P F Louw SC (with him T Dalrymple)
Instructed
by:
Christopher
Lee Attorney, Johannesburg
H W Theron
Inc, Pretoria
Honey
Attorneys, Bloemfontein
1
Schlimmer
v Executrix in Estate of Rising
1904
TH 108
at 111.
2
Steytler
NO v Fitzgerald
1911 AD 295
at 346.
3
Metlika
Trading Ltd & others v Commissioner, South African Revenue
Service
2005 (3) SA 1
(SCA) para 36;
Gallo
Africa Ltd & others v Sting Music (Pty) Ltd & others
2010 (6) SA 329
(SCA) paras 6 and 10 and
BID
Industrial Holdings (Pty) Ltd v Strang & another (Minister of
Justice and Constitutional Development, Third Party)
2008
(3) SA 355
(SCA) paras 24, 39, 41, 55, 56 and 57.
4
The
passage referred to reads: ‘A procedural practice has,
however, grown up in our Courts which permits a plaintiff-seller
to
elect to pursue the first of these rights, i.e., to demand
implementation of the agreement and obtain judgment therefor, but
further permits him in the same action to ask the Court, should the
defendant fail to comply with the Court’s judgment
for
implementation of the agreement, to set aside the agreement and
grant consequential relief. This has been described in the
Courts as
the “double-barrelled” remedy.’