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[2020] ZAECPEHC 33
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Standard Bank of South Africa Limited and Another v Five Strand Media (Pty) Ltd and Others (745/2020) [2020] ZAECPEHC 33 (7 September 2020)
IN
THE HIGH COURT OF SOUTH AFRICA
EASTERN
CAPE LOCAL DIVISION, PORT ELIZABETH
Case No.: 745/2020
Date Heard: 18 August
2020
Made available: 7
September 2020
In
the matter between:
STANDARD
BANK OF SOUTH AFRICA LIMITED
First Plaintifff
SG
GUARANTEE COMPANY (RF) (PTY) LTD
Second Plaintiff
and
FIVE
STRAND MEDIA (PTY) LTD
First
Defendant
MOEGAMMAT
SHAAF ANDREWS
Second Defendant
RAFIEK
POTGIETER
Third Defendant
REASONS
RONAASEN
AJ:
Introduction
[1]
The particulars of claim in terms of which the plaintiffs instituted
action against the
defendants consist of 19 claims.
[2]
The first plaintiff claimed in terms of claims 1 to 17 (claims 1 to 9
being against the
first defendant, claims 10 to 13 being against the
second defendant and claims 14 to 17 being against the third
defendant) and
the second plaintiff in respect of claims 18 and 19
(claim 18 being against the second defendant and claim 19 being
against the
third defendant).
[3]
The action was defended by the defendants and subsequent to the
delivery of their plea the
plaintiffs applied for summary judgment
against the defendants in respect of all claims save for claim 1.
The application
for summary judgment, in turn, was opposed by the
defendants.
[4]
On Tuesday, 18 August 2020, after hearing argument from the parties,
whose contentions were
supported by written heads of argument, I gave
an order for summary judgment against the defendants in the following
terms:
“
PART
A: IN FAVOUR OF FIRST PLAINTIFF AGAINST THE FIRST DEFENDANT:
1.
CLAIM 2: THE INSTALMENT SALE AGREEMENT ACCOUNT
NO
6120906660002
1.1.
An order for the delivery of one 2011 HYUNDAI H-1 GLS 2.4 CVVT WAGON
(engine number
G4KGAA594857 and vehicle identification number
KMHWH81RLBU314293);
1.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way
of subsequent action;
1.3.
Costs of the suit as between attorney and client.
2.
CLAIM 3: THE INSTALMENT SALE AGREEMENT ACCOUNT NO 6120906660003
2.1.
An order for the delivery of one 2015 BMW M4 COUPE A/T (engine number
006629195 and
vehicle identification number
WBS3R92040K342374);
2.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way
of subsequent action;
2.3.
Costs of the suit as between attorney and client;
3.
CLAIM 4 : THE INSTALMENT SALE AGREEMENT ACCOUNT NO
6120906660004
3.1.
An order for the delivery of 2015 BMW M4 COUPE M-DCT (engine number
0659092 and vehicle
identification number
WBS3R92040K341502);
3.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way
of subsequent action;
3.3.
Costs of the suit as between attorney and client;
4.
CLAIM 5: THE INSTALMENT SALE AGREEMENT ACCOUNT NO 6120906660005
4.1.
An order for the delivery of 2015 BMW M4 COUPE M-DCT 2015 BMW M4
COUPE (engine number
07639266 and vehicle identification number
WBS3R92070K342823);
4.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way
of subsequent action;
4.3.
Costs of the suit as between attorney and client
5.
CLAIM 6: THE INSTALMENT SALE AGREEMENT ACCOUNT NO 6120906660006
5.1.
An order for the delivery of one 2016 MERCEDES BENZ B200D AMG
A/T (engine number
65193033164370 and vehicle identification number
WDD2462082J378249);
5.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way
of subsequent action;
5.3.
Costs of the suit as between attorney and client
6.
CLAIM 7: THE INSTALMENT SALE AGREEMENT ACCOUNT NO 6120906660007
6.1.
An order for the delivery of one 2015 BMW 320 I SEDAN A/T
(engine number A4981018
and vehicle identification number
WBA3B16020NS61277);
6.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way
of subsequent action;
6.3.
Costs of the suit as between attorney and client.
7.
CLAIM 8: THE BUSINESS REVOLVING CREDIT PLAN ACCOUNT WITH
REFERENCE NO 302968075
7.1.
Payment of the sum R 212 199.75;
7.2.
Payment of interest on the aforesaid sum at the variable rate of
16.35 per cent per
annum (prime plus 6.6 per cent) calculated daily
and compounded monthly in arrears from 25 January 2020 to date of
payment, both
days inclusive;
7.3.
Costs of the suit as between attorney and client.
8.
CLAIM 9: THE BUSINESS OVERDRAFT WITH ACCOUNT NO 032743106
8.1.
Payment of the sum
of R 3 433 480.04
,
jointly and severally with the Second and Third Defendant, the one
paying the other to be absolved;
8.2.
Payment of interest on the aforesaid sum
at a rate
of interest 5.5% above prime
per annum
calculated daily and compounded monthly in arrears from 25 January
2020 to date
of payment, both days inclusive;
8.3.
Costs of the suit as between attorney and client.
PART
B: IN FAVOUR OF THE FIRST PLAINTIFF AGAINST THE SECOND DEFENDANT:
9.
CLAIM 10: THE INSTALMENT SALE AGREEMENT ACCOUNT NO 61209678
0001
9.1.
An order for the delivery of one 2015 BMW 320 I SEDAN A/2012
LAND ROVER EVOQUE
2.2 SD4 DYNAMIC (engine number DZ78040228790224DT
and vehicle identification number SALVA2AD7CH686651);
9.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way
of subsequent action;
9.3.
Costs of the suit as between attorney and client.
10.
CLAIM 11: MASTER CARD ACCOUNT REFERENCE NO 5520578034036165
10.1.
Payment of the sum R 20 380.99 ;
10.2.
Payment of interest on the aforesaid sum at the variable rate of
18.15 % per annum calculated
daily and compounded monthly in arrears
from 25 January 2020 to date of payment, both days
inclusive;
10.3.
Costs of the suit as between attorney and client.
11.
CLAIM 12: THE GUARANTEE
EXECUTED BY THE SECOND DEFENDANT FOR THE INDEBTEDNESS OF THE FIRST
DEFENDANT
11.1.
Payment of the sum
of R 3 433 480.04
,
jointly and severally with the First and Third Defendant, the one
paying the other to be absolved
(in terms of prayer 9
above);
11.2.
Payment of interest on the aforesaid sum
at a rate
of interest 5.5% above prime
per annum
calculated daily and compounded monthly in arrears from 25 January
2020 to date
of payment, both days inclusive;
11.3.
Costs of the suit as between attorney and client.
12.
CLAIM 13: THE CURRENT ACCOUNT NO
372962572
12.1.
Payment of the sum of R 7 290.16 ;
12.2.
Payment of interest on the aforesaid sum at the variable rate of
20.25 % per annum calculated
daily and compounded monthly in arrears
from 25 January 2020 to date of payment, both days
inclusive;
12.3.
Costs of the suit as between attorney and client.
PART
C: IN FAVOUR OF THE FIRST PLAINTIFF AGAINST THE SECOND DEFENDANT:
13.
CLAIM 14: THE INSTALMENT SALE AGREEMENT ACCOUNT NO 61209694
0001
13.1.
An order for the delivery of one 2011 LAND ROVER EVOQUE 2.0 SI4
DYNAMIC (engine number
230811211243204PT and vehicle identification
number SALVA2AG1CH617156);
13.2.
An order that the First Plaintiff be granted leave to prove damages
(if any) by way of subsequent
action;
13.3.
Costs of the suit as between attorney and client.
14.
CLAIM 15: MASTER CARD ACCOUNT REFERENCE NO 5520578032020336
14.1.
Payment of the sum of R 20 380.99;
14.2.
Payment of interest on the aforesaid sum at the variable rate of at
the variable rate of 7.25
% per annum calculated daily and compounded
monthly in arrears from 25 January 2020 to date of payment;
14.3.
Costs of the suit as between attorney and client.
15.
CLAIM 16: THE GUARANTEE EXECUTED BY THE THIRD DEFENDANT FOR THE
INDEBTEDNESS OF THE FIRST DEFENDANT
15.1.
Payment of the sum of
R 3 433 480.04
,
jointly and severally with the First and Third Defendant, the one
paying the other to be absolved
(in terms of prayer 9
above);
15.2.
Payment of interest on the aforesaid sum
at a rate
of interest 5.5 % above prime
per annum
calculated daily and compounded monthly in arrears from 25 January
2020 to date
of payment, both days inclusive;
15.3.
Costs of the suit as between attorney and client.
16.
CLAIM 17: THE CURRENT ACCOUNT NO
080365620
16.1.
Payment of the sum
of
R 1 802.29;
16.2.
An order for payment of interest on the aforesaid sum at the variable
rate of 20.25 % per annum
calculated daily and compounded monthly in
arrears from 25 January 2020 to date of payment, both days
inclusive;
16.3.
Costs of the suit as between attorney and client.
PART
D: IN FAVOUR OF THE SECOND PLAINTIFF AGAINST THE FIRST
DEFENDANT:
17.
CLAIM 18:
THE LOAN AGREEMENT: 531383156
17.1.
Payment of the sum of R 2 341 201.17;
17.2.
Payment of interest on the aforesaid sum at the rate of 11.22 % per
annum from 31 JANUARY 2020
to date of payment, both dates
inclusive;
17.3.
Costs of the suit as between attorney and client.
PART
E: IN FAVOUR OF THE SECOND PLAINTIFF AGAINST THE SECOND DEFENDANT:
18.
CLAIM 19:
THE LOAN AGREEMENT: 531383156
18.1.
Payment of the sum of R 2 369 187.58;
18.2.
Payment of interest on the aforesaid sum at the rate of 10.35 %
per annum from 31 JANUARY
2020 to date of payment;
18.3.
Costs of the suit as between attorney and client.”
[5]
The reasons for my order follow, below.
Legal
principles
[6]
On 1 July 2019 material amendments to Uniform Rule 32 came into
operation, to which I shall
refer in more detail later. Some of
the well-known and established requirements which have to be
satisfied by a plaintiff
to succeed in obtaining summary judgment or
by a defendant to avoid summary judgment remain unaltered.
Those requirements
have been dealt with exhaustively by our courts.
They have been accurately dealt with by the parties in their
heads
of argument and do not require further discussion.
[7]
In
Raumix Aggregates (Pty) Ltd v Richter Sand CC
2020 (1) SA
623
(GJ) at [16] the purpose of rule 32 was described in the
following terms:
“
The
purpose of a summary judgment application is to allow the court to
summarily dispense with actions that ought not to proceed
to trial
because they do not raise a genuine triable issue, thereby conserving
scarce judicial resources and improving access to
justice. Once
an application for summary judgment is brought, the applicant obtains
a substantive right for that application
to be heard, and, bearing in
mind the purpose of summary judgment, that hearing should be as soon
as possible. That right
is protected under section 34 of the
Constitution.”
[8]
In terms of rule 32 in its amended form:
8.1.
the plaintiff may only apply for summary judgment after the defendant
has delivered a plea - sub-rule (1);
8.2.
the plaintiff must, in the affidavit in support of the application
for summary judgment, verify the cause of action and the amount, if
any, claimed, and identify any point of law relied upon and
the facts
upon which the plaintiff’s claim is based, and explain briefly
why the defence as pleaded does not raise any issue
for trial -
sub-rule (2)(b);
8.3.
the defendant may, in order to avoid summary judgment, give security
to the satisfaction of the court, and no longer to the satisfaction
of the registrar, for any judgment including costs which may
be given
- sub- rule (3)(a);
8.4.
alternatively, the defendant may satisfy the court by affidavit
(which shall be delivered five days before the day on which the
application is to be heard), or, with the leave of the court, by
the
oral evidence of such defendant, or of any other person who can swear
positively to the facts that the defendant has a
bona fide
defence to the action, which affidavit or evidence must disclose
fully the nature and grounds of the defence and the material facts
relied upon for such defence - sub-rule (3)(b).
[9]
The new requirement in rule 32(2)(b) in terms of which a plaintiff in
an application for
summary judgment must identify any point of law
relied upon, refers to a point of law in relation to the plaintiff’s
claim
on which summary judgment is sought and does not relate to the
defence as pleaded by the defendant. In
Absa Bank Ltd v
Mpahlele and Others
[2020] ZAGPPHC 257 (26 March 2020) at [18] it
was held that the identification requirement does not include the
identification
of evidence in support of the point of law concerned.
[10]
The third requirement in rule 32(2)(b) is that the plaintiff in the
application for summary judgment must
identify the facts upon which
its claim is based. This seems to require a repetition in the
affidavit supporting the application
for summary judgment of the
facts upon which the claim is based as identified in the particulars
of claim or, at least, a cross-reference
to these facts. It is
not, however, required of a plaintiff to amplify the cause of action
as set out in the particulars
of claim, given that the particulars of
claim must comply with the rules and in particular with rules such as
rule 18(3) and 18(6).
[11]
With regard to the requirement in rule 32(2)(b) obliging the
applicant for summary judgment to furnish a
brief explanation as to
why the defence as pleaded does not raise any issue for trial the
following was appositely stated in
Tumileng Trading CC v National
Security and Fire (Pty) Ltd; E and D Security Systems CC v National
Security and Fire (Pty) Ltd
[2020] ZAWCHC 28
(30 April 2020):
“
[21]…
I consider that the amended rule 32(2)(b) makes sense only if the
word ‘genuinely’is a read in before the
word ‘raise’
so that the pertinent phrase reads ‘explain briefly why the
defence as pleaded does not genuinely
raise any issue for trial’.
In other words, the plaintiff is not required to explain that the
plea is excipiable. It
is required to explain why it is
contended that the pleaded defence is a sham.
[22]
What the amended rule does seem to do is to require of a plaintiff to
consider very carefully its ability to allege a belief
that the
defendant does not have a bona fide defence. This is because
the plaintiff’s supporting affidavit now falls
to be made in
the context of the deponent’s knowledge of the content of a
delivered plea. That provides a plausible
reason for the
requirement of something more than a ‘formulaic’
supporting affidavit from the plaintiff. The
plaintiff is now
required to engage with the content of the plea in order to
substantiate its averments in the defence is not bona
fide and has
been raised merely for the purposes of delay.”
[12]
Rule 32(3)(b) has been left substantively unchanged and a defendant’s
affidavit filed in opposition
to an application for summary judgment
must still show that the defendant has a
bona fide
defence to
the action and must disclose fully the nature and grounds of the
defence ann the material facts relied upon for such
defence.
Obviously, to satisfy these requirements a defendant will have to
engage meaningfully with the additional material
now required to be
contained in a plaintiff’s affidavit supporting summary
judgment.
[13]
In
Tumileng
at [40] it was emphasised that the brief
explanation required from a plaintiff in its affidavit supporting its
application for
summary judgment as to why the defence as pleaded
does not raise any issue for trial, relates directly to the
requirement in rule
32(3)(b) that a defendant must disclose a
bona
fide
defence to the action in the affidavit opposing summary
judgment. The plaintiff now has the opportunity to amplify the
previously
formulaic averment that the defendant does not have a
bona
fide
defence to the action.
[14]
The essential requirement in summary judgment proceedings, thus,
remains the same namely whether or not a
defendant, be it in the plea
or the affidavit opposing summary judgment has demonstrated the
existence of a
bona fide
defence to the action by disclosing
fully the nature and grounds of the defence and the material facts
relied upon for the defence.
Application
of principles
The
plaintiffs’ affidavit in support of summary judgment
[15]
The plaintiffs’ affidavit in support of their application for
summary judgment complies with the provisions
of rule 32 in its
current form. In the affidavit the plaintiffs have cogently
dealt with the various claims and in respect
of all the claims have
identified why the “defence” as pleaded by the defendants
does not raise any issue for trial.
That much will be apparent
from my analysis of the plea and the affidavit opposing summary
judgment.
The
plea
[16]
In respect of each of the claims which are the subject matter of the
application for summary judgment the
defendants have admitted:
16.1.
their breaches of the underlying contracts;
16.2.
having been notified of the plaintiffs’ election to cancel the
instalment
sale contracts;
16.3.
alternatively, the election to enforce payment under the contracts;
and
16.4.
in respect of claims where this would be applicable, the right
to claim the
delivery of specified movable property by reason of the
cancellation of the contracts concerned.
[17]
The plea in respect of the sum of R400 000.00 paid as a
“deposit” for the payment of arrear
vehicle instalments
is irrelevant given the defendants’ admission of the breaches,
arrears and entitlement to cancel in respect
of the instalment sale
agreements.
[18]
The defendants’ “defence” in respect of claims 2,
3, 4, 5, 6, 7, 10 and 14 namely that
they had made settlement
proposals to the first plaintiff respect of the indebtedness in each
instance is not a defence at all
given their admitted breaches of the
underlying contracts. A settlement proposal to compromise an
admitted indebtedness is
not a defence to the claim underlying such
indebtedness. It is rather an admission of such indebtedness.
Furthermore, the
defendants confirm that their proposals in respect
of claims 3, 4, 5, 6, 10 and 14 were rejected.
[19]
The defendants, in any event, have failed to set out what the
proposed terms of the settlement would
be, whether the proposals were
made conditionally or unconditionally and have not alleged that the
first plaintiff accepted any
of the settlement proposals.
[20]
The apparent “alternative” defence to claims 3, 4, 5, 6,
7, 10 and 14 that they had notified
the first plaintiff that they
would be in a position to remedy the breach of the underlying
contracts by 1 August 2020 is, again,
an admission of liability and
cannot constitute a defence to the underlying claims.
[21]
By parity of reasoning the only “defence” raised to
claims 8, 9, 11, 12, 13, 15, 16, 18 and 19
that, sometime in the
future, the defendants would be in a position to remedy their
admitted breaches of the underlying contracts
cannot constitute a
defence on the merits of the respective claims.
[22]
The third defendant’s reliance on the benefit of excussion to
escape liability under claim 16 is spurious.
First, he
expressly renounced any reliance on such benefit and, second, in any
event, at law the guarantee to which he bound himself
is a principal
obligation and not an accessory one and therefore does not carry with
it the benefit of excussion in favour of the
guarantor.
List
v Jungers
1979 (3) SA 106
(A) at 119D-G.
[23]
Claim 17 received no mention in the plea and accordingly no defence
is raised in respect of this claim.
The
defendants’ affidavit resisting summary judgment
[24]
The significant general feature of the defendants’ poorly
drafted and almost incoherent affidavit resisting
summary judgment is
that it makes no particular reference to the plea or any attempt to
incorporate the terms of the plea, other
than a throwaway paragraph
referring to the alleged payment of the sum of R400 000.00.
It makes no effort to come to
grips with the admissions of liability
in the plea and why, despite these admissions there are defences to
the claims.
[25]
The affidavit alludes to the vague possibility of a claim in
reconvention which would be available to the
first defendant due to
the alleged untimely withdrawal of the defendants’ banking
facilities by the first plaintiff in December
2019. No
particularity is furnished as to the possible claim in reconvention
or the legal basis on which such claim would
exist given that the
majority of the breaches relied upon by the plaintiffs occurred prior
to December 2019. The claim would be
one for damanges and is not
quantified at all.
[26]
No explanation is offered why this new “defence” did not
feature in the plea or why it was not
ventilated in a claim in
reconvention, filed contemporaneously with the plea.
Further
new “defence” raised in argument
[27]
In argument before me the defendants attempted to raise a new defence
which had hitherto not featured in
the plea or affidavit resisting
summary judgment, namely that credit had been advanced to them
recklessly by the plaintiffs, as
envisaged in the
National Credit
Act, 34 of 2005
. Counsel for the defendants was thus
constrained to concede that no basis existed for him to advance this
as a ground for
defence.
[28]
Counsel for the defendants also, quite correctly, conceded that
neither the plea nor the affidavit resisting
summary judgment had
disclosed a
bona fide
defence to the action.
Conclusion
[29]
In the light of my analysis of the plea and the affidavit resisting
summary judgment I am satisfied that
the defendants have not
disclosed in those documents a
bona fide
defence to the
action. They have not in those documents disclosed the nature
and grounds of their alleged defence or any
material facts from which
a
bona fide
defence to the action can be discerned. No
basis therefore exists for me to exercise my discretion to refuse
summary judgment.
[30]
For these reasons I granted summary judgment in favour of the
plaintiffs in the terms set out in paragraph
[4] above.
O
H RONAASEN
ACTING
JUDGE OF THE HIGH COURT
Appearances:
For
Plaintiffs:
Adv J Nepgen instructed by Pagdens Attorneys, Port Elizabeth
For
Defendants: Adv J Thysse
instructed by Meldrum Attorneys, Port Elizabeth