Minshan Africa Holdings (Pty) Ltd v African Skys (Pty) Ltd (1743/2018) [2022] ZAECQBHC 34 (13 September 2022)

78 Reportability

Civil Procedure

Brief Summary

Costs — Postponement of trial — Wasted costs occasioned by postponement due to witness unavailability — Plaintiff's witness unable to attend due to COVID-19 lockdown in China — Plaintiff's request for virtual testimony not acceded to by defendant — Court finds plaintiff's conduct contained an element of blameworthiness for failing to communicate witness's unavailability in a timely manner — General rule that party responsible for postponement must pay wasted costs applies — Plaintiff ordered to pay defendant's wasted costs.

Comprehensive Summary

Summary of Judgment

1. Introduction

The proceedings concerned a costs dispute arising from the postponement of a civil trial, specifically the question of wasted costs occasioned by the postponement. The matter came before the Eastern Cape High Court, Gqeberha, on the civil trial roll before Bands AJ.

The parties were Minshan Africa Holdings (Pty) Ltd as the plaintiff and African Skys (Pty) Ltd as the defendant. The substantive trial was set down on the civil trial roll for Tuesday, 6 September 2022, but the hearing of this interlocutory dispute related only to the postponement and the attendant costs, rather than the merits of the principal claim.

Procedurally, the matter had been placed on the running civil trial roll, and it stood down (with leave of court) to Friday, 9 September 2022 at 14h15 to accommodate both practitioners’ appearances in the Supreme Court of Appeal, consistent with the division’s practice. Shortly before the matter came before the court, the parties agreed to a postponement of the trial; the remaining dispute was whether the wasted costs should be reserved for the trial court or whether an order should immediately be made, and if so, against whom.

The general subject-matter of the dispute was therefore not the underlying cause of action in the main trial, but the allocation of wasted costs in the context of a postponement sought by the plaintiff due to the unavailability of its main witness, who resided in China.

2. Material Facts

The court treated as material the operational context of the civil trial roll in Gqeberha, namely that it is a running roll where a trial, once commenced, continues until finalised. The court also regarded as relevant the division’s practice that when counsel engaged in a High Court civil trial has a clash with a Supreme Court of Appeal appearance, the High Court trial ordinarily stands down until the day after that appearance.

The matter was set down for 6 September 2022 and stood down to 9 September 2022 at 14h15 to accommodate the parties’ counsel who had Supreme Court of Appeal commitments. On Monday, 5 September 2022, the judge was advised that the parties had agreed to postpone, and that the only dispute concerned wasted costs. No further documentation was filed before the hearing, and the court was addressed primarily from the bar.

The plaintiff’s explanation for the postponement was that its main witness, ordinarily resident in Mianyang City, China, could not attend because the area was subject to a COVID-19 lockdown with travel restrictions limiting travel in and out of the city. The plaintiff had attempted to avoid postponement by requesting, via its attorneys on Friday, 2 September 2022, that the witness be permitted to testify via a virtual platform; the defendant did not agree to this. The court noted that it was not asked to determine the mode of hearing, despite being the final arbiter where parties cannot agree.

The plaintiff handed up a “NOTARIAL CERTIFICATE” with an attached Mandarin document (marked Exhibit “A”) to show the lockdown position. The court considered it significant that the certificate certified a Home Quarantine Notice issued on 9 September 2022, being the same day the matter was argued, and that the certificate did not indicate when the lockdown commenced. Counsel for the plaintiff could not provide clarity on the lockdown commencement date, stating only that the plaintiff’s attorneys became aware of the witness’s unavailability on 2 September 2022, alternatively a day or two earlier.

The defendant produced email correspondence showing that on 6 September 2022 it requested a full explanation for the witness’s inability to attend and asked for confirmation that a flight had been booked and for a copy of the visa. On 7 September 2022, the plaintiff’s attorneys replied that they had forwarded the email to their client and awaited the information. Only at 12h41 on 9 September 2022, approximately an hour and a half before argument, did the plaintiff’s attorneys send Exhibit “A” to the defendant, with minimal explanation. The plaintiff did not provide confirmation of a flight booking or a visa; counsel suggested that the witness likely could not obtain these due to restrictions.

The court identified material gaps in the information placed before it. There was no evidence enabling the court to determine the date when the lockdown and travel restrictions were implemented, when it should reasonably have become known that travel would be impossible, why the inability to travel was communicated less than a week before trial, or what steps were taken by the plaintiff to secure the witness’s attendance prior to becoming aware of the restrictions. The court considered it improbable that a prudent litigant would leave international travel arrangements to the weekend before trial; conversely, if restrictions were in place earlier, the court considered the unavailability should have been communicated earlier to mitigate wasted costs or to explore virtual evidence properly and timeously.

3. Legal Issues

The central legal question was how the court should exercise its discretion concerning wasted costs occasioned by a postponement, where the postponement was sought by the plaintiff due to the alleged unavailability of its witness, and where the plaintiff contended that the situation was akin to vis maior and that the matter should have proceeded by virtual testimony.

A further legal issue was whether the costs question should be reserved for determination by the eventual trial court (as sought by the plaintiff) on the basis that the trial court might later conclude, for example, that the defendant’s refusal to permit virtual evidence was unreasonable, or whether the postponement court should make an immediate costs order.

The dispute primarily involved the application of established costs principles to the facts and an exercise of judicial discretion regarding costs. It depended materially on the court’s evaluation of the plaintiff’s explanation and conduct, including whether the postponement was attributable to blameworthy conduct and whether fairness required the defendant to be compensated for being ready to proceed.

4. Court’s Reasoning

The court approached the matter from the premise that, as a general rule, the party whose conduct results in a postponement should bear the wasted costs. The court relied on authority confirming that, in postponement contexts, the party responsible for the matter not proceeding on the allocated date will ordinarily be ordered to pay the wasted costs.

The court evaluated the plaintiff’s attempt to characterise the postponement as arising from circumstances beyond its control (akin to vis maior) and its contention that it was the defendant’s refusal to agree to virtual evidence that led to the postponement. While the court accepted that the plaintiff’s witness was said to be subject to travel restrictions associated with a lockdown, the court placed weight on the insufficiency and timing of the information provided. Exhibit “A” was issued on the day of argument, did not clarify when restrictions commenced, and was provided to the defendant shortly before the hearing. Additionally, the plaintiff did not furnish requested information such as confirmation of flight booking and visa details, and counsel could offer only speculation as to why those could not be provided.

On the evidence before it, the court found itself unable to conclude that the plaintiff’s conduct was free of blameworthiness. The absence of evidence on key timelines and preparatory steps meant the plaintiff did not establish that it had acted prudently and timeously in securing the witness’s attendance or in notifying the defendant and the court of difficulties sufficiently early to mitigate wasted costs.

The court further reasoned that, even if the circumstances were beyond the plaintiff’s control, this did not necessarily justify reserving costs or depriving the defendant of a wasted costs order. Relying on the approach articulated in Westbrook v Genrief Ltd, the court emphasised that litigation entails hazards and that, where one party is ready to proceed and is prejudiced by a postponement, it may still be appropriate for the party seeking the indulgence to pay wasted costs. The court highlighted the defendant’s readiness to proceed and considered it unfair for the defendant to be out of pocket given the late communication of the witness’s unavailability and the late provision of supporting material.

Finally, the court treated the costs decision as a matter within its discretion and exercised that discretion against the plaintiff. The court rejected the plaintiff’s request to reserve costs to the trial court, reasoning that there was no sufficient basis—on the information presented—to postpone the costs determination or to leave the defendant uncompensated for the wasted trial allocation.

5. Outcome and Relief

The court ordered that the trial be postponed sine die.

The court further ordered that the plaintiff pay the defendant’s wasted costs occasioned by the postponement. No alternative costs arrangement was made, and the costs issue was not reserved for the trial court.

Cases Cited

Ferreira v Levin N.O.; Vryenhoek v Powell N.O. [1996] ZACC 27; 1996 (2) SA 621 (CC); 1996 (4) BCLR 441 (CC).

Abbott v Von Theleman 1997 (2) SA 848 (C).

Mahlangu v De Jager 1996 (3) SA 235 (LCC).

Sublime Technologies (Pty) Ltd v Jonker and Another 2010 (2) SA 522 (SCA).

Westbrook v Genrief Ltd 1997 (4) SA 218 (D & CLD).

Davey v Davey (191/2019) [2019] ZAECPEHC 44 (2 July 2019).

Legislation Cited

No legislation was cited as determinative in the judgment.

Rules of Court Cited

Rule 5 of the Joint Rule of Practice for the High Courts of the Eastern Cape Province.

Held

The court held that the matter should be postponed, but that the plaintiff—having sought the postponement due to its witness’s unavailability and having failed to place sufficient, timeous information before the court to demonstrate an absence of blameworthiness—should bear the wasted costs occasioned by the postponement.

The court further held that, even if the precipitating circumstances were beyond the plaintiff’s control, the defendant should not be left out of pocket where it was ready to proceed and the postponement was communicated with insufficient timeous clarity. The court therefore declined to reserve the costs for determination by the trial court and made an immediate costs order against the plaintiff.

LEGAL PRINCIPLES

The judgment applied the principle that wasted costs occasioned by a postponement are ordinarily borne by the party responsible for the matter not proceeding on the allocated date, and that the court retains a discretion to determine an appropriate costs order in the circumstances.

It further applied the principle that even where a postponement arises from circumstances arguably beyond a litigant’s control, a court may still order the party seeking the indulgence to pay wasted costs, particularly where the opposing party was ready to proceed and would otherwise suffer prejudice. The decision emphasised that the allocation of costs in postponement situations is not mechanically deferred to the trial court, but is instead determined by an evaluative exercise grounded in fairness, preparedness, and the adequacy and timing of the explanation for the postponement.