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[2021] ZAKZDHC 32
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Nedbank Limited v Bravo Petroleum and Another (D1108/2020) [2021] ZAKZDHC 32 (15 September 2021)
SAFLII
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IN THE HIGH COURT OF
SOUTH AFRICA
KWAZULU-NATAL LOCAL
DIVISION, DURBAN
CASE
NO: D1108/2020
In
the matter between:
NEDBANK
LIMITED PLAINTIFF
and
BRAVO
PETROLEUM FIRST
DEFENDANT
ADIEL
HENDRICKS SECOND
DEFENDANT
ORDER
Judgment
is granted in favour of the plaintiff against the first and second
defendants, jointly and severally, the one paying the
other to be
absolved, for the following:
(a) Payment
of the amount of R893 144.15;
(b) Interest
on the said sum at the rate of 9.75% from 28 January 2020 to date of
final payment;
(c) Costs
of suit on an attorney client scale, including such costs occasioned
by the adjournment on 24 August
2021.
JUDGMENT
Chetty
J
[1] This
matter came before me on the expedited trial roll after an
application for summary judgement had been
refused in respect of an
action in which the plaintiff sued for the amount of R1 967 481.77
arising from the breach by the first
defendant of the terms and
conditions of a transactional current account (No. […]) it had
with the plaintiff in its capacity
as a banking institution. The
contention of the plaintiff, as pleaded in the particulars of claim
and amplified in the affidavit
in support of summary judgement, is
that the first defendant concluded six instalment sale agreements and
two operating rental
agreements with the plaintiff. This is not
disputed by the first defendant. It is the failure of the first
defendant to honour
the debit orders against the current account that
forms the subject of the litigation.
[2] The
current account, which was opened in the name of the first defendant
in June 2019, was operated with an
overdraft facility of R1 million
authorised by the plaintiff. The plaintiff alleges that as at 1
February 2020 the account was
overdrawn by an amount of R1 082
553.22. The basis for the account exceeding the limit imposed by the
plaintiff arises from a series
of transactions in which the plaintiff
passed debit orders against the current account in respect of the
instalment sale agreements
and the two rental agreements in
accordance with the written instructions of the first defendant. As a
result of these debit orders
not being honoured, the plaintiff gave
notice to the first defendant to remedy its breach. As a result of a
failure to rectify
the excess on the overdraft facility and its
failure to conduct its account in an acceptable manner, the plaintiff
alleges that
the first defendant breached the terms and conditions of
the transactional current account resulting in the plaintiff claiming
the immediate repayment of all amounts under the agreements.
[3] The
terms and conditions of the transactional current account and the
overdraft facility were agreed to by
the first and second defendants,
with the second defendant representing the first defendant at all
material times. Included in
the terms and conditions is the first
defendant’s acceptance that it would be in default in the event
of it failing to conduct
the account in a manner acceptable to the
plaintiff, as well as failing to rectify an excess on the account, on
demand. The terms
and conditions of the account were expressly set
out in the plaintiff’s particulars of claim and were admitted
by the defendants
in their plea. In respect of the second defendant,
it was not disputed in his plea that he signed a suretyship agreement
binding
himself for the indebtedness of the first defendant.
[4] The
defendants opposed the claim essentially contending that the
plaintiff mismanaged its current account in
processing or authorising
the debit orders relating to the instalment sale agreements at the
time when it did, resulting in the
account exceeding the overdraft
limit. The defendants also place in dispute the certificate of
balance on which the plaintiff relies
in respect of the amount due
and payable.
[5] In
light of the issues being clearly defined for determination, an order
was granted on 7 May 2021 referring
the matter to the expedited trial
roll. On 23 August 2021 counsel who appeared for the defendants
informed the court that he was
unwell and was not in a position to
proceed with the trial. Upon enquiry I was further advised that the
defendants’ attorney
was also not present in court as he was
engaged in a matter in Newcastle. The application for an adjournment
was opposed by the
plaintiff’s counsel who pointed out that the
plaintiff was ready to proceed and had secured the attendance of two
witnesses
from its head office in Johannesburg.
[6] In
light of the concern regarding the health of the defendants’
counsel, who indicated that he had already
secured an urgent
appointment with a doctor, I acceded to the request for an
adjournment. However, as the plaintiff was clearly
prejudiced by the
matter being delayed, I directed that the defendants be liable for
the wasted costs on an attorney-client scale,
including those
pertaining to the accommodation of the witnesses whose attendance had
been secured by the plaintiff. I requested
that the defendants’
counsel furnish the court with a medical certificate indicating the
nature of the illness or its severity.
I further requested the
details of the matter in which the defendants’ attorney was
engaged in at Newcastle, including the
case number and the magistrate
presiding in the matter.
[7] It
has regrettably become common practice in this division that counsel
appear without an instructing attorney
in attendance. This is
certainly a departure from the traditional practice, requiring the
instructing attorney to be in attendance
throughout. In any event
having granted the adjournment, I cautioned the second defendant, who
was present court, that the matter
would proceed on 24 August 2021
and that he was obliged to ensure that he was legally represented,
failing which he would have
to appear in person and conduct his
defence.
[8] When
the matter was called on 24 August 2021, neither the defendants’
attorney nor counsel was present.
Instead the second defendant
informed the court that his counsel was ill and his attorney was
engaged in a three-day matter in
Newcastle. On that ground, the
second defendant requested that the matter be adjourned to enable him
to obtain legal representation.
This application was opposed by the
plaintiff, whose counsel indicated that the matter was placed on the
expedited trial roll on
the basis that it was capable of being
resolved speedily, and that the plaintiff would be further prejudiced
should the matter
be adjourned once more. The approach as to the
factors to be taken into account in determining whether a
postponement should be
granted were reiterated in
Magistrate
Pangarker v Botha and Another
2015 (1) SA 503
(SCA), paras 24-27,
where the court referred to the following authorities on the subject:
‘
[24] Van Zyl J in
Thirion
said:
[1]
“
Of course no court
would feel the urge to come to the assistance of a litigant who has
been the author of his own misfortune and
has suffered injustice by
his own conduct. Cognisance must, therefore, be taken of all the
relevant facts and circumstances giving
rise to such misfortune and
injustice. If he has been careless, dilatory or in bad faith (
mala
fide
), he cannot expect the courts to come to his assistance.”
[25]
The
legal principles governing the grant and refusal of postponements are
well established. In
Carephone
(Pty) Ltd
v
Marcus
NO and Others
,
[2]
Froneman DJP held:
‘
In a court of law
the granting of an application for postponement is not a matter of
right. It is an indulgence granted by the court
to a litigant in the
exercise of a judicial discretion. What is normally required is a
reasonable explanation for the need to postpone
and the capability of
an appropriate costs order to nullify the opposing party’s
prejudice or potential prejudice.’
[26]
In
Take and
Save Trading CC
v
Standard
Bank of SA Ltd
,
[3]
Harms JA said:
‘
One of the oldest
tricks in the book is the practice of some legal practitioners,
whenever the shoe pinches, to withdraw from the
case (and more often
than not to reappear at a later stage), or of clients to terminate
the mandate (more often than not at the
suggestion of the
practitioner), to force the court to grant a postponement because the
party is then unrepresented. Judicial officers
have a duty to the
court system, their colleagues, the public and the parties to ensure
that this abuse is curbed by, in suitable
cases, refusing a
postponement. Mere withdrawal by a practitioner or the mere
termination of a mandate does not, contrary to popular
belief,
entitle a party to a postponement as of right.’
[27]
The
Constitutional Court held in
Lekolwane
and another v Minister of Justice and Constitutional Development
:
[4]
‘
The postponement
of a matter set down for hearing on a particular date cannot be
claimed as a right. An applicant for a postponement
seeks an
indulgence from the court. A postponement will not be granted, unless
this Court is satisfied that it is in the interests
of justice to do
so. In this respect the applicant must ordinarily show that there is
good cause for the postponement. Whether
a postponement will be
granted is therefore in the discretion of the court. In exercising
that discretion, this Court takes into
account a number of factors,
including (but not limited to) whether the application has been
timeously made, whether the explanation
given by the applicant for
postponement is full and satisfactory, whether there is prejudice to
any of the parties, whether the
application is opposed and the
broader public interest.’
[9] In
considering an application for a postponement, the court is required
to take into account the interests
of both parties in determining
whether the matter should be postponed. In this regard I took into
account that the matter had already
been postponed on the first day
when it was scheduled for trial. In granting the postponement, I
specifically brought to the attention
of the second defendant, who
was present in court, that should his attorney or counsel not be
available, the matter would nonetheless
proceed in their absence. As
such, it was incumbent on the second defendant to have secured legal
representation. He did not and
accordingly must accept responsibility
the consequences of that decision.
[10] In
the result, the application for a postponement was refused and the
second defendant was thereafter advised
of his rights to participate
in the trial, to put questions to witnesses and to remain in
attendance to give evidence. Mr Hendricks,
the second defendant, was
present at court and informed me that he was at a disadvantage as he
was not suitably trained to address
the court, and that he would
ultimately prejudice his rights by participating in the trial. He was
advised of his right to cross-examine
any of the witnesses called by
the plaintiff and to testify in support of his defence. He elected to
do neither. I refused a request
for a further adjournment and the
matter proceeded on the basis of the plaintiff’s witnesses
testifying without any cross-examination.
[11]
The
first witness for the plaintiff was Mr Marius Kuger, a regional
manager in the plaintiff’s ‘recoveries team’,
which
I assume deals with outstanding debts owing to the bank. He testified
that as at 2 February 2021 the total outstanding balance
due to the
plaintiff was the amount of R893 144,15.
[5]
He confirmed that this is consistent with the certificate of balance
which is annexed to the application to place the matter on
the
expedited trial roll, which document has been signed by the witness.
The second defendant was afforded the opportunity of cross-examining
the witness. He declined to do so on the basis that it would
potentially prejudice his rights.
[12] The
second witness for the plaintiff was Ms Rodrigues, who is the
national head of Credit Risk (Retail Relationship
Banking) and based
at the plaintiff’s head office in Sandown. With reference to
the statement of the first defendant’s
bank account as at 1
February 2020, and which was annexed as ‘POC4’ to the
particulars of claim, the witness testified
that this document
related to the first defendant’s current account statement for
the period 31 December 2019 to 1 February
2020. It was apparent from
the document that the overdraft limit granted to the first defendant
on the account was R1 million.
The statement of account further
reflects that the account was overdrawn by an amount of R1 082
553,22. In other words, according
to the witness, the account was
overdrawn by the total amount of R2 082 553.22. She went on to
explain that as a result of certain
debit orders processed against
the account on 7 January 2020, the balance of the account increased
from R871,375.20 to R1 938 820.27.
These debit orders pertained to
instalment sale agreements concluded with the plaintiff in terms of
which the plaintiff had financed
the purchase of certain vehicles and
equipment for the first defendant, as well as two rental agreements.
According to Ms Rodrigues
the current account had been similarly
debited since its inception in 2019 and on that basis, it must be
inferred, that the transactions
authorised on 7 January 2020 were not
the first to be debited against the first defendant’s account.
[13]
With
regard to the contention advanced by the first defendant that the
cause of the alleged breach on the transactional account
was as a
result of the plaintiff’s repetitive conduct in debiting the
first defendant’s current account with the various
payments
pertaining to the instalment sale agreements, Ms Rodrigues testified
that the first defendant had entered into various
contracts and
signed a debit order authorisation, which permitted the plaintiff to
debit the first defendant’s current account
on the seventh day
of each month, or on a date as agreed between the parties. In this
regard the witness referred to a copy of
the instalment sale
agreement which was attached to the affidavit in support of summary
judgement.
[6]
The agreement is
between the plaintiff and the first defendant, represented by the
second defendant, who signed the agreement.
The agreement
specifically provides for a debit order authorisation, with the first
instalment payable on 7 October 2019, and subsequent
instalments on
each succeeding instalment date being claimable by the plaintiff on
the basis that the first defendant would ensure
that funds would be
available in its account for the account to be debited. The agreement
further provides that in the event of
a payment not being made, for
whatever reason, the first defendant would have no claim against the
bank and further absolves the
plaintiff from any responsibility or
liability in that regard. The debit order authorisation was signed by
the second defendant
on 17 September 2019.
[14] The
witness further testified that a similar debit order authorisation
had been signed by the second defendant
in respect of each instalment
sale contract entered into between the plaintiff and the first
defendant. In relation to the transactional
current account of the
first defendant, prior to the debit orders being processed, the
account was being operated within the limits
of the overdraft
afforded to the first defendant. As set out earlier, as a result of
the debit orders being processed, the overdraft
limit was exceeded by
R938 820.27 in light of there being insufficient funds in the account
to cater for the debit orders. Ms Rodrigues
denied that the plaintiff
was in anyway responsible for the account falling into excess on the
basis that the first defendant specifically
authorised a deduction
against the current account, on the due dates, in respect of the
instalment sale agreements.
[15] Ms
Rodrigues testified that upon the debit orders being processed and
the account exceeding the overdraft
limit, the plaintiff’s
business relationship manager would then contact the first defendant
requesting that sufficient funds
be placed in the account in order to
rectify the shortfall in the account. This process is managed by the
plaintiff’s business
relationship manager and his or her ‘risk
team’. Once a shortfall is detected in an account, an automated
message is
then sent to the client and to the business manager, in
which the client is requested to rectify the account.
[16] The
statement of the first defendant’s current account reflects
that the debit orders were resubmitted
by the plaintiff against the
account on 13 January 2020 and this was ostensibly done on the basis
of an undertaking received from
the first defendant that sufficient
funds would be placed into the account in order to meet the debit
orders. The witness testified
that she was aware of certain
undertakings having been given to the business relationship manager,
Mr Musa Myeza, but she had no
personal knowledge of those
undertakings. She was aware that this included an undertaking by the
second defendant that he was attempting
to raise funds on a property
which was bonded through First National Bank. She understood that
whatever funds were advanced by
First National Bank to the second
defendant, these would be paid into the current account in order to
offset the excess occasioned
by the debit orders. Despite this
undertaking, no monies were received from the first defendant. A
perusal of the account reflects
that despite the re-submission of the
debit orders, the account still did not have sufficient funds to
honour the debit orders,
resulting in them being returned. They were
subsequently re-submitted on 14 January 2020, with the result that
the balance on the
account rose to minus R2 001 404,76.
[17] As
a result of the default on the part of the first defendant, the
plaintiff issued a notice of default and
suspension of credit
facility in respect of the transactional current account, which as at
15 January 2020 had an outstanding balance
of R2 060 5776.62. The
notice, which the first defendant denies having received, gave the
first defendant ten business days in
order to rectify its account.
The witness stated that these notices of default are automatically
generated and dispatched to the
clients, together with an electronic
message service directing the client to immediately pay the amounts
outstanding on the notice.
On receipt of such a notice a client can
either enter into an arrangement to make such payments, or
telephonically contact the
bank. In the case of the first defendant,
there was no response. Ms Rodrigues further stated that the notice of
default, referred
to as annexure ‘POC6’ to the
particulars of claim was also sent by registered mail to the first
defendant. Proof of
posting was evident in the track and trace
receipt which was attached to the particulars of claim.
[18] On
31 January 2020 the second defendant contacted Ms Rodrigues and
escalated a complaint to her that he had
not received the notice of
the first defendant’s account having been in default, or the
reasons therefore. She confirmed
having spent approximately an hour
on the telephone with the second defendant in which she explained
what had transpired in the
account. She subsequently sent an email to
the business relationship manager, Mr Myeza, advising of the concerns
expressed by the
second defendant and enquired of what steps could be
taken to assist him. She was subsequently advised that Mr Myeza had
met with
the second defendant and handed him a copy of the default
notice and that the second defendant had undertaken to make certain
arrangements
to ensure that the shortfall on the account was
rectified. Ms Rodrigues testified that the plaintiff was concerned at
the excess
on the first defendant’s current account,
particularly as the plaintiff’s total exposure in respect of
the first defendant
was in the region of R15 million. In light of the
first defendant not honouring its undertaking to rectify the account,
necessary
instructions were issued for legal proceedings to be
initiated against the first and second defendants. The second
defendant was
again granted an opportunity to cross-examine the
witness but declined.
[19] The
last witness for the plaintiff was Mr Musawakhe Myeza who is employed
as a business manager in the retail
banking division of the
plaintiff. He testified that he has been involved with the first
defendant’s transactional account
since 2019 and was
responsible for the initiation of all the instalment sale agreements,
which formed the subject matter giving
rise to the present
litigation. His role in the conclusion of the agreements was to
conduct affordability assessments in respect
of each agreement after
which the application for credit would then be assessed by the bank’s
credit department. Once the
credit application was approved, the
first defendant would be granted the necessary documentation enabling
it to take delivery
of the equipment or vehicles which were the
subject matter of the instalment sale agreements.
[20] Mr
Myeza further testified that he had personally engaged with the
second defendant in which he had discussed
the state of affairs of
the current account and the second defendant had mentioned to him
that he was in the process of receiving
a funding grant from the
Department of Trade and Industry (‘DTI’) in an amount of
approximately R 800 000, which funds
would be deposited into the
current account. On requesting confirmation of this proposal, all
that the witness received was an
application for funding rather than
an approval from the DTI. Similarly, in respect of the second
defendant’s undertaking
to raise funds on an immovable property
bonded through First National Bank, no further documents were
received. The second defendant
was given the opportunity to
cross-examine the witness, but declined. This concluded the evidence
for the plaintiff. The first
defendant elected not to give evidence
in the matter.
[21] The
undisputed evidence of the plaintiff’s witnesses, who testified
in a clear and coherent manner,
set out in detail the nature of the
transactional account of the first defendant and the steps that the
plaintiff took in accordance
with the terms and conditions of the
agreement, to encourage the first defendant to rectify its account.
Only once those attempts
had failed did the plaintiff proceed with
the litigation. Counsel for the plaintiff submitted that the evidence
of the witnesses,
together with the documentary evidence, proved that
the first defendant’s current account had been debited in
accordance
with the first defendant’s express instructions. At
no stage did the plaintiff or its employees engage in any conduct
which
may have attributed to the first defendant’s current
account having been debited without the necessary authorisation. Once
the account had fallen into arrears, the plaintiff, in accordance
with the terms and conditions of its agreement with the first
defendant, duly gave notice to the first defendant to rectify the
arrears on the account. Once no further funds had been received
from
the first defendant, an instruction was given by the plaintiff for
legal proceedings to be instituted. It was submitted that
the first
defendant breached the agreement with the plaintiff, in terms of
clause 19.1.3, by allowing his account to fall into
arrears, and
failing on demand, to rectify the account. In terms of the agreement,
the bank was entitled, after demand, to claim
immediate payment of
all amounts owing under the agreement.
[22]
Accordingly
it was submitted that the defences raised by the first defendant are
without any merit and fall to be dismissed. I agree
that the evidence
by the plaintiff’s witnesses has proven, on a balance of
probabilities, that the defendants were solely
responsible for
payment of the instalments debited to the current account, and a
failure to remedy the arrears on the account,
justified the plaintiff
in issuing a notice of default, and in instituting the present
action.
[7]
There was no
misconduct or any form of mismanagement by the plaintiff which
resulted in the first defendant’s account exceeding
its
permitted overdraft limit. In any event, it bears repeating that the
second defendant was present in court while the plaintiff’s
witnesses testified. He was afforded an opportunity to cross-examine
these witnesses but elected not to do so in protection of
his
‘rights’. Accordingly, and in the absence of such
evidence being wholly unsatisfactory, the version of the plaintiff
remains undisputed. I accordingly would have no reason for not
granting judgment in favour of the plaintiff as against the first
defendant.
[23] In
so far as the second defendant is concerned, he bound himself as a
surety on 25 April 2019 for the indebtedness
of the first defendant,
and on that basis there is no reason why the second defendant should
not be held jointly and severally
liable together with the first
defendant for all amounts owing to the plaintiff.
[24] In
so far as costs are concerned, the plaintiff seeks costs on an
attorney-client scale in terms of its particulars
of claim. Such
costs are provided for in the agreement (clause 9.5). It is trite
that an award of costs lies in the discretion
of the court. Apart
from the contract providing that costs on an attorney-client scale
should be awarded, the decision to award
costs on this scale is
fortified by the approach adopted by the defendants and their
representatives in the conduct in this trial.
[25] I
accordingly make the following order:
Judgement is granted in
favour of the plaintiff against the first and second defendants,
jointly and severally, the one paying the
other to be absolved, for
the following:
(a) Payment
of the amount of R893 144.15;
(b) Interest
on the said sum at the rate of 9.75% from 28 January 2020 to date of
final payment;
(c) Costs
of suit on an attorney client scale, including such costs occasioned
by the adjournment on
24 August 2021. .
CHETTY J
Appearances
For
the Applicant: K
Hennessy
Instructed
by: Cliffe
Dekker
Hofmeyer
1
Protea Place Sandown
Email:
Eugene.bester@cdhlegal.com
c/o Shepstone
& Wylie
24
Richefond Circle
Email:
vonklemperer@wylie.co.za
Ref: (JMVL/cr/CLIF18219)
For
the respondent: Adiel
Hendricks (IP)
Address: 9
Palm Boulevard
Umhlanga
Rocks
Email: N/A
Cell: 083
642 1555
Date
reserved: 24
August 2021
Date
delivered: 15
September 2021
[1]
Momentum
Life Assurers Ltd v Thirion
[2002]
2 All SA 62
(C) para 34
[2]
Carephone
(Pty) Ltd v Marcus No And Others
1999
(3) SA 304
(LAC), para 54.
[3]
Take
and Save Trading CC
v
Standard
Bank of SA Ltd
2004
(4) SA 1
(SCA), para 3.
[4]
Lekolwane
and
Another
v Minister
of
Justice
and
Constitutional
Development
2007
(3)
BCLR
280
(CC), para
17.
[5]
At the time of issuing summons the amount claimed by the plaintiff
was R1 967 481.77. As set out in paragraph 11 of the application
to
refer to the matter to the expedited trial roll, certain payments
were made by the defendant reducing the plaintiff’s
claim as
at 1 February 2021 to R893 144.15.
[6]
In light of the bundle not having been received prior to the hearing
of the trial, the court instructed the
plaintiff's
counsel to only have regard to those exhibits which were already
annexed to the pleadings, in order to avoid the unnecessary
handling
of documentation and adherence to Covid-19 protocols.
[7]
It is trite that a party who bears the onus of proof has to
discharge the onus. The approach to be adopted when dealing with
the
question of onus has been succinctly stated by Eksteen AJP in
National
Employers’
General Insurance Co Ltd v Jagers
1984
(4) SA 437
(E) at 440D-G:
‘
It seems to me,
with respect, that in any civil case, as in any criminal case, the
onus
can ordinarily only be discharged by adducing credible
evidence to support the case of the party on whom the
onus
rests.
In a civil case the
onus
is obviously not as heavy as it is
in a criminal case, but nevertheless where the
onus
rests on
the plaintiff as in the present case, and where there are two
mutually destructive stories, he can only succeed if
he satisfies
the Court on a preponderance of probabilities that his version
is true and accurate and therefore acceptable, and that the
other version advanced by the defendant is
therefore
false or mistaken and falls to be rejected. In deciding whether that
evidence is true or not the
Court will weigh up and
test the plaintiff's allegations against the general probabilities.
The estimate of
the credibility of a witness will
therefore be inextricably bound up with a consideration of the
probabilities
of the case and, if the balance of
probabilities favours the plaintiff, then the Court will accept his
version
as being probably true.
If however the
probabilities are evenly balanced in the sense that they do not
favour the plaintiff's case any more than they
do the defendant's,
the plaintiff can only succeed if the Court nevertheless believes
him and is satisfied that his evidence
is true and that the
defendant's version is false.’ (emphasis added)