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2023
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[2023] ZAFSHC 116
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ABSA Bank Ltd v Erasmus (361/2016; 4079/2016; 4116/2016; 4117/2016; 4771/2016) [2023] ZAFSHC 116 (21 April 2023)
IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Case
no:
361/2016
Case
no:
4079/2016
Case
no:
4116/2016
Case
no:
4117/2016
Case
no:
4771/2016
Reportable:
YES/NO
Of
Interest to other Judges: YES/NO
Circulate
to Magistrates: YES/NO
In
the matter between:
ABSA
BANK
LTD
Applicant
and
DANIEL
POCKLINGBERG ERASMUS
Respondent
JUDGMENT
BY:
AS BOONZAAIER, AJ
HEARD
ON:
23 MARCH 2023
DELIVERED
ON:
21 APRIL 2023
This judgment was handed
down electronically by circulation to the parties' representatives by
email, by being uploaded to
Case Lines
and by
release to SAFLII. The date and time for hand-down is deemed to be
14:00 on 21 APRIL 2023.
INTRODUCTION:
[1]
This is an interlocutory application for the interim attachment of
five motor vehicles for the safekeeping,
pending the finalisation of
the trial.
[2]
Applicant has instituted five separate actions against the respondent
in the abovementioned independent cases,
which were heard jointly as
an application for the following relief,
pendente lite
:
2.1
A declaratory order pertaining to ownership of the relevant vehicles;
2.2
An
interim interdict
prohibiting the disposal of the relevant
vehicles by the respondent or any other person in possession of the
respective vehicles;
2.3
An order authorising the Sheriff, alternatively the applicant to
attach the vehicles and preserve same
pendente lite
.
[3]
In general these applications seek to preserve the aforesaid vehicles
in the ownership of applicant and free
of any hinderance, incumbrance
or alteration which would serve to diminish their value or prevent or
delay their return to the
applicant.
FACTUAL
BACKGROUND:
[4]
The merits of the main actions are not to be adjudicated upon in this
application.
[5]
The applicant which is a registered credit provider under the
National
Credit Act,
[1]
(the NCA) has leased five motor vehicles to the respondent which he
uses for his own benefit. The applicant and respondent entered
into
these partially written and partially oral consumer credit
agreements. These agreements state, that should the respondent
fail
to pay the instalments on the due date or fail to satisfy any of his
obligations in terms of the agreements, the applicant
shall without
prejudicing any of its rights in law be justified in cancelling the
agreements. In the instance of such cancellation
the applicant
inter
alia
be entitled to claim return and repossession of the vehicles.
[6]
It is not disputed that the respondent is in arrears with the payment
of instalments under the leases and
the applicant has instituted an
action against the respondent in which it claims, among other things,
return of the vehicles.
[7]
According to applicant, respondent has breached these agreements in
that he has failed to pay the instalments
in terms of the agreements
and has been in default. Hence applicant launched applications for
summary judgments in three similar
cases against the respondent.
These applications were all opposed based on the same factual
allegations and opposed on the same
grounds.
[2]
[8]
The applications for summary judgments were refused in all of the
abovementioned instances.
[3]
[9]
This court found
inter alia
in February 2017, in the matter of
Absa Bank v Pocklingberg
supra that the court is:
“…
satisfied
that the respondent raised
bona fide
defences which may defeat
the claim. Some of the defences raised by the respondent cannot be
determined by way of affidavits but
at a trial. A trial is the proper
forum for resolving factual disputes, because affidavits are not
suitable for that purpose….”
[10]
The applicant in 2021 launched the present five applications
[11]
It is undisputed that one of the vehicles namely the Jeep Wrangler
2.8 vehicle was repossessed in 2019 and thereafter
was sold by the
applicant.
[4]
APPLICANT`S
CASE:
[12]
The purpose and grounds for the interdict were stated by the
applicant as follows:
12.1
It is the applicant`s case that the only manner in which to ensure
that its claim is secured and remains secure,
is for an order
authorising the attachment and preservation of the vehicle by the
applicant, alternatively, the Sheriff of the
Court and consequently,
for the utilisation and possession of the respondent to be ceased.
12.2
The applicant, avers that there is a well-grounded apprehension of
irreparable harm if the interim relief is not
granted because in the
absence of the interim relief now sought, the applicant has no other
method of preventing the respondent
from alienating, selling or
damaging the assets or otherwise disposing of same. The result of
such conduct will be that the only
security which the applicant has
for the Respondent`s indebtedness will disappear.
12.3
The applicant thus contended that it is being prejudiced. The
vehicles are deteriorating in value, whilst the respondent
is having
use of it. Applicant advanced its funds to respondent to purchase
several vehicles. Respondent breached the agreement,
without making
any means to remedy the breach. Applicant has to utilize further
recourses in order to pursue respondent, who is
in default.
12.4
It is self-evident that the vehicles are depreciating by continued
use and that the respondent’s continued
utilisation of the
vehicles over an extended period will have the result that, should
the applicant be successful in its action,
the vehicles that it
recovers may be virtually worthless. It is untenable that the
respondent be entitled to utilise the vehicles
without effecting
payment under the credit agreements. The applicant seeks to have the
vehicles stored in a place of safety so
that, in the unlikely event
that the applicant is directed after the finalisation of the action
to return the vehicles to the respondent,
they will not have suffered
any meaningful reduction in value.
12.5
It is clear from the pleadings that the respondent disputes the
correctness of the outstanding amounts but he does
not dispute the
fact that he has not paid the various vehicles in full.
12.6
The applicant has no alternative remedy to approach the court for the
interim relief sought.
RESPONDENT`S
CASE:
[13]
The respondent based his resistance to the preservation application
on several grounds being the following:
13.1
The Jeep Wrangler 2.8 vehicle was unlawfully repossessed in 2019 and
thereafter being sold by the applicant, notwithstanding
the still
pending and defended action instituted under case number 4079/2016.
13.2
The applicant is seeking an order interdicting the respondent and any
person found in possession of the particular
vehicle, from disposing
of such vehicle although no third party is cited in the present
application notwithstanding relief being
claimed against unknown
third parties herein.
13.3
All five main actions instituted by the applicant as plaintiff
against the respondent as defendant, were instituted
almost seven
years ago and although the respondent has filed a Plea in each action
in 2017 already, closing the pleadings none
of the main actions have
been brought to trial.
13.4
The allegations with regards to fear of the disposing of the vehicles
are without any factual substantiation because
the allegations made
are generally made without any proof or confirmation of any kind.
13.5
The very same agreement on which the Applicant`s claim is based
entitles the respondent to:
a)
inter alia,
per clause 17 of the agreement, possession and use
of the vehicles;
b)
claim and take transfer of the vehicles. Clause 12 of the Agreement
stipulates that when the respondent has settled his obligations
in
full under the agreements, the respondent will be entitled to
ownership of the vehicles. (Which implies that the applicant at
present is still the owner of the vehicles;
c)
keep the vehicles insured, which he did. The applicant never avers
that the respondent has failed to do so;
13.6
This court has already ruled that a trial is the proper forum to
resolve this matter. The application
in casu
for
pendente
lite
relief is hence unnecessary;
13.7
The relief sought in respect of prayers 1 and 2, are not final relief
sought on motion proceedings but based on
general remarks to
substantiate the possibility of certain future events possibly taking
place;
13.8
The relief sought in prayer 1 is academic of nature. Respondent is
also unaware to whom the Jeep Wrangler was sold
and what the
agreement entails with regards to the ownership thereof.? The
question arises if the applicant
in casu
can be declared owner
with a declaratory order (which is a final order).
13.9
It is trite that it is not permissible to seek an interdict against
future actions which have not yet materialized;
13.10
As to prayer 3, it is clear, given the facts relating to the already
repossessed and thereafter sold Jeep Wrangler,
notwithstanding the
pending and defended litigation to proceed with this application.
13.11
Counsel for respondent submitted that the applicant has an
alternative remedy being, to proceed with the trial in the
main
actions. There is no reason to delay the trial. The matter was
already declared trial ready in October 2021.
13.12
Counsel for respondent further submitted that in terms of the
agreements the applicant needs to terminate the agreements
due to the
alleged breach of the contracts by the respondent.
13.13
In the reported judgment of Tsatsi AJ,
Absa Bank v Pocklingberg,
2017 supra
it was stated as follows:
“
There
are factual disputes in this matter. The applicant was of the view
that it was entitled to terminate the agreement between
it and the
respondent. The respondent is of a different view. I agree with the
respondent. Section 127 of the Act entitles the
consumer in this case
the respondent to terminate the agreement by first giving notice to
the credit provider to terminate the
agreement and sell the goods
which are the subject of litigation if such are in the possession of
the credit provider. It is my
considered view that section 227 does
not apply in this case as the respondent has not sent notice to the
applicant to terminate
the agreement. Even if there was a clause in
the agreement between the parties that entitles the applicant to
cancel the agreement,
the Court still has a discretion to grant or
refuse summary judgment.”
13.14
The court went further to refuse summary judgment per Tsatsi, AJ in
case 4116/2016; 4117/2016 and 4079/2016.The Respondent
contends that
nothing has changed since February 2017 when this judgment was handed
down.
13.15
The applicant moves for relief
in casu
, being well aware of
the issues raised by Tsatsi, AJ in the above-mentioned judgment.
13.16
Respondent argues that a party needs to cancel and terminate an
agreement before one will be able to repossess and relied
on the case
of
Absa Bank v De Villiers and Another 2009(5) SA 40 C,
where
it was held at par. [42] that:
“
In
my opinion the common-law principle (as embodied in the instant
instalment agreement), requiring the cancellation of the instalment
agreement prior to the attachment and repossession of first
respondent `s vehicle, is a necessary requirement for a consistent
and harmonised system of debt enforcement and for the protection of
the consumer`s rights.”
THE
LAW:
[14]
At common law the interim attachment of goods pending the outcome of
vindicatory Quasi vindicatory proceedings is well
established.
[5]
[15]
The
NCA per section 123(2)
provides that if a consumer is in
default under a credit agreement, the credit provider may take steps
“to enforce and terminate”
that agreement.
Section
129(1)
and
130(1)
prescribe the procedure s that must be
followed before a credit provider may take legal steps “to
enforce” a credit
agreement;
Section 123 (1 & 2)
provides:
(1)
A credit provider may terminate a credit agreement before the time
provided.
(2)
If a consumer is in default under a credit agreement, the credit
provider may take the steps set out in Part C of Chapter 6
to enforce
and terminate that agreement.
Section
130(1) provides:
“
(1)
Subject to subsection (2), a credit provider may approach the court
for an order to enforce a credit agreement only if, at that
time, the
consumer is in default and has been in default under that credit
agreement for at least 20 business days and –
1.
at least 10 business days have elapsed since
the credit provider delivered a notice to the consumer as
contemplated in section 86(9),
or section 129(1), as the case may be;
2.
in the case of a notice contemplated in section
129(1), the consumer has –
i.
not
responded to that notice; or
ii.
responded to the notice by rejecting the credit
provider’s proposals; and
(c)
in the case of an instalment agreement, secured loan, or lease, the
consumer has not surrendered the relevant property to the
credit
provider as contemplated in section 127.”
[16]
The function and purpose of an interim attachment order is to protect
the leased goods against deterioration and damage
and to keep them in
safekeeping until the case between the parties has been finalised.
Its purpose is not to enforce remedies or
obligations under the
credit agreement, and the remedy does not form part and parcel of the
debt enforcement process envisaged
in the NCA.
[6]
[17]
In
Administrator,
Cape and Another v Ntshwaqela
[i]
[7]
the
court said of this essential consideration:
“
It is trite that a court
will not engage in the futile exercise of making an order which
cannot be carried out. So, an order for
specific performance of a
contract will be refused where performance is impossible; and an
order
ad factum praestandum
will similarly be refused in such
circumstance (e.g., an order for maintenance where the defendant is
destitute).
[18]
In a credit agreement the agreement must be cancelled before the
credit provider proceeds with steps against the consumer.
In the case
of
SR v DR and Another (2980/2007) [2022] ZAGPJHC 172 (22 March
2022)
it was confirmed that:
“
It
is settled law (at least in this Division) that it is a prerequisite
for the grant of an interim attachment order that any agreement
under
which the respondent has the right to possess the vehicles first be
cancelled “
DISCUSSION
OF THE LAW:
[19]
To succeed in this application the applicant is required to establish
and satisfy the well-established requirements for
the grant of an
interim interdict. It is required to show: (a) that the right which
it seeks to enforce is clear or, if not clear,
is
prima
facie
established, though open to some doubt; (c) that, if
the right is only
prima facie
established there is a
well-grounded apprehension of irreparable harm if the interim relief
is not granted; (c) that the balance
of convenience favours the
granting of interim relief; and (d) that the applicant has no other
satisfactory remedy.
[20]
The respondent disputes both the right relied upon by the applicant
and that the balance of convenience favours the granting
of the
interim relief sought.
[21]
The applicant's case is based on an anti-dissipation interdict, which
would require it to show that the respondent is
likely to spirit away
his property. In
Knox
D'Arcy Ltd and Others v Jamieson and Others
[8]
Groskoppf
JA discussed the nature and effect of the so-called anti- dissipation
interdict and found that what is required is for
the applicant to
show a certain state of mind of the respondent, i.e., that the debtor
is getting rid of funds,
(vehicle)
or is likely to do so, with the intention of defeating the claims of
creditors. [own insertion]
[22]
The question of the balance of convenience must be placed in its
proper perspective. It is a well-settled principle that
the stronger
the case which the applicant makes out, the less balance of
convenience in favour of the applicant there needs to
be for interim
relief to be granted.
[9]
.
As
the applicant has not established a strong right to the preservation
of the vehicles in the pending action, more weight ought
to be placed
on the question of balance of convenience. The court needs to be
satisfied that the balance favours the applicant.
[23]
Where in an application for an interdict
pendente
lite
,
an applicant cannot obtain an interdict unless it provides in
addition to a
prima
facie
case an actual or a well-grounded apprehension of irreparable loss.
In
Stern v Ruskin NO v Appelson
[10]
it
was pointed out that:
“
It
is not sufficient to say that the applicant himself
bona fide
fears such a loss.”
CONCLUSION:
[24]
In this matter I am similarly of the view that it is unnecessary to
enter upon the academic terrain to declare the applicant
owner of the
vehicles, where it is clear and undisputed; it remains the owner
until the respondent pays the last instalment.
[25]
In
Eke v
Parsons
[11]
.the
Constitutional Court affirmed the essential characteristics of a
court order. It is accepted that a court order must be effective,
enforceable and immediately capable of execution.
[26]
I am similarly also of the view that where an order cannot be carried
into effect it cannot, competently, be granted.
Whether the order can
be carried into effect is a question of fact to be determined by the
court asked to grant an order.
[27]
The same principle must apply where the question is one not of
obeying the law but of complying with an order of court
an order
should not be granted because it cannot be complied with, it must be
shown that compliance is impossible on the facts.’
[28]
In my view, the Applicant has not established that it has a
prima
facie
case and that it is entitled to the order sought. The
applicant has another satisfactory remedy against the respondent.
[29]
There appears to be no logic to the applicant`s reasoning, especially
if regard is had to the fact that there is a court
order in place
which obliges him to proceed with the trial.
[30]
There are disputes regarding the facts of the matter. Without an
order to preserve the vehicles the applicant will
still be left with
the tangible options to proceed with the trial to protect its rights
and interests. The balance of convenience
therefore does not favour
the Applicant.
[31]
The applicant did not provide a well-grounded apprehension of
irreparable harm.
[32]
According to our law of contract, restitution (repossession of the
vehicle in the instant case) is the normal result
following from the
cancellation of a contract.
[33]
Absent a claim for the cancellation of the instalment agreement, a
credit provider is not entitled to for a final order
for the
attachment of goods under section
131 of the NCA.
COSTS:
[34]
Respondent seeks a punitive cost order. This court has already ruled
that a trial is the proper forum to resolve this
matter. The
application
in casu
for
pendente lite
relief is hence
unnecessary and burdens the respondent with unnecessary costs.
[35]
The general rule is that the costs should follow the event and this
rule should be departed from only when there are
good grounds for
doing so.
[36]
The basic principle to be applied in deciding on what scale costs
should be awarded is that the court has a discretion,
to be exercised
judicially upon consideration of facts of each case, and that in
essence it is a matter of fairness to both sides.
[12]
[37]
Awards of attorney client costs are used by the court to mark its
disapproval of some conduct which should be frowned
upon.
[13]
[38]
In
Multi-
Links Telecommunications Ltd v Africa Prepaid Services Nigeria Ltd.
[14]
the judge remarked:
“
in my view an overall
balanced view of the whole of the proceedings and the relevant facts
ought to be taken .If a court is then
left with that indefinable
feeling, which feeling must, however be based on rational analysis of
the facts and legal principles,
that something is `amiss`, if one can
put it that way, it may justify that feeling by deciding that the
opposing party ought not
to be out of pocket as a result of the
application having been launched.”
ORDER:
[39]
In the result, I make the following order:
1.
The Applications for preservation of the vehicles are dismissed.
2.
Applicant to pay the costs on an attorney client scale.
BOONZAAIER,
AJ
Counsel
for Applicant: Adv.
K Merabe
Chambers Bloemfontein
Instructed
by: Mr.
Xaba
Strauss Daly Attorneys
Counsel
for the Respondent: Adv.
C Snyman
Chambers Bloemfontein
Instructed
by: Mr
SJ van Biljon
JG Kriek & Cloete
Attorneys
[1]
Act
34
of 2005
[2]
Absa Bank v Erasmus Daniel Pocklingberg, 4116/2016
[3]
Absa
Bank v Pocklingberg 2017 JDR 0399(FB)
[4]
Absa
Bank v Erasmus Daniel Pocklingberg,4079/2016
[5]
SA Taxi Securitisation v Chesane 2010(6) SA 557 at par 6.
[6]
SA Taxi Securitisation (Pty) Ltd v Young (CPD case nu.10249/2008)
[7]
1951
(3) SA 800
(W) at 813.
[8]
1988
(4) SA 924
(W).
[9]
Olympic
Passenger Service (Pty) Ltd v Ramlagan,
13
1957
(2) SA 382
(D)
at 383C-G
[10]
1951(3)SA 800(W)
[11]
[2015] ZACC 30
;
2016 (3) SA 37
(CC) para 12
[12]
‘The Law of Costs “by AC Cilliers, third edition updated
April 2022 par 2.27.
[13]
The Law of Costs supra par 4.04.
[14]
[2013] 4 All SA (GNP) par 38.