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[2023] ZAFSHC 264
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Absa Bank Ltd v Serfontein and Another - Leave to appeal (4659/2021) [2023] ZAFSHC 264 (30 June 2023)

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Certain
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IN THE HIGH COURT
OF SOUTH AFRICA
FREE STATE
DIVISION, BLOEMFONTEIN
Application number:
4659/2021
REPORTABLE: YES/NO
OF
INTEREST TO OTHER JUDGES: YES/NO
CIRCULATE TO MAGISTRATES:
YES/NO
In the application
between:
ABSA
BANK LTD
Applicant
And
JOHAN
SERFONTEIN
1
st
Respondent
JACOBUS
HENDRIK SERFONTEIN
2
nd
Respondent
In
re:
JOHAN
SERFONTEIN
1
st
Applicant
JACOBUS
HENDRIK SERFONTEIN
2
nd
Applicant
And
ABSA
BANK LTD
1
st
Respondent
FRANCOIS
ELS N.O.
2
nd
Respondent
(In
his capacity as a trustee of the
Francois
Els Trust, IT no. 12[…])
ADRIAAN
BENJAMIN VOSLOO N.O.
3
rd
Respondent
(In
his capacity as a trustee of the
Francois
Els Trust, IT no. 12[…])
REGISTRAR
OF DEEDS
4
th
Respondent
JUDGMENT
BY:
VAN
ZYL, J
HEARD
ON:
29 MAART 2023
DELIVERED
ON:
30 JUNE 2023
[1]
This is an application for leave to appeal by the applicant (the
first respondent
in the main application) against the order and
judgment which I delivered in the main application on 9 September
2022 and 22 March
2023 respectively. The said order reads as follows:
“
1.
In terms of the provisions of sections 89, 90 and 91, read with
section 164(1)
of the
National Credit Act, 34 of 2005
, the
acknowledgement of debt, incorporating a power of attorney to dispose
of Portion 3 of the farm W[…] 9[…], Extension
6[…],
District K[…], Free State Province, in extent 616.717 hectares
(“the property”), of which the first
applicant is the
owner, entered into between the applicants and the first respondent
on 17 March 2019, is declared void from the
date it was entered
into.
2.
The agreement of sale of the property to the Francois Els Trust, IT
no. 12[…], represented
by the second and third respondents,
signed by the parties on 7 September 2021 and 13 September 2021
respectively, is declared
void ab initio.
3.
The fourth respondent is prohibited from registering the property on
the basis of the agreement
of sale referred to in paragraph 2 above
into the names of the second and third respondents.
4.
The counter application is dismissed.
5.
The first respondent is ordered to pay the costs of the application
and the counter application.”
[2]
The grounds of appeal are set out in the Notice of Application for
Leave to Appeal,
dated 23 March 2023, and entail the following:
1.
The Learned Honourable Judge, with the greatest respect, erred in
finding that the Acknowledgment
of Debt dated
17 March 2019
(annexure "
AB21
" to the opposing affidavit), is a
supplementary agreement as envisaged in
Sections 89
and
91
of the
National Credit Act, 2005
.
1.1
The Learned Honourable Judge, with the greatest respect, erred in
finding that the Acknowledgment of
Debt dated
17 March 2019
(annexure "
AB21
" to the opposing affidavit), is a
supplementary agreement as envisaged in
Sections 89
and
91
of the
National Credit Act, 2005
, and thereafter, to find that it as a
supplementary agreement transgresses
Sections 90(2)(a)
and (b),
Section 90(2)(h)(i)
,
Section 90(2)(k)(vi)(bb)
,
Section 90(2)(j)
and
Section 90(2)(k)(ii)
of the NCA.
2.
The Learned Honourable Judge, with the greatest respect, erred in
finding that the Acknowledgment
of Debt dated
17 March 2019
is
a credit agreement in terms of
Section 8(4)(f)
of the
National Credit
Act.
2.1   The
Learned Honourable Judge, with the greatest respect, erred in finding
that the Acknowledgment of Debt dated
17 March 2019
(annexure
"
AB21
" to the opposing affidavit), is a Credit
agreement as envisaged in
Section 8(4)(f)
of the
National Credit Act,
2005
, and thereafter, to find that it as a credit agreement
transgresses
Sections 90(2)(a)
and (b),
Section
90(2)(h)(i)
,
Section 90(2)(k)(vi)(bb)
,
Section 90(2)(j)
and
Section
90(2)(k)(ii)
of the NCA.
3.
The Judge with respect erred in not finding that the aforesaid
Acknowledgment
of Debt dated
17 March 2019
is valid and/or
enforceable in terms of the common law and/or precedent and/or the
National Credit Act, 2005
.
4.
The Learned Judge, with respect, erred in finding that Clauses 2.3 to
2.9 of the aforesaid
acknowledgment of debt constitute a resort to
parate executie, and therefore is void.
5.
The Court with the greatest respect erred in not finding that an
agreement between a debtor
and creditor post default allowing the
creditor the power and/or authority to sell movables and/or
immovables to settle the debt
without recourse to the Courts, is
lawful.
5.1   The
Honourable Court erred in not finding that it is lawful for a debtor
to, after he/she fell in default, consent
to the mortgagee selling
the property mortgaged, provided a fair price is realized for and
agreed upon.
6.
The Learned Judge with respect, regarding the assertion that the
aforesaid Acknowledgment
of Debt is a supplementary agreement, erred
not to follow the approach as in paragraphs [38] to [39] in
Standard
Bank of South Africa Limited v Wolmarans N.O. and others
(3949/2021)
[2022] ZAFSHC 118
(16 May 2022)
, in order thereon
to find that it is not a supplementary agreement.
7.
The Learned Judge, with respect, erred in not following the
approach   as in paragraph
[21] of
Ratlou v MAN
Financial Services
2019 (5) SA 117
(SCA)
and thereon
to find that the NCA was not aimed at settlement agreements like this
particular acknowledgment of debt, and that the
application of the
NCA to such acknowledgment of debt will have a devastating effect on
the efficacy and the willingness of parties
to conclude settlement
agreements, and thereby to curtail litigation.”
[3]
Section 17(1)(a)
of the
Superior Courts Act, 10 of 2013
, determines
as follows with regard to leave to appeal:
“
1.
Leave to appeal may only be given where the judge or judges concerned
are of the opinion that –
(a)
(i)       the appeal would have a
reasonable prospect of success;
or
(ii)
there is some other compelling reason why the appeal should be heard,
including conflicting judgments
on the matter under consideration;
(b)
…”
[4]
In the judgment of
Acting National Director of Public
Prosecutions v Democratic Alliance
In Re
Democratic
Alliance v Acting National Director of Public Prosecutions
(19577/09) [2016] ZAGPPHZ 489 (24 June 2016) the court held at para
[25] of the judgment that the
Superior Courts Act has
raised the bar
for granting leave to appeal and in this regard it referred to the
judgment of
The Mont Chevaux Trust (IT 2012/28) v Tina Goosen
and 18 Others
2014 JDR 2325 (LCC) at para [6]:
“
It
is clear that the threshold for granting leave to appeal against a
judgment of a High Court has been raised in the new Act.
The
former test whether leave to appeal should be granted was a
reasonable prospect that another court might come to a different

conclusion, see
Van Heerden v
Cronwright & Others
1985 (2) SA
342
(T) at 343H.  The use of the word ‘would’ in the
new statute indicates a measure of certainty that another court
will
differ from the court whose judgment is sought to be appealed
against.”
See
also
Njango v S
(06/2016)
[2018] ZAFSHC 17
(27 February 2018) at paras [7] –
[8] and
Pretoria
Society of Advocates and Others v Nthai
2020 (1) SA 267
(LP)
at
para [5].
[5]
I will refer to the parties as cited in the present application.
[6]
Mr Benade appeared on behalf of the applicant, like he also did
during the hearing
of the main application when the applicant was the
first respondent. Mr Van der Merwe appeared on behalf of the
respondents. Mr
Van der Merwe was not involved during the hearing of
the main application.
[7]
The main application dealt with the interpretation of certain
sections of the National
Credit Act, 34 of 2005 (“the NCA”).
The crux of the merits of the main application pertained to an
Acknowledgment of
Debt, which incorporated a Power of Attorney
authorising the applicant to sell the first respondent`s immovable
property, dated
17 March 2019, and which document I referred to in my
judgment as the AOD/POA. In my judgment I referred to the NCA as “the

Act”.
[8]
The main findings I made in my judgment were the following:
“
[29]
I consequently find that the AOD/POA constitutes a supplementary
agreement.”
“
[67]
In my view the AOD/POA consequently constitutes a supplementary
agreement which contains unlawful provisions as
prohibited by section
91(2) of the Act and therefore constitutes an unlawful agreement in
terms of section 89(2)(c) of the Act.”
“
[71]
In so far as I may have erred in coming to the conclusion that the
AOD/POA constitutes a supplementary agreement
prohibited by section
91(2) of the Act and therefore constitutes an unlawful agreement in
terms of section 89(2)(c) of the Act,
I deem it necessary to consider
the alternative basis of the applicants’ case, being that the
AOD/POA firstly constitutes
a credit agreement and secondly contains
unlawful provisions as prohibited by section 90 of the Act.”
“
[77]
Consequently and in so far as I may have erred in coming to the
conclusion that the AOD/POA constitutes a supplementary
agreement, I
found in the alternative that it constitutes a credit agreement.”
“
[78]
Earlier in this judgment when I dealt with the AOD/POA on the basis
that it constitutes a supplementary agreement,
I dealt with the
respective provisions contained therein which would have been lawful
if they were included in a credit agreement,
as provided in section
91(2), read with section 90 of the Act.  In view of my
alternative finding that the document constitutes
a credit agreement,
my earlier findings with regard to the provisions which constitute
unlawful provisions in terms of section
90 of the Act, are
mutatis
mutandis
applicable when the AOD/POA is
considered as being a credit agreement.
[79]
There is one distinction though.  When I considered the AOD/POA
on the basis of being a supplementary
agreement, I found it to be an
unlawful agreement in terms of section 89(2)(c), read with section
91(2) of the Act.  When
considered on the basis of constituting
a credit agreement, the presence of the unlawful provisions therein
constitutes a transgression
of sections 90(1) and (2) of the Act.”
[9]
In the judgment of
Standard Bank of South Africa Limited v
Wolmarans N.O. and Others
(
3949/2021)
[2022] ZAFSHC 118
(16 May 2022)
Daffue, J dealt with similar issues regarding the
interpretation of certain sections of the NCA in relation to two
Settlement Agreements/Acknowledgement
of Debts. I adjudicated the
application for leave to appeal in relation to the
Wolmarans
-judgment
after it was allocated to me in terms of
section 17(2)(a)
of the
Superior Courts Act.
[10]
In my judgment in the aforesaid Wolmarans-application for leave to
appeal, dated 17 April 2023,
I,
inter alia,
stated and found
as follows:
“
[11]
The crux of the judgment turns on the interpretation of certain
sections of the NCA, read in conjunction with certain
applicable case
law.  In the process it pertinently dealt with the question
whether the two settlement agreements are subject
to the provisions
of the NCA, or not.  In the process the court also dealt with
the question whether, in an instance where
the underlying facility is
regulated by the NCA, a subsequent settlement agreement constitutes a
supplementary agreement in terms
of the NCA.
[12]    I
presided over an application similar to the present main application
and counter-application.  Although
there may be factual
differences in respect of certain aspects between the application I
dealt with and the present application,
which may impact upon the
relevant questions of law, I had to make similar determinations with
regard to the interpretation of
the NCA.  I delivered judgment
in the matter of
Serfontein and 1 Other v Absa Bank Ltd and 3
Others,
application number 4659 /2021, which judgment was
delivered on 22 March 2023. My most important findings therein
contradict the
findings made by Daffue, J
in casu
.
[13]    I
am of the opinion that the proposed appeal has a reasonable prospect
of success and furthermore that the
aforesaid
Serfontein
-
judgment
and the judgment
in casu
, in my view, constitute “
conflicting
judgments of the matter under consideration”
as determined
in section 17(1)(a)(ii) of the Act.  I am consequently of the
opinion that in addition to the prospects of success,
there is a
compelling reason why the appeal should be heard.
[14]
In terms of section 16(1)(a)(i) of the Act the proposed appeal lies
either to the
Supreme Court of Appeal or a full court of this
Division, depending on the direction issued in terms of section
17(6).  Section
17(6)(a) of the Act determines the following:
“
(
6)
(a)
If
leave is granted under subsection (2)
(a)
or
(b)
to
appeal against a decision of a Division as a court of first instance
consisting of a single judge, the judge or judges
granting leave must
direct that the appeal be heard by a full court of that Division,
unless they consider-
(i)   that
the decision to be appealed involves a question of law of importance,
whether because of its general application
or otherwise, or in
respect of which a decision of the Supreme Court of Appeal is
required to resolve differences of opinion; or
(ii)   that
the administration of justice, either generally or in the particular
case, requires consideration by
the Supreme Court of Appeal of the
decision,
in
which case they must direct that the appeal be heard by the Supreme
Court of Appeal.”
[15]    Mr
Snellenburg submitted and requested that leave to appeal to the
Supreme Court of Appeal should be granted.
Mr Zietsman, on the
other hand, submitted and requested that should leave to appeal be
granted, such leave is to be granted to
appeal to the full court of
this Division.
[16]
In my view the questions of law involved in the proposed appeal are
of utmost importance
because of its general application and that the
administration of justice, generally, requires consideration of the
judgment
in casu
by the Supreme Court of Appeal.”
[11]
In the circumstances and for the same reasons as stated in my
Wolmarans
-judgment in that application for leave to
appeal, I am of the view that leave to appeal is also to be granted
in the present application
and that it is to be granted to appeal to
the Supreme Court of Appeal.
[12]
There is no reason why the usual order that the costs of this
application be costs in the appeal,
is not to be granted.
Order:
[13]
I consequently make the following order:
1.
The applicant is granted leave to appeal to the Supreme Court of
Appeal against the whole
of the order and judgment issued and
delivered in the main application.
2.
The costs of the application for leave to appeal are costs in the
appeal.
C. VAN ZYL, J
On
behalf the of the applicant:
Adv.
H.J Benade
Instructed
by:
Symington
& De Kok
BLOEMFONTEIN
On
behalf of the respondents:
Adv.
R. van der Merwe
Instructed
by:
Blair
Attorneys
BLOEMFONTEIN