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[2023] ZAKZPHC 88
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Firstrand Bank Limited t/a First National Bank v Mica Foods CC and Another (1465/2022P) [2023] ZAKZPHC 88 (23 August 2023)
IN
THE HIGH COURT OF SOUTH AFRICA
KWAZULU-NATAL
DIVISION, PIETERMARITZBURG
Case
No: 1465/2022P
In
the matter between:
FIRSTRAND
BANK LIMITED t/a FIRST NATIONAL BANK PLAINTIFF
and
MICA
FOODS CC
FIRST RESPONDENT
MESHACH
PILLAY
SECOND RESPONDENT
ORDER
Summary
judgment is granted against the defendants. jointly and severally,
one paying the other to be absolved as follows:
Claim
1. Overdraft.
1.
Payment of the sum amount of R735 059. 39
2.
Interest on the amount referred to in parag 1 above at the rate of
prime (currency
8.25%) plus 12.25% calculated daily on the
outstanding balance and capitalised monthly in arrears from 1
November 2021 to date
of payment, both dates inclusive.
Claim
2. Loan
3.
Payment of the amount of R156 554.41
4.
Interest on the amount referred to in para 3 above at the rate of
prime (currency
8.25) plus 12.25% calculated daily on the outstanding
balance and capitalised monthly in arrears from 1 November 2021 to
date of
payment, both dates inclusive.
5.
The defendants to pay costs of suit on attorney and client scale.
JUDGMENT
Delivered
on:
Mngadi
J
[1]
The plaintiff applies for summary judgment. The two defendants oppose
the application.
[2]
The plaintiff is FirstRand Bank Limited t/a First National Bank a
company duly registered
and incorporated in accordance with the laws
of the Republic of South Africa. The first defendant is Micca Foods
CC a close corporation
duly registered and incorporated in terms of
the laws of the Republic of South Africa. The second defendant is
Meshach Pillay an
adult male person.
[3]
On 7 February 2022 the plaintiff instituted action against the first
and second defendants.
The plaintiff claimed, firstly, that on 8
November 2019 it entered into an overdraft agreement with first
defendant extending an
overdraft facility on a revolving basis with a
limit of R710 633.00 incurring interest on outstanding balance
charged at prime
plus 8%. The repayment of the overdraft required
upon demand. The second defendant as security for the first
defendant's indebtedness
on the overdraft facility entered with the
plaintiff into a suretyship agreement on usual terms.
[4]
The plaintiff claimed that the first defendant in terms of the
overdraft facility
became indebted to the plaintiff in the sum of
R735 059.39 plus interest from 1 November 2021 to date of final
payment, which amount
has become due and payable.
[5]
Secondly, the plaintiff claimed that on 14 August 2018 the plaintiff
concluded a revolving
loan agreement with the first defendant. It
provided that plaintiff would lend in advance to the first defendant
an amount of R300
000.00 incurring interest on outstanding balance at
prime rate plus 8.5%. The loan repayable in monthly instalments of R7
928.00.
The second defendant as security for the first defendant's
obligation in the loan agreement concluded with the plaintiff a
suretyship
agreement. The plaintiff claimed that the first defendant
breached the terms of the loan agreement by failing to pay due
monthly
instalments resulting in an indebtedness in the amount of
R158 554.41 plus interest.
[6]
The plaintiff in the summons attached the overdraft facility
agreement, the revolving
loan agreement and the suretyship
agreements. Further, the plaintiff to prove balances outstanding as
stipulated in the agreements
attached certificates of balance and
notices of default to both defendants dated 10 November 2021.
[7]
The summons was served and on 17 March 2022 the defendants filed a
notice to defend.
On 9 June 2022 the defendants filed a plea. On 29
June 2022 the plaintiff lodged an application for summary judgment.
On 17 August
2022 the plaintiff filed a supplementary affidavit
replacing incorrect annexures attached to the affidavit in support of
the application
for summary judgment.
[8]
The defendants in an affidavit opposing the summary judgment denied
that first defendant
entered into a business overdraft facility
agreement attached to the summons, they denied that a loan agreement
was concluded as
alleged in the in the summons, and they denied that
suretyship agreements were concluded. The deponent stated:
"I
am of the view that such agreements were not concluded and to my best
knowledge I was not ever furnished with a quotation
or any agreements
by the applicant".
[9]
The defendants in the plea raised as special plea that the plaintiff
had not complied
with the relevant provisions of the National Credit
Act 34 of 2005 (the NCA). The plaintiff in the summons stated that
the NCA
did not apply to the transactions with the defendants because
the first defendant is a juristic person, and the agreements were
large agreements. The defendants in the oral argument correctly did
not persist in pursuing the point which has no merit. In
FirstRand
Bank Ltd v Carl Beck Estates (Pty) Ltd and Another
2009 (3) SA
384
(T) the court clarified that the NCA did not apply where the
agreement is entered into with a juristic person, and it is a large
credit agreement as well as to suretyship relating to such agreement
[10]
The defendants in the plea pleaded that the second defendant did not
obtain any credit from the
plaintiff. They admitted that the
plaintiff extended a credit facility but averred that there were no
obligations to repay in terms
of the overdraft facility. They averred
that the second defendant was not provided with a credit facility.
They stated that no
notice of breach by first defendant was given and
averred that the plaintiff has prematurely opted to terminate the
overdraft facility.
[11]
The defendants in the plea in relation to the revolving loan
agreement denied that the agreement
was entered into. The first
defendant averred that the capital amount was not made available on a
revolving basis. They averred
that the first defendant did not breach
the loan agreement due to the plaintiff failing to request that the
first defendant maintain
a sufficient balance on its nominated
account for the purpose of the automatic debit and payment under the
loan agreement. The
plaintiff, they averred, failed to afford the
first defendant an opportunity to remedy the breach.
[12]
The plaintiff in the summary judgment application did not, as
required by Rule 32(2)(c}, attach
copies of the liquid documents the
claims are founded on and it purported to do so in a supplementary
affidavit. The plaintiff
did not seek leave to file a supplementary
affidavit. Rule 32(1) provides the plaintiff may after the defendant
has delivered a
plea apply for summary judgment by means of an
application supported by an affidavit, and that if the claim is
founded on a liquid
document a copy of the document shall be annexed
to the affidavit. Rule 32(4) provides that no evidence may be adduced
by the plaintiff
otherwise than by the affidavit referred to. It is
clear that the Rule makes no provision for the filing of a
supplementary affidavit.
As a result, the supplementary affidavit
falls to be discounted. However, the copies of the documents the
plaintiff relied on for
the application of the summary judgments were
attached to the summons served on the defendants and the plaintiff
sought summary
judgment on the claims set out in the same summons.
The plaintiff, in my view, is not required to to reattach documents
attached
to the summons. The compliance by the plaintiff with the
requirements of subrule 32(2) is determined on consideration of the
papers
as a whole which includes the summons. See
Absa Bank Ltd v
Le Roux and Others
2014 (1) SA 475
(WCC) p484 para18.
[13]
Rule 32(2) (b) states that the defendant to resist summary judgment
may satisfy the court by
affidavit that he has a bona fide defence to
the action. Such affidavit shall disclose the grounds of the defence
and the material
facts relied upon. In
Maharaj v Barclays National
Bank Ltd
1976 (1) SA 418
(A) at 4260 it was held that the
defendant must a least disclose his defence and the material facts
upon which it is based with
sufficient particularity and completeness
to enable the court to decide whether the affidavit discloses a bona
fide defence. Statements
of facts that are equivocal or ambiguous or
contradictory or fail to canvass the matters essential to the defence
raised is not
in compliance with the requirements of the Rule.
[14]
The defendant in relation to both claims in the plea accept
and deny that the first defendant
concluded the agreements. The
second defendant in relation to the first claim denies that he
concluded an overdraft facility agreement
and utilised the credit
facility extended. But the claim against him is that he concluded a
suretyship agreement to provide security
for the obligations of the
first defendant in the credit facility agreement.
[15]
The defendants deny that the first defendant concluded a revolving
loan agreement but aver that
they are not liable because the
plaintiff failed to give them notice of breach and it prematurely
instituted action against them.
It is only a party to the agreement
who would be entitled to a notice to remedy the breach as set out in
the agreement. An averment
that they were entitled to a notice of
breach contains an admission that they concluded the agreement in
question.
[16]
In my view, the plea read with of the opposing affidavit contains
averments constituting vague
bald denials, which are equivocal,
ambiguous and contradictory. It is not known exactly what is denied
and the basis of such denials.
It does not disclose fully the nature
and grounds of the defence and the material facts relied upon. It
does not disclose a
bona fide
defence.
[17]
The application falls to be granted.
[18]
It is ordered as follows:
Summary
judgment is granted against the defendants, jointly and severally,
one paying the other to be absolved as follows:
Claim
1. Overdraft.
6.
Payment of the sum amount of R735 059. 39
7.
Interest on the amount referred to in parag 1 above at the rate of
prime (currency
8.25%) plus 12.25% calculated daily on the
outstanding balance and capitalised monthly in arrears from 1
November 2021 to date
of payment, both dates inclusive.
Claim
2. Loan
8.
Payment of the amount of R156 554.41
9.
Interest on the amount referred to in para 3 above at the rate of
prime (currency
8.25) plus 12.25% calculated daily on the outstanding
balance and capitalised monthly in arrears from 1 November 2021 to
date of
payment, both dates inclusive.
10.
The defendants to pay costs of suit on attorney and client scale.
Mngadi
J
APPEARANCES
Case
Number:
1465/2022P
For
the plaintif:
T.Q
Reddy
Instructed
by:
Schuler
Heerschop Pienaar Xaba Inc.
STRUBENS
VALLEY
For
Defendants:
N.
Nepaul
Instructed
by:
Nervashnee
Nepaul & Associates
DURBAN
NORTH
Date
of Hearing:
03
August 2023
Date
of Judgment:
23
August 2023