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[2023] ZAKZPHC 90
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Crossmoor Transport (Pty) Ltd v ABSA Bank Limited and Others (9953/23P) [2023] ZAKZPHC 90 (4 September 2023)
SAFLII
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Certain
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IN
THE HIGH COURT OF SOUTH AFRICA
KWAZULU-NATAL
DIVISION, PIETERMARITZBURG
Case
no: 9953/23P
In
the matter between:
CROSSMOOR
TRANSPORT (PTY) LTD
APPLICANT
and
ABSA
BANK LIMITED
FIRST RESPONDENT
THE
SHERIFF OF CAMPERDOWN
SECOND RESPONDENT
THE
SHERIFF OF EMPANGENI
THIRD RESPONDENT
THE
SHERIFF OF PINETOWN
FOURTH RESPONDENT
THE
SHERIFF
BENONI
FIFTH RESPONDENT
THE
SHERIFF OF JOHANNESBURG SOUTH
SIXTH RESPONDENT
Coram:
Koen J
Heard:
25 August 2023
Delivered:
4 September 2023
ORDER
The
application is dismissed with costs.
JUDGMENT
Koen
J
Introduction
[1]
The
applicant, Crossmoor Transport (Pty) Ltd (Crossmoor), seeks an
interim interdict against the first respondent, Absa Bank Ltd
(ABSA),
in the following terms:
[1]
‘
1.
Pending the outcome of an action to be instituted by the Applicant
against the First
Respondent within 30 days:
1.1
The First Respondent is interdicted and restrained from:
1.1.1
Executing upon the Order granted by this Court under case number
8991/19 on 17 December 2021 (“the
Court Order”);
1.1.2
Instructing the Second to Sixth Respondent or any other Sheriff, to
attach and remove the assets/articles
listed in paragraph 3 of the
Court Order from any of the Applicant’s premises.
1.2
The Second to Sixth Respondents are interdicted and restrained from
executing
the Court Order.
2.
Should the Applicant not institute the action within 30 days of the
date of this
order, the order in 2.1 and 2.2 will lapse and be of no
further force and effect.
3.
The costs of this application shall be costs in the action.’
[2]
[2]
The relief
claimed is interdictory, akin although not entirely identical to an
application for a stay of a court order in terms
of this court’s
inherent jurisdiction or pursuant to the provisions of rule 45A, but
nevertheless aimed at staying execution
on the entire court order,
specifically any attachment and removal of the assets listed in
paragraph 3 of the court order from
any of Crossmoor’s
premises. In the context of an application for the stay of execution
of a court order the full court in
MEC,
Department of Public Works v Ikama Architects
[3]
remarked:
‘
Courts
enjoy constitutionally supported inherent jurisdiction to control
their own processes, taking into account the interests
of justice. It
appears as if this inherent discretion operates independently of the
provisions of Uniform Rule 45A. Execution must
generally be allowed.
This is so even in cases where a stay is sought pending the
determination of proceedings still to be instituted.
Courts will
generally grant a stay of execution if the applicant demonstrates
that real and substantial justice requires this or
where an injustice
will result if execution proceeds. The court's discretion must be
exercised judicially, but cannot otherwise
be limited.’
(footnotes omitted)
[3]
The issue
in this application is whether Crossmoor has satisfied the
requirements for an interim interdict,
[4]
specifically whether it has proved a
prima
facie
right, even if open to some doubt, to interdict the execution of the
court order and to restrain the second to sixth respondents
from
removing the assets in paragraph 3 of the court order.
Background
[4]
The events material to this application are largely common cause, or
not
seriously disputed. They include the following:
(a)
Over time
Crossmoor and ABSA
[5]
concluded
various credit agreements, in terms of which Crossmoor was to acquire
various assets/articles referred to in paragraph
1.1.2 of the relief
claimed (the assets);
(b)
Crossmoor conducted itself in relation to those credit agreements in
such
a way that ABSA became entitled to and did cancel all the credit
agreements;
(c)
Crossmoor was thereafter liquidated on 27 September 2021;
(d)
On 18 November 2021 Crossmoor, its liquidators, ABSA, and other
creditors
of Crossmoor concluded an agreement (the settlement
agreement);
(e)
The settlement agreement expressly provided inter alia that:
(i)
The liquidation order in respect of Crossmoor was discharged
by
consent (paragraph 1);
(ii)
On discharge of the liquidation order, a consent order attached to
the
settlement agreement (the consent order prayed) ‘would be
made an order of court to replace the final liquidation order’
(paragraph 2);
(iii)
The consent
order prayed would ‘be made an order of court by an application
brought by ABSA’ exactly in accordance with
its terms (clause
4), because of the practice in the High Court, KwaZulu-Natal Division
regarding making settlement agreements
an order of court (paragraph
5);
[6]
(iv)
The terms of the recordal in the consent order prayed were
‘explicitly
agreed upon and the terms and conditions of the
recordal were verbatim enforceable as an agreement between the
parties’,
to be granted by the court, ‘and enforceable
between ABSA and Crossmoor, as if specifically incorporated into the
settlement
agreement’ (paragraph 8);
(v)
ABSA and Crossmoor specifically agreed that the consent order prayed
would
be an agreement by ABSA to enter into the consent order prayed
as a ‘payment arrangement of the debt in paragraph 2’
of
the consent order prayed, ‘without novating the cancellation’
of the credit agreements, ‘which would remain
cancelled’
(paragraph 9.1);
(vi)
ABSA’s ownership in the assets remains vested in those assets
as is set
out in the consent order prayed for the return of the
assets (paragraph 9.2);
(vii)
The liquidation order would be replaced between Crossmoor and ABSA by
the consent
order prayed as a court order ‘for the return of
the assets and a repayment arrangement of the debt’ (paragraph
9.3);
(viii)
Apart from the terms in the settlement agreement and consent order
prayed, ‘the
terms and conditions of the individual instalment
sale [or credit] agreements between ABSA and Crossmoor would remain
of full force
and effect’ (paragraph 9.4);
(ix)
The settlement agreement provides, as set out in the consent order
prayed,
that the terms of the instalment sale agreements would only
be amended and varied as set out in the consent order prayed. And
further
where there is ‘any discrepancy between the individual
instalment sale agreements and the consent order prayed, the terms
of
the consent order would prevail’ (paragraph 11);
(x)
Paragraph 12 of the settlement agreement provides that:
‘
The settlement
agreement would constitute the whole of the agreement between the
parties relating to the liquidation and consent
order prayed, save to
the extent provided therein, and no extension, amendment, leniency or
any relaxation granted by any party
in terms of the settlement
agreement would be binding on any party, unless same was reduced to
writing and signed by the parties
involved and if necessary’;
(xi)
The settlement agreement further states that no ‘addition,
variation,
deletion or agreed cancellation of all or any clauses or
provisions’ would have ‘any force or effect unless in
writing
and signed by the parties’ (paragraph 13);
(xii)
No waiver of any of the terms and conditions of the settlement
agreement would be
binding or effectual for any purpose unless in
writing and signed by the parties. Any such waiver would be effective
only in the
specific instance and for the purpose given. Failure or
delay on the part of any party in exercising any right, power or
privilege
would not constitute or be deemed a waiver thereof, nor
would any whole or partial exercise of any right, power or privilege
preclude
any other or further exercise of any right, power or
privilege (paragraph 14).
(f)
The consent order prayed attached to the settlement agreement:
(i)
Repeated that the ‘final liquidation order against [Crossmoor]
was discharged and set aside' (paragraph 1);
(ii)
Recorded that Crossmoor was ordered forthwith to deliver to ABSA the
assets described in the second to fourth columns of paragraph 2
thereof (paragraph 2);
(iii)
Recorded that Crossmoor agreed to make payment to ABSA in the amount
of R134 544 725
together with interest on the accounts set
out in paragraph 2, that is the various individual credit agreements,
in the amounts
as set out in paragraphs 3.1 to 3.29 (paragraph 3);
(iv)
Recorded that the execution of the order in paragraph 2, that is for
the forthwith
delivery of the assets forming the subject matter of
the individual credit agreements, was suspended pending compliance by
Crossmoor
(or as long as Crossmoor complied) with its payment
obligations in clause 3 of the consent order prayed (paragraph 4);
(v)
Further, should Crossmoor ‘fail to make any payment in terms of
paragraph 3 within 5 days of notice to remedy such breach, the
suspension of paragraph 2 [that is for the return of the assets]
shall
ipso facto
lapse and the Sheriff be authorised to attach
and deliver all assets in paragraph 2’ to ABSA (paragraphs 4.1
and as also
mirrored in paragraph 5);
(vi)
The consent order further recorded that:
(aa)
Crossmoor was indebted to ABSA ‘in the amount of
R134 544 725.00 plus interest
for the financing of certain
assets on instalment sale and lease agreements, as set out in
paragraph 2’ (paragraph 10.1);
(bb)
Crossmoor had defaulted on the agreements with ABSA and ABSA
‘cancelled the agreements
prior to institution of the
liquidation application’ (paragraph 10.2);
(cc)
ABSA ‘agreed to enter into the agreement as a payment
arrangement of the judgement
debt in paragraph 2, without novating
the cancellations of the agreements referred to in paragraph 2 above
which remain cancelled’
(paragraph 10.3);
(dd)
ABSA reserved ‘ownership of the assets referred to in paragraph
2 above pending payment
of the full outstanding balance on each
asset’ (paragraph 10.4);
(ee)
Where Crossmoor defaults and fails to remedy one of the
liabilities/payments this would
constitute a default against all,
‘and the suspension of the order for repossession would
automatically lapse and [ABSA would]
be entitled to enforce the order
for repossession of all the assets (paragraph 10.7);
(ff)
The consent order prayed would be the consent order as agreed upon
‘for
return of the assets and a repayment arrangement of the
debt’ (paragraph 10.8);
(gg)
Where any asset is fully paid, ABSA will release ownership of the
asset in favour of Crossmoor
(paragraph 10.9);
(hh)
ABSA would deliver to Crossmoor ‘all such documents required to
effect transfer of ownership’
of the asset to Crossmoor
(paragraph 10.9);
(ii)
Crossmoor ‘would be bound by the terms and conditions of every
loan/credit
agreement entered into with’ ABSA (paragraph
10.10);
(jj)
ABSA would be entitled to ‘appropriate 50% of any payments made
to any of the above liabilities in respect of the assets, the balance
of 50% to be allocated to the liabilities of the assets from
the
least amount owing’ (paragraph 10.11.2).
(g)
The court order granted pursuant to the settlement agreement and
draft
order prayed, reflects the date as 17 December 2021 although it
bears the registrar’s stamp of 22 December 2021 (but it is
the
one contemplated in the relief claimed). It mirrors the material
terms of the settlement agreement and consent order prayed,
and
provides as follows:
(h) Crossmoor was
directed to deliver to ABSA the assets listed in the table contained
in paragraph 3 thereof (paragraph 3);
(ii)
Crossmoor would pay ABSA the amount of R134 544 725,
together with interest,
as per the accounts detailed in paragraph 3,
in accordance with the schedule contained in paragraph 4 thereof
(paragraph 4);
(iii)
The execution of the order set out in paragraph 3 would be suspended
pending compliance
by Crossmoor with its ‘payment obligations
in paragraph 4’. Should Crossmoor ‘fail to make any
payment in terms
of paragraph 3 within 5 days of notice to remedy
such breach, the suspension in paragraph 3 shall lapse
ipso facto
and the Sheriff be authorised to attach and deliver all assets in
paragraph 2’ to ABSA (paragraph 5.1);
(iv)
In the event that Crossmoor failed ‘to make any payment in
terms of paragraph 4 on
the due date/s, and fails to remedy such
breach within 5 days of notice to do so, then in that event, the
suspension of paragraph
3 shall ipso facto lapse and the Sheriff be
authorised to attach and deliver all assets described in paragraph 3
above’ to
ABSA, in the event that Crossmoor failed to deliver
the assets to ABSA (paragraph 6);
(v)
The following was agreed to and recorded that:
(aa)
Crossmoor is indebted to ABSA in the amount of R134 544 725
plus interest for the
‘financing of certain assets on
instalment sale and lease agreements, as set out in paragraph 3’
(paragraph 11.1);
(bb)
Crossmoor had defaulted on the agreements with ABSA and ABSA
‘cancelled the agreements
prior to institution of the
liquidation application’ (paragraph 11.2);
(cc)
Further, ABSA ‘agreed to enter into the agreement as a payment
arrangement of the
judgement debt in paragraph 3, without novating
the cancellations of the agreements referred to in paragraph 3 above
which remained
cancelled’ (paragraph 11.3);
(dd)
Furthermore, ABSA ‘reserved ownership of the assets referred to
in paragraph 3 pending
payment of the full outstanding balance on
each item/asset’ (paragraph 11.4);
(ee)
Where Crossmoor defaults and fails ‘to remedy on one of the
liabilities/payments’
this would constitute a default against
all liabilities/payments, and the ‘suspension of the order for
repossession’
would automatically lapse and ABSA be ‘entitled
to enforce the order for repossession of all the assets’
(paragraph
11.7);
(ff)
The order as prayed ‘was agreed upon as a consent order for
return of
[the] assets and [as] a repayment arrangement of the debt’
(paragraph 11.8);
(gg)
Where an asset is fully paid it would be released by ABSA in favour
of ownership to Crossmoor
(paragraph 11.9);
(hh)
ABSA would deliver to Crossmoor ‘all such documents required to
effect transfer of ownership
of the item’ to Crossmoor
(paragraph 11.9);
(ii)
Crossmoor would ‘be bound by the terms and conditions of every
loan/credit
agreement entered into with’ ABSA (paragraph
11.10);
(jj)
ABSA would be entitled to appropriate 50% ‘of any payments made
to any of the above liabilities in respect of the assets, the balance
of 50% to be allocated to the liabilities of the assets from
the
least amount owing’ (paragraph 11.11.2).
(i)
Crossmoor defaulted on its obligations as per the repayment
arrangement of the debt;
(j)
A proper written demand was made on 4 October 2022 for Crossmoor
to
remedy its default by payment of the arrears then due in the amount
of R5 326 723 within 5 days, failing which ABSA
would
proceed with execution;
(k)
Crossmoor did not remedy this default within the 5 days;
(l)
On 3
November 2022 ABSA proceeded to have a writ issued for some of the
assets listed in paragraph 3 of the court order;
[7]
(m)
During the period subsequent to Crossmoor’s default, the
settlement agreement
had required it to pay:
(i)
R4 million on or before 31 October 2022, but it paid only
R3
million on 1 November 2022.
(ii)
R4 million on or before 30 November 2022, but it paid only
R2 726 602.68
on 31 December 2022:
(iii)
R4 million on or before 31 December 2022 but it paid only
R1 194 235.39
on 31January 2023;
(iv)
R5 million on or before 31 January 2023, but it paid only
R2 732 440,21
on 16 February 2023;
(n)
On 3 February 2023 the Sheriff served the writ on Crossmoor but was
unable
to locate any of the assets.
(o)
In respect of the period subsequent to the service of the writ
Crossmoor
had been required to pay:
(i)
R5 million on or before 28 February 2023, but it paid
only R2.5
million on 28 February 2023;
(ii)
R5 million on or before 31 March 2023, but it paid only R1 857 809,92
on 30 April 2023:
(iii)
R5 million on or before 30 April 2023, but it paid only R444 813,50
on
31 May 2023;
(iv)
R5 million on or before 31 May 2023, but it paid only R1 117 183.08
on 27 June 2023.
On
4 July 2023, after some assets were traced and attached, Crossmoor
launched this application as one of urgency.
Discussion
[5]
When Crossmoor failed to remedy its default in accordance with the
repayment
arrangement in response to the demand of 4 October 2022
within the stipulated 5 days, the suspension of the order (in terms
of
the settlement agreement and consent order and paragraph 5 of the
court order) automatically lapsed and Crossmoor was required to
forthwith deliver the assets to ABSA. ABSA became
ipso facto
entitled to ‘enforce the order for repossession of
all
the
assets’ (emphasis added), as provided in paragraphs 5.1 and
11.7 of the court order. ABSA was therefore entitled to proceed
with
the issue of the writ, in respect of all the assets.
[6]
I did not understand Crossmoor to dispute that default position.
[7]
The writ
should probably, or at least, at best for Crossmoor, exclude assets
of which ownership had passed to it. At least 18 assets
that formed
part of the list of assets in paragraph 3 of the court order had, as
remarked above,
[8]
been omitted
from the writ. But the remaining assets fell to be returned to ABSA.
[8]
In support
of its argument that ABSA is not entitled to the return of all the
assets by executing the court order,
[9]
Crossmoor raised three arguments as establishing a prima facie right
entitling it to interdict and restrain the execution of the
court
order and the removal of the assets in paragraph 3 of the court
order. These arguments, in no particular order, are that:
(a)
ABSA had failed to deliver the documents required to effect transfer
of
ownership of the assets fully paid, which it was required to
release to Crossmoor, and that this was a reciprocal obligation to
the payments Crossmoor was required to make, which failure thus
excused Crossmoor from making any further payments, presumably
that
it was therefore not in default, and that the suspension of the order
requiring Crossmoor to deliver the assets to ABSA remained
in place
(the reciprocity argument).
(b)
In receiving and retaining the payments made after Crossmoor’s
default,
ABSA had waived the right to proceed with the execution of
paragraph 3 of the court order (the waiver argument).
(c)
Crossmoor had acquired ownership of certain assets which appear on
the
writ, because it had made payment in full in respect of those
assets. It contends that the payments it has made, have not been
correctly allocated by ABSA in accordance with the formula for
allocation prescribed in paragraph 11.11.2 of the court order, and
that if the payments were correctly allocated, it would have
resulted in payment having been made in full in respect of some
assets and hence ownership therein passing to Crossmoor (the
ownership argument).
These
arguments will be dealt with seriatim below.
Reciprocity
[9]
It is trite
that for reciprocity to apply ABSA’s performance had to precede
that of Crossmoor, or they both had to perform
at the same time.
[10]
[10]
The facts material to this argument are common cause. The issue is
mainly one of interpretation
of the settlement agreement and the
court order. The preliminary enquiry is to determine whether the
obligations referred to are
reciprocal to the extent that if ABSA
failed to deliver the documents required to pass transfer in respect
of assets fully paid,
all payments remaining to be paid by Crossmoor
would be excused.
[11]
Crossmoor’s counsel was invited to explain how the failure to
deliver documents in
respect of assets which it may contend ownership
had passed to Crossmoor, as much as it would entitle Crossmoor
thereafter to the
delivery of documents to pass transfer in respect
of those assets, could be reciprocal to any obligation on the part of
Crossmoor
to make further payments, which remained unpaid, in respect
of assets not yet ‘paid’ and in respect of which
ownership
would not have passed.
[12]
Counsel wisely did not seek to advance further submissions in regard
to this argument and
simply said that Crossmoor would stand by the
argument advanced in its heads of argument, without abandoning the
argument.
[13]
I have endeavoured to summarise the argument as reflected in
Crossmoor’s heads of
argument, as I understand it, above.
Crossmoor’s contention is without any merit. Although payments
made, correctly apportioned,
may result in payment of the debt owing
in respect of a particular asset being paid in full, thus entitling
Crossmoor to ownership
of that asset passing to it, the obligation to
deliver the documents to give effect to the passing of ownership
relates to the
ownership in respect of that specific asset. The
factual position is as follows: first, the documents in respect of
that asset
need only be delivered once payment has been made.
Secondly, even if it is accepted in favour of Crossmoor that the
obligation
to deliver the documents, at best, was to be made
simul
ac semel
or
pari passu
with payment, then the delivery of
such documents is reciprocal to the payment in respect of that
particular asset. There is no
basis in law to find that the failure
to deliver the documentation in respect of such asset would excuse
the withholding of further
payments as they fall due, or that payment
of payments that had fallen due, would be excused.
[14]
The reciprocity argument does not establish any
prima facie
right to interdict the execution of the court order.
Waiver
[15]
Waiver is a
unilateral act which needs to be manifested by words or conduct to be
effective. Once it is effective, the right concerned
is lost for
good. Waiver has two components, a mental one and a physical one.
[11]
[16]
In
Coppermoon
Treading 13 (Pty) Ltd v Government Eastern Cape Province
[12]
it was said that:
‘
[24]
Election and waiver are legal acts and their requirements may be
stated as follows: Waiver is the intentional and unequivocal
renunciation or relinquishment of a known right . . . Election
postulates a choice between two inconsistent rights, each of which
has different legal consequences . . . Common to both waiver and
election is that it is a matter of the intention of the party
said to
have made the election, or waived the right in question. The
intention is determined objectively, that is, it is adjudged
by its
outward manifestation in the form of words, spoken or written, or in
the form of conduct or a combination of words and conduct
. . .
[25]
If a party does not expressly waive a right, and waiver is to be
inferred, the conduct relied upon must be such as is more
consistent,
on a reasonable view thereof, with an intention to waive the right in
question. The outward manifestations of intention
must accordingly be
adjudged from the perspective of a reasonable person in the position
of the other party . . .
.
. .
[27]
The burden of proof is on the party who alleges that an election has
been made, or that a right has been waived. By reason
of the fact
that no one is presumed to waive his rights, clear proof is required
of an intention to do so’.
[17]
The onus is on Crossmoor to show that ABSA, with full knowledge,
decided to abandon its
right to enforce the court order for the
return of its assets, whether expressly or by conduct plainly
inconsistent with an intention
to enforce the order in its favour.
[18]
Crossmoor did make payments subsequent to its breach in October 2022,
and these were received
by ABSA. These payments have been set out
above.
[19]
At the stage those payment were made, the legal position was that the
suspension of the
part of the court order requiring Crossmoor to
deliver the assets to ABSA, had
ipso facto
and automatically
fallen away. Crossmoor was required to deliver the outstanding
assets. ABSA could proceed with the issue of a
writ. ABSA did proceed
with the issue of the writ for delivery of assets. The fact that ABSA
kept the payments and allocated them
as payments to the various
credit agreement accounts did not mean that ABSA elected to abandon
its remedy to cancel the credit
agreements. It sought to give effect
to the cancellation by enforcing the court order. Following
cancellation, in the ordinary
course, the assets must be returned,
and valued or otherwise dealt with as the particular credit agreement
may prescribe, whereafter
the difference between the outstanding
balance on the accounts, after taking into account all payments,
including subsequent payments
made and allocated, less the value of
the asset if returned, would be recoverable as damages. The further
payments made pursuant
to the repayment arrangement will thus not be
irrelevant in the context also of enforcing the remedies available
upon the cancellation
of the credit agreements.
[20]
The correspondence exchanged between the parties’ attorneys
during that time is also
consistent only with an intention to secure
the return of the assets. The writ was issued on 3 November 2022. It
was served on
Crossmoor. Attempts were made to trace the physical
whereabouts of the assets for removal when these could not be found
by the
Sheriff. The evidence in this regard is not summarised in this
judgment as it stands unchallenged in the affidavits filed. There
is
simply no substance to the contention that, viewed objectively, ABSA
had waived its right to enforce the court order providing
for the
return of its assets.
[21]
Apart from the aforesaid facts being inconsistent with any notion of
a waiver of the right
to enforce the court order, reliance on a
waiver by conduct would, in the circumstances of this application,
also not be legally
competent. That statement requires a brief
examination and identification of the true
vinculum juris
between Crossmoor and ABSA.
[22]
The court
order is a consent order for the return of the assets. That is what
it provides. It gives effect to what was agreed in
the settlement
agreement read with the consent order prayed annexed to the
settlement agreement. The court order must be read and
understood in
that context and its purpose, the latter being to give effect to the
settlement agreement. In
Eke
v Parsons
it
was said that where a court order records an agreement of
settlement
:
[13]
‘
The
intention of the parties is ascertained from the language used read
in its contextual setting’.
Similarly,
in
HLB
International (South Africa) (Pty) Ltd v MWRK Accountants and
Consultants (Pty) Ltd
[14]
it was explained that:
‘
The
manifest purpose of the judgment is to be determined by also having
regard to the relevant background facts which culminated
in it being
made.’
[23]
The court order simply sought to give the imprimatur of an order of
court to what was agreed
contractually in the settlement agreement
read with the consent order prayed annexed thereto. These documents
and the court order
must all be interpreted together: Crossmoor
agreed to be bound to the terms and conditions of every credit
agreement (clause 11.10);
Crossmoor agreed that it had defaulted on
the credit agreements and that ABSA had cancelled the agreements
prior to the institution
of the liquidation application (clause
11.2); it agreed that ABSA entered into the agreement as a part
payment arrangement of the
judgment debt in paragraph 3 of the court
order, without novating the cancellations of the credit agreements
(paragraph 11.3);
paragraph 3 of the court order was for the return
of assets, which would be remedied following on the cancellation of
any credit
agreement. Cancellation of the credit agreements was the
remedy elected by ABSA following Crossmoor’s various breaches
of
the various credit agreements, and ABSA would be entitled to
pursue whatever remedies are available to it following such
cancellation,
as it might be entitled to pursue in terms of the terms
and conditions of the credit agreements, the terms of which Crossmoor
expressly
agreed it would continue to be bound to.
[24]
All terms of the credit agreements, including non-waiver provisions,
would continue to
apply. Equally important, the settlement agreement
incorporates the aforesaid terms of the consent order prayed ‘as
if specifically
incorporated into this settlement agreement’.
It also expressly provides that no waiver of any of the terms of the
settlement
agreement and consent order prayed, including that
Crossmoor would be bound to all the terms of the credit agreements,
would be
binding unless in writing and signed by the party giving the
same.
[25]
There is no such written waiver.
[26]
To conclude, ABSA was entitled, following Crossmoor’s breach in
October 2022, to
enforce the order for the return of the assets, for
the reasons set forth above. It never exhibited an election to the
contrary.
It never in writing, in a document signed by the parties,
elected not to claim the return of the assets. The repayment
arrangement
remained an indulgence. Even a failure to exercise the
power to claim the return of the assets immediately would not
constitute
or be deemed to amount to a waiver (paragraph 14 of the
settlement agreement).
Ownership
of assets
[27]
Crossmoor has placed reliance on clause 11.8 of the court order and
also paragraph 9 of
the settlement agreement and paragraphs 10.8 and
10.9 of the consent order prayed, emphasising that what was agreed
included not
only the ‘return of the assets’ but also ‘a
repayment arrangement of the debt.’ The issue is what
is
to be made of the payments made as part of the ‘repayment
arrangement’, after Crossmoor failed to remedy its breach
of
the repayment arrangement in October 2022, insofar as these might
result in an asset being fully paid (as contemplated in paragraph
11.9 of the court order) following the appropriation of payments (as
provided for), and an asset fully paid ‘shall be released
. . .
in ownership to [Crossmoor].’
[28]
The remedy ABSA had elected, namely cancellation, was expressly
provided not to be novated
by the settlement agreement, the consent
order prayed, or the court order. The repayment arrangement was an
indulgence. It did
not constitute a revival or reinstatement of the
various credit agreements, or a new ‘sale,’ because that
would be
in conflict with the very act of cancellation. It must be
remembered that it was recorded that Crossmoor was indebted to ABSA
in
the amount of R134 544 725, being the total of the
account balances, ‘plus interest for the financing of certain
assets.’ Now that Crossmoor had failed to adhere punctually to
the repayment arrangement, there would be questions of interest
arising. For the purpose of this judgment it shall be accepted that
the indulgence to release assets in ownership to Crossmoor
once an
asset is ‘fully paid’ would continue.
[29]
The question is whether ownership of the assets reflected in the
writ, have been shown
to have passed to Crossmoor, thus precluding
ABSA from executing on the court order in its totality. The total
debt owing by Crossmoor
(ignoring further interest) was agreed to in
the settlement agreement and court order. The details of the payments
made by Crossmoor
are known to it. And paragraph 11.11.2 of the court
order provided how the payments were to be appropriated.
[30]
It would be incumbent on Crossmoor to show that it had ‘fully
paid’ all the
assets, such that ownership of all the assets
would be required to ‘be released’ by ABSA to it. In that
respect it
is common cause that the full indebtedness in respect of
the assets has not been paid in full. Alternatively, and at best for
Crossmoor,
it would have to show that it had fully paid the amount
owing in respect of certain assets, and that these specific assets
should
be excluded from the execution process, although that was not
the basis for the relief claimed.
[31]
As regards proof, the test is the well-known test which applies in
interim interdicts,
namely:
‘
Insofar
as the appellant also sought an interim interdict
pendente
lite
it
was incumbent upon him to establish, as one of the requirements for
the relief sought, a prima facie right, even though open
to some
doubt (
Webster
v Mitchell
1948 (1) SA 1186
(W) at 1189). The accepted test for a prima facie
right in the context of an interim interdict is to take the facts
averred by
the applicant, together with such facts set out by the
respondent that are not or cannot be disputed and to consider
whether, having
regard to the inherent probabilities, the applicant
should on those facts obtain final relief at the trial. The facts set
up in
contradiction by the respondent should then be considered and,
if serious doubt is thrown upon the case of the applicant, he cannot
succeed. (
Gool
v Minister of Justice and Another
1955 (2) SA 682
(C) at 688B--F and the numerous cases that have
followed it.)’
[15]
[32]
ABSA, in
its supplementary answering affidavit, contradicted Crossmoor’s
claim that ownership in certain assets had passed
to it. Further,
ABSA denied that there are any assets reflected in the writ which are
fully paid and in respect of which ownership
had passed to Crossmoor
at the time, that is prior to the urgent application being
issued.
[16]
[33]
Crossmoor has not identified any specific assets which it contends
are fully paid. Its
argument proceeds on the basis that the
allocation of payments which ABSA has made, is not in accordance with
the formula, which,
had the allocation been done correctly, would
have resulted in certain assets being fully paid, and thus would
provide it with
a prima facie right of ownership of those assets. It
could do no more than its counsel from the bar pointing to certain
assets
at the bottom of the ABSA spread sheets, which it was
submitted would have been fully paid if the allocation was done
correctly.
Crossmoor accordingly seeks to interdict the execution of
the entire court order pending an action where it can be investigated
which assets had come to be owned by Crossmoor. In the interim,
pending the determination of the action, it would however mean
that
without cogent evidence demonstrating that ownership of specific
assets prima facie might have passed to Crossmoor, Crossmoor
would
effectively also interdict ABSA from the return of assets which
Crossmoor is obliged to return and in respect of which Crossmoor
has
no defence.
[34]
The disputed issue is therefore no longer primarily whether the
execution of the court
order should be suspended, but rather a
confession that following Crossmoor’s breach the assets all had
to be returned as
the terms provided in the court order, but that
this consequence is now sought to be avoided on the ground that some
assets, yet
unidentified, have passed into the ownership of
Crossmoor, because they had been paid for in full.
[35]
At best
Crossmoor would be able to interdict the court order being executed
in respect of those assets in respect of which it can
show it had
acquired ownership. But it cannot interdict the execution of the
entire court order altogether simply because the payment
allocation
might be open to criticism, and ownership of one or more of the
assets might or should have passed to Crossmoor. As
was said in
Lavelikhwezi
Investments (Pty) Ltd v Mzontsundu Trading (Pty) Ltd
:
[17]
‘
There
is no doubt that a court does have jurisdiction to suspend the
execution of any order. However, that discretion must
be
exercised in such a way that court orders are not undermined by being
suspended for speculative reasons in circumstances where
the judgment
or order is not or cannot be put in dispute. Sound factual and
legal basis for the suspension so sought must
be clearly established
by the applicant to enable the court to carefully exercise its
discretion.’
[36]
The onus of
proving its ownership of specific assets still reflected in the writ,
is on Crossmoor – he who alleges must prove.
That will involve
proving that payment had been made in full in respect of those assets
prior to the application being launched.
The onus of proving payment
is always on the party alleging payment.
[18]
Where the issue is whether appropriation of a certain payment should
have been applied in respect of a particular indebtedness,
the onus
of proof, by logical extension, is similarly on the party alleging
such allocation of payment. That is what
Pillay
v Krishna
implicitly requires:
‘
If
one person claims something from another in a Court of law, then he
has to satisfy the Court that he is entitled to it.’
[19]
[37]
It was for Crossmoor to establish its ownership of those assets, at
least at a prima facie
level even if open to some doubt. It should
have done so in its founding affidavit. It is not sufficient at the
level of seeking
to establish a prima facie right of ownership, to
simply complain that the allocation of payments made by ABSA was
irregular, and
to suggest that if done properly in accordance with
the terms agreed, ownership of some assets might no longer would vest
in ABSA.
Crossmoor was required to explain which assets had been
fully paid. It could have done so without much difficulty.
[38]
The allocation of the payments is not something that falls peculiarly
within the knowledge
of ABSA only. The balances owing in respect of
each credit agreement appears from the consent order prayed and the
court order.
The payments made thereafter are largely common cause on
the affidavits, but would in any event be known to Crossmoor (as it
has
the onus to prove the payments). The allocation of payments would
be a simple arithmetical exercise easily performed in an
uncomplicated
spreadsheet. Crossmoor has made no attempt to do such
exercise, or anything similar, to prove which assets should be
excluded from
any execution on the basis of its alleged ownership. It
has even less so proved that ownership of all the assets would have
passed
to it, thus justifying an order restraining ABSA from
executing upon the court order altogether.
[39]
It is not for ABSA to prove which assets remain owned by it. In terms
of the court order
and settlement agreement, the suspension of the
order for delivery of the assets admitted to be owned by it, had ipso
facto ceased.
It is for Crossmoor who alleges that ownership has
passed in respect of all, or some of those assets to prove its
entitlement to
ownership.
[40]
Crossmoor maintained that it would be sufficient simply to cast doubt
on the correctness
of ABSA’s appropriation, as all that is
required is a
prima facie
right though open to some doubt, and
that the balance of convenience should sway my decision – the
contention being that
if the order is executed without qualification
it would also involve the removal of assets owned by Crossmoor and
leave it without
the ability to generate an income. It is true that
the assets are substantial. However, I have no direct evidence as to
what impact
the execution of the court order might have on the
business of Crossmoor. ABSA also has an interest in its legal rights
being maintained.
[41]
Crossmoor only has itself to blame for its present predicament. If it
maintained regular
payments as it had agreed to make, the
ipso
facto
position of it losing the benefit of suspension of the
court order for the return of the assets would not have arisen. It
has not
adduced specific evidence as to which assets if any, over and
above those conceded by ABSA to be no longer owed by it, are assets
in respect of which ownership had passed to Crossmoor.
[42]
This court further, and in any event, has a discretion to refuse to
grant an interdict
in appropriate circumstances. In circumstances
where it was open to Crossmoor to establish, in accordance with the
agreed formula,
that what it contends is a correct appropriation of
its payments would have resulted in ownership of certain assets
passing to
it, and it failed to do so, then a plea that the execution
of the entire court order should be interdicted, cannot be
countenanced.
Conclusion
[43]
The application accordingly falls to be dismissed, not on its merits,
but because Crossmoor
has failed to discharge the onus of proof.
Crossmoor has been unsuccessful and there is no reason why it should
not be ordered
to pay the costs of the application.
[44]
The application is dismissed with costs.
KOEN
J
APPEARANCES
For the applicant:
Mr L Hollander
Instructed by:
Swartz
Weil Van der Merwe Inc
c/o Venns Attorneys
Pietermaritzburg
(Ref: N Jooste)
For the first
respondent:
Mr D Ramdhani SC
Instructed by:
Tim du Toit
Attorneys
c/o Randles Inc
Pietermaritzburg
[1]
This is per the draft order handed up at the end of the argument.
The terms correspond exactly with the relief claimed in the
notice
of motion, save that the paragraph numbering has been amended.
[2]
The application was initially pursued as one of urgency and on 20
July 2023 Mngadi J postponed the application to the date that
the
matter was heard before me and granted the relief provided in
paragraphs 1.1 and 1.2 above pending the outcome of the application
on 25 August 2023. Although the application was initially also
opposed on the basis that it should not be entertained as an urgent
application, the issue of urgency has become largely academic as
answering affidavits and replying affidavits have been filed.
This
judgement accordingly does not deal with the issue of urgency.
[3]
MEC,
Department of Public Works and Others v Ikama Architects and others
[2022] ZAECBHC 13;
2022 (6) SA 275
(ECB);
[2022] 3 All SA 760
(ECB)
para 82.
[4]
For the requirements see generally
National
Treasury and others v Opposition to Urban Tolling Alliance and
others
[2012] ZACC 18
,
2012 (6) SA 223
(CC);
2012 (11) BCLR 1148
(CC) paras
41 and 45, and
Webster
v Mitchell
1948 (1) SA 1186
(W).
[5]
The names of the parties are used rather than referring to them as
applicant and first respondent, as the papers and annexures
often
refer to them incorrectly, or as they were cited in previous
applications. It is further disappointing, having regard to
the
amount of money involved in the dispute, to note the lack of
attention with which some of the documents annexed as annexures
to
the founding papers, such as the court order, had been prepared.
[6]
This refers to the practice in this division not to make settlement
agreements wholesale orders of court, but simply the parts
thereof
sought to be enforced.
[7]
A
comparison carried out by me reveals that at least 18 assets
reflected in paragraph 3 of the court order were omitted from the
assets listed in the writ.
[8]
Footnote 7.
[9]
The relief claimed should really only be in respect of the balance
of the assets reflected in the writ, and should more correctly
be a
claim to stay the writ rather than the entire court order. That is
however not the relief claimed.
[10]
Cradle
City (Pty) Ltd v Lindley Farm 528 (Pty) Ltd
[2017] ZASCA 185
;
2018 (3) SA 65
(SCA).
[11]
Absa
Bank Ltd v The Master and others NNO
1998 (4) SA 15
(N) at 28A-C.
[12]
Coppermoon
Trading 13 (Pty) Ltd v Government, Eastern Cape Province and another
2020 (3) SA 391 (ECB).
[13]
Eke v
Parsons
[2015] ZACC 30
;
2016 (3) SA 37
(CC);
2015 (11) BCLR 1319
(CC) para
30 where the court quoted with approval
Engelbrecht
and another v Senwes Ltd
[2006] ZASCA 138
;
2007 (3) SA 29
(SCA) para 7.
[14]
HLB
International (South Africa) (Pty) Ltd v MWRK Accountants and
Consultants (Pty) Ltd
[2022] ZASCA 52
;
2022 (5) SA 373
(SCA) para 27.
[15]
Simon
NO v Air Operations of Europe AB and others
[1998] ZASCA 79
;
1999 (1) SA 217
(SCA) at 228F-I.
[16]
ABSA deals with three assets which were reflected on the writ in
respect of which the position has changed subsequent to the
issue of
the writ and indeed the issue of the application, identified as
those in respect of: First, account number 9[...], a
2017 Volvo
truck which was written off and the full amount settled by the
insurer in September 2022, making it an insurer asset;
secondly,
account number 9[...], a 2008 Mercedes Benz Axor 3595 which was
settled in full after the application was issued;
lastly, account
number 9[...], a 2008 Mercedes Benz Axor 3535 which similarly was
settled in full after the application was issued.
These assets
should not be executed against as ownership is no longer with ABSA,
but this is as a result of payments made after
the application was
issued on 4 July 2023.
[17]
Lavelikhwezi
Investments (Pty) Ltd and others v Mzontsundu Trading (Pty) Ltd and
others
[2022] ZAECMHC 6 para 23.
[18]
See
Pillay
v Krishna
1946 AD 946.
[19]
Pillay
v Krishna
at
951.