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[2024] ZAKZPHC 21
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Ramjuthan v CMH Finance and Others (5868/2022P) [2024] ZAKZPHC 21 (8 March 2024)
IN
THE HIGH COURT OF SOUTH AFRICA KWAZULU-NATAL
DIVISION, PIETERMARITZBURG
Case
No
:
5868/2022P
In
the matter between
:
SURANDRA
RAMJUTHAN
APPLICANT
And
CMH
FINANCE
1
st
RESPONDENT
PRAGASEN
NAIDOO
2
nd
RESPONDENT
BIDVEST
BIRCHMORES (PTY) Ltd
3
rd
RESPONDENT
ORDER
The
following
orde
r
is
made
:
1.
Condonation
application is refused
.
2.
The resciss
i
on
appl
i
cation is
hereby
dismissed
.
3.
The appl
i
cant
is ordered to
pay
costs of suit
JUDGMENT
N
tlokwana
AJ
Introduction
[1]
On 19 November 2022, the first respondent
obtained a court order against the applicant, cancelling the credit
agreement between
the applicant and the first respondent
and directing
that the motor
vehicle be returned to the first
respondent. This court order was because
of
a summary
judgment
application which
was granted in the absence of the
applicant.
[2]
The applicant has now brought a rescission
application to rescind the court order obtained in the summary
judgment application.
Due
to the late filing of the rescission application, the applicant is
also applying for condonation thereof.
[3]
The second and third respondent, whilst
cited herein, due to their interest in the matter, there is no relief
sought against them.
Background
[4]
The applicant is an erstwhile client of the
first respondent, who on 31 March 2018, entered into a credit
agreement for the purchase
of a vehicle, with a monthly instalment
payment of R4 492.51.
[5]
The applicant fell behind on his monthly
instalments, the first respondent issued summons on 10 May 2022,
claiming, amongst others,
confirmation of the cancellation of the
agreement and the return of the motor vehicle. The summons was served
to the applicant's
chosen address on 13 May 2022, and his daughter
received the summons on behalf of the applicant.
[6]
On receipt of the summons, the applicant
secured the services of legal representatives, SB Mkhize Attorneys
Inc. (SBM) who filed
the notice of intention to defend on 30 May
2022, and the plea was subsequently
filed
on or about 19 July 2022.
[7]
Prior to issuing the summons, on or about
31 May 2021, the applicant made an application for debt review.
Despite the debt review,
the first respondent did not receive a
payment from the applicant. On 22 April 2022, the first respondent
sent notice to terminate
the debt review to the applicant, the debt
counsellor (the second respondent), and to the National Credit
Regulator after a period
of 60 business days had lapsed. The
termination complied with
section 86(10)
of the
National Credit Act
34 of 2005
. Once the debt review was cancelled,
the first respondent alleged that it was entitled to enforce its
rights in terms of the agreement,
by cancelling the agreement and
seeking an order for the return of the vehicle.
[8]
Indeed, after the applicant's plea was
filed, the first applicant lodged a summary judgment application on
11 August 2022, set down
to be heard on 19 October 2022. The summary
judgment was served to SBM via email on 11 October 2022. In the
email,
SBM
was
advised
that
the
summary
judgment
application was
set
down
on
the
motion court roll for 19 October 2022. On the same day, the
applicant's attorneys confirmed receipt of the summary judgment
via
email.
[9]
On 19 October 2022, the applicant did not
oppose the summary judgement. The court granted the order sought,
confirming the cancellation
of the agreement and the return of the
vehicle.
[10]
On 10 November 2022
,
a warrant of de
l
ivery
for the vehicle was issued
.
and
on 19 November 2022 the sheriff served the warrant of delivery on the
applicant.
As per
the warrant of delivery
,
the
vehicle was returned to the first respondent. The first respondent
has since sold the vehicle to a third
party
.
[11]
Following the repossession of the vehicle,
the applicant lodged a rescission application on 17 February 2023.
Condonation
[12]
The first respondent alleges that the
applicant, in his affidavit, whilst seeking relief for condonation
for the late delivery of
the rescission application, has made no
factual basis for the court to consider as grounds for the relief
sought.
[13]
In
this
regard,
the
first
respondent
has
raised
a
point
in
limine
seeking
a
dismissal of the rescission application for failure to set out a
basis for condonation. The applicant acknowledged that he found
out
about the summary judgement application and
the subsequent
court order on
or
about 10 November
2022
when he was served with a copy of the warrant of delivery. At the
time, he says he was unemployed
and
had limited financial resources available, and consequently, was
unable to secure legal representation. There is no
explanation as to whether SBM were no longer available as no notice
of withdrawal
as the applicant's attorneys, nor was a termination of
mandate filed. The applicant, submitted, was only able to attend to
the
rescission application after he had secured
the services of his current attorneys of
record. This is from the reason tendered in the applicant's founding
papers as an explanation
for the late delivery of the rescission
application.
[14]
The applicant denies that he was served
with the summons and thus he was not aware of the action. According
to the applicant, he
got to know about the action on or about 8 July
2022 when a notice of bar was received by SBM, requesting the
applicant to file
a plea. The plea was filed by SBM on or about 21
July 2022.
[15]
After the plea was served to the first
respondent, the first respondent lodged the summary
judgement application. The applicant claims
that he was never personally served with the copy of the application
for summary judgement,
thus was not aware of same when it was heard
in court on 19 October 2022, when an order for summary judgement was
obtained.
[16]
The applicant further claims that, as his
debt was still under debt review, the second respondent, who was the
debt counsellor.
should have been served with the summary judgement
application. Due to non-service
to
the applicant
and
to the second respondent, the summary
judgement was obtained in both their
absence, thus the said court order was erroneously sought and/or
erroneously granted in his
absence, as provided for in
rule 42(1
)(a)
of the Uniform Rules of Court.
[17]
Whilst
the
applicant
had
also claimed
for
the
suspension
of the warrant
of
delivery, applicant's counsel correctly conceded that, as the vehicle
in question had been sold in the interim, such relief had
become
moot. Thus, what remains for consideration is condonation for late
delivery of the rescission application, as well as the
merits of the
rescission application of the summary judgement order.
[18]
In its quest for the dismissal of the
rescission application due to the applicant's failure to
make
out
a
case
for
condonation,
the
first
respondent
stated
that,
the
applicant came to know about the judgement on 10 November
2022, when the vehicle was removed from his
possession, in terms of the warranty of removal. The 20 days upon
which the applicant
should have brought the rescission application,
expired on 8 December 2022. The applicant lodged the rescission
application on
17 February 2023, according to the first respondent,
this is just more than 2 months late, and there is no satisfactory
explanation
for the delay.
[19]
The first respondent, submitted that the
applicant's allegation that he was unemployed
and thus could not afford nor obtain legal
representation at the time when the warrant of delivery was served,
falls short of the
required satisfactory basis upon which this
honourable court should grant condonation. In support of this
submission, the first
respondent pointed out that SBM were still the
applicant's attorneys on record when the warrant of delivery was
served to the applicant.
Thus, according to first respondent, the
applicant's averment that he could not afford legal representation
must fail.
[20]
On rescission of the judgement, the
applicant alleges that the judgement was both erroneously sought and
granted in his absence.
In support of this assertion, the applicant
alleges the summons and application for summary judgement were not
served on him and
accordingly did not come to his attention. Further,
that the second respondent was not joined in the proceedings. In
response,
the first respondent submitted that both the summons and
the application for summary judgement were properly served. The
applicant's
daughter received the summons at the applicant's chosen
service address, and the summary judgement application was served to
SBM,
as such, the service cannot be faulted as a basis for the
rescission application.
[21]
On the issue of non-joinder of the second
respondent, the first respondent submitted
that,
the
second
respondent
was
the
debt
counsellor.
At
the
time
of
issuing the summons, the application for debt
review was terminated and notices were served in terms of
section
86(1O)
of the
National Credit Act, thus
no error occurred when the
first respondent did
not
join the second respondent.
[22]
The
applicant
did
not
reply
to
the
first
respondent's
answering
papers
and neither heads of argument
were filed.
Issues
[23]
There are two issues to be determined, the
first, being whether condonation should be granted for the late
filing of the rescission
application and secondly, whether the
applicant has made out a case for rescission of the summary judgement
granted on 19 October
2022.
Legal
principles
[24]
According
to
rule
27(3)
of
the
Uniform
Rules,
the
court may
on
good cause shown, condone any non-compliance with the rules. The
sub-rule requires the applicant to show good cause.
It
has been held that on good cause shown, the court has a wide
discretion
[1]
which
in principle must be exercised with due regard to the merits of the
matter as a whole.
[2]
[25]
Whereas
the courts have refrained from formulating an exhaustive definition
of what constitutes good cause, two principal requirements
have
emerged for favourable exercise of the court's discretion.
[3]
The
first requirement is that the applicant should file an affidavit
explaining the delay. In
Silber
v Ozen Wholesalers (Pty) Ltd
[4]
it
was held that the explanation
of
the delay
or
default must be sufficiently
satisfactory
to
enable
the court to understand how the delay came about for the court to
access the applicant's conduct and motives. The applicant
is required
to provide a full and reasonable explanation for the entire period of
the delay.
[5]
Where
the applicant has
been
reckless in pursuit of the matter or displayed or showed intentional
disregard of the rules of
court
or
the court is
convinced
that,
the applicant
has
no
serious
intention
to proceed other than to delay the opposite
party's
claims, the court will refuse to grant the condonation
application.
[6]
[26]
The second requirement is that the applicant should establish to the
satisfaction of
the
court that he has a bona fide defence, the factual basis which if
proved, would constitute a defence.
[7]
[27]
Further to the above, prejudice is also a consideration to be taken
into account, in that, the grant of indulgence must not
prejudice the
other party, in a way where neither costs nor postponement would
compensate for the indulgence.
[8]
[28]
Relying on the provisions
rule
42(1
)(a),
the
applicant claims that the judgement was both erroneously
sought
and granted in his absence. In
Zuma
v Secretary
of
the Judicial Commission of lnquiry,
[
9]
the
Constitutional Court held that the sub-rule provided for two separate
requirements, that a party had to be absent and that the
error had to
be committed by the court.
Further,
the words 'granted in the absence of any party affected thereby'
existed to protect litigants whose presence had been precluded
and
not those who had been afforded procedurally regular judicial process
but opted to be absent.
[10]
Analysis
on condonation
[29]
The applicant by his own admission, received the summary judgement
order on 10 November 2022 when he was served with the warrant
of
delivery.
From
this date, the applicant had 20 days to file his rescission
application, thus, 8 December 2022 was the cut-off date to lodge
a
rescission application, which was ultimately launched on 17 February
2023.
The filing
therefore was more than two months late.
[30]
In explaining the reason for the delay, the applicant stated that,
due to being unemployed, with limited resources, he was
unable to
secure legal representation, it was only after he secured the
services of the current attorneys was he able to lodge
the rescission
application. This explanation presupposes that the applicant had no
legal representation. The first respondent correctly
pointed out that
the explanation that
the
application
was
launched late
due
to
the
applicant
being
unable
to
afford
legal
representation when the warrant of delivery was served, must fail on
the basis that, SBM was still on record as the applicant's
attorneys.
Even when the current attorneys lodged the rescission application,
SBM were still on record as the applicant's attorneys
as they haven't
withdrawn yet.
[31
In seeking condonation, the applicant is required to explain the
delay sufficiently to enable the court to decide as to whether
a full
and reasonable
explanation
has been provided for the entire period of the delay, including any
circumstances, which prevailed preventing the applicant
from lodging
the application during the period of the delay.
[11]
[32]
The
applicant
has
not
explained
why
SBM,
being
his
attorneys on
record
when
he got to know about the order granted on summary judgement, were not
able to prepare and lodge the rescission application,
as they were
still on record as his attorneys.
There
is
no
explanation
as
to
when
the
current
attorneys
were
instructed
to
lodge the rescission application. An assertion that, as soon as the
applicant secured the services of the current attorneys,
the said
current attorneys undertook to establish when the summary judgement
was granted is certainly not the envisaged full satisfactory
explanation of the entire period of the delay.
[12]
There
is therefore no sufficient satisfactory explanation made out for the
entire period of the delay.
[33]
Apart
from providing a satisfactory explanation, the applicant is required
to place before the court a sufficient factual basis
for establishing
that he has a bona fide defence, which if proved would constitute
defence.
[13]
In
his claim for rescission, the applicant alleges that, he was never
served with the summary judgement application personally,
nor was he
served with the summons commencing the action. He therefore had no
knowledge of the summary judgement proceedings. Further,
the
applicant submitted that the summary judgement application and the
summons should have been served to the second respondent,
a debt
counsellor, as the dispute was under debt
review.
It
was
on
this
basis
that,
the
applicant
submitted
that
the
summary
judgement granted on 19 October 2022 was both erroneously sought
and/or granted in his absence.
[34]
This is disputed by the first respondent,
stating that, the sheriff properly served summons on the applicant's
daughter, Samantha,
on 13 May 2022 at the applicant's chosen address.
Thereafter on 30 May 2022, a notice of intention to defend was filed
by SBM instructed
by the applicant on or about 27 May 2022. The first
respondent argued that if the applicant's assertion that he has never
had sight
of the papers in the main
action
was
to
be
believed,
there
is
no
explanation
how
SBM
were
appointed and on whose instructions were they able
to deliver the notice of intention to defend on behalf of the
applicant. The
allegation by the applicant that he got to know about
the main action on 8 July 2022 when SBM received a notice of bar, is
therefore
false, argued the first respondent.
[35]
Similarly, that the applicant only got to
know about the summary judgement application when the warrant of
delivery was served on
him on 1O November 2022, is a misdirection.
The summary judgement application was served to SBM by email on 11
August 2022. SBM
acknowledged receipt thereof by an email on the same
date. The applicant's counsel correctly conceded that, that was
proper service
of the summary
judgement
application on the applicant, thus there was no need for personal
service to the applicant. The first respondent argued
that the
applicant had brought the rescission application without following up
with SBM on the conduct of the matter. I agree with
this submission,
had the applicant followed up with SBM, he would have been told of
the developments leading up to the granting
of the summary judgement.
The applicant did
not
file a replying affidavit to rebut the first respondent's averments.
[36]
In
Junkeepersad
v
Solomon
[14]
it was stated that 'factors which usually weigh with a court in
considering an application for condonation include the degree of
non
compliance, the explanation therefor and an applicant's prospects of
success on the merits.' The applicant is required
to be scrupulously
accurate in his explanation statement
for
his
lack
of
promptitude
in
launching
the
rescission
application on summary judgement. This he has failed to do.
The
Constitutional Court in
Ferris
v FirstRand Bank
[15]
held
that,
'
lateness
is not the
only
consideration
in determining whether condonation may be granted. It held further
that the
test
for
condonation is
whether
it is in the interests of justice
to
grant
it.
As
the
interests-of-justice test is
a
requirement
for condonation and granting leave
to
appeal
,
there is
an overlap between these enquiries
.
For both enquiries
,
an applicant's
prospects
of success
and the importance of the issue
to be determined are relevant factors
.'
(footnotes
omitted)
[37]
The applicant has
failed
to
establish good cause as there are no prospects of success on the
merits of
the
matter.
Service of the summary judgement application
was
effected properly
,
the debt
review
process was terminated by
way
of termination notices
,
one of which was served to the second
respondent
,
thus
the second
respondent
has
no
interest
in
the matter, and consequently
,
there
was no need
to
serve
on the second
respondent.
[38]
There is no merit on the applicant's claim that the summary judgement
was erroneously sought and/or erroneously granted in
his absence,
neither is there merit on the claim that the applicant was never
served with summons. These are just delaying tactics
to resist the
finalisation of the matter with the intention to delay the first
respondent's claim. A look into the applicant's
plea filed in the
main action shows that there is no defence against the first
respondent's claim as the applicant has pleaded
that he had been
paying reduced instalments through the debt counsellor, as he was no
longer employed. This assertion is disputed
by the first respondent
stating that,
there
applicant's
plea
does
not
set
out
a
defence which
is
valid
in
law
on
the
basis
that
the
debt
review
order
had
been
dismissed,
and
at
no
stage
did
the
first
respondent agree
to reduce payment. The first respondent further stated that such was
not necessary
as
the debt review was terminated
at
the time
when the
summons
was
lodged.
[39]
The applicant has failed to make out a case for condonation, thus the
application
should
be refused. During
the
hearing,
first respondent's
counsel
was emphatic that, if the court were to
conclude that condonation is
refused,
the matter should be dismissed with costs for failure to
make out a case for condonation.
Costs
[40]
It
is
trite law that the
costs
shall follow the
event,
of
course with
the discretion of the
court.
The first
respondent
has been successful in opposing the matter and there is
no
reason
to
deprive
the
first
respondent
of
the
cost
of
suite
as
prayed
in
its
answering
affidavit
as
well
as
on
the
submissions
made
by
counsel
to
dismiss
the
application with costs if the condonation is not granted.
Order
[41]
The following order is made:
1.
Condonation application is refused.
2.
The rescission application is hereby dismissed.
3.
The applicant is ordered to pay costs of suit.
Ntlokwana
AJ
APPERANCE
DETAILS:
For
the Applicant:
BC Houson
Instructed
by:
Keowan Reddy Incorporated
For
the 1
st
Respondent: Anderton
Instructed
by:
Allen Attorneys Inc
Matter
heard on:
7 November
2023
Judgment
delivered on: 8 March 2024
[1]
Du
Plooy v Anwes Motors (Edms) Bpk
1983
(4) SA 212
(0)
at
216H -
217A.
[2]
Gumede
v Road Accident Fund
2007
(6) SA 304
(C) paras 7-8.
[3]
Dalhouzie
v Bruwer
1970
(4) SA 566
(C) at 571F -
572C
(Dalhouzie).
[4]
Silber
v Ozen Wholesalers (Pty) Ltd
1954
(2) SA 345
(A) at 353A.
[5]
Van
Wyk v Unitas Hospital and another (Open Democratic Advice Centre as
amicus curiae)
[2007] ZACC 24
;
2008
(2) SA 472
(CC) para 22
(Van
Wyk);
see
also
lngosstrakh
v Global Aviation Investments (Ply} Ltd and others
(2021)
ZASCA 69
;
2021 (6) SA 352
(SCA)
para
21
(lngosstrakh).
[6]
Standard
General
Insurance
Co
Ltd
v
Eversafe
(Pty) Ltd and others
2000
(3) SA 87
(W) para 15;
Smfth
NO v Brummer NO and another Smith, NO v Brummer
1954
(3) SA 352
(0)
at
358A.
[7]
Dalhouzie.
[8]
Dalhouzie
at
5720.
[9]
Zuma
v Secretary of the Judicial Commission of Inquiry into A/legations
of State Capture, Corruption and Fraud in the Public Sector
Including Organs of State and
others
2021
(11)
BCLR 1263
(CC)
(Zuma).
[10]
Zuma
paras
56-57.
[11]
Silber
v Ozen.
[12]
Van
Wyk
para
22 and
lngosstrakh
para
21.
[13]
Dalhouzie.
[14]
Junkeeparsad
v
Solomon and
another[2021]
ZAGPJHC 48 para 7.
[15]
Ferris
and another v FirstRand Bank Ltd
[2013] ZACC 46
;
2014 (3) SA 39
(CC)
para 10.