Matsopa Local Municpality v EMS Solutions (Pty) Ltd (2527/2020) [2022] ZAFSHC 60 (23 March 2022)

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[2022] ZAFSHC 60
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Matsopa Local Municpality v EMS Solutions (Pty) Ltd (2527/2020) [2022] ZAFSHC 60 (23 March 2022)

IN THE HIGH
COURT OF SOUTH AFRICA
FREE STATE
DIVISION, BLOEMFONTEIN
Application
number:   2527/2020
In the application
between:
MANTSOPA LOCAL
MUNICIPALITY
Applicant
and
EMS SOLUTIONS
(PTY) LTD
Respondent
CORAM:
VAN ZYL, J
HEARD
ON:
29 OCTOBER 2021
DELIVERED
ON:
23 MARCH 2022
[1]
This is an application for leave to appeal by the applicant (the
respondent
in the main application) against the following order which
I granted in favour of the respondent (the applicant in the main
application):
“
1.
The respondent is to pay the applicant an amount of R4 942 984.03.
2.
The respondent is to pay the applicant interest on the
respective
arrear amounts a prime rate plus 2 (two) percent per annum,
calculated daily and compounded monthly, calculated from the
date on
which the respective arrear amounts became due and payable, until
date of final payment.
3.
The respondent is ordered to pay the costs of the application.”
[2]
For the sake of efficacy I will refer to the parties as “
the
Municipality
” and “
EMS
” respectively.
The test to be
applied in an application for leave to appeal:
[3]
In terms of section 17(1)(a)(i) of the Superior Courts Act, 10 of
2013 (“the
Act”), leave to appeal may only be given where the
judge concerned is of the opinion that “
the appeal would have a
reasonable prospect of success
”.  In the unreported
judgment of
The Mont Shevaux Trust (IT 2012/28) v Tina Goosen,
case no. LCC14R/2014, dated 3 November 2014, the court pronounced as
follows regarding the test that now has to be applied before
leave to
appeal should be granted:
“
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.”
[4]
Regarding the requirement of “
a reasonable prospect of success”
the Supreme Court of Appeal interpreted it as follows in
S
v Smith
2012 (1) SACR 567
(SCA) at para [7]:
“
What the test of
reasonable prospects of success postulates is a dispassionate
decision, based on the facts and the law that a court
of appeal could
reasonably arrive at a conclusion different to that of the trial
court.  In order to succeed, therefore, the
appellant must
convince this court on proper grounds that he has prospects of
success on appeal and that those prospects are not
remote, but have a
realistic chance of succeeding.  More is required to be
established than that there is a mere possibility
of success, that
the case is arguable on appeal or that the case cannot be categorised
as hopeless.  There must, in other words,
be a sound, rational
basis for the conclusion that there are prospects of success on
appeal.”
See also
Four
Wheel Drive
Accessory Distributors CC v Rattan N.O.
2019 (3) SA 451
(SCA);
S
v Rohde
2020 (1) SACR 329
(SCA).
Ad
merits:
[5]
The grounds of the application for leave to appeal are stated to be
the
following:
“
1.
The Honourable Court erred when it found that the applicant did not
deny existence
of contract for the periods mentioned therein. (
sic
)
[para 20]
2.
The Honourable Court erred when it found that the affidavit of the
respondent constitutes a bare denial.  The answering affidavit
lacked support of evidence.  [para 23]
3.
The Honourable Court erred when it deemed it unnecessary to deal with
an unsigned acknowledgment of debt.  The applicant in court
a
quo
attached it as evidence although it was unsigned.  [para
25]
4.
The Honourable Court erred in awarding costs to the applicant.
[para 27]
5.
The Honourable Court erred in finding that the applicant failed to
prove the amount owing due to insufficient evidence. (
sic
)
[para 28]”
First ground:
[6]
I have duly dealt with this aspect in paragraphs [19], [20] and [21]
of
my judgment in the main application.
Second ground:
[7]
Mr Motloung, who appeared on behalf of the Municipality in the
hearing of
the application for leave to appeal, submitted that the
Municipality was unable to provide any factual allegations in support
of
their denials in the answering affidavit, due to the fact that EMS
failed to provide factual allegations in support its case in the
founding affidavit. I cannot agree with this contention.  From a
mere reading of the founding affidavit it is evident that EMS
indeed
provided factual allegations in its founding affidavit in support of
its case.  The Municipality, on the other hand,
failed to
provide any factual allegations in support of its denials.
[8]
Mr Motloung’s contention that the Municipality would have dealt
with the
evidence had the matter been referred for oral evidence,
does clearly not hold water.  A matter is referred for oral
evidence
in circumstances where there are
bona fide
and
substantial factual disputes between the parties which cannot be
adjudicated on the papers.  However, such factual disputes
can
only exist on the papers when both parties advanced facts in their
affidavits in support of their allegations.  In
casu
the
Municipality failed to do so.  The Municipality`s failure to
have done so, cannot be rectified by providing the Municipality
an
opportunity to, for the first time, present such facts/evidence by
referring the matter for oral evidence.
Third ground:
[9]
Although EMS attached the unsigned acknowledgment of debt to its
founding
affidavit, the fact remains that the said acknowledgment of
debt does not constitute EMS`s cause of action.  There was
consequently
no reason for me to have dealt with the unsigned
acknowledgment of debt, as explained in paragraph [25] of my judgment
in the main
application.
Fourth ground:
[10]
Considering the outcome of the main application, there was no reason
why the
costs were not to follow the success of the application.
Fifth ground:
[11]
In support of this ground, it was on the one hand, argued on behalf
of the Municipality
that EMS failed to attach the invoices it relies
on in support of its cause of action to the founding affidavit.
However, when
it was appointed out that EMS indeed attached a
schedule of invoices to its founding affidavit, it was contended on
behalf of the
Municipality that the mere attachment of invoices does
not constitute proof of indebtedness.
[12]
The mere attachment of invoices to the founding affidavit does indeed
not constitute
proof of indebtedness.  However, those invoices
are to be considered in conjunction with the factual allegations made
by EMS
in the founding affidavit pertaining to its appointment by the
Municipality as a Professional Service Provider for and in respect
of
the 2016/2017, 2017/2018 and  2018/2019 financial years, which
was admitted by the Municipality.  It is further to be
read in
conjunction with EMS ’s allegation that it duly rendered the
services and carried out all its other obligations under the
agreements and rendered invoices in respect of the services.  In
addition to the aforesaid, EMS also alleged as follows in paragraphs
4.4 and 4.5 of its founding affidavit:
“
4.4
The respondent accepted the services rendered by the applicant as
being in accordance with
the terms of the agreements in all respects,
and accepted the invoices as per annexure ‘D’ without query or
objection, but to
date has made payment to the applicant only in
part.
4.5
Also reflected in annexure ‘D’ are the payments made by and
received from
respondent, to date hereof.
4.6
The respondent has to date failed and/or refused to make payment to
the applicant
of the outstanding invoices.”
[13]
In response to the aforesaid factual allegations, the Municipality
denied the
allegations and merely alleged that the “
applicant
had failed to render services as per the agreement
”, that “
an
invoice is not proof of indebtedness
” and that it is “
the
submission
of the respondent that partial
payment would be an indication that the service was not carried out
fully
”. No facts allegations whatsoever were advanced by the
respondent in support of its aforesaid denials.
CONCLUSION:
[14]
In my view there is no basis upon which a reasonable prospect exists
that another
court would come to a different conclusion in the main
application.
[15]
The application for leave to appeal can consequently not succeed and
there is
no reason why costs should not follow the outcome of the
application.
Order:
[16]
The following order is made:
1.
The application for leave to appeal is dismissed.
2.
The applicant in the application for leave to
appeal, Mantsopa Local Municipality, is to pay the costs of the
application.
C.
VAN ZYL, J
On behalf of the
applicant:       Adv. SE Motloung
Instructed by
:
Seobe Attorneys
BLOEMFONTEIN
On behalf of the
respondent:    Mr. R. Green
Instructed by:
Green Attorneys
BLOEMFONTEIN