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2022
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[2022] ZAFSHC 155
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Richard Keay Pollock N.O and Others v Victor and Others (7352021) [2022] ZAFSHC 155 (17 June 2022)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number: 7352021
Reportable:
YES/NO
Of
Interest to other Judges: YES/NO
Circulate
to Magistrates: YES/NO
In
the matter between:
RICHARD
KEAY POLLOCK N.O.
1
st
Applicant
MOHAMMED
YASEEN KHAMISSA N.O.
2
nd
Applicant
LINDIWE
FLORENCE KAABA N.O.
3
rd
Applicant
and
VAUGHN
VICTOR
1
st
Respondent
MARIA
MAGDALENA CATHARINA VICTOR
2
nd
Respondent
WONDERHOEK
FARMS (PTY) LIMITED
3
rd
Respondent
RODGER
HERNRY WILMOT
4
th
Respondent
S.A.
AUCTION (PTY) LIMITED
5
th
Respondent
THE
SHERIFF FOR THE DISTRICT OF WEPENER
6
th
Respondent
MAGISTRATE
SEBE N.O.
7
th
Respondent
THE
CHIEF MAGISTRATE FOR BLOEMFONTEIN
MAGISTRATE’S
COURT
N.O.
8
th
Respondent
CORAM:
LOUBSER,
J et DE KOCK, AJ
HEARD
ON
: 6
JUNE 2022
JUDGEMENT
BY
:
LOUBSER, J
DELIVERED
ON:
17 JUNE 2022
[1]
In this application the Applicants seek an order reviewing and
setting aside an order
made by the Seventh Respondent on 12 February
2021 under case number 19/2020 in the Magistrate’s Court for
the district of
Wepener. The Applicants are the joint liquidators of
a company by the name of Rohallion Farms (Pty) Limited, which company
was
finally placed in liquidation by the Johannesburg High Court on
31 July 2018.
[2]
The First Respondent is an unrehabilitated insolvent and an erstwhile
director of
Rohallion and the Third Respondent, Wonderhoek Farms
(Pty) Limited. Wonderhoek owns a number of farms,
inter alia
the farm Aanvang 1 in the district of the Wepener, where the First
Respondent and his wife, the Second Respondent reside. Rohallion
was
the operating company through which the farming operations on the
farms owned by Wonderhoek were conducted, but it never owned
any
fixed property.
[3]
More recently, and until 2014, the First Respondent became a senior
manager of Rohallion
and he was then responsible for all the
day-to-day activities of Wonderhoek and Rohallion. He was also
entrusted with the assets
of the two companies. As will be seen later
hereinafter, the First Respondent played a pivotal role in the events
that caused the
present application to be launched.
[4]
On the basis of allegations that the First Respondent had removed
assets of Rohallion
worth millions of Rands from the farm Aanvang 1
to an adjacent farm owned by the Fourth Respondent, and on the basis
of allegations
that the First and Second Respondents were renting
that adjacent farm from the Fourth Respondent, the Applicants decided
to approach
the Wepener Magistrate’s Court on 11 December 2021
for a warrant in terms of Section 69(2) and 69(3) of the Insolvency
Act.
[1]
They did so because Section 69 obliges the liquidators, as soon
as possible after their appointment, to take into possession
or under
their control all movable property, books and documents belonging to
the insolvent estate. In terms of section 69(2) of
the Act, if a
trustee or liquidator has reason to believe that any property, book
or document is concealed or otherwise unlawfully
withheld, he may
apply to the Magistrate having jurisdiction for a search warrant
mentioned in Section 69(3). Once such a warrant
is issued, it confers
authority on the person executing it to search for and take
possession of the property concerned and to deliver
any article
seized thereunder to the trustee.
[2]
The Applicants approached the Magistrate on 11 December 2021
ex
parte
,
and the warrant was issued by order returnable or 19 February 2021.
[5]
On 18 December 2021 the First Respondent, opposing the order,
anticipated the return
date of the order, and eventually the matter
came before the Seventh Respondent on 29 January 2021. After hearing
arguments by
both counsel for the Applicants and the First
Respondent, the Seventh Respondent postponed the matter to 12
February 2021. On that
day, he dismissed the application for a
warrant on an attorney and client scale.
[6]
The Notice of Motion in the present application consists of a Part A
and a Part B.
In Part A it is prayed that the Fifth and Sixth
Respondent be interdicted from releasing the goods to the First,
Second, Third
or Fourth Respondents attached pursuant to the warrant
issued on 11 December 2020 pending the final determination of the
relief
sought in Part B. In the alternative, it is prayed in Part A
that the goods so attached, be held and retained under the
attachment.
In Part B the review and the setting of the proceedings
before the Seventh Respondent is sought. Before us, counsel appearing
for
the Applicants requested the Court to only grant the relief
sought in Part B, saying that the relief sought in Part A is no
longer
sought by the Applicants.
[7]
It is the proceedings of 29 January 2021 and the subsequent order
dismissing the application
on 12 February 2021 that exclusively form
the basis for this review application. Apart from the main relief
sought, certain ancillary
relief is also sought by the Applicants,
namely that the matter be referred back to the Magistrate’s
Court of Wepener to
be heard de novo by a Magistrate other than the
Seventh Respondent.
[8]
Now the grounds for a review of proceedings in a Magistrate’s
Court are clearly
regulated by Section 22(1) of the Superior Courts
Act
[3]
in the following words:
“
(1)
The grounds upon which the proceedings of any Magistrate’s
Court may be brought under review before a Court of a Division
are –
(a)
absence of jurisdiction on the part of the
court;
(b)
interest in the cause, bias, malice
or corruption on the part of the presiding judicial officer;
(c)
gross irregularity in the proceedings; and
(d)
the admission of inadmissible or
incompetent evidence or the rejection of admissible or competent
evidence.
(2)
This section does not affect the provisions of any other law relating
to the review
or proceedings in Magistrate’s Courts.”
[9]
It speaks for itself that if any of these grounds are found to be
present in the instant
case, this Court will be competent to
interfere and to review the decision in question and to set it aside.
[10]
Before the proceedings of 29 January 2021 and 12 February 2021 are
dealt with in more detail,
the following needs mentioning: The
Seventh Respondent has filed a Notice to Abide by the decision of
this Court, and he therefore
does not oppose the application for a
review. Furthermore, the First Respondent and the Second Respondent
have filed a counter
application in response to the main application,
calling for an order that the Applicants and the Fifth and the Sixth
Respondent
be ordered to immediately comply with the Court order of
the Seventh Respondent dated 12 February 2021, namely to return the
movable
assets that were removed by the Fifth Respondent on 11 and 12
December 2020 at the farm Aanvang 1 and its adjacent farm to the
First and Second Respondents. In addition, an order is sought in the
counter-application to the effect that the Applicants should
be found
to be in contempt of court for their failure to return the assets so
seized after the dismissal of the application for
a warrant on 12
February 2021. A further order is sought that the Applicants be
committed to imprisonment for a certain period
for their contempt of
court. Whereas a review application is normally heard by two Judges,
and whereas a contempt application is
normally heard by a single
judge, the Acting Judge President of this Division granted leave that
the contempt application be heard
together with the review
application by the two Judges of review.
[11]
I now turn to the events of 29 January 2021 when the Seventh
Respondent heard submissions by
the respective counsel pertaining to
the order authorizing a search warrant dated 11 December 2020. This
Court has been provided
with a full transcribed record of the
proceedings of 29 January 2021 and 12 February 2021, and consequently
the record can be accepted
as a true reflection of what transpired in
the Court on those two days.
[12]
The record makes it clear that the First Respondent raised three
points
in limine
and also dealt with the merits of the Section
69 application in his answering affidavit anticipating the return
date. In Heads
of Argument subsequently filed by the Applicants, the
three points in limine raised in the answering affidavit and the
merits of
the application where duly addressed. Pursuant to the
filing of these Heads, the Heads on behalf of the First and Second
Respondents
were then filed in reply. In these Heads, the Respondents
also dealt with the three
points in limine
and the merits of
the applications as raised in the answering affidavit. The Heads went
further, however, to raise a further and
fourth point
in limine
which was not raised in the answering affidavit at all. This point
contended that the Magistrate’s Court lacked the necessary
jurisdiction to issue a warrant in terms of Section 69, since the
Applicants should have used the remedies provided for in the
Companies Act 61 of 1973.
[13]
Upon receipt of the Heads of Argument raising this fourth point
in
limine,
the Applicants were quick to file further Heads of
Argument wherein it was submitted that the Court could not determine
the fourth
point
in limine
as it had not been raised in the
answering affidavit. In these Heads, the Applicants referred to a
number of authorities in support
of their argument.
[14]
On the day of the hearing, namely on 29 January 2021, counsel
appearing for the Applicants only
made submissions relating to the
admissibility of the fourth point
in limine,
and he requested
the following. “We want Your Worship to make a finding to the
effect that the issue raised by my colleague
… cannot be
raised in this Court.” He did not deal with the remaining
three points
in limine
or the merits of the application. In
his subsequent address to the Court, counsel appearing for the First
and Second Respondents,
also focused on the question whether the
fourth point
in limine
should be allowed or not. He submitted
that the fourth point entailed a point of law, and that a point of
law can be raised at
any time during proceedings.
[15]
The Seventh Respondent then indicated that he would require at least
a week to finalize “the
point in limine raised”,
whereupon council for the Applicants had the following to say: “May
I make a suggestion that
we postpone until the 12
th
because whatever happens we can carry on if Your Worship is against
me. Maybe that will give you a bit more time and then, you
know, we
have got the whole day to continue whatever and I see my colleagues
says it is fine.” Counsel for the First and
Second Respondents
confirmed that he had no objection.
[16]
The Seventh Respondent then adjourned the matter to the 12
th
of February 2021 “for the Court to make a ruling on the fourth
point
in limine
raised”. Now having regard to what was
said by everybody concerned in the Court on the day in question, it
is patently clear
to this Court that it was understood and agreed by
all, including the Seventh Respondent, that the Court would only make
a ruling
on 12
th
February 2021 as to whether the First and
Second Respondents would be allowed to raise the fourth point
in
limine
or not.
[17]
On 12
th
February 2021 the Seventh Respondent, however, not
only dismissed the submission that the fourth point
in limine
should not be allowed, but he went further to uphold the fourth point
of no jurisdiction, seemingly on different grounds than those
raised
in the fourth point, with costs on the attorney and client scale. In
coming to this conclusion, he also dealt with the merits
of the
application in general. He did so without hearing the Applicants on
the merits of the fourth point
in limine
or on the question of
jurisdiction, and without hearing the Applicants on the merits of the
application as a whole.
[18]
Before us, Mr. Ferreira appearing for the First and Second
Respondents, submitted that the application
for a review should be
dismissed because the Applicants should have made use of the appeal
procedure. This is so, the argument
went, since the Seventh
Respondent had
mero motu
decided the jurisdiction issue on
different grounds than those raised in the fourth point, as he was
entitled to do in law. This
approach by the Seventh Respondent called
for an appeal in the circumstances, and not a review. I do not agree.
While there may
be merit in the submission generally, the fact
remains that in this case, there was a clear understanding between
the Seventh Respondent
and the respective counsel on 29 January 2021
that the Seventh Respondent would only make a ruling on the
admissibility of the
fourth Point on 12 February 2021, and nothing
more. By proceeding beyond that issue on 12 February 2021, counsel
for the Applicants
was denied the opportunity to address the Court on
the aspect of jurisdiction before the Court made its final decision.
[19]
Section 34 of the Constitution guarantees a right to a fair hearing.
The Constitutional Court
formulated this right unanimously in
De
Beer N.O. v North Central Local Council etc
[4]
as follows: “A fair hearing before a Court as a prerequisite to
an order being made against anyone is fundamental to a just
and
credible legal order. Courts in our country are obliged to ensure
that the proceedings before them are always fair. Since procedures
that would render the hearing unfair or inconsistent with the
Constitution, Courts must interpret legislation and Rules of Court,
where it is reasonably possibly to do so, in a way that would render
the proceedings fair. It is a crucial aspect of our law that
Court
Orders should not be made without affording the other side a
reasonable opportunity to state their case.”
[20]
It follows that the proceedings under scrutiny were irregular in so
far as the Seventh Respondent
went beyond the understanding that he
would only make a ruling as to whether the fourth point
in
limine
could be argued or not. He in fact upheld the fourth point, or the
one on jurisdiction, without hearing the Applicants thereon
and on
the merits of the application as a whole. This irregularity qualifies
as a gross irregularity as envisaged by Section 22(1)(c)
of the
Superior Court Act
[5]
because it caused prejudice to the Applicants and because it denied
the Applicants a fair hearing. This court is therefore obliged
to
interfere in favour of the Applicants.
[21]
It further follows that the counter application for the return of the
goods and for contempt
cannot succeed. The Applicants and the
Respondents concerned cannot incur any liability upon a Court Order
that was based on an
irregular and unfair procedure.
[22]
Counsel for the First and Second Respondents also urged us to dismiss
Part A of the Notice of
Motion with costs on the punitive scale since
the relief sought in that Part caused the Respondents to respond
thereto in the application
papers, and now the Applicants have simply
abandoned the relief sough in Part A. Again, I do not agree.
Correspondence before us
indicate that Part A was included in the
Notice of Motion because the attorney for the First and Second
Respondents had threatened
to launch an urgent application for the
release of the goods attached, pursuant to the order of the Seventh
Respondent on 12 February
2021. This urgent application never
materialized, afterwards or at any stage, and it is for that reason
that the Applicants have
decided not to continue seeking the relief
set out in Part A. In my view there should therefore be no order as
to costs as far
as Part A is concerned.
[23]
As for the remaining costs, I can find no reason why the Applicants
should be out of pocket in
circumstances where a clear and gross
irregularity in the proceedings of the Magistrate’s Court has
occurred. The following
orders are therefore made:
1.
The order of the Seventh Respondent, dated 12 February 2021 under
case number
19/2020 in the Magistrate’s Court for the District
of Wepener, is hereby reviewed and set aside.
2.
The matter is referred back to the Magistrate’s Court for the
District
of Wepener to be heard
de novo
by a Magistrate other
than the Seventh Respondent
3.
The First and Second Respondents are ordered to pay the costs of the
application
for review jointly and severally on an attorney and
client scale.
4.
The counter application is dismissed with costs on an attorney and
client scale,
to be paid by the First and Second Respondents jointly
and severally.
5.
Part A of the Notice of Motion is dismissed, with no order as to
costs.
P.
J. LOUBSER, J
I
concur:
D.
DE KOCK, A.J.
For
the Applicants: Adv.
J. W. Kloek
Instructed
by: Esthe
Muller Inc. Northcliff
c/o
MDP Attorneys,
Bloemfontein
For
the Respondents:
Adv. E. J. Ferreira SC and
Adv.
F. G. Janse van Rensburg
Instructed
by: LB
Attorneys
c/o
McIntyre van der Post
Bloemfontein
[1]
Act 24 of 1936, as amended
[2]
Section 69(3) read with Section 69(4)
[3]
Act 10 of 2013
[4]
[2001] ZACC 9
;
2002 (1) SA 429
(CC) at para 11
[5]
Supra