Greensek (Pty) Ltd v De Jager and Others (5201/2018) [2022] ZAFSHC 177 (19 July 2022)

80 Reportability
Civil Procedure

Brief Summary

Execution — Stay of execution — Urgent application for stay of execution of warrant pending interpleader proceedings — Applicant contending that attached assets do not belong to the judgment debtor and are subject to competing claims — Court finding that real and substantial justice requires a stay of execution to prevent potential injustice — Application granted.

Comprehensive Summary

Summary of Judgment


1. Introduction


This matter concerned an urgent application brought in the Free State Division of the High Court, Bloemfontein, seeking interim relief to stay execution under a warrant and to cancel a sale in execution that was imminent. The application was brought in terms of Rule 6(12) of the Uniform Rules of Court, and was framed as relief pending the final adjudication of interpleader proceedings under the same case number.


The applicant was Greensek (Pty) Ltd, a private company. The first respondent was Tarita De Jager, who opposed the application. The second respondent was the Sheriff (Molifi Aaron Matsoso N.O.), cited in an official capacity. The third respondent (Pieter Janse de Jager) and the fourth respondent (Wilhelmina Petronella Pretorius) were cited, but no substantive relief was sought against them.


The dispute arose from enforcement steps taken by the first respondent pursuant to obligations flowing from a divorce settlement agreement made an order of court. In execution of the first respondent’s claims, the Sheriff attached movable items. The applicant contended that a number of the attached movables belonged to it, and that its ownership claim was already the subject of interpleader proceedings. The urgent application sought to prevent the sale of those attached items before the ownership dispute could be determined in the interpleader proceedings.


Procedurally, the interpleader proceedings had previously been enrolled but were removed from the roll due to non-appearance by claimants. The applicant later re-enrolled the interpleader for hearing and, upon receiving notice that the sale in execution would proceed, approached the court urgently for a stay and cancellation of the scheduled auction.


2. Material Facts


The court treated the following facts as material to the urgent relief sought.


The undisputed procedural background was that Mr and Mrs De Jager were divorced on 23 May 2019, and their deed of settlement was made an order of court. Mrs De Jager alleged that Mr De Jager was in arrears in relation to obligations under that settlement and, in pursuit of enforcement, obtained a warrant pursuant to which the Sheriff attached movable property on 13 August 2021. The Sheriff subsequently issued an interpleader notice on 31 January 2022, calling upon claimants to deliver particulars of their claims by 11 March 2022.


The applicant, through an affidavit deposed to by a director, asserted that various attached items were the property of the applicant, including (as described in the judgment) livestock and items such as a compressor and tools. The interpleader proceedings were enrolled for hearing on 22 April 2022, but none of the claimants appeared, and the interpleader application was removed from the roll.


On 3 June 2022, the applicant received a notice that the attached items would be sold in execution on 25 June 2022 at 13h00. The applicant’s attorneys corresponded with the first respondent’s attorneys from 7 June 2022 onwards, requesting that the sale not proceed and indicating that urgent relief would be sought if the sale was not cancelled. After the applicant did not receive confirmation of cancellation, it brought the urgent application shortly before the scheduled sale.


A central point of contest was whether urgency was self-created. The first respondent argued that the applicant waited too long and then sought relief on very short notice. The court, however, accepted the explanation that delay was linked to attempts to resolve the issue through correspondence and an apparent misunderstanding about whether the sale would be cancelled.


A further dispute raised by the first respondent was that the applicant was allegedly claiming assets not under attachment and had not shown any right to the attached items. The first respondent also suggested that the application formed part of an attempt, attributed to Mr De Jager and others, to delay execution. The court did not decide the substantive ownership disputes within this urgent application, treating them as properly belonging to the pending interpleader proceedings.


It was additionally material that the applicant re-enrolled the interpleader proceedings for hearing on 18 July 2022, i.e., within approximately a month of the urgent application, and relied on that impending determination to justify interim protection against the sale.


3. Legal Issues


The central legal questions were whether the court should, as an urgent measure, stay execution and cancel the sale in execution pending the outcome of interpleader proceedings, and whether the applicant had satisfied the requirements for urgent relief under Rule 6(12).


The matter primarily involved the application of legal principles to largely common-cause procedural facts—namely, the existence of execution steps, an interpleader process that had been initiated and then removed from the roll, and a scheduled sale in execution. It also involved the court’s discretionary value judgment as to whether “real and substantial justice” required a stay of execution, and whether injustice would otherwise result if execution proceeded before the interpleader could be adjudicated.


A subsidiary legal issue was the first respondent’s contention that, because claimants did not appear when the interpleader was previously enrolled, no interpleader proceedings were pending, and that the claimant’s non-compliance could have attracted consequences under Rule 58(5). Against this, the applicant’s position was that no barring order had been made under Rule 58(5) and that the interpleader had been re-enrolled, so that it remained appropriate to preserve the property pending that determination.


4. Court’s Reasoning


On urgency, the court approached the matter under Rule 6(12), which permits departure from ordinary forms and time periods where a litigant cannot obtain substantial redress in due course. The court accepted that the sale was scheduled for the following day, and that the applicant’s explanation for the timing—ongoing efforts to resolve the issue through correspondence and a misunderstanding as to whether the sale would be stopped—was sufficient. The court therefore condoned non-compliance with ordinary service and time periods and dealt with the merits.


On the stay of execution, the court relied on the principle that execution is a process of court and that a court has an inherent power to control its own process, including a discretion to set aside or stay a writ or warrant of execution. The judgment referred to the formulation that a stay is generally granted where real and substantial justice requires it, or where injustice would otherwise occur. The court treated this discretion as particularly relevant where the execution process risked disposing of property that is the subject of an ownership dispute raised by third parties.


The court also referred to the interpleader framework under Rule 58, including the understanding that interpleader proceedings are designed for situations where the Sheriff alleges that two or more parties make adverse claims to attached property. In addressing the first respondent’s argument that the applicant had failed to comply with Rule 58 and that the removal from the roll meant the interpleader was no longer pending, the court accepted the applicant’s response that no barring order had been granted under Rule 58(5) and that the interpleader had been re-enrolled for hearing on 18 July 2022. The court therefore did not accept that the applicant’s claim had been extinguished or that interpleader relief was no longer in play.


Importantly, the court emphasised that the urgent application was not the proper forum to adjudicate the substantive ownership claims to the attached items. The court accepted that the interpleader proceedings were the mechanism through which such claims should be tested and determined, and it considered it potentially unjust to permit a sale in execution to proceed where the applicant had raised a bona fide ownership claim and the interpleader hearing was imminent.


In applying these principles to the facts, the court accepted that if the sale in execution proceeded, assets allegedly owned by a third party claimant (including the applicant) might be sold before the interpleader court could determine the adverse claims. The court concluded that, on these facts, real and substantial justice justified a temporary stay of execution pending the interpleader determination, particularly given that the interpleader was to be heard within about a month.


On costs, the court acknowledged sympathy for the first respondent’s position in pursuing compliance with maintenance obligations and settlement terms. However, it applied the general principle that costs follow the result, and found no reason to depart from that rule in the urgent application.


5. Outcome and Relief


The court granted urgent interim relief. It ordered that the matter be heard as urgent in terms of Rule 6(12) and condoned non-compliance with ordinary service and time limits. It ordered that the warrant of execution issued on 22 April 2022 be stayed pending the final adjudication of the interpleader proceedings under the same case number. It further ordered that the sale in execution advertised for 25 June 2022 at 13h00 be cancelled.


The court ordered that the first respondent pay the costs of the urgent application.


Cases Cited


Chase & Sons (Pty) Ltd v Tecklenburg 1957 (3) SA 51 (T).


Strime v Strime 1983 (4) SA 850 (CPD).


Williams v Garrick 1938 TPD 147.


Graham v Graham 1950 (1) SA 655 (T).


Cohen v Cohen 1979 (3) SA 420 (R).


Van Rensburg and Another NNO v Naidoo and Others NNO; Naidoo and Others NNO v Van Rensburg NO and Others 2011 (4) SA 149 (SCA).


Legislation Cited


No legislation was cited in the judgment beyond the Uniform Rules of Court framework governing urgency and interpleader procedure.


Rules of Court Cited


Uniform Rules of Court, Rule 6(12).


Uniform Rules of Court, Rule 58 (including Rule 58(5) and Rule 58(7)).


Held


The court held that the application was properly enrolled and heard as an urgent application, because the applicant faced the imminent sale in execution of items it claimed to own, and substantial redress could not be obtained in due course if the sale proceeded.


The court held further that, given the pending (and re-enrolled) interpleader proceedings, it was appropriate in the interests of real and substantial justice to stay the warrant of execution and cancel the scheduled sale in execution pending final determination of the interpleader claims. The court treated the ownership disputes as matters for the interpleader forum and not for final decision in the urgent stay application.


The court held that the ordinary rule on costs should apply, and therefore ordered costs against the first respondent as the unsuccessful party in the urgent application.


LEGAL PRINCIPLES


A High Court has an inherent power to control its own process, including a discretion to stay execution where real and substantial justice requires it and where injustice would otherwise be done if execution proceeds.


Under Rule 6(12), urgent relief may be granted where an applicant shows that it cannot obtain substantial redress in due course; imminent execution and sale may justify the court’s urgent intervention, including condonation for non-compliance with ordinary time periods and service requirements.


Interpleader proceedings under Rule 58 provide the procedural mechanism to resolve adverse claims to attached property, and the urgent stay application is not the forum for determining substantive ownership disputes that are properly reserved for the interpleader determination.


Non-appearance at an enrolled interpleader hearing does not, without more, equate to final barring of the claim; the consequences contemplated by Rule 58(5) depend on the making of an appropriate court order, and the existence of re-enrolled interpleader proceedings may support interim protection against sale pending adjudication.

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[2022] ZAFSHC 177
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Greensek (Pty) Ltd v De Jager and Others (5201/2018) [2022] ZAFSHC 177 (19 July 2022)

IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Case
no
.
5201/2018
Reportable:
YES/NO
Of
Interest to other Judges: YES/NO
Circulate
to Magistrates: YES/NO
In
the matter between:
GREENSEK
(PTY) LTD
Applicant
and
TARITA
DE JAGER
First Respondent
MOLIFI
AARON MATSOSO N.O
.

Second Respondent
PIETER
JANSE DE
JAGER
Third

Respondent
WILHELMINA
PETRONELLA PRETORIUS
Fourth Respondent
CORAM:

VAN RHYN, J
HEARD
ON:
24 JUNE 2022
REASONS
FOR ORDER MADE ON 24 JUNE 2022
(Delivered
by email to the parties’ legal representatives and by release
to SAFLII. The reasons shall be deemed to have been
handed down at
10h00 on 19 July 2022)
[1]
On 24 June 2022 I made an order in the following terms in this
matter, which came
before me as an urgent application:

It
is ordered that:
1.
This application is heard as an urgent
application in terms of the provisions of Rule 6(12) of the Uniform
Rules of Court and the
non-compliance pertaining to service and time
periods is condoned.
2.
The warrant of execution issued under
the above case number on 22 April 2022 (hereafter “the
warrant”) is stayed pending
the final adjudication of the
interpleader proceedings under the same case number; and
3.
The sale in execution pursuant to the
above warrant of execution, as advertised to take place on 25 June
2022 at 13h00 is cancelled;
4.
The First Respondent shall pay the costs
of this application;
5.
Written reasons for this order will be
handed down in due course.”
[2]
The applicant, a private company with its registered address at
Welkom in the Free
State Province, applied as a matter of urgency, to
stay the execution of the warrant of execution and cancel the sale
pursuant
to the warrant, advertised to take place on 25 June 2022 at
13:00, pending the final adjudication of the interpleader proceedings

issued under the same case number.
[3]
The first respondent is Tarina de Jager (“Mrs De Jager”),
a major female
and mother of two minor children.  The second
respondent, Molifi Aaron Matsoso, N.O.  (the “Sheriff”)
is
cited in his official capacity as the Sheriff for the district of
Theunissen. The third respondent is Pieter Janse de Jager (“Mr

De Jager”) the ex-husband of the first respondent.  The
fourth respondent is Wilhelmina Petronella Pretorius a major
female
residing in Potchefstroom.  No relief is sought against Mr De
Jager and fourth respondent. Mrs De Jager opposed the
application.
[4]
Mr and Mrs De Jager were divorced and 23 May 2019.  The Deed of
Settlement concluded
between Mr. and Mrs. De Jager was made an order
of court. Mrs De Jager alleges that Mr De Jager is in arrears as
regards his obligations
in terms of the Deed of Settlement.  She
obtained a warrant and attachment was effected on 13 August 2021. The
Sheriff attached
various immovable items as per the inventory
appended to the founding affidavit. On 31 January 2022 the Sheriff
issued and interpleader
notice calling on claimants to deliver
particulars of the claims on or before 11 March 2022.
[5]
Mr N E R Greyling, a director of the applicant, submitted an
affidavit for purposes
of the interpleader proceedings.  The
gist of the claim is that various of the attached movables are the
property of the applicant
and consists of livestock, a compressor,
tools etc. The interpleader proceedings were enrolled to be heard on
22 April 2022. However,
none of the claimants appeared at the hearing
with the result that the interpleader application was removed from
the roll. On 3
June 2022 the applicant received a notice of sale in
execution in terms whereof the attached items would be sold in
execution on
25 June 2022 at 13h00.
[6]
On 7 June 2022 the applicant’s attorney quested Mrs De Jager’s
attorney
in writing not to proceed with the sale in execution and to
provide the applicant with prove of same by 13h00 on 11 June 2022,
failing which, the applicant intends applying for an order to stay
the execution of the warrant pending the adjudication of the

interpleader proceedings. On 13 June 2022 the applicant’s
attorney telephonically discussed the request to stop the auction

with Mrs De Jager’s attorney who allegedly undertook to revert
regarding the cancellation of the auction.  On 17 June
2022 and
after no response was received regarding the request, the applicant’s
attorney addressed a further letter to Mrs.
De Jager’s attorney
indicating that should confirmation of the cancellation of the
auction not be received by close of business
on 17 June 2022, the
applicant will have no option but to approach the court for urgent
relief together with a request for a punitive
cost order.
[7]
The applicant enrolled the interpleader proceedings for hearing on 18
July 2022. Mr
Louw, counsel on behalf of Mrs De Jager argued that the
applicant waited until 21 June 2022 to approach the court, a mere 2
days’
notice seeking to stay the execution. It is therefore
argued that the applicant’s urgency is self- created and the
matter
should be struck from the roll for lack of urgency.
[8]
At the hearing of this application on 24 June 2022, I ruled that the
matter is urgent
and heard arguments pertaining to the merits of the
application. I was satisfied that the applicant explained the
circumstances
which it avers rendered the matter urgent. I was of the
view that the delay in bringing the application may have been caused
by
the fact that the applicant’s attorney attempted to settle
the matter by way of correspondence. It appears as if, and due
to
some misunderstanding, the applicant’s attorney waited for Mrs
De Jager’s attorney’s response while the latter
had
allegedly already telephonically indicated that the sale in execution
will proceed as advertised. The sale in execution was
to take place
the following day. Rule 6(12) allows the court to come to the
assistance of a litigant who claims that he could not
be afforded
substantial redress at a hearing in due course.
[9]
Mr Van der Merwe, counsel on behalf of the applicant, argued that
should the sale
in execution proceed on 25 June 2022, the attached
assets not belonging to Mr De Jager and under
bona fide
claims
of ownership by third parties, including the applicant in a pending
interpleader proceeding, will be sold in execution.
The urgent
application is the only means by which the applicant can avert the
injustice that would be occasioned should the sale
in execution
proceed.
[10]
On behalf of Mrs De Jager it was contended that the applicant is
laying claim to assets which
are simply not under attachment and has
therefore failed to prove any “right” (whether it be only
prima facie and open
to some doubt or a clear right) to the attached
property.  The applicant failed to mention any specific harm it
would suffer
if the sale proceeds and also failed to disclose that it
will have no alternative recourse should the sale proceed.
[11]
Mr Louw argued that the “true brain” behind the current
application was Mr. De Jager,
who with his co-director of the
applicant-company, Mr Greyling, have concocted a further scheme to
delay and circumvent payments
in terms of the judgment debt.
From the contents of a confirmatory affidavit deposed to by the
fourth respondent, it was
furthermore evident that the assets claimed
to belong to her as per the interpleader, was false as she was
coerced by Mr De Jager
into filing claims specifically to avoid the
execution process from proceeding.
[12]
The effect of the issue of an interpleader notice is that any action
by either of the claimants
against the Sheriff is stayed
[1]
.
One of the special circumstances in which the aid of the court may be
invoked to stay proceedings temporarily, is in terms of
the
provisions of Rule 58 or so-called “interpleader proceedings”.
In
Strime
v Strime
[2]
Tebbutt J held as follows:

Execution
is a process of the Court and the Court has an inherent power to
control its own process subject to the Rules of Court.
It
accordingly has a discretion to set aside or stay a writ of execution
(see Williams v Garrick
1938 TPD 147
at 162; Graham v Graham
1950 (1)
SA 655
(T) at 658; Cohen v Cohen
1979 (3) SA 420
(R) at 423 D-C). The
Court will, generally speaking, grant a stay of execution where real
and substantial justice requires such
a stay or, put otherwise, where
injustice would otherwise be done.”
[3]
[13]
On behalf of Mrs De Jager it was contended that the failure of the
applicant (as a claimant)
to comply with the provisions of Rule 58
and the interpleader proceedings subsequently being struck from the
roll, means that no
interpleader proceedings are currently pending.
Rule 58(5) provides that if a claimant to whom an interpleader notice
and affidavit
have been duly delivered fails to deliver particulars
of his claim within the time stated or, having delivered such
particulars,
fails to appear in court in support of his or her claim,
the court may make an order declaring him and all persons claiming
under
him barred as against the applicant from making any claim on
the subject- matter of the dispute. Mr Van der Merwe argued that the

applicant has not been barred in accordance with the provisions of
Rule 58(5). The matter has been re-enrolled for hearing on 18
July
2022 and it therefore cannot be argued that no interpleader
proceedings are pending. The applicant did not abandon the
interpleader
proceedings and will see to it that the matter proceeds
as enrolled for 18 July 2022.
[14]
Essential to the operation of Rule 58 is the allegation by the
Sheriff that two or more parties
are making adverse claims to the
items attached. It is not expected of the claimants to clothe his/her
claim with the same precision
as in a pleading. I agree with the
submission made by Mr Van der Merwe that this is not the correct
forum to adjudicate the claims
made in respect of the items attached
by the Sheriff. The applicant contends that an injustice would be
done if the sale in execution
would be allowed to proceed where it
has a reasonable prospect of success at the hearing of the
interpleader proceedings set down
for 18 July 2022.
[15]
Execution should generally be allowed to proceed unless the applicant
for a stay shows that real
and substantial justice requires that such
a stay should be granted.
[4]
I
was satisfied that the applicant is entitled to a stay of the
execution pending the final adjudication of the interpleader
proceedings,
which in any event will be heard within a month.
[16]
There remains the question of costs. Even though this court had
sincere sympathy with Mrs De
Jager and her efforts to obtain
compliance with the maintenance orders and other provisions of the
Deed of Settlement, there was
no reason why the normal rule that
costs follow the result should not apply in this matter.
VAN
RHYN J
On
behalf of the Applicant:

ADV J VAN DER MERWE
Instructed
by:                                                     JACOBS

FOURIE ATTORNEYS
BLOEMFONTEIN
On
behalf of the  First Respondent:                   ADV.

M C LOUW
Instructed
by:                                                     KRUGER

VENTER  ATTORNEYS
BLOEMFONTEIN
[1]
Chase & Sons (Pty) Ltd v Tecklenburg
1957 (3) SA 51
(T); Rule
58(7).
[2]
1983(4) SA  850 (CPD).
[3]
At 852 A-B.
[4]
Van Rensburg and Another NNO v Naidoo and Others NNO; Naidoo and
Others NNO v Van Rensburg NO and Others
2011 (4) SA 149
(SCA) at
para 51-54.