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[2022] ZAFSHC 231
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Diseko v Anthony Berlowitz Attorneys and Others (1580/2020) [2022] ZAFSHC 231 (7 September 2022)
IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Case
Number: 1580/2020
In
the matter of:
NEO
KHUMO
DISEKO
APPLICANT
and
ANTHONY
BERLOWITZ ATTORNEYS
1
st
RESPONDENT
VOLTEX(PTY)
LTD t/a LIGHTING STRUCTURES
AND
ATLAS
GROUP
2
nd
RESPONDENT
ABSA
BANK
3
rd
RESPONDENT
THERESA
VAN DER MERWE
4
th
RESPONDENT
JUDGMENT
BY: MOLITSOANE, J
HEARD
ON:
26 MAY 2022
DELIVERED
ON: 07 SEPTEMBER 2022
This
judgment was handed down electronically by circulation to the
parties'represantatives by email and released to SAFLII.
The
date and time for the hand down is deemed to be 09:00 on the 07
September 2022
[1]
The applicant seeks rescission of two cost orders granted by Musi JP
against
her in her personal capacity. Only the First Respondent
opposes the application. The orders she seeks to rescind are:
a)
The court order granted on 24 December 2020 in the business
rescue application under case number 1580/2020(the business rescue
cost
order);
b)
The court order granted on 22 April 2021 in the application
for leave to appeal under the same case number as above (the leave to
appeal cost order).
[2]
The applicant contends that the two cost orders were erroneously
sought
or were granted in the absence of the applicant. Rule 42(1)
provides that the court may on application rescind a judgment
erroneously
sought or granted in the absence of a party affected
thereby or a judgment where there is an ambiguity, error or a mistake
common
to both parties.
[3]
In
Bakoven Ltd v G.J. Howes (Pty) Ltd
the court said:
[1]
...
An order or
judgment is 'erroneously granted' when the Court commits an 'error
'in the sense of a 'mistake in a matter of law appearing
on the
proceedings of a Court of record." It follows that a Court in
deciding whether a judgment
was
'erroneously
granted'
is, like a
court
of
appeal,
confined
to the
record of the proceedings.
In
contradistinction to relief in terms of Rule 31(2)(b) or under the
common law, the applicant
need not
show 'good cause' in the sense of an explanation
for his
default and a bona fide defence.
Once the
applicant can point to an error in the proceedings,
he is
without further ado entitled to rescission.
[4]
A judgment
is erroneously granted if there existed at the time of its issue a
fact of which the court was unaware of, which would
have prevented
the granting of the judgment and which would have precluded the
court, if aware of it, not to grant the judgment.
[2]
[5]
It is necessary to refer to the background of this dispute. The
applicant
was the Human Resources Manager for lkageng Electrical
Contractors(Pty)Ltd(lkageng), and had been in the employment of the
said
company from 4 September 2014 to 23 September 2020. It is her
case that she was approached to act as applicant in a bid to place
lkageng in a business rescue. As a result, she duly deposed to a
confirmatory affidavit. the reason that she signed the affidavit
was
that according to what she was told, such an act would 'assist the
company'.
[6]
The applicant is adamant that her interaction with the matter of the
business
rescue application was only with the Fourth Respondent and
the signing of the confirmatory affidavit. She further contends that
she was informed by one Mr Orlowitz of the First Respondent that
there were orders made against her in the applications for the
business rescue and the leave to appeal. Mr Orlowitz also provided
her with a copy of the special leave to appeal to the Supreme
Court
of Appeal following the dismissal of the business rescue application
and the leave to appeal.
[7]
Upon receipt of the copies of the court orders the applicant sought
the
assistance of her current attorneys of record. Her attorneys
addressed a correspondence to the First Respondent annexed to the
papers marked Annexure FA 5 in which clarity was sought regarding the
mandate of the First Respondent to represent the applicant
in the
business rescue and leave to appeal applications.
[8]
The First Respondent opposes this application on the basis that the
applicant
has failed to make a case for the rescission of judgment.
[9]
It is not in dispute that the applicant was cited as a party in the
business
rescue application and the leave to appeal. The applicant
also signed a confirmatory affidavit. Her locus standi as well as her
citation as a party was never in dispute in both the business rescue
and the leave to appeal application. Section 131(1) of the
Companies
Act provides that unless a company has adopted a resolution
contemplated in section 129 of the Companies Act, an affected
person
may apply to a court at any time for an order placing a company under
supervision and commencing business rescue proceedings.
It is not the
case of the applicant that there was a resolution as contemplated in
section 129. The applicant had the necessary
locus standi, being an
'affected person'
as defined in section128(1 )(a) of the
Companies Act 71 of 2008
.
'Affected person'
in relation to a
company, means:
i.
A shareholder or creditor of the company;
ii.
Any registered trade union representing employees of the company;
and
iii.
If any of the employees of the company are not represented by a
registered trade union, each of those employees or their respective
representatives.
[10]
While the basis of the view that the judgment was granted erroneously
is that the applicant
did not mandate the Firs Respondent to
institute the business rescue and leave to appeal applications, at no
stage of those proceedings
did the applicant challenge the mandate of
the First Respondent. For all intents and purposes the court was made
aware by citing
the Applicant and also by filing the confirmatory
affidavit that the Applicant was a party to the proceedings. In its
judgment
the court said the following:
"At the centre of
both applications is lkageng Electrical Contractors(Pty) Ltd a
company incorporated in terms of the laws
of South Africa(lkageng).
In the one application, Mesdames Theresa Van der Merwe and Neo
Diseko(applicants), both employees of
lkageng, sought an order that
lkageng be placed under supervision and that business rescue
proceedings be commenced with in terms
of
section 131
of the
Companies Act No 71 of 2008
."
[11]
From the reading of confirmatory affidavit in the business rescue
application it is clear
that the Applicant confirmed with reference
to the affidavit of Theresa Van der Merwe that she and the said Van
der Merwe were
legally represented and that where submissions are
made in law, same were done on the advice of their said legal
advisers. It is
thus clear that the Applicant was legally represented
in the business rescue application.
[12]
It is difficult to discern the basis upon which the applicant can
contend that the order
of costs the court granted was erroneous. In
the absence of the challenge of the mandate of the First respondent
it is difficult
to see how it can be argued that the court granted
the order erroneously. The fact that the First Respondent was not
mandated to
represent the applicant is not a fact that the court was
made aware of. What is more clear to the court is that the First
Respondent
appeared to have believed that the applicant was a party
to the proceedings as indicated to an email sent to the Fourth
Respondent
on 7July 2020 attached to the papers marked Annexure
"AA4". The email from the First Respondent addressed to the
Fourth
Respondent says:
"I
refer
to the above
matter
and enclose
herewith
an affidavit
for
signature by you and Neo in the usual fashion.
"
[13]
It might be so that the First Respondent did not directly consult
with the Applicant. The
Applicant was, however, not an ordinary
employee that one may say was illiterate. She was a Human Resources
Manager of lkageng.
It is difficult to infer that she could have
deposed to an affidavit and confirmed the contents thereof without
understanding the
purport thereof. Even if it could be argued that
the applicant had no mandate to represent the applicant in those
proceedings,
in my view the undisputed evidence is that the applicant
was a party to the proceedings as an affected person. She also signed
a confirmatory affidavit as a party and by so doing, she put herself
at risk of an order of costs in the usual course of litigation.
I
cannot find that the order granted was erroneous.
[14]
The contention that the order was granted in the absence of the
applicant is disingenuous.
The proceedings in both the business
rescue and leave to appeal applications were so called motion
proceedings. It is common knowledge
that such proceedings are
essentially adjudicated on affidavits and supporting documents.
Parties do not generally attend court.
It cannot be said that once
the court grants an order, such an order was granted in the absence
of the parties. The parties were
in my view 'present' because their
documents were properly before court. During the applications their
Counsel moved their applications
on their behalf. Even in
circumstances where the legal representatives of the parties are not
before court, once their papers are
properly before court, such
papers cannot be ignored. For the reason the notion that the
applications were granted in the absence
of the parties ought to be
rejected. In my view the applicant has failed to make a case for
rescission. It is unnecessary to traverse
other points raised in
opposition. I make the following order:
ORDER
1.
The application is dismissed.
2.
The applicant is ordered to pay the costs of the First Respondent.
P.E.
MOLITSOANE, J
On
Behalf of the Applicant:
Adv. Van der Merwe
Instructed
by:
VAN WYK ATTORNEYS
BLOEMFONTEIN
On
Behalf of the First Respondent: Adv. L Acker
Instructed
by:
BLAIR ATTORNEYS
BLOEMFONTEIN
[1]
1992(SA 466 at 471E-I.
[2]
See Nyinguwa v Moolman 1993(2) SA 508(Tk); Naidoo v Matlala N.O. and
Others 201294) SA 143(GNP) at 153.