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[2022] ZAFSHC 331
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Nedbank Limited v D and Another (5700/2021) [2022] ZAFSHC 331 (22 November 2022)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
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SAFLII
Policy
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number: 5700/2021
Reportable:
NO
Of
Interest to other Judges: NO
Circulate
to Magistrates: NO
In
the matter between:
NEDBANK
LIMITED
PLAINTIFF
and
W[....]
S[....] D[....]
1
st
DEFENDANT
[ID
NR: [....]]
D[....]2
B[....] D[....]
2
nd
DEFENDANT
[ID
NR:[....]]
CORAM:
AS
BOONZAAIER AJ
HEARD
ON:
13
OCTOBER 2022
DELIVERED
ON:
22
NOVEMBER 2022
INTRODUCTION
[1]
This
is
an
application
for
Summary
judgment
where
Nedbank
institutes
Summary
judgment
proceedings
against
the
1
st
defendant,
for
payment
of
various
amounts
as
well
as
an
order
declaring
certain
property
specially,
executable in terms of
Rule
46A
of
the Rules of court.
[1]
[2]
The first defendant has filed a plea
that consists of various special pleas as well as a plea on the
merits. The first defendant
has also filed an opposing affidavit in
terms of
Rule 32
.
[3]
Judgment has already been obtained
against the second defendant.
BACKGROUND
FACTS
[4]
The genesis of this matter rests in the
breach of two loan agreements concluded between the parties. The
first loan agreement was
signed on the
on the 22
nd
June
2016 and the second loan agreement was signed on the 27
th
February
2017. The first defendant also signed a suretyship on behalf of the
D[....] Familie Trust, on 13
th
March
2018 one for Ursiweb (Pty) Ltd that was signed the 5
th
December 2019.
[5]
In terms of the agreements, the
plaintiff complied with its obligations in terms of the first and
second loan agreements and has
amongst others lent and advanced or
made available the amounts of R 2 550 00.00 and R 880 000 to both
first and second defendants.
Both the defendants undertook to repay
the plaintiff in monthly instalments of R 25 458.69 on the first loan
and the
monthly
instalment of R12 372.40 on the second loan.
[6]
Judgment has already been obtained
against the second defendant. The first defendant has neglected to
effect payment of the outstanding
balances on her payments and
summons was issued against her in terms of
Uniform
Rule 4(1)(a)(v).
[7]
The first and second defendants are
registered owners of the following properties namely:
[7.1]
section No.1, held by Deed of Transfer number [....], 1
B[....]Street, Bloemfontein;
[7.2]
section
No.2,
held
by
Deed
of
Transfer,
[....],
1
B[....]Street, H[....], Bloemfontein and
[7.3]
Erf [....], held by Deed of Transfer [....], G[....], Kwa- Zulu
Natal.
[8]
Mortgage Bonds were respectively
registered over the above-mentioned properties, covering the
defendant`s liability to plaintiff
as set out. The defendants
acknowledge that they are indebted to the plaintiff in the amounts of
R 2550 000.00, R 1050 000.00 and
R 1100 000.00
[9]
The relief sought by the plaintiff in
both the Summons and the Summary judgment application is an order for
payment of the outstanding
amounts and entitling the plaintiff to
take possession of the goods from the first defendant and or any
other person who may be
in possession of such goods through the
defendant. The goods in this case as alluded to above is the property
mentioned above.
ISSUES
TO BE DECIDED
[10]
The crisp issue for determination is
whether the first defendant in her Plea in any of her proffered
defences raises an issue for
trial as envisaged in
Rule
32(2) (b).
[10.1]
Rule 32 (2)
provides:
“
(a)
within 15 days after the date of [delivery of the plea], the
plaintiff [shall] deliver a notice of application for summary
judgment, [together with an affidavit] made by the plaintiff or by
another person who can swear positively to the facts.
(b)
the plaintiff shall in the affidavit
referred to in subrule (2)(a), [ verify the cause of action and the
amount, if any, claimed,
and identify any point of law relied upon
and the facts
upon
which the plaintiff’s claim is based, and explain briefly why
the defence as pleaded does not raise any issue for trial].
(c)
If the claim is founded on a [liquid
document a copy of the document shall be annexed to such
affidavit]
and
the
notice
of
application
for
summary
judgment
shall
state
that
the
application will be set down for hearing on a stated day not less
than 15 days from the date of the delivery thereof.”
[10.2]
The following areas of law need to be considered:
[11.2.1]
The requirements for Summary judgment in terms of
Rule 32(2)(b).
[10.2.2]
First defendant proffers a myriad of defences. The main issue to be
decided is whether the first defendant in any of her
defences
proffered, raises an issue for trial as envisaged in rule 32(2) (b).
ADMITTED,
UNDISPUTED AND COMMON CAUSE FACTS
[11]
The following is common cause between
the parties that:
[11.1]
in casu
, the mentioned agreements and suretyships have been
concluded.
[11.2]
the first defendant, is still indebted to the plaintiff.
[11.3]
the defendants would be jointly and severally liable in solidum
towards the plaintiff for the due compliance with the obligations
imposed in terms of the agreement.
FIRST
DEFENDANT`S CASE
[12]
According to the first defendant, the
following special pleas are relevant.
[12.1]
First Special Plea:
Lis
Pendens:
[
12.1.1] The first defendant has a retrenchment benefit insurance
policy with the plaintiff and submitted a claim to the plaintiff
on
2nd July 2021.
[12.1.2]
The plaintiff allocated a claim number for the consideration of the
retrenchment benefit claim for all the overdue amounts
due to the
plaintiff.
[12.1.3]
The retrenchment benefit claim submitted by the first defendant to
the plaintiff is currently still pending and in respect
of the same
subject matter
in casu
.
[12.1.4]
To date hereof the plaintiff has not accepted nor rejected the claim
in terms of the retrenchment benefit and once the
Insurance Benefit
pays out, the plaintiff shall either be indemnified partially,
alternately in full for the amounts due to it.
[12.1.5]
Plaintiff submits that action under aforesaid Case Number be stayed
pending the final adjudication of the retrenchment
benefit insurance
claim submitted by the first defendant to the plaintiff.
[12.2]
Second Special Plea
Beneficium
Ordinis Seu Excussionis (mis- joinder):
[12.
2. 1] The plaintiff has a secured claim against the insolvent estate
of Ursiweb (Pty) Ltd (in liquidation) against the main
contracting
party, the principal debtor.
[12.2.2]
The plaintiff in its cause of action relies upon agreements entered
into with Ursiweb (Pty) Ltd (in liquidation). Despite
the fact that
the Liquidators attending to the administration of the Insolvent
Estate is the same firm of attorneys representing
the plaintiff in
the current action, the Liquidators in their official capacity have
not been joined as parties to this action.
[12.2.3]
Effectively this entails that the plaintiff has mis- joined the
parties to and relevant to the cause of action in this
action to the
detriment of the first defendant, who has a substantial and material
interest herein.
[12.2.4]
The plaintiff did not join the parties necessary to this action under
the aforesaid Case Number and to this effect that
Liquidators of
Ursiweb (Pty) Ltd (in liquidation) in their official capacities have
been mis- joined.
[12.2.5]
That the plaintiff`s action be stayed until such time as the
Liquidators of Ursiweb (Pty) Ltd (in liquidation) has been
joined as
parties to the current action.
[12.
3]
Third Special Plea
Beneficium
de Dubious Vel Pluribus Reis Debendi:
[12.3.1]
It is further the first defendant`s case that the plaintiff has
already obtained judgment against the second defendant:
[12.3.2]
The plaintiff has not proceeded with any execution steps against the
second defendant, as surety and co- principal debtor
to reduce the
amount owing to the plaintiff.
[12.3.3]
The first defendant relies upon the legal exception of
beneficium
de duobus vel pluribus reis debendi
in that due to the non-
action of the legal representatives of the plaintiff towards the
Judgment already obtained against the second
defendant, the first
defendant is called upon to answer to the particulars of claim.
[12.3.4]
All monies recovered by the plaintiff from the second defendant shall
reduce the liability of the first defendant due to
the plaintiff and
as a result of the non-action of the legal representatives of the
plaintiff, the plaintiff is seeking to obtain
full payment also from
the first defendant, where it already has judgment against the second
defendant.
[12.3.5]
The first defendant prays that the action be stayed until such time
as the second defendant has been excused and a new
amount due and
owing to the plaintiff has been ascertained.
[12.4]
Fourth Special Plea
Non-Compliance
with the National Credit Act:
[2]
[12.4.1]
A portion of the plaintiff claim is based on the suretyship by the
first defendant for the indebtedness of the D[....]
Familie Trust.
[12.4.2]
The plaintiff cancelled all credit agreements with the D[....]
Familie Trust, obtained return of the vehicles and subsequently
sold
the vehicles by public auction.
[12.4.3]
The plaintiff failed to comply with Section 127 of the National
Credit Act and specifically section 5, 7 and 8 thereof.
[hereinafter
called the” NCA”].
[12.4.4]
The first defendant prays that the action be stayed until the
Plaintiff comply with the aforesaid sections of the NCA.
[12.5]
Fifth Special Plea
Credit
Provider Certificate:
[12.5.1]
The wrong Credit Provider Certificate was submitted as Annexure “
N1”
to the particulars of claim relating to ABSA bank Limited and not
relating to Nedbank limited.
[12.6]
Sixth Special Plea
Primary
residence
[10.6.1]
The property at 1, B[....]Street, H[....], Bloemfontein should not be
declared executable as first defendant and her two
minor children
currently resides there.
[12.7]
Seventh Special Plea
Jurisdiction
[12.7.1]
In terms of clause 25, Annexure “
N2”
of the first
loan agreement, the action should have been instituted in the
Magistrate Court
,” …en die Kliënt stem hiermee
tot die jurisdiksie van die Landdroshof in.”
[12.8]
Eight Special Plea
Non-
Joinder and Certificate of Balance:
[12.8.1]
The certificates of balance dated the 30th May 2022 are significantly
lower amounts and the Plaintiff failed to join the
principal debtor.
[12.9]
Ninth Special Plea
Dividend
will reduce surety:
[12.9.1]
A dividend is to be paid in due course by the Liquidators, once the
Plaintiff received a dividend from the liquidators
of the insolvent
estate of Ursiweb (Pty) Ltd (in liquidation) the amount due and owing
by first defendant, as surety towards plaintiff
shall be reduced.
[12.10]
Tenth Special Plea:
National
Credit Act finds application:
[12.10.1]
The NCA applies to the suretyship by first defendant in favour of the
plaintiff relating to the D[....] Familie Trust
as the trust, at the
date of this plea had only two trustees namely the first and second
defendants. Accordingly, the provisions
of the NCA apply to the
transaction and agreement between the Trust and the plaintiff.
[12.10.2]
The Trustees of the D[....] Familie Trust are not parties to the
current action.
[12.11]
Eleventh Plea:
Mediation:
[12.11.1]
The first defendant made settlement proposals in good faith which
proposals have to date not been rejected, and also
Rule 41 A (2)
(b)
mediation has not yet been finalized.
[
12.11.2] This issue of mediation is therefore still pending between
the parties. [12.12]
Twelve Special Plea:
Indebtedness
in terms of the suretyship:
[12.12.1]
For the alleged indebtedness in terms of the suretyships relating to
the D[....] Familie trust and Ursiweb (Pty) Ltd,
the plaintiff relies
on a clause in the suretyship with the following wording:
“
Such
a certificate or other form of evidence, as the case may be, will
upon the mere production thereof be binding on the defendants
and be
proof of the contents of such certificate on the face of it and the
fact that such amount is due and payable in any legal
proceedings
against the defendants, and will be valid as a liquid document
against the defendants in any competent Court.”
[12.12.2]
The
first
defendant
is
relying
on
the
case
of
Nedbank
Limited
v
Grant
Stewart Mc Glashan and 10 others.
[3]
[12.12.3]
The first defendant submit that the aforementioned clause is
contra
bonis mores
because it purports to be conclusive truth of the
debt. As it is offending public policy and hence unenforceable.
[12.12.4]
In
Nedbank Limited v Grant Stewart Mc Glashan
supra, it was
held that a similar worded clause in a suretyship is unenforceable.
[11.12.4]
The consequence hereof is that the plaintiff cannot rely on any
certificate of balance issued in terms of the relevant
suretyships.
[12.13]
Electronic signature
[12.13.1]
The first defendant contended that the signature to the Summary
judgment affidavit namely the Special Power of Attorney,
was an
electronic signature, and thus had to comply with the
Electronic
Communications and Transactions Act
[4]
,(herein
after called “
the
ECTA
”)
[12.13.2]
The first defendant states that she was advised that the Courts
require original legal documents to be filed at Court.
[13]
PLAINTIFF`S CASE
[13.1]
In rejecting the arguments of the defence, the plaintiff submits that
as the first defendant was invited to show good cause
she did not
succeed. Counsel for plaintiff argued that the defences were mostly
spurious and without merits.
[13.2]
The plaintiff was of the contention that the question remains if the
first defendant in her Plea raises an issue for trial.
First
defendant`s opposing affidavit should be read with reference to her
Plea (and cannot raise new further defences in her Plea.)
[13.
3] The Applicant further submitted that the issues raised in
the special pleas is a delaying tactic by the defendant
in that she
is in breach of the agreement and has no plausible defence before the
Court.
[13.4]
the first defendant must disclose “
a
fairly and arguable issue”
[5]
[13.5]
It
is only when adequate information is placed before the Court that the
Court can be satisfied that the defence is bona fide”
[6]
[13.6]
The plaintiff is further of the contention that “
the court
will only grant summary judgment
if
on
the
disclosed
facts
it
is
clear
that
the
plaintiff
has
an`unanswerable `
case”
[13.7]
The plaintiff pointed out that it is not registered as an Insurer,
hence the first defendant cannot have a policy with the
plaintiff.
Further that the reference number provided in Annexure”
A”
is not for a claim under an Insurance Policy
.
THE
LAW
[
14.1]
Summary judgment
[14.1.1]
The Summary judgment application calls for strict circumspection and
judicial
oversight in balancing the rights of both the applicant and the
defendant. The summary judgment proceedings have been described
as
drastic and robust proceedings. In
Joob
Joob Investments v Stocks Mavundla ZEK JV,
[7]
it
was held that Summary judgment proceedings are no longer
extraordinary and the Rule must be applied properly. The Summary
judgment
procedure exists for the applicant to obtain a speedy
judgment against the defendant in cases where the defendant has no
valid
defence to the claim. By short-circuiting an otherwise
potentially protracted trial, the applicant avoids incurring
unnecessary
costs associated therewith.
[14.1.2]
Naturally,
Summary judgment cannot be granted where it is clear that some
ventilation of evidence is required in order for the Court
to come to
a decision. Adopting this approach, the successful defendant who
demonstrates a triable defence is not excised from
further
anticipated litigation. Thus, the defendant retains (all) his
Constitutional Rights to access justice, as enshrined in
section
34
of the Constitution
.
[8]
[14.1.3]
It is trite that the discretion to a Summary judgment order must be
exercised judicially. There is no dispute in the present
matter that
the 1st defendant is still indebted to the applicant, the amount of
which is significant.
[14.2]
Lis pendens:
[14.2.1]
The three requirements for a successful reliance on the plea of
lis
pendens
are:
i)
The litigation is between the same
parties;
ii)
That the cause of action is the same;
and
iii)
That the same relief is sought in both
sets of proceedings.
[14.2.2]
It has been held that the plea of
lis pendens
shares similar
features to the defence of
res judicata
because their
underlying consideration is to ensure finality in litigation. Once a
suit has been instituted, it should be finalised
before that court
before another can be instituted by the same parties relating to the
same cause of action.
[14.2.3]
The doctrine of
lis
pendens
was
explained in
Caesarstone
SDot -Yam Ltd v The World of Marble and Granite and others
[9]
,by
Wallis J as follows:
“
As
its name indicates, a plea of
lis alibi
pendens is based on
the proposition that the dispute (lis) between the parties is being
litigated elsewhere and therefore it is
inappropriate for it to be
litigated in the court in which the plea is raised. The policy
underpinning it is that there should
be a limit to the extent to
which the same issue is litigated between the same parties and that
it is desirable that there be finality
in litigation. The courts are
also concerned to avoid a situation where different courts pronounce
on the same issue with the risk
that they may reach differing
conclusions. It is a plea that has been recognized by our courts for
over 100 years”
[14.3]
The legal exception
beneficium ordinis seu excussionis.
A
waiver of this benefit by a surety entitles the financial institution
to claim payment from the surety without first exhausting
the legal
remedies against the principal debtor.
[14.4]
The legal exception
de duobus vel pluribus reis debendi
A
waiver of this benefit by a co-debtor or surety entitles the
financial institution to recover the full debt from such co- debtor
`s surety, without the first requiring payment from the other debtor
or the principal debtor.
[14.5]
National Credit Act, 2005
The
following sections in the National credit Act find application with
regards to the surrender of goods:
“
Section
127(2)
Within
10 business days after the later of-
(a)
receiving a notice in terms of
subsection (l)(b)(i);
(b)
or (b) receiving goods tendered in terms
of subsection (l)(b)(ii), a credit provider must give the consumer
written notice setting
out the estimated value of the goods and any
other prescribed information.
Section
127(5)
After
selling any goods in terms of this section, a credit provider must-
(a)
credit or debit the consumer with a
payment or charge equivalent to the proceeds of the sale less any
expenses reasonably incurred
by the credit provider in connection
with the sale of the goods; and
(b)
give the consumer a written notice
stating the following:
(i)
The settlement value of the agreement
immediately before the sale;
(ii)
the gross amount realized on the sale;
(iii)
the
net
proceeds
of
the
sale
after
deducting
the
credit
provider’s
permitted
default charges, if applicable, and
reasonable costs allowed under paragraph (a); and
(iv)
the amount credited or debited to the
consumer’s account.”
Section
127
(7)
If
an amount is credited to the consumer’s account and it is less
than the settlement value immediately before the sale, or
an amount
is debited to the consumer’s account, the credit provider may
demand payment from the consumer of the remaining
settlement value,
when issuing the notice required by subsection (5)(b).
Section
127
(8)
If
a consumer-
(a)
fails to pay an amount demanded in terms
of subsection (7) within 10 business days after receiving a demand
notice, the credit provider
may commence 15 proceedings
in terms of the Magistrates’
Courts Act for judgment enforcing the credit agreement;
or
(b)
pays the amount demanded after receiving
a demand notice at any time before judgment is obtained under
paragraph 8, the agreement
is terminated upon remittance of that
amount.
In
either event contemplated in subsection (8), interest is payable by
the consumer at the rate applicable to the credit agreement
on any
outstanding amount demanded by the credit provider in terms of
subsection (7) from the date of the demand until the date
that the
outstanding amount is paid.
Section
127(10)
A
credit provider who acts in a manner contrary to this section is
guilty of an offence in terms of section 127(10).”
[14.6]
Primary residence
[14.6.1]
Rule 46A
on its plain wording applies to execution against all
residential immovable properties, save where appears otherwise.
[14.6.2]
Where specific provision is made for additional requirements to be
satisfied when the property sought to be executed against
is a
primary residence, this is expressly provided for in the rule, such
as in
subrule (2)(b)
where it is expressly stated that a court
shall not authorise the execution against immovable property which is
a primary residence
of a judgment debtor unless the court, having
considered all relevant factors.
[14.7]
Jurisdiction
[14.7.1]
In the matter of
Standard
bank of South Africa and Others v Thobejane and others,
[10]
the
SCA recently ruled that:
“
The
High Court must entertain matters within its territorial jurisdiction
that fall within the jurisdiction of a Magistrates’
Courts, if
brought before it, because it has concurrent jurisdiction with the
Magistrates’ Court. (2) The High Court is obliged
to entertain
matters that fall within the jurisdiction of a Magistrates’
Court because the High Court has concurrent jurisdiction.
(3) The
main seat of a Division of a High Court is obliged to entertain
matters that fall within the jurisdiction of a local seat
of that
Division because the main seat has concurrent jurisdiction. (4) There
is no obligation in law on financial institutions
to consider the
cost implications and access to justice of financially distressed
people when a particular court of competent jurisdiction
is chosen in
which to institute proceedings.”
[14.7.2]
It has nowhere been held that a principal debtor should be joined as
a plaintiff in an action against a surety. An order
against first
defendant can be sustained and or carried into effect against first
defendant without prejudicing the liquidators.
[11]
[14.8]
Non- joinder and Certificate of
Balance
[14.8.1]
It is now trite law that a party must of necessity be joined in
proceedings if he/she/it has a
substantial
direct and legal interest
in
those particular proceedings; a mere commercial or financial interest
itself is not sufficient as mentioned in the cases of
Amalgamated
Engineering Union v Minister of Labour
[12]
and in
Hartland
Implemente (Edms) Bpk v Enal Eiendomme en andere.
[13]
[14.8.2]
With regards to the Certificate of Balance, in
Rossouw
and Another v First Rand Bank Ltd t/a FNB Home Loans (Formerly First
Rand Bank of SA Ltd)
[14]
it
was held at para 47:
“…
To
the extent that the certificate reflects the balance due as at the
date of hearing, it is merely an arithmetical calculation
based on
the facts already before the court which the court would otherwise
have to perform itself. Such calculations are better
performed by a
qualified person in the employ of a financial institution. And to the
extent that such a certificate may reflect
additional payments by the
defendant after the issue of summons, or payments not taken into
account when summons was issued, this
constitutes an admission
against interest by the Bank and the Bank is entitled to abandon part
of the relief it seeks. Certificates
of balance handed in at the
hearing (whether a quo or on appeal) perform a useful function…”.
[14.8.3]
The Order by my sister Chesiwe J, is dated 10 February 2022 and thus
after Summons was issued. The correct certificate
amounts (as at 30
th
May 2022) for purposes of prayers 1 to 4 of the particulars of claim
are set out in annexure “
C1
” to
C 4”
to
the Plea and hence correct.
[14.8.4]
A certificate of balance is an evidentiary tool provided for in an
agreement to facilitate proof of the amount of the indebtedness.
The
certificate does not in itself establish liability.
[15]
[14.8.5]
In the matter of
Thrupp
Investment Holdings (Pty) Ltd and Thomas Bernard Goldrick
,
[16]
Van
Oosten J held the following at paragraph 6:
“
As
regards the effect of the absence of a certificate of balance-clause
in the suretyship counsel for the appellant submitted that
a proper
interpretation of their certificate of indebtedness-clause contained
in the lease agreement leads one to conclude that
the production of
such a certificate in fact established the liability of the lessee
for the amount certified, which in turn was
sufficient to constitute
prima facie proof of eligibility of sureties. The argument in my view
is flawed in its premise. A certificate-clause,
it has been held in a
number of cases, is designed to facilitate proof of the amount of
liability (See Nedbank Ltd v Abstein Distributors
(Pty) Ltd and
Others
1989 (3) SA 750
(T); Bank of Lisbon International Ltd v Venter
en Ander
1990
(4) SA 463
(A) at 478 E). The certificate is therefore is merely
an
evidentiary tool provided for in an agreement by one contacting party
to the other to facilitate proof of the amount of indebtedness.
It
does not in itself establish liability
.
In
casu
the
clause was only valid as between the lessor and the lessee and
therefore could not be invoked against the sureties. The fact
that
the suretyship was referred to in and in addition
to
that, also annexed to the lease agreement, is of no moment. The
suretyship although collateral to the lease agreement, remains
a
separate and independent agreement and the certificate of
balance-clause therefore as correctly heard by the Judge a quo, did
not by reference become incorporated into the suretyship. (My
emphasis)”
[14.9]
Credit Provider Certificate
[14.9.1]
The first defendant asserts that an Annexure “
N1”
pertaining to ABSA Bank Limited as a credit provider and not
Annexure “
N1”
certificate relating to Nedbank
limited as credit provider is attached to the particular of claim.
[14.9.2]
It was however pointed out in the Plaintiff`s Summary judgment that a
wrong credit providers certificate was initially
attached, that on 22
March 2022 the plaintiff filed the correct Annexure “
N1”.
My sister Mbhele already adjudicated on the matter when she
dismissed the first defendant`s application for a
R 30
Notice
of Irregular Step.
[14.10]
Mediation
Rule
41A
, introduced into the Uniform
Rules of Court in February 2020, mandates that parties to a dispute
consider mediation as dispute
resolution mechanism.
[14.11]
Applicability of NCA to
Suretyship
[14.11.1]
Section 4 of the NCA
refers “in paragraph (a) and (b)
both
to “the time the agreement is made “.
[14.11.2]
From Annexure “E” which shows that until the resignation
of Mr. AM de Wet in May 2022 the Trust had three
Trustees and
qualified as a juristic person.
[14.12]
Indebtedness in terms of the suretyship
[13.12.1]
The
Thrupp Investment Holdings (Pty) Ltd
case supra also find
application. It seems that the 1st defendant would be liable in terms
of the suretyship.
[14.13]
Electronic signature
[14.13.1]
The
Concise English Oxford Dictionary
[17]
defines ‘signature’ as:
‘
a
person’s name written in a distinctive way as a form of
identification or authorization.’ Black’s Law Dictionary
(5th ed 1239) gives the definition of ‘sign’ and
‘signature’, which read together bring us close to the
legal meaning of signature. ‘To ‘sign’, it
explains, is 'to affix one's name to a writing or instrument, for
the
purpose of authenticating or executing it, or to give it effect as
one's act; To attach a name or cause it to be attached to
a writing
by any of the known methods of impressing a name on paper; To affix a
signature to . . . To make any mark, as upon a
document, in token of
knowledge, approval, acceptance,
or
obligation'. ‘Signature’ is defined as ‘The act of
putting one's name at the end of an instrument to attest
its
validity; the name thus written . . . And whatever mark, symbol or
device one may choose to employ as representative of himself
is
sufficient.’
[18]
The
provisions of the ECTA have, as its objects the enablement and
facilitation of electronic communications and transactions in
the
public interest. To this end, amongst others, it seeks to promote
legal certainty and confidence in respect of electronic
communications and transactions,2 and to ensure that electronic
transactions in the Republic conform to the highest international
standards.
[14.13.2]
Section
12
of
the
ECTA
provides
that a requirement in law that a document must be in writing, is met
if the document is in the form of a
data
message and accessible in a manner usable for subsequent
reference.
[19]
[14.13.3]
Section 13
of the
ECTA
provides as follows:
“
(1)
Where the signature of a person is required by law and such law does
not specify the type of signature, that requirement in
relation to a
data message is met only if an advanced electronic signature is used.
(2)
Subject to (1), an electronic signature
is not without legal force and effect merely on the grounds that it
is in electronic form.
(3)
Where an electronic signature is
required by the parties to an electronic transaction and the parties
have not agreed on the type
of electronic signature to be used, that
requirement is met in relation to a data message if – a method
is used to identify
the person and to indicate the person’s
approval of the information communicated; and
(4)
having regard to all the relevant
circumstances at the time the method was used, the method was as
reliable as was appropriate for
the purposes for which the
information was communicated.
(5)
Where an advanced electronic signature
has to be used, such signature is regarded as being a valid
electronic signature and to have
been applied properly, unless the
contrary is proved.
(6)
Where an electronic signature is not
required by the parties to an electronic transaction, an expression
of intent or other statement
is not without legal force and effect
merely on the grounds that – (a) it is in the form of a data
mass message; or
c)
it
is
not
evidenced
by
an
electronic
signature
but
is
evidenced
by
other
means
d)
from which such person’s intent or
other statement can be inferred.”
[14.13.4]
The
ECTA
defines an electronic signature as:
“
Data
attached to, incorporated in, or logically associated with other data
and which is intended by the user to serve as a signature”.
[14.13.5]
An advanced electronic signature is defined as:
“
An
electronic signature which results from a process which has been
accredited by the Authority as provided for in section 37, which
provides that the Accreditation Authority may accredit authentication
products and services in support of advanced electronic signatures.
Section 38 provides that the accreditation authority may not accredit
authentication products or services unless the accreditation
authority is satisfied that electronic signature to which such
authentication products and services relate complies with the
requirements
set out in section 38.
[14.13.5]
Hoexter
JA explained in
Jurgens
Volkskas Bank
[20]
:
“
The
function of a signature is to signify that the writing to which it
pertains accords with the intention of the signatory. It
conveys an
attestation by the person signing of his approval and authority for
what is contained in the document.”
[14.13.6]
Chapter
3 of the Electronics Communications and Transactions Act
finds
application.
[21]
In terms of
section
11
thereof
information is not without legal force and effect merely on the
grounds that it is wholly or partly in
the
form of data message. In similar vein
section
12
thereof
determines that a requirement in law that the document must be in
writing is met if the document or information is in the
form of a
data message. Further
section
13
states
that an electronic signature is not without legal force or merely on
the ground that it is in electronic form.
[14.13.7]
1.
Original
“
(1)
Where a law requires information to be presented or retained in its
original form, that requirement is met by a data message
if—
(a)
the integrity of the information from
the time when it was first generated in its final form as a data
message or otherwise has
passed assessment in terms of
subsection (2); and
(b)
that information is capable of being
displayed or produced to the person to whom it is to be presented.
(2)
For the purposes of subsection 1(a), the
integrity must be assessed—
(a)
by considering whether the information
has remained complete and unaltered, except for the addition of any
endorsement and any change
which arises in the normal course of
communication, storage and display;
(b)
in the light of the purpose for which
the information was generated; and
(c)
having regard to all other relevant
circumstances.”
[15]
APPLICATION OF THE LAW TO FACTS
[15.1]
Lis Pendens
[15.1.1]
In
casu
concerning the
lis pendens
point the first
defendant contends that this application is based on the same cause
of action as that in the plaintiff and first
defendant`s dispute with
regards to the retrenchment policy. The determination in the dispute
and outcome of the retrenchment policy
involves the same party and
causa
, which is substantially the same as in this application
for summary judgment.
[15.1.2]
In my view, the
lis pendens
point raised by the first
defendant is unsustainable for the following reasons. It is not in
dispute that the essential elements
upon which the application for
summary judgment are based on are the instalment agreements, the non
-payment thereof and the subsequent
cancellation thereof by the
applicant. However, this does not mean that the outcome of the
decision by the applicant to pay out
the policy is determinative of
the outcome in the present matter or vice versa. The legal force to
pay what is due to the applicant
remains despite the success or the
failure of the policy being paid out to first respondent.
[15.1.3]
In brief, the plea of
lis pendens
is unsustainable because the
cause of action in each of the issues is different. The relief sought
in the present application is
based on the first defendant being
unable to pay her debt under the instalment agreements. As indicated
by plaintiff, the retrenchment
policy is not a court action and is
based on another alleged agreement between the plaintiff and the
first defendant.
[15.1.4]
The plaintiff also indicated that they are not registered as an
insurer and hence the first defendant cannot have an insurance
policy
with the plaintiff.
[15.2]
National Credit Act
[15.2.1]
It is clear from
section 127(10)
that compliance with this
provision of the NCA is compulsory. From
section 127
it is
also clear that it deals with the surrender of goods.
[15.2.2]
It pertains where a consumer by itself will give written notice
to
the credit provider to terminate an agreement.
[15.2.3]
On the first defendant`s own version the plaintiff in its action
against the D[....] Familie trust
cancelled the credit agreements and
then obtained return of the vehicles whereafter it subsequently sold
the vehicle by public
auction.
[15.2.4]
Accordingly
section
127(5)
,
(7)
and
(8)
does
not
apply
to
the
action
in
casu.
[15.3]
Non -Joinder Ursiweb
The
1
st
defendant contends that the non-joinder of the
Liquidators of Ursiweb (Pty) Ltd constitutes a fatal defect in the
proceedings.
The applicant on the other hand avers that, while
Ursiweb have an indirect interest in the matted, their interest is
not of the
nature that requires them to be joined in these
proceedings. The liquidators do not have a direct and substantial
interest in any
court order this court might make against 1st
defendant. It is also not a situation that an order against 1st
defendant cannot
be sustained or carried into effect without
prejudicing the liquidators.
Accordingly,
the liquidators need not to be a party to this action.
[15.4]
Jurisdiction
[15.4.1]
Paragraph 14 of the Mortgage Bond stipulates that:
“
In
terms of section 45 of the Magistrate`s Court Act, 1944 and at the
option of the Mortgager any claim arising under this bond
may be
recovered in any magistrate’s court, having jurisdiction, and
the Mortgager hereby consents to the jurisdiction of the magistrate`s
court.” [own emphasize]
[15.4.2]
Paragraph 25 of the loan agreement between the plaintiff and
1st
and 2nd defendants however stipulates
that:
”
Ingevolge
artike 45 van die Wet op Landdroshowe ,1944 en na die keuse van
Nedbank, mag enige eis wat wat uit hierdie Ooreenkoms
voortspruit, in
enige landdroshof met jurisdiksie verhaal word., en die Kliënt
stem Hiermee tot die jurisdiksie van die landdroshof
in .”
[15.4.3]
It
is
Applicant`s
contention
that
consent
to
the
magistrate
court`s jurisdiction by 1st
Defendant, does not have the effect that
action must be instituted in the
magistrate`s
court.
The
fact
that
clause
25
mentioned
that
“
na
die keuse van Nedbank “which
implies that Nedbank, by agreement, also had the choice as to
where
to institute action.
[15.4.4.]
It is my interpretation of the above case law that the High court has
concurrent jurisdiction and that this defence does
not raise any
issue for trial.
[15.5]
Non -Joinder & COB
The
liquidators do not have a direct and substantial interest in an order
by this court against first defendant. The fact that the
first
defendant in any case renounced her benefit of excussion, the issue
of misjoinder of the liquidators falls away as irrelevant.
[15.6]
Beneficium de Dubious Vel Pluribus Reis Debendi
[15.6.1]
The benefit of division entails the right to demand that a debt be
divided between all solvent co -sureties.
[15.6.2]
A co- surety may expressly renounce this benefit. In case the first
defendant as surety has indeed renounced the benefit
of division as
can be seen from Clause 11 of Annexure “N11”.
[15.6.3]
This means that she is no longer entitled to claim that her
obligation to plaintiff be divided proportionally between her,
co
-surety and principal debtor.
[15.7]
Beneficium Ordinis Seu Excussionis
[14.7.1]
Clause 11 of the suretyship Annexure”
N
11’
,
the first defendant renounced the benefit of
excussion
and in
which it was described that she no longer will be entitled to claim
that plaintiff first exhaust its remedies against Ursiweb
(Pty) Ltd.
[15.7.2]
In this clause it is described that it means that she will no longer
be entitled to claim that plaintiff first exhaust
its remedy against
the principal debtor before proceedings against her in terms of the
suretyship. Important to note further that
the benefit of
excussion
is only of assistance to a surety as such, whereas the 1st
defendant, respondent bound herself both as surety and co-principal
debtor.
[15.8]
Certificate of Balance
The
Order by my sister Chesiwe J, is dated 10 February 2022 and thus
after Summons was issued. The correct certificate amounts (as
at 30th
May 2022) for purposes of prayers 1 to 4 of the particulars of claim
are set out in annexure “C1” to C 4”
to the Plea
and hence correct.
It
is clear that the Credit provider Certificate was correct and updated
at the time of the application for the summary judgment.
[15.9]
Dividend will reduce the suretyship.
[15.9.1]
The first defendant claims that a dividend to be paid by the
liquidators of Ursiweb (Pty) ltd in liquidation shall dramatically
reduce her liability towards the plaintiff, in this she accordingly
relies on the benefit of excussion.
[15.10]
Mediation
[15.10.1]
The first defendant at the arguing stage submits that the defendant
was willing to negotiate settlement and there was
no response or
rejection from plaintiff. In terms of
rule 41A
of the uniform
rules of court makes provision for mediation. The nub of mediate
in
casu
would be to re- negotiate a new instalment or payment
policy.
[15.10.2]
I am of the opinion that mediation will not assist the parties any
further. There is no point in further negotiation,
especially since
application for Summary judgment is claimed, due to the
non-performance of the first defendant.
[15.10.3]
As of 9 March 2020 a court may “direct the parties to consider
referral of a dispute to mediation” in terms
of rule 41A.
Although mediation has been described as a voluntary process, the
court may direct the parties to consider mediation
as a dispute
resolution mechanism when it is clearly evident that such a procedure
will benefit the parties and move them closer
to better resolving the
dispute by such mechanisms. From the facts before this court, I am of
the view that it is counter-productive
to force the plaintiff into
mediation on the basis that they have already been negotiating since
the signing of their contract
and have reached a stage of impasse.
[14.10.4]
Therefore, this is no defence. [15.11]
Primary residence
[15.11.1]
In the cases involving the execution of residential immoveable
property of a judgment debtor
Rule 46A (2)
requires the court
to determine whether the property is a primary residence of the
judgment debtor before ordering execution.
[15.11.2]
First defendant is of the contention that this court need to take
into account that the property (without mentioning which
one of the
two properties in Ben Tindall) where the first applicant stays with
her children is the primary property and that the
execution of the
property would definitely infringe on their residing in the property.
[15.12.3.]
The plaintiff/applicant nevertheless has to comply with the
requirements of
Rule 46A
when a proper application in terms of
Rule 46A
is before court.
15.12
NCA APPLICABLE
[15.12.1]
The first defendant in her Plea over pleads that at the date of the
Plea, the D[....] Familie Trust had only two Trustees,
therefore the
provisions of the NCA applies to the transactions between the D[....]
Familie Trust and plaintiff, and thus applies
to the suretyship by
first defendant in favour of plaintiff for the debts of the D[....]
Familie Trust. It is thus denied that
the D[....] Familie Trust is a
juristic person.
[15.12.2]
The plaintiff however denies that the D[....] Familie Trust is not a
juristic person. It is only after the resignation
of De Wet that in
May 2022 that the Trust does not qualify as a juristic person for
purposes of the NCA.
[15.12.3]
Relevant to these proceedings is the fact that at the time of
entering into the four-loan agreement as set out in
N”10”
the trust was a juristic person.
[16]
Certificate of Balance
[16.1]
Prima facie proof or ex facie
[
16.1.1] In
Nedbank
Limited v Grant Stuart Mc Clashan and 10 others,
[22]
a
bank sued on a standard suretyship containing a clause providing for
a certificate of balance which stated that:
…”
on
the mere production thereof is binding on us and be proof of the
contents of such certificate on the face of it…”
[16.1.2]
Defendant
argued that the clause was unenforceable because it did not allow the
prospect of rebuttal, and relied on the decision
in
Nedbank
v Binder,
[23]
which
struck down the identical clause. The Bank argued that
Nedbank
v Binder
was
wrongly decided because the phrase `on the face of it ` means `prims
facie ` and thus a rebuttal was possible.
[16.1.3]
It was however held in
Nedbank v Binder
that:
“
On
the face of it ...` means `ex facie` ~ not `prima facie ` is
conclusive and not admitting of a rebuttal.”
[16.1.4]
It was further held that:
“
The
argument had to fail in summary judgment proceedings in respect of
proceedings based on suretyship because a defendant was not
called
upon to meet a case premised on the underlying contractual obligation
of another person towards the creditor.”
[16.1.5]
It is clear from the
Thrupp Investments Holdings
case supra,
that where there is not a dispute of indebtedness and only the amount
of such indebtedness falls to be determined, a
Certificate of Balance
can be used as evidentiary proof.
[16.1.6]
As I have already mentioned, the liability of the respondent towards
the applicant in this matter is not disputed. It is
in fact conceded.
17.
THE COURTS DISCRETION
[17.1]
The court has an overriding unfettered discretion which it must
exercise judicially and not arbitrarily. I have the discretion
to
exercise whether I should on the facts averred by the plaintiff,
grant summary judgment or whether, on the basis of the defence
raised
by the defendants, I should refuse it. If the court has any doubt as
to whether the plaintiff’s case is unanswerable
at trial such
doubt should be exercised in favour of the defendant and summary
judgment should accordingly, be refused.
[17.2]
The court can exercise its discretion and refuse summary judgment
even
if
the requirements resisting summary judgment have not been met
[11].
[17.3]
Considering
the
extraordinary
and
drastic
nature
of
the
Summary
judgment remedy in
Maharaj
v Barclays National bank v Barclays National Limited Bank
[24]
,
Corbett JA stated:
“
The
grant of the remedy is based on the supposition that the plaintiff’s
claim is unimpeachable and that the defendant’s
defence is
bogus and bad in law”
[25]
[17.4]
The test is whether on the set of facts before me, I am able to
conclude that the defence raised by the defendant is
a sham, a bogus
or is bad in law. What I have to decide on is whether, on the facts
alleged by the applicant in its particulars
of claim, I should grant
summary judgment or whether the defendant’s opposing affidavit
discloses such a
bona fide
defence that it should refuse
Summary judgment.
[17.5]
Due
to the peremptory nature of
Rule
32
,
courts are extremely reluctant to grant summary judgment unless
satisfied that the applicant has an unanswerable case. This is
because summary judgment is a drastic and robust remedy in that it
permits a judgment to be given without trial. It closes the
doors of
the Court to the defendant
[26]
.
It is only when there is no doubt that the applicant has an
unanswerable case that it should be granted.
[27]
In
Shepstone
v Shepstone
[28]
Miller J said:
“
The
court will not be disposed to grant summary judgment where, giving
due consideration to the information before it, it is not
persuaded
that the plaintiff has an unanswerable case” and that…
“a defendant may successfully resist summary
judgment where his
affidavit shows that there is a reasonable possibility that the
defence he has advanced may succeed on trial”.
[17.6]
Considering the above authorities, which established the legal
principles relating to summary judgment as well as
Rule 32
, I
see no reason to deviate from such principles.
18.
Rule 46 A
Is
execution against the immoveable property warranted
[18.1]
In arriving at an appropriate order, in accordance with
R 46A (5
),
I need to consider, amongst other factors which may be necessary to
give effect to
subrule 8
, the market value of the property,
the local authority valuation, the amount owing on the mortgage bond,
the amount owing to the
local authority as rates and other dues. In
terms of a valuation report, the market value of the property and the
forced sale value
is not known. The local authority valuation of the
property must also be attached.
[18.2]
The mortgaged property was also not described or mentioned as for
example a residential dwelling comprising of,
inter alia
,
number of bedrooms, a number of bathrooms, a single or double garage
and a normal or heated pool with solar panels if any?
[18.3]
In terms of subrule 8(d) a court considering an application under
R
46A
, may order execution against the primary residence of a
judgment debtor if there is no other satisfactory means of satisfying
the
judgment debt. The plaintiff did not mention that any other
satisfactory means exist.
[18.4]
Having considered all the circumstances of the matter I am persuaded
that another reasonable alternative exists
for the plaintiff to
enforce its rights. A declaration of the immovable property as
executable, would in the present matter constitutes
an abuse of
process and would infringe on the first defendant`s fundamental right
to access to adequate housing in terms of s
26 of the
Constitution.
There appears to be a disproportionality between
execution against the property and other possible means to exact
payment of the
judgment debt –No other possible means, not even
an opportunity to privately sell the property, has been proffered by
the
plaintiff. I am inclined to exercise my discretion in favour of
the first defendant.
[19]
RULING
[19.1]
In evaluating the evidence, I have considered the applicable law as
well as the facts before me.
[19.2]
When I consider what is required in terms of
Uniform Rule
32(2)(b),
including the special pleas I am satisfied that the
plaintiff has proof its case.
[19.3]
When I consider the application in terms of
Rule 46 A
in its
totality, there is no merit to grant an order in this regard.
[20]
COSTS
[20.1]
As
a general rule the award of the costs remains in the discretion of
the Judge.
[29]
The basic rule
of costs was described by J Innes in:
Kruger
Bros. Wasserman v
Kuskin
[30]
as
follows:
“
the
rule of our law is that costs- unless expressly otherwise enacted –
are in the discretion of the Judge”
[20.2]
The
general
rule
is
that
such
costs
should
follow
the
result,
being
that
costs are awarded to a successful litigant
[31]
.
“
Success”
means substantial success not only the form but the substance of a
judgment must be considered in establishing who
is the successful
party”
as
it was explained in
The
Law of Costs
[32]
[20.3]
A
value judgment of the situation should be made. The court retains its
discretion.
[33]
[20.4]
The invariable consequence of this is that, having regard to what was
placed before me, and in view of the fact that the
plaintiff is
substantially successful in its claim for Summary judgment and the
first defendant is substantially successful in
rebating the claim of
the R 46 A. I am of the view that it would be fair and just that each
party pay their own costs.
[21]
ORDER
In
the event the following order is made:
(i)
Summary judgment is granted against the
first defendant in terms of prayers 1 to 7 of the Notice of
Application for Summary Judgment.
(ii)
Prayers 8 (a) to (e) to stand over for
application procedure in terms
of
Rule 46 A.
(iii)
No order as to costs.
S
BOONZAAIER, AJ
For
the Plaintiff
:
Adv.HJ Benade
Chambers
Bloemfontein
Instructed
by: Symington
& de Kock
169
B Nelson Mandela drive
BLOEMFONTEIN
Counsel
for the First Defendant: MJH Steenkamp
Chambers Bloemfontein
Instructed
by :
Badenhorst
attorneys
Groenvlei
BLOEMFONTEIN
[1]
Uniform Rules of Court updated 26 June 2009.
[2]
Act 34 of 2005
[3]
Case Number 14714/2016, in the High Court of South Africa, Gauteng
Division
[4]
25 of 2002 (“the ECTA”).
[5]
Eisenbergs v OFS Textile 1949(3) SA 1047(O) at 1054
[6]
Jacobson v Triton Yachting Supplies 1974(2) SA 584 (OPD) at 588 H
[7]
[2009] All SA 407 (SCA)
[8]
The Constitution of South Africa Act, 108 of 1996.
[9]
2000 CC
[10]
ZASCA 92(25 June2021)
[11]
Harms, Civil procedure in the Superior Courts, p. B10B1.
[12]
1949(3) SA 637 A at 659
[13]
2002(3) SA 653 (NC) at 663 F-G.
[14]
(2011) 2 All SA 56 (SCA)
[15]
Thrupp Investment Holdings (Pty) Ltd v Goldrick
[2007] ZAGPHC 23
;
2008 (2) SA 53
(W) at para 6
[16]
Witwatersrand Local Division(A5027/05) [2007] ZAGPHC 23
[17]
Concise English Oxford Dictionary 12 ed (2012) Oxford University
Press.
[18]
Global and Local Investments Advisors Pty ltd and Nickolaus Ludick
Fouche 1/2019] ZASCA 08 (18 March 2020.
[19]
Fourlamel (Pty) Ltd v Maddison
1977 (1) SA 333
(A) at 342 – 3
and Sapirstein & Others v Anglo African Shipping Co (SA) Limited
1978 (4) SA 1
(A) at 12 B – D. Section 2(e). Section2(h).
[20]
1993(1) SA214(A)at 220 E
[21]
25 of 2002
[22]
And ten others
[23]
1483/20111[7 April 2016,per van der Linde J ]
[24]
1976 (1) SA 418 (A)
[25]
Ibid footnote 6 at 424G-[6] Todt v Ipser paragraph 11, LAWSA 3rd
Edition vol 4, LexisNexis, 2012 at paragraph 94
[26]
Evelyn Haddon & Co Ltd v Leojanko (Pty) Ltd SA 662 OPD at 666A
and the authorities quoted therein
[27]
Breitenbrach v Fiat S.A. (EDMS) Bpk
1976 (2) SA 226
AT 229
[28]
1974 (2) SA 462
E-H
[29]
Kruger Bros. & Wasserman v Ruskin
1918 AD 63
at 69); Ward v
Sulzer
1973 (3) SA 701
, Ward v Sulzer 1973(3) SA701 A.
[30]
1918 AD 63 69
[31]
Unimark Distributors (Pty) Ltd v Erf 94 Silvertondale (Pty) Ltd 2003
(1) SA 204 (T)
[32]
AC CILLIERS, THE LAW OF COSTS, Butterworths, 5th edition
[33]
Westbrook v Genref Ltd 1997(4) SA 216D