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[2022] ZAECMHC 39
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Nedbank Limited v Vika (46/2018) [2022] ZAECMHC 39 (27 September 2022)
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Certain
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IN THE HIGH COURT OF
SOUTH AFRICA
(EASTERN CAPE DIVISON,
MTHATHA)
Case
No: 46/2018
In
the matter between:
NEDBANK
LIMITED
APPLICANT
And
NOZIBELE
VIKA
RESPONDENT
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED.
JUDGMENT
SMITH
J:
[1]
The applicant seeks an order in terms of Uniform Court Rule 46 (A),
declaring the
respondent’s primary resident executable.
[2]
The parties concluded a written loan agreement on 31 January 2008, in
terms of which
the applicant advanced to the respondent the sum of
R598 000. The applicant then caused a mortgage bond to be
registered against
the respondent’s immovable property for the
capital sum of R101 480 and an additional sum of R26 000.
[3]
The respondent subsequently fell into arrears and on 4 April 2019,
the court granted
judgment against her for the payment of the sum of
R100 577.82, together with interest and legal costs. The
respondent has
failed to satisfy the judgment debt and at the time of
the launching on this application, the arrears amounted to
R87 981.60,
representing almost 61 monthly instalments.
[4]
The last payment made by the respondent at the time of the launching
of the application
was R777.74, which was paid on 1 December 2017.
She has since only paid a further sum of R5000.
[5]
The current market value of the immovable property is R480 000.
The respondent
has estimated the value at R650 000.00, but has
not provided any rational and objective basis for that valuation.
[6]
The municipal valuation as at 28
January 2021 was R124 000, and as at 28 February
2021, the
respondent owed R27 462.39 in respect of municipal rates and
taxes.
[7]
The respondent has declined to participate in the applicant’s
Assisted Sales
Programme, which would have allowed her to sell the
property at the best possible price. She would also have qualified
for discount
on the remaining balance and would have been allowed to
pay off the remaining debt interest free.
[8]
At the time of concluding the loan agreement, the respondent was
employed by a firm
of attorneys and earned a gross salary in the sum
of R13 200. She resigned that post in 2017 and took up
employment with a
firm of estate agents, where she was promised a
basic salary of R15 000 per month, plus commission. The
respondent claimed
that the company, however, failed to honour their
obligations and she consequently never received her salary. She,
nevertheless,
remained in their employment for four years until
January 2021. Since then she has been working independently in the
real estate
industry.
[9]
The Respondent alleged that she would have alternative means to
satisfy the debt from
commissions in respect of four properties for
which she had received mandates to sell. Once she receives the
commission, she will
be able to settle the debt in full. However,
apart from the legal difficulties that arise from the fact that the
respondent purports
to be operating as an estate agent without a
fidelity fund certificate required in terms of the Estate Agency
Affairs Act, 112
of 1976, it was not clear at the time of the hearing
what had happened with regard to those sales and why, some months
after the
filing of the answering affidavits, she has apparently not
received any commission.
[10]
She also opposed the application on the basis that an execution order
will infringe upon her
constitutional rights to property and to
access to adequate housing. Mr Pangwa, who appeared on her behalf,
was constrained to
concede that she had failed to show that she has
alternative means to satisfy the debt or that her constitutional
rights will be
infringed if an execution order were granted. It is
common cause that the respondent has voluntarily mortgaged her
property as
security for her obligations in terms of the loan
agreement. In
Gudwana v Steko Development CC & Other
2011
(3) SA 608
(cc), at paragraph 53-54, the Constitutional Court held
that:
“
It
must be accepted that execution and itself is not an odious thing. It
is part and parcel of economic life. It is only when there
is
disproportionality between the means used in the execution process to
exact payment of the judgment debt, compared to other
available means
to attend the same purpose, that alarms bells start ringing. If there
are no other proportionate means to attain
the same and, execution
may not be avoided.”
[11]
Our courts have repeatedly emphasised that execution mechanisms must
be effective to have legitimacy
and public confidence in them should
not be lightly disturbed. If the efficacy of the execution against
mortgage bonds is undermined
by courts refusing to declare property
executable where a debtor clearly has no alternative means to satisfy
the debt, it may serve
to sequester the immovable property from
creditors, thereby rendering it useless as a means to raise credit.
The prejudicial consequences
arising from such an approach, not only
for banks but also for prospective homeowners, are self-evident. In
Jafta v Schoeman & Others, Van Rooyen v Stolts and Others
[2004] ZACC 25
;
2005
(2) SA 140
(CC) the Constitutional Court held that:
“
If
the requirements of the rules have been applied with and there’s
no other reasonable way by which the debt may be satisfy,
an order
authorising the sale and execution may ordinarily be appropriate
unless the ordering of that sale in the circumstances
of the case
should be grossly disproportionate.”
[13]
Mr Pangwa has to his credit not attempted to his challenge these
established legal principles,
but has instead submitted that the
court should use its discretion to allow the respondent reasonable
time to pay the debt. He
suggested that the court may, in exercising
its judicial oversight function, suspend the operation of the
execution order for a
period so as to allow the respondent sufficient
opportunity to pay off the debt.
[14]
Mr Ramsay, who appeared for the applicant, submitted that such an
order would not assist the
respondent, since it is clear that she
will not be able to acquire sufficient funds to satisfy the debt
within a reasonable time.
He submitted that the further delay would
instead be prejudicial to her since it would only serve to run up
interest. He argued
that, in any event, the execution process would
take a few months to be finalised, which will allow the respondent
more than sufficient
time to raise the necessary funds.
[15]
I am mindful of the fact that the loss of her house will be a
devastating financial blow to the
respondent and one from which she
may not recover. She appears to have been determined to save her
home, although she was clearly
unable to muster the financial means
to do so. Assuming that as part of my judicial oversight roll I do
have the power to suspend
execution of the order for a period, I am
not convinced that it will serve any purpose in the circumstances of
this matter. The
respondent has regrettable failed to provide any
evidence that she will be in a position to raise the funds to settle
the debt
within a reasonable time. In these circumstances, it is
unavoidable that an order authorising the sale and execution would be
fair
and appropriate.
[16]
I am consequently satisfied that the applicant has made out a case
for relief sought in the notice
of motion.
[17]
In the result I make the following order:
17.1. The immovable
property of the Respondent, more fully described as:
ERF [....] UMTATA
TOWNSHIP EXTENSION NO 68 KING SABATA DALINYEBO MUNICIPALITY DISTRICT
OF UMTATA, PROVINCE OF THE EASTERN CAPE IN
EXTENT 400 (FOUR HUNDRED)
SQUARE METRES HELD BY DEED OF TRANSFER NO. T1828/2000 SUBJECT TO THE
CONDITIONS THEREIN CONTAINED;
is hereby declared
executable.
17.2. A reserve price in
respect of the sale in execution of the aforesaid immovable property
is set at R240 000.00.
17.3. The respondent
shall pay the applicant’s costs of suit on the scale as between
attorney and client.
J.E.
SMITH
Judge
of the High Court
APPEARANCES
Date of
hearing
: 18 August 2022
Date of
delivery
: 27 September 2022
Attorney for the
Applicant :
Adv. Ramsay
:
Pagden Attorneys
C/o Smith Tabata
Attorneys
No. 34 Stanford Terrace
MTHATHA
Attorney for the
Respondent : Mr.
Pangwa
:
Caps Pangwa and Associates
No. 33 Callaway Street
MTHATHA