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[2021] ZAGPJHC 851
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LLR Properties (Pty) Ltd and Another v Sasfin Bank Ltd and Another (2020/10763) [2021] ZAGPJHC 851 (23 July 2021)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION
LOCAL
SEAT, JOHANNESBURG
CASE
NO: 2020/10763
DATE:
23 July 2021
Reportable:
No
Of
Interest To Other Judges: No
Revised
DATE:
23 July 2021
In
the matter between:
LLR
PROPERTIES (PTY)
LTD
First Applicant
RAMATSHILA-MUGERI:LUFUNO,
LESLIE
Second Applicant
and
SASFIN
BANK
LTD
First Respondent
SUNLIN
(PTY)
LTD
Second Respondent
LEAVE
TO APPEAL JUDGMENT
Johann
Gautschi AJ
1.
This is an application for leave to appeal
against the judgment which I granted on 24 May 2021 dismissing the
first and second applicants’
application in terms of Uniform
Rule 31 (2) (b), alternatively Rule 42 (1) (a), further alternatively
in terms of the common law,
for rescission of a judgment which had
been granted against them by default.
2.
The applicants are now represented by a new team
of counsel, namely, Adv K Tsatsawane SC and Adv H Salani. The
respondents opposed
the granting of leave to appeal and are again
represented by Adv JG Botha. Counsel for both parties filed written
heads of argument
in support of their respective contentions.
3.
The underlying basis on which leave to appeal is
sought is that, by reason of service of the summons at an incorrect
address, I
should have granted rescission in terms of Rule 42 (1) (a)
without any further enquiry as to whether the applicants had shown
good
cause by way of a
bona fide
defence. This is supported by the two judgments of the Supreme Court
of Appeal referred to in the notice of appeal, namely,
Rossiter
v Nedbank
[2015] ZASCA 196
and
Lohdi
2 Properties cc: v Bondev Development (Pty) Ltd
2007 (6) SA 67
(SCA).
4.
This is undoubtedly correct even though this was
not argued at the hearing of the rescission application. On the
contrary, the applicant’s
heads of argument (prepared by
applicants’ previous counsel) stated: “
It
is trite that despite an application that the judgment sought to be
rescinded was void ab origine, it is still incumbent on an
applicant
to show compliance with the requirements for rescission and must set
out his defence with sufficient particularity so
as to enable the
court to decide whether or not there is a valid and bona fide
defence
”. Consequently, the main
dispute addressed at length by the parties in their heads of argument
and at the hearing related
to whether a
bona
fide
defence had been shown.
5.
The relevant dicta in the above-mentioned
judgments were not drawn to my attention. I was unaware of them and
did not take them
into account when I dismissed the application for
rescission. The judgment of
Rossiter v Nedbank
was referred to in the applicants’ heads of argument, but in
support of a different point, namely, submissions made under
the
heading of “Bona fide defence” in relation to a different
point, namely, “
where material facts are
not disclosed in an ex parte application or if fraud is committed
(i.e. the facts are deliberately misrepresented
to the court)”
.
6.
With reference to the first applicant, Adv Botha
pointed out that nowhere in the founding affidavit had it been
contended that the
address for service on the first applicant was the
“incorrect address”. Moreover, he submitted that service
took place
at the address provided according to the “terms of
business” of the agreements and that consequently there was no
“incorrect”
service on the first applicant which would
amount to a procedural irregularity satisfying the jurisdictional
requirements of Rule
42 (1) (a). He referred to legible copies of the
master rental agreement for the PABX system which had been uploaded
to caselines
and which had been provided to the Judge who granted the
default judgment. Clause (ii) of the “
terms
of business
” provides as follows:
“
The address which
you choose to accept service of all documents on yourself will be,
for all purposes, your installation address
overleaf. The address
which you choose to receive any letters or notices on yourself will
be your Postal address or Telefax number.
You shall therefore be
deemed to have received any letter or notice on the 8th day of the
date of posting or on the day the notice
or letter was delivered or
telefax to the above-mentioned address”.
7.
Relying on the judgment in
Müller
v Mulbarton Gardens (Pty) Ltd
1972 (1) SA 328
(W) he submitted that the clause permitted service of all documents
for all purposes including the service of court process. The
respondents contended for a different interpretation of the judgment
and submitted that on a proper interpretation the aforementioned
clause does not include service of court process.
8.
With regard to the second applicant, Adv Botha
pointed out that a legible copy of the guarantee signed by the second
applicant in
respect of the PABX system showed that there is a
legible chosen
domicilium
address inserted, namely, “
10
Bluegumspoort Road, Louis Trichardt
”
and that this was in fact the address at which summons for the second
applicant had been served.
9.
However, that guarantee only relates to one of
the agreements, namely, the master rental agreement for the PABX
system which is
the subject matter of claim A. He could not show that
any such address had been provided in the guarantees provided for the
remaining
two master rental agreements.
10.
Adv Botha further contended that by reason
of the use of the word “may” in Rule 42 (1) the Court
retains a wide discretion
even if the statutory requirements of Rule
42 had been satisfied. Consequently, he submitted that I was
justified in having regard
to the absence of a
bona
fide
defence in exercising such discretion.
In this regard he referred to the following judgments:
Tshivhase
Royal Council and Another v Tshivhase and Another; Tshivhase and
Another v Tshivhase and Another
[1992] ZASCA 185
;
1992
(4) SA 852
(A) at 862G to 863C,
First
National Bank of Southern Africa Ltd v Van Rensburg NO and Others: In
re First National Bank of Southern Africa Ltd v Jurgens
and Others
1994 (1) SA 677
(T)
at 681E to G and
Van
der Merwe v Bonaero Park (Edms) Bpk
1998
(1) SA 697
(T) at 702.
11.
Whilst I accept that I
would have been entitled to exercise a discretion, the fact of the
matter is that I exercised my discretion
on an erroneous basis,
namely, on the incorrect assumption that the applicants had to show
the existence of a bona fide defence.
12.
In the circumstances I am of the view that the
applicants have demonstrated that they have a reasonable prospect of
success in this
appeal and that leave to appeal should be granted
against the whole of the judgment even if “incorrect”
service on
the second applicant might only have occurred in relation
to claims B and C and given the disputed interpretation of Clause
(ii)
of the “
terms of business
”
in relation to whether there was “incorrect” service on
the first applicant.
13.
I am in agreement with the submission in the
notice of appeal that leave should be granted to the Full Bench as it
does not warrant
the attention of the Supreme Court of Appeal
ORDER:
1.
Leave to appeal is granted to the Full Bench
against the whole of the judgment granted in this matter on 24 May
2021.
2.
The costs of this application including the costs
of counsel are reserved for the hearing of the Full Bench hearing
this appeal.
___________________
Johann
Gautschi AJ
23
July 2021
Date
of judgment: 23 July 2021
Date
of hearing: 23 July 2021
Counsel
for applicants: Adv Kennedy Tsatsawane SC and Adv Humbulani Salani
Attorneys
for applicants: Ramatshila-Mugeri Attorneys Inc
Counsel
for respondents: Adv JG Botha
Attorneys
for respondents: ODBB Attorneys