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[2021] ZAGPJHC 471
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Kgoadi v First Rand Bank Limited and Others (2020/15557) [2021] ZAGPJHC 471 (27 September 2021)
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG LOCAL
DIVISION, JOHANNESBURG
CASE NUMBER:
2020/15557
REPORTABLE: NO
OF INTEREST TO OTHER
JUDGES: NO
REVISED: NO
27 SEPTEMBER 2021
In the matter between:
KGOADI,
BOITUMELO
Applicant
and
FIRST
RAND BANK
LIMITED
First Respondent
BEZUIDENHOUT
VAN ZYL & ASSOCIATES INC.
Second Respondent
THE
SHERIFF OF COURT (SANDTON)
Third Respondent
THE
REGISTRAR OF DEEDS
Fourth Respondent
JUDGMENT
This judgment is
handed down electronically by circulation to the parties or their
legal representatives via email and by uploading
same onto CaseLines.
The handing down of this judgment is deemed to be 27 September 2021.
MOOKI AJ:
[1]
The applicant brought an urgent application
that came before the Court on 8 July 2020. She sought relief in two
parts. Part A sought
to interdict the respondents from effecting
transfer of title of the subject immovable property. The applicant
seeks declaratory
relief in Part B, namely that the sale in execution
of property be declared null and void; alternatively, set-aside.
[2]
The applicant defaulted on a mortgage bond
held by First Rand Bank Limited (“the Bank”). The bond
pertained to property
that the applicant purchased in 2014. The Bank
issued summons and took default judgement. The Bank obtained an order
on 13 July
2016, authorising the issuing of a writ of execution. This
was followed by a writ of attachment on 21 July 2016. The applicant
was notified of the attachment on 2 August 2016.
[3]
The Bank notified the applicant that the
property was to be sold in execution. The sale was scheduled for 1
November 2016. The applicant
liquidated the arrears before the
scheduled date. The Bank then cancelled the sale.
[4]
The applicant did not pay legal costs. She
later fell into arrears. The Bank scheduled a sale in execution for 7
May 2019. The applicant
made payment arrangements and the Bank
cancelled the sale. The applicant did not comply with the payment
arrangement and the Bank
scheduled a sale in execution for 27 August
2019.
[5]
The applicant launched a rescission
application on 15 August 2019. She then launched an urgent
application on 21 August 2019, which
was enrolled for 26 August 2019.
Her urgent application sought to stay the sale in execution scheduled
for 27 August 2019.
[6]
The parties settled the urgent application.
The applicant made a part payment of the outstanding arrears. She
also tendered costs
incurred by the Bank. The Bank cancelled the sale
scheduled for 27 August 2019.
[7]
The Bank notified the applicant in January
2020 that the Bank had scheduled a sale in execution in relation to
the property. That
followed the applicant again having failed to make
payments. The sale was scheduled for 24 March 2020.
[8]
The High Court in Pretoria heard the
applicant’s rescission application on 3 February 2020. The
applicant sought to have the
judgement rescinded based on what she
says is a misdescription of the property and because there was no
reserve price. The applicant
did not attend in court when the court
entertained her application. The Court dismissed the application and
ordered the applicant
to pay costs on an attorney and own client
scale.
[9]
The sale in execution took place on 24
March 2020. The property was sold on auction for R820 000.00.
[10]
The applicant launched an urgent
application on 8 July 2020, seeking relief as described in paragraph
1. Yacoob J granted relief
sought in Part A. Her order included the
applicant having to join the purchaser as a fifth respondent.
[11]
The applicant did nothing after the order
by Yacoob J. It appears that the Bank then took steps for the Court
to consider Part B
of the relief sought by the Applicant.
[12]
This Court is to determine the relief
sought in Part B. The applicant raises three grounds for the relief
that she seeks; namely:
that the Bank misdescribed the property
during in the notice for the sale in execution; that the Bank did not
comply with the rules
on sales in execution, and that the sale took
place without judicial supervision.
[13]
The applicant says that the Bank did not
comply with Rule 46(7)(b) in describing the property. The
notification of the sale described
the property as having two
bedrooms, when the property had three bedrooms. The applicant submits
that the description materially
affected the price obtained by the
sheriff at the auction. She also says that the description impacted
her right in property.
[14]
The applicant also contends that the
property was not inspected before the auction, the effect being that
bidders bid for a two-bedroom
property, which had a material impact
on the sale, including fetching a lower price than a three-bedroom
property.
[15]
The applicant submits that there should
have been judicial oversight for the following considerations. The
applicant paid and the
agreement continued, which must mean that the
Bank reinstated the agreement. The judgement and execution was
therefore of no legal
force and the Bank could not sell the property
on auction.
[16]
The applicant admits that her payment
history has been disgraceful. She proffered an explanation, including
that she lost her job.
The Bank, on the other hand, maintains that
the applicant repeatedly broke her various promises to pay.
[17]
The applicant says that the Bank was no
longer entitled to rely on the original writ of execution after the
applicant settled the
arrear payments and when the Bank cancelled the
sale scheduled for 1 November 2016. She contends that the Bank is
obliged to obtain
a new writ of execution whenever the applicant paid
off arrears and re-defaulted, as that constituted a new cause of
action. The
applicant contends that the Bank was no longer competent
to seek to execute because the cause of action fell away when the
Bank
put the property for sale by execution in 2016; that the court
order was carried out and the property rendered executable.
[18]
The applicant continues that the applicant
and the Bank entered a settlement agreement for the applicant to
settle arrears and that
the applicant complied. The effect of the
above, according to the applicant, is that the cause of action for
the execution fell
away.
[19]
The applicant says that the Bank had to
follow a particular approach once the bank cancelled the initial sale
in execution. The
Bank, according to the applicant, had to place new
circumstances before a court; including inviting the applicant, as
debtor, to
place new facts before the court.
[20]
The applicant contends that “this
ought to be the proper approach” because banks, otherwise,
“obtain a writ, have
their arrears satisfied and use the same
judgement and writ for all future occasions to harass the debtor,
without a court having
oversight of any change in circumstances.”
[21]
The applicant further avers that the law
changed in 2017 as reflected in Rule 46A(8), which was not the case
in 2016 when the Bank
obtained the court order. The change, according
to the applicant, created a further right and protection for the
applicant, which
obliged the Bank, after 2017, to approach a court
for a reserve price. The Bank did not approach the court for a
reserve price.
[22]
The
applicant contends that it would be unfair for the Bank to execute
and give transfer of the property and that the Bank should
be stopped
“on the basis of good faith and fairness to the applicant,”
as found by the Constitutional Court in
Beadica
231 CC and Others v Trustees for the time being of the Oregon Trust
and Others
.
[1]
[23]
The Bank disputes the contentions by the
applicant. It maintains that the original writ remained in force
until such time as the
applicant had satisfied the judgement in full.
The applicant had not done so, including not having paid legal costs.
The applicant
was also in arrears as set out in the certificate of
indebtedness.
[24]
The Bank disputed the other contentions as
follows: it denied that Rule 46A applied, as that rule had no
retrospective application;
the applicant did not settle arrears and
the reasonable legal costs in full; the Bank does set a reserve
price, which is unknown
to the public. The applicant was aware of
this in her previous applications.
[25]
The Bank denies that the decision in
Beadica applies in the current matter, and points out that the
applicant abused the court process
because there is no finality to
judgements more than four years since the handing down of the
judgements.
[26]
The submission that the judgement should
not have been granted in favour of the Bank because the applicant had
made payments is
unsound. The applicant did not make payments and the
judgement was in consequence of the applicant not meeting her
obligations.
It bears pointing out that the applicant did not defend
the summons and the Bank took default judgement. She was in arrears
in
the amount of R81, 931.21 on 28 January 2020, when the Bank
reminded her of the sale in execution scheduled for 24 March 2020.She
was in arrears in the amount of R103, 903.89 on 12 March 2020,
leading to the sale on 24 March 2020.
[27]
The submission regarding the judgement
being of no legal force is a disguised means to revisit the
rescission application. That
is not permissible. There is no warrant
to disturb the judgement in favour of the Bank. That judgement
specified the applicant’s
indebtedness. The applicant has not
satisfied the indebtedness. The Bank remains entitled to have the
judgement satisfied.
[28]
The various authorities referred to by the
applicant are not applicable. There is no authority that a writ of
execution is extinguished
where a bank cancels a sale in execution
because a judgement debtor settled the arrears leading to the
scheduled sale in execution.
A cancelled sale in execution does not
extinguish the indebtedness as reflected in the court order
underlying the sale in execution.
[29]
There is equally no support for the
applicant’s contention that the Bank had to submit to judicial
oversight every time a
bank seeks to effect a sale in execution. It
would be intolerable, both on the judgement creditor and on the
courts, for a judgement
creditor to obtain a court order every time a
new sale in execution is scheduled because the previous sale was
postponed or cancelled.
The cancellation or postponement of a sale in
execution does not extinguish the writ of execution that underpins
the entitlement
to constitute a sale in execution. There could be any
number of reasons for a scheduled sale in execution being cancelled
or being
postponed. That does not warrant intervention by a court
whenever a new sale is scheduled.
[30]
The issue of “arrear” payments,
properly considered, does not arise in relation to a judgement
creditor. That is because
the whole indebtedness is encompassed in
the judgement amount. In this instance, the Bank obtained judgement
in the amount of R1
041 544.85. This is the applicant’s total
indebtedness to the Bank. The Bank is entitled to execute against
that amount.
[31]
Rule 66 (2) fortifies my view. I do not
accept that the rule operates on a “once-off” basis, as
submitted by the applicant
– namely that the rules contemplate
execution of a judgement in the singular meaning, according to the
applicant, that a
judgement creditor cannot schedule multiple sales
in execution but must return to court should the first sale in
execution not
proceed for whatever reason. Rule 66(2) is clear that a
writ of execution remains in force until a judgement has been
satisfied.
The applicant has not satisfied the judgement in favour of
the Bank.
[32]
I
accept the contentions by the Bank that Rule 46A does not apply to
the Bank. This Court has determined that Rule 46A does not
apply to
execution proceedings that commenced and were pending in terms of
prior execution orders before Rule 46A came into operation
on 22
December 2017.
[2]
[33]
This court has held that:
Execution
is the process for enforcing judgments. It commences with the issue
of a writ of execution in the form prescribed by the
Rules. […].
[3]
[34]
The Bank did not forfeit its right to
execute when it cancelled the scheduled sales. The applicant had not
satisfied the judgement
upon which the writ of execution was issued.
There was no new cause of action when the Bank cancelled the
scheduled sales in execution.
The Bank also did not abandon the
judgement given in its favour. The applicant, as indicated, did not
satisfy the judgement.
[35]
I disagree that the description of the
property in the notice of the sale in execution as a 2-bedroom
instead of a 3-bedroom property
is a ground to declare the sale void
or to have the sale set-aside. There is no requirement in law that
the notice indicate the
number of bedrooms. The notice gave a correct
description of the property as recorded in the sectional titles
scheme. Reference
to “2 bedrooms” was in relation to
“improvements.” The notice was explicit that the
indication of the “improvements”
was not stated as a
fact. Members of the public had the opportunity to inspect the
property if they so chose.
[36]
There was no evidence to support the
contention that the auction would have fetched a higher price but for
the property being described
as a two-bedder.
[37]
I should point out that it is strictly not
necessary for this court to have had to address the complaint on the
reserve price and
the description of the property. That is because
the applicant raised the same complaints in her rescission
application, which
the High Court in Pretoria dismissed. The
applicant is not allowed to relitigate the issues in another court.
[38]
The applicant is a serial defaulter. The
facts of this case illustrate why the case advanced on her behalf,
that the court should
intervene whenever a sale in execution is
cancelled, cannot be sound law. The facts show that the Bank, if the
law was as contended
by the applicant, would have had to obtain at
least four court orders in relation to the applicant not meeting her
obligations
arising from the same cause of action, namely her failure
to meet her obligations under the mortgage bond.
[39]
The applicant invokes the Constitution as
regards “good faith and fairness” in dealings between the
applicant and the
Bank. The Constitution is ill-served and is debased
where it is called in aid by a party to a contract freely-entered
into and
where that party does not meet his obligations. It is
inherent in the Constitution that parties be held to their
undertakings,
within the bounds of the law. The applicant has not
shown that the Bank acted contrary to the law in holding the
applicant to her
undertakings.
[40]
The costs of the proceedings on 8 July 2020
were held over for consideration in relation to part B of the
application. The applicant
should be liable for those costs. The
application, seen in its totality, is an abuse of the court process.
The applicant did not
defend summons by the Bank. She broke her
undertakings to the Bank on multiple occasions, leading to the Bank
cancelling scheduled
sales-in-execution. She launched a rescission
application that she did not prosecute. She raises essentially the
same complaints
in this application as she did in the rescission
application. She did not comply with the court order of 8 July 2020.
She did not
prosecute Part B of the relief that she sought in her
urgent application. It fell to the Bank, on the papers, for Part B to
come
before Court. The applicant would use the Court process to
frustrate the Bank from effecting a lawfully sanctioned order, namely
that the applicant is indebted to the Bank in the amount of R1 041
544.84.
[41]
I make the following order:
1.
The application is dismissed;
2.
The applicant is ordered to pay costs,
including the costs of the application heard on 8 July 2020.
O. MOOKI
Acting Judge of the
High Court
Gauteng Local
Division, Johannesburg
Heard
:
21 July 2021
Judgment
:
27
September 2021
Applicant’s
Counsel
:
Z Khan
Instructed
by
:
Roy Suttner Attorneys
First
Respondent’s Counsel
:
D Strydom
Instructed
by
:
Bezuidenhout van Zyl Attorneys
[1]
2020
(5) SA 247 (CC)
[2]
Williams
and Another v Standard Bank of South Africa Ltd and Another [2019]
ZAGPPHC 364 (3 May 2019),
Para
38
[3]
Williams,
Para
34