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[2021] ZAECELLC 22
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VLG Accounting CC and Another v Koloni Consulting Enterprise CC and Others (95/2021) [2021] ZAECELLC 22 (7 September 2021)
SAFLII
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Certain
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IN
THE HIGH COURT OF SOUTH AFRICA
EAST
LONDON CIRCUIT LOCAL DIVISION
CASE
NO:
95/2021
Date
heard
:
26 August 2021
Date
delivered
:
07 September 2021
In
the matter between:
VLG
ACCOUNTING CC
(Registration
number: 2[...])
First
Applicant
TUNIMART
(PTY) LTD
(Registration
number: 2[...])
Second
Applicant
and
KOLONI
CONSULTING ENTERPRISE CC
(Registration
number: 2[...])
First
Respondent
PUMEZA
GWIJA
(Identity
number: 7[...])
Second
Respondent
VUKILE
POKWANA
(Identity
number: 7[...])
Third
Respondent
ABSA
BANK
Fourth
Respondent
FIRST
NATIONAL BANK
Fifth
Respondent
CAPITEC
BANK
Sixth
Respondent
JUDGMENT
LOWE,
J
INTRODUCTION
[1]
This matter, an application for the re-instatement of a rule
nisi
,
was set down before me on 26 August 2021.
[2]
This application was launched on 22 June 2021, notice to oppose being
given for Respondents on 28 June 2021, the papers being some 51 pages
all in all.
[3]
The history of the matter can be shortly stated.
[4]
On 2 February 2021 Applicants instituted an urgent anti-dissipation
application
against Respondents.
[5]
A Judge’s directive authorised the set down of the matter.
[6]
On 2 February 2021 and
ex parte
Norman AJ issued the following
order in the form of a rule
nisi
as follows:
“
IT
IS ORDERED THAT:
1.
Condoning that the usual forms and services be abridged and that the
application be heard on the basis of urgency
2. A
rule
nisi
hereby issue calling upon the Respondents to show
cause on the 2 March 2021 at 09h30 or soon thereafter as the matter
may be heard
why an order in the following terms should not be made
final:
2.1 The amount of
R9 548 256.40 (Nine million five hundred and forty-eight
thousand two hundred and fifty-six rand forty
cents) and interest
thereon be kept and/or held in the:
2.1.1
First Respondent’s banking account number 409 800 3903
which is held at the Vincent Branch of
Absa in East London or
2.1.2
First Respondent’s banking account number 6230 553 4530 which
is held at the Vincent Branch of First
National Bank or any other
bank account held by First, Second and Third Respondents with ABSA
Bank, FNB Bank or Capitec Bank to
which it has been transferred
pending the outcome of action proceedings which have been instituted
by the Applicants against the
First, Second and Third Respondents for
the recovery of the money owing to Applicants and other ancillary
relief.
3.
Paragraphs 2.1 and 2.2 shall operate as an interim relief and
mandamus
in the Applicant’s favour.
4.
Costs of the application shall be determined in the action
proceedings instituted by the Applicant under case
no. 95/2021
against the First Respondent, on a date within 30 (thirty) days from
the date of this order.”
[7]
Paragraphs 2.1 and 2.2 of the order, that the amount of R9,548,256.40
held in First Respondent’s bank accounts, be kept and held
therein pending the outcome of an action instituted against First
to
Third Respondents for the recovery of the money allegedly owing to
Applicants, was to operate with immediate effect.
[8]
The matter was opposed and answering and replying papers filed.
[9]
The Rule operated until 2 March 2021 and appears to have been
extended
to 20 May 2021 when the matter was set down for hearing.
[10]
On 20 May
2021 the matter came before Mnqandi AJ and an order was made that the
matter “
is
removed from the roll”
with
no order as to costs
[1]
.
[11]
On 1 June 2021, presumably having been again placed on the roll it
was again “
struck off the roll”
by Rusi AJ.
[12]
On 13 July 2021 Tokota J postponed this matter (the reinstatement
application) to 26 August
2021, Applicants to file their replying
affidavit by 18 July 2021.
[13]
The reply was in fact filed on 20 July 2021.
[14]
The need for the reinstatement application arose from the proceedings
having been removed
from the roll on 20 May 2021, no order being made
extending the rule
nisi
on that date. Applicants allege
that this was through no fault of theirs but by oversight of their
legal representative.
[15]
There was a delay in bringing the reinstatement application from 20
May 2021 to its launch
on 22 June 2021, just more than a month later.
[16]
As the matter was opposed and by order of Tokota J on 13 July 2021,
when it was originally
to be heard, was postponed to 26 August 2021
coming before me.
[17]
The main application itself, which had been struck off on 1 June
2021, was not set down
before me and I was informed that by agreement
with the Registrar this was to be heard on 9 September 2021 before
the Duty Judge
on that day as an opposed motion. This renders
the need to give their judgment urgently, in less time than I would
have liked.
THE
RULE
NISI
[18]
A rule
nisi
is an order calling upon Respondents to show
cause, if any, on a fixed date why the rule should not be made
final. It may,
or may not, have interim effect.
[19]
A rule will almost always be granted in an
ex parte
application as in this matter.
[20]
Such
interim order is temporary and provisional
[2]
.
[21]
On the return day of the rule Applicant moves for it to be made
final.
[22]
The
postponement of a rule
nisi
does not, so it has been held, of itself end the rule but
automatically has the effect of excluding the rule according to
Crundall
Brothers (Pvt) Ltd v Lazarus NO and Another
[3]
.
[23]
However,
in my view as a rule
nisi
is
an interim order, and in this matter given
ex
parte
,
it is conditional upon confirmation by the Court. It seems to
me that a Court has no authority to
mero
motu
extend the life of a lapsed order whether or not a rule
[4]
.
[24]
On the
return day of a rule accordingly if a matter is postponed, or as in
this case, removed from the roll with no extension of
the rule and no
date for the matter to be heard in the future, the rule must
automatically lapse – discharging Respondents
from the duty of
compliance
[5]
.
[25]
In any event both counsel in this matter accepted that the Rule had
been discharged by
effluxion of time and non-extension thereof on 20
May 2021.
[26]
It was also
accepted, as I understand it that the return date was not postponed
and that the rule was not dealt with at all
[6]
.
[27]
It was in order to address the issue of a lapsed rule
nisi
(in
the absence of appearance by Applicant) that Rule 27(4) was inserted
into the rules in 1987, and probably as a result of
Fischer v
Fischer (supra)
.
[28]
The rule reads as follows:
“
After a rule
nisi
has been discharged by default of appearance by the applicant,
the court or a judge may revive the rule and direct that the rule
so
revived need not be served again.”
[29]
The trigger
is said to be in “
default
of appearance by the Applicant”.
The
first question is to consider whether this includes a situation where
the parties appear but by agreement (or otherwise) the
matter is
removed by the Court, the file not being in order (as in this matter)
but eh Rule not extended. The rules are for
the Court and not
vice
versa
and
in context the purpose of Rule 27(4) was to lessen the burden on an
Applicant whose rule was discharged due to non-appearance
[7]
.
[30]
The rules
are intended,
inter
alia,
to
expedite the decision of the Court
[8]
.
They are interpreted and applied in a spirit that will facilitate the
work of the Courts and enable litigants to resolve
their differences
in a speedy and inexpensive manner
[9]
.
The Courts do, of course, have inherent jurisdiction to grant relief
should insistence on exact compliance with the Rules
cause injustice
– though exercised sparingly
[10]
.
[31]
In the result it seems to me that the removal from the roll without
extension of the rule,
in this matter, is such as to be essentially
the type of issue which the rule envisages as being subject to
revival on application
in appropriate circumstances.
[32]
If I am wrong in this respect that would be the end of the matter for
Applicants, the rule
not being capable of being simply revived and
the matter then to be such as to have to be brought afresh.
[33]
If a rule
nisi
is such as to be revived, once discharged by
default, the Court may so rule and direct that it need not again be
served.
[34]
This will only occur where there is no possible prejudice. Put
differently if the
interests of the parties may be affected, the rule
is unlikely to be revived.
[35]
The
provisions of Rule 27(4) was considered in
Ex
Parte S & U TV Services (Pty) Ltd: In Re S & U TV Services
(Pty) Ltd (In Provisional Liquidation)
[11]
.
[36]
Harms : Civil Procedure in the Supreme Court, LexisNexis
provides that:
“
B27.9 Revival
of rule
nisi
If
a rule
nisi
is
discharged the court is in principle
functus
officio
and a new application
would be necessary for the same order. The object of the sub-rule is
to lessen the burden on an applicant
whose rule was discharged due to
his failure to appear on the return date. The sub-rule does not
disclose an intention to
override or detract from the rights of other
or third parties, and before the rule can be revived it is necessary
to determine
what the effect of the revival would be. A rule
which lapsed because of the fulfilment of a resolutive condition,
cannot be
revived.”
[37]
In
S & U TV Services
the Court held that:
“
With
no contrary indication gained from the said factors or from any other
source, I conclude that Rule 27(4) discloses no intent
to override or
detract from rights or interests of a litigious opponent or of third
parties. Neither does it diminish the need
to care for such
interests. The application of Rule 27(4) must therefore be
strongly influenced by the particular instance
before the Court.
Crucial
to the said approach would be to determine what effect the revival of
the rule
nisi
would have. Counsel suggested that the
effect would be the same as if the rule had not been discharged on 6
January. This
is what the Rule intended. Rule 27(4) does not mention
a 'new' rule which is then or later confirmed.
In
certain cases, sequestration being an example, a final order may only
be ordered after a rule
nisi
is issued. But it is
not only in such cases that the impact of retrospective continuation
of the discharged rule upon other
parties must receive attention.
This
is not a case where the revival, if ordered, is created almost
immediately after the discharge of the rule, ie while matters
are
still essentially
res
integra
.
Three weeks have expired. The time period is not of importance for
its own sake. It is important because in the present case it
leaves
adequate room for a probability that matters are no longer
res
integra
.
(For that reason a respondent who attends Court and hears the
discharge of the rule
nisi
and
order which interdicted him from certain actions would thenceforth be
able to commit the prohibited actions without being
guilty of
contempt of Court. If the attendance of the respondent is known to
the Court, even the lapse of a very short period may
be adequate
reason why the interdict should not be revived without notice to the
respondent.)”
[12]
[38]
So what effect would the revival of the rule
nisi
have?
Effectively the rule provides for re-instatement as to the original
return date (20 May 2021).
[39]
Usually that is where matters are essentially
res integra
.
The time lapse here goes to the probability, especially relevant to
the preservation of funds, that matters are indeed
res integra.
The lapse of the Rule
nisi
has the effect that the
prohibited action can be committed or performed without being in
contempt of Court.
[40]
The founding papers are essentially limited on the
res integra
issue.
[41]
The answering affidavit points out that the hold was uplifted from
the bank accounts of
First Respondent when the rule
nisi
lapsed
on 20 May 2021.
[42]
The reply fails to be join issue with the question of prejudice to
First Respondent or
the factual issues as to whether the matters are
still essentially
res integra.
[43]
It seems to me to follow that in a matter where an anti-dissipation
interdict is sought
to attach funds in a bank account, and a rule
granted effective immediately, this of itself is likely to cause
potential prejudice
if the rule is later discharged and then revived,
as to the conduct of the bank account in the interim, which in this
matter is
a substantial period.
[44]
The automatic lapse of the rule is such as to raise the injunction on
the bank accounts
and is such to allow First Respondent to utilise
same.
[45]
With a delay of many weeks between lapse on 20 May 2021 and the
launch of the re-instatement
application and the hearing thereof,
there is almost certainly prejudice to the First Respondent, were I
to re-instate the rule
nisi,
which would have retrospective
effect to 20 May 2021.
[46]
The fact
that the lapse of the rule
nisi
was due
to no fault of Applicants cannot in my view change the issues
referred to above in respect of Rule 27(4). The lapse
of the
rule
nisi
although, or so it was argued, due to Applicants’ legal
representative’s error, cannot change the prejudice issue nor
in such circumstances can Applicants rely hereon
[13]
.
[47]
In the
circumstances the application must be dismissed with costs.
This judgment will clearly impact on the main application
to be heard
apparently on 9 September 2021
[14]
,
having regard to the conclusion reached and that the Court is in
principle
functus
officio
as
pointed out in Harms
(supra)
.
ORDER
[48]
In the result the following order issues:
1. The
application for the revival of the rule
nisi
is refused.
2.
Applicants are to pay First to Third Respondents’ costs jointly
and severally the one paying the other
to be absolved including such
costs as were reserved in respect of this application.
M.J.
LOWE
JUDGE
OF THE HIGH COURT
Appearances
:
Obo
Applicants
:
Adv A
Mafu
Instructed by
:
Malusi & Company
Attorneys, East London
Obo
First, Second & Third Respondents
:
Adv T
Sellem
Instructed by
:
Bakumeni Attorneys,
King William’s Town
c/o Gode Attorneys,
East London
[1]
This was, it would appear, because the file had not been placed in
order and the application papers were mixed up with those
of the
trial action.
[2]
Development
Bank of Southern Africa Ltd v Van Rensburg NNO
2002
(5) SA 425
(SCA).
[3]
1991
(3) SA 812 (ZH) 823 G – I.
[4]
MV
Snow Delta
:
Serva
Ship Ltd v Discount
Tonnage
Ltd
2000
(4) SA 746 (SCA).
[5]
National
Director of Public Prosecutions v Walsh & Others
2009
(1) SACR 603
T [24] and [25].
[6]
Fischer
v Fischer
1965
(4) SA 644 (W).
[7]
Manton
v Croucamp NO and Others
2001
(4) SA 374
(W) 380I-381J.
[8]
SOS
Kinderdorf International v Effie Lentin Architects
1993
(2) SA 481
(NM) 491D-R
;
Centre
for Child Law v Hoërskool Fochville and Another
2016
(2) SA 121
(SCA) 131G;
Uramin
(Incorporated in British Columbia) t/a Areva Resources Southern
Africa v Perie
2017
(1) SA 236 (GJ)
[9]
Herbstein & Van Winsen, The Civil Practice of the High Courts,
Fifth Edition, Volume 1 page 30.
[10]
Herbstein
(supra)
30/31.
[11]
1990
(4) SA 88
(W). See also
Commissioner
for the South African Revenue Services v Bachir and Others
(87306/2014)
[2016] ZAGPPHC 251 (22 April 2016).
[12]
90H
– 91C.
[13]
See
Mabudsha
v Commissioner for Conciliation, Mediation and Arbitration and
Others
(JR33472010)
[2014] zalcjhb 57 (9 January 2014). See further
Saloojee
v Minister of Community Development
1964
(2) SA 135
(A);
Xayiya
v African National Congress
[2000]
4 BLLR 477
(LC);
First
National Bank v CCMA
[2000]
12 BLLR 1429
(LC);
A
Hardrodt (SA) (Pty) Ltd v Behardien
(2002)
23 ILJ 1229 (LAC);
Superb
Meat Supplies CC v Maritz
(2004)
25 ILJ 96 (LAC);
GIWUSA
obo Hyeneke v Klein Karoo Korporasie Bpk
(2005)
26 ILJ 1083 (LC).
[14]
See the order made in
Ex
Parte S & U TV
92
– 93.