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[2019] ZAFSHC 125
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Firstrand Bank Limited v Schultz NO and Others (6355/2018) [2019] ZAFSHC 125 (25 July 2019)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
No:
6355/2018
In
the matter between:-
FIRSTRAND
BANK
LIMITED
Plaintiff
and
HENNIE
SCHULTZ
N.O
First
Defendant
ELSIE
SCHULTZ
N.O
Second
Defendant
LEONARD
JOHANNES OELOF TRUTER N.O
Third
Defendant
HENNIE
SCHULTS
Fourth
Defendant
CORAM
:
MBHELE J
HEARD
ON
:
25 APRIL 2019
DELIVERED
ON
: 25
JULY 2019
[1]
This is an opposed application for Summary Judgment for payment of
R497 538.90 plus interest in respect of claim 1 and
R1 236
824.20 plus interest in respect of claim 2.
[2]
The first, second and third respondent are cited in the plaintiff’s
simple summons in their capacities as trustees of
the Schultz Family
Trust (IT 55/2014) (The Trust). The Fourth defendant is cited in his
personal capacity and as surety and co-principal
debtor in an
agreement between the plaintiff and the Trust. For the sake of
convenience parties are referred to as in the main
action.
[3]
The plaintiff’s claim pivots on two written agreements entered
into on 29 April 2016;
A
written credit facility agreement in terms of which the
plaintiff is said to have granted the trust a short term credit
facility in the amount of R500 000 and a loan agreement in terms
of which the plaintiff is alleged to have lent and advanced
an amount
of R1 440 000-00 to the Trust at the latter’s special instance.
[4]
The Fourth defendant signed a deed of surety in terms of which he
bound himself as a co-principal debtor
in solidium
with the
Trust, in favour of the Plaintiff, for payment of all monies which
the Trust owed or may owe to the plaintiff, from whatsoever
cause and
howsoever arising.
[5]
Central to the opposition of the Summary Judgment is whether the
causes of action were properly set out in the plaintiff’s
summons and whether the claims are liquidated amounts in money.
[6]
It is the defendants’ case that the plaintiff’s cause of
action is not clearly set out in the summons,
neither was
it verified by the deponent to the affidavit accompanying an
application for Summary Judgment.
[7]
Mr. Van der Merwe on behalf of the defendant submitted that it is not
clear
ex facie
the
simple summons whether the plaintiff’s claim is based on a
credit facility provided at the Trust’s special request
and
instance or whether such claim is based on a written agreement or a
partially written, partially verbal agreement.
[8]
The defendants take issue with the facility agreement which provides
that any amounts owing to the plaintiff shall bear
interest
at a rate equivalent to the
maximum allowable interest rate under the Usury Act 73 of 1968 for as
long as such amount remained unpaid
interest
,
which additional interest
is
calculated daily and capitalised monthly. The agreement further
allows the plaintiff to use its sole discretion to charge
the
additional interest at a rate less than the maximum allowable
interest rate under the Usury Act.
[9]
Mr Van der Merwe further contended that it is not clear from the
summons whether
the
plaintiff exercised its discretion to charge additional interest as
stipulated in the agreement,
[10]
It is further contended that the plaintiff failed to set out whether
the amounts claimed consist solely of the capital outstanding
or
whether such amounts include interest and at which rate such interest
has been charged. In his view the claim is not for the
liquidated
amount in money as envisaged in Rule 32.
[11]
The plaintiff asserts that the defendants failed to prove that the
plaintiff charged additional interest and whether such interest
was
in terms of the repealed Usury Act or the National Credit Act.
Mr
Groenewald submitted that the defendants could have easily
ascertained the rate at which interest was charged from the bank
statements provided by the plaintiff prior to the issuing of summons.
He submitted further that the defendants agreed that
in case of
dispute arising from both the facility agreement and the loan
agreement the certificate of indebtedness, signed by a
manger of the
Plaintiff, shall be prima facie proof of the amount owed by the
respective defendants to the plaintiff until the
contrary is proven.
He contended further that since the Usury Act was repealed by the
National Credit Act, the plaintiff may claim
interest in terms of the
National Credit Act.
[12]
Clause 5 of the general terms and conditions applicable to the
facility agreement, signed by the parties, provides as follows
when
dealing with penalty interest.
“
Any
amount(s) owing to the Bank which are not paid on due date, shall
bear additional interest at a rate equivalent to the maximum
allowable rate under the Usury Act 73 of 1968 (as amended) to the
extent applicable, for as long such amount(s) which are due and
payable remains unpaid, which additional interest are calculated on
daily balance and capitalised monthly.
In the event of breach,
the Bank shall be entitled to claim and charge penalty interest at a
rate equal to the maximum allowable
rate under the Usury Act 73 of
1968 (as amended) to the extent applicable, calculated from the date
of breach to the date of payment
and compounded monthly in arrears,
on the full outstanding balance of the facilities.
The Bank in its sole
discretion and without derogating from any other rights that the Bank
may have, reserves the right to charge
additional interest as set
forth in this clause 5 at a rate less than the maximum allowable rate
under the Usury Act (to the extent
applicable).”
[13]
Summary Judgment is a procedure intended to prevent sham defences
from defeating the rights of parties by delay and further
causing
great loss to plaintiffs who were endeavouring to enforce their
rights. It is a procedure aimed at affording an innocent
plaintiff who has an answerable case against an elusive defendant a
much speedier remedy than that of waiting for the conclusion
of an
action. Summary Judgment must be refused where the defendant has a
triable case. See
(
Joob Joob Investments Pty ( Ltd) v Stocks Mavundla Zek Joint Venture
2009 ( 5) SA (1) .
[14]
In
Shepstone v Shepstone
1974 (2) SA 462
E – H
the following was
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”
[15]
I must consider whether the National credit Act finds application in
the first claim. It is common cause that the Trust has
3 Trustees and
that the agreement in claim 1 was for credit facility in the amount
of R 500 000.
[16]
In
terms of section 4(1)(a) of the National
Credit Act the Act does not apply to a credit agreement in
terms of which the consumer
is:
(i)
a
juristic person whose asset value or annual turnover, together with
the combined asset value or annual turnover of all related
juristic persons, at the time the agreement is made, equals or
exceeds the threshold value determined by the Minister in
terms
of section 7(1) (currently R1 million) ;
(ii)
a large agreement as described in section 9(4)
(b) (the principal debt under the transaction exceeds R250 000)
in terms of
which the consumer is a juristic person, whose asset
value or annual turnover is, at the time the agreement is made, below
the
threshold value (R1 million) determined by the Minister in terms
of section 7(1) of the Act.
[17]
It is so that the National Credit Act does not
apply where the consumer is a juristic person which enters into a
large agreement,
irrespective of its total asset value or annual
turnover. In the current matter the trust is considered a juristic
person as described
by the National Credit Act. The principal debt
exceeds the R250 0000 as determined by the Minister. Based on
the above the
National credit Act does not apply to the credit
facility.
[18]
A liquidated amount in money is an amount which is
either agreed upon or which is capable of speedy and prompt
ascertainment or
where the ascertainment of the amount in issue is ‘a
matter of mere calculation. See (
Tredoux v
Kellerman
2010 (1) SA 160
CPD
)
[19]
In
Botha v W.
Swanson
and Co. (Pty) Ltd
it was held that a claim
would not be regarded as one for a liquidated amount in money unless
it was based on an obligation to
pay an agreed sum of money or it was
so expressed that the ascertainment of the amount so claimed was a
matter of a mere calculation
[20]
Pleadings in general are governed by Rule 18 of the Uniform Rules of
court, (Rules).
“
18 (4) Every pleading shall
contain a clear and concise statement of the material facts upon
which the pleader relies for his claim,
defence or answer to any
pleading as the case may be, with sufficient particularity to enable
the opposite party to reply thereto”.
The
manner in which the plaintiff formulated its claims does not fully
satisfy the requirements set out in Rule 18. The amounts
claimed are not easily ascertainable.
[21]
With the Usury Act having been repealed and the National Credit Act
not finding application to the credit facility and the
loan
agreement, interest has to be calculated in terms of the
Prescribed
Rate of Interest Act 55 of 1975
. It is not clear from the summons
whether the additional interest, on the outstanding amount due, was
added, if added, at what
rate was it calculated.
Summary
judgment must be granted where it is clear that the plaintiff’s
claim is unimpeachable and the defendant‘s case
is bogus and
bad in law. The plaintiff’s summons does not state with
particularity how the claims were formulated and
how the total amount
owing was arrived at.
The
plaintiff must prove that its claim is unanswerable before I could
exercise my discretion to grant summary judgment. Based
on the above, I am unable to say with certainty that the plaintiff’s
claim is unanswerable. The defendants demonstrated that they have a
bona fide defence to the claims. The application for summary
judgment
must fail.
ORDER
1.
The application for
summary judgments in respects of both claims is dismissed.
2.
The defendants are
granted leave to defend.
3.
Costs shall be costs in
the cause.
_____________
NM
MBHELE, J
On
behalf of the plaintiff: Adv. WJ GROENEWALD
Instructed
by:
SYMINGTON & DE KOK INC
.
BLOEMFONTEIN
On
behalf of the defendant: Adv. R. VAN DER MERWE
Instructed
by:
MAREE
& VENNOTE ATTORNEYS
BLOEMFONTEIN