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[2019] ZAFSHC 158
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Absa Bank Limited v Oosthuizen (2062/2017) [2019] ZAFSHC 158 (19 September 2019)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
number:
2062/2017
In
the Matter between:
ABSA
BANK
LIMITED
Plaintiff
and
GERRIT
OOSTHUIZEN
Defendant
CORAM:
POHL,
AJ
HEARD
ON:
19
SEPTEMBER 2019
JUDGMENT
BY:
POHL,
AJ
DELIVERED
ON:
19
SEPTEMBER 2019
INTRODUCTION
AND BRIEF BACKGROUND:
[1]
The Plaintiff and the Defendant entered into an instalment sale
agreement in respect of a tractor. The Defendant however
defaulted with his payments in terms of the said instalment sale
agreement. This led to the Plaintiff issuing summons against the
Defendant. The Defendant did not file a notice of intention to
defend the action after the summons was served on him.
In the
premises, the Plaintiff obtained judgment by default against
the Defendant from the registrar of this Court.
The relevant
default judgment,
inter
alia,
granted
the Plaintiff leave to approach the Court, on the same papers,
duly amplified, for the specific
amount of its damages in terms
of the said default judgment. The Plaintiff approached the
Court in this regard by way of
a “damages affidavit”
setting out the exact amount due and owing to it by the Defendant.
[2]
The Defendant then filed a notice of opposition and a notice of
intention to defend the action. The Defendant’s
case is
in essence that this Court cannot in these circumstances grant the
Plaintiff a “default judgment” in respect
of the specific
amount of damages because he is now defending the matter and he was
entitled to file his notice of intention to
defend the action,
as long as he did it before judgment. The judgment he relies on
is the judgment the Plaintiff seeks
in respect of the amount of
damages to be paid to it by the Defendant. His contention is
that the Plaintiff has to amend
his papers and then go to trial on
this issue. He also raised certain defences emanating from the
National Credit Act, which
will be dealt with infra.
THE
PARTIES:
[3]
The Plaintiff is ABSA Bank Limited, a company duly registered
and incorporated in terms of the relevant statutes of the
Republic of
South Africa, and which conducts business as a retail bank,
with its registered head office in Johannesburg.
[4]
The Defendant is Gerrit Ooosthuizen, an adult male farmer of
the farm Skoongesig, Bultfontein, Free State
Province.
THE
DEFAULT JUDGMENT GRANTED BY THE REGISTRAR:
[5]
The default judgment which was granted in favour of the Plaintiff and
against the Defendant, as far back as 28 August
2017,
reads as follows:
1.
Confirmation
of cancellation of the agreement;
2.
That
the Defendant be ordered to return the following goods and
registration documents to the Plaintiff:
MAKE:
MEGA AGRI
DESCRIPTION:
2014 NEW CLAAS AXION 950 TRACTOR
ENGINE
NR: 00020034392
CHASSIS
NR: ACF950 CABD 4 WD 0119
3.
That
leave be granted to the Plaintiff to approach the Honourable damages.
4.
Further
and/or alternative leave.
THE
NOTICE OF SET DOWN AND DAMAGES AFFIDAVIT:
[6]
In terms of the notice of set down, the Plaintiff seeks the
following orders from the Court against the Defendant:
1.
Payment
of the amount of R963 074.91;
2.
Interest
on the aforesaid amount at the rate of 10.75% per annum from 21
August 2018 to date of final payment;
3.
Costs
of suit on an attorney and client scale;
4.
Further
and/or alternative relief.
[7]
In the damages affidavit, a manager of the Plaintiff,
inter alia,
declares that the Plaintiff sold the tractor
after it repossessed same in terms of the judgment. The amount
that it was sold
for was R2 250 000.00. The
outstanding balance then due thereafter was R963 074.91. A
certificate of
balance issued in terms of the agreement,
confirming this amount , was also attached.
THE
EFFECT OF A JUDGMENT BY THE REGISTRAR:
[8]
Section 23 of the Superior Courts Act, Act 10 of 2013,
provides as follows:
“
A
judgment by default may be granted and entered by the registrar of a
Division in the manner and in the circumstances prescribed
in the
rules, and a judgment so entered is deemed to be a judgment of
a court of the Division”
THE
DISPUTES:
[9]
The core issue in dispute and therefore the first question to be
decided by this Court, is the Defendant’s assertion
that
because he has now filed his notice of intention to defend, the
matter is now properly defended and the Plaintiff is
thus now not
entitled to the relief it seeks on an unopposed (default) basis.
[10]
In deciding this issue, it is first of all necessary to have
regard to the provisions of Rule 19 of the Uniform Rules
of Court.
The relevant portion of Rule 19 (5) reads as follows: (5)
Notwithstanding
the provisions of subrules (1) and (2) a notice of intention to
defend may be delivered even after the expiration
of the period
specified in subrule 2,
before
default judgment has been granted:”
(My
underlining).
[11]
The judgment referred to in Rule 19 (5) refers to a default judgment
in terms of Rule 31 (2) (a), which
inter
alia
provides that: “
Whenever
in an action the claim… is not for a debt or a liquidated
demand and the defendant is in default of delivery of
notice of
intention to defend…the plaintiff may set the action down
….for default judgment and the court may,
after hearing
evidence, grant judgment against the defendant or make such an
order as it deems fit”
[12]
It is important to have regard to the fact that when the summons was
served on the Defendant, the prayers in the summons
contained
exactly the same relief as contained in the default judgment,
referred to in paragraph 5, supra. The Defendant
thus
knew from that day, being the 27
th
of June 2017, that the Plaintiff will approach the Court on the same
papers, duly amplified for damages. Despite this
knowledge, the Defendant chose not to defend the action.
The judgment by default was then obtained by the Plaintiff
on 28
August 2017. The notice of intention to defend was only filed
on 8 August 2019.
[13]
It seems to me that for this defence which was raised by the
Defendant to succeed, I have to find that when the Court
determines and makes an order as to the amount of damages to be
awarded to the Plaintiff, it issues a “separate or
second
judgment”, as opposed to the initial default judgment
grated by the registrar. If I however find that
the
determination of the damages and order of the Court in that regard is
part and parcel of the initial default judgment,
the defence
cannot succeed because the notice of intention to defend was filed
after the default judgment was obtained. In other
words, not as
provided for in Rule 19 (5).
[14]
I find this defence raised by the Defendant rather fanciful. This is
not a matter where the cause of debt is for instance a
delict where
rule 19 (5) may typically find application. The default judgment
deals with one contract, which is cancelled.
It deals with the
very vehicle that form the subject matter of the contract. The
repossession of this tractor and the sale
of the tractor was done
pursuant to the default judgment which was obtained from the
registrar. The amount that is allegedly
due after the sale of
the tractor is inextricably linked to the orders in the default
judgment. It therefore follows that the amount
that the Court will
order as damages flows directly from paragraph 3 of the default
judgment and thus completes that judgment.
If the Defendant
really wanted to defend the action after the default judgment was
granted, he could have and should have
applied for the
rescission of the judgment, either in terms of the ruIes of
Court and/or the common law. He did not
do so. In the premises
I reject this defence raised by the Defendant and find that it has no
substance.
[15]
The second defence raised by the Defendant is that the Plaintiff has
not complied with the provisions of section 127 (5) of
the National
Credit Act, Act 34 of 2005. As a result hereof, so
the argument goes, the Plaintiff is not
entitled to proceed
with its claim against the Defendant regarding the alleged damages or
shortfall resulting from the repossession
and sale of the tractor.
[16]
Section 127 (5) of the National Credit Act reads as follows:
“
(5)
After selling any goods in terms of this section, a credit provider
must-
(a)
credit or debit the consumer with a payment or charge equivalent to
the proceeds of the sale less any expenses reasonably incurred
by the
credit provider in connection with the sale of the goods; and
(b)
give the consumer a written notice stating the following:
(i)
The settlement value of the agreement immediately before the sale;
(ii)
the gross amount realised on the sale;
(iii)
the net proceeds of the sale after deducting the credit provider's
permitted default charges, if applicable, and reasonable
costs
allowed under paragraph (a); and
(iv)
the amount credited or debited to the consumer's account.”
[17]
In the decision of
Edwards v First Rand Bank Ltd t/a Wesbank
2017 (1) SA 316
(SCA), the Supreme Court of Appeal dealt with
the arguments regarding the applicability or not of Section 127 (2) –
(5) of
the National Credit Act and then makes the following finding
in paragraph 16 at page 323:
“
[16]
Whilst generally I am inclined to agree with the proposition that ss
127 (2) – 127 (9) of the Act are applicable,
I however
consider that they are not applicable in the present case
because
the agreement had already been cancelled.”
(My
underlining).
[18]
On 28 August 2017, when the judgment by default was granted,
the
cancellation of the agreement was confirmed
.
I therefore align myself with the
Edwards
-judgment,
supra and thus find that section 127(5) of National Credit Act is
also not applicable in the case before me,
because the
agreement had also been cancelled previously. In the premises I also
reject this defence raised by the Defendant.
[19]
The findings I made in paragraphs 14 and 18, supra, makes
it unnecessary to deal with the Defendants last defence
that deals
with section 128 of the National Credit Act. For the same
reasons it must fail.
[20]
In the premises I make the following orders:
ORDER:
Having
considered the papers filed of record and having listened to Counsel
for both parties, I make the following orders:
1.
The
Defendant must pay the Plaintiff the amount of
R963 074.91;
2.
The
Defendant must pay interest to the Plaintiff on the aforesaid amount
at the rate of 10.75% per annum from 21 August 2018 to
date of final
payment;
3.
The
Defendant must pay the Plaintiff’s costs of suit on the scale
as between attorney and client.
________________
L.
LE R. POHL, AJ
On
behalf of Plaintiff : Adv P J HEYMANS
Instructed
by: E G COOPER MAJIEDT INC
Bloemfontein
On
behalf of the Defendant: Adv C D PIENAAR
Instructed
by: DU PLOOY ATTORNEYS
Bloemfontein