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[2019] ZAECMHC 75
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Mbizana Local Municipality v Teyise (CA&R62/2019) [2019] ZAECMHC 75 (26 November 2019)
IN THE HIGH COURT OF
SOUTH AFRICA
(EASTERN
CAPE LOCAL DIVISION-MTHATHA)
CASE NO. CA &
R62/2019
In
the matter between:
MBIZANA
LOCAL MUNICIPALITY
Appellant
and
LUNGISA
TEYISE
Respondent
JUDGMENT
GWALA
AJ
1.
This is an appeal against the decision of the Magistrate for
the
District of Mbizana (the court,
a quo
) in terms of which the
court,
a quo
refused the appellant’s application for the
rescission of the default judgment. In the main the appellant
contends that it
provided adequate explanation for its default and
disclosed a bona fide defence to the respondent’s claim,
therefore the
court,
a quo
erred in dismissing the application
for the rescission of default judgment.
2.
The background to the matter is that the respondent instituted
an
action in the court,
a quo
claiming payment of an amount of
R63, 094.48. The respondent’s claim was that in terms of a deed
of sale entered into between
the appellant and himself he was
entitled to all benefits arising from the property which was the
subject matter of that deed of
sale. On the other hand, the appellant
entered into a lease agreement with a third party in terms of which
the third party was
given permission to place advertising boards on
the walls of the property and paid monthly rental to the appellant.
3.
The respondent claimed that as a result of the lease agreement
the
appellant reaped some benefits from the property which otherwise was
due to him in terms of the deed of sale and thus the appellant
was
somewhat unduly benefited. It then instituted an action in the court,
a quo
claiming that benefit. The appellant defended the action
and appointed attorneys in Mthatha who in turn appointed other
attorneys
back in Mbizana as correspondent.
4.
On Friday 27 January 2017, the respondent served a notice of
bar upon
the correspondent attorneys representing the appellant. The appellant
was required to file its plea within five date from
the date of
service of the notice of bar. The plea was due on 03 February 2017.
The appellant failed to deliver its plea or any
subsequent pleading
within that period and it became
ipso facto
barred.
5.
On 08 February 2017, the appellant delivered a “notice
of
exception” upon the respondent’s attorneys. It contended
that the particulars of claim were vague and embarrassing
and
accordingly afforded the respondent an opportunity to remove the
cause of complaint within 15 days of service thereof failing
which it
would take an exception.
6.
The respondent, apparently, was content with his pleading and
did not
remove the cause of complaint. Instead he filed what he called
“
notice of objection to the proposed exception by the
defendant”
. The appellant on the other hand did not file an
exception as initially indicated despite the fact that the cause of
complaint
was not removed within 15 days.
7.
On 14
September 2017, the respondent took an initiative to deliver upon the
appellant’s correspondent attorneys a notice of
set down in
terms of which the exception was set down for hearing on 13 October
2017. It escapes me what would happen on
13
October 2017. In my view there was no longer an exception to set down
to begin with because the appellant’s notice of exception
had
lapsed when it did not deliver the exception within 10 days upon the
expiry of the 15 days for the removal of complaint which,
as I said,
was not removed.
[1]
8.
As aforesaid, it is not clear what would happen on 13 October
2017.
The following appears though from the reasons for judgment filed by
the court,
a quo
that “…
The matter was set
down for hearing of the exception on 13 October 2017 but was
eventually heard on 04 April 2018. The objection
to the exception
raised by the plaintiff was upheld…”
9.
There does
not appear to be a procedure for objection to exception in the
Magistrate Court Rules. I was unable to find one. Perhaps
what was
intended was to raise an objection that the step taken by the
appellant to file an exception at a time when it was
ipso
fact
barred constituted irregular proceedings in terms of Rule 60A.
However, if that was the intention, the notice of objection did
not
take a form compliant with that Rule in many respects.
[2]
Perhaps the notice of objection was simply a notice to oppose which
ordinarily is not necessary in respect of exceptions.
10.
On 09 October 2018, the respondent delivered a notice of set down
which was
served upon the appellant’s correspondent attorneys.
In terms of that notice the matter was set down for hearing on 26
October
2018. The appellant did not appear in court on 26 October
2018. The court,
a quo
granted the default judgment which was
sought to be rescinded culminating to this appeal.
11.
On 06 December 2018, the appellant delivered an application for the
rescission
of the default judgment which was set down for hearing on
16 January 2019. The application for the rescission of default
judgment was opposed by the respondent. It was opposed on the basis
that the appellant did not give adequate explanation for its
default,
that it failed to disclose
bona fide
defence and that its
founding affidavit was basically hearsay. The founding affidavit was
deposed to by the appellant’s attorneys.
12.
The appellant’s explanation of the default was to the effect
that although
the respondent served the notice of set down upon the
correspondent attorneys, the latter did not bring it to the attention
of
the appellant’s attorneys and that for unexplained reasons
the correspondent attorneys did not appear in court on its behalf.
13.
The court,
a quo
did not accept this explanation. The court,
a
quo
did not accept the founding affidavit in support of the
appellant’s application for rescission of default judgment
either
on the basis that it was hearsay since it was deposed to by
the attorney and not by someone within the appellant or by the person
from the firm of the correspondent attorneys.
14.
The finding that the founding affidavit contained hearsay was, in my
view, incorrect
and cannot be supported. It was the attorney who had
knowledge that he was not furnished with the notice of set down by
his correspondent
attorneys and as such did not know about the set
down. It was the attorney who did not appear in court and only him,
could attest
to the reasons for not appearing in court. Even if the
founding affidavit as a whole contained hearsay, the portion dealing
with
the explanation for default was not hearsay. The court,
a quo
erred in rejecting the founding affidavit.
15.
On the question as to the
bona fide
defence, the appellant
explained that a portion of the respondent’s claim had
prescribed. On the face of it, prescription
was a defence that the
appellant intended to raise once the default judgment was rescinded.
The court,
a quo
equally did not accept that the appellant had
a bona fide defence hence it dismissed the application for the
rescission of the
default judgement.
16.
The defence of prescription is a complete and competent defence in
law. If successful,
it disposes of the claim or a portion thereof. In
this matter the benefits that the respondent sought to recover date
as far back
as 2002. Unless otherwise shown by the respondent
part of the claim indeed has prescribed. Whether it is so or
not
is a matter for this court to decide.
17.
The issue to be decided in this matter was whether there was a good
or sufficient
cause. If there was, then the court,
a quo
erred
in dismissing the application for rescission.
18.
It has
authoritatively been held that an applicant for rescission of default
judgment will show good cause: -
by
giving a reasonable explanation of the default;
by
showing that the application is made bona fide; and by showing that
the applicant has a bona fide defence to the plaintiff claim,
which
prima facie has prospects of success.
[3]
In my
view the appellant satisfied these requisites.
19.
In an
application for rescission of default judgment such as this was, the
law does not require of the applicant to show absence
of gross
negligence on its part. The courts have not accepted that the absence
of gross negligence in relation to the default is
an essential
criterion, or an absolute pre-requisite for the granting of the
rescission.
[4]
20.
Even the
wilful or gross negligence is not determinative of an application for
rescission of default judgment. It is but a factor
to be considered
in the overall determination of whether a good cause has been
shown.
[5]
21.
Importantly,
there is authority that a good defence compensates for a poor
explanation of default.
[6]
As I see it, prescription is a good or substantial defence that would
compensate for any poor explanation. Whether such defence
will
succeed or not is a matter for trial.
22.
The
requirement that the applicant for the rescission of default judgment
must show a good cause is normally satisfied if there
is evidence of
the existence of a substantial defence which the applicant intends to
prosecute conscientiously in the event of
the judgement being
rescinded.
[7]
23.
The
requirement that the applicant for the rescission for default
judgment must show the existence of substantial defence does not
mean
that the applicant must show probability of success in the main
motion or trial. It suffices if the applicant is able to show
a
prima
facia
case, in the form of the existence of an issue which is fit for
trial. It suffices for instance if the applicant sets up some
averments which, if established at the trial, will entitle him/her to
the relief sought.
[8]
24.
In an
application for rescission of default judgment the applicant does not
have to deal fully with the merits of the case. All
that is required
is that the grounds of defence must be set forth in sufficient
details to enable the court to conclude that there
is a
bona
fide
defence and that the application is not made merely for the purposes
of harassing the respondent.
[9]
25.
In this matter I am satisfied that the appellant did explain its
default. It
was not furnished with a notice of set down by the
correspondent attorneys. For that reason, it or its attorneys did not
know that
the matter was set down. In my view, that is a reasonable
explanation. The explanation was wrongly excluded by the court,
a
quo.
It excluded it simply because in its view the affidavit in
support of the application for the rescission of default judgment was
hearsay. The court,
a quo
misdirected itself in this regard.
26.
Even if that explanation was poor, on the authorities referred to
above, the
presence of a
bona fide
defence would compensate
for the poor explanation for the default. Indeed, the appellant
disclosed its defence to the action, namely
that part of the claim
had been extinguished by prescription.
27.
I am satisfied that the appellant did disclose a
bona fide
defence and provided explanation for the default. I have already held
that the court,
a quo
misdirected itself when it rejected the
affidavit in support of the application for rescission of default
judgment on the basis
that it was hearsay.
28.
I am of the view therefore that the appeal should succeed.
Accordingly, I propose
the following order:
28.1
that the appeal is upheld with costs;
28.2
that the order of the court,
a quo
is set aside and
substituted with the following order:
“
1. the application
for the rescission of default judgment is upheld;
2. costs of the
application shall be costs in the main action”.
_________________
M
Gwala
Judge
of the High Court of South Africa (Acting),
Eastern
Cape Division, Mthatha
I
agree, and it is so ordered.
____________________
RWN BROOKS
Judge
of the High Court of South Africa,
Eastern
Cape Division, Mthatha
Counsel
for the Appellant:
Adv Khunju
Counsel
for the Respondent: Adv
Ngumle
Date
of Hearing:
22 November 2019
Date
of Judgment:
26 November 2019
[1]
Rule 19
of the Magistrates’ Court Rules provides:-“
19
Exceptions and applications to strike out
(1)
(a) Where any pleading is vague and embarrassing or lacks averments
which are necessary to sustain an action or defence, the
opposing
party who intends to take an exception shall, within the period
allowed for filing any subsequent pleading, deliver
an exception
thereto, as provided in paragraphs (b) and (c).
(b)
A party who intends to take an exception shall, by notice, within 10
days of receipt of the pleading, afford the party delivering
the
pleading an opportunity of removing the cause of complaint within 15
days of such notice.
(c)
A party who intends to take an exception shall, within 10 days from
the date on which a reply to such notice is received or
from the
date on which such reply is due, deliver the exception.
[2]
Rule
60A of the Magistrates’ Court Rules provides:- Irregular
proceedings
(1)
A party to a cause in which an irregular step has been taken by any
other party
may apply to court to set it aside.
(2)
An application in terms of
subrule (1) shall be on notice to all parties specifying particulars
of the irregularity or impropriety alleged, and may be made only if—
(a)
the applicant has not himself or herself taken a further step in the
cause with
knowledge of the irregularity;
(b)
the applicant has, within 10 days of becoming aware of the step, by
written notice
afforded his or her opponent an opportunity of
removing the cause of complaint within 10 days; and
(c)
the application is delivered within 15 days after the expiry of the
second period
mentioned in subrule (2)(b).
[3]
See
Colyn v Tigger Food Industries Ltd t/a Meadow Feed Meals (Cape) 2003
(6) SA (1) SCA at Para 11; See Also Grant V Plumbers
(Pty) Ltd
1949
(2) SA 470
(O) at 476-477; See also De Wits Auto Body Repairs (Pty)
Ltd v Fedgen Insurance Company Ltd
1994 (4) SA 705
at 708 (H).
[4]
See
Saraiva Contraction Pty) Ltd v Zululand Electrical &Engineering
wholesalers (Pty) Ltd
1975 (1) SA 612
D at 615.
[5]
See De
Witts Auto Body Repairs (Pty) Ltd v Fedgen Insurance Company (Pty)
Ltd
1994 (4) SA 705
at 709 D.
[6]
See De
Witts Auto Body Repairs (Pty) Ltd v Fedgen Insurance Company (Pty)
Ltd
1994 (4) SA 705
at 709 E.
[7]
See
Riddles v Standard Bank of South Africa Ltd
2009 (3) SA 463
(T) Full
Bench para 9
[8]
See
Riddles v Standard Bank of South Africa Ltd Supra at para 9
[9]
See
Riddles v Standard Bank of South Africa Ltd Supra at para 9