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[2019] ZAWCHC 34
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Copperzone 108 (Pty) Ltd and Another v Gold Port Estates (Pty) Ltd and Another (7234/2013) [2019] ZAWCHC 34 (27 March 2019)
Republic
of South Africa
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
Case
no: 7234/2013
In
the matter between:
COPPERZONE
108 (PTY) LTD First
Defendant/Applicant
AFRIFRESH
GROUP (PTY) LTD Second
Defendant/Applicant
v
GOLD
PORT ESTATES (PTY)
LTD First
Plaintiff/Respondent
OASE
EIENDOMME Second
Plaintiff/Respondent
Court:
Justice J Cloete
Heard:
5 February 2019
Delivered:
27 March 2019
JUDGMENT
CLOETE
J
:
Introduction
[1]
The applicants (the two defendants in the main
action) seek an order separating two issues in terms of uniform rule
33(4). The application
is opposed by one of the respondents (the
first plaintiff or “respondent”). The second plaintiff in
the main action,
Oase Eiendomme, has withdrawn its action against the
defendants.
[2]
The respondent (“Gold Port”) issued
summons in the main action against the applicants (“Copperzone”
and
“Afrifresh” respectively) on 9 May 2013. The
claim is for payment of R2 million, interest and taxed costs
of
R166 647.11 which Gold Port was ordered to pay to Oase Eiendomme
by the North Gauteng High Court on 13 May 2010, a
judgment that
was confirmed on appeal to the Full Bench on 11 February 2013.
[3]
Oase Eiendomme’s claim had been in respect
of estate agent’s commission. The claim arose as a result of
the conclusion
of a written deed of sale between Gold Port and
Copperzone at Groblersdal, Limpopo Province on 24 June 2008, in
terms of which
Gold Port sold to Copperzone certain immovable and
movable property for R40 million and R1.5 million
respectively. In
concluding the sale agreement Gold Port was
represented by the late Mr Gerrit Monray Meyer (“Meyer”),
and Copperzone
by Mr Christiaan Paul Conradie (“Conradie”).
[4]
Clause 23 of the sale agreement provided that no
estate agent’s commission was payable but that:
‘
Indien
enige eis vir agentekommissie ingestel sou word sal dit deur die
KOPER betaal word en vrywaar die KOPER die VERKOPER en stel
hom
skadeloos teen enige eis vir agentekommissie en regskoste wat
ingestel mag word deur enige persoon of instansie.’
[5]
Clause 25 of the sale agreement reads in relevant
part as follows:
‘
25.
BORGSTELLING:
AFRIFRESH
GROEP (EDMS) BEPERK hierin verteenwoordig deur sy Direkteur
CHRISTIAAN PAUL CONRADIE, verbind homself hiermee teenoor
die
VERKOPER as borg en mede-hoofskuldenaar in solidum van die KOPER vir
die behoorlike nakoming deur die KOPER se verpligtinge
in terme van
hierdie ooreenkoms…’
[6]
These clauses, together with the North Gauteng
High Court’s order, are relied upon by Gold Port in claiming
payment consequentially
from Copperzone and Afrifresh. They in turn
have delivered a special plea and a plea. Copperzone has also
delivered a claim in
reconvention.
[7]
The special
plea is to the effect that Gold Port’s claim has prescribed in
terms of s 10(1) read with s 11(d) of
the Prescription
Act.
[1]
It is pleaded that the
debt arose either on 4 July 2008 (when Oase Eiendomme made written
demand to Gold Port), alternatively on
12 February 2009 (when Oase
Eiendomme instituted action in the North Gauteng High Court against
Gold Port).
[8]
The defences raised in the plea are essentially
misrepresentation (that at the time of conclusion of the sale
agreement Meyer represented
to Conradie that no mandate had been
furnished to any estate agent and that accordingly no estate agent’s
commission would
be payable) and, more relevant for present purposes,
a denial that Afrifresh bound itself as surety and co-principal
debtor for
the performance of Copperzone’s obligations (if any)
in terms of clause 23 of the sale agreement.
[9]
Copperzone’s claim in reconvention is for
payment of damages arising from the alleged misrepresentations. The
damages claimed
of R844 787.27 are Gold Port’s legal costs
incurred in defending the action in the North Gauteng High Court and
paid
by Copperzone which, it is alleged, Copperzone would not have
paid on Gold Port’s behalf but for the misrepresentations.
The
separation application
[10]
In the original notice of motion the applicants
sought only an order that the issue of prescription be determined
separately in
terms of rule 33(4). Their attorney, Ms Meyer,
deposed to the founding affidavit. The reasons advanced in support of
the separation
were as follows:
10.1 Should the special
plea succeed, it will dispose of the action;
10.2 The issues raised in
the special plea are “almost entirely” of a legal nature
and can be disposed of expeditiously
and inexpensively –
feasibly in one day;
10.3 On the other hand,
there are several issues on the pleadings that will require evidence
of “a variety of witnesses”
in relation both to the
merits of Gold Port’s claim as well as “questions of
quantum”. Conradie “will in
all likelihood” be one
of them but, given that he will unquestionably be a hostile witness
for the applicants, they will
be required to place him under
subpoena; and
10.4 There can be no, or
no substantial, prejudice to Gold Port if the special plea is
determined separately.
[11]
Conradie is alleged to be a witness of
unquestionable hostility towards the applicants for the following
reason. During 2016 all
the shares in Afrifresh were acquired by
Acorn Agri (Pty) Ltd (“Acorn”). Since shortly after this
acquisition, Acorn
has been engaged in litigation on several fronts
against the erstwhile shareholders and key individuals, including
Conradie. Meyer
submitted that:
‘
Not
only is this likely to place the Defendants at a considerable
disadvantage at the trial, but it may well lead to delays and
incidental interlocutory proceedings relating to the issuing of
subpoenas and possibly even applications to treat witnesses as
hostile.’
[12]
The founding affidavit is silent as to what
evidence (if any) will be required in the determination of the
special plea, despite
the allegation that the issues raised therein
are “almost entirely” of a legal nature. At the time of
deposing to the
founding affidavit on 25 June 2018, Meyer must
have been aware that Gold Port had not filed a replication to the
special plea
and that therefore no admissions had been made in
relation to the dates relied upon by the applicants, in particular
the earlier
date of the first demand.
[13]
More importantly, Meyer did not deal at all with
the claim in reconvention, which would stand irrespective of whether
the special
plea is upheld, and more specifically with the pleaded
arrangement that Copperzone covered Gold Port’s own legal
costs, in
relation to the same factual dispute in respect of which
prescription is now raised, during the North Gauteng High Court
litigation.
Moreover, no case at all was made out for the second
issue now sought to be separated in the amended notice of motion,
namely the
question whether Afrifresh bound itself as surety and
co-principal debtor with Copperzone for the performance of the
latter’s
obligations (if any) in terms of clause 23 of the sale
agreement.
[14]
In the answering affidavit the deponent, Ms
Bondesio (who is one of Gold Port’s directors) pointed out that
the applicants
do not contend that the issues raised in the special
plea of prescription are
entirely
of a legal nature. She submitted
inter alia
that:
14.1 Evidence relating to
the manner in which the parties implemented clause 23 of the sale
agreement is pivotal, both in deciding
the special plea and in
determining the merits and claim in reconvention; and
14.2 Given that Conradie
will have to testify on all of these, as well as the circumstances
giving rise to the inclusion of clauses
23 and 25 (to the extent that
such evidence would be admissible), and given the applicants’
own version that Conradie is
hostile, it is convenient that he
testifies on all of them at once.
[15]
In paragraph 17 of the founding affidavit Meyer
submitted that Gold Port’s right of recourse against Copperzone
and Afrifresh
arose by not later than 4 July 2008, which
according to her was the date upon which
Gold
Port
, in writing, claimed that it was liable
to pay estate agent’s commission. Bondesio pointed out that it
was
not
Gold Port but
Oase Eiendomme which made such a claim on that date. This factual
dispute, which directly relates to the special
plea, was not
addressed by Meyer in the replying affidavit.
[16]
According to Bondesio, it was also Copperzone,
via Conradie, who in fact defended the action in the North Gauteng
High Court on
Gold Port’s behalf, as is evidenced by him having
furnished instructions throughout to Gold Port’s attorneys,
deposing
to an affidavit on behalf of Gold Port resisting summary
judgment, and facilitating payment by Copperzone of Gold Port’s
own legal costs (which, as previously stated, forms the subject
matter of the claim in reconvention). Bondesio accordingly submitted
that Copperzone in fact implemented clause 23 of the sale agreement,
also a factual issue which directly impacts on the determination
of
the special plea.
[17]
In the
replying affidavit Meyer, while accepting that clause 23 is relevant
to the determination of the special plea, disputed that
Conradie
would be able to give any admissible evidence on the interpretation
of the clause itself, and that the applicants therefore
do not intend
calling him as a witness for this purpose. This misses the point. It
is not only the interpretation of the clause
itself which is relevant
(a legal issue) but whether that clause was subsequently implemented
(a factual, disputed issue on the
papers) which require determination
for purposes of adjudicating the special plea. Whether, and in what
manner, the clause was
implemented by Copperzone will entail evidence
that has nothing to do with evidence concerning the negotiations
leading to the
inclusion of clauses 23 and 25 in the sale agreement,
which would likely be inadmissible: see
City
of Tshwane Metropolitan Municipality v Blair Atholl Homeowners
Association.
[2]
[18]
In the replying affidavit Meyer – without
any confirmatory affidavit from either applicant – simply
alleged that their
knowledge of the North Gauteng High Court
litigation is limited to what is contained in the two judgments
arising therefrom. She
also pertinently failed to deal with
Bondesio’s damning allegation that it was Conradie himself who
deposed to an affidavit
resisting summary judgment on behalf of Gold
Port in those proceedings, contenting herself with a generalised bald
denial and,
put bluntly, ducking the issue by contending that the
applicants were not parties to that litigation. Moreover, and again,
Meyer
did not deal at all with the claim in reconvention.
[19]
Attached to the replying affidavit was a notice
of intention to amend the notice of motion, seeking to incorporate
the determination
of whether Afrifresh bound itself as surety and
co-principal debtor with Copperzone as a further separated issue. The
only allegation
made in relation thereto was that:
‘
7.
I accept that the interpretation of clause 23 of the sale agreement
is of relevance in relation to the Defendants’ special
plea.
(For the avoidance of doubt, the Defendants seek to amplify paragraph
1 of the notice of application and I annex hereto marked
“MM1”
a copy of the notice of intention to amend, which has been served on
the Plaintiffs.)’
Discussion
[20]
Rule 33(4) provides as follows:
‘
If,
in any pending action, it appears to the court
mero
motu
that there is a
question of law or fact which may conveniently be decided either
before any evidence is led or separately from any
other question, the
court may make an order directing the disposal of such question in
such manner as it may deem fit and may order
that all further
proceedings be stayed until such question has been disposed of, and
the court shall on the application of any
party make such order
unless is appears that the questions cannot conveniently be decided
separately.’
[21]
There are
conflicting decisions within this Division on whether it is incumbent
on the applicant for a separation of issues to satisfy
the court that
it should be granted. In
Hotels,
Inns and Resorts SA (Pty) Ltd v Underwriters at Lloyds and Others
[3]
it was held that it is for the applicant to do so, whereas in
Braaf
v Fedgen Insurance Ltd
[4]
and
Berman
& Fialkov v Lumb
,
[5]
following
Braaf
,
it was held that it is for the respondent to persuade the court that
a separation should not be granted.
[22]
In the
leading case of
Denel
(Edms) Bpk v Vorster
[6]
the Supreme Court of Appeal explained the purpose of the rule and how
it should be applied, as follows:
‘
Rule
33(4) of the Uniform Rules – which entitles a Court to try
issues separately in appropriate circumstances – is
aimed at
facilitating the convenient and expeditious disposal of litigation.
It should not be assumed that that result is always
achieved by
separating the issues. In many cases, once properly considered, the
issues will be found to be inextricably linked,
even though, at first
sight, they might appear to be discrete. And even where the issues
are discrete, the expeditious disposal
of the litigation is often
best served by ventilating all the issues at one hearing,
particularly where there is more than one
issue that might be readily
dispositive of the matter. It is only after careful thought has been
given to the anticipated course
of the litigation as a whole that it
will be possible properly to determine whether it is convenient to
try an issue separately.’
[23]
In
Molotlegi
and Another v Mokwalase
[7]
the same court stated that:
‘
It
follows that a court seized with such an application has a duty to
carefully consider the application to determine whether it
will
facilitate the proper, convenient and expeditious disposal of
litigation. The notion of convenience is much broader than mere
facility or ease or expedience. Such a court should also take due
cognisance of whether separation is appropriate and fair to all
the
parties. In addition the court considering an application for
separation is also obliged, in the interests of fairness, to
consider
the advantages and disadvantages which might flow from such
separation. Where there is a likelihood that such separation
might
cause the other party some prejudice, the court may, in the exercise
of its discretion, refuse to order separation. Crucially
in deciding
whether to grant the order or not the court has a discretion which
must be exercised judiciously.’
[24]
It thus
seems clear that, irrespective of which party bears the “burden
of persuasion” the court is nonetheless enjoined
to apply its
mind properly and judiciously to whether a separation should be
granted. Self-evidently therefore, it is incumbent
on both parties to
place all relevant information before the court to enable it to
exercise its discretion. If an applicant fails
to do so (as in this
case) it will have to accept that the court may not be in a position
to properly weigh the advantages and/or
disadvantages of granting a
separation. That being said, there are certain guiding principles
that may be gleaned from the case
law. Before dealing with these
principles, it is important to bear in mind that the Supreme Court of
Appeal has in recent times
adopted a strong view that the convenient
and expeditious disposal of litigation is not always achieved by
separating the issues;
that piecemeal litigation is not to be
encouraged; and that the expeditious disposal of litigation is often
best served by ventilating
all the issues at one hearing.
[8]
[25]
The guiding principles are as follows:
25.1 Whether the hearing
on the separated issues will materially shorten the proceedings: if
not, this militates against a separation.
In
Braaf
(
supra
)
[9]
it was said that despite the wording of the subrule, it remains
axiomatic that the interests of expedition and finality are better
served by disposal of the whole matter in one hearing;
25.2 Whether the
separation may result in a significant delay in the ultimate
finalisation of the matter: such a delay is a strong
indication that
separation ought to be refused.
[10]
The granting of the application, although it may result in the saving
of many days of evidence in court, may nevertheless cause
considerable delay in reaching a final decision in the case because
of the possibility of a lengthy interval between the first
hearing at
which the special questions are canvassed and the commencement of the
trial proper;
[11]
26.3 Whether there are
prospects of an appeal on the separated issues, particularly if the
issues sought to be separated are controversial
and appear to be of
importance: if so, an appeal will only exacerbate any delay and
negate the rationale for a separation;
[12]
25.4 Whether the issues
in respect of which a separation is sought are discrete, or
inextricably linked to the remaining issues:
if after careful
consideration of the pleadings, the relevant issues are found to be
linked, even though at first sight they might
appear to be discrete,
it would be undesirable to order a separation;
[13]
and
25.5 Whether the evidence
required to prove any of the issues in respect of which a separation
is sought will overlap with the evidence
required to prove any of the
remaining issues: a court will not grant a separation where it is
apparent that such an overlap will
occur. Such a situation will
result in witnesses having to be recalled to cover issues which they
had already testified about.
[14]
Where there is such a duplication of evidence, a court will not grant
a separation because it will result in the lengthening of
the trial,
the wasting of costs, potential conflicting findings of fact and
credibility of witnesses, and it will also hinder the
opposing party
in cross-examination.
[15]
[26]
Applying these principles to the matter at hand,
I am far from persuaded, on the available information, that a
separation is warranted.
[27]
Rather than materially shortening the
proceedings, a separation will unduly prolong finalisation. The
implementation or otherwise
of clause 23 (upon which the suretyship
in clause 25 hinges) is directly relevant, and inextricably linked,
to the issue of the
special plea of prescription. Evidence will be
required which will have to be given at a later stage, again, at
least insofar as
Copperzone’s claim in reconvention is
concerned. This will in turn result in a lengthening of the trial,
the wasting of costs,
and potentially conflicting factual and
credibility findings. In this regard, it should also be mentioned
that Conradie himself
was one of the witnesses who testified in the
trial in the North Gauteng High Court and credibility findings have
already been
made against him in the judgments of that court. To open
the door, by way of a separation, to a series of potentially
conflicting
factual and credibility findings would not be prudent.
[28]
Further, given the history of the prior
litigation in the North Gauteng High Court, there is every prospect
that the unsuccessful
party in a separated hearing will pursue an
appeal. This will only exacerbate the delay. While Gold Port itself
has dragged its
heels in the main action (its counsel rightly did not
suggest otherwise) the proper administration of justice calls for no
further
or unnecessary delay in bringing this matter to an end on all
of the disputed issues. Moreover, if Conradie is indeed a witness
hostile to the applicants, common sense dictates that the procedural
hoops outlined by the applicants, and relied upon by them,
should be
dealt with in one hearing and not on a piecemeal basis.
[29]
In the result the following order is made:
The application in
terms of uniform rule 33(4) is dismissed with costs, including any
reserved costs orders.
___________________
J
I CLOETE
For
applicants
: Adv J
Muller
SC – 4246993,
Instructed
by: Van Der Spuy Attorneys Cape Town, M Meyer/AFR13/0006, 4193622
For
first respondent
: Adv Danie
Prinsloo
–
012-9422114, 0833810006
Instructed
by: Goosen & Hattingh Attorneys, 013 2612497, Mr J Hattingh, c/o
Fairbridges
(
2
nd
respondent abides
)
[1]
68 of 1969.
[2]
(106/2018)
[2018] ZASCA 176
(3 December 2018) at paras [76] –
[77].
[3]
1998 (4) SA 466
(C) at para [10].
[4]
1995 (3) SA 938
(C) at 939G-H.
[5]
2003 (2) SA 674
(C) at para [17].
[6]
2004 (4) SA 481
(SCA) at para [3].
[7]
[2010] 4 All SA 258
(SCA) at para [20].
[8]
See
inter alia
:
Privest Employee Solutions
(Pty) Ltd v Vital Distribution Solutions (Pty) Ltd
2005
(5) SA 276
(SCA) at paras [26] and [27];
Consolidated
News Agencies (Pty) Ltd (in liquidation) v Mobile Telephone Networks
(Pty) Ltd and Another
2010
(3) SA 382
(SCA) at paras [89] – [91];
Absa
Bank Ltd v Bernert
2011
(3) SA 74
(SCA) at para [21];
South
African Broadcasting Corporation v Democratic Alliance
2016
(2) SA 522
(SCA) at para [67];
First
National Bank – a division of Firstrand Bank Ltd v Clear Creek
Trading 12 (Pty) Ltd and Another
2018 (5) SA 300
(SCA) at para [9]; and
The
City of Tshwane Metropolitan Municipality v Blair Atholl Homeowners
Association
(106/2018)
[2018] ZASCA 176
(3 December 2018) at paras [48] – [53].
[9]
At 941D.
[10]
Netherlands Insurance Co of
SA Ltd v Simrie
1974 (4)
SA 287
(C) at 289B-C.
[11]
Erasmus
Superior Court
Practice
at D1-437.
[12]
Hollard Insurance Co Ltd v
S A Coetzee and Others
(24120/2011)
[2015] ZAWCHC 57
(6 May 2015) at para [15].
[13]
See
Denel
(
supra
)
at para [3];
Consolidated
News Agencies
(
supra
)
at para [89].
[14]
See
Internatio (Pty) Ltd v
Lovemore Brothers Transport CC
2000
(2) SA 408
(SECLD) at 411G-I.
[15]
See
Hollard Insurance Co
(
supra
)
at para 15.7.