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[2018] ZAGPPHC 256
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Minister of Safety and Security v Phakula and Others (HCA19/2015) [2018] ZAGPPHC 256 (22 February 2018)
IN
THE HIGH COURT OF SOUTH AFRICA
(LIMPOPO
DIVISION, POLOKWANE
APPEAL
CASE NO: HCA19/2015
APPEAL
CASE NO: HCA19/2015
In
the matter between:
MINISTER
OF SAFETY AND
SECURITY
APPELLANT
And
OUPA
SIPHO PHAKULA AND
300
OTHERS
FIRST RESPONDENT
TT
MALAHLELAATTORNEYS
SECOND
RESPONDENT
JUDGMENT
M
.G.
PHATUDI J
[1]
Factual Background:
1.1
On 02 November 2012, the plaintiff ("the first Respondent) and
some 300 or so other persons were allegedly
arrested by members of
South African Police Service ("SAPS") without a warrant of
arrest. Pursuant to such arrests, the
plaintiff and his co-arrestees
were detained in the police cells at various police stations in
Sekhukhune area until around 05
November 2012, when they were
released.
1.2
On
15 May 2013, following their arrest and detention, each of the
estimated 300 plaintiffs issued out summons against the appellant
(defendant in the court below) for damages of unlawful arrest and
detention. The particulars of each claim, it appears, were couched
in
similar terms and reciprocally
circumscribed.
[1]
1.3
On 10 September 2013, the plaintiffs' claims were settled on the
basis that the appellant tender payments of an
amount of R30 000.00
capital debt and R3 000.00 in respect of the plaintiff's costs.
1.4
Pursuant
to the alleged settlement, on 29 November 2013 judgment was granted
in
favour
of the plaintiff under case number 424/2013 as claimed.
[2]
It appears from the record that the judgment or orders so granted
were in favour of the plaintiffs. I shall refer to the
judgment/orders
as " orders" for the purpose of
completeness.
1.5
In order to give effect to the court orders referred to, on 02
December 2013 the law firm TT Malahlela Attorneys directed
a letter
to the office the of State Attorney Polokwane in which it was said in
part that:-
"the
court ordered that the court orders attached hereto apply to all 305
matters"
[3]
. Only
one
court
order was however (case no
424/2013)
attached thereto.
1.6
Furthermore
and in pursuance to the afore stated letter, the Second Respondent on
the 14 January 2014 obtained a warrant of execution
against the
appellant's property authorised to
the
value of R33 000.00 inclusive
of
cos
s.
[4]
The
warrant
was
apparently
in
respect
of
th
e
·
plaintiff in case no: 424/2013, namely, one Oupa Sipho Phakula,
better described as "Execution Creditor'' as against
the
appellant.
1.7
Acting on the authority of the said warrant, the sheriff of Polokwane
. on 07 March 2014 subsequently proceeded
to attach certain movable
assets owned by the state and generally used by the department of
Safety and Security at the offices
of SAPS in Polokwane.
[2]
It
seems to me that it was the execution of the warrant by the sheriff
that actuated the launching by the appellant of a rescission
application in the court below
.
[5]
[3]
In the application, the appellant sought a rescission of the orders
granted against it on 29 November 2013, alternatively that
in the
event of any material dispute of fact arising on paper which calls
for the referral of the application to oral evidence,
a stay in
execution of the warrant be granted pending finalisation of the
principal rescission application. The appellant
also prayed for costs
debonis propriis
on a. punitive scale against each 302
respondents in the event of opposition and ancillary relief.
[4]
Mr
TT
Malahlela
in
resisting
the
application
deposed
to
an opposing affidavit on behalf of the Second Respondent in the court
a quo.
[6]
In doing
so,
he
raised
four
points
in
limine
ranging
inter
alia
from
alleged
hearsay evidence in
the
applicant's papers, mis-joinder of himself in the proceedings, the
non-application of section 36 (1) (b) of the Magistrate Court
[7]
Act ("the Act") to Rule 52 of the same Act. (On attorney's
lack of
authority).
I
consider it unnecessary to delve deep into these issues for present
purposes, as they are not wholly material to the present appeal.
The
. application was opposed and the points
in limine
were
disposed of.
[5]
What nonetheless is crucial in this appeal is the correctness or
otherwise of the judgment of the court
a
quo
in having refused to grant a rescission of judgment or orders
granted by it. It is the refusal by the court below of the rescission
of judgment or orders that brought about the present appeal.
[6]
The crisp issues on appeal are essentially whether the judgment O!"
orders sought t6 be rescinded were fraudulently obtained,
or were
void ab origine
as envisaged in section 36 (1) (b) of the
Act.
Section
36 (1) provides that:
"
the court may upon application by any person affected thereby, or, in
cases falling under paragraph (c),
suo motu
(a)-----------------
(b)
Rescind or vary any judgment granted by it which was void aborigine
or was obtained by fraud or by mistake common to the parties".
[7]
Paragraphs (a) ; (c) and (d) of subsection 1 of Section 36 do not, in
my view, find application for purposes of determining
this appeal.
[8]
That said, the next leg of the inquiry is whether or not the Second
Respondent did not misrepresent his mandate to represent
all the
plaintiffs he professed to appear for, when the alleged settlement- .
agreement was reached on 10 September 2013, and thereafter
on 29
November 2013 when the orders were granted.
[9]
In consequence, should it be found on
appeal that the Second Respondent
lacked
original mandate to act on behalf of the 300 or so plaintiffs,
then, naturally,
his
conduct amounts to
fraudulent misrepresentation which hits
cancerously at the roots of
his authority as an attorney of this court in those proceedings. This
finding would invariably have
an adverse effect on the process
leading to the· alleged settlement of the claims and
ultimately, the resultant court orders
and the judgement under
consideration on appeal.
[10]
I now turn to synthesise the facts that led to the initial settlement
prior to the granting of the orders appealed against.
Counsel for the
appellant Mr Maite submitted that the alleged settlement was arrived
at by agreement between the state attorney's
legal representatives·
on behalf of SAPS and the Second Respondents attorney's, whom it was
thought that he has had a genuine
mandate to obtain the orders . on
behalf of the plaintiffs he claimed to represent.
[11]
It was furthermore contended on behalf of the appellant that
subsequent to the orders been granted, it later came to
the
applicant's attention, and unbeknown to the state attorney that the
Second Respondent lacked authority to settle the claims
on the basis
he had done with SAPS legal representative.
[12]
Fortifying its contention as aforesaid, the appellant submitted
several sworn statements deposed to by various deponents,
in which
they disassociated themselves with
any further · interaction with
Mr
Malahlela (Second Respondent) after the criminal charges had been
withdrawn
or
disposed
of,
as
the
case
maybe.
These affidavits
appear
·
in
the
records of appeal before court
in
two separate bundles.
[8]
I deem
it unnecessary to deal piecemeal with the contents of each affidavit.
These would be cumbersome and unduly
tedious.
[13]
Based on these affidavits which were allegedly deposed to by some if
not the majority of some 300 other claimants in
the court below, the
applicant later became aware of the misrepresentation made as and
when the matter became settled. For that
reason, the appellant
submitted that the orders made as a result of the misrepresentation
were fraudulently obtained, and are consequently
void from inception
within the meaning of section 36(1) (b) of the Act. The orders being
void, are therefore liable to be rescinded.
[14]
Counsel
for the respondents, Mr. Van den Ende submitted on ,the other hand,
that the orders granted were not fraudulently obtained
and
therefore
could
not
have
been
void
as
alle9ed
by
the
applicant's
counsel. This submission, in essence was to the effect that Mr
Malahlela had
a
mandate
to settle and
obtain
the orders as granted. It
was
furthermore
argued
that
when
the
application
for
rescission
of
judgement was entertained the Second Respondent had
allegedly
furnished some
232
powers
of
attorney
and
additional
10
of
them
to
the applicant’s
attorneys.
[9]
[15]
I am unable to subscribe to this submission in that from what the
learned counsel had said, it follows that the 232 powers
of attorney
were only displayed to the applicant's attorneys at the door step of·
the court room on 10 September 2013 when
the matter was apparently
settled. The mandate, it appears to me, was only produced
ex post
facto
the day on which the claim became settled as opposed to
when the actions were instituted. I shall revert to this aspect in
the course
of this judgement.
[16]
I now proceed to consider the judgement of the court
a
quo
sought to be appealed against. This is in relation to an
application by the applicant seeking a rescission of judgement or
orders
the court a
quo
made against it.
[17]
The learned Magistrate when considering the points
in
limine
on the applicability or otherwise of section 36
found, and correctly so, in my· view, that:-
"Section36
does not require the applicant to disclose a prima facie defence when
applying for a rescission of judgement. What
is required for the
applicant is to disclose reasons ·for averment that the
judgement was obtained by fraud. The submitted
affidavits discloses
prima facie
basis of fraud. The duty now rests on the
shoulders of the respondents to refute the allegation. This point
in
limine
is not upheld"
[18]
The learned Magistrate in dealing with the question of the Second
Respondent's authority further remarked as follows:-
"On
this issue (mandate) it is obvious that the allegations of lack of
mandate emerged
after
the
judgement
was
granted.
(It
was
possible·
for the), it was· not possible for the issue to be raised
before the judgement. Therefore the point
in
limine
is
dismisse
d
"
[10]
[19]
In providing reasons for his judgment, the learned Magistrate and in
refusing the granting of a rescission of judgment granted
on the 29·
November 2013 held that:-
"The
application (for
rescission)
is
based
on
the
affidavits
submitted.
The starting point is that only (80) eighty affidavits were
submitted.· The court must only confine itself within
(80)
eighty cases because each
deponent
is
only
supporting
his
or
her
case.
We
have
(221)
two
hundred and twenty one cases not supported by the affidavits. The
application for rescission also includes all the cases. The
question
now
is
whether
to
rescind
them
without
supporting
evidence
that
they
were obtained by fraud. It was the duty of the applicant to
submit
those
supporting
affidavits.
In
the
absence
of
those
affidavits
it
is
not
possible
for
the
court
to
grant
rescission
in
those
cases."
[11]
[20]
The learned Magistrate went on to state that:-
"The
reason why the court requested them to read them carefully
(affidavits) was because the majority of the affidavits contradict
themselves. The contradictions are so material that the court could
not simply ignore them. It is important to note that the general
impression created by these affidavits is that no fraud was
committed..."
[21]
It was this finding that perhaps calls for closer scrutiny. The
question in the main upon the hearing of the rescission application
should have been whether or not the Second Respondent as an attorney
of record of the 300 other plaintiffs, initially had legal
standing
or authority to have launched civil action for damages on their
behalf. If the answer is in the affirmative, then
cadit quaestio.
If however, he lacked original mandate, not only upon institution
of the action (s), but also on the purported settlement that amicably
led to the order(s) granted, it follows logically that such
settlement and/or orders were fraudulently obtained. I·n
consequence,
the resultant order(s) are
per
se
void
a
b
·
origine
and should by and
large, have been rescinded. The court
a quo
erred in this
regard.
[22]
The observations and findings made by the court below referred to in
paragraphs 17 and 18 above, are mutually destructive to
the
judgement itself. Not only that, the findings
are throwing the initial ruling with regard to
the point
in
limine
on this aspect deeper into" disarray.
[23]
It is also a matter of grave concern that while the Second Respondent
might have represented some of the plaintiffs during
their first
appearances in the criminal court, (which were withdrawn without
further ado) ex
facie
the sworn statements submitted in
support of the. rescission application, it does not necessarily
follow that, as a matter of principle,
he should have arrogated to
himself the right of authority to sue out summons on their behalf en
masse, not unless he was bestowed
with a General Power of Attorney
collectively by the . plaintiffs as his clients to do so. Absent such
General Power of Attorney,
he could not in my view, have claimed the
right to sue the applicant without proper instructions. His conduct,
properly viewed,
amount to touting which in the attorney's profession
equates unethical or dishonourable conduct on his part.
[24]Accordingly,
the dictum in the judgement forming part of the reasons where it is
stated that "they further explain how
they were arrested and
detained at various police cells, ------- some acknowledges that they
were represented by Mr Malahlela.
-------- only minority knew that
the attorney was arranged for them by the community leaders -------"
could not have led the
court to infer that his appearance in the
criminal court was naturally also intended to confer instructions
upon the Second Respondent
to sue by way of civil suit. This
conclusion and. the reasons advanced are erratic.
[25]
In addition, nowhere in the record of the court a
quo
it
is captured that the parties agreed. alternatively that it was
ordered that all 300 or so matters be
consolidated
and heard
in
tandem
for the purpose of the orders made. What the court
below ordered under case no: 424/2013 involving Mr Oupa Sipho Phakula
and 305
others against the applicant was payment of the amount of R30
000.00 as capital debt plus costs of R3 0_00.00 to be paid into the
Second Respondent's specified banking account. A closer analysis of
the record rules out the judgement or order encompassing the
balance
of other plaintiffs. . Accordingly, the· court order liable to
be rescinded, if necessary, would be the one involving
Mr Phakula
exclusively. The rest, as matters stand, were not properly
adjudicated upon by the court, and remain pending in the
court a
quo.
Whether those claims have become prescribed if pursued is not an
issue before us on appeal.
THE
LEGAL FRAME WORK:
[26]
It is common cause that the appeal orbits around the question whether
or not the provisions of section 36(1) (b) find application
and
whether the reasons proffered by the court a
quo
in rejecting
the rescission application under the said section, hold water. The
relevant provisions are referred to in paragraph
6, above.
[27]
Section 36(1) (b) confers upon a Magistrate court a judicial
discretion whether on application or
suo motu
to rescind or
vary any judgement granted by it which was void originally or was
obtained by fraud or by mistake common to the parties.
In
casu,
no
claim of a mistake common to the parties has been asserted. This
latter part (b) is discarded.
[28]
Accordingly, a party seeking relief under section 36(1) (b) is not
required to establish both jurisdictional factors to succeed
(i.e.
existence of fraud and
voidness ab origine
). It is sufficient
if one of these factors is established on paper, evidentially.
If the court were
mindful of the attorney's lack of authority, first to sue out
summons, negotiate a settlement and ultimately obtain the orders it
granted, it is axiomatic that the court would n t have granted such
orders where fraud was an element in the process.
[29]
In
TODT
V IPSER,
[12]
the
Appellant Division stated that:-
"according
to our common law authorities judgments are void in only three types
of cases, where there has been no proper service,
where there is no
proper mandate or where the court lacks jurisdiction."
[30]
In
casu,
it
is
plain
that
the
appellant
only
became
aware of
the
Second
Respondent's lack
authority
after
the
orders
were
granted
as
a
sequel
to the purported settlement. To that extent, the principle enunciated
in
ROWE
V ROWE
[13]
becomes a useful guide. It recites in part as follows:-
"The
order was granted by consent in terms of an agreement of settlement
which the appellant is alleged to have cancelled on
account of the
respondent's fraud. A party is, of course, entitled to· resile
from any agreement on account of the other
party's fraud and a more
appropriate question would have been whether the fact that the
agreement had been made an order of court
had a nugatory effect on
the right to resile ------." I cannot agree more to the
principle which this court is bound to follow.
This is precisely
because fraud is seen in our law as far-reaching, with the result
that it vitiates every transaction known to
the law. It is an
insidious disease, and affects cancerously the root network of the
transaction, albeit agreed on. Fraud therefore
permeates the entire
civil law, as it even rendered agreements, such as the present
one, voidable at the instance of the
aggrieved party.
See
also
FIRST
RAND
BANK AND
ANOTHER V
MASTER
OF
THE
HIGH
COURT
2014 (2)
SA
527
(WCC)
[31]
Furthermore, in .the present instance, the parties on 10 September
2013, appears to have settled the dispute with the view
to end
litigation or to avert protracted·
and costly litigation. Hence the
agreement is termed in legal parlance a
transactio.
Whether
extra judicial or embodied in an order of court, it has the
effect of
res judicata
and like any other contract and any
order of court, made by consent, it may be set aside on the ground
that it was fraudulently
obtained or on the ground of
iustus
error only if it vitiated true consent,· and not
correlated to the motive or the merits. This is generally akin to
so-called
"consent judgments".
See
also,
GOLLACH & GOMPERTS
(1967) (PTY)
(LTD) V
UNIVERSAL MILLS
&
PRODUCE
60. (PTY) (LTD)
&
OTHERS
·
(1978)
SA 914
(A)
in this regard.
[32]
Because, the nature of the orders granted in the manner described,
are as they stand having a final effect, they are thus
res
judicata.
Ordinarily, the court would be loath to set them aside
lightly. But, the court will intervene if the agreement leading to
the consensual
court order was procured by fraud of the other party.
[33]
In this instance, it is clear that the Second Respondent failed to
submit his authority when called upon to do so by the appellant
when
the application was sought. He instead produced. certain unwarranted
confirmatory affidavits from some few deponents who purport
to
confirm his opposing papers. Such confirmatory affidavits
do not · constitute his authority
to act,
the more so that they were procured much later after the event. Not
even a common law or statutory contingency fee agreement
was raised,
either. Accepting these affidavits was a clear misdirection.
[34]
In
SOUTH
AFRICAN
MILLING
CO
(PTY)
(LTD)
V
REDDY
[14]
th
e
co
u
r
t
appears
to
have
discouraged
the
tendency
where a
party
who sought to cure lack of
locus
standi
in
its founding papers, attempts to do so by rectification or
resolution. Failure to establish original authority, entitles the
respondent to acquire a right to dismiss the
application
on the ground of lack of
locus
standi.
In
this case to allow the confirmatory affidavits as the
court
a
quo
did,
was blatantly prejudicial to
the
appellant's
application for
rescission
of
judgement.
This
was
an
error.
[35]
Similarly,
it was held in
UNITED
METHODIST CHURCH OF SOUTH AFRICA V SOKUFUNDUMALA
[15]
that the ratification of the applicant's
lack
of
locus
standi
in
an attempt to clothe him.' retrospectively with authority would be
prejudicial to the respondent.
[36]
Accordingl
y
,
the Second Respondent
lack
d autho
r
ity
to have brought
the
civil
action
and
resultant
application/s
that
were
ordained
court order/s. As stated in
GANES
AND OTHERS V TELKOM NAMIBIA LTD,
[16]
the principle espoused is plainly that it is the institution and
prosecution
of
the
proceedings
that
must
be
authorised
to
validate
them.
[
37] The submissions therefore made on behalf of the respondents seems
to me to be misconstrued.
The
application for a rescission of judgement was not predicated
under Rule 49 (1) nor 49 (7) of the Magistrate's Court
rules. For the
purpose of section 36(1) (b), it is not required that the appellant
should have set out reasons for absence or default.
The application
had no bearing for absence or default, but had everything to do with
fraud and validity of the consent orders granted,
which were said to
have been fraudulently procured. In this case, I am satisfied from
the record that the application was properly
filed within the time
lines set out in Rue 49 (7), and could, therefore, not be faulted. I
do not agree with the submission that
under Rule 49.
(7)
the appellant should have explained its default. The appellant was
not in default when the orders were made. Its contention
is that the
orders were procured fraudulently as the Second Respondent
misrepresented and/or lacked authority to have purportedly
acted on
behalf of the 300 or so plaintiffs. The confirmatory affidavits
submitted
ex
post
facto
on
rescission application were of no avail.
[38]
As already shown, the submission by the Second Respondent of the 232
powers of attorneys or confirmatory affidavits on the
day of the
hearing of the rescission application was neither_ here nor there.
They were uncalled for. The authority to institute
the civil suit was
of cardinal importance to found his mandate
in civil actions
of th_is nature. The
best he sought to do in producing the powers of attorney, was an
attempt to do damage control.
Again, the confirmatory affidavits
produced do not replace the
locus standi
required in practice.
It is fallacious for the Second Respondent to contend that the
Appellant carried the onus to dispute Mr Malahlela's
presumed
mandate. All what the appellant was obliged to do was merely to show
the grounds set out in Section ·36(1)(b) that
the transaction
was fraudulently obtained and, therefore,
void ab
origine,
nothing more nothing less. This was not a matter of default
judgment where elements of absence of wilful default and bona fides
play a role. I find that the court a
quo
exercised its
discretion improperly.
COSTS:
[39]
39.1
The issue of costs, I thought, deserves special attention. The .
purpose of an award of costs generally, is to indemnify
a successful
litigant who ha incurred costs in the process of litigation. These
are ordinarily the costs which a litigant is indebted
to his/her
attorney.
39.2
The general rule in practice is that the successful party is entitled
to costs of suit. This rule should not lightly
be departed from and
t_he court should be astute in exercising its discretion when warding
costs.
39.3
The underlining dispute on appeal is the fraudulent manner in which
this court finds to" have taken place when the disputed
settlement and ultimately the orders were made. As already shown, the
fraudulent misrepresentation made by the Second Respondent
led
directly to the appellant's attorneys having to settle the matter by
consent judgement. On discovery of the misrepresentation
of his
authority, the appellant sought to seek a rescission of the orders
made. The application was met with stringent opposition
at his
instance.
39.4
The
appellant escalated the matter on appeal seeking relief. Once again,
the appeal was rigorously opposed up to a
point
where it was. argued
before
this
court.
On
the
hearing
of
the
matter,
the
issues
were that of perceived fraudulent misrepresentation of Second
Respondent's
mandate.
39.5
It
is trite that the courts may award costs against a frivolous
litigation on attorney and client costs in circumstances where
dishonesty or fraud has been proven in the
litigation
proces
s
.
[17]
In the presen
t
:
instance, this court finds no justification for departure from the
entrenched rule which has been followed by the courts over
the years.
Accordingly, the Second Respondent by his
conduct, exposed himself to such punitive
costs at own peril.
In any event, both parties · prayed for punitive costs if
successful.
[40]
On the semblance of the facts in this matter, I propose, if I may,
that the appeal on the merits succeeds as follows:-
ORDER:
(a)
The appeal is upheld.
(b)
The decision of the court a quo in refusing to grant a rescission of
judgement or the orders made, is
set aside.
(c)
The judgement or order/s of the court a quo is substituted with the
following order:-
(d)
The court order/s granted on 29 November 2013 is rescinded.
(e)
The Second Respondent is ordered to pay the costs on attorney and
client scale, such costs to include
costs of two counsel.
_________________
MG
PHATUDI
Judge
of the High Court
Limpopo
division
I
concur.
_________________
MV
SEMENYA
Judge
of the High Court
Limpopo
division
REPRESENTATIVES:
1.
For appellant
: Adv. M Gwala
Adv. L.M. Maite
Instructed
by :
State attorney Pretoria
2.
For Respondents
: Adv. I.A. Van den Ende
c/o T.T. Malahlela
attorneys Polokwane
3.
Date heard
: 20 October 2017
4.
Date delivered 22 January 2018
[1]
Annexure " FA 2 ) , vol, pp 40-48 Record
[2]
Annexure " FA 3), vol, pp 49 Record.
[3]
Annexure "FA 4), vol, pp SO Record.
[4]
Annexure "FA 5), vol, pp 51 Record.
[5]
Paginated Index, vol, ppl-27, Record (Rescission application).
[6]
Vol 3, pp 200-209, Record .
[7]
Act 32 of 1944 as amended, r/w Ru le 49(7) & (8) thereof.
[8]
Annexure "FA 7), vol 1, pp 53-The annexure contain several
affidavits denying Mr Malahlela's mandate.
Similar
affidavits appears in ppl-130 of paginated bundle of hand written
statements by affected deponents. It suffices to mention
that the
contents are adverse to M r Malahlela's alleged authority to sue
civilly.
[9]
Paginated pp347-348, vol 4 Record.
[10]
Paginated pp346-3 47, vol 4 Record.
[11]
Paginated Index pp408-410, vol 5, Record (these are the reasons for
judgment re: rescission.
[12]
1993 (3) SA 577
(AD) at 589 "C-D
[13]
[1997] ZASCA 54
;
1997 (4) SA 160
(SCA) at 165 -1 661-J and A-8
[14]
1980 (3)
SA
431
(
SECLD)
[15]
1989 (4) SA 1055
(OPD) at 1057 E-H
[16]
2004 (3) SA 615 (SCA)
[17]
Law society of the Northern Provinces v Mogami 2010 (1 ) 186 (SCA)
at 1961. See also, Buthelezi v Poorter
1975(4)
SA 608 (W).