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[2018] ZAGPJHC 697
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Ridge v Nedbank Limited; In Re: Nedbank Limited v Ridge (2009/31144) [2018] ZAGPJHC 697 (25 October 2018)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO: 2009/31144
In
the rescission of judgment application between:
BERNARD
RIDGE
Applicant
and
NEDBANK
LIMITED
Respondent
In
re the action between:
NEDBANK
LIMITED
Plaintiff
and
BERNARD
RIDGE
Defendant
REPORTABLE
:
NO
OF
INTEREST TO OTHER JUDGES
:
NO
DATE
DELIVERED
:
25/10/2018
JUDGMENT
MASELLE
AJ:
[1]
On 22 September 2009 the respondent, a banking institution (“the
plaintiff”), obtained an order for summary judgment
(“the
order”) against the applicant, an individual (“the
defendant”) for payment of R3 635 555,04 plus
interest and
costs as well as an order declaring the defendant’s immovable
property executable.
[2]
The order was granted by default in the absence of the defendant
under the following circumstances. After the defendant
delivered a notice of intention to defend, the plaintiff timeously
launched and delivered an application for summary judgment.
The
defendant did not deliver an affidavit and at the hearing when the
order was granted, the defendant was not represented by
counsel.
[3]
Some 8 (eight) years after the order was granted, the defendant
launched this application for a rescission of the order.
[4]
The defendant relies on the provisions of rule 42(1)(a) of the
uniform rules of court or failing that, the common law in support
of
his application. There are numerous decisions which set out the
factors to be considered by a court when faced with a rescission
of
judgment based on rule 42(1)(a) or the common law (See for example
Colyn v Tiger Food Industries Ltd t/a Meadow Feed Mills (Cape)
2003
(6) SA 1
(SCA) para 11; Chetty v Law Society, Transvaal
1985 (2)
SA 756
(A): dictum at 764I - 765F; De Wet v Western Bank Ltd 1979
(
2) SA 1031
(A) and the cases cited therein).
[5]
In summary: -
[5.1] The pleaded claim
of the plaintiff is founded on the defendant having failed to make
payments to it, in terms of 6 (six) covering
mortgage bonds. The
plaintiff does not rely on any underlying written loan agreement for
its cause of action. The defendant contends
that there was no claim
for him to meet and upon which summary judgment could have been
granted. In this regard, the defendant
claims, inter alia, that the
causa
debiti
relative
to the amount claimed is not set out in the particulars of claim.
[5.2] The plaintiff
denies that it failed to disclose a cause of action. It submits that
the mortgage bonds are themselves acknowledgments
of the defendant’s
indebtedness to it. The focal point of the plaintiff’s
opposition to the rescission is that the
defendant’s delay in
seeking a rescission is inordinate and unreasonable and, on this
basis, alone the application for rescission
should fail.
[6]
When deliberating whether to rescind an order either in terms of the
common law or rule 42, a court exercises its discretion
(See the SCA
unreported decision of Mosalasuping & others v NC Housing &
others (903/2016)
[2017] ZASCA 121
(22 September 2017) para [14]).
However, given the reasons for my decision as set out below, it is
not necessary to consider whether
(a) the order was either
erroneously sought or granted or (b) the defendant has shown a
bona
fide
defence for it to be rescinded.
[7]
I am of the view that that the rescission should be refused because
the defendant’s delay in seeking a rescission is inordinate
and
unreasonable. Moreover, the facts have an extended history, all of
which lead to the inexorable conclusion that the defendant
has
acquiesced in the order and that the order should not be rescinded.
For understanding purposes, I deal first with peremption
and the
facts and thereafter the unacceptable excessive delay in seeking a
rescission.
Peremption
[8]
In Dabner v South African Railways and Harbours
1920 AD 583
at 594,
the Appellate Division expressed the rule of peremption as follows: -
“
The rule with
regard to peremption is well settled, and has been enunciated on
several occasions by this court. If the conduct of
an unsuccessful
litigant is such as to point indubitably and necessarily to the
conclusion that he does not intend to attack the
judgment, then he is
held to have acquiesced in it. But the conduct relied upon must be
unequivocal and must be inconsistent with
any intention to appeal.
And the onus of establishing that position is upon the party alleging
it.”
[9]
In Tswelopele Non-Profit Organisation v City of Tshwane MM
2007 (6)
SA 511
(SCA) the SCA dealt with whether an appeal had been perempted.
Cameron JA, articulated peremption as follows as para [10]: -
“
[10] Peremption
of the right to challenge a judicial decision occurs when the losing
litigant acquiesces in an adverse judgment.
But before this can
happen, the Court must be satisfied that the loser has acquiesced
unequivocally in the judgment. The
losing party's conduct must
'point indubitably and necessarily to the conclusion that he does not
intend to attack the judgment':
so the conduct relied on must be
'unequivocal and must be inconsistent with any intention to appeal'
(Dabner v South African Railways
and Harbours
1920 AD 583
at 594, per
Innes CJ).”
[10] The rule of
peremption has its origins in appeals. This rule has been extended to
applications for rescission of a judgment
taken by default.
(See Hlatshwayo v Mare and Deas
1912 AD 242
; Sparks v David
Polliack & Co (Pty) Ltd
1963 (2) SA 491
(T) at 496D –
F; and Nkata v FirstRand Bank Ltd and Others
2014 (2) SA 412
(WCC) paras [30] – [31])
[11]
In Venmop 275 (Pty) Ltd and Another v Cleverlad Projects (Pty) Ltd
and Another
2016 (1) SA 78
(GJ), at para [25], Peter AJ summarized
the law in relation to peremption. He observed that: -
“……
An
unsuccessful litigant who has acquiesced in a judgment cannot appeal
against it. The onus of proof rests on the person alleging
acquiescence and in doubtful cases it must be held not to be proven.
Although peremption has its origin in policy considerations
similar
to those of waiver and estoppel, the question of acquiescence does
not involve an enquiry into the subjective state of
mind of the
person alleged to have acquiesced in the judgment. Rather it involves
a consideration of the objective conduct of
such person and the
conclusion to be drawn therefrom (Dabner v South African Railways and
Harbours
1920 AD 583
at 594; Standard Bank v Estate Van
Rhyn
1925 AD 266
at 268; Gentiruco AG v Firestone SA (Pty)
Ltd
1972 (1) SA 589
(A) (1971 BIP 58) at 600A – D; Natal
Rugby Union v Gould
[1998] ZASCA 62
;
1999 (1) SA 432
(SCA) ([1998]
4 All SA 258
;
[1998] ZASCA 62)
at 443F – G; Samancor Group Pension Fund v
Samancor Chrome and Others
2010 (4) SA 540
(SCA) para 25; and
Qoboshiyane NO and Others v Avusa Publishing Eastern Cape (Pty) Ltd
and Others
2013 (3) SA 315
(SCA) ([2012] ZASCA 166) para 3).”
[12]
In SARS v CCMA
2017 (1) SA 549
(CC) at paras [26] to [28], the
constitutionality of the rule of peremption was discussed and
considered regarding whether there
are overriding constitutional
considerations that justify the appealability or the non-enforcement
of peremption. It was
held, inter alia, that: -
[12.1] “
Peremption
is a waiver of one's constitutional right to appeal in a way that
leaves no shred of reasonable doubt about the losing
party's
self-resignation to the unfavourable order that could otherwise be
appealed against.”
[12.2] “
The onus
to establish peremption would be discharged only when the conduct or
communication relied on does ‘point indubitably
and necessarily
to the conclusion' that there has been an abandonment of the right to
appeal and a resignation to the unfavourable
judgment or order.”
[12.3] “
The
broader policy considerations that would establish peremption are
that those litigants who have unreservedly jettisoned their
right of
appeal must for the sake of finality be held to their choice in the
interests of the parties and of justice. But, where
the enforcement
of that choice would not advance the interests of justice, then that
overriding constitutional standard for appealability
would have to be
accorded its force by purposefully departing from the abundantly
clear decision not to appeal.”
[13]
When considering the facts relating to peremption, I am obliged to
consider the objective conduct of the defendant. In his
founding
affidavit, the defendant sets out facts and events which span a
number of years. I have considered only the facts particularized
by
the defendant.
[14]
The facts are as follows: -
[14.1] The defendant was
unaware of the order until the plaintiff issued a writ of attachment
against his property on or about 15
February 2010. He states that he
“
took exception to this high handed conduct and went to see
[the plaintiff] to glean an explanation from them when none was
forthcoming”.
The defendant persisted and this resulted in
meeting with a representative of the plaintiff which occurred on or
about 25 March
2010. At this meeting, the plaintiff “
agreed
to what they call an “assisted sale process” to extract
the maximum value from the property. [The plaintiff]
agreed to freeze
interest on any losses incurred during the sale process, which would
be born 50/50 by the parties. This was encapsulated
in a written
signed agreement.”
The defendant states that he could not
locate his copy of the agreement but “
[the plaintiff] then
appointed an estate agent to market the property. The estate agent
then recommended to [the plaintiff] that
they wait for the sectional
title development to be registered first before proceeding further
which advice [the plaintiff] accepted”
and he was advised
accordingly. In this regard, the defendant says,
inter alia,
that the parties had agreed prior to the granting of the order that a
sectional title development would be opened in respect of
the
property.
[14.2] Thereafter and on
or about 16 August 2010 “
a further agreement was concluded
at the premises of [the plaintiff] when [the defendant] concluded an
agreement with [the plaintiff]
and Toby and Kirsty Rumble”
.
According to the defendant “
this agreement in which both
[the defendant] and [the plaintiff] would participate to the benefit
of both. [The plaintiff] would
receive payment in full of any amount
which it may prove due to it and [the defendant] a healthy surplus.
This agreement constitutes
an abandonment of the judgment taken
against [the defendant] on 22 September 2009 as a new agreement
having its own terms was now
in place.”
The defendant
emphasizes that the sectional title development would be proceeded
with and that a unit would be sold for R500,000.00
and such amount
less anything owed to the municipality would be paid to the
plaintiff. I pause here to point out that, if the defendant
was of
the view that the summary judgment order was abandoned then, on his
own version, he would not need a rescission of the order
which he
seeks.
[14.3] According to the
defendant, the plaintiff breached the agreement concluded in August
2010. The defendant proclaims that the
plaintiff put up the property
for sale because the sectional title registration process was taking
too long. He points out that
he “
approached [the plaintiff]
and remonstrated with them
” whereafter the sale in
execution was cancelled.
[14.4] Then the defendant
states that on 25 September 2012, the property was subdivided and
various portions were created under
a sectional title scheme. He says
that a unit was sold and the proceeds of the sale was paid to the
plaintiff in and around October
2012. The defendant states that he
“
also continued to affect payments in terms of the
arrangement with [the plaintiff”]
. In this regard he
states that “
From October 2012 to date [which is 11
September 2017] [the defendant] had paid a total of approximately
R644,000.00. [The plaintiff]
at no time refused to accept payments
from [the defendant]. By accepting the payments with prejudice, the
[plaintiff] uplifted
any right to take action against [the defendant]
consequent upon any alleged breach. Any claim for payment was thereby
suspended.”
[14.5] Thereafter, on or
about 10 January 2013, the plaintiff issued another writ of
attachment. A unit was attached on 16 April
2013 and the sale thereof
was scheduled for 22 May 2013. On 3 May 2013 the defendant
agreed a payment arrangement with the
plaintiff’s attorneys.
The plaintiff’s attorneys recorded, inter alia, that “
In
the event of any single instalment not being timeously paid, the full
outstanding balance will immediately become due and payable,
and our
client will duly enforce its rights in terms of the judgment order
granted on the 22
nd
of September 2009.”
In terms of the agreement, the defendant made payment to the
plaintiff of the following amounts (a)190,000.00 on 13 May 2013;(b)
R9,724.39 on 13 June 2013; (c)R30,000.00 on 12 June 2013; and (d)
R37,000.00 on 15 July 2013.
[14.6] Subsequently, the
defendant was unable to maintain the instalments. The plaintiff
thereafter caused the property to be put
up for sale by the sheriff
on 16 October 2013. On 14 October 2013, the defendant launched
an urgent application against the
plaintiff in terms whereof he
sought that the attachment of the property and the writ of execution
be set aside. The defendant
did not seek a rescission of the order.
In the founding affidavit the defendant did not raise any complaint
about the order having
been incorrectly granted or that it should be
rescinded. By this time, the order had been in force and effect for
some 4 (four)
years. The application was “
dismissed for lack
of urgency”
.
[14.7] Afterwards, the
property was sold by the sheriff in execution on 16 October 2013 and
the defendant’s attorney advised
him that there was nothing
more that he could do for him. The defendant says that he vacated the
property during March 2014 and
after having done so he consulted with
various people regarding his “
prospects receiving
conflicting points of view”
. It was only after
communicating with his current attorneys during the latter part of
2015 that the defendant decided to “pursue
the matter”.
Moreover, it was only after May 2016 that the defendant’s
current attorney told him that his remedy was
“
to bring an
application for rescission”
which the defendant states is
the first occasion he became aware a rescission of the order was a
step available to him.
[11]
For some 8 (eight) years, the defendant took no steps to rescind the
order. He never reserved his rights or made any payment
to the
plaintiff under protest. His conduct displays an unequivocal
intention to adhere to the order and work with the plaintiff
to
reduce his indebtedness to it and to avoid the sale in execution of
his property. It was only after this lengthy period that
the
defendant had a change of heart regarding the order. This occurred
when he was advised by his current attorneys that he could
seek a
rescission of judgment. He professes that he did not know that he
could seek a rescission prior to him being told by his
new attorneys.
This alleged late knowledge does not help the defendant. His conduct
throughout displayed a clear and unmistakable
intention to comply
with the order. I am of no doubt at all that peremption is applicable
to the facts and the defendant abandoned
any right to rescind the
order.
[12] I am fortified in my
conclusion when having regard to the unreported decision of Kisten
N.O. and Others v Absa Bank Limited
and Others (AR179/15) [2016]
ZAKZPHC 72 (23 August 2016). It was concluded that the Appellants
(who were the defendants in the
court a quo and who had sought a
rescission of judgment which had been refused) had acquiesced in the
granting of the default judgment.
The Court dealt with the facts as
follows: -
“
[15] The
Appellants on no less than six occasions paid the First Respondent
monies to have the sale of the property stayed.
In my view this
conduct amounts to pre-emption (sic) (see Sparks v David
Polliack & Co (Pty) Ltd
1963 (2) SA 491
(t) at 496
D-F). The general position is that ‘no person can be
allowed to take up two positions inconsistent
with one another, or as
is commonly expressed to blow hot and cold, to approbate and
reprobate’. In order to show that
a person has acquiesced
in a judgment, the court must be satisfied upon the evidence that an
act has been done which is necessarily
inconsistent with his
continued intention to have the case reopened on appeal.
[16] The Appellants
paid monies to the First Respondent as mentioned above to stay the
sale of the property on the following dates……
The Appellants conduct
in making these payments in my view is entirely inconsistent with an
intention to have the case reopened
by way of rescission.”
[13]
Given the above, the defendant’s application for a rescission
of the order must fail. The other reason why the application
should
fail, namely that the delay in the defendant launching the
application is inordinate and unreasonable is set out below.
[14]
In terms of rescission under the common law, the relief must be
sought within a reasonable period of time. (see Firestone South
Africa (Pty) Ltd v Genticuro AG
1977 (4) SA 298
(A) at 306H)
Likewise the same applies to a rescission under rule 42(1). (see
First National Bank of Southern Africa Ltd v Van
Rensburg NO and
Others: In re First National Bank of Southern Africa Ltd v Jurgens
and Others
1994 (1) SA 677
(T) at 681B-G). Determining whether a
rescission is sought within a reasonable time period depends on the
particular facts of each
matter.
[15]
The fact that the rescission application was only launched 8 (eight)
years after the order was granted speak volumes.
The
defendant ought to have acted without delay, which he did not do. The
guiding principle of our common law is that there is certainty
of
judgment. (See Colyn
supra
at par [4]). Was the plaintiff entitled to accept that the order was
final? On the facts, I believe so.
[16]
In Hlatshwayo
supra
De Villiers CJ at p248 observed that
“
Where a Court has ordered a judgment to be carried into
execution, the mere payment of the amount or part thereof by a party
condemned
to pay it is no doubt consistent with the intention not to
appeal against it, but it is also consistent with the view that he
paid
to avoid execution, and where the time for noting the appeal has
not expired, he still intends to appeal. “
[17]
Section 34 of the Constitution provides that everyone has a right to
have any dispute that can be resolved by the application
of law
decided in a fair public hearing before a court, or, where
appropriate, another independent and impartial tribunal or forum.
A
judgment granted by default is inimical to this entrenched right. In
RGS Properties (Pty) Ltd v Ethekwini Municipality
2010 (6) SA
572
(KZD) at para [12], Ngwenya AJ dealt with section 34 of the
Constitution, default judgment and a party seeking rescission
thereof.
The learned judge held, inter alia, that: -
“…
.
The
section provides that everyone has a right to have any dispute that
can be resolved by the application of law decided in a fair
public
hearing before a court, or, where appropriate, another independent
and impartial tribunal or forum. Therefore, in my view,
in weighing
up facts for rescission, the court must on the one hand balance the
need of an individual who is entitled to have access
to court, and to
have his or her dispute resolved in a fair public hearing, against
those facts which led to the default judgment
being granted in the
first instance…”
[18]
The common law is mainly designed to enable a court to do justice
between the parties. The decision in RGS Properties
supra
accords with the common law approach. In this regard, a court should
exercise it discretion by,
inter alia
, (a) balancing the
interests of the parties and having regard to any prejudice that
might be occasioned by denying an applicant
the right to have
legitimate issues fully ventilated and properly tried and (b) doing
its best to advance the good administration
of justice which involves
among others, weighing the need, on the one hand, to uphold judgments
of the courts which are taken properly
and, on the other hand, the
need to prevent the possible injustice of a judgment( Se Riddles v
Standard Bank of South Africa Ltd
2009 (3) SA 463
(T) para [15];
Scholtz v Merryweather
2014 (6) SA 90
(WCC) para [11])
[19]
The common law is instructive and helps determine what is a
reasonable time period in which to launch a rescission application.
As a starting point, the 20 (twenty-day) period laid down in Rule
31(2)(b) provides some guidance (Roopnarain v Kamalapathy &
Another
1971 (3) SA 387
(D) at 391B-D). The reason for a time limit
is that there must be finality in litigation and that prejudice can
be caused if rescission
is not promptly sought. (See Nkata supra para
[10]). In Roopnarain supra at p390G-391D a period of 6 (six) months
lapsed from the
date on which the applicant had acquired knowledge of
the judgment and the Court found that a reasonable period had been
exceeded
by a large margin. In First National Bank of Southern Africa
Ltd
supra
it was
found that a reasonable time was substantially less than 3 (three)
years. Notwithstanding the aforegoing,
the
determination of what constitutes a reasonable time remains a
fact-bound inquiry (
See:
Strachan & Co Ltd v Natal Milling Co. (Pty) Ltd
1936 NPD 327
at
333; Cardoso v Tuckers Land and Development Corporation (Pty) Ltd
1981(3) SA 54 (W) 63E)
[20]
On the facts, the plaintiff was entitled to assume that the defendant
had assented to the order. The defendant should have
launched his
application at a much earlier stage. He could have done so after
learning of the order but chose not do so. An unreasonable
time
passed before the defendant sought a rescission. The defendant chose
to launch his rescission application after shopping around
for advice
and eventually receiving legal advice to seek a rescission. It is
fair to say that had the defendant not received advice
to seek a
rescission, the status
quo
of the order being enforceable
would have remained. Certainty and the finality of orders must
prevail. During the entire period,
the plaintiff has been unwavering
in that it held the view that it was at all times entitled to proceed
on the order and in this
regard, it never abandoned its rights. On
the facts before me, the plaintiff was entitled to accept that the
order was a final
order. Seeking a rescission at such a late stage
cannot be countenanced or condoned. I conclude that considering all
of the applicable
factors including the interests of justice, the
order should not be rescinded and must be regarded as final as
between the parties.
[21]
Accordingly, the application is dismissed with costs.
_____________________________
B
W MASELLE
ACTING
JUDGE OF THE HIGH COURT
23
rd
October 2018
Applicants’
counsel: Adv C. Ascar
Instructed
by
:
Thompson Wilks Inc
Respondent’s
counsel: Adv H. Wilson
Instructed
by
:
Bezuidenhout Van Zyl and Associates Inc
Delivered
on: 25 October 2018