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[2018] ZAGPJHC 651
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Mapula Solutions (Pty) Ltd v African Banking Corporation of Zambia Limited and Others (33936/2016) [2018] ZAGPJHC 651 (12 December 2018)
REPUBLIC OF SOUTH
AFRICA
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO: 33936/2016
In
the matter between:
MAPULA
SOLUTIONS (PTY)
LTD Plaintiff
And
AFRICAN
BANKING CORPORATION OF ZAMBIA LIMITED 1
st
Defendant
AFRICAN
BANKING CORPORATION OF BOTSWANA LIMITED 2
nd
Defendant
STANDARD
CHARTERED BANK JOHANNESBURG BRANCH 3
rd
Defendant
STANDARD
CHARTERED BANK BOTSWANA LIMITED 4
th
Defendant
JUDGMENT
TSOKA
J
[1]
The plaintiff, Mapula Solutions (Pty) Limited (Mapula Solutions)
instituted an action against four defendants, three of which
are
foreign companies, for payment of damages in the sum of R163 000 000.
As three of the four companies are foreign companies,
the defendants
after pleading over, raised two special pleas, namely lack of
jurisdiction by this court and prescription of plaintiff’s
claim.
[2]
At the commencement of the hearing of this matter, the parties agreed
in terms of Rule 33(4) to proceed to determine the two
special pleas.
The defendants have since abandoned the special plea of lack of
jurisdiction by this court. Mapula Solutions, however,
prays that the
court must still pronounce that this court has jurisdiction over the
first, second and the fourth defendants. Although
the issue of
prescription is still alive, the parties have diluted that issue by
agreeing that this court should only proceed to
determine whether the
finding by a Judge in an application for rescission of a judgment
obtained by default, where such judgment
was rescinded, is
res
judicata
. The issue of prescription
thus morphed into the defence of
res
judicata
.
[3]
The facts, in brief, that gave rise to the issues are the following.
On 28 February 2017, the four defendants, on urgent basis,
approached
this Court for an application rescinding a default judgment granted
by Maleka AJ in favour of Mapula Solutions on 12
December 2016. The
application served before Weiner J. Having heard the application
Weiner J found that the four defendants were
not in willful default
as the service of the summons, in her view, was irregular. The
default judgment granted against the defendants
was thus rescinded.
[4] The Sheriff’s
Return of service rendered in this matter reads -
‘
This
is to certify that on 28 September 2016 at 15:33 at 6
th
Floor, Green Park Corner, Green Park, Cnr West Road South & Lower
Road, Morningside being the chosen domicillium citandi et
executandi
of Brendan Harmse of TMF Corporate Services (Services) (Pty) Ltd, a
copy of the combined summons was duly served upon
Mrs Trytsman, the
manager, a responsible person, apparently not less than sixteen years
of age after the original document had
been shown and the nature and
contents thereof explained to the said person. Rule 4(1)(a)(v).’
[5]
Although it is common cause that the premises were the chosen
domicilium
address of the defendants, they contended that as the summons were
not served on Brendan Harmse but Mrs Trytsman, the service was
irregular with the fatal result that the said service did not
interrupt prescription hence the contention that Mapula Solutions’
claim against the defendants has become prescribed. It being common
cause that the claim was instituted three years after it arose.
[6]
The crisp issue for determination is therefore whether Weiner J’s
finding that the service was irregular, even though
the default
judgment was rescinded, is
res judicata
.
[7]
The real issue raised by the defendants in the instant matter is what
is the effect of a rescission order, and coupled therewith,
whether a
finding made in a rescission application is
res
judicata
, that is to say, such finding
is final and thus no
lis
may arise therefrom.
[8]
Almost a century ago, De Villiers JP in
Gatebe
v Gatebe
[1]
in finding that an order rescinding a judgment granted by default is
interlocutory in nature and thus not appealable, stated that
such
order does not dispose of any of the issues in the main case and has
no direct effect upon the final issue. The court unequivocally
stated
that such order does “not dispose of the main case or of any of
the issues in the main case, and therefore has not
the effect of a
definitive sentence in this behalf...”
[9]
That an order rescinding a default judgment is not final and
therefore not appealable, has been the law since 1928. Since then,
there has been a line of decided cases affirming this state of the
law. Recently in
Pitelli
v Everton Gartens Projects CC
[2]
,
the court, in determining whether judgments by default are final and
therefore appealable, stated that –
‘
[26]
On the other hand, had the court refused to rescind its order, as it
did, that would clearly have been appealable because it
would have
brought the proceedings to completion in the court of first instance.
And had this court then upheld the appeal, the
matter would have been
remitted to that court to bring the proceedings to completeness.
[27]
An order is not final for the purposes of an appeal merely because it
takes effect, unless it is set aside. It is final when
the
proceedings of the court of first instance are complete and that
court is not capable of revisiting the order.’
[10]
Cadit Quaestio
.
The proceedings of the court of first instance not being complete and
there being a possibility of the order being revisited,
there cannot
be any contention that an issue of
res
judicata
arises. The fact that her
Ladyship in the instant matter in rescinding the judgment found that
the service of the summons was irregular
is of no moment. The
proceedings in that court not having been completed, the issue of
res
judicata,
in my view, does not arise at
all.
[11]
The defendants, however, are of a different view. Although they
readily concede that an order rescinding a judgment granted
by
default is not final and therefore not appealable, they contend that
the pronouncement on the irregularity of service of the
summons is
final, and that, on the authority of
Prinsloo
NO and others v Goldex 15 (Pty) Ltd and Another
[3]
,
the issue of service of the summons has already been decided thus
preventing Mapula Solutions ever raising the issue again.
[12]
I, however, regret to say that the defendants in the instant matter
misunderstood what Brand JA said in Prinsloo. Before restating
what
Brand JA said in Prinsloo I need to say something about the
defendants’ assertion that this court has no jurisdiction
to
hear this matter as the first, second and fourth defendants are
peregrini
.
[13] It has been the
defendants’ stance since the plea was filed that this court has
no jurisdiction in this matter hence
the raising of the special plea
in that regard. This raising of lack jurisdiction of this court was
persisted with in spite of
Her Ladyship Weiner J’s finding that
–
‘
[12]
In my view, there is sufficient connection to find that this Court
had jurisdiction to hear the matter. There does not appear
to be a
more appropriate forum conveniens in which this matter could be
heard.’
[14]
One would have thought that, as the defendants contend with regard to
the service of the summons, that this issue was then
res
judicata
. Contrary to their stance with
regard to the service of summons, they persisted with the contention
that this court lacks jurisdiction
and that issue is still alive. To
the court’s surprise, during argument the issue of lack of
jurisdiction was abandoned.
If there is double speak, this it is!
[15] Returning to the
matter of
Prinsloo
, Brand JA in that matter said –
‘
[10]
The expression ‘res judicata’ literally means the matter
has already been decided. The gist of the plea is that
the matter or
question raised by the other side had been finally adjudicated upon
in proceedings between the parties and that it
therefore cannot be
raised again…In time the requirements were, however relaxed in
situations which gave rise to what became
known as issue estoppel.
This is explained as follows by Scott JA in Smith v Poritt and Others
2008 (6) SA 303
(SCA) para 10:
‘
Following
the decision in Boshoff v Union of Government
1932 TPD 345
the ambit
of the exceptio res judicata has over the years been extended by
relation in appropriate cases of the common-law requirements
that the
relief claimed and the cause of action be the same (eadem res) and
(eadem petendi causa) in both the case in question
and the earlier
judgment. Where the circumstances justify the relation of these
requirements those that remain are that the parties
must be the same
(idem actor) and that the same issue (eadem quaestio) must arise.
Broadly stated, the latter involves an inquiry
whether an issue of
fact or law was an essential element of the judgment on which
reliance is placed. Where the plea of res iudicata
is raised in the
absence of commonality of cause of action and relief claimed it has
become common place to adopt the English law
and speak of issue
estoppel. But, as was stressed by Botha JA in Kommissaris van
Binnelandse Inkomste v Absa Bank Bpk
1995 (1) SA 653
(A) at 669D, 66J
– 671B, this is not to be construed as implying an abandonment
of the principles of the common law in favour
of those of English
law; the defence raised remains one of res iudicata. The recognition
of the defence in such cases will however
require careful scrutiny.
Each case will depend on its own facts and any extension of the
defence will be on a case-by-case basis
(Kommisaris van Binnelandse
Inkomste v Absa (supra) at 670 E-F). Relevant considerations will
include questions of equity and fairness,
not only to the parties
themselves but also to others…’
[16]
The facts in Prinsloo are a mile apart from the facts in the present
case. In that matter the court of first instance was dealing
with the
sale and purchase of a farm. An issue of fraudulent misrepresentation
arose on which the court of first instance made
a finding. When the
seller brought an application for leave to appeal, same was refused.
Special leave to appeal to the Supreme
Court of Appeal was also
refused. Sometime later, the purchasers brought a delictual damages
claim as a result of the fraudulent
misrepresentation. The fraudulent
misrepresentation was denied by the seller. The purchasers replicated
that since the court of
first instance’s finding of fraudulent
misrepresentation, the
exceptio rei
judicata
estopped the seller from
denying the allegation. The plea was upheld. On appeal it was held
that as the seller had no opportunity
to ventilate the issue of
fraudulent misrepresentation, to uphold the plea in the circumstances
would be unfair. The plea of
res
judicata
failed.
[17]
In the present matter, the court of first instance did not delve into
the merits of Mapula Solutions’ claim. Only a preliminary
procedural issue was dealt with. The pronouncement by the court of
first instance did not have any effect on the merits of the
claim.
The proceedings between the parties were not brought to finality. The
pronouncement could not be appealed against. Evidently,
to raise the
issue of
res judicata
estoppel
in the circumstances of this matter would be unfair to Mapula
Solutions.
[18]
I conclude therefore that Mapula Solutions, in the circumstances of
this matter, cannot be prevented to pursue its claim to
finality by
the raising of issue estoppel which in essence is the plea of
res
judicata
.
[19]
Regarding the issue of jurisdiction, it is common cause that the
first defendant although incorporated in England, it is registered
as
an external company in South Africa in terms of the
Companies Act 71
of 2008
. It is authorized to operate its business of a bank in South
Africa by way of a branch under section 18A of the Banks Act 94 of
1990.
[20]
The debt rescheduling agreement (the DRA) which is the basis upon
which Mapula Solutions’ claim is founded, was concluded
on 13
September 2011 at Randburg. The DRA is said to be governed by the
laws of the Republic of South Africa. Any dispute that
may arise from
the DRA, the parties agreed, such dispute may be resolved in South
Africa in accordance with the laws of this land.
The Plaintiff’s
claim against the defendants is joint and several as the factual
events giving rise to Plaintiff’s
claim against the four
defendants are common to each of the defendants.
[21]
In the circumstances, I find that this court is the
forum
conveniens
as there are sufficient links between Mapula Solution’s suit
and this country to render litigation appropriate here rather
than in
the court of the first, second and fourth defendants’ domicile.
See
Bid
Industrial Holdings (Pty) Ltd v Strong and Another (Minister of
Justice and Constitutional Development, Third Party
)
[4]
.
[22] In the result, the
following order is made –
22.1
It is directed that this court has jurisdiction on all the four
defendants;
22.2 The finding by the
court of first instance regarding service of the Summons does not
amount to
res judicata
estoppel;
22.3 The plea of
res
judicata
estoppel is dismissed with costs including the costs of
Senior Counsel.
______________
M TSOKA
JUDGE OF THE HIGH
COURT
Appearances:
For
the Plaintiff: Adv ARG Mundell SC
Instructed
By: MAP Attorneys
For
the Defendant: Adv JP Daniels SC & Adv K Premhid
Instructed
by: Norton Rose Fulbright South Africa Incorporated
Date
of hearing: 1 November 2018
Date
of judgment: 12 December 2018
[1]
Gatebe
v Gatebe
1928 OPD 145
at 149
[2]
Pitelli
v Everton Gartens Projects CC
2010 (5) SA 171
SCA
[3]
Prinsloo
NO and Others v Goldex 15 (Pty) Ltd and Another
2014 (5) SA 297
(SCA) para 10
[4]
Bid
Industrial Holdings (Pty) Ltd v Strong and Another (Minister of
Justice and Constitutional Development, Third Party
2008 (3) SA 355
(SCA) para 55, 56 and 59.