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[2018] ZAGPJHC 659
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Maseko v Firstrand Bank Limited and Others (16944/2014) [2018] ZAGPJHC 659 (13 December 2018)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO: 16944/2014
In
the matter between
ZODWA
VELA
MASEKO
APPLICANT
AND
FIRSTRAND
BANK LIMITED FIRST
RESPONDENT
THE
DEPUTY SHERIFF OF THE
HIGH
COURT (RANDBURG WEST) SECOND
RESPONDENT
MOTSWAKO
TRADING THIRD
RESPONDENT
KGAUGELO
MABUDUSHA FOURTH
RESPONDENT
REGISTRAR
OF DEEDS FIFTH
RESPONDENT
JUDGMENT
TWALA
J
[1]
This is an opposed application wherein the applicant sought the
following orders:
a) Condoning the
late filing of the application for rescission of the judgments
granted on 5 August 2014 and 27 February 2015;
b)
Rescinding
the judgments granted on 5 August 2014 and 27 February 2015;
c)
In the
event of the judgment being granted, then setting aside the sale in
execution;
d)
Staying
the transfer of the property Erf 87 Broadacres, Extensin 9 Township,
pending the final decision on this application;
e)
Costs
of suit in the event the application is opposed.
[2]
The second to fifth respondents did not file any opposing papers. I
therefor propose to refer only to the first respondent in
this
judgment. Counsel for the first respondent submitted that the parties
have agreed that the application for condonation for
the late filing
of the application for the rescission of judgment is not being
opposed. Therefore, there being no prejudice to
be suffered by any of
the parties, the application for condonation was granted.
[3]
Counsel for the first respondent raised a point in limine at the
start of the hearing in that the applicant did not raise the
issue of
re-instatement of the loan agreement before it was cancelled by the
first respondent due to non-payment of the arrears
in its founding
papers but only in its replying affidavit. It is contended by counsel
for the first respondent that as such, the
issue of the
re-instatement of the loan agreement should be struck out from the
replying affidavit.
[4]
Counsel for the applicant contended that the application for the
rescission of judgment is based on the non- compliance of the
first
respondent with the provisions of section 129 of the National Credit
Act, 34 of 2005 (NCA). Although there is no mention
of the individual
subsections of s 129 in the founding affidavit, it is a subsection of
s 129 which deals with the issue of re-instatement
of the loan
agreement. In the replying affidavit, so the argument goes, the
applicant merely amplified the provisions of s 129
but did not bring
about a new matter.
[5]
I am in agreement with counsel for the applicant that, although the
applicant in its founding affidavit did not specifically
mention the
relevant subsection of s 129 of the NCA or followed its wording, the
application for rescission of judgment is primarily
based on
non-compliance with the prescripts of s 129 by the first respondent.
I am of the view therefore that the point in limine
is ill-founded
and falls to be dismissed.
[6]
It is common cause that on the 21
st
April 2011 the
applicant and the first respondent concluded a mortgage loan
agreement whereby the first respondent loaned the applicant
a sum of
R1 750 000 together with an additional sum of R350 000.
As security for the debt, the first respondent
registered a bond over
Erf 87 Broadacres Extension 9 Township, Registration Division J.R
Province of Gauteng, Measuring 401 Square
Metres, Held by Deed of
Transfer No: T45949/2011. It is further common cause that the street
address of the property is 42 Gateside
Manor, Gateside Streeet,
Broadacres Extension 9, Randburg.
[7]
It is further common cause that the applicant defaulted and fell into
arrears with its payments as per the mortgage loan agreement
as a
result whereof the first respondent launched an application for the
recovery of the outstanding amount. The first respondent
continued to
obtain judgment by default on the 5
th
of August 2014.
[8]
It is contended by counsel for the applicant that, when the applicant
was experiencing financial difficulties, she approached
the first
respondent to enter into some arrangement regarding payment of its
instalments in terms of the loan agreement. She informed
the first
respondent that she was no longer living on the property as she has
rented it out and gave her new cellphone number to
the first
respondent. She never received the s 129 notice, so the argument
goes, for it was sent to a wrong address. If she received
the letter
she would have attended at the offices of the first respondent and to
make suitable arrangements to pay her arrears.
[9]
It is further contended by counsel for the applicant that, the
applicant did not receive the notice of motion although it was
served
at her new address by the sheriff. After she became aware of the
judgment, so it is contended, the applicant paid a sum
total of
R100 000 on the 14
th
and 15
th
of September 2015 to cancel a sale in execution of the property and
to re-instate the loan agreement. The judgment of the 5
th
of August was granted in error as there was non-compliance with the
provisions of s 129 of the NCA and should be rescinded.
[10]
Counsel for the first respondent contended that the s 129 letter was
sent to the domicilium address as per the loan agreement.
The
applicant did not inform the first respondent of the change of
address in writing as required by the loan agreement.
Further,
so the argument goes, the applicant has lost her right to rescind the
judgment as she stated in her e-mail to One Vision
Investment that
the bank has continued to take the property and she has come to terms
with that and she is not contesting it. Since
the applicant
acquiesced this judgment, she is deprived of her right to rescind it.
[11]
It is contended further by counsel for the first respondent that the
applicant made a payment of R100 000 in September
2015 to avoid
and or stop the sale in execution of the property but not to
re-instate the loan agreement as envisaged in the provisions
of s129
of the NCA and the case of Nomsa Nkata v Firstrand Bank Limited and
Others (CCT73/15) [2016] ZACC
[12]
It is trite that, for an applicant to succeed in an application for
the rescission of judgment, it must establish to the satisfaction
of
the Court that it was not in wilful default and that it has a bona
fide defence to the claim of the respondent which is good
in law.
[13]
In
Standard Bank of SA Ltd v Develex 876 CC and Another (70053/14)
[2017] ZAGPPHC 675 (21 September 2017)
the Court stated the
following:
“
The rules
of engagement are different due to the commercial power difference
that exists that justifies the differentiation. In
the instance of s
129 of the NCA, juristic persons have the equivalent of business
rescue proceedings in terms of the Companies
Act whereby the debtor
is given a chance to be rehabilitated from their unmanageable state
of indebtedness, through the aid of
a business rescue practitioner
who takes over the management of their monetary affairs. The process
can be applied voluntarily
or at the behest of a creditor. On the
other hand a natural person who is a consumer under the NCA is
notified of his right to
apply for debt review, which he can then
exercise voluntarily. The process under NCA can be avoided only if it
is not promising
to yield any positive results or its processes have
failed. The difference is that the NCA’s application is
mandatory to
the creditor prior to the enforcement of the debt, as
the purpose is to eradicate or minimise the impact of reckless credit
through
debt review or rescheduling. The differentiation is
rationally connected to the purpose for which the NCA was enacted.”
[14]
In
Sambo v Steytler Boerdery (C592/2013) [2015] ZALCCT 20 (25
March 2015)
the Court stated the following:
“
a party to
legal proceedings who files and then withdraws an application for
leave to appeal cannot apply again because it has clearly
and
unequivocally conducted itself in a manner that is inconsistent with
the intention to appeal.”
[15]
I am unable to agree with counsel for the first respondent that there
was compliance with the provisions of s 129 since the
letter was sent
to the domicilium address. It is clear from the e-mail of the 17
th
March 2014 sent by the applicant to the first respondent that the
applicant informed the first respondent that she has rented out
the
property to raise the bond repayment amount. Further it is her
testimony that she informed the first respondent telephonically
of
her new address and this is not disputed by the first respondent. It
is my respectful view therefore that, having sent the s
129 letter on
the 17
th
February 2014 and having been furnished with the new contact details
of the applicant on the 17
th
March 2014, in order to comply with the provisions of s 129 the first
respondent should have issued another letter in terms of
s129 and
addressed it to the new address of the applicant and has failed to do
so.
[16]
As stated in the case of Develex 876 CC supra, the provisions of the
NCA are mandatory and failure to comply therewith is an
illegality
which cannot be condoned by the court. It would defeat the purpose of
the NCA if non-compliance with the provisions
of s 129 can simply be
condoned where there is no reasonable explanation justifying the
non-compliance.
[17]
In terms of s 129 the creditor may not proceed to institute legal
proceedings to enforce the agreement before first providing
notice to
the consumer informing him of his rights to apply for debt review.
This process can only be avoided if it is established
that it is not
going to produce positive results. There is nothing before this Court
that suggests that the notice in terms of
s 129 was not issued and
addressed to the applicant at her new address for it would not have
brought about positive results. In
my view the legal proceedings
which culminated in the default judgment being entered against the
applicant on the 5
th
of August 2014 are a nullity as they were instituted prematurely. I
therefore hold the view that the judgment of the 5
th
of August 2014 was wrongly entered against the applicant and as such
she is entitled to rescission thereof.
[18]
I respectfully disagree with the contention that the applicant has
forfeited her right to apply for rescission of the judgment
because
on the 13
th
May 2015 she informed One Vision Investment that she has come to
terms and is not contesting the fact that the first respondent
is
taking the property. The applicant stated in the same e-mail that the
issue of the default judgment was never a part of her
instruction to
One Vision Investment and that it is her prerogative to deal with it
in the future. It is on record that the applicant
has launched two
applications for rescission of judgment, the first on the 22
nd
April 2015 and the second on the 11
th
May 2015 having instructed different firms of attorneys and not One
Vision Investment. The ineluctable conclusion is that
the
applicant never abandoned her right to apply for the rescission of
the judgment but was making it clear to One Vision Investment
that
she did not instruct them on the rescission of judgment. Moreover,
two days before writing to One Vision Investment, the applicant
had
launched an application for the rescission of the judgment.
[19]
I agree with counsel for the first respondent that the declaratory
judgment granted by the court on the 27
th
of February 2015 was based on the monetary judgment granted on the
5
th
of August 2014. It is my respectful view therefore that the judgment
of the 27
th
of February 2015 cannot stand on its own since it is depended on the
monetary judgment of the 5
th
August 2014 and therefore falls to be rescinded as well .
[20]
I have noted from the answering affidavit of the first respondent
that the first, third and fourth respondents have, as a result
of
this application, cancelled the sale agreement concluded between them
and therefore prayers 3 and 4 of the notice of motion
have become
mute between the parties.
[21]
In the circumstances, I make the following order:
I.
Both
the judgments granted on the 5
th
August 2014 and 27
th
February 2015
II.
The
first respondent is to pay the costs of this application.
_________________
TWALA
M L
JUDGE
OF THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION
Date
of hearing: 3
rd
December 2018
Date
of Judgment: 13
th
December 2018
For
the Applicant: Mr N.E. Kubayi
Instructed
by: Noveni Eddy Kubayi Inc
TEL:
011 869 5285
For
the Respondents: Adv. VR van Tonder
Instructed
by: Lowndes Dlamini Attorneys
TEL:
011 292 5777