Brief Summary

Execution — Summary judgment — Defective application — Appellants appealed against summary judgment granted in favour of the respondent, arguing that the application was filed out of time and lacked necessary documentation — Court held that the summary judgment application was indeed defective as it did not comply with procedural requirements, including the failure to attach the written agreement that formed the basis of the claim — Summary judgment set aside.

Comprehensive Summary

Summary of Judgment

1. Introduction

This judgment concerns an appeal to the Free State Division of the High Court against an order of summary judgment granted in the Magistrate’s Court, Bloemfontein. The appeal was heard by Rampai J and Daffue J, with the judgment delivered by Daffue J.

The appellants were the defendants in the court a quo, namely Phofung Project Consulting (Pty) Ltd (alleged principal debtor) and Mr Daniel Pocklington Erasmus (alleged surety). The respondent was The Standard Bank of South Africa Ltd, the plaintiff in the court a quo, which had succeeded in obtaining summary judgment.

The procedural history was that the bank issued a simple summons in the Magistrate’s Court and thereafter brought an opposed summary judgment application. The Magistrate’s Court granted summary judgment jointly and severally against both defendants for the capital amount, interest, and attorney-and-client costs. The defendants then appealed, contending primarily that the summary judgment proceedings were fatally defective and should not have been granted.

The general subject matter of the dispute was the bank’s attempt to enforce alleged indebtedness arising from a bank overdraft/credit facility relationship against the alleged principal debtor, together with enforcement of an alleged suretyship against the second defendant. The appeal focused less on the underlying indebtedness and more on whether the summons and summary judgment papers complied with the procedural and substantive requirements for summary judgment.

2. Material Facts

The respondent pursued summary judgment on the basis that the first appellant was indebted to it in the sum of R311 102.66, together with interest at 14.81% per annum, calculated daily and compounded monthly in arrears from 25 August 2016, and costs on an attorney-and-client scale. The second appellant was pursued on the basis that he was liable as a surety.

It was common cause in the appeal record that the respondent had proceeded by way of a simple summons, and that no particulars of claim were attached to that summons. Notwithstanding the use of a simple summons, the respondent’s summary judgment affidavit purported to verify the claim “set out in the Summons and Particulars of Claim”, which became material to the appellate court’s evaluation of whether the verifying affidavit complied with the rules.

A further material feature of the papers (as relied upon by the appeal court) was that the respondent’s summons alleged that an application to open an enterprise/business account was attached as an annexure (the annexed account-opening document was dated 24 March 2003). However, a further document relied upon in the summary judgment proceedings (described as Part A of an alleged overdraft agreement, being a pre-agreement statement and quotation) bore the date 26 October 2013, was not properly linked in the summons as the contractual foundation, and did not include the vital “Part B” of the apparent overdraft agreement, which was neither attached nor properly before the Magistrate’s Court.

As to the suretyship component, the summons alleged that a suretyship agreement was entered into on 24 March 2003, but the annexed suretyship document (“annexure C”) was dated 21 May 2012. The appellate court treated this discrepancy as a significant internal inconsistency affecting the clarity and adequacy of the pleaded cause of action as presented through the simple summons and its annexures.

The appellants also raised a timing point: the respondent’s summary judgment application was filed with the clerk of the Magistrate’s Court 16 days after service of the notice of intention to defend, although it had been served on the appellants on the 15th day. The Magistrate’s Court dealt with this lateness point, but did not address the additional technical and substantive defects alleged in the summary judgment papers and in the manner of pleading.

3. Legal Issues

The central legal questions were whether the respondent’s summary judgment application and supporting papers were materially defective, and if so, whether summary judgment ought to have been refused regardless of the quality of the appellants’ opposing affidavit.

This included determining whether the respondent had complied with the requirements of Magistrates’ Court Rule 14(2)(a), which demands an affidavit that verifies the cause of action and the amount claimed and expresses an opinion that there is no bona fide defence, and whether the application could stand where the affidavit contained statements that were inconsistent with the actual pleadings (in particular, referring to “particulars of claim” where none existed).

A further issue concerned the adequacy of the simple summons to disclose a cause of action where the claim was said to be founded on written agreements. This required the court to consider the principle (drawn from authority cited) that where a cause of action depends on a written agreement, the agreement should be attached to the simple summons, failing which the summons may not disclose a cause of action.

The dispute was primarily one of law and application of law to fact, rather than credibility findings or factual determinations on the indebtedness itself. The appellate court’s task was to evaluate the procedural and pleading compliance of the summary judgment process, and the legal consequences of defects in the application and summons.

4. Court’s Reasoning

The court approached the appeal by emphasising that the starting point in summary judgment proceedings is the summary judgment application itself, including whether it meets the technical and substantive requirements of the rules. It relied on the principle that defects in the plaintiff’s summary judgment papers are not cured merely because a defendant engages with the merits in an opposing affidavit. In this regard, the judgment adopted the approach articulated in Shackleton Credit Management (Pty) Ltd v Microzone Trading 88 CC and Another 2010 (5) SA 112 (KZP), namely that if the application is defective, “cadit quaestio”, and the inquiry effectively ends at that point.

The court contrasted permissible tolerance for insignificant typographical or formal errors (as discussed in Butterlum Property Letting (Pty) Ltd v Dihlabeng Local Municipality [2016] 4 All SA 895 (FB)) with errors that are material and go to the heart of whether the cause of action and summary judgment verification have been properly established. It accepted that courts should avoid unnecessary formalism, but maintained that a plaintiff seeking summary judgment must ensure that the pleadings are technically in order and that the claim is clearly established through compliant process.

In evaluating the respondent’s reliance on Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (AD), the court held that the Magistrate’s Court’s reliance on Maharaj to treat defects as curable by reference to other documents was not justified on the facts before it. The appellate court reasoned that the respondent’s deponent had, under oath, referred to “Particulars of Claim” that did not exist because the bank proceeded by simple summons, which the court regarded as an incorrect statement of what was before court.

The court further found that the respondent’s claim, as presented, effectively relied on two separate and distinct causes of action: a claim relating to the alleged overdraft/credit facility (money lent and advanced) and a claim based on suretyship. Because the defendants in respect of those claims were not identical in legal character (principal debtor versus surety), the court considered it significant that the verifying affidavit purported broadly to verify the cause of action as if it were a single coherent set of pleadings, without properly grappling with the distinct bases of liability. The court viewed this as consistent with its prior reasoning in Butterlum that where more than one cause of action is relied upon, all must be properly verified, and non-compliance may be fatal.

On the adequacy of the simple summons itself, the court accepted as applicable the practice articulated in Absa Bank Ltd v Janse van Rensburg and Another 2013 (5) SA 173 (WCC): although a simple summons is not a pleading in the same way as a combined summons, where the plaintiff’s cause of action is founded on a written agreement, a copy of that agreement should be attached to the summons; otherwise, the summons may fail to disclose a cause of action. Applying that approach, the court held that the respondent did not properly attach or place before court the necessary contractual documentation underpinning the overdraft claim. The presence of a later-dated “Part A” quotation/pre-agreement statement, without the necessary “Part B”, and without coherent linkage to the summons as the foundation of the claim, meant the cause of action was not properly disclosed and could not be salvaged by the verifying affidavit.

In addition, the court held that the suretyship claim suffered from a serious internal inconsistency: the summons alleged a suretyship concluded on one date, yet the annexed suretyship document reflected another date. The court considered the summons, read with its annexure, to be vague and embarrassing to an extent rendering it excipiable, and it treated this as a material defect rather than a condonable technicality.

Finally, the court addressed the Magistrate’s Court’s criticism that the appellants had relied only on technical points and had not disclosed a bona fide defence. It held that this approach was incorrect in circumstances where the plaintiff’s own summary judgment application was materially defective. Even if the defendants’ opposing affidavit might have been inadequate in a case involving a proper summary judgment application, that was immaterial once the application itself was found defective in terms of the controlling principles from Shackleton.

5. Outcome and Relief

The High Court upheld the appeal and set aside the Magistrate’s Court’s order granting summary judgment.

The order of the court a quo was substituted with an order that the application for summary judgment was dismissed, that the defendants were granted leave to defend the action, and that the plaintiff (Standard Bank) was ordered to pay the costs of the opposed summary judgment application, including the defendants’ costs of opposition.

The appeal succeeded with costs, and the court expressly rejected the notion that a materially defective summary judgment application should result in the summary judgment costs merely standing over; instead, it held that the plaintiff should bear the costs of such a defective application.

Cases Cited

Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (AD)

Shackleton Credit Management (Pty) Ltd v Microzone Trading 88 CC and Another 2010 (5) SA 112 (KZP)

Standard Bank of South Africa Ltd v Roestof 2004 (2) SA 492 (W)

Butterlum Property Letting (Pty) Ltd v Dihlabeng Local Municipality [2016] 4 All SA 895 (FB)

Absa Bank Ltd v Janse van Rensburg and Another 2013 (5) SA 173 (WCC)

Legislation Cited

No legislation was cited in the judgment.

Rules of Court Cited

Magistrates’ Court Rule 14(2)(a)

Magistrates’ Court Rule 14(3)

Magistrates’ Court Rule 17(2)(b), read with Form 9 (as referred to in quoted authority)

Uniform Rule of Court 18, including Uniform Rule of Court 18(6) (as referred to in quoted authority)

Held

The court held that the respondent’s summary judgment application was materially defective because the verifying affidavit and the documents relied upon did not properly verify and support the causes of action as presented, and because the simple summons failed to disclose a cause of action where the written agreements foundational to the claims were not properly attached or coherently presented.

It further held that, once such defects are established, the court should not grant summary judgment, and deficiencies in the defendants’ answering affidavit do not cure defects in the plaintiff’s summary judgment application.

The appeal was accordingly upheld, summary judgment was dismissed, leave to defend was granted, and the plaintiff was ordered to pay the costs of the summary judgment application as well as the costs of the appeal.

LEGAL PRINCIPLES

Summary judgment procedure requires strict (though not pedantically formalistic) compliance with the applicable rules, and the plaintiff must ensure that the claim is clearly established and that the papers are technically in order. Insignificant typographical errors may be overlooked where they cause no prejudice, but defects that go to the substance of the cause of action or verification requirements are fatal.

The proper starting point in summary judgment proceedings is the summary judgment application itself. A defective summary judgment application is not rescued by the fact that a defendant deals with the merits in an opposing affidavit; absent prejudice to the defendant is not a sound basis to overlook material defects in the application.

Where a plaintiff relies on more than one cause of action, the verifying affidavit must properly verify those causes of action as required by the rules. A failure to appreciate or properly verify distinct bases of liability may render the summary judgment application defective.

Where a claim is founded on a written agreement and proceeds by simple summons, the weight of authority cited supports that the written agreement should be attached to the summons; failing this, the summons may fail to disclose a cause of action. In such circumstances, the verifying affidavit cannot cure a foundational defect in the summons and annexures.

Where a summons and its annexures contain material inconsistencies (such as irreconcilable dates for an alleged suretyship), the pleading may be vague and embarrassing and susceptible to exception, which is incompatible with granting summary judgment on an “unimpeachable” claim.

Phofung Project Consulting (Pty) Ltd v Standard Bank Of South Africa Ltd (A232/2017) [2018] ZAFSHC 21 (8 March 2018)