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[2018] ZANCHC 89
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W.M v E.B and Another (1641/2017) [2018] ZANCHC 89 (23 November 2018)
SAFLII Note: Certain personal/private details of parties or
witnesses have been redacted from this document in compliance
with
the law and
SAFLII
Policy
IN
THE HIGH COURT OF SOUTH AFRICA
(Northern
Cape Division, Kimberley)
Reportable: YES
/
NO
Circulate to Judges:
YES
/ NO
Circulate to
Magistrates:
YES /
NO
Circulate to
Regional Magistrates: YES /
NO
CASE NO:
1641/2017
DATE
HEARD:
19
NOVEMBER 2018
DATE
DELIVERED:
23
NOVEMBER 2018
In
the matter between:
W,
M
Applicant
and
B,
E
1
st
Respondent
W,
L E
2
nd
Respondent
Coram:
Olivier
ADJP
et
Williams J
et
Groenewaldt
AJ
JUDGMENT
Olivier
ADJP:
[1.]
In July
2017 the first respondent, Mr E B, issued summons against the
appellant, Mr M W, and the second respondent, Mrs L E W.
Although it appears that they may by then have separated, it is
common cause that the first respondent is the father of the second
respondent and that the appellant and the second respondent were at
that stage still husband and wife, married out of community
of
property.
[2.]
The cause
of action set out in the particulars of claim is that the first
respondent and the appellant had concluded a verbal loan
agreement
during March 2016, in terms of which the first respondent would loan
the appellant the amount of R400 000.00, payable
into the bank
account of the second respondent, and repayable within a reasonable
time, alternatively upon request. It is
alleged that the first
respondent has complied with the agreement and that, despite demand,
the appellant failed to repay the amount.
[3.]
The
particulars of claim also contain an allegation that the appellant
admitted his indebtedness in writing, and in this regard
a copy of an
e-mail that the appellant had sent to the first respondent on
17 October 2016 is annexed to the particulars of
claim as
annexure “EB1”.
[4.]
In the
particulars of claim judgment is claimed against only the appellant,
and the averment is made that the second defendant is
only cited
“
insofar
as she may have an interest in the matter
”
.
[5.]
Annexure
“EB1” consists of five paragraphs. The first three
paragraphs deal with money which the appellant indeed
owed to the
first respondent in unrelated matters. The fourth paragraph is
the one that was referred to in the particulars
of claim as an
“
acknowledgement
of … indebtedness
”
.
It reads as follows:
“
Wat
die R400k betref vir die huis werk ek nog aan ‘n plan en hou Pa
op hoogte. Ek glo nie Standard Bank gaan vir my
nog geld leen
indien ons net 1 inkomste het tussen my en Lize. Kan ek vir Pa
‘n plan gee teen einde Desember, die geld
kan rente ook
oploop?
”
[6.]
The
appellant entered appearance to defend the action and the first
respondent then applied for summary judgment, which the appellant
opposed.
[7.]
In his
opposing affidavit the appellant in essence denied that he had
concluded a loan agreement with the first respondent and that
annexure “EB1” constituted, or was intended as, an
acknowledgement of indebtedness.
[8.]
As
regards the alleged loan agreement the appellant stated that,
although he had indeed approached the first respondent with a view
to
a loan of approximately R600 000.00 to assist him and the second
respondent in the construction of a house, he and the
first
respondent never actually concluded a loan agreement. He stated
that he had in fact, after not having received “
positive
feedback
”
from
the first respondent, approached his brother for a loan.
[9.]
As
regards annexure “EB1” the appellant stated that he had
only during October 2016 become aware of the fact that the
first
respondent had paid the amount of R400 000.00 into the bank
account of the second respondent, and that the negotiations
regarding
the repayment of that amount had been conducted between the two
respondents, and without his knowledge.
[10.]
The
appellant stated that he realised that the amount would have to be
repaid to the first respondent and that he then sent the
e-mail
(annexure “EB1”) to the first respondent “
in
an attempt to make arrangements for the repayment
”
.
He explained that he did so because the second respondent was
bipolar, addicted to pain medication and “
in
general incapable of managing money properly
”
.
[11.]
The
court
a
quo
,
in granting summary judgment and making a costs order against the
appellant, found that the relevant paragraph of the e-mail indeed
amounted to an acknowledgement of indebtedness. The appellant’s
explanation was rejected on the following grounds:
11.1
The e-mail contained no reference of the appellant having only in
October 2016 become aware
of the amount of R400 000.00 that had
been paid into the bank account of the second respondent.
11.2
The e-mail contained no mention of the appellant having been unaware
of the terms and conditions
pertaining to the repayment of that
amount. It appears that the court
a quo
found that the
fact that the appellant had tendered to have a repayment plan
ready by December 2016, and had tendered to
pay interest, indicated
that he must have been aware thereof.
11.3
No mention was made, in the e-mail, and in making this tender, of the
second respondent.
[12.]
The court
a quo
concluded, on this
basis, that the appellant had not disclosed a defence in his opposing
affidavit.
[13.]
This is
an appeal, with the leave of the court
a
quo
,
against the granting of summary judgment and the costs order.
In his heads of argument Mr Olivier, counsel for the appellant,
submitted that there should have been doubt in the mind of the court
a quo
about whether the
e-mail “
constitute(d)
and unequivocal admission of liability
”
on
the part of the appellant. He also submitted that the court
a
quo
had,
in rejecting the appellant’s explanation on the basis of the
fact that the e-mail did not refer to certain issues, “
set
the bar too high
”
as
regards what was expected from a defendant’s opposing affidavit
in summary judgment proceedings.
[14.]
Mr Van
Niekerk SC, counsel for the first respondent, pointed out the
following aspects of the e-mail in support of his submission
that it
indeed amounted to an acknowledgement of indebtedness:
14.1
Just like in the case of the first three paragraphs of the e-mail,
the particular paragraph
also concerned the repayment, by the
appellant, of a loan.
14.2
According to the e-mail it was the appellant, and not the second
respondent, who was working
on a plan to repay the R400 000.00
to the first respondent.
14.3
The appellant, in the particular paragraph, made reference to his
personal inability to
obtain a loan from the bank.
[15.]
Mr Van
Niekerk criticised the opposing affidavit, with reference to the case
of
Breitenbach
v Fiat SA (Edms) Bpk
[1]
,
as being “
needlessly
bald, vague (and) sketchy
”
[2]
.
In this regard he made the following submissions:
15.1
Although the appellant pointed out that he and the second respondent
were involved in protracted
divorce proceedings, the opposing
affidavit was silent on when the divorce proceedings were instituted
and, more particularly,
on whether it had been before or after the
date of the e-mail.
15.2
The appellant’s positive statement that the respondents had
negotiated the terms
pertaining to the repayment of the R400 000.00
themselves was irreconcilable with his statement that this had
occurred without
his knowledge.
15.3
The appellant failed to explain what the particular paragraph in the
e-mail was intended
to be, if not an acknowledgement of indebtedness.
[16.]
In the
absence of an express statement in the e-mail by the appellant that
he had loaned the money that was eventually paid into
the second
respondent’s bank account, it must follow that the court
a
quo
had,
in its observations and conclusions regarding the contents of the
e-mail, embarked on an exercise of interpreting its contents.
In
Millman
NO v Klein
[3]
the following was remarked
[4]
regarding the interpretation of documents when it comes to summary
judgment proceedings:
"
In
regard to the misconstruction of the proposed scheme of arrangement,
it is of course undesirable that a Judge should embark upon
niceties
of the interpretation or construction of an agreement or offer or
document in summary judgment proceedings where he does
not have the
terms to be interpreted or construed in the context of the
surrounding facts of the case as they existed at the time
that the
agreement or offer or document came into existence, as he would have
after hearing the evidence at a trial. The risk of
misunderstanding
the intention of persons when looking at their words in vacuo, and
not in the setting at the time they were used,
needs no emphasis.
Where, however, a contention is advanced in summary judgment
proceedings which may be refuted by pointing to
a palpable misreading
of a document and a palpable logical fallacy, and the meaning of the
document is clear on the point in debate,
whatever the surrounding
circumstances may have been, the risk of errors of interpretation of
the words used may be so reduced
as to be negligible, and the point
in issue may be capable of summary decision.
"
[17.]
In this
case not all of the “
surrounding
facts
”
that
would have been required to interpret the particular paragraph in the
e-mail in proper context were before the court
a
quo
,
and the
available information raised certain questions:
17.1
What could the reason have been for a term in a loan agreement
between the first respondent
and the appellant that the money, that
was to be advanced to the appellant, was to be paid into a bank
account of the second respondent?
There may have been a
perfectly good explanation for such a term in the alleged loan
agreement, but it is not discernible from
the particulars of claim.
On the other hand, the fact that the payment was made into the
account of the second respondent,
fits in perfectly with the
explanation of the appellant.
17.2
When exactly was the payment made into the account of the second
respondent? The
date is not alleged in the particulars of
claim. Can it really then, in these circumstances, be said that
it is improbable
that the appellant only became aware of the payment
in October 2016? Would the fact that the e-mail was sent during
that
same month not in fact fit in with the appellant’s
explanation?
17.3
Were the appellant and the second respondent still together as
husband and wife at the
time when he wrote the e-mail? The
reference in the e-mail to only one income between the two of them
would suggest that
this may have been the case. The reference
in Mr Van Niekerk’s heads of argument to the absence of
information about
when the divorce proceedings were instituted,
effectively recognises the relevance of the status of the
relationship between the
appellant and the second respondent at the
time of the e-mail when it comes to considering the probability of
him having requested
this father-in-law for time to make arrangements
for the repayment of an amount which had been paid into the account
of his wife
(and the daughter of the first respondent). This is
the kind of information that would form part of the “
surrounding
facts
”
referred
to in the
Millman
case, and in the context of which the contents of the e-mail, and of
the particular paragraph, should be read.
17.4
If the appellant and the second respondent were still together as
husband and wife at the
time of the email, would it really have been
so strange that a husband would have attempted to come to an
arrangement with his
father-in-law about when money which had been
paid into his wife’s account would be repaid; particularly in
view of his wife’s
mental condition? If there was only
one income between the appellant and the second respondent, the money
for the repayment
of the amount would in any event in effect have had
to come from the funds of the appellant. Against this
background it would
arguably also not be strange that the appellant
would have referred to only his own ability to obtain a loan from the
bank
17.5
The fact that, as also appears from the e-mail, the money had gone
into the construction
of the common home of the appellant and the
second respondent, would also be a relevant factor in considering the
probability of
the appellant being prepared to negotiate the
repayment of money that had actually been advanced to his wife, but
had gone into
their common home. It would in my view, against
this background and given the drastic nature of the summary judgment
remedy,
have been unrealistic, and dangerous, to reason that the
appellant would have had no reason to concern himself about the
repayment
of money that had been advanced to his wife to whom he was
married out of community of property.
[18.]
As
regards Mr Van Niekerk’s submission that the appellant did not
explain what his intention was with the particular paragraph
in the
e-mail, if not intended as an acknowledgement of debt, it is in my
view clear from the opposing affidavit that the appellant’s
version is that his intention was to negotiate an extension of time
for the repayment of the amount. In fact, this is what
the
appellant in so many words said in his opposing affidavit, when he
stated that he had “
addressed
Annexure ‘EB1’ to (the first respondent) in an attempt to
make arrangements for … repayment
”
.
[19.]
If Mr Van
Niekerk’s submission (in his heads of argument) is correct that
the alleged “
acknowledgement
of indebtedness
”
in the e-mail is not part of the first respondent’s cause of
action, the reference to it in the particulars of claim
would
arguably have amounted to the pleading of evidence, and the
correctness of the averment that it constituted an acknowledgement
of
indebtedness would arguably not have been verified in the first
respondent’s supporting affidavit. It is not necessary
to
consider this, because even if it could be said to have been pleaded
as a distinct cause of action, the contents of the email
cannot in my
view be said to be clear, “
whatever
the surrounding circumstances may have been”,
on
the issue of whether the money had been paid into the second
respondent’s account as a result of a loan agreement which
had
been concluded between the appellant and the first respondent.
[20.]
The
statement in the opposing affidavit that the second respondent
negotiated the terms regarding the R400 000.00 with the
first
respondent, and the statement that those negotiations had taken place
without the knowledge of the appellant, are not in
my view, as
suggested by Mr Van Niekerk, necessarily irreconcilable. The
second respondent, or even the first respondent
himself, could have
told the appellant what had been agreed as far as repayment was
concerned. In my view it could be said
that the appellant had
in his affidavit simply tried to convey that he had, at the time that
the amount was paid into the bank
account of the second respondent,
not been aware of such negotiations.
[21.]
In any
event, an opposing affidavit is not supposed to be subjected to this
kind of scrutiny. A defendant in summary judgment
proceedings
“
is
not expected to formulate his opposition to the claim with the
precision that would be required of a plea; nor does the Court
examine it by the standards of pleading
”
,
and the question whether a
bona
fide
defence
has been disclosed is not dependant on a finding, by a court in
summary judgment proceedings, that the balance of probabilities
favours the version in the opposing affidavit
[5]
.
[22.]
In my
view the opposing affidavit did indeed disclose a
bona
fide
defence
to the cause of action of a loan agreement,
viz
that the appellant had
never concluded the alleged loan agreement, and the contents of “EB1’
cannot necessarily be said
to be irreconcilable with that defence,
more particularly not in circumstances where not all surrounding
facts are at this stage
known.
[23.]
If regard
is had to the different addresses of the appellant and the second
respondent at the time of the issue of summons, which
would confirm
that the appellant and the second respondent had in the meantime
separated (as also indicated in the opposing affidavit),
the fact
that the first respondent chose not to claim payment from his
daughter a
nd
the curious and as yet unexplained fact that, even on first
respondent's version, the R 400 000 had not been paid into the bank
account of the person who had according to first respondent loaned
the money, this would in my view in any event have been an
appropriate case to refuse summary judgment, even if the app's
opposing affidavit might not have disclosed a defence
[6]
.
[24.]
It
follows that I am of the view that the application for summary
judgment should have been dismissed.
[25.]
As far as
the costs of the application for summary judgment are concerned, I am
of the view that the just costs order would in such
circumstances
have been that they be costs in the action, so that in the end such
costs would in effect follow the finding that
is eventually made as
regards the alleged loan agreement and the contents of the e-mail.
[26.]
There is
no reason why the costs of the appeal should not follow its result.
[27.]
In the
premises the following orders are made:
1.
THE
APPEAL SUCCEEDS AND THE ORDERS OF 2 FEBRUARY 2018, GRANTING
SUMMARY JUDGMENT AND COSTS AGAINST THE APPELLANT, ARE SET ASIDE
AND
SUBSTITUTED WITH THE FOLLOWING ORDERS:
“
1.
THE APPLICATION FOR SUMMARY JUDGMENT IS DISMISSED.
2.
THE
FIRST DEFENDANT IS GRANTED LEAVE TO DEFEND THE ACTION.
3.
FURTHER
PLEADINGS AND NOTICES ARE TO BE FILED AS IF NOTICE OF INTENTION TO
DEFEND WAS GIVEN ON 23 NOVEMBER 2018.
4.
THE
COSTS OF THE APPLICATION FOR SUMMARY JUDGMENT SHALL BE COSTS IN THE
ACTION.”
2.
THE FIRST RESPONDENT IS ORDERED TO PAY THE COSTS OF THE APPEAL.
C
J OLIVIER
ACTING
DEPUTY JUDGE PRESIDENT
NORTHERN
CAPE DIVISION
I
concur.
C
C WILLIAMS
JUDGE
NORTHERN
CAPE DIVISION
I
concur.
S
J GROENEWALDT
ACTING
JUDGE
NORTHERN
CAPE DIVISION
For the
appellant:
ADV. A D OLIVIER
(oio
Wessels
& Smith Inc.
c/o
Duncan
& Rothman Inc.
)
For the 1
st
respondent:
ADV. J G VAN NIEKERK SC
(oio
Engelsman
Magabane Inc.
)
[1]
1976 (2) SA 226 (T)
[2]
Ibid
, at 228E
[3]
1986 (1) SA 465
(C) (Also reported at
[1986] 1 All SA 229
(c))
[4]
Ibid
at 480F
–I
[5]
Maharaj v Barclays National Bank Ltd
1976 (1) SA 419
(A)
(Also reported at
[1976] 2 All SA 121
(A)) at 426A - F
[6]
Compare
Gilinsky and Another v Superb Launderers and Dry Cleaners
(Pty) Ltd
1978 (3) SA 807
(C) at 810H