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[2017] ZAGPPHC 407
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Tibane Masjianoke Trading v Ras and Another (81006/2015) [2017] ZAGPPHC 407 (24 February 2017)
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REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG,
PRETORIA
DATE:
24/2/17
CASE
NO: 81006/2015
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
In
the matter between:
TIBANE
MASHIANOKE
TRADING APPLICANT
and
ANTON
RAS
1
ST
RESPONDENT
JUDITH
RAS 2
ND
RESPONDENT
Delivered
24 February 2017
JUDGMENT
Molahlehi
J
Introduction
[1]
This is an application to rescind the default judgment made by Louw J
dated 18 February 2016. The application is brought in
terms of rule
31(2)(b) of the Uniform Rules of the Court (the Rules).
[2]
The claim of the respondents that resulted in the default judgment
which is the subject of this rescission application is based
on two
oral agreements concluded with the applicant. Both oral agreements
were according to the respondents concluded during 2014.
The oral
agreements were also reduced to writing.
[3]
The respondents further state that during the same period, July 2014,
a mortgage bond was registered over the applicant's property
being
portion 61
ERF
[....] N. E. of the Township, in the Province
of Limpopo in their favour. The applicant was according to the
respondent obliged
to make certain payments arising from the
agreement including the amount of R800 000, which was to be paid
within four months calculated
from the date that the amount of the
loan was paid to it. The same applied to the second agreement which
involved the payment of
R40 000 00.
Background
Facts
[4]
It is common course that the respondents instituted an action against
the applicant on the 7 October 2015 for the payment of
the amount of
R840 000. The claim was instituted on the basis that the applicant
had failed to comply with the terms of the loan
agreement.
[5]
The case of the applicant is that the reason for not entering an
appearance to oppose the claim was because the summonses were
never
served on it.
[6]
The first service of the summons by the Sheriff was affected at
[....] G. V. S., Polokwane. The sheriff then served at [....]
E. D.,
Koro Creek Nylstroom where the service was effected by way of fixing
the summons to the gate as there were no other methods
of service
possible according to the respondents
[7]
The applicant disputed that service could be effected in the manner
stated by the Sheriff because the property on which the
service is
alleged to have been effected does
not
have a gate. The property according to the applicant is in a Golf
Estate where there are no walls or fnces for the house therein.
This
includes number [....] E. D. Koro Creek. According to the applicant,
the only gate for the property is the main gate of the
entrance of
the estate.
[8]
The deponent to the founding affidavit states that the applicants
became aware of the claim when the Sheriff served the warrant
of
execution on the same property
[9]
As concerning
bona
fide
defence the
applicant disputes the agreements which the respondent relied on in
obtaining the default judgment. It is further contended
that there is
no prove that the applicant received the amount of R500 000 00 as
alleged by the respondent.
Evaluation
[10]
The
applicant's
application
is
based
on
the
provisions
of
rule
31
(2)
(b)
of
the
Rules.
It follows
therefore
that
in
order
to
succeed
the
applicant
has
to
show
good
cause. The
requirements of
good
cause
for
the
purpose
of
a
rescission
application are
set
out
in
Grant
v
Plumbers
(Pty)
Ltd,
[1]
and can be
summarised
as follows:
(a)
The applicant must give a reasonable explanation for his/her default.
(b)
The court should refuse to grant the rescission if the default was
willful or due to gross negligence.
(c)
The application must be bona fide and not be made for the purpose of
delaying the plaintiffs claim.
(c)
The applicant must show that he/she has a bona fide defence to the
plaintiffs claim.
[11]
It
is
trite
that
in
considering
whether
to
grant
or
refuse
an
application
for
rescission
of an order
or judgment, the court has a wide discretion to exercise. In
exercising
its
discretion
the
court
is
enjoined
to
make
sure
that
justice
is
done
to
both
parties. In
this
respect, the Court in considering good cause in an application for
rescission of a judgment need to balance that with the
provisions
of s34 of the Constitution. In this respect it was stated in
RGS
Properties (Pty) Ltd v Ethekwini Municipality,
[2]
that a
default
judgment:
"...
is inherently contrary to the provisions of s34 of the Constitution.
The section provides that everyone has a right to
have any dispute
that can be resolved by 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 being granted in the first
instance. In its deliberation
the court will no doubt be mindful,
especially when assessing the requirement of reasonable cause being
shown, that while among
others this requirement incorporates showing
the existence of a bona fide defence, the court is not seized with
the duty to evaluate
the merits of such defence. The fact that the
court may be in doubt about the prospects of the defence to be
advanced, is not a
good reason why the application should not be
granted. That said however, the nature advanced must not be such that
it prima facie
amounts to nothing more than a delaying tactic on the
part of the applicant."
[12]
The
requirements of good cause does not, as a matter of principle,
require the applicant to show that the balance of probabilities
will
favour him or her once rescission is granted or when the main case is
considered. All that the applicant needs to
show
is
that
he
or
she has a
defence
which has
prima
facie
prospects
of success and
that
the
application
is
not
a
mere
delaying
stratagem.
The
reason
for this
low
standard
is
to
avert an
injustice
occurring in
the
context
where
the
default
judgment may have unjustifiably denied the respondent access to the
court. As stated
in
Harris v
ABSA
Bank
Ltd
t/a
Volkskas:
[3]
"Even in the face of
wilful default, in my view, the Court is enjoined to examine whether
the defence raised by the person
who seeks the relief shows the
existence of an issue which is fit for trial."
[13]
The applicant's case is that it was not in wilful default in not
entering notice of opposition to the respondents' claim. It
further
contends that it has a
bona fide
defence which entitles it to
the grant of the rescission application. In this respect it denies
ever entering into an oral agreement
with the defendants, and further
that the amount which is the subject of the claim was not paid into
its account.
[14]
The other point raised by the respondent is that the amount was
transferred before the expiry of the 5 day period as provided
for in
the agreement.
[15]
In my view the applicant's case is unsustainable when regard is had
to the objective facts. Firstly, in relation to the service
of the
summons commencing the proceedings, the respondent states in their
answering affidavit that all attempts were made to ensure
proper
service was effected on the applicant. The service was thereafter
served at the chosen
domi
cilium
as
indicated in the "Memorandum of Agreement" and the
registered mortgage bond.
[16]
In terms of section 43 (2) the Superior Court Act 10 of 2013 the
Sheriffs return of service is
prima
facie
evidence of what is stated therein. The return of service of the
Sheriff in the present matter indicates that the summons, were served
at the chosen
domi
cilium
and in addition
the Deputy Sheriff attested to the affidavit which is attached to the
answering affidavit of the respondents concerning
his efforts at
serving the summons on the applicant. He states in the affidavit that
he attempted to serve the applicant on two
occasions to no avail. On
the second occasion he was informed by the person at the premises
that the applicant had moved to an
unknown address.
[17]
T
he case of the
applicant would still remain unsustainable even if its version
regarding the service of the summons on it was to
be accepted. The
case would be unsustainable because the applicant has failed to make
out a case for a
bona
fide
defence. There are
also no prospects of success in as far the alleged defence is
concerned. In this respect the applicant denies
the existence of the
oral loan agreement and ever meeting with the respondents on the
dates on which the respondents contended
that the agreement was
concluded. It further denies that the oral agreement of the 28 March
2014 was reduced to writing during
May 2014. The deponent to the
founding affidavit in support of the rescission application states
that the signature on the Memorandum
of Agreement looks similar to
his but that he never signed the document in question. He does not,
however, say under what circumstances
his signature came to appear on
the document in question.
[18]
It is trite that in order to have a mortgage bond registered with the
deeds office, the mortgagor has to sign the powers of
attorneys for
an agent that shall be responsible to pass the mortgage bond in
favour of the mortgagee, in this instance it was
the respondents.
This means that the mortgage bond cannot be passed over a property in
favour of the mortgagee unless the powers
of attorney has been
executed by the mortgagor directing that the property be registered
in favour of the mortgagee.
[19]
In the present instance the denial of the existence of the agreement
does not assist the applicant because it does not explain
how in the
absence of the agreement it passed the mortgage bond in favour of the
respondents in the amount of R1.2 million as security
for the loan
that the respondents had advanced to it.
[20]
It is important to note that the mortgage bond confirms the oral
agreement which as stated above the applicant denies. The
applicant
makes no reference to the mortgage bond in its papers neither does it
deny its existence which means the most reasonable
inference to draw
is that the mortgage bond was registered in favour of the respondents
as security to the loan which they had
made to the applicant. This is
further supported by the fact that the deponent to the founding
affidavit is the sole director and
also that he does not deny the
signature on the document in question but simply say that the
signature looks like his.
[21]
In light of the above, I am of the opinion that the applicant has
failed to make out a case for the rescission of the default
judgment.
Accordingly the rescission application stands to fail. I see no
reason why costs should not follow the results.
Order
[22]
The applicant's application to rescind the default judgment made on
18 February 2016 is dismissed with costs.
_______________
E.M
MOLAHLEHI
JUDGE
OF THE HIGH
COURT;
PRETORIA
Appearances:
For
the Applicant: A M Malesa Attorneys
For
the Respondent: Steyn Kinnear Inc
[1]
1949
(2) SA 470 (O).
[2]
2010 (6) SA 572 (KZD).
[3]
2006
(4) SA 527
(T).