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[2017] ZAGPPHC 819
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Tibane Mashianoke Trading v Ras and Another (81006/2015) [2017] ZAGPPHC 819 (24 February 2017)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG,
PRETORIA
CASE NO: 81006/2015
Date:
24/02/2017
Not
reportable
Not
of interest to other judges
Revised
In
the matter between:
TIBANE MASHIANOKE
TRADING
APPLICANT
and
ANTON
RA
S
1
st
R
ESPONDENT
JUDITH
RA
S
2
nd
RES
PONDENT
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 [...] ERF [...] Nylstroom Estate 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 [...]
Street, Polokwane. The sheriff then served at [...], 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 fences for the house therein. This includes number [...]
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
Sheriff s 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.
The 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.
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).