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[2017] ZAGPPHC 263
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Nimenge Beleggings (Pty) Ltd v Everdure Services and Technologies CC (81098/14) [2017] ZAGPPHC 263 (31 March 2017)
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE
NO: 81098/14
DATE:
31/3/2017
In
the matter between:
NIMENG
BELEGGINGS (PTY)
LTD
APPLICANT
and
EVERDURE
SERVICES AND TECHNOLOGIES CC
RESPONDENT
JUDGMENT
COLLIS
AJ:
INTRODUCTION
[1]
In the present application, the Applicant seeks an order for
the rescission of a default judgment taken against it on 31 March
2015.
It is apposite to mention that the said judgment was granted by
the Registrar. The application is brought in terms of Uniform
31(2)(b),
alternatively,
Rule
42. The Respondent has opposed the relief sought.
BACKGROUND
[2]
The
facts are briefly that, during or about November 2011 and at or near
Midrand, the Applicant and the Respondent concluded an
oral agreement
in terms whereof the Respondent would render bookkeeping, accounting,
auditing and related services to the Applica
nt.
[1]
[3]
During the time period from November 2011 to June 2012 the
Respondent did complete several bookkeeping, accounting, auditing and
related services for the Applicant and other legal entities
including:
"3.1.1 The
Philadelphia Trust, of which the Applicant is a trustee;
3.1.2
The Olympia Trust, of which the Applicant is a trustee;
3.1.3
The Etienne Ernst Trust, of which the Applicant is a trustee;
3.1.4
N.A.S.M.E of which the Applicant is the sole director;
3.1.5
M. T. I Manpower Consulting Services (Pty) Ltd of which the Applicant
is the sole director; and
3.1.6
In respect
of the Applicant's director in his personal
capacity."
[2]
[4]
Pursuant
to the rendering of the services mentioned above, the Respondent had
furnished the Applicant with various invoices against
which the
Applicant made several payments to the
Respondent.
[3]
UNIFORM
31(2)(b)
[5]
Rule 31(2)(b) provides as follows:
"A defendant may
within twenty (20) days after he or she has knowledge of such
judgment apply to court upon notice to the Plaintiff
set aside such
judgment and the court may, upon good cause shown, set aside the
default judgment on such terms as to it seems meet."
[6]
An Applicant in order to, meet the requirements for the
rescission of judgment under Rule 31(2) (b) must show the following:
(a) He (the
Applicant) must give a reasonable explanation of its default. If it
appears that the Applicant's default was wilful
or that it was due to
gross negligence the Court should not come to his assistance;
(b) His
application must be bona fide and not merely with the intention to
delay the Plaintiff's claim;
(c)
He must
show that he has a bona fide defence to the Plaintiff's claim. It is
sufficient if he makes out a prima facie defence in
the sense of
setting out averments which, if established at trial,
would entitle him to the relief sought
[4]
.
He need to deal fully with the merits of the case and produce
evidence that the possibilities are actually in his favour.
[7]
A court must therefore in this application for recession
decide whether sufficient cause has been shown to rescind the
judgment.
In Chetty vs Law Society of Transvaal
1985 (2) SA 756
(A)
the requirements of this concept were considered by Muller JA as
follows at 756A- C:
"The term
sufficient cause
(or good cause) defies
peace for many and various factors required to be considered.
But it is clear that in principle in
the long standing practice of
our Courts two essential elements of sufficient cause
for
rescission of judgment by default are:
(i)
that the party seeking relief must present a reasonable and
acceptable explanation
for
his default;
and
(ii)
that on the merits such party has a bona fide defence which
prima facie, carries
some
prospect of
success."
[8]
I will proceed to deal succinctly with the above requirements.
CONDONATION
[9]
As mentioned in paragraph 5 above, an application to Rule
31(2)(b) should be brought within the 20 days of the Applicant's
knowledge
of the judgment.
[10]
Insofar as the Applicant's knowledge is concerned, the Applicant sets
out that it first obtained the knowledge of the judgment
being taken
against it during May 2015. Subsequent thereto the parties entered
into discussions with each other. After the discussions
had failed to
bear any fruit, a decision was then taken to institute the present
application for the rescission of judgment. According
to the
Applicant the rescission application was instituted as soon as was
practically
possible.
[5]
[11]
The
Applicant contends that part of the delay was brought about by the
erroneous case number reflected on the warrant of execution.
In
support of the explanation for the delay the Applicant annexed
a confirmatory affidavit deposed by its instructing attorney
[6]
.
[12]
In response the Respondent contends that the Applicant first
approached its instructing attorney with regards to possible
settlement
of the matter during October 2015, which was six (6)
months after first obtaining knowledge of the judgment. When
settlement negotiations
proved fruitless, the Applicant waited for
a further period of five
(5) months
before instituting the
rescission
application.
[7]
[13]
Counsel appearing for the Respondent argued that the
explanation proffered by the deponent to the Founding Affidavit as
regards
the reasons for the delay was sketchy bold and vague and as
such not sufficient to enable a court to come to the assistance of
the Applicant.
[14]
The Applicant having been represented by attorneys when judgment
was granted has failed to explain why its attorneys
were unable to
launch the rescission application timeously. It would have been a
simple exercise for its attorneys to ascertain
the correct case
number as between that reflected in the court order and that on
the warrant of execution. In such an event
the Applicant would have
been able to launch the rescission application within the time limit
permitted by the Rules.
[15]
The deponent to the Founding Affidavit makes no reference to the
dates when the settlement negotiations, after first obtaining
knowledge of the judgment, ensued, nor is any reference made to the
dates when such negotiations failed. In fact
it is
the Respondent who made reference to such dates in its Answering
Affidavit whereas it was incumbent upon the Applicant to
refer this
Court to such dates.
[16]
An Applicant seeking an extension of a time limit has to
satisfy the court on good cause shown that an indulgence ought to be
given.
[17]
Given the totality of what has been expanded in the Founding
Affidavit the Court is not convinced that the delay has been
satisfactorily
explained.
See Silber vs Ozen Wholesalers (Pty) Ltd
1954 (2) SA 345A at
353A.
[18]
The
explanation on the delay is however not the only requirement to
satisfy the court on "good cause shown". In addition
thereto, an Applicant must also satisfy the court that he has a bona
fide defence
[8]
.I will return
to this requirement later in the
judgment.
ABSENCE
OF WILFULNESS
[19]
The
wilful or negligent nature of the defendant's default is another
consideration which the court takes into account in the exercise
of
its discretion to determine whether or not good cause is shown.
[9]
It then follows that the reason for the Applicant's absence or
default must therefore be set out as this is relevant to the question
whether or not his or her default was wilful. In Silber v Ozen
Wholesalers (Pty) Lt
d
1
[10]
it
was held that the explanation for the default must be sufficiently
full to enable the court to understand how it
came about and to
assess the Applicant's conduct and motives.
[20]
Before a person can therefore be said to be in wilful default
the following elements must be shown:
(a) knowledge
that the action is being brought against him or her;
(b) a
deliberate refraining from entering an appearance, though free to do
so; and
(c) a
certain mental attitude towards the consequence of the default.
[21]
In this regard the Applicant sets out, in par 8.2 to the
Founding Affidavit that:
21.1
"The summons was served upon the erstwhile auditors of the
Applicant whose address was still
listed within CIPRO. They however
never sent the relevant documentation through to myself.
21.2
Furthermore I was later informed that the summons was also e-mailed
to me. I however never
received such email."
[22]
The Respondent as per paragraph 8 - 8.2.2 denies that the
Applicant at the time was not aware that summons was served on its
erstwhile
auditors, and in this regard referred the court to various
emails wherein the Applicant's erstwhile auditors informed the
Applicant
of the service of the summons and even furnished the
Applicant electronically by registered post with a copy of the
summons.
[23]
The Respondent therefore contends that it is disingenuous for the
Applicant to aver that it only became aware of the proceedings,
when
the warrant of execution was executed on it.
[24]
The Replying Affidavit is silent as to whether at the time of
service of the summons the Applicant received a copy thereof either
electronically or as per the registered post from its erstwhile
auditors.
[25]
As a consequence I cannot, but conclude that indeed the
Applicant had knowledge of the impending action and deliberately
refrained
from entering an appearance to defend, thereby displaying a
certain mental attitude towards the consequence of default.
[26]
I therefore find the Applicant's default was wilful.
BONA
FIDE DEFENCE
[27]
In essence the defence raised by the Applicant appears in
paragraph 7.4 to its Founding Affidavit. Therein the Applicant
essentially
alleges that it cannot be held liable for services
rendered to wholly unconnected legal entities, despite the fact that
those legal
entities might have been represented by the same
businessman.
[28]
Furthermore, the Applicant alleges that of the invoices upon
which the Respondent's main action was based, only four invoices
related
to services rendered to the Applicant amounting to a total of
R270 981.00. As such, the Applicant further contends that the full
amount could and should never have been granted against the
Applicant.
[29]
The
Respondent in opposition to the defence sets out
[11]
that upon receipt of specific instructions Mr Ettiene Adalbert Ernst,
all invoices on which the Respondent's action is based were
made out
to Nimeng Beleggings (Pty)
Ltd.
The
reason for the aforesaid was stated as being that this was done in
order for the Applicant to claim VAT on all the issued invoices
because it was the only VAT vendor of all the entities.
[30]
This
specific instruction was denied by the Applicant in its Replying
Affidavi
t.
[12]
[31]
Ex Facie the affidavits before the Court a factual dispute
exists between the parties as to whether there was some agreement
reached
between the parties as to the fact that the Applicant will be
liable for the debt of other legal entities.
[32]
This to my mind constitutes a
bona fide
defence which
can only be ventilated at trial.
[33]
As a bona fide defence has been disclosed, this court is
inclined to grant the Applicant its condonation request as the second
requirement
for condonation
i.e.
that of a bona fide defence has been met.
[34]
Where an Applicant, such as in the present matter, fails to
convince a court of a lack of wilful conduct on his part, but indeed
disclose a bona fide defence, a court must come to his assistance.
ORDER
[35]
In the result the following order is made:
35.1
The Applicant is granted condonation for the late launching of the
rescission application.
35.2
The default judgment order and warrant issued pursuant thereto, are
to be rectified to reflect
case number 81098/14 instead of 87098/14.
35.3
The judgment granted against the Applicant under case number 81098/14
is hereby rescinded.
35.4
Each party to pay its own costs.
___________________
C.
J. COLLIS
ACTING
JUDGE GAUTENG DIVISION PRETORIA
APPEARANCES:
FOR
APPLICANT:
ADV. C. L MAKRAM
INSTRUCTED
BY:
GENIV
WULZ ATTORNEYS
FOR
RESPONDENT:
ADV. J. A VAN TONDER
INSTRUCTED
BY:
HECKROODT
ATTORNEYS
DATE
OF HEARING:
14 MARCH 2017
DATE
OF JUDGMENT:
31 MARCH 2017
[1]
Founding
Affidavit
par
7
.1
page
10
[2]
Founding Affidavit par 7.3 page 10
[3]
Founding Affidavit par 7.4 page 11
[4]
Grant v Plumbers (Pty) Ltd 1949 (2) SA 470
(O)
[5]
Founding Affidavit par 9.4 page 13
[6]
Founding Affidavit par 9.3 page 13
[7]
Answering Affidavit par 9.2 page 51
[8]
Dalhouzie v Bruwer
1970 (4) SA 566
(C) at 57
F
[9]
Harris v Absa Bank Ltd t/a Volkskas
2006 (4) SA 527
(T) at
530B - 531B
[10]
1954 (2) SA 345
at 353A
[11]
Answering Affidavit para 7.3- 7.3.6 page 46
[12]
Replying Affidavit para 3 pages 74 - 76