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[2017] ZAGPPHC 261
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ARB Electrical Wholesalers (Pty) Ltd v K and L Builders and Others (32385/16) [2017] ZAGPPHC 261 (26 April 2017)
IN
THE HIGH COURT OF SOTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE
NUMBER: 32385/16
DATE:
26/4/2017
In
the matter between:
ARB
ELECTRICAL WHOLESALERS (PTY) LTD
APPLICANT/PLAINTIFF
and
K
& L BUILDERS
CC
1
ST
RESPONDENT/DEFENDANT
GARETH
EDWARD BENSON
2
ND
RESPONDENT/DEFENDANT
BANAGANI
KLEINBOOI MAHLANGO
3
RD
RESPONDENT/ DEFENDANT
REASONS
FOR JUDGMENT
TLHAPI
J
[1]
On 18 July 2016 in an application for summary judgement against the
respondents the following order was granted:
"1.
Application for summary judgment against the 2nd and 3rd respondents
is dismissed.
2.
2
nd
and 3
rd
respondents are granted leave to
defend the action in as far as it relates to the Surety Agreement
between the 2
nd
and 3
rd
respondents and a
company by the name of Industrial Suppliers and the cession of
the agreement to the Applicant;
3.
Costs in the cause;
4.
Summary judgment is granted against the first respondent and it is
ordered it make:
4.1
Payment in the sum of R1 717 456.42;
4.2
Interest on R1 717 456.42 at the rate of 10.25 calculated from 29
April 2016;
4.3
Costs of suit between attorney and client to the taxed
The
application was opposed and the reasons relate to the first
respondent.
[2]
The applicant entered into a 'sale of business agreement' with
Industrial Cable Suppliers Proprietary Limited, whereby all rights,
title and interest in the credit facilities agreements entered
into by the latter company were transferred to applicant effective
1
March 2014. The business was sold as a going concern. The written
agreement relied upon was annexed to the particulars of claim
wherein
the relevant terms are stated as follows:
8.
"(a)
ICS would extend credit facilities to the first defendant who
purchase
electrical goods from the plaintiff;
(b)
The first defendant would pay the ICS's usual,
alternatively
a
reasonable,
price for the goods
within 30 (thirty) after the date of the plaintiff's monthly
statement reflecting
the purchase price unless otherwise agreed in writing (clause 5.1 of
annexure
‘
A’)
;
(c)
In the event of the first defendant failing to make
payment of any amount on due date, then the full amount then owing by
it (whether
then due or not) would immediately become due and payable
(clause 5.5. of annexure
‘A1’)
(d)
The first defendant would make all payment to /CS in
South Africa in South African currency and free of deduction or
set-off (clause
5.4 of annexure ‘A’)
(e)
In the event of the purchase price of any goods not
being paid on due date,
the first defendant
would be obliged to pay interest thereon at the maximum permissible
rate of interest prescribed in terms of
the National Credit Act,
as
amended from time to time, such interest to be reckoned daily and
added to the arrear amount at the end of the month, from due date
to
the date full and
final payment (clause
5.3 of annexure
‘A’);
(f)
A certificate signed by
a
director of the
ICS....reflecting the amount owing by the first defendant to ICS and
the fact that such amount is due, owing and
payable would be prima
facie proof of the facts stated for the purpose of action (whether by
way of provisional sentence or otherwise)
proof of debt
on
insolvency or
liquidation, or for any purpose where the amount of such claim is
required to be established (clause
5.6
annexure ‘A1’);
(g)
In the event of ICS instructing attorneys to recover
moneys from the first defendant, it would be liable for any costs
incurred
by the plaintiff on the scale
as
between attorneys
and client, including collection commission (clause 17
of
annexure 'A1');
13.
13.1
During the period June 2015 to August 2015, the first
defendant purchased goods from the plaintiff to the value of R1 717
456.42
and the plaintiff accordingly sold, delivered and rendered
invoices and statements reflecting such purchase for goods;
13.2
A schedule reflecting the invoice numbers and the agreed
prices in respect of the goods acquired is annexed hereto
as
annexure “C”;
14
The first defendant
failed to pay the amount claimed on the June 2015 statement, within
thirty (30) days and was accordingly liable
to pay
R1 717 456.42 on the
account, which became due and payable on or before 31 July 2015
and is liable for interest on the full
outstanding sum of
R1 717 456.42 at the rate
of 2% per month (being the maximum rate of interest allowed under the
National Credit Act from 1 August
2015 to date of final payment."
[3]
Mr A
M
A
Feinberg
who deposed to the opposing affidavit denied that the first
respondent was indebted to the applicant and he raised two
points
in
limine:
(a) That the claim is
based on a liquid document which the applicant failed to attach to
the particulars of claim or to the affidavit
in support of the
application for summary judgment. What was annexed was a 'debtor's
age analysis' and the applicant failed to
annex any
'quotes.
purchase orders. statements. invoices or at least a delivery note
evidencing how the amount allegedly in arrears was calculated'
(my
underlining)
(b) That the National
Credit Act applied to the agreement; that sections 129(1) and
130 of the National Credit Act (34)
of 2005 was not complied
with;
[4]
In defence Mr Feinburg, averred that he was the general
manager focusing on the financial management of several companies
including
the first respondent, which carried on business at 7
Rautenbach Streets and at Valley Centre, Jan Smuts Avenue
Craighall
Park. The companies were named as: lmail Corp 155 CC; T&W
Electrical Contractors Pty Ltd; Harp Act Pty Ltd; Abundant Way
Trading
Pty Ltd; High Expression Building and Construction Pty Ltd;
Marvigrath CC; Accounting and Business Consultants Pty Ltd. He
averred
that the companies are interlinked; they offer
different services and engage with the same company such as
the
applicant. The companies derive their work from tenders
which entail large projects and transactions which require strict
compliance
with time frames.
[5]
According to Mr Feinberg he was the one who 'negotiates all
agreements pertaining to these companies, approves
quotes,
purchases orders and all other documents of whatever nature
that concern the companies financially and ensures that payment is
made'. It was possible, he said, that the invoices pertaining to
this matter had crossed his desk or that he had
misfiled,
or misplaced the said invoices and that it was difficult to
identify any of the transactions from the debtors age
analysis and no
other information had been attached to assist him identifying the
transactions attached to the Particulars
of Claim.
Points
In Limine
[6]
It was submitted for the applicant that the age analysis
was not a liquid document, but a liquidated
demand.
A liquidated amount is 'either one agreed upon or which is capable of
speedy and prompt ascertainment, where ascertainment
is a mere matter
of calculation'
Tredoux v Kellerman
2010(1) SA (CPD). On
examination of the age analysis it is my view that each entry
represents a liquidated amount. The details present
reflect that it
relates to goods sold and delivered to the first respondent as
alleged in the particulars of claim, that is K &
L Builders CC.
It gives the date of issue of the invoice and gives the purchase
order number emanating from the first respondent.
There are therefore
two source documents from which the amount owing could be gleaned,
the date of the invoice, the invoice
number and the
purchase order. It is therefore incorrect to state that no invoice or
purchase order details were available
and from which the first
respondent could ascertain what the claim was about.
Furthermore, the applicant did not mention
any of the very many
companies mentioned by Mr Feinberg, the document in particular
identifies the first respondent as the
debtor and not any of
the companies occupying the premises from which the first respondent
conducts business.
[7]
In the particulars of claim at paragraph 20 mention
is made that the applicant complied
with
sections 129 of the National Credit Act and that the first
respondent had not engaged a debt counsellor. It is
also alleged that
the National Credit Act did not apply to the credit agreement by
virtue of sections 4(1)(a)(i) alternatively
sections 4(1)(b) read
with section 9(4). In the application for credit facilities the
annual turnover of the first
respondent is stated as R24 000
000. Mr Feinberg as being the person having negotiated the agreement
should be aware of such financial
status of the first respondent and
of the fact that the National Credit Act was not applicable to
the agreement. Although
in my view not being relevant, as at pages 33
and 36 of the papers is proof that section 129 was complied with.
Bona
Fide Defence
[8]
It is trite that the summary judgment procedure is not meant to
deprive a defendant who has a case to defend
from
defending such an action and, where such defence exists on good
grounds leave should be granted to defend. However where it
is clear
that no such defence exists, the plaintiff's rights to obtain payment
should not be defeated by the filing of an appearance
to defend whose
main purpose to is to delay the action.
[9]
The principles required by a defendant in order to succeed in its
opposition to an application for summary judgement were clearly
set
out in
Maharaj v Barclays National Bank Ltd
1976 (1) SA
418
(A) at 426 A-D. What is required is that the opposing affidavit
disclose a bona fide defence to the claim which entails such facts
as disputing what is contained in the particulars of claim or even
disputing what the plaintiff seeks to rely on in the source
documents. It is not for the court hearing the application for
summary judgment to determine the issues in favour of any one of
the
parties. It is sufficient if the court is satisfied that from the
defences disclosed or advanced that there was a 'reasonable
possibility that a defendant may succeed on trial.' In
Maharaj supra
the following was stated:
"The word 'fully'
.... connotes in my view that, while the defendant need not deal
exhaustively with the facts and the evidence
relied upon to
substantiate them, he must at least disclose a defence and the
material upon which it is based with sufficiently
particularity and
completeness to enable the Court to decide whether the
affidavit discloses a bona fide defence
The
respondent is expected
to
fully disclose "the nature and
grounds of his defence and the material facts upon which it is
founded and whether on the facts
so disclosed the defendant appears
to have a defence which is bona fide and good in law".
[10]
The first respondent's defence is contained in paragraphs 18 to 22 of
Mr Feinberg opposing affidavit. As general manager of
all the
different entities conducting business from 7 Rautenbach Street
Brits, he negotiated the terms of the agreement.
He approved the
purchase orders, he ensured and approved payment. It is unlikely
given his responsibilities that he would misfile
or misplace invoices
placed before him for payment in respect of a particular entity or
that he would be unable or uncertain to
effect
payment
of the invoices whose purchase orders
he specifically approved.
Misfiling
or misplacing is not the type of defence as contemplated in Maharaj
supra.
I have already stated that the age analysis document
contains sufficient particulars to assist him to identify the claims
and from
which the amounts could be easily calculated and the said
document annexed to the application gives or states the amount which
is owing. I reiterate, the first respondent is identified as the
debtor, so are the purchase orders numbers and invoice dates. The
applicant was therefore in my view entitled to summary judgment in as
far as the first respondent was concerned because
Mr Feinberg's explanation in my view did not disclose a
bona
fide
defence which was 'good in law' entitling him to leave to defend
the action.
_______________
TLHAPI
VV
(JUDGE
OF THE HIGH COURT)
DATE
HEARD
:
18 JULY 2016
DATE
DELIVERED
:
26 JULY 2017
ATTORNEYS
FOR THE DEFENDANTS
:
PENNY GRIFFITHS ATT.
ATTORNEYS
FOR THE PLAINTIFF COUNSEL
:
LOMAS-WALKER ATT.
FOR
THE PLAINTIFF COUNSEL
:
ADV. FR VAN DEN HEEVER
FOR
THE DEFENDANT
: