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[2016] ZAGPPHC 43
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Mushwana and Another v Bondev Midrand (Pty) Ltd and Others (1415/14) [2016] ZAGPPHC 43 (3 February 2016)
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IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE
NUMBER:1415/14
DATE:
3 February 2016
RODRIEK
NKHENSANI MUSHWANA
First
Applicant
CHRYSELDA
TLANGELANI MUSHWANA
Second
Applicant
V
BONDEV
MIDRAND (PTY) LIMITED
First
Respondent
THE
REGISTRAR OF DEEDS, PRETORIA
Second
Respondent
NEDBANK
LIMITED
Third
Respondent
JUDGMENT
MABUSE
J
:
[1]
This is an application for a rescission of a judgment that was
obtained by default against the applicants on the 14
th
of
May 2014. As the said order was obtained in the absence of the
applicant it is therefore a default judgment and subject
to be set
aside in terms of Rule 31(2)(B) of the Uniform Rules of Court.
[2]
On 17 June 2014 the first and second respondents in the main
applicant, the applicants in this application for rescission, brought
an urgent application consisting of two parts, namely Parts and B. In
view of the fact that Part A of the said urgent application
is
irrelevant for the purposes of this application I will confine myself
to Part B of the said application which is a part in which
the
applicants seek an order of rescission of the aforementioned
judgment. This application is opposed by the first respondent
who is
the applicant in the main application. The first respondent has for
that purpose filed an opposing affidavit. For the purposes
of
convenience I will refer to the parties by the names they chose to
call themselves in this application for rescission.
[3]
The application for rescission is brought on the ground that the
applicants were not served with a copy of the papers that resulted
in
the default judgment and that therefore they did not know that an
application was brought against them. They contend on that
basis that
they were not in wilful default. Secondly, they blame the delay in
the completion of the construction of their house
on the difficult
challenges that they had in having their house plans approved.
Before dealing with the ground upon which
the applicants’
application is founded, it is only apposite to deal with the
preceding events.
[4]
The applicants describe themselves as follows, the first applicant as
a design technician, and the second applicant as an electronic
technician who at the time they launched this application were
residing at […] Street, […] Wallberry Hill, Heuwelsig
Ext, Celtisdal in Centurion. It is unknown when they started living
at the aforementioned address. They are married to each other
in
community of property. With a financial loan secured from the third
respondent, a registered company duly registered as such
in terms of
the company statutes of this country, the applicants bought the
property known as Erf […], Midstream Estate,
Extension 19
Township, Registration Division JR, Gauteng, measuring 1144m²
(“the property”), from one Josephus
Oosthuizen
(“Oosthuizen”), on 23 March 2010. They contend that when
they purchased the said property it was explained
to them that there
was a restriction imposed in the title deed in terms of which the
construction of their dwelling had to commence
sometime during 2006.
As they purchased the property in 2010 they believed that the
restriction had lapsed. Mainly because of Oosthuizen’s
failure
to comply with the building restrictions they were subjected to the
payment of double levies on the same property.
[5] The applicants had a
difficulty in having their building plans approved. Here is catalogue
of the problems they experienced
and the steps they took to obtain
approval of their plans:
5.1 After they had
received their plans they submitted them for approval to the
Midstream Estate, which duly approved them. When
they submitted the
said plans to the local authority for further approval, it was
discovered that the plans were faulty. The fault
lay in the fact
that, as it stood on the building plans, their dwelling would
encroach upon the restriction adjacent to an as yet
to be constructed
road. The local authorities then referred the applicants to the
Department of Roads and Transport of the Gauteng
Provincial
Government.
5.2
This process, according to the applicants, took approximately a
year. On 25 May 2012 the applicants agreed with Phillip
Tine
Trading Close Corporation that the Close Corporation should build
their house. The relevant written agreement, a copy of which
is
attached to their founding papers, was signed by the parties on 25
May 2012.
[6]
On 7 September 2012 the said Department approved the applicants’
building plans. A certificate from National Home Builders
Council in
respect of the said Close Corporation and without which the building
operation could not commence was only obtained
on 28 September 2012.
[7] After they had
secured the approval of the said Department of their building plans
on 29 November 2012 they received a written
letter of demand from the
first respondent, a company duly registered with limited liability
according to the company statutes
of this country with its registered
office located at Bondev Office Park, 3 Ashford Street, Midstream,
Ekurhuleni, in which letter
the first respondent demanded that the
applicants commence with their building operation on or before 30
January 2013. The said
letter stated,
inter alia
, that:
“
If
you do not start to build soon or on or before the 30
th
January 2013, we will proceed with legal action to retransfer Erf
[…], as stipulated in clause 11 of the original Offer
to
Purchase transaction between yourself and Bondev. No further
extension of time will be considered nor granted.”
The
applicants contend that they understood the letter to mean that they
were given a new deadline to commence building their house.
[8]
On 18 December 2012 the applicants obtained the local authority’s
approval of their building plans. They contend that
because the
building industry had already closed by the time they received the
local authority’s approval of their building
plans, the
builders could not commence with the construction of their house.
[9] On 21 February 2013
the second respondent sent a letter to the first respondent’s
attorneys. It is clear that the said
letter was sent in response to
the relevant attorney’s letter dated 4 February 2013. A copy of
the letter has not been attached
to their application. In this letter
dated 21 February 2013 the second applicant informed the attorneys
that:
“
A
letter dated 29 November 2012 was received from Bondev with regard to
the development of Erf […] and instructing that building
should start on or before 30 January 2013. The necessary
response was sent to the builder and building commenced on January
2013 which is before the given date.”
It
is equally important to point out that there is no trace in the
papers of the necessary responses referred to in the last paragraph.
[10] The applicant
testified that on 28 March 2013 the first applicant received a
without prejudice letter from Mr. Riaan du Randt
of Tim du Toit and
Co in which the said attorney indicated that the first respondent
granted the first applicant a further extension
of the building on
certain conditions. All that the applicant in the said email attached
to the applicants’ papers said is:
“
Dear
Madam
We
refer to the abovementioned matter and your response of 21 February
2013 which you indicated that you have instructed the builder
to
commence building operations on/before 30 January 2013.”
A
full copy of this relevant email is however attached to the first
respondent’s answering affidavit as ‘AA7’
at page
109 of the papers. The rest of the paragraphs of the email state as
follows:
“
Please
take note that you are in transgression of the relevant Title
Conditions for many years and that our client is not prepared
to
grant a further extension for the building period.
Our
client has however noted that you commenced with building in the past
few days and our client will consider, without prejudice
of its
rights, and simply in an effort to curtail the issues, and settle the
issue, to consider to extend the building period on
the following
conditions:
1. you must sign the
attached document and agreement for the extension of the building
period on the terms and condition stipulated
therein and attach
hereto;
2. you must submit a
building program in respect of the expected time period for the
completion of the building;
3. a penalty of
R50,000.00 (fifty thousand rand) has to paid to Bondev Developments
Pty Ltd;
4. Proof that finance
have been obtained or is available for payment must be submitted.
Under these
circumstances please revert urgently within 7 (seven) days, failing
which our client will interdict the building process.
Yours faithfully
Riaan
du Randt”
[11] On 10 April 2013 the
second respondent sent an email to Mr. du Randt in which she informed
him that the building construction
commenced on 16 January 2013 and
in which reference was made to a letter from Supa Rafts Reinforced
Raft Foundation dated 3 April
2013. The rest of the paragraphs
state as follows:
“
It
is however our belief, with all due respect, that whoever is
responsible for inspecting sites did not do so on the cut-off date.
Should they have done so they would have seen that we had already
started by then, and not a few days ago (from 28 March 2013)
as
indicated in their correspondence.
We
fully acknowledge that Bondev has a right to impose conditions and
penalties wherever necessary at its discretion and are willing
to
adhere by the rules of the estate.
It
is also our desire that this issue be settle speedily and we
therefore kindly request that Bondev reconsider and revise the
stipulated conditions as we did adhere to the final starting date.
Your
consideration is highly appreciated.
Regards
Chryselda
Mushwana”
[12]
It is the applicants’ testimony that the construction on the
property commenced on 16 January 2013; that since then the
construction has been on-going without any interruption and that the
construction has already reached the first floor stage.
It is
furthermore their testimony that they have already expended the sum
of R907,066.20 towards the cost of the construction.
All these
details, according to the applicants, explain why the building
construction was not completed within the recorded time
as required
by the conditions of the title deed.
[13]
With regard to their failure to oppose the first respondent’s
application, the applicants state that they were not aware
of such an
application because they had not received any notice of the
application. In principle the applicants contend that they
were not
aware of the first respondent’s application because they had
not been served with a copy of the relevant application.
The first
respondent’s application was served at […] Avenue, the
Reeds. This is the address that the applicants had
chosen in the
Extension of Building Period – Midfield Estate.
[14]
Evaluation
I
prefer to start the evaluation with the applicants’ point that
they were not aware of the first respondent’s application.
In their answering affidavit, the first respondent contended that
service of its application on the applicants had been properly
effected. This was so because it was effected at the applicants’
chosen domicilium citandi et executandi. The applicants
admit that
service took place at their domicilium address but contend that they
had not been living there in consequence of which
the first
respondent’s application never caught their eye. On the other
hand, the first respondent states that even if the
applicant had
shifted, they never informed the first respondent that they had moved
from their domicilium citandi. Therefore the
applicants never chose a
new domicilium citandi et executandi.
[15]
The law
If
a party to be served has chosen an address where he prefers to be
served, service of the court papers may be effected by delivering
or
leaving a copy of such court process or document at the address so
chosen. According to
Cohen and Another v
Lench and Another
2007 (6) SA 132
(SCA) paragraph 35
service
must be at the exact chosen and not, for instance in the case of a
townhouse, at the main gate of the complex. In a dispute
as to
whether a party served at the domicilium et executandi all that the
plaintiff has to do is to prove that the defendant chose
the said
address. In
Van der Merwe v Bonaero Park
Edms Beperk 1998(1) SA 697 TPA at 701
the
Court cited with approval the following passage from
Amcoal
Colliries Ltd v Truter 1990(1) SA 1(A) at pages 5J-6B
:
“
(if
a man choses domicilium citandi the domicilium he chooses is taken to
be his place of abode:
(see
Pretoria
Hypotheek Maatschappij v Groenewald
1915 TPD 170
.)
It is a well-established practice (which
is recognised by Rule 4(1)(a)(iv) of the Uniform Rules of Court)
that, if a defendant has
chosen a domicilium citandi, service of
processes at such place will be good, even though it be a vacant
piece of ground, or the
defendant is known to be resident abroad, or
has abandoned the property, or cannot be found.”
Accordingly
service at the
domicilium
will be good even if it is clear that the process has not come to the
notice of the applicants. This Court finds as a result that
there was
proper service of the first respondent’s process on the
applicants at their chosen
domicilium
citandi et executandi.
[16]
In order to succeed with their application for rescission of the
default judgment, the applicants must show good cause for
the
rescission of the judgment. An application for rescission of
judgment is not an enquiry about whether or not to penalise
a party
for the failure to follow the rules and procedures. The question is
always whether or not the explanation for the default
gives rise to a
probable inference that there is no
bona fide
defence. The
discretion to rescind the judgment must always be exercised
judicially and is primarily designed to enable the Court
to do
justice between the parties.
[17] Even if the Court
finds that service of a copy of the first respondent’s process
on the applicants was good, the Court
still has to determine whether
the explanation given by the applicants with regard to their default
was reasonable. “A
reasonable explanation” is part
of the good cause that an applicant for rescission of a judgment must
establish in order
to succeed. The reasonableness of the
explanation does not depend on whether or not service of a legal
process was good.
It is an issue that the Court must determine
separately irrespective of the nature of the service. The fact that
the service was
effected at the chosen place does not necessarily
imply that an applicant for rescission of judgment should not explain
his default
or that if he does his explanation is automatically
unreasonable by reason of the fact that service of the processes on
him was
good. Therefore the fact that service of a process on a party
was proper cannot alone defeat an application for rescission. It is
not in dispute that the applicants were in default of delivery of
their notice to oppose the first respondent’s application
but
the question still is was such default wilful or did it emanate from
gross negligence on their part. ‘Wilful’
in this
context means knowledge by the applicants that the first respondent
had taken action against them; appreciation of the
legal consequences
of such an action and a conscious decision taken freely to refrain
from entering an appearance. Schreiner,
JA, as he then was had
the following to say at
pages 352 to 353
of
Silber v Ozen
Wholesalers Pty Ltd 1954(2) SA 345(AD)
:
“
The
meaning of “good cause” in the present sub-rule, like
that of the practically synonymous expression, sufficient
cause,
which was considered by this Court in Cairns’ Executors v Gaarn
1912 AD 181
, should not likely be made the subject of further
definition. For to do so may inconveniently interfere with the
application
of the provision for cases not at present in
contemplation … it is enough for the present purpose to say
that the defendant
must at least furnish an explanation of his
default sufficiently full to enable the Court to understand how it
really came about,
and to assess his conduct and motives.”
[18] The applicants’
explanation for their default must pass a test of reasonableness and
must not appear that their default
was wilful or due to gross
negligence. In
Saraiva Const. Ltd v Zululand Electrical and
Engineering Wholesalers (Pty) Ltd 1975(1) [D & C.L.D] 612
at page 614
the Court approved of the following passage from
Naidoo v Cavendish Transport Co. ( Pty) Ltd
1956 (3) SA 244
D
and
Grant v Plumbers Pty Ltd 1949(2) SA 470 (O) at p
476.
“
It
seems to me that what is required in a case such as this is that the
applicants must explain his default. He cannot simply claim
the
Court’s indulgence without giving an explanation. The
explanation must be reasonable in the sense that the phrase was
used
in Naidoo’s case and Grant’s case, supra, namely that it
must not show that his default was wilful or was due
to gross
negligence on his part. If explanation passes that test, then the
Court will consider all the circumstances of the case,
including the
explanation, and will then decide whether it is a proper case for the
grant of indulgence.”
In
my view, the explanation proffered by the applicants is reasonable
and the Court accepts it.
[19]
I now turn to examining whether the application is
bona fide
and whether the applicants have disclosed a good defence to the claim
and whether they would have resisted the first respondent’s
application. This Court cannot resolve this issue without referring
to the building conditions imposed on the applicants.
[20] Clarity on the
building restrictions imposed on the applicants was obtained from the
testimony of the first respondent when
no such could be obtained from
the evidence of the applicants. All that the applicants state
in their founding affidavit
is that:
“
12.
At the time it was explained to us that there was a time restriction
imposed in the title deed in that building operations had
to commence
some time during 2006. However, as we purchased the property
during 2010, the time for building had already lapsed.”
In
my view the applicants are not honest with the Court. They
failed, for no apparent reason, to make reference to the terms
of the
“Extension of Building Period”, which is annexure ‘AA2’
to the first respondent’s affidavit.
They pretend that the
building restrictions imposed on the property were the ones imposed
on Oosthuizen. They do admit though that
at the time they bought the
property it was explained to them that there were building
restrictions imposed in respect of the property.
To compound their
case, the applicants did not mention the identity of the person who
explained this condition to them and how
he did it.
[21]
According to the testimony of the first respondent, on 13 April 2010,
the applicants and the first respondent concluded an
agreement for
the Extension of the Building Period in terms of which the
applicants’ dwelling had to be erected within 12
months from 13
April 2011, in other words, before the end of April 2011. This
agreement was attached to the answering affidavit
as annexure ‘AA2’.
I proceed to deal
in extenso
with the contents of the said
annexure hereunder.
[22] It is the first
respondent’s testimony that a condition of title was
transferred from Oosthuizen and that it remained
applicable to the
applicants; that the applicants took transfer in accordance with
annexure ‘AA1’ registered with the
Register of Deeds at
the time of transfer subject to the condition ‘B’ of the
title deed. Annexure ‘AA1’
stated, among others, that
“
voorwaarde ‘B’ in die titel is nog nie aan
voldoen nie en moet staan as a voorwaarde.”
Condition ‘B’
of the title deed is annexure ‘AA2’. For the purposes of
completeness I will quote the whole
of annexure ‘AA2’ and
do so because the First Respondent’s letter dated 29 November
2012.
“
I
RN and CT Mushwana, ID […] / […] prospective owner of
stand number […], Midstream, Extension 19, choose my
domicilium citandi et executandi as […] Avenue, The Reeds,
Centurion and hereby acknowledge that I am aware that:
1. Original building
period namely 18 (eighteen) months after proclamation expired on 31
December 2007.
2. Bondev is entitled
to purchase the stand back, at the original selling price which
Bondev sold the stand for.
3. There are
Aesthetical Rules for Midfield Estate.
4. The construction
period is 9 months.
5. Extra levies will
be imposed by the Midfield HOA should the original building period be
exceeded.
I
undertake to
1. Immediately proceed
with the preparation of building plans and lodge building plans
within 45 calendar days hereof at the Aesthetical
Committee.
2. Appoint a building
contractor within 80 days hereof.
3. Supply Bondev with
a monthly building program within 80 days hereof.
4. Start construction
within 90 days after acceptance hereof.
5. Complete
construction within 5 months hereof.
I
understand that this agreement does not negate or affect:
1. Bondev’s
rights in terms of the original offer to purchase and the title deed.
2. The decision of the
whole owners association to charge an extra levy.
Bondev hereby extends
the building period by a maximum of 12 months, on condition that this
undertaking is strictly complied with.
Signed
at Pretoria on this 13
th
day of April 2010.
Prospective
owner witnesses
Bondev
Midrand Pty Ltd witnesses.”
[23] According to Mr.
Horn, counsel for the first respondent, the first respondent’s
application was designed to enforce a
title condition. He argued
furthermore that the applicants were obliged to build their dwelling
within eighteen (18) months. It
was argued furthermore by Mr. Horn
that on 23 June 2010, which is the date on which the property was
registered in the names of
the first respondent, the applicants
received transfer of the property subject to the following title
condition contained in the
deed of transfer:
“
B.
Onderhewig aan die volgende voorwaarde opgelê en afdenkbaar
deur Bondev Midrand Eiendoms Beperk (2000/027600/07), naamlik:
Transportopnemer,
sy opvolgers en titel of regverkrygendes, is verplig om ‘n
woonhuis op die eiendom op te rig binne 18 (agtien)
maande vanaf 28
Junie 2006 by gebreke waarvan die transportgewer geregtig sal wees,
maar nie verplig nie, om te eis dat die eiendom
aan die tansportgewer
op die koste van die transportopnemer getransporteer word teen die
betaling van die oorspronklike koopprys,
rentevry. Die
transportopnemer sal nie die eiendom binne gemelde tydperk mag
verkoop of oordra sonder skriftelike toestemming van
die
transportgewer nie. Hierdie tydperk kan binne die diskresie van
die Ontwikkelaar verleng word.”
It
was argued by Mr. Horn that the applicants were at the material time
aware that the title deed imposed a restriction with regard
to the
time within which a building on the property had to be erected. It
may be so that the title deed imposed a building restriction.
In my
view, the above restriction or condition did not apply to the
applicants at all because at the time the applicants became
the
successor-in- title, the period of 18 months commencing on 28 June
2006 had already lapsed. That clause was, in my view, invalid.
The
applicants could not have commenced building on 28 June 2006 long
before they were the purchasers of the said property. Accordingly
the
fact, if it be a fact, that the applicants were obliged to complete
building their dwelling within 18 months commencing from
28 June
2006, even if they were aware of it, is debatable.
[24]
No other document placed before this Court provides for a period of
18 months reckoned from 23 April 2010 or from the date
on which the
property was registered into the applicants’ names, the period
within which the applicants were obliged to complete
the construction
of their dwelling. The applicants might have been aware, at the
relevant time, that the title deed imposed a restriction
with regards
to the time within which a building on the property had to be erected
but certainly that time period was not set out
anywhere in the papers
after they had purchased the property from the previous owner.
[25]
On 13 April 2013 the applicants undertook to immediately proceed with
the preparation of building plans and to lodge such building
plans
within 45 calendar days of 13 April 2013 at the Aesthetical
Committee. In their founding affidavit the applicants testified
that they took steps to have the plans drawn up. This evidence has
not been contradicted. All that the first respondent states
is that
it is irrelevant. In my view this evidence is not irrelevant
because the applicant had undertaken to do so and they
did. They took
steps to have their building plans prepared. In other words they
fulfilled their undertaking that they would attend
to the preparation
of the building plans within a period of 45 days.
[26] The applicants
undertook, in terms of annexure ‘AA2’, to complete the
construction of their building within 12
months of 13 April 2010.
In other words the applicants had from 13 April 2010 to 12 April 2011
to complete the construction
of their house. The said period was,
however, extended by another period of twelve months. This is clear
from the following:
“
Bondev
hereby extends the building period by a maximum of 12 months on
condition that this undertaking is strictly complied with.”
Accordingly
the applicants had an additional period of 12 months commencing on 13
April 2011 to 12 April 2012 to complete the construction
of their
building. There can only be an extension of a period of time if there
is already an original period set. Come 12 April
2012 the applicants
had not finished building their house because of the delay in
finalising their building plans. I have already
dealt with this
evidence. In my view the explanation that the applicants’ gave
in their effort to get the building plans
is reasonable. The drawing
of the plans was not within their powers. Even if it was, it still
had to be approved by people other
than the applicants themselves.
It is clear that the undertaking the applicants made on 13 April 2010
did not accommodate
such eventualities as the delay in the approval
of the applicants’ building plans.
[27]
Finally, on 29 November 2012 the first respondent sent the applicants
an ultimatum to start building on or before 30 January
2013. They
threatened to proceed with legal action to transfer the property to
themselves as stipulated in clause 11 of the original
Offer to
Purchase the transaction. It is clear that up to this stage the
applicant had not started building their house.
It is also
clear that a new condition required them to start building their
house on or before 30 January 2013. It did not
indicate when
they should finish building their house. It is their evidence
that they started building their house before
the end of January
2013. That is all that they were required to do according to the
letter dated 29 November 2012 from the first
respondent. Secondly, I
have already pointed out that no document was placed before this
Court containing clause 11 that required
them to build their house
within 18 months from the date they became the possessors of the
property. The Court has a discretion
whether or not to grant an
application for rescission of default judgment in favour of an
applicant who having ascertained that
an order has been granted
against him
in absentia
takes expeditious steps to challenge
the granting of such order and to have it set aside. Firstly I accept
that the applicants were
negligent in failing to advise the first
respondent of their new address for service of legal processes but
find that their negligence
was not of such a nature as to prevent
them from getting the relief they seek. Secondly the applicants have
satisfied the requirements
relating to bona fide and prima facie
defence. In my view there is prima facie proof of good defence to the
first respondent’s
claim. In the premises the default judgment
granted against the applicants cannot stand and should be set aside.
Accordingly,
the application is granted and the following order is made:
1. The order granted by
the Court on 14 May 2014 is hereby rescinded and set aside.
2. The applicants are
hereby granted leave to defend the first respondent’s
application which resulted in the order granted
on 14 May 2014.
3. The normal rules of
Court with regard to filing of further pleadings hereafter shall
apply.
4. The
costs of this application for rescission shall be costs in the main
application.
_____________________
P.M.
MABUSE
JUDGE
OF THE HIGH COURT
Appearances
:
Counsel
for the Applicants:
Adv. JM Roos
Instructed
by:
BK
Msimeki Attorneys
c/o
Andrea Rae Attorneys
Counsel
for the First Respondent:
Adv. NJ Horn
Instructed
by:
Tim du Toit & Co. Inc.
Date
Heard:
2015
August 27
Date
of Judgment:
2016
February 3