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[2016] ZAGPPHC 834
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City of Tshwane Metropolitan Municipality v Mnape's Construction CC & Lebothakga Building and Construction CC (81501/2014) [2016] ZAGPPHC 834 (4 March 2016)
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REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
NOT
REPORTABLE
NOT
OF INTEREST TO OTHER JUDGES
CASE
NO: 81501/2014
DATE:
4/3/2016
CITY
OF TSHWANE
METROPOLITAN
MUNICIPALITY
….....................
APPLICANT
AND
MNAPE'S
CONSTRUCTION CC & LEBOTHAKGA
BUILDING
AND CONSTRUCTION CC
….................
RESPONDENT
JUDGMENT
THOBANE
AJ,
[1]
This is an application for rescission of a judgment obtained by
default on the 14th January 2015 before Makgoba J. The judgment
ordered the following;
1.1.
Judgment against the Defendant for payment of the sum of R 855 535-80
being the principal sum outstanding;
1.2.
Interest on the amount of R 855 535-80 at the rate of 15.5% per
annum, calculated and compounded monthly from the 20th November
2013
to date of full payment;
1.3.
The respondent to pay costs;
1.4.
That the Respondent to pay an amount of R 855 535-80 together with
interest calculated and compounded monthly at the rate of
15.5% per
annum from the 20 November 2013 to date of full payment directly into
the trust account of TP Phahla Attorneys, Account
number [6…],
First National Bank.
[2]
This application, which according to the applicant, is brought in
terms of Rule 42 of the Uniform Rules, is opposed by the respondent,
who, over and above opposing the application on the merits has raised
a point
in
limine
to the effect that the
applicant has failed to apply for condonation.
BACKGROUND
FACTS
[3]
The respondent issued summons against the defendant for payment of
the sum of R 855 535-80. The genesis of the claim is an award
of a
tender by the applicant to the respondent for construction of roads
and storm water systems in Block R, Soshanguve.
[4]
According to the summons, the respondent performed work and submitted
invoices for the work already done. The respondent was
subsequently
paid for the work done.
[5]
Thereafter, the respondent on or about the 5th June 2013, submitted a
schedule of quantities or a statement to the applicant
for the amount
in respect of which default judgment was requested and granted. The
respondent contends that it duly ,performed
and complied with the
provisions of the agreement in respect of which the work was
performed and that the applicant failed to make
payment for the work
done.
[6]
The respondent further submitted that despite delivery of a statement
detailing all the work performed as well as the monies
due and
payable, demand in respect thereof, meetings held between the parties
and eventually a notice of intention to institute
legal proceedings,
the applicant failed to make payment in the amount claimed or in any
other amount.
[7]
On the strength of such failure, the respondent issued summons
against the applicant based on the cause of action as aforesaid.
ISSUES
[8]
The following are issues for determination;
8.1.
Whether the point
in limine
as raised is sustainable;
8.2.
Whether the applicant has met the requirements of Rule 42(1)(a).
THE
LAW
[9]
Rule 42(1 )(a) provides that:
"(1)
The court
may,
in addition
to any other powers it may have,mero motu or upon application of any
party affected, rescind or vary:
(a)
An. order or judgment erroneously sought or erroneously granted in
the absence of any party affected thereby."
[10]
In light of the above, the prerequisites that the applicant is
required to satisfy under this sub-rule are the following:
10.1.
the default judgment must have been erroneously sought or erroneously
granted;
10.2.
such judgment must have been granted in the absence of the applicant;
and
10.3.
the applicant's rights or interest must be affected by the judgment.
[11]
It can be taken as established that the judgment was obtained in the
absence of the applicant and also that the order affects
the
applicant's rights or interests. This is common cause. What remains
is for the applicant to discharge the
onus
resting upon
it, of establishing that the default judgment was erroneously granted
or obtained. See
Mutebwa v
Mutebwa
and Another
2001
(2)
SA
193 at page
199
F;
Bakoven
Ltd
v
G
J
Howes
(PTY)
Ltd
1990 (2) SA 446
at page
469
8.)
SUBMISSIONS
[12]
The respondent in support of the contention that the applicant ought
to have applied for condonation, sketches the following
picture;
12.1.
Judgment was obtained by default on the 14th January 2015;
12.2.
The applicant was made aware of the judgment under cover of a letter
dated the 19th January 2015;
12.3.
The parties entered into discussions which included a request by the
applicant for the respondent to abandon judgment. The
respondent
declined such a request;
12.4.
That on the 5th March 2015 they were served with the application for
rescission of judgment, supported by an affidavit which,
ex
facie,
had been commissioned on the 4th March 2015;
12.5.
That on their calculation the application for rescission of judgment
was 11 (eleven) days out of time.
12.6.
That absent consent for filing the application for rescission of
judgment out of time or an application to court condoning
such late
filing, the application for rescission of judgment falls to be
dismissed.
[13]
The contention by the applicant is that in terms of Rule 42 of the
Uniform Rules, all that the applicant needs to show is that
the
application has been brought within a reasonable time and that what
amounts to a reasonable time would depend on the circumstances
of
each case. Further, that the lapse of 11 days was not in these
circumstances unreasonable and that the submission with regard
to an
application for condonation is misplaced.
[14]
It was further argued on behalf of the applicant that the timeframes
self evidently did not point to an unreasonable delay
in launching
the application for rescission and that the counter argument raised
was dispositive of the point
in limine
raised.
[15]
If we accept as contended by the applicant that this application is
brought in terms of Rule 42, then in that event the question
which
arises is whether this application was brought "within a
reasonable time". The common law phrase "reasonable
time"
is generally applied in the context of contractual disputes and does
not admit of a single legally determinative meaning.
The
determination of what constitutes a reasonable time is a fact-bound
inquiry. See
Strachan
&
Co Ltd v Natal
Milling
Co.
(Pty) Ltd
1936 NPD 327
at 333; Cardoso
v
Tuckers
Land and Development
Corporation
(Pty) Ltd 1981(3) SA 54 (W) 63 E.
[16]
The parties, after the respondent had notified the applicant about
the default judgment, discussed, if only briefly, the possibility
of
abandonment of judgment on the part of the respondent. The respondent
was of the view that an application for default judgment
be served or
that the matter be settled along certain lines, which they outlined
in correspondence. It is obvious that the, settlement
discussions did
not succeed hence this application. I do not believe the period of 11
days, being the number of days applicant's
application is out time,
in the circumstances of this case, given that there was an attempt at
settlement, is unreasonable.
WAS
JUDGMENT ERRONEOUSLY GRANTED OR OBTAINED
[17]
The respondent issued summons which were served on the applicant on
the 14 November 2014. The
dies
induciae
was
due to expire on the 12 December 2014.
[18]
On the 12 December 2014 the applicant attempted to serve a notice of
intention to defend at the offices of the respondent's
legal
representative without success. The Candidate Attorney who had
attempted to serve the notice then deposed an affidavit and
filed
same along with the notice of intention to defend with the registrar
of this court. The appearance to defend bears a court
stamp of the 12
December 2014.
[19]
The affidavit explained that there was an attempt to serve the
appearance to defend on the respondent's legal representatives
but
that their offices were found locked. Upon inquiry at a neighboring
office they were advised that the respondent's legal representatives
were closed for the year. The affidavit was thereafter prepared and
filed together with the appearance to defend.
[20]
On the 14 January 2015 the respondent applied for default judgment on
the unopposed basis, which judgment was granted. During
argument I
asked counsel for the respondent how it was possible to apply for
default judgment in circumstances where at the very
least, the
appearance to defend as well as the affidavit filed to explain the
non-service of the appearance, ought to have been
in the court file.
He responded by stating that he was in charge of the matter on the
day and that they had requested the registrar
to prepare a duplicate
file which was populated with copies. This explanation is also
contained in the opposing affidavit. The
judgment therefore was
granted on a duplicate file which explains why the Judge that handled
the matter would not have been aware
that an appearance to defend had
been entered.
[21]
The question thus arises what is the meaning of the words
"erroneously
granted".
This is dealt
with in
Bakoven
Ltd
v
G J
Howes
(Pty)
Ltd
1990 (2)
SA 446
at page
471 E-H,
where it is stated:
“
An
order
or
judgment is
'erroneously
granted'
when
the
Court
commits an
'error'
in the sense of
'
a
mistake in
a
matter of
law appearing on
the
proceedings
of
a Court of
record'
(The Shorter Oxford Dictionary). It
follows that
a
Court in deciding whether
a
judgment
was
'erroneously granted' is, like
a
Court of
Appeal, confined to
the
record
of proceedings.
In
contradistinction
to relief
in
terms
of
Rule 31(2){b) or under the common law,
the
applicant
need not show
'good cause' in
the sense of an explanation
for his default and
a
bona fide defence
(Hardroad
(Pty) Ltd
v Oribi Motors
(Pty) Ltd
(supra)
at 57BF-G; De
Wet
(2)
at 777F-G; Tshabala/a
and
Another
v
Pierre
1979 (4) SA 27
(T)
at 30C-D).
Once the applicant
can
point
to an error in the
proceedings, he
is without further ado entitled to rescission."
[22]
Put differently, a judgment would be erroneously granted if there
existed at the time of issue thereof, a fact of which a Judge
was
unaware, which would have precluded the granting of said judgment,
and which would have induced the Judge, if aware of it,
not to grant
the judgment. See
Nyingwa
v Moolman
NO
1993
(2) SA 508
(Tk)
where
White J, in dealing with an application for rescission brought in
terms of Rule 42 (1)(a), stated as follows at 510 G:
"It
therefore seems that
a
judgment
has
been erroneously been granted
if
there
existed
at
the
time
of
its
issue
a
fact
of
which
the Judge was unaware,
which would have precluded
the granting of the judgment
and
which
would
have
induced
the Judge,
if
he
had
been aware of it, not to grant th
e
judgment."
See also
Naidoo
v Matlala NO
2012 (1) SA 143
(GNP).
[23]
Finally, an order or judgment is erroneously granted if there was an
irregularity in the proceedings. See
Tshabalala
v
Peer
1979
(4)
SA
(T)
at
30H-31A;
National
Pride
Trading 452
(Pty)
Ltd
v
Media
24
Ltd
2010
(6)
SA
587
(RCP)
at
539F-5941.
[24]
The question that inadvertently arises in the circumstances of this
case and in light of the aforementioned authorities is
two pronged
and can be couched as follows;
24.1.
Is there a fact of which the Judge was not aware at the granting of
judgment which had he been aware of, would have precluded
him from
granting the default judgment?
24.2.
Was there an irregularity in the proceedings?
[25]
I take the view that had the Judge been aware that there was an
appearance to defend filed in the Court file, albeit without
proof of
service, but with an affidavit explaining the failure to serve the
notice of intention to defend on the respondent, he
would have
handled the matter differently. For a start, the Judge would have
sought to establish if, in light of the appearance
to defend, a
notice of set down had been served on the applicants. Secondly, the
file that was presented when default judgment
was sought, was a
duplicate file. This explains the absence of the appearance to defend
in the court file, thus depriving the Judge,
without apportionment of
fault on the respondent, an opportunity to deal with the matter in
accordance with the law.
[26]
I consider filing of the appearance to defend with the registrar in
circumstances where same has not been served on the respondent
to be
an irregular step. I am fortified in that view by what is said in
Herbstein
&
Van
Winsen on “The Civil Practice of the High Courts of South
Africa
”
, fifth edition, Vol 1,
page 512;
"........
a notice of intention to defend will be irregular if:
(1)
It has not been properly delivered.
(b)
A notice of intention to defend will be irregular if the defendant,
having filed the original notice with the registrar, fails
to serve a
copy on the plaintiff or attorney. By analogy with the former Cape
practice, it is submitted that in the event of such
failure, the
plaintiff will be entitled to assume that notice of intention to
defend has not been given. If, however, the plaintiff
does so and
moves for judgment, the court will not grant judgment, but will order
the defendant to pay the wasted costs occasioned
by the omission."
See
R O Investments
(Pty) Ltd
v Consolidated
Press
of SA Ltd
1949 (4) SA 454
(C)
and
Ingle
v
Andrew
1924 CPD 40.
[27]
The applicant identifies an irregularity as being the failure of the
respondent to serve a notice of enrollment on them, in
light of the
fact that the matter had become defended. The folly in that argument
is that the respondent could not have been aware
that the matter is
defended as they were not served with the notice of intention to
defend. The defendant would have been aware
only if the notice was
served on them or if the original appearance to defend was in the
court file.
[28]
The defendant denies that the steps they took namely, to apply for
default judgment on the unopposed roll was irregular. I
agree with
their contention. They were fully entitled to approach court and
apply for judgment however had the original file been
available, they
would not have been granted judgment.
[29]
I am accordingly of the view that;
29.1.
Filing of the appearance to defend with the registrar and the failure
to serve same on the respondent was an irregular step.
The
proceedings are therefore tainted with an irregularity.
29.2.
Had the Judge been aware, which awareness he would have gained had
the original file been presented to him, that appearance
to defend
had been filed, albeit not served on the respondent, he would not
have granted default judgment.
[30]
The parties have in detail dealt in the papers with the merits of the
matter. Once an error has been identified, as is the
case, the
applicant is without further ado entitled to rescission. I therefore
do not believe that the merits of the case need
further attention.
COSTS
[31]
The applicant is praying that any party that opposes the application
be directed to pay the costs of this application and in
the
alternative, that costs be costs in the proceedings under case no.
81501/2014. The respondent seeks a cost award in its favour
but goes
further to pray for a cost order on a higher scale. Respondent
contends that the applicant or its attorneys were negligent,
that
they have advanced no
bona fide
defence to the claim and that
they have failed to show good cause why judgment must be rescinded. I
have pointed out the
dicta
from
Bakoven
Ltd
v
G
J Howes
(Pty) Ltd,
in 21
supra,
that a
bona
fide
defence and good cause are not considerations in an application
brought in terms of Rule 42(1)(a). The basis for arguing for a higher
cost order is therefore misplaced.
[32]
Ordinarily costs follow the event. In the circumstances of this case,
the applicant would have been visited with a cost order,
had the
original court file been available, for having acted irregularly in
not serving the notice of intention to defend on the
respondent or
its legal representatives. I do not believe that the respondent
should be burdened with the costs of the application
for default
judgment and the rescission application.
[33]
I therefore make the following order;
33.1.
The point
in limine
is dismissed;
33.2.
The judgment granted by default on the 14th January 2015 is
rescinded;
33.3.The
applicant is granted leave to deliver its plea within 10 days of this
order and;
33.4.
The applicant is directed to pay the costs of this application, save
for the costs of the 31 August 2015.
______________
SA
THOBANE
ACTING
JUDGE OF THE HIGH COURT
APPEARANCES
ATTORNEYS
FOR THE APPLICANT
..........
: GILDENHUIS
MALATJI INC.
COUNSEL
FOR THE APPLICANT
...............
:ADV.
MANALA
ATTORNEYS
FOR THE RESPONDENT
.....
: TP PHAHLA
ATTORNEYS
COUNSEL
FOR THE DEFENDANTS
.........
:ADV. KANYANE