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[2016] ZAGPPHC 214
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Tracklot General Trading (Pty) Ltd v Sethole and Another (7406/2015) [2016] ZAGPPHC 214 (23 March 2016)
IN THE HIGH COURT OF SOUTHAFRICA
GAUTENG DIVISION, PRETORIA
CASE NO: 7406/2015
DATE: 23 MARCH 2016
In the
matter between:
TRACKLOT
GENERAL TRADING (PTY)
LTD
.................................................................
Applicant
And
SETHOLE, BUSISIWE
AGNES
................................................................................
First
Respondent
TOBIPROX (PTY)
LTD
.........................................................................................
Second
Respondent
SHELL
SOUTH AFRICA MARKETING (PTY)
LTD
...........................................
Third
Respondent
DATE OF
HEARING: NOVEMBER 2015
JUDGMENT
[1]
This is an application to strike out the
first and second respondents’ opposition to the main
application, as well as the
counter application of the first and
second respondents. The application results from the respondents’
alleged failure to
comply fully and properly with the rule 35(12)
notice of the applicant. The applicant also seeks orders in terms of
the relief
sought in the main application.
[2]
The applicant is Tracklot General
Trading (Pty) Ltd, a private company incorporated in terms of the
laws of South Africa. The first
respondent is Busisiwe Agnes Sethole;
the second respondent is Tobiprox (Pty) Ltd, a company duly
incorporated in terms of the
law of South Africa; and the third
respondent is Shell South Africa, also a company duly incorporated in
terms of the law of South
Africa. The third respondent does not
oppose the main application.
[3]
The respondents filed an answering
affidavit along with a counterapplication to the applicant’s
notice of motion. The
applicant has not yet filed a replying
affidavit, which will serve also as its answering affidavit to the
counter-application.
[4]
The applicant contends that it cannot
file its answering affidavit until the respondents have produced for
inspection certain documents
referred to in the respondents’
answering affidavit. The respondents were served with a rule 35(12)
notice, but have not
fully complied, according to the applicant. The
respondents contend that there was compliance by them.
[5]
The answering affidavit was served on 11
March 2015. On 17 March, the applicant served its rule 35(12) notice,
followed by the rule
30A notice on 27 March 2015. The reply of the
respondents to the 35(12) notice was served on 2 April 2015. The
application to strike
out, which now serves before the court, was
served on 15 April 2015. The inspection of the documents made
available by the respondents
occurred on 13 April 2015.
[6]
The respondents raise a number of points
in limine. I shall with them to the extent that they arise during the
course of the judgment.
With regard to the point that premature
notice had been given in terms of rule 30A, applicant argues that
35(12) specifies no time
period and that there is nothing to prevent
a party from sending out notice immediately. I do not consider it
necessary to deal
with this point extensively. For purposes of this
application I shall assume that notice was not premature, in order to
consider
the actual merits of this rule 35(12) application.
[7]
Applicant conveniently divided the
responses of the respondents to the rule 35(12) notice into 5
categories. For the sake of convenience
I shall use these categories
for the ensuing discussion.
Documents which the respondents claim are
privileged and which have no bearing on the case
[8]
The relevant documents are the bank
statements and management accounts of the second respondent, which it
claims are privileged
and of no relevance to the case.
[1]
The applicant submits that this is not a defence, and that the
documents are relevant as it is the case of the applicant in the
main
application that money from the business is being diverted to the
second respondent - a so-called “hijacking of funds”.
[9]
Privilege depends on the reason for the
communication and the existence of a legal relationship between the
client and the legal
adviser.
[10]
The applicant contends that the bank
statements are not privileged, as they are not a private
communication between attorney and
client. But even if there existed
some sort of privilege, it was waived because of the answering
affidavit.
Documents which are not in the possession of
the respondents
[2]
[11]
Two documents are at issue here: the
alleged judgments against the applicant’s representatives
Blacher and Craig Edmonson,
and the resignation of the first
respondent as a director of the applicant.
[12]
it is claimed by the respondents that
the consent of both parties will be necessary to obtain the judgments
from the credit bureaus.
No explanation is offered why this is so,
says the applicant.
[13]
Regarding the resignation letter,
respondents’ attorney in the resisting affidavit said that it
was produced for inspection,
but applicant contends that it was not.
[14]
The applicant argues that if the
respondents are not in possession of a document, it is not sufficient
for them to merely state
that they are not in possession of the
document. The must give reasons.
Documents which are in possession of a named
third party
[3]
[15]
The respondents claim that the documents
referred to in paras 10, 13, 14, 17, 18 and 19 of the notice are in
the possession of the
third respondent, and that the applicant can
obtain these from the third respondent itself. The applicant says
that the respondents
should have filed an affidavit explaining why
they cannot produce the documents.
[16]
The respondents claim that the documents
referred to in paras 22 and 23 are in the possession of Craig
Edmonson. Again, there is
no explanation why these documents cannot
be obtained by the respondents from him, says the applicant.
Documents that do not exist
[4]
[17]
Respondents simply stated that these
documents do not exist, except in respect of documents 15 and 21
which they said were not concluded.
In the resisting affidavit the
attorney stated that the documents do not exist. The applicant once
again questions why no affidavit
was filed.
Documents which respondents advised were
available for inspection but which were not
[18]
The applicants claim that the documents
referred to in paras 2, 4 and 7 of the rule 35(12) notice were not
made available, even
though the respondents said they would be.
[19]
The essence of the applicant’s
case seems to be is that all documents referred to in the answering
affidavit must be produced,
if requested. This obligation arises as
soon as it is referred to in the affidavit and its annexures. If a
party refuses to produce
the document, it must provide facts to
relieve if of this obligation, plus provide cogent reasons for the
refusal. If the party
claims that the document is not relevant, the
party must prove that the document is irrelevant.
[20]
The documents can be requested to allow
the applicant to consider its position even before the respondent has
disclosed its defence
or even knows its defence. Even if a document
is not in its possession, a party is under an obligation to produce
it. If it cannot,
the party must set up facts to support why the
document is not in its possession, facts why the document cannot be
obtained and
facts why it is unable to produce the document.
[21]
In support of its arguments, the
applicant relied on a variety of case law. Of relevance is Gorfinkel
v Gross, Hendler & Frank
1987 (3) SA 766
(C) at 774G-I:
[T]he
rule should, to my mind, be interpreted as follows: prima facie there
is an obligation on a party who refers to a document
in a pleading or
affidavit to produce it for inspection if called upon to do so in
terms of Rule 35(12). That obligation is, however,
subject to certain
limitations, for example, if the document is not in his possession
and he cannot produce it, the Court will
not compel him to do so.
(See the Moulded Components case supra at 461D-E.) Similarly, a
privileged document will not be subject
to production. A document
which is irrelevant will also not be subject to production. As it
would not necessarily be within the
knowledge of the person serving
the notice whether the document is one which falls within the
limitations which I have mentioned,
the onus would be on the
recipient of the notice to set up facts relieving him of the
obligation to produce the document.”
[22]
The most recent authority is Governing
Body, Hoerskooi Fochvifle and Others v Centre for Child Law
2014 (6)
SA 561
(GJ) where Sutherland J conveniently summarised the relevant
law (par 25):
25.1
There is clear authority that
confidentiality does not trump the rule.
25.2
There is some authority for the
proposition that rule 35(12) must be literally interpreted, and
irrelevant and privileged documents
must be disclosed. I am in firm
disagreement with such a view.
25.3
There is some authority, which is
nevertheless obiter, to support the idea that an irrelevant or
privileged document, if referred
to in a pleading or affidavit,
cannot be subjected to compulsory disclosure in terms of rule 35(12).
I am in firm agreement with
this view.
25.4
Therefore, I hold that, upon a proper
interpretation of rule 35(12), a party called upon to comply with
rule 35(12) is excused from
so doing, if that party shows that the
document sought is irrelevant to the issues in the matter, or is
privileged, but cannot
be refused on the grounds of confidentiality.”
[23]
Sutherland J’s decision was
appealed to the Supreme Court of Appeal, which gave judgment in
October 2015, shortly before this
matter was argued before me. See
Centre for Child Law v The Governing Body ofHoerskool Fochville and
Another Case no 156/2015,
as yet unreported. It overturned the order
of the court a quo. After referring to Gorfinkel, Ponnan JA stated
the following about
the 35(12) enquiry and the use of onus (par 18):
For
my part, I entertain serious reservations as to whether an
application such as this should be approached on the basis of an
onus. Approaching the matter of the basis of an onus may well be to
misconceive the nature of the enquiry. I thus deem it unnecessary
to
attempt to resolve the disharmony on the point. That notwithstanding,
it is important to point out that the term onus is not
to be confused
with the burden to adduce evidence (for example that a document is
privileged or irrelevant or does not exist).
In my view, the court
has a general discretion in terms of which it is required to try to
strike a balance between the conflicting
interests of the parties to
the case. Implicit in that is that it should not fetter its own
discretion in any manner and particularly
not by adopting a
predisposition either in favour of or against granting production,
And, in the exercise of that discretion, it
is obvious, I think, that
a court will not make an order against a party to produce a document
that cannot be produced or is privileged
or irrelevant.
[24]
From this it is clear that court has a
discretion which should be exercised in such a way as to attempt to
strike a balance between
the interests of the various parties. In my
view the court should be guided in the exercise of this discretion by
the justifications
given by the party for resisting the delivery of
the particular document. In other words, if a party resists the
delivery of a
particular document, he should adduce evidence why he
is resisting. It is only with this evidence that the court would be
in a
position to exercise its discretion properly and appropriately.
But it is important that neither party should be prejudiced unfairly
in this process.
[25]
Aside from expressing itself on the use
of onus itself as a test, the court did not expressly disagree with
the summary of the law
given by Sutherland J. In fact, the judgment
seems to me to support the principle that a court should not order a
party to deliver
up for inspection a document which he cannot produce
(as it is likely not in his possession), which is privileged or which
is irrelevant.
[26]
I align myself fully with the view
expressed by Sutherland J in par 25.4 of his judgment that a party
need not produce a document
which he has shown to be irrelevant or
privileged. However, confidentiality is not a defence. And in line
with Gorfinkel’s
case, a document that the party can show is
not in its possession also need not be produced.
[27]
Dealing with the specifics, in respect
of the alleged privileged documents, it would have been of benefit to
the court had there
been more extensive legal argument on this point.
Mindful of the need for balance, I think the release of these
documents could
potentially be of relevance, but there is also the
need to consider privilege. I am of the opinion that they need not be
released.
They are not essential to the applicant to prepare his case
at this stage.
[28]
In respect of the documents that the
respondents claim are not in their possession, they need to set up
facts to support this claim.
If they know who else is in possession
of the requested document, they should reveal who this is. But this
raises the other issue
of whether the party should obtain the
requested document from this other party.
In
Moulded Components and Rotomoulding South Africa (Pty) Ltd v
Coucourakis and Another
1979 (2) SA 457
(W) Botha J dealt with the
situation where a document is referred to, but not in possession of
the party:
Counsel
for the applicant contended that the answer should be positive, on
the basis that the working of the Rule is wide enough
to cover such a
situation, but conceded that if it should appear that the party was
unable to produce a document not in its possession,
the Court would
obviously not make an order against that party in terms of the Rule.
Counsel for the applicant suggested further
that the situation was
analogous to the case of the production of objects alleged to have
been in the possession of a party, as
dealt with in [the Claude Leon
case]. On that basis counsel urged that when once a document is
referred to in an affidavit there
is liability to produce that
document when production is called for in terms of the Rule, unless
the party in question can show
that he is unable to comply with the
notice in terms of the Rule, in the sense that he cannot produce the
document I go along with
this argument, in principle. It seems to me
that it is easy to conceive of cases where a document is not in the
actual physical
possession of a party, but where the Court would
nevertheless not hesitate to make an order in terms of Rule 35(12). I
agree also
with the qualification expressed by counsel for the
applicant, namely that where the party in question cannot produce the
document,
it is obvious that the Court will not make an order against
him in respect of such a document, (my emphasis)
I
think at least a reasonable attempt should be made to find the
document and produce it. If such an attempt was made, but
unsuccessfully,
this should be confirmed by affidavit. Where a
document is simply not in possession of the party and he has no
knowledge of where
it can be found, a court would not be able to
force compliance. But if the party knows where the document can be
found, it must
at least make an attempt to find it.
[29]
If a document does not exist, this needs
to be stated in an affidavit. I am satisfied that this is sufficient.
I do not think that
more than this is required.
[30]
The respondent argued that an
application for striking out was premature and there should first
have been an application to compel
discovery. In no case has an order
of striking out been granted. The applicant argued that rule 30A does
not require an order to
compel first, but it was conceded that it is
within the discretion of the court to make such an order. The more
appropriate relief
would be an order to compel.
ORDER
[31]
In the result I make the following
order:
1.
The
first and second respondents are ordered to produce for inspection
the following documents as stipulated in the rule 35(12)
notice:
AH
documents which are referred to in paras 8, 10, 12, 13, 14, 17, 18,
19, 22 and 23 of the notice which the respondents have identified
as
being in the possession of a third party. In the event of the
respondents not being able to produce these documents after making
a
reasonable effort to do so, the respondents shall furnish the
applicant with an affidavit setting out their inability so to produce
and the reasons for such inability.
2.
Respondents
are ordered to comply with paragraph one of this order within 14
days.
The
respondents are to pay the costs of the application.
OLIVIER AJ
ACTING
JUDGE OF THE HIGH COURT, PRETORIA
[1]
See paragraph 25 of the rule 35(12) notice.
[2]
Documents referred to in paras 8 and 12 of the 35(12) notice.
[3]
Documents referred to in paras 10,13,14,17,18,19,22 and 23 of the
35(12) notice.
[4]
Documents referred to in paras 11,15,16,20 and 21 of the 35(12)
notice.