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[2016] ZAGPPHC 247
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Absa Bank Ltd v Van Zyl NO and Another (35976/2015) [2016] ZAGPPHC 247 (22 April 2016)
HIGH COURT OF SOUTH
AFRICA
(GAUTENG DIVISION,
PRETORIA)
Case no. 35976/2015
Not reportable
Not of interest to
other judges
Revised
22/4/16
In the matter between:
ABSA BANK
LTD
Applicant
and
A.H. VAN ZYL
N.O.
First
Respondent
N. M. KILIAN
N.O.
Second
Respondent
JUDGMENT
RABIE, J
1. The applicant applied
for the provisional sequestration of the Doornbult Trust which
conducts farming operations in the North
West Province. The applicant
bank instituted an action against the trust which resulted in an
order during November 2011 for payment
of approximately R2,5 million
to the applicant. All attempts to appeal the order were unsuccessful.
2. During August 2014 a
writ for attachment of movable property was obtained and according to
the applicant a Sheriff of the High
Court was instructed to execute
same. According to the applicant the return of the Sheriff was one of
nulla bona
and it was on the basis of this alleged deed of
insolvency which the applicant based its application for
sequestration. In the alternative
it was submitted that the trust is
factually insolvent.
3. I shall deal first
with the issue of the alleged deed of insolvency. On behalf of the
respondent it was submitted that the writ
of execution relating to
movables was not executed by a Sheriff of the High Court, that the
applicant has consequently failed to
prove a deed of insolvency on
the part of the respondent with the result that the application
should be refused.
4. It is necessary to say
a little more about the execution process in this matter. On behalf
of the applicant it was stated that
the writ of execution was duly
executed by the Sheriff, Mr B. Mosikili. According to the first
respondent, who is one of the trustees
of the trust, the writ was
never executed by Mr Mosikile. He stated that on 3 February 2015 Mr H
Barkhuizen of the office of the
Sheriff of Schweizer Reneke came to
the farm on which the farming operations are conducted. He was
apparently armed with the writ
of execution relating to the movables
of the trust. It is not exactly clear what happened on that day. The
first respondent stated
in this regard the following in paragraph 14
of his answering affidavit:
"14.1 Ek bevestig
dat ek deur Hannes Barkhuizen besoek was en is ook 'n persoon wat ek
ken. Hannes het my meegedeel dat hy
deur die bank gestuur is en dat
hy nadat hy hier was 'n dokument moet terug stuur gemeld die verslag
nulla bona.
14.2 Hannes kon nie
presies vir my se wat die beteken nie en het ek derhalwe ook nie
betwis nie." (sic)
5. In the return, under
the hand of Mr Barkhuizen, he stated,
inter alia,
that he
served the document personally on the first respondent and also
stated that after a proper investigation he could not find
any assets
for the outstanding amount. He then stated the following: "Hereby
I submit a nulla bona fide." The reference
to a "nulla bona
fide" is, on the face of it, support for the statement of the
first respondent that Mr Barkhuizen did
not really know what he was
supposed to do on the farm. He clearly also did not ask the first
respondent to point out sufficient
disposable property to satisfy the
judgement. That much is evident from the return itself.
6. The second, and
perhaps biggest problem relating to the execution of the judgement,
is the fact that it appears that Mr Barkhuizen
was not a duly
appointed Sheriff or deputy sheriff of this court. In the answering
affidavit the first respondent disputed the
legality of the nulla
bona return. He stated that Mr Barkhuizen had never lawfully been
appointed as Sheriff or deputy sheriff
of either the Magistrate's
Court or the High Court. He could consequently not have lawfully
executed the judgement against the
trust. As such, the trust did not
commit the deed of insolvency upon which the applicant relied to
prove its entitlement to sequestrate
the trust.
7. In response to the
respondent's allegation that the writ was not executed lawfully by a
sheriff or his deputy, the applicant,
in its replying affidavit
relied in paragraph 15.2.6 on the statement that "the
applicant's attorneys of record were informed
by Mr Mosikile, Acting
Sheriff of Schweizer Reneke, that he was accompanied by Mr Hannes
Barkhuizen to the first respondent, as
the first respondent only
speaks Afrikaans and the Sheriff's Afrikaans is not that good and
requested for a translator." Further
according to the attorney
Mr Mosikile informed them that the first respondent did not
co-operate with the execution process and
that the first respondent
advised him to write down a nulla bona return of service. It was
further stated that the first respondent
did not point out any
disposable movable goods. The clear inference of the aforesaid is
that it is the applicant's case that it
was indeed Mr Mosikile who
executed the writ of execution and not Mr Barkhuizen who had simply
acted as an interpreter.
8. Subsequent to the
replying affidavit the respondents applied for leave to file further
affidavits in response to the replying
affidavit. That application
was granted. The issue which the respondents responded to related to
the validity of the execution
process and more particularly the nulla
bona return.
9. It was reiterated that
Mr Barkhuizen performed the duties as if he were the duly appointed
deputy sheriff but that he had in
fact never been lawfully appointed
and empowered to act as deputy sheriff. Furthermore that when he
visited the farm on 3 February
2015, he was not accompanied by Mr
Mosikile but went there on his own. One of the set of affidavits was
in fact an affidavit by
Mr Barkhuizen himself who was quite adamant
that he had been responsible for the nulla bona return and that Mr
Mosikile most definitely
did not accompany him when he went out to
the farm. He added that Mr Mosikile in any event did not deal with
farms. He also stated
that he remembers the incident very well and
that he went to the farm with the vehicle of his colleague Me Leonie
Engelbrecht.
10. An affidavit by Me
Engelbrecht was also submitted wherein she confirmed the version of
Mr Barkhuizen. She also denied that Mr
Mosikile went out to the farm
on the particular day and said that he had gone to Wesselsbron and
Bloemhof. She also confirmed that
during her time at the office of
the sheriff Mr Mosikile never went to a farm to serve or execute
documents.
11. Both Mr Barkhuizen
and Me Engelbrecht stated that they were never appointed as deputies
despite all their efforts to be so appointed.
Eventually they
realised that they were acting unlawfully and were no longer prepared
to do so. Consequently, both of them resigned.
12. Section 8 of the
Insolvency Act provides for acts of insolvency as follows:
"A debtor commits an
act of insolvency-
(a) …
(b) if a court has given
judgment against him and he fails, upon the demand of the officer
whose duty it is to execute that judgment,
to satisfy it or to
indicate to that officer disposable property sufficient to satisfy
it, or if it appears from the return made
by that officer that he has
not found sufficient disposable property to satisfy the judgment;"
13. From the evidence
before this court it is clear that on the probabilities the judgement
against the trust was not executed by
an officer whose duty it is to
execute that judgement. Firstly, it can hardly be correct that Mr
Mosikile executed the writ of
execution. If he did, he failed to file
a return. The only return that was filed, was signed by Mr
Barkhuizen. On Mr Barkhuizen's
own version he was never duly
appointed as a deputy sheriff and never had the authority to fulfil
the duties of a deputy sheriff.
Consequently the nulla bona return
was invalid and cannot be relied upon for purposes of the
sequestration application launched
by the applicant. In fact, the
averment cannot be made that that the respondent failed to satisfy
the judgment debt at the request
of the Sheriff.
14. For the aforesaid
reasons it is not necessary to refer to the fact that the return was
hopelessly outdated and neither is it
necessary to refer to the
submissions on behalf of the respondent that the execution of the
writ was invalid for the reason that
the respondent was never
requested to point out property to satisfy the judgement.
15. In the alternative to
relying on the aforesaid alleged deed of insolvency, it was submitted
by the applicant that the trust
is factually insolvent and should for
that reason be sequestrated. The submission that the trust is
factually insolvent appears
to be based on an inference drawn from,
firstly, the fact that the trust had not paid the aforesaid judgement
in favour of the
applicant and, secondly, the fact that the trust had
earlier failed to pay the deposit and/or purchase price of a property
purchased
at an auction.
16. The fact that the
trust had not paid the order against it is not necessarily an
indication that it is factually insolvent. That
was in fact denied on
behalf of the trust. As stated above, the attempt to execute in
respect of the trust's movables, was invalid
and cannot be relied
upon.
17. In respect of the
reference to the failure to purchase a property at an auction very
little had been presented. It appears that
an immovable property of
the first respondent, in his personal capacity, had been put up for
auction at the behest of a creditor
of the first respondent. The
trust purchased the property at the sale but there after failed
and/or refused to pay the purchase
price and the agreement was
cancelled. The first respondent's response was that there was a
strong possibility that he would have
sufficient capital to purchase
the property but that it did not realise in time. He was, however, a
bona fide purchaser at the
sale and denies that the only reasonable
inference to be made is that the trust was insolvent.
18. In my view the
inference can indeed not be drawn from the aforementioned facts that
the trust was insolvent or is insolvent
at this time. The property in
question belonged to the first respondent in his personal capacity.
At the auction, the trust purchased
the property because, according
to the first respondent in his capacity as trustee of the trust, he
was of the opinion that the
trust would be able to obtain the
required finance for the transaction. This turned out to be not the
case and the trust did not
proceed with the transaction. The only
inference that can possibly be drawn from these facts is that the
trust was not able to
finance an additional obligation. It does not
prove the factual insolvency of the trust.
19. The applicant did not
present any other facts to prove the trust's alleged insolvency and
the respondents were accordingly not
called upon to address other
issues than the two instances from which the applicant sought to draw
the inference of insolvency.
As already stated, the failure to pay
the debt to the applicant and the failure to proceed with another
transaction, do not allow
for the inference that the trust is
factually and commercially insolvent.
20. In the result the
applicant has failed to make out a case for the sequestration of the
trust.
21. Consequently, the
following order is made:
1. The application is
dismissed with costs.
______________________
C.P. RABIE
JUDGE OF THE HIGH COURT