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[2016] ZAGPPHC 407
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Standard Bank of South Africa v Abdoola t/a Merchant Media and Film (8802/2016) [2016] ZAGPPHC 407 (9 June 2016)
HIGH
COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
Case
no. 8802/16
9/6/2016
Not
reportable
Not
of interest to other judges
Revised
In
the matter between:
STANDARD
BANK OF SOUTH
AFRICA
Plaintiff
and
K.M.
ABDOOLA t/a MERCHANT MEDIA AND
FILM
Defendant
JUDGMENT
RABIE,
J
1.
Tthe plaintiff instituted action against the defendant for payment of
R 243 754, 37 plus interest and costs. The defendant entered
appearance to defend the plaintiffs action whereupon the plaintiff
applied for summary judgement. The defendant opposed the application
for summary judgement.
-2-
2.
The defendant raised a number of defences relating to, inter alia,
the authority of the deponent to the plaintiffs founding affidavit;
the question whether the summons were issued prematurely;
the adequacy of the allegations contained in the particulars
of
claim; and the allegation that the overdraft facility would not have
exceeded R50 000,00. I have considered all these defences
and came to
the conclusion that they are all without any substance. Due to my
finding in respect- of one other defence to which
I refer to below,
it is not necessary to refer further to the aforesaid defences.
3.
The defence I need to refer to relates to the question whether the
plaintiff was entitled, in terms of the agreement between
the
parties, to institute action in the circumstances that prevailed.
The salient background facts are as follows.
4.
The agreement between the parties which governed their relationship
was a Business Current Account which the defendant opened
with the
plaintiff on 23 February 2012. The defendant conducted this account
by way of withdrawing funds and depositing funds into
the account.
The defendant was entitled to overdraw the account but remained
obliged to repay the monies so lent and advanced to
it by the
plaintiff immediately upon demand.
5.
As at 11 January 2016 the defendant was indebted to the plaintiff in
the amount of R 243 754, 37 together with further interest
at the
rate of 16% per annum calculated daily and compounded monthly in
arrears as from 25 December 2015.
6.
The agreement between the parties and upon which the plaintiff relied
was attached to the particulars of claim. Paragraph 4 of
the
agreement deals with the issue of "default'. Paragraph 4.2
provides that if the defendant is in default, a
-3-
written notice of such
default may be given to the defendant. Paragraph 4.3 of the agreement
provides as follows:
"4.3 We may commence
with legal proceedings if we have given you notice as referred to in
clause 4.2 above and you have been
in default under this Agreement
for at least 20 (twenty) Business Days and at least 10 (ten) Business
Days have elapsed since we
delivered the notice contemplated in
clause 4.2 above and in the case of a notice,
you have not
responded to that notice or have respondent to the notice by
rejecting our Proposal.
" (My underlining)
7.
In the particulars of claim the plaintiff pleaded, and this was
common cause, that the agreement fell within the ambit of the
National Credit Act (''the Act"). The plaintiff pleaded that it
complied with the provisions of section 129 of the Act by
dispatching
the required notice to the defendant demanding payment of the
aforesaid amount within 10 days of date of posting of
the notice. It
was common cause that the notice was posted on 15 January 2016 and
that the defendant received the notice on 27
January 2016. The
summons were served on the defendant on 15 February 2016 and thus
after the expiry of the aforesaid 10 days.
8.
The defence of the defendant is based on her denial that she failed
to respond to the plaintiffs notice and or responded to the
notice by
rejecting any proposal. It is this issue which I have to decide.
9.
The response upon which the defendant relied was in the form of an
e-mail dated 29 January 2016, which was some two days after
receipt
of the section 129 notice. The e-mail was written by
the defendant's son on her behalf
and
-4-
addressed
to the attorneys of record of the plaintiff. Although all the aspects
mentioned in the letter are not relevant, it is
necessary to refer
thereto in full. It reads as follows:
"Dear Sir
I confirm that I
represent my 78-year-old mother Ms KB Abdoola and have been assisting
her due to her recent illnesses.
I also confirm that I
have received the letter dated 27/01/2016 and called you on
28/01/2016.
During this discussion, I
had advised you that my Mum, was extremely ill, and would have to be
hospitalised. I also proposed that
without going into the merits of
whether in fact my mother owes the bank this amount or not, my family
and I were willing to assist
our mother by paying the correct and
mutually agreed amount off in monthly instalments. I further advised
that the Bank had removed
several unauthorised withdrawals from my
mother's personal not linked to this account in question.
I had therefore requested
a detailed statement of account to date outlining all amounts that
the bank received, which will the assist
my family and Iin making an
offer to you in settlement.
We agreed that these
proposals will be agreed to with you client and we would be reverted
to.
You informed me that you
will revert to me via email as to whether your client will be
amenable to certain proposals.
I await your email so
that I can discuss it with my family.
E. Patel" (sic)
10.
the question to be answered is whether the aforesaid response by the
defendant was an adequate response as envisaged in
paragraph
4.3 of the agreement
-5-
mentioned
above which would have prevented the commencement of legal
proceedings. According to paragraph 4.3 legal proceedings may
be
commenced with if, in the first place, the defendant had not
responded to the notice. In casu the defendant had responded to
the
notice and consequently the second part of the provision needs to be
addressed. That is the part that states that legal proceedings
may be
commenced with if the defendant had responded to the notice but had
done so "by rejecting our proposal''. The question
is therefore,
firstly, whether the aforesaid e-mail on behalf of the defendant
constitutes a rejection of the plaintiff's proposal
and, secondly,
whether anything else should have delayed the commencement of
proceedings.
11.
In order to answer these questions, the section 129 notice of the
plaintiff has to be considered. In the third and fourth paragraphs
of
this notice the following is stated:
"Unless payment of
the outstanding amount of R 243 754, 37 is made within 10 business
days from date of delivery hereof, the
agreement will be cancelled
and the full amount owing will be·immediately due and payable.
The outstanding amount will further
incur interest which interest
shall be calculated monthly in arrears, as well as the monthly costs
associated with the account
from date of arrears to date of payment,
both days inclusive. Should you require any assistance to resolve the
arrears please contact
us on
[ telephone number ].
You may refer the
agreement to a debt counsellor (unless you are a juristic person).
alternative dispute resolution agent consumer
court or bank
ombudsman, with the intent that we should resolve any dispute under
the agreement or develop and agree to a plan
to bring the payments
under the agreement up-to-date. However, we should highlight the fact
that you will be unable to access further
credit whilst under debt
review and will be listed on the credit bureau."
-6-
12. The fourth paragraph
of the agreement (quoted above) to a large degree follows the wording
of the provisions of section 129
(1) (a) and section 130(1) of the
Act. Having regard to section 129 (1) (a) the invitation to the
defendant, as set out in the
notice, to refer the agreement to a debt
counsellor, alternative dispute resolution agent, consumer court or
ombud, clearly constitute
a "proposal" as envisaged in
paragraph 4.3 of the agreement and section 130 (1) (b) of the Act.
13.
On behalf of the plaintiff it was submitted that since the defendant
failed to refer the agreement to any of the above institutions,
the
defendant thus rejected the plaintiff's proposal and consequently the
plaintiff was entitled to commence legal proceedings.
14.
Although the defendant did not accept the proposal by referring the
matter to any of the institutions, the matter does not end
there.
Firstly, the section 129 notice itself, in the third paragraph,
invited the defendant to contact the plaintiff's attorneys
by
telephone should she require any assistance to resolve the arrears.
This was done on the day after receipt of the notice. According
to
the e-mail of the next day, 29 January 2016, the difficulties
experienced by the son of the defendant who was assisting her
were
discussed with the attorney and information was requested. Secondly,
and this appears from the last three paragraphs of the
e-mail, it was
agreed with the plaintiff's attorney that, at the very least, the
attorney or the plaintiff would revert to the
defendant or her son
regarding the matter and with a view of the defendant making an offer
in settlement of the account.
15.
According to the aforesaid e-mail, which was the only evidence in
this regard before this court, the defendant would clearly
have been
brought under the
-7-
impression that the
plaintiff would not proceed with legal proceedings unless and until
the plaintiff or its attorney had reverted
to the defendant or her
son. By the same token it would in the circumstances not have been
necessary for the defendant to accept
the formal proposal in the
notice namely of referring the agreement to any of the institutions
mentioned in the notice and the
Act. The defendant was clearly
entitled to wait for the response by or on behalf of the plaintiff
and could not have anticipated
service of the summons upon her prior
to such a response.
16.
In these circumstances I am of the view that I should exercise my
discretion against the granting of summary judgement against
the
defendant.
17.
As far as costs are concerned, the usual order for costs should be
made.
18.
In the result the following order is made:
1. Leave is granted to
the defendant to defend the action.
2. The costs of the
application shall be costs in the cause.
_______________________
C.P.
RABIE
JUDGE
OF THE HIGH COURT