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[2016] ZAGPPHC 430
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Nedbank Limited v Principle Education and Marketing CC and Another (11810/2016) [2016] ZAGPPHC 430 (13 June 2016)
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IN THE HIGH COURT OF
SOUTH AFRICA
(GAUTENG DIVISION,
PRETORIA)
REPUBLIC
OF SOUTH AFRICA
Date
of hearing: 21 April 2016
Case
number: 11810/2016
13/6/2016
Reportable:
No
Of
interest to other judges: No
Revised.
In
the matter between:
NEDBANK
LIMITED TRADING AS
MFC Applicant/Plaintiff
and
PRINCIPLE
EDUCATION AND MARKETING CC First
Respondent/Defendant
TOERIEN,
TREVOR
KEITH Second
Defendant
JUDGMENT
BRENNER
AJ
1.
On 15 December 2011, the applicant/plaintiff, Nedbank Limited
('Nedbank"), sold a seven seater Hyundai Sante Fe motor vehicle
('the vehicle") to the first respondent/defendant, Principle
Education and Marketing CC ("the corporation"), in
terms of
an instalment sale agreement ("the agreement"). The
agreement was subject to the National Credit Act, 34 of
2005 ("the
NCA").
2.
The aggregate price of the vehicle, including finance and other
charges, was R597 001,21, and was repayable by way of 71 monthly
instalments of RS 583,77, commencing on 1 February 2012, and a final
instalment in the sum of R129 553,54. In terms of the agreement,
ownership remained vested in Nedbank until all payments had been
made. Moreover, if the corporation defaulted on its obligations,
Nedbank was entitled to cancel the agreement and claim repossession
of the vehicle and to claim as forfeited the payment of all
prior
instalments.
3.
On 17 December 2011, the second defendant, Trevor Keith Toerien
("Toerien"), stood surety for the liability of the
corporation in an amount not exceeding R402 027,99.
4.
According to the Summons, the corporation was in arrears as at 20
November 2015, in the sum of R26 797, 17, with the balance
of the
debt being R322 340,98. Following the service by registered post of a
notice under section 129(1)(a) of the NCA, the agreement
was
cancelled by notice given on 8 January 2016.
5.
On 15 February 2016, Summons was issued in an action against the
corporation and Toerien for the return of the vehicle and ancillary
relief. On 10 March 2016, Toerien, acting for the corporation and
himself, signed a document entitled "Response to Combined
Summons - Acceptance". This document was filed on 11 March 2016.
While the document does not reflect that it is a notice of
intention
to defend, in substance, and on a proper perusal thereof, it
appears to intimate as much.
6.
An application for summary judgment was served on 30 March 2016, on
the corporation, by the sheriff of this Court. This resulted
in the
service by the defendants of a "Notice of Non-Response and
Dishonour" dated 30 March 2016. The relief sought by
Nedbank is
confined to its claims against the corporation, qua principal debtor.
Nevertheless, Toerien chose to associate himself
with the corporation
in the various allegations made in the papers before Court, and
therefore, for convenience, I have referred
to both parties
collectively as "the defendants".
7.
Both of the aforementioned documents were signed before one Karla
Strydom, who describes herself as an "ex officio practising
attorney", and a Notary Public and Commissioner of Oaths. The
notice replying to the summary judgment application does not
contain
the prescribed oath nor does it conform with the requirements of an
affidavit.
8.
On 19 April 2016, shortly before the hearing of the application, a
further document styled "Claim in Reconvention"
was served.
It merits mention that the purported "counterclaim" relates
to nothing more than a demand for the discovery
of additional
documents by Nedbank.
9.
On 21 April 2016, Toerien appeared before Court to oppose the
application on behalf of the corporation. He confirmed that the
defence to the claims of Nedbank was contained in the above
documents.
10.
In limine, Toerien asserted that the provisions of Rule 7 of the
Uniform Rules should be invoked against the attorneys for Nedbank,
to
prove their authority to act for it, and he also called for an order
to compel Nedbank to produce a detailed list of documents
which he
considered to be relevant to the claim. These documents were
identified in his "Claim in Reconvention."
11.
I resolved that, for purposes of argument, I would subordinate form
to substance and have regard to the contents of the above
documents
in determining whether a bona fide defence had been raised by the
corporation. This primarily because it was patent to
me that the
defendants were genuine in their intention to defend the action. In
resolving to do so, I was mindful of the fact that
the corporation
was not legally represented and that a modicum of latitude should be
extended to it in regard to its failure to
adhere strictly to the
formal requirements of Rule 32 of the Uniform Rules of Court. At the
same time, I remained cognisant of
the duty to satisfy the Court that
it had a bona fide defence on the merits.
12.
At the hearing, Nedbank's Counsel indicated that Nedbank had chosen
to confine its claim to the repossession of the vehicle,
and
forfeiture of monies paid, and that the claim for summary judgment
was solely against the corporation.
13.
After hearing argument for both parties, I gave an order against the
corporation for the repossession of the vehicle, forfeiture
of monies
paid, and costs on the attorney and client scale. In due course,
following the appraisal of the market value of the vehicle,
Nedbank
will be in a position to quantify the extent of its damages, if any,
and, if warranted, to take further steps for the recovery
of any
damages incurred. What appears below are the reasons for my judgment.
14.
Rule 32(3)(b) of the Uniform Rules obliges a respondent in summary
judgment proceedings to adduce a bona fide defence to the
action by
way of an affidavit which discloses
"fully the nature and
grounds of the defence and the material facts relied upon therefor."
15.
At page 81-223 of Erasmus, Superior Court Practice, the author
states:
"If, however, the
defence is averred in
a
manner which appears in al/ the
circumstances to be needlessly bald, vague or sketchy, that will
constitute material for the court
to consider in relation to the
requirement of bona fides.
•
16.
This much was stated in the case of
Breitenbach v Fiat SA (Edms)
Bpk
1976 (2) SA 226
(T).
At p228 the Court held as follows:
"It must be
accepted that the subrule was not intended to demand the impossible.
It cannot, therefore, be given its literal
meaning when it requires
the defendant to satisfy the Court of the bona fides of his defence.
It wil/ suffice . .....if the defendant
swears to
a
defence,
valid in law, in
a
manner which
is
not inherently and
seriously unconvincing."
17.
The contents of the documents produced by the corporation and Toerien
are long on submission and short on fact. For the most
part, they are
incoherent and irrelevant. This does not necessarily mean that they
lack points of substance, the Court being duty
bound, under the given
circumstances, to separate the wheat from the chaff in determining
whether a bona fide defence has been
advanced.
18.
On a conspectus of the three documents produced by the defendants,
only one potential defence emerges. This is that, when the
agreement
was executed, the corporation had offered up a promissory note to
Nedbank in settlement of the full debt at some stage
in the future,
and that this note was "monetised" by Nedbank and
therefore, the debt was discharged in this manner. It
is argued that,
in the result, the Bills of Exchange Act 34 of 1964 applies.
19.
I quote from the only document which comprehensively addresses the
claims in casu, namely, the "Response to Combined Summons
–
Acceptance":
"There
is no dispute with any of the facts in the instant matter. When I
signed the (Note), I signed
a
promissory note that
payment will be made at some time in the future. The Bank took my
note and monetised it. However, the note
has not been redeemed by the
labour of the Defendant who made the note. So whatever numbers the
bank put on its books was simply
money of account. In other words its
bookkeeping entries. So it is the responsibility as the purchaser of
the car to redeem that
note, but what the bank did is redeem the
title of the car, so that the defendant can take possession of the
car and this was all
done with money of account. Then the bank has
the audacity to come to the maker of the note (the defendant) and say
that the bank
wants the defendant to redeem all of this money of
account (bookkeeping ledge entries) with money of exchange (reserve
bank notes
or cash) THAT IS FRAUD. The bank has leveraged the whole
process in such a manner that they create interest.
So the facts of this
case and all charges, offers, dishonours are accepted for value and
returned in exchange for fair settlement
and closure, by exercising
the rights as provided for in the Bills of Exchange act, act 34 of
1964 as amended by act 56 of 2000.
Accepting the full amount
allegedly outstanding, due, owed and payable specifically in terms of
section
9
of act 56 of 2000, which substituted section 25 of
the principal act: Holder for value "A holder takes a bill for
value if
he takes it under onerous title."
20.
Attached to this document is the defendants' version of the
agreement, on the face of which the following note is stamped in
blue
ink print, diagonally
across
the entire document:
"Accepted
for Value
And
Returned for Fair
Settlement
Apply the Bills of
Exchange Act
Act 34 of 1964
as
amended by
Act 5 of 2000."
21.
Ex facie the document, the signature and
identity number of Toerien appears, with
the date noted
as 8 March 2016.
22.
In reply to the summary judgment
application, in the document styled "Notice
of Non Response and Dishonour", the following allegation is
made:
"On the 11th day of
March 2016 the Affiant (sic) delivered to the Respondent VHI
Attorneys by hand an Accepted, Endorsed and
Taken for Value
Negotiable Instrument for Set -Off together with
a
Cover Letter."
23.
The dispute, raised at the hearing of the application, concerning the
authority of VHI attorneys to act for Nedbank was, with
respect, an
expedient and disingenuous afterthought. This denial is belied by
the affidavit deposed to by Nicolean Ferreira,
the Manager,
Specialised Support and Litigation at MFC, a division of Nedbank, in
support of summary judgment, who confirmed having
examined all
information and records of relevance to the case and who, by
necessary implication, confirmed the
authority
of VHI Attorneys to act for Nedbank.
24.
The counterclaim to compel the production of further documents did
nothing to advance any defence on the merits. In any event,
all
documents germane to the claim were already annexed to Nedbank's
Summons. Had Nedbank omitted to attach a material document,
there may
have been justification for a request for further discovery, but this
was not the case, and no prejudice was caused to
the corporation. The
copy of the agreement produced by Nedbank and attached to its Summons
bore no alterations or variations along
the lines averred by it.
25.
It is plain from the "Response to Combined Summons" that
the corporation admits the liability but avers that payment
of same
was tendered by way of the promissory note. A copy of the alleged
promissory note which, according to the defendants, was
given at the
time that the agreement was signed, was not produced, nor was any
detail given of its nature.
26.
There is a total paucity of detail given on a matter peculiarly
within the knowledge of the corporation. There is no suggestion
made
that it was redeemable when the full debt became due or instead,
redeemable in instalments as and when same were due. In the
absence
hereof, it would not have constituted a proper tender of payment in
settlement of the debt as it arose.
27.
Shortly before the hearing of this application, the defendants
attempted to hand over a copy of the agreement itself to Nedbank's
attorneys and to proffer this as a further "negotiable
instrument". In doing so, they appear to have been "pleading
over" in the sense that, should the Court find that the
promissory note was not given, then Nedbank was instead obliged to
accept the agreement in lieu thereof. This serves to water down the
probative value, if any, of the assertion that a promissory
note was
given in the first place. This aside, not by any stretch of the
imagination can the agreement itself be construed as a
negotiable
instrument. It is nothing more nor less than objective documentary
evidence of the debt owed by the corporation to Nedbank.
28.
In any event, the agreement expressly provides that payment is
required to be made by direct transfer into Nedbank's nominated
bank
account, free from deduction. The agreement also contains a clause
which prohibits any variation unless same has been reduced
to writing
and signed by both parties.
29.
Reference to the application of the Bills of Exchange Act to the
issues in casu is a nonsensical red herring.
30.
Finally, there is no suggestion on the papers that the corporation is
not in arrears with the instalments, nor that there was
non-compliance with the NCA, nor that the agreement was not validly
cancelled, nor, on any other conceivable basis, that there
are no
legal grounds for the claims made. The corporation's general denial
of liability on the basis of the above assertions is
wholly
unsatisfactory, cannot be justified on any logical basis, and is
inherently unconvincing.
31.
Due cognisance has been taken of the fact that the corporation was
not legally represented in these proceedings. A measure of
leniency
was afforded to it regarding the form in which it raised what it
understood to be a defence. At all times, however, I
remained obliged
to establish, in terms of Rule 32, whether a credible, bona fide
defence was advanced. For the reasons adumbrated
above, no
sustainable defence was adduced by the corporation, in particular, to
Nedbank's claims against it. With no suggestion
that there was no
choice on the subject, Toerien, acting for the corporation, elected
of his own accord not to secure legal representation,
this in the
face of a High Gour! action which, of necessity, entailed an
appreciation of, and respect for, the Rules of Court.
It is the
corporation, and not Nedbank, which must bear the consequences of
this decision.
32.
I refer in this regard to the case of
Magistrate M Pangarker v
Arnold Botha and Christina Botha 2014 ZASCA. SCA 78
at paragraph
34:
"The right to
legal representation is a corollary of the right of access to
justice. The denial of this right has wide-ranging
consequences for
the nature and experience of justice. Nevertheless, a litigant may
not benefit from his own misconduct or otherwise
careless approach to
legal proceedings."
33. For the reasons
advanced above, I confirm having made the following order on 21 April
2016.
34.
Summary judgment is granted against the first defendant as follows:
a. Confirmation of
cancellation of the credit agreement attached to the ·
particulars of claim as annexure "A";
b. The first defendant is
ordered to forthwith return to the plaintiff the following asset and
to hand it over to the plaintiff
and/or the Sheriff:
1 x HYUNDAI SANTE FE R
2.2 CRD I GLS A/T 7 SEAT 2012 MODEL ENGINE NO [...]
CHASSIS NO:
KMH[...]8519
c. The Sheriff of the
High Court is authorised and requested to attach, seize and hand over
to the plaintiff, wherever it may be
found:
1 x HYUNDAI SANTE FE R
2.2 CRD I GLS A/T 7 SEAT 2012 MODEL ENGINE NO [...]
CHASSIS NO:
KMH[...]B519
d. Forfeiture of all
monies paid by the first defendant to the plaintiff in terms of the
agreement annexed to the plaintiff's particulars
of claim as annexure
"A";
e. Costs of suit on the
scale as between attorney and client;
f. The postponement of
prayer 6 of the particulars of claim, sine die.
_____________________
T
BRENNER
ACTING
JUDGE OF THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
6
June 2016
Appearances
Counsel
for Applicant/Plaintiff:
Adv J P van den Berg
Instructed
by:
VHI Attorneys
For
the Respondents/Defendants:
Mr T K Toerien
Instructed
by:
No legal representation