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[2016] ZAGPPHC 594
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Standard Bank of South Africa v PAMSA Consulting (Pty) Ltd and Another (66611/2016) [2016] ZAGPPHC 594 (22 June 2016)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
CASE
NO: 66611/2016
DATE:
22 JUNE 2016
THE
STANDARD BANK OF SOUTH
AFRICA
...................................................
Plaintiff/
Applicant
And
PAMSAL
CONSULTING (PTY)
LTD
.......................................................
First
defendant/respondent
NTHUSHENG
PHASWANE MOTSHANA
.........................................
Second
defendant/respondent
REASONS
FOR JUDGMENT
AC
BASSON, J
[1]
This was an application for summary judgment in terms of
which the plaintiff/applicant sought an order to confirm the
cancellation
of the agreement between the plaintiff and the first and
second defendants/respondents and for the return of a 2015 Hino 300
714
LWB (“the vehicle”).
[2]
After having heard argument, this court granted summary
judgment against the defendants confirming the cancellation of the
agreement
and ordered the defendants to return the vehicle. The
defendants were also ordered to pay the costs.
Here are brief reasons for mv order
[3]
On 6 February 2015 the plaintiff and the first defendant
entered into an Instalment Sale Agreement (“the agreement”).
In terms of this agreement the defendant purchased a vehicle in an
amount of R 469 347.48 which amount was made up of a principal
debt
of R 360 750.81 plus finance charges of R 108 596.67. Further in
terms of this agreement, the first defendant undertook to
pay the
amount of R469 347.48 as follows: (i) Six fixed payments of R 16
281.63 each at one monthly intervals beginning on 15 March
2015; (ii)
53 payments of R 6 882.55 each at one monthly intervals beginning on
15 September 2015; and (iii) One final payment
of R 6 882.55 on the
15
th
of February 2020.
[4]
It is a term of the agreement that if a party fails to
make a payment, the plaintiff can claim the full outstanding balance
owing
in terms of the said agreement, alternatively, the plaintiff
may elect to cancel the agreement, take possession of the goods and
claim damages.
[5]
The first defendant did not make punctual payments. In
fact, as at 31 December 2015 the first defendant is in arrears in the
amount
of R 38 983.54. As will be pointed out herein below, instead
of raising a bona fide defence against their indebtedness towards the
plaintiff, the defendants have elected to raise technical defences in
their affidavit resisting summary judgment. I will revert
to the fact
that the defendants have not raised a bona fide defence herein below.
Section 129 notice in terms of the National Credit Act
[6]
The first defence raised is the allegation that the
section 129 notice as required by the National Credit Act
[1]
did not come to the knowledge of the defendants and therefore the
plaintiff was not entitled to issue and serve the summons. In
this
regard the defendants referred to the postage slips to make out an
argument that the said notice was sent to an incorrect
address.
[7]
At the outset I must point out that there is no merit in
this submission. Apart from the fact, as will be pointed out herein
below,
that a section 129 notice was not a requirement as the
National Credit Act does not apply to this particular agreement, I am
not
persuaded that the section 129 notice (even assuming that it was
a requirement) was sent to the incorrect address.
[8]
In respect of the section 129 notice, it appears from the
papers that the notice in terms of section 129 of the National Credit
Act was sent twice by registered post to the first respondent’s
chosen domicilium citandi et executandi. The registered posting
slips
reflect the correct address. From the Parcel Tracking Results
attached to the papers it further appears that the Post Office
did
indeed send a notification to the first defendant.
[9]
Is there an obligation on the plaintiff to ensure that
notice did actually come to the attention of the first defendant?
According
to the court in Kubyana v Standard Bank of South Africa
Ltd
[2]
.
No such obligation exists:
“[34]
I now consider the purpose of the s 129 notice and the obligations of
a reasonable consumer. Section 129 aims to establish
a framework
within which the parties to the credit agreement, in circumstances
where the consumer has defaulted on her obligations,
can come
together and resolve their dispute without expensive, acrimonious and
time-consuming recourse to the courts. However,
this form of dispute
resolution is possible only if both parties come to the table: the
credit provider must avoid hasty recourse
to litigation and the
consumer must seek to rectify her default in a reasonable and
responsible manner.
[35]
If the credit provider complies with the requirements set out
in [31] - [33] above and receives no response from the consumer
within
the period designated by the Act, I fail to see what more can
be expected of it. Certainly, the Act imposes no further hurdles and
the credit provider is entitled to enforce its rights under the
credit agreement. It deserves re-emphasis that the purpose of the
Act
is not only to protect consumers, but also to create a 'harmonised
system of debt restructuring, enforcement and judgment,
which places
priority on the eventual satisfaction of all responsible consumer
obligations under credit agreements'. Indeed, if
the consumer has
unreasonably failed to respond to the s 129 notice, she will have
eschewed reliance on the consensual dispute
resolution mechanisms
provided for by the Act. She will not subsequently be entitled to
disrupt enforcement proceedings by claiming
that the credit provider
has failed to discharge its statutory notice obligations.
[36]
As set out earlier, even if the s 129 notice has been
dispatched by registered mail and the Post Office has delivered the
notification
to the consumer's designated address, valid delivery
will not take place if the notice would nevertheless not have come to
the
attention of a reasonable consumer. But if the credit provider
has complied with the requirements set out above, it will be up to
the consumer to show that the notice did not come to her attention
and the reasons why it did not”
[10]
The deponent to the affidavit resisting summary judgment
merely states that he did not receive the notices from the Post
Office.
I am not persuaded on the papers that the notice was sent to
an incorrect address and therefore do not accept the bold allegation
that the notice did not came to the attention of the defendant.
Does the National Credit Act apply?
[11]
I have already referred to the fact that the point has
been raised that the National Credit Act is, in any event, not
applicable
to the agreement.
[12]
In the present matter the first defendant is identified as
a closed corporation duly registered in terms of the Company Laws of
the Republic of South Africa.
[13]
In general, the National Credit Act does apply to juristic
persons in their capacity as consumers but only to a very limited
extent.
More in particular, the National Credit Act does not apply if
the juristic person concludes a "large agreement”. A
“large
agreement” refers to a mortgage agreement
(regardless of the amount involved) and also refers to other credit
agreements
in terms of which the principal debt is R250 000 or more.
The National Credit Act does not apply to a juristic person with an
asset
value or annual turnover of R1 million or more. The National
Credit Act will also not apply if a juristic person - with an asset
value or annual turnover below R1 million when the agreement is made
- concludes a large credit agreement (see s 4(1 )(b) of the
NCA).
(See also Nedbank Ltd v Wizard Holdings (Pty) Ltd and Others.
[3]
)
[14]
In the present case this court is unaware of whether the
first defendant has an assent value or annual turnover of R 1 million
or
more. But, on the facts before the court, the agreement in the
present instance qualifies as a large agreement” in light of
the fact that it is a credit agreement in terms of which the
principle debt is more than R 250 000.00: In terms of s 4(1)(b) of
the National Credit Act, the Act does not apply to a credit agreement
where the agreement qualifies as a large agreement as envisaged
in s
9(4)(b) read with s 7(1 )(b) of the National Credit Act (namely where
the “principal debt” under the transaction
equals or
exceeds the amount of R250 000, as determined in GN 713 of 1 June
2006).
[15]
In light of the fact that the defendants (assuming that
the first defendant/respondent has an assent value or annual turnover
of
less than R 1 million) have concluded a large credit agreement,
the provisions of the National Credit Act are not applicable to
the
transaction. The plaintiff was therefore not required to dispatch a
section 129 notice to the defendants. Consequently the
defence raised
by the defendants in respect of the section 129 notice is rendered
academic.
Bona fide defence
[16]
Apart from the aforegoing, and more importantly, no
defence is put forward in the affidavit resisting summary judgment.
Where a
defendant fails to set out a bona fide defence in its papers,
an application for summary judgment will be granted. See in this
regard ABSA Bank Limited v EFM Investments CC
[4]
where the Court emphasised this point:
“[2]
I do not propose to go back over the reasons why summary judgment was
granted against the defendants anymore than is
strictly necessary.
Those reasons were fully set out in the principal judgment. The
essential reason why the defendants’
opposition to the
application for summary judgment was unsuccessful was that they
failed, in my judgment, to meet the threshold
requirement of setting
out a bona fide defence. The classical statement of the requirements
in this respect is that given in Maharaj
v Barclays National Bank Ltd
1976 (1) SA 418
(A), at 425G-426E. The remedy of summary judgment is
not intended to shut out defendants who are able to demonstrate a
bona fide
intention to defend the action. It does require them,
however to show what their intended defences are. It must appear from
what
they say in this respect that the defences are legally
sustainable and that they are maintained in good faith. They are
expected
to do this by setting out in their opposing affidavits the
nature and grounds of the defence and the material facts upon which
it is founded. If the averments made by a defendant in the opposing
affidavit are vague, or markedly lacking in the particularity
that
might be expected in the circumstances of the case, then the court is
likely to hold that a bona fide defence has not been
disclosed, and
summary judgment will follow ”
[17]
Nowhere in the affidavit resitting summary judgment does
the defendants disclose, apart from technical defences, what their
defence
is against the averment made on behalf of the plaintiff that
the first defendant had breached the agreement by not making punctual
payments. More in particular, there is no denial in the affidavit
resisting summary judgment that the first defendant is in arrears
in
the amount of R 38 983.54. In fact, there is not even an averment
that the first defendant/respondent has in fact been making
payments
towards the vehicle.
[18]
I am therefore in agreement with the submission on behalf
of plaintiff that the defendants have entered an appearance to defend
merely in order to delay the plaintiffs claim. If the defendants had
made any payments to the plaintiff since 31 December 2015 it
would
have been expected of them to have attached, at the very least, proof
of payment to the plaintiff (since December 2015).
In the
circumstances it is therefore concluded that the defendants have not
disclosed a bona fide defence in their papers. Furthermore,
the
irresistible conclusion on the papers is that the defendants do not
have a defence, that the first defendant is currently utilising
a
vehicle for which no payments have been made, and that the defendant
have merely entered an appearance to defend in order to
delay the
plaintiffs claim.
[19]
I am therefore of the view that it would be appropriate to
exercise my discretion in favour of the plaintiff especially in light
of the facts deposed to in the affidavit opposing summary judgment
that do not suggest a reasonable possibility that the defendants
may
have a defence against the monetary claim of the plaintiff.
[20]
In the event the application for summary judgment is granted
with costs.
AC
BASSON
JUDGE
OF THE HIGH COURT
[1]
Act 34 of 2005.
[2]
2014 (3) SA 56 (CC).
[3]
2010 (5) SA 523 (GSJ.
[4]
Case No.s: 11461/2012 and 11463/2012. 26
October 2012. Western Cape High Court.