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[2016] ZAGPPHC 713
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Endeto Engineering CC v Bezuidenhout and Another (59474/2016) [2016] ZAGPPHC 713 (17 August 2016)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE
NO.: 59474/2016
17/8/2016
Reportable:
No
Of
interest to other judges: No
Revised.
In
the matter between:
ENDETO
ENGINEERING
CC First
applicant
and
JULIANA
BEZUIDENHOUT First
respondent
KEGO
MINING (PTY)
LTD Second
respondent
WYNAND
PRINSLOO VAN EEDEN
ATTORNEYS Third
respondent
REGISTRAR
OF DEEDS,
NELSPRUIT Fourth
respondent
JUDGMENT
VAN
DER WESTHUIZEN, A J
1.
This application comes before me by way of urgency.
2.
The applicant seeks, pending the final determination of the action
instituted by the applicant against the first respondent under
case
number 95918/2015, an order in terms whereof a portion of the
proceeds derived from the sale of immovable property be paid
into an
interesting bearing account. The amount sought to be preserved is
R595 155.19.
3.
The aforesaid proceeds of the sale of immovable property arise from
the sale of the first respondent's immovable property to
the second
respondent. The proceeds are to be paid into the trust account of the
third respondent by the second respondent or for
the benefit of the
second respondent.
4.
The proceedings referred to above relate to the recoupment of monies
owed to the applicant by a Close Corporation for which the
first
respondent has bound herself as co-principal debtor and surety for
the obligations of the Close Corporation. The latter is
under
winding-up proceedings. The first respondent has in terms of the
provisions of the suretyship, renounced the benefits of
legal
exceptions, excussion and division, cession of action and no value
received.
5.
The applicant instituted the aforesaid proceedings by way of action
during November 2015.
6.
In response to the aforesaid proceedings, the first respondent filed
an intention to defend the action and during March 2016
filed a
concise plea. In the plea the first respondent admits the suretyship
and the terms thereof. However, in respect of the
balance of the
allegations, and in particular that relating to the indebtedness of
the principal debtor in favour of the applicant,
the first respondent
denies those allegations and puts the applicant (as plaintiff) to the
proof thereof.
7.
On 28 April 2016 the applicant's attorneys served a notice in terms
of the provisions of Rule 37 of the Uniform Rules of Court
inviting
the first respondent to attend a pre-trial conference. There was no
response to that notice. On 10 June 2016 a letter
was addressed to
the first respondent's attorneys determining 14 June 2016 to be the
date for the pre-trial. The first respondent's
attorneys responded to
that letter on 10 June 2016 advising that the date of 14 June 2016
was not suitable and a request was made
for alternative dates. In a
letter dated 13 June 2016 alternative dates for the pre-trial were
proposed. No response to that letter
was received from the first
respondent's attorneys and no response to a follow up letter of 21
June 2016 was received.
8.
During July 2016 it came to the applicant's knowledge that the first
respondent had sold her three immovable properties to the
second
respondent. The circumstances under which the sale took place are
unknown to the applicant. The purchase price thereof is
also unknown
to the applicant.
9.
In a letter dated 18 July 2016, the applicant's attorneys sought an
unconditional undertaking by the first respondent not to
give
transfer of the said properties until the litigation between the
parties is finalised or settled.
10.
The first respondent was further advised in the letter of 18 July
2016 that the only reasonable inference to be drawn from the
terse
plea, the unwillingness to attend a pre-trial conference and the
unwillingness to provide an undertaking in respect of the
sale of the
aforesaid properties, was that the first respondent was delaying the
inevitable in order to transfer all the first
respondent's properties
to the applicant's prejudice. A further unconditional undertaking,
similar to the previous undertaking
sought, was requested in respect
of the transfer of the said properties. Again no response to the
letter of 18 July 2016 was received.
11.
On 20 July 2016 the applicant caused a further letter to be addressed
to the first respondent through her attorneys. It was
recorded in
that letter that apparently clearance figures were requested in
respect of the said properties, which were to be valid
until 31
August 2016. It was further requested that an undertaking be provided
as previously requested.
12.
It was further recorded in the letter of 20 July 2016 that the first
respondent had on a previous occasion confirmed that the
only assets
she had were the three properties referred to.
13.
It comes as no surprise that no response was received in respect of
the letter of 20 July 2016. The applicant was advised to
bring the
present application.
14.
The present application was launched on 27 July 2016 and served on
the first respondent on 29 July 2016, an attempt to serve
on 28 July
2016 being unsuccessful.
15.
The first respondent was afforded the opportunity to file an
intention to oppose this application by 1 August 2016 and to file
an
answering affidavit by 8 August 2016. No intention to oppose was
served and no answering affidavit was served.
16.
On 15 August 2016, the day before this application was to be heard, a
notice in terms of Rule 6(5)(d)(iii) was served upon the
applicant's
attorneys. The said notice indicated that only "questions of
law" would be argued at the hearing of this
matter.
17.
Rule 6(5)(d)(iii) prescribes that in the event of a notice in terms
of those provisions being filed, such is to be file within
the time
which is indicated for the filing of an answering affidavit. No
explanation was provided why that notice could not have
been filed by
8 August 2016.
18.
A number of
points are raised in the Rule 6(5)(d)(iii) notice, the majority of
which are not points of law, but require factual
allegations to
support such. However, the point of law that is raised is premised
upon the decisions in
Carmel
Trading
Co
Ltd v
Commissioner SARS
[1]
and
Knox
D'Arcy v Jamieson.
[2]
19.
Counsel for the first respondent submitted that the applicant has not
complied with the principles enunciated in the aforementioned
decisions. He submitted further that no facts have been alleged that
satisfy the requirements laid down in those judgments. It
was
submitted that only supposition and groundless inferences are to be
found in the founding affidavit.
20.
In
particular, it is submitted that the applicant has not alleged that
the first respondent is "wasting or secreting assets
with the
intention of defeating the claims of creditors".
[3]
21.
It is
further submitted on behalf of the first respondent that the
applicant has no claim against the assets in question and that
the
interdict sought is merely to prevent the first respondent from
freely dealing with her own property to which the applicant
lays no
claim. In this regard, counsel for the first respondent relies upon a
passage appearing in
Knox
D'Arcy, supra.
[4]
The
context in which that passage appears is as follows:
''As
to the nature of
the interdict, this was dealt with by Stegmann J in 1994 (3)
SA
at 70687078 and in 1995 (2)
SA
at 591A600F. The latter
passage was largely devoted to showing that it is not necessary for
an applicant to show that the respondent
has no bona fide defence to
the action. This conclusion was not attacked before us and I agree
with it.
What then must an
applicant show in this regard? In the passages mentioned above,
Stegmann J quoted the relevant
cases in our law and I do not
propose dealing with all of them. For the
most
part they were
decided on their own
facts
without providing any theoretical
justification for the interdict. However, in Mcitiki and Another v
Maweni
1913 CPD 684
at 687 Hopley J stated the effect of earlier
cases as
follows:
'. . .
(T)hey all
proceed upon the wish of the Court that the plaintiff should not have
an injustice done to him by reason of leaving his
debtor
possessed
of funds sufficient to
satisfy
the claim, when
circumstances show that such debtor
is
wasting or getting rid
of such funds to defeat his creditors, or is
likely to do
so.'
See also
Bricktec
(Pfy) Ltd v Pantland
1977 (2) SA 489
(T) at 493EG.
The question which
arises
from this approach is
whether an
applicant
need show a particular
state
of mind on the part of the
respondent, ie that he is getting rid of the funds, or is likely to
do so,
with the intention of defeating the claims of
creditors. Having regard to the purpose of this type of interdict,
the answer must
be, I consider,
yes,
except possibly in
exceptional cases
. As
I have said, the effect of the interdict
is
to prevent the respondent from freely dealing with his own
property to which the applicant lays no claim. Justice may require
this
restriction in
cases
where the respondent
is
shown
to be acting
ma/a
fide with the intent of preventing execution
in respect of the applicant's claim. However, there would not
normally be any justification
to compel a respondent to regulate his
bona fide expenditure so as
to retain funds in his patrimony
for the payment of claims (particularly disputed ones) against him. I
am
not, of course, at the moment dealing with special
situations which I might
arise,
for instance, by contract or
under the law of insolvency."
22.
From the aforementioned quotation, all that is required of an
applicant is to show
circumstances that such debtor
is
wasting
or getting rid of such funds to defeat his creditors, or is likely to
do so
or put otherwise,
need to show
a
particular state
of mind on the part of the respondent, i.e. that she is getting rid
of the funds, or is likely to do so, with the
intention of defeating
the claims of creditors.
23.
In respect
of the degree of proof required, the following was said in
Knox
D'Arcy, supra,
[5]
"There was some
argument on whether the fact that assets were secreted with the
intent to thwart the petitioners' claim had
to be proved on
a
balance of probabilities or merely prima facie. However, it seems
to me that here also the relative strength or weakness of the
petitioners' proof would be
a
factor to be taken
into
account and weighed against other features in deciding whether an
interim interdict should be granted".
24.
Counsel for the first respondent, after completing his argument,
submitted that in the event the point of law that is raised
is not
upheld, the first respondent should be afforded an opportunity to
file an answering affidavit on the merits. That submission
was not
pressed. As referred to earlier, no explanation was provided for the
failure to file an answering affidavit or for the
late filing of the
Rule 6(5)(d)(iii) notice.
25.
In
Boxer
Superstores Mthatha et al v Mbenya
[6]
it was
held that where the respondent relies exclusively on the Rule
6(5)(d)(iii) notice, the allegations in the founding affidavit
must
be taken as established facts.
26.
In this regard the following is important:
(a) The first respondent
has indicated that the said three properties are her only assets;
(b) The statement that
the only reasonable inference to be drawn from the terse plea, the
unwillingness to attend a pre-trial conference
and the unwillingness
to provide an undertaking in respect of the sale of the aforesaid
properties, was that the first respondent
was delaying the inevitable
in order to transfer all the properties to the applicant's prejudice
is uncontroverted;
(c) The unwillingness on
the part of the first respondent to provide an undertaking as
requested.
27.
In my view the foregoing issues constitute circumstances that the
first respondent is wasting or getting rid of such funds to
defeat
her creditors, or is likely to do so. Furthermore, the foregoing
shows a particular state of mind on the part of the first
respondent,
i.e. that she is getting rid of the assets, or is likely to do so,
with the intention of defeating the claims of the
applicant. In my
view, the lack of response to the statements contained in the letters
clearly supports a finding that the first
respondent in dealing
freely with her assets has no intention to satisfy the applicant's
claim.
28.
It is further submitted on behalf of the first respondent that the
interdict sought would have a "devastating effect on
the affairs
of the first respondent", constitutes an abuse of process and is
intrusive of the rights of the first respondent
from freely dealing
with her own property.
29.
No facts have been placed before me to substantiate any of the
foregoing submissions. They are mere supposition on the part
of the
first respondent. The first respondent had amply opportunity to deal
with the allegations referred to earlier, but declined
to do so.
30.
It follows that the application must succeed.
I
grant the following order:
(a) Pending the final
determination of the action instituted by the applicant against the
first respondent under case number 95918/2015:
(1) The third respondent
is directed to retain the sum of R595 155.19 (Five hundred and ninety
five thousand one hundred and fifty
five rand and nineteen cents),
and an additional amount of R100 000.00 (one hundred thousand rand)
form the funds to be paid into
its trust account by the second
respondent, or for the benefit of the second respondent,
in lieu
of the purchase price to be paid by the second respondent to the
first respondent in respect of the sale of holdings 15, 16 and 17
of
Kendal Forest Holdings, held by Deeds of Transfer T48185/1991,
T9392/2015, T9601/2010, by the first respondent to the second
respondent;
(2) That aforesaid
amounts are to be retained in an interest bearing account, opened in
terms of section 78(2) of the Attorneys
Act, 53 of 1979;
(b) The first respondent
is to pay the costs of this application.
________________________
C
J VAN DER WESTHUIZEN
ACTING
JUDGE OF THE HIGH COURT
GAUTENG
DIVISION
On
behalf of Applicant:
D Prinsloo
Instructed
by:
Krugel Heinsen Inc
On
behalf of Respondents:
HC Janse van Rensburg
Instructed
by:
S C Vercueil Prokureurs
[1]
2008(2) SA 433 (SCA)
[2]
1996(4) SA 348 (A)
[3]
Carmel Trading, supra, at 435D
[4]
at 372G
[5]
at 373G-H
[6]
2007(5) SA 450 (SCA) at 452F-G