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[2016] ZAGPPHC 897
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Naidoo and Another v Ferreiras (Pty) Limited (69094/2014) [2016] ZAGPPHC 897 (9 September 2016)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA,
NORTH
GAUTENG DIVISION, PRETORIA
9/9/16
CASE
NO: 69094/2014
Reportable:
No
Of
interest to other judges: No
Revised.
In
the matter between:
NAIDOO,
VISHNU
KISTENSAMY
First
Applicant
REGO,
SAMUEL JORGE DA
SLVA
Second
Applicant
and
FERREIRAS
(PTY)
LIMINTED
Respondent
JUDGMENT
MSIMEKI
J,
INTRODUCTION
[1]
This is an interlocutory application in which the two applicants seek
an order as follows:
"1. Compelling the
Respondent/Applicant's compliance with the first
and second
Respondents' Notice in terms of Rule 35(12) and Rule 35(14).
2.
In the alternative
to prayer 1 above, an order striking out the Respondent/Applicant's
Notice of Motion.
3.
Ordering the
Respondent/Applicant to pay the costs of this application.
4.
Further and/or
alternative relief'.
BRIEF
BACKGROUND FACTS
[2]
The respondent, applicant in the main application, under the same,
case number, brought an application against the respondents,
applicants in the interlocutory application, on 29 September 2013,
seeking an order for payment to it by the respondent of an amount
of
R989 000.00; interest thereon at the rate of 15% per annum, a
tempora
morae
to date of final payment and costs. Following the launching
of the main application, the respondents delivered a Notice in terms
of
Rule 35(12) and (14) of the Uniform Rules of Court,
requesting
the applicant to furnish them with certain documents referred to
therein. The respondent responded to the Notice but
the response was
regarded by the respondents as inadequate. The inadequacy, according
to them, resulted in this interlocutory application.
The respondents,
originally required the applicant to furnish 26 documents. The
request for 20 documents was abandoned by the respondents
who still
required the remaining 6 documents. This application, therefore, is
brought in terms of
Rule 30A (2) of the Uniform Rules of Court.
The application is opposed.
[3]
For the sake of convenience, I shall refer to the parties as they are
referred to in the interlocutory application.
[4]
Advocate W. Pye (Mr Pye) and Advocate H P Van Niewenhuizen (Mr Van
Niewenhuizen), respectively, represented the respondent and
the
applicants when the matter was argued.
[5]
The applicants were directors of the respondent but resigned as
directors on 18 and 20 December 2013. The respondent alleges
that
notwithstanding the resignations, the applicants accessed, the
respondent's bank account and paid themselves an amount of
R989
000.00. This, according to the respondent, amounts to theft.
[6]
The applicants, according to them, brought this application needing
the remaining requested documents in order to access information
therefrom to enable them to prepare their answering affidavits in the
main application.
[7]
The respondent contends that the request for documents under
Rule
35 (12) and (14)
is merely a delaying tactic as the applicants,
according to it, need only deny stealing the money or justify the
payment to themselves.
The applicants, in any event, according to the
respondent, do not need any documents in order to answer the
respondent's claim
against them.
[8]
The respondent further contends that there is no justification for
the applicants' invocation of
Rule 35 (12) and (14).
The rule,
according to the respondent, does not assist the applicants who,
legally, cannot invoke its application.
[9]
The applicants delivered their first heads of argument on 28 May
2015. These heads of argument were replaced with supplementary
heads
of argument which were delivered on 6 October 2015.
[10]
In paragraph 14 of the supplementary heads of argument the following
is said:
"AD RULE 35(12)
14 This point is conceded and the
Compel/ants (applicants) do not persist in terms of Rule 35(12)"
.
Due
to the concession, the rule warrants no further attention.
[11]
Still to receive attention, remains
Rule 35(14).
The
applicants, according to their supplementary heads of argument,
persist with only three requests, namely those listed in paragraphs
1.1, 1.2 and 1.6 of the Notice in terms of
Rule 30 A (1)
("the
relevant requests"). The effect of this, therefore, is that only
three requests remain deserving of attention.
[12]
The issue to be resolved, regard being had to what I said above, is
whether the applicants can legally and validly invoke the
application
of
Rule 35(14).
Put differently, have the applicants done
enough to be entitled to the relief that they seek.
[13]
To be able to resolve the issue, regard must be had to
Rule 35(14)
which should be read with
Rule 35(13).
[14]
Rule 35(13)
provides:
"(13) The provisions of this
rule relating to discovery shall mutatis mutandis apply, in so far as
the court may direct, to
applications".
[15]
Rule 35(14)
provides:
"(14)
After
appearance to defend has been entered. any party to any
action may, for purposes of pleading
, require
any other party to make available for inspection within five days
a
clearly specified document or
tape
recording
in his possession
which is relevant to
a
reasonably anticipated issue in the
action
and to allow
a
copy or transcription to be
made thereof'.
(my emphasis).
[16]
For a better resolution of the issue, although the applicants are not
pursuing it, I will refer to
Rule 35(12)
which provides:
"(12)
Any party to
any proceeding
may at any time before the hearing thereof
deliver
a
notice as near as may be in accordance with Form 15
in the First Schedule
to any other party in whose pleadings
or affidavits
reference is made to any document or tape
recording to produce such
document or tape recording for his
inspection and to permit him to make a copy or transcription
thereof."
(my emphasis).
[17]
The respondent opposes this application on the following grounds:
1. The documents that the applicants
requested in terms of Rule 35(14) are irrelevant and unnecessary for
the purpose of preparing
answering affidavits. The reasons therefor
are that:
1.1 The respondent contends that it
simply avers that the applicants stole R989 000.00 from it on 24
December 2013;
1.2 The first applicant maintains that
he paid himself and the second applicant such amounts in respect of
purported "notice
period claims".
1.3 The applicants simply need to
admit or deny the theft and/or justify taking the money.
2. The applicants, in terms of Rule
35(13) failed to seek directions from the Court that Rule 35(14) be
invoked.
[18]
The remaining documents that the applicants still need in terms of
the Notice in terms of
Rule 30A(1),
dated 17 December 2014,
are the following:
"1.1 An Account Confirmation
Letter from Standard Bank of South Africa ("Standard Bank') and
all documentation evidencing
that the bank account referred to in
paragraphs 4 and 26 of the Applicants Founding Affidavit is in the
name of and/or belongs
to the applicant;
1.2 All documentation evidencing
the full identity of the account holder of the bank account holder of
the bank account referred
to in paragraph 4 of the Applicant's
Founding Affidavit;
1.6 All documentation evidencing
that Annexure: "JLDM5" represents the bank account of the
Applicant."
[19]
The applicants contend that the documents that are required are
relevant and necessary as they would conclusively prove whether
or
not the respondent is the owner or has interest in the account from
which the money was allegedly stolen by them. It is their
further
contention that the respondent, without raising any technical
objection that the applicants were not entitled to employ
the
provisions of
Rule 35(12) and (14),
elected to reply, albeit
inadequately, to the applicants Notice.
[20]
The applicants, in their heads of argument, deal with relevance and
the importance of transparency as well as fairness and
equity. I do
not think that it is necessary to deal with these aspects as the
applicants failed to seek and get direction from
the court in terms
of
Rule 35(13).
These aspects, in my view, become relevant
when the court exercises its discretion to give such direction which,
in any event, is
given in exceptional circumstances. (See:
Saunders
Valve Co Ltd v lnsamcor (Pty) Ltd
1985 (1) SA 146
(T)
and
Premier
Freight (Pty) Ltd v Breathetex Corporation (pty) Ltd
2003 (6) SA 190
(SE) at Para [1O] and [12]).
[21]
To require the applicants to obtain direction from the Court,
according to the applicants, would make the application over
formalistic and contrary to the purpose of the rules themselves. For
the reasons I shall later give, I do not agree.
[22]
The applicants contend that no irregularity or prejudice would result
should the relief sought by them be granted. I do not
think it is so
much the issue of irregularity and prejudice as the issue of
complying with the rules which I shall also show later
in this
judgment.
[23]
The applicants, as a result, implore the Court to exercise its
discretion in their favour and direct the production of the
conclusive proof that they request.
[24]
A submission on behalf of the respondent is that the applicants
cannot invoke
Rule 35(14)
without the necessary direction from
the Court. I agree.
[25]
Southwood J in
Loretz v Mackenzie
1999 (2) SA 72
(T)
had an
occasion to deal with
Rules 35(1) and (13). Rule 35(1)
deals
with discovery of documents before the close of pleadings. This
cannot be
done
unless a party has leave of the Court to call on the other party to
discover documents. Direction, in terms of in
Rule 35(13),
is
a requirement for a party to engage in such an action.
Southwood
J, at 74F-H of
Loretz v Mackenzie
(supra)
said:
"It is clear that the Uniform
Rules of Court do make provision for the provisions of rule 35
relating to discovery to apply
to applications.
But this is
clearly and unequivocally stated to be subject to the proviso that
the Court direct that this be so
. The applicant's first
argument requires that the clear wording of the Rule 'insofar as the
Court may direct' be ignored. This
clearly cannot be done and no
authority for so doing was referred to."
(my emphasis).
[26]
It was submitted, on behalf of the respondent, that the wording of
Rule 35(14)
is unambiguous. It applies to:
1. An "appearance to defend".
Clearly a Notice of intention to oppose in an application is
excluded.
2. "Any party to any action".
Indeed, an action does not include an application just as
Rule
35(1)
does not.
3. "For purposes of pleading".
Indeed, in applications reference would be made to "answering
affidavits".
Rule 35(14)
does not deal with answering
affidavits. The documents that
Rule 35(14)
refers to are
documents which are necessary to enable a party to plead which means
to deliver a plea.
[27]
Rule 35(14),
according to the respondents counsel, differs
from
Rule 35(12)
which clearly applies to applications.
Rule
35(12)
applies to "any proceeding" which in its context
includes "applications" and "actions". Reference
is also made to "pleadings or affidavits".
Rule 35(14)
clearly excludes applications. If an extension is required to
cover applications in discovery matters, clearly the direction of the
Court, becomes a requirement. What Southwood J says at 75A-C in the
Loretz case
is very instructive. There the Court said:
"The Rules, and in particular
Rule 35(13),
provide for
a
party to
seek to have
the rules of discovery made
applicable to
a
particular application. That is
an essential prerequisite for
a
notice in terms
of Rule 35(1) and obviously for an application to compel compliance
with
a
notice in terms of Rule 35(1). There
is no need for the court to exercise any discretion or
inherent power or jurisdiction before an order has been
sought
in terms of rule 35(13) and
refused.
All the issues relating to fairness and equity can be considered when
such
a
discretion is sought.
The
Court will normally only exercise
a
discretion or an inherent
power or jurisdiction to regulate its proceedings where there is
a
lacuna in the Rules".
(my emphasis).
[28]
The submission, on behalf of the respondent, is that the Court's
reasoning in the
Loretz case
(supra)
equally applies to
a case where a party seeks to invoke
Rule 35(14)
such as the
current case.
[29]
Counsel, on behalf of the respondent, submitted that the respondent's
failure to answer the applicants'
Rule 35(14)
Notice in no way
amounts to an irregular step as the applicants failed to obtain a
direction and/or permission from the Court to
proceed as they did.
They did not have such and entitlement in terms of
Rule 35(14)
.
[30]
It was further submitted, on behalf of the respondent, that the
obtaining of the direction would not have saved the applicants
who
still would have needed to comply with the requirements of Rule
35(14).These requirements were laid down in
Cullinan Holdings Ltd
v Mamelodi Staadsraad
1992 (1) SA 645
(T) at 647 E-F
. These are:
1. that the litigant must show that
the documents requested are essential for purposes of pleading, and
2. that the documents must be relevant
to a reasonably anticipated issue between the parties. At 647F of the
Cullinan case
(supra)
the test was said to be whether the
documents are "essential" and not "useful".
The
applicants' conduct, according to Counsel, for the respondent,
amounts to a "fishing expedition". (See:
Cullina's case
(supra)
at
648F-G
).
[31]
Further it was submitted that it is not essential before delivering
their answering affidavits, for the applicants to see:
"1. The account confirmation
letter from Standard Bank or documentation evidencing that the bank
account referred to is in
the name of and/or belongs to Ferreiras;
2.
documentation evidencing the
full identity of the account holder of the bank account;
3. any documentation submitted to
Standard Bank in terms of the
Financial Intelligence Centre Act 38 of
2001
in order to procure the opening of the bank account;
4.
the account application
forms
or documentation submitted by Ferreiras to Standard Bank
to procure the opening of the bank account;
5.
the resolution
purportedly referred to in paragraph 12 of the founding affidavit in
the main application; or
6. the documentation evidencing
that annexure
5
to the founding affidavit (a printout of
Ferreiras' bank statement) represents Ferreiras' bank account
(referred to
as
"request 1" to "request 6"
respectively)".
I
agree.
[32]
Indeed, the respondent's case is simple and straightforward. The
averment is that the applicants stole the respondent's R989
000.00
when they unlawfully accessed its bank account and paid themselves
such an amount after they resigned from the respondent
as directors
and employees. All the applicants need to do, according to the
submission, is to state that they are not guilty of
the conduct
complained of i.e. denying that they paid themselves as alleged or
that they have some or other justification for paying
themselves. I
agree.
[33]
The applicants, clearly did not comply with
Rule 35(13)
and
this means that they were not entitled to proceed with the
Rule
35(14)
Notice. The direction and permission the rule makes
provision for has not been obtained. They further failed to prove
that the documents
are essential and relevant to any anticipated
issue between them. Failure to obtain direction or permission, on its
own, is sufficient
to have the application dismissed.
[34]
Finally, it was submitted on behalf of the respondent, that the
applicant's irregular step Notice and the application based
thereon
are consequently without merit and that the current application, in
terms of
Rule 30A
(2)
, falls to be dismissed with costs. I
agree.
[35]
The following order, in the result, is made:
The
application is dismissed with costs.
____________________
W.
M. MSIMEKI
JUDGE
OF THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION OF THE HIGH COURT,
PRETORIA