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[2016] ZAGPPHC 991
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Gouws v Draht NO and Others (47609/2015) [2016] ZAGPPHC 991 (28 October 2016)
THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED
CASE
NUMBER: 47609
/
2015
DATE
OF HEARING: 12 OCTOBER 2016
DATE
OF JUDGMENT: 28 OCTOBER 2016
In
the matter between:
SUSARA
JOHANNA GOUWS
Applicant
and
HEIKO
DRAHT N.O
First
Respondent
JUANITO
MARITN DAMONS N.O
(In
their capacity as trustees of the insolvent estate of Susara Johanna
Gouws)
Second
Respondent
THE
MASTER OF THE HIGH COURT
Third
Respondent
ABSA
BANK
LTD
Fourth
Respondent
JUDGMENT
AVVAKOUMIDES,
AJ
[1]
This is an application for rescission of default judgment brought by
the applicant in terms of rule 42(1)(a) of the Uniform
Rules of
Court. The judgment sought to be rescinded is a voluntary surrender
of the applicant's estate.
[2]
Rule 42(1)(a) of the Uniform Rules of Court provides the following:
"(1) The court may,
in addition to any other powers it may have,
mero motu
or upon
the application of any party affected, rescind or vary:
(a) An order or judgment
erroneously sought or erroneously granted in the absence of any party
affected thereby."
[3]
It is not possible for a voluntary surrender application to be
brought in the absence of the applicant, i.e. without the knowledge
of the applicant. So much must be obvious. This case however raises
some interesting points for consideration. The applicant alleged
that
at the time of the voluntary surrender she was under the mistaken
belief that she did not own enough assets to cover her liabilities.
She explained that on 10 October 1987 she was married in community of
property. She was divorced on 10 April 2000 after which she
lost
contact with her ex-husband. She and he ex-husband entered into a
settlement agreement during the finalisation of the divorce
proceedings. On 31 May 2012 her ex-husband passed away.
[4]
The applicant submitted that during 2014 she became aware of a
Windeed search following a search and investigation by her attorneys
of record, showing that she was the owner of more immovable property
than she was aware of. She says that after going through her
records
she also found out that there was a settlement agreement which she
forgot about. She also obtained a copy of her ex-husband's
will and
the fact that she was the owner of more properties only came to her
attention when the trustees were appointed. Had she
known about the
properties she would not have applied for her voluntary surrender.
This is the gist of the application.
[5]
I find it most unlikely that a person would go through divorce
proceedings during which she acquired immovable property, sign
a
settled agreement in consequence thereof and then simply forget about
the immovable property. The immovable property must have
had some
impact on the applicant's life over some 9 years following her
divorce to the date of the voluntary surrender order. Rates
and taxes
and other levies must have been payable in respect of such immovable
property. She could not simply have been oblivious
to the existence
of the property in her name. The applicant does not allege anything
whatsoever in this regard, save that she had
no idea that she was the
owner of such additional property.
[6]
The Windeed searches show 4 farms of which the applicant was joint
owner by virtue of the marriage in community of property.
An
additional property in the name of a close corporation in which the
applicant and her ex-husband each held 50% of the members'
interest
is mentioned in the settlement agreement. The applicant failed to
tender the wasted costs of the administration of her
insolvent estate
in her founding affidavit.
[7]
I enquired from counsel for the applicant whether the applicant had
the necessary
locus standi
to bring the application without
the assistance of the trustees, particularly in the light of the
trustees' opposition. Both counsel
submitted that the applicant had
the necessary
locus standi
but could not furnish any authority
for such submission.
[8]
I will deal with the issue of
locus standi
further hereunder.
A court is given specific authority to rescind, vary or amend any
order made by it under the provisions of Section
149(2) or the
Insolvency Act, 24 of 1936 ("the Act"). No grounds on which
a court may do so are stated, thus the court
must exercise its
discretion in the light of the circumstances disclosed to it. (See:
Hoffenberg & Co v Pearl 1952 SR 298 and
Ex Parte Van der Merwe
1962 (4) SA 71
(0)). Any order would include a sequestration order
and in terms of section 2 of the Act, and sequestration order
includes a provisional
order. The fact that a sequestration order has
been granted does not affect the insolvent's competence to apply for
a rescission
since such application does not amount to litigation
with regard to the assets of the estate. (See: Malebo and Another v
Schoonraad
& Others
2005 JOL 13609
(T).
[9]
The main guidelines for rescission of such order were set out in
Storti v Nugent and others
2001 (3) SA 783
(IN) in which Gautschi AJ
stated as follows:
"The principles to
be gleaned from the authorities, often not harmonious, are in my view
the following:
(1) The Court's
discretionary power conferred by this section is not limited to
rescission on common-law grounds.
(2) Unusual or special or
exceptional circumstances must exist to justify such relief.
(3) The section cannot be
invoked to obtain a rehearing of the merits of the sequestration
proceedings.
(4) Where it is alleged
that the order should not have been granted, the facts should at
least support a cause of action for common-law
rescission.
(5) Where reliance is
placed on supervening events, it should for some reason involve
unnecessary hardship to be confined to the
ordinary rehabilitation
machinery, or the circumstances should be very exceptional.
(6) A Court will not
exercise its discretion in favour of such an application if
undesirable consequence would follow."
[10]
The court held further at 807 A that:
"On either basis,
the applicant must bring itself within a rescission under the common
law. That involves establishing "sufficient
cause", which
in turn involves two essential elements -
(a) the party seeking
relief must present a reasonable and acceptable explanation for his
default, and
(b) on the merits such
party must have a bona fide defence which, prima facie, carries some
prospect of success."
[11]
The trustees submitted that the application could not succeed
for the following reasons:
[11.1] the applicant
failed to join the creditors in her insolvent estate. She had
knowledge of the details of her creditors and
referred to them in her
application for the surrender of her estate. These creditors include
the relevant local Municipality, Oosthuizen
& Roeland, Dynamic
Auctioneers and certain of her family members. Furthermore, the
applicant's attention was drawn to her failure
to join the creditors
in the answering affidavits and this notwithstanding she persisted in
her failure to join all of her creditors
or to take any steps to
alert the creditors to this application.
[11.2] the applicant
bears the
onus
to prove that she is solvent. The applicant did
not give any information for consideration of the submission that the
undisclosed
property would render her solvent, save for mere
allegations to this effect. In the founding papers the following
appears:
''The factual position
was that I owned more than enough immovable assets to cover all of my
liabilities, and should I, or any other
relevant party have known the
true state of affairs, the application would never have been brought
and/or the order would not have
been granted."
[11.3] the applicant
failed to provide an independent valuation of the undisclosed
property but only attached a Windeed search which
was conducted some
eight months prior to the launching of this application. In paragraph
6.1 of the founding affidavit the applicant
referred to the trustees'
report dated 24 June 2014 in which the shortfall in her estate is
given as R1 825 661.64 at that stage.
[11.4] the trustees'
report was issued during 2014. In the answering it is stated that
family members of the applicant have a claim
of approximately R2 000
000.00 against the insolvent estate. This brings the shortfall to R3
825 661.64. The applicant's submission
that, given the undisclosed
property, she now has enough assets to cover her debts is not
supported by the facts. In annexure "SJG05"
to the founding
papers the properties held under title deed numbers T5332/926,
T358/942 and T212/953 reflect a joint purchase price
R591 000.00.
According to annexure "SJG05" the properties have certain
bonds registered over them. The applicant has
also not joined the
bondholders. Moreover, the outstanding debt in terms of these bonds
has not been disclosed.
[11.5] the prejudice to
creditors is an essential consideration. The trustees have submitted
that there are not enough assets in
the estate to pay the secured
creditor. The costs wasted in the administration would be enormous
and to to restore the estate would
entail astronomical amounts of
money.
[11.6] provisional
dividends have already been paid to creditors and to undo the
concursus creditorum
would be practically impossible. The
undisclosed properties are not liquid and there is no proof of their
value.
[11.7] the applicant
failed to show that she is solvent and is clearly insolvent,
alternatively commercially insolvent. She has
failed to show that the
immovable property could be readily sold to provide funds to the
insolvent estate.
[12]
The trustees submitted that, based on the objective facts
provided by the trustees themselves, an inference may be drawn that
the
real reasons for applicant's application is to avoid an
insolvency enquiry wherein she and her family may be questioned
further
about various assets. The submission is based on the
following facts and chronology:
[12.1] in her ex parte
application to surrender her estate ("the main application")
the applicant stated that she only
owns a television, three beds and
a fridge. The trustees then attached a large list of assets.
[12.2] the applicant
failed to state, in the main application, that she owned a second
immovable property. She states in the founding
papers that Annexure
"SJG04" indicates,
"what I also believed to be
correct''
that her estate consisted of two immovable properties.
Annexure "SJG04" is the report by the trustees. This
annexure is
not annexed to the main application. The applicant failed
to disclose the second property in the main application.
[12.3] the applicant
failed to disclose that she owned a third immovable property. She
states that she "forgot" about
the settlement agreement in
her divorce but the evidence of the trustees is that when she was
asked about the settlement agreement
in the insolvency enquiry she
could not provide the trustees with a copy thereof.
[12.4] the trustees
submitted that the applicant's conduct has been uncooperative and
that the timing of the disclosure of the additional
property is
mala
fide.
This application was brought after subpoenas were served on
the applicant's mother and her son to attend an insolvency enquiry.
[12.5] the applicant had
knowledge of the third immovable property during 2014 but only
launched this application during 2015. The
applicant did not inform
the trustees of the additional properties upon becoming aware
thereof.
[13]
The applicant persisted in the application under rule 42 on the basis
that the judgment was incorrectly sought and incorrectly
granted. I
cannot agree with this submission. The application should have been
brought under the common law. In any event, the
applicant has made
out no other case than that she sought to obtain a rehearing of the
merits of the voluntary surrender application
proceedings, given the
newly disclosed assets. The remaining submissions on behalf of the
applicant did not support the relief
sought by the applicant and I am
not persuaded that the application should succeed. Moreover, on the
facts before me I am of the
view that this application is not brought
bona
fide.
[14]
I accordingly make the follow order: the application is dismissed
with costs.
__________________________________
G.T.
AVVAKOUMIDES
ACTING
JUDGE OF THE HIGH COURT
GAUTENG
DIVISION, PRETORIA
DATE:
28 OCTOBER 2016
Representation
for Applicant:
Counsel:
D. A. De Kock
Instructed
by:
Walker Attorneys
Representation
for First and Second Respondents:
Counsel:
G. Naude SC
Instructed
by:
Heiko Draht Attorneys