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[2016] ZAGPPHC 1065
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Standard Bank of South Africa v Schneider and Another (7589/2016) [2016] ZAGPPHC 1065 (15 December 2016)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
Case
no: 7589/2016
15/12/2016
Reportable:
No
Of
interest to other judges: No
Revised.
THE
STANDARD BANK OF SOUTH
AFRICA
Applicant
and
AUBREY
SCHNEIDER
1
st
Respondent
STEPHEN
ZAGEY
2
nd
Respondent
JUDGMENT
MNGQIBISA-THUSI
J:
[1]
In its notice of application for summary judgment against the
defendant, the plaintiff seeks an order in the following terms:
1.1 payment of the sum of
R 1 234 260.91;
1.2 interest on the sum
of R 1 234 260. 91 at the rate of 7.35% per annum, from 10 September
2014; and
1.3 costs.
[2]
The plaintiff, Standard Bank of South Africa Limited, sues the
defendants in the capacity as sureties for the debts incurred
by an
entity known as Simcha Properties 10 CC ("the principal
debtor"), which was placed under voluntary liquidation
in terms
of section 352 (2) of the Companies Act
[1]
on 16 October 2012.
Factual
background
[3]
On or about 10 March 2006 the plaintiff, and the principal debtor
concluded a home loan a1reement in the amount of R1, 839,
174.00. The
terms of agreement included, inter alia, the following:
3.1 that the amount of
the loan was in the sum of R1 ,839, 174.00;
3.2 that interest will be
charged at a variable interest rate of 1.9% below prime on the
1:apital amount;
3.3 that in the event of
the principal debtor defaulting on its instalments or committing an
act of insolvency or falling into liquidation,
then the full amount
owing will become due;
3.4 that a certificate
signed by any of the plaintiff's managers or branch administrators,
will on its mere production be sufficient
proof of the principal
debtor's liability unless the contrary is proved.
[4]
On the 19 November 2014 the plaintiff caused to be delivered to the
defendants a notice in terms of section 72 of the National
Credit
Act.
[5]
The plaintiff has issued summons against the defendants for payment
of the capital amount (R1 234 260.91) of the loan. The defendants
filed notice of intention to defend and as a result the plaintiff
applied for summary judgement. On 24 February 2016 the defendants
also caused to be delivered to the plaintiff a notice in terms of
Rule 23 (1) in which they raised several grounds excepting to
the
plaintiff's particulars of claim and on 22 February 2016 served a
notice in terms of Rule 30(2) (b) for the plaintiff to remove
certain
cause of complaint as set out in the notice.
[6]
In their affidavit resisting summary judgment, the defendants have
raised several points
in limine.
I propose to deal with each
point
in limine
raised and in the notice of exception,
chronologically.
[7]
The first point of complaint raised by the defendants is that the
amount claimed by the plaintiff in its summons is incorrect.
It is
the defendants' contention that the amount claimed should have been
reduced by amount of the dividend plaintiff received
as a result of
the liquidation of the principal debtor. According to the defendants
the plaintiff appears to have received a dividend
of R130 000.00
after the principal debtor was liquidated.
[8]
In the particulars of claim the plaintiff alluded to the fact that
the loan amount was secured by a mortgage bond. Even though
the
plaintiff in its particulars of claim have claimed an amount of R1
234,260.91 , at the hearing of this matter the amount claimed
was
reduced to an amount of R1 104,260.91, proposed in the draft order.
This reduction in the amount claimed does address the complaint
by
the defendants. I am therefore of the view that the complaint in this
regard has become academic.
[9]
Secondly, the defendants allege that the deponent to the plaintiff's
affidavit in support of the application for summary judgment
does not
have authority to depose to the affidavit and has no direct personal
knowledge of the plaintiff's cause of action. It
is the defendants'
contention that since they have never dealt with the deponent to the
plaintiff's affidavit she cannot claim
to have personal knowledge of
the dispute between the parties. Secondly the defendants allege that
Ms Wilson lacks the authority
to depose to the affidavit in that she
is not the manager who signed the certificate of balance.
[10]
Rule 32(2) of the Uniform Rules of Court provides that the affidavit
in support of an application for summary judgment must
be deposed to
by a person who:
11.1. can swear
positively to the facts; and
11.2. who can verify the
cause of action and the amount claimed.
[11]
In the affidavit in support of the application for summary judgment,
the deponent, Ms Danielle Jeanne Wilson ("Ms Wilson"),
states,
inter alia,
that:
"1. I am a Manager:
Specialised Legal, Personal and Business Banking Credit division of
the Standard Bank of South Africa ...;
2. I confirm that I have
been duly authorised by the Applicant/Plaintiff to institute these
proceedings and depose to this affidavit.
..
3. I verify and confirm
that I have through my position access to all the records and
information in the possession of the Applicant/Plaintiff,
pertaining
to this matter...
4. I have perused the
records in my possession and have acquainted myself with the contents
thereof, and therefore the facts herein
contained fall within my
direct knowledge unless the contrary is indicated.
5. I therefore positively
verify the facts and cause of action as set out in the particulars of
claim and I verify the amount as
set out in the certificated of
balance.
6. I state that it is my
opinion that there is no bona fide defence to the action and that
notice of intention to defend has been
delivered has been entered
solely for the purpose of delay."
[12]
Counsel for the plaintiff submitted that Ms Wilson has access to all
the documents relating to the defendants'/principal debtor's
account
and is in a position to depose to the affidavit in support of summary
judgment.
[13]
In
Maharaj
v Barclays National Bank Ltd
[2]
the
court stated, with regard to the requirements for an affidavit in
support of a summary judgment application , at 423E-H, that:
"The mere assertion
by a deponent that he can swear positively to the facts (an assertion
which merely reproduces the wording
of the Rule) is not regarded as
being sufficient, unless there are good grounds for believing that
the deponent fully appreciated
the meaning of these words .... While
undue formalism in procedural matters is always to be eschewed, it is
important in summary
judgment applications under Rule 32 that, in
substance, the plaintiff should do what is required of him by the
rule. The extraordinary
and drastic nature of the remedy of summary
judgment in its present form has often been judicially emphasised
.... The grant of
the remedy is based upon the supposition that the
plaintiff's claim is unimpeachable and that the defendant's defence
is bogus
or bad in law. One of the aids to ensuring that this is the
position is the affidavit filed in support of the application; and to
achieve this end it is important that the affidavit should be deposed
to either by the plaintiff himself or by someone who has
personal
knowledge of the facts."
[14]
Further, in
FirstRand
Bank Ltd v Trustees for the time being Huganel Trust and Others
[3]
,
Davis J
emphasised the following three important points:
"1. While summary
judgment is an order which will prevent a defendant from having his
day in court, there are many cases where
the plaintiff is entitled to
relief on the basis that,
ex facie
the papers which have been
filed, there is no justification for concluding that opposition can
be regarded as anything other than
a delaying tactic.
2. As Corbett JA
emphasised in
Maharaj,
excessive formalism should be eschewed.
Hence the substance of the dispute, together with the purpose of
summary judgment, needs
to be taken into account during the
evaluation of the papers which have been placed before court in order
to determine whether
the summary judgment form of relief should be
justified.
3. While a measure of
commercial pragmatism needs to be taken into account, in that many of
these summary judgment applications
are brought by large corporations
and, accordingly, it may well be that first-hand knowledge of every
fact cannot and should not
be required, each case must be assessed on
the facts which were placed before the court. It follows therefore
that the nature of
the defence becomes the starting point. .... On an
evaluation of both the claim and the defence, it could be concluded
with justification
that the deponent had sufficient knowledge to
depose to the affidavit, which formed the basis of the factual matrix
to sustain
an application for summary judgment".
[15]
I am satisfied that the deponent to the affidavit in support of the
summary judgment application does have sufficient knowledge
about the
defendants' account in that she deposes to the fact that she has had
access to the defendants' account, has gained knowledge
of the coming
and goings in this account and is one the people within the plaintiff
best suited person to depose to an affidavit
on behalf of the
plaintiff. In this regard reliance is also placed on
FirstRand
Bank Ltd v Carl Beck Estates (Pty) Ltd and Another
[4]
where
the court held that:
"In the present
instance the deponent to the founding affidavit is the 'Operations
Manager Arrears Legal' which title clearly
indicates knowledge of
arrears in monies owing to plaintiff and legal responsibility
therefore. In the present case the deponent
does not ask the court to
rely on inferences to be drawn. He states that the facts contained in
the affidavit fall within his personal
knowledge and are based on
records and documents available to him. He is indeed pre-eminently
the person who would have knowledge
of the relevant facts".
[16]
Nothing turns on the fact that the certificate of balance was signed
by a different manager. Furthermore even though the plaintiff
did not
attach her authority to depose to the affidavit, I am of the view
that this technical point raised by the defendants can
easily be
resolved. This point raised by the defendants has to fail.
[17]
Some of the grounds upon which the defendants raised an exception to
the plaintiff's particulars of claim as set out in the
defendant's
notice of exception dated 17 March 2016. Some of the grounds have
been dealt with in the defendants' affidavit resisting
summary
judgement. I will not deal with those grounds which are repeated in
the notice of exception as I have already dealt with
them in the
paragraphs above.
[18]
The first ground of exception raised by the defendants is that at
paragraph 9 of the particulars of claim the plaintiff states
that "on
or about the 101h of March 20016 ..." I is the defendants'
contention that the date as set out in paragraph
9 does not accord
with the date on the surety agreement. I am of the view that it is
clear that there was a typographical error.
Where the plaintiff
states the year as 20016 it is apparent that what is alluded to is
the year 2016. And therefore of the view
that this ground has no
merit.
[19]
The second ground raised by the defendant in the notice of exception
is that plaintiff's particulars of claim do not comply
with Uniform
Rule 18(6) in that it failed to state that the loan agreement and the
suretyship agreement attached are true copies
of the original
agreement. It is the defendants' contention that the plaintiff's
particulars of claim are vague and embarrassing
in that it lacks
sufficient particularity and the defendants are unable to plead
thereto.
[20]
Where the excipient claims that the particulars of claim are vague
and embarrassing, an attack is made on the pleadings as
a whole in
that although the particulars of claim might disclose a cause of
action, there is some defect or they are incomplete.
[21]
It is trite that an exception to a pleading on the basis that it is
vague and embarrassing will not be upheld unless failure
to do so may
prejudice the excipient. Furthermore, the court must look at the
pleading excepted to as it stands and cannot take
into account any
facts outside those stated in the pleading except those stated in the
pleading and cannot refer to any other document.
Erasmus Superior
Court Practice
at 81-151).
[22]
In
Trope
v South African Reserve Bank and Another
[5]
,
the court stated that:
"An exception to a
pleading on the ground that it is vague and embarrassing involves a
two-fold consideration. The first is
whether the pleading lacks
particularity to the extent that it is vague. The second is whether
the vagueness causes embarrassment
of such a nature that the
excipient is prejudiced
(Quinlan v
MacGregor
1960 (4) SA 383
(D) at 393E-H). As to whether there is prejudice, the ability of the
excipient to produce an exception-proof plea is not the only,
nor
indeed the most important, test - see the remarks of Conradie J in
Levitan v Newhaven Holiday Enterprises CC
1991 (2) SA 297
(C)
at 298G-H. If that were the only test, the object of pleadings to
enable parties to come to trial prepared to meet each other's
case
and not be taken by surprise may well be defeated".
[23]
The defendants have also raised the point that the plaintiff did not
comply with Rule 18(6)
[6]
in
that it failed to annex a true copy of the agreement to the summons.
It is the defendants' contention that the particulars of
claim do
not, therefore, disclose a cause of action nor does it comply with
Rule 18(6) in that the plaintiff has not attached the
loan agreement
and has not fully set out the terms of the agreement.
[24]
In its particulars of claim, the plaintiff sets out that for its
cause of action it was relying on a home loan and suretyship
agreements it concluded with the principal debtor and the defendants,
sets out the amount loaned and secured and the interest charged.
Furthermore, the plaintiff attached to its particulars of claim a
copy of the agreement.
[25]
I am of the view that the is no basis for the defendants' objection
in that the particulars of claim set out the basis on which
the
plaintiff is seeking the relief claimed in that it has pleaded the
conclusion of the loan and suretyship agreements, which
is not denied
by the defendants, has set out the amount claimed and the manner in
which the interest can be ascertained. The defendant's
objection
ought to fail.
[26]
I am of the view that the points
in limine
raised by the
defendant and the grounds raised in the defendants' notice of
exception ought to fail.
[27]
The test for summary judgment is whether the defendant raises a
defence which if tested at trial will lead to the defendant
succeeding.
[28]
In their affidavit, the defendants have admitted that they bound
themselves as sureties for the principal debtor's indebtedness
to the
plaintiff. The defendants have pleaded that they have a bona fide
defence to the plaintiff's claim. The first ground of
d1efence raised
by the defendants is that the plaintiff's claim has prescribed in
terms of the provisions of section 11(d) of the
Prescription Act
[7]
.
It is the defendants' contention that after the principal debtor was
liquidated the plaintiff's claim against the defendants became
due
and payable. Further it is the defendants' that failure by the
plaintiff to enforce or to put into operation the acceleration
clause
as provided for in clause 42 of the agreement did not have the effect
of preventing prescription from starting to run with
regards to the
plaintiff's claim against them. It is therefore the defendants'
contention that since 2012, three years has elapsed
and therefore the
plaintiff's claim against them has prescribed.
[29]
In this regard plaintiff relied on the decision in
Miracle
Mile Investments
67
(Pty)
Ltd v Standard Bank of South Africa Ltd
[8]
where
the court held that a suretyship is an accessory to the loan
s1greement and that therefore if prescription has run out with
regard
to the main loan agreement it also has run out with respect to the
suretyship. It is the plaintiff s contention that the
suretyship has
not started running in that the period all section 11(d) does not
apply to debts relating to a mortgage bond.
[30]
I am of the view that before prescription would start running, the
defendants' liability in terms of the suretyship must have
been due
and payable. In terms of clause 4.2 of the suretyship agreement,
before the plaintiff could enforce its rights in terms
of the
suretyship it had to demand payment from the defendants and put them
on terms. This is done by the plaintiffs on 19 September
2014 when it
sent the defendants a letter of demand in terms of section 72(1) of
the National Credit Act. In terms of this letter
the defendants were
put to terms that failure to pay within 10 days of delivery of the
letter the agreement would be cancelled
and the full amount owing
would become immediately due and payable. This means that 10 days
after the letter was delivered to the
defendant prescription sta11ed
running. The date of delivery of the section 72(1) letter was 5
November 2014. This means that 10
days should have expired
approximately around 20 November 2014. Therefore in terms of the
defendants' argument that section 11(d)
applies, from November 2014
to the date summons were issued and served on the defendants the
period of prescription in terms of
this section has not lapsed. It
cannot be said that in this case prescription started running after
against the principal
debtor since the principal debtor sues the
principal debtor was liquidated in 2012. Prescription in the case of
the defendants
would only start running once the plaintiffs claim in
terms of the suretyship became due. Even though the defendants'
liability
was accelerated when the principal debtor was liquidated
that debtor the debts will become due and payable once the plaintiff
had
delivered a letter of demand to the defendants. I am of the view
that the applicable period of prescription in this matter s 30
years
as alluded to by the plaintiff.
[31]
The second ground relied upon by the defendants as a defence against
the plaintiff s claim is that the plaintiff failed to
comply with the
provisions of section 80 of the National Credit Act in that it had
granted reckless credit to the defendants.
[32]
According to the defendants the home loan and the conclusion of a
suretyship agreement with them amounted to reckless credit
which is
prohibited in terms of section 80 read with section 119 of the Act.
[33]
Section 80 (1) of the Act reads as follows:
"(1) A credit
provider is reckless if, at the time that the agreement was made, or
at the time when the amount approved in
terms of the agreement is
increased, other than an increase in terms of section 119 (4)-
(a) the credit provider
failed to conduct an assessment as required by section 81 (2),
irrespective of what the outcome of such
an assessment might have
concluded at the time; or
(b) the credit provider,
having conducted an assessment as required by section 81 (2), entered
into the credit agreement with the
consumer despite the fact that the
preponderance of information available to the credit provider
indicated that-
(i) the consumer did not
generally understand or appreciate the consumer's risks, costs or
obligations under the proposed credit
agreement; or
(ii) coming entering into
that credit agreement would make the consumer over-indebted".
[34]
The provisions of the Act dealing with reckless credit do not apply
where the consumer is a juristic person. Furthermore credit
was not
granted to the defendants but to the principal debtor.
[35]
The defendants have not, in their affidavit resisting summary
judgment, alluded to valid grounds in support of their assertion
that
they have a bona fide defence to the plaintiff's claim and that they
have not entered an appearance to defend solely for the
purpose of
delay.
[36]
It is not in dispute that the defendants have not satisfied the
plaintiff's claim in terms of the suretyship agreement. I am
satisfied that the defendants have entered appearance to defend
merely in order to delay the plaintiff's claim. I see no reason
why
summary judgment in favour of the plaintiff should not be granted
under the circumstances.
[37]
In the result the following order is made:
That summary judgment is
granted in favour of the plaintiff against the defendants, jointly
and severally the one paying the other
to be absolved, for:
1. payment of the sum of
R 1 104 260.91;
2. interest on the amount
of R 1 104 260.91 at the rate of 7.35% per annum from 10 September
2014;
3. Costs as between
attorney and client to be taxed.
_____________________
N
P MNGQIBISA-THUSI
Judge
of the High Court
Appearances:
For
the Plaintiff: Adv R Raubenheimer
Instructed
by: Vezi & De Beer Inc
For
the Defendant: Adv C Cothill
Instructed
by: Garrat Hugo & De Souza Attorneys
[1]
Act 61 of 1973.
[2]
1976 (1) SA 418 (A).
[3]
2012 (3) SA 167 (WCC).
[4]
2009 (3) SA 384
(GSJ) at para. 26.
[5]
1992 (3) SA 208
(T) at 211.
[6]
Rule 18(6) provides that: "A party who in his pleading relies
upon a contract shall state whether the contract is written
or oral
and when, where and by whom it was concluded, and if the contract is
written a true copy thereof or of part relied on
in the pleading
shall be annexed to the pleading.
[7]
Act 68 of 1969.
[8]
2016 (2) SA153 (GJ)