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[2015] ZAGPPHC 196
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Musgrave Agencies CC v Hoffman (39677/2011) [2015] ZAGPPHC 196 (27 March 2015)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE
NO. 39677/2011
DATE:
27 MARCH 2015
REPORTABLE
OF
INTEREST TO OTHER JUDGES
In
the matter between:
MUSGRAVE
AGENCIES
CC
.................................................................................................
Applicant
and
WR
HOFFMAN
.....................................................................................................................
Respondent
JUDGEMENT
DE
VOS J:
[1]
In this matter the Applicant, in two interlocutory applications which
are heard simultaneously, seeks an order against the Defendant
that
certain amendments effected by the Defendant to his plea be set
aside. Plaintiff instituted an action against the Defendant.
Defendant defends the action and filed a plea. In the present
matter, Plaintiff is the applicant. Defendant in these
applications is respondent. For convenience the applicant will
be referred to as Plaintiff and the respondent as the Defendant.
Both interlocutory applications relate to amendments affected to the
Defendant’s plea.
Background
before any amendments were effected to the particulars of claim and
Defendant’s plea thereto.
[2]
It is common cause that Plaintiff instituted an action against
Defendant seeking judgement in the sum of R2 653 347,05 plus
interest
and costs for goods sold and delivered. After summons was
served, Defendant filed a plea denying liability.
Plaintiff
then amended his particulars of claim by adding
additional/alternative claims in terms of the Close Corporations
Act.
Defendant failed to file a plea to the amendments within
the time periods specified by the Rules of the Court. Only some
time thereafter, Defendant proceeded to file an amendment to his
plea. These amendments give rise to the present applications.
[3]
It is common cause that neither the quantum nor the delivery of the
goods is in dispute. The only dispute relates to Defendant’s
defence that he is not personally liable for the debt to Plaintiff.
Defendant has pleaded that four close corporations through
which he
traded, and which are now dormant are liable to Plaintiff for the
debt.
[4]
It is further common cause:
(a) That Defendant
commenced trading in his own name;
(b) Defendant
applied to Plaintiff for credit in his own name;
(c) That the four
closed corporations never applied to Plaintiff for credit;
(d)
That Defendant failed to produce a single voucher or document in
support of his defence that Plaintiff agreed to trade with
the four
close corporations.
[5]
To complete the background before the amendments were effected, it is
also common cause that Defendant pleaded that an independent
sales
agent, Craig Kourie, whose services are utilised by Plaintiff to
source sales, was aware that Defendant traded through the
four close
corporations. In reply thereto Plaintiff pleaded that Kourie’s
testimony will be to the effect that he was
not so aware.
The
amendments by Plaintiff of its particulars of claim and Defendant’s
failure to file a plea.
[6]
After Defendant has pleaded to Plaintiff’s original claim,
Plaintiff amended his particulars of claim introducing alternative
claims to the main claim which was left unaltered. The
amendment is based on certain statutory provisions contained in the
Close Corporations Act. This amendment was effected on 11
February 2014 and was unopposed.
[7]
It is not in dispute that Defendant had until 20 March 2014 to effect
any consequential adjustment to his plea arising from
the amended
particulars of claim. Defendant failed to file a plea within
the prescribed period dealing with the new issues
raised in the
amendments.
[8]
The failure by Defendant to adjust his plea consequently had the
effect and result that Plaintiff’s alternative claims
were
deemed to be admitted.
[9]
The trial in the main action was set down for hearing on 2 June 2014.
Urgent
Application brought by Plaintiff.
[10]
It is Plaintiff’s contention that at that stage of the
proceedings it was entitled to default judgement against Defendant
based on the alternative claims which were not opposed. In
order to avoid unnecessary wasting of cost in preparation of the
trial, Plaintiff brought a semi-urgent application to this Court,
seeking default judgement against Defendant on the alternative
claims. The Urgent Court held that the matter was not urgent
and struck it from the roll with costs. The trial itself
did
not proceed and was adjourned by agreement. The cost of the
trial was reserved.
Defendant’s
attempt to amend his plea which gave rise to the first interlocutory
application.
[11]
Subsequent to the postponement of the trial, the Defendant sought to
cure his failure to adjust his plea by involving the provisions
of
section 28(1) of the Uniform Rules of Court which are designed to
permit a litigant to effect an amendment to his or her pleading.
On 25 April 2014, Defendant served a notice on Plaintiff in terms of
Rule 28(1), notifying his intention to effectively plead
consequentially to Plaintiff’s alternative claims as set out in
the first interlocutory application. In response thereto
Plaintiff served on the Defendant a notice under Rule 30(2)(b)
calling upon the Defendant to cure an improper or irregular step.
The Plaintiff’s objection is based on the fact that at that
stage of the proceedings the pleadings were closed and that any
amendment to the Defendant’s plea could only be effected by
leave of the Court. The Plaintiff contends that thereafter
the
Defendant, instead of curing the defect by seeking leave from the
Court by way of an application to amend supported by the
necessary
affidavits, proceeded to act as if its Rule 28(1) notice had been
complied with and purported to effect an amendment
to his plea by
serving “amended pages”.
The
second interlocutory application
[12]
Subsequent thereto Defendant then attempted to effect an amendment to
his first attempt at an amendment and proceeded to do
so as if he
could do so again using the provisions of Rule 28(1) of the Uniform
Rules of Court. Once again Plaintiff served
a Rule 30(2)(b)
notice on Defendant calling upon the Defendant to cure what Plaintiff
considered to be an improper or irregular
step. Defendant
ignored the Rule 30(2)(b) notice and purported to effect a second
amendment to his plea by serving “amended
pages”.
This lead to the second interlocutory application brought by the
Plaintiff.
[13]
This then resulted in Plaintiff launching the two interlocutory
applications in terms of Rule 31(1) read together with Rule
30(2)(c)
in respect of each of Defendant’s attempts to amend his plea by
using the provisions of Rule 28(1).
[14]
The crisp issue to be determined in both interlocutory applications
is whether the procedure followed by the Defendant to effect
an
amendment to his pleadings can be sustained. For purpose of
this judgement I find it unnecessary to deal with the issues
raised
in the urgent application as the legal issue to be determined is not
dependant on whether a specific party is deliberately
stalling the
process or not. The only issue is what procedure is applicable
to amend a pleading where a Defendant failed
to file a plea after a
new cause of action has been introduced to a Plaintiff’s claim
by way of amendment to his particulars
of claim.
[15]
It is common cause on the papers that pleadings were closed on 20
March 2014. Rule 29(b) of the Uniform Rules of Court
provides
pleadings shall be considered closed:
‘
(a)
. . .
(b)
if the last day allowed for filing a replication or subsequent
pleadings elapsed and it has not been filed’.
[16]
In terms of Rule 22(2)(a) of the Uniform Rules of Court a Defendant
is required to either admit, deny or confess and avoid
all material
facts alleged in a summons or declaration. If a Defendant fails
to comply with the provisions of Rule 22(2)
this failure will be
deemed to constitute an admission of the facts alleged by the
Plaintiff.
[17]
In the present instance, Defendant failed to serve a plea to the
amended claim within the specified period stated in Rule 25.
Rule 26 of the Uniform Rules of Court provides that any party who
fails to deliver a replication or subsequent pleading within
the time
stated in Rule 25 shall be ipso facto barred.
[18]
The Defendant contends that he delivered a notice of intention to
amend his plea in terms of Rule 28(1) dated 25 April 2014
and served
it on Plaintiff on 25 April 2014. The Defendant contends that
this entitled him to amend his plea without obtaining
leave to amend
from the Court. Plaintiff did not object to the notice of
amendment in terms of Rule 28(3) but delivered a
notice in terms of
Rule 30(2)(b) to the effect that the Defendant had, by delivering its
notice of intention to amend, taken an
irregular step in the
proceedings. No notice was received in terms of Rule 28(2) from
the Plaintiff and Defendant accordingly
effected the amendment in
terms of Rule 28(5). The Plaintiff thereupon and in return
delivered a further Rule 30(2)(b) notice
consequent upon Defendant
effecting the amendment.
[19]
Defendant contends that Defendant was compelled to respond to
Plaintiff’s amended particulars of claim in compliance
with
Rule 28(8).
[20]
Plaintiff’s contention is that:
(a) Defendant is
precluded from making any amendment of his plea consequent and in
response to the Plaintiff’s amendment of
the particulars of
claim in terms of Rule 28(1) by virtue of the provisions of Rule
28(8), and;
(b)
Any amendment involving the withdrawal of an admission
must
be done by way of application
accompanied by an affidavit.
[21]
Before me Defendant’s counsel argued that Rule 28(8) is not
peremptory and merely states that a party affected by any
amendment
may, within 15 days after the amendment has been effected, make any
consequential adjustment to the document filed by
him.
The
word “
may
”
is indicative that the party concerned has the choice as to whether
or not he intends adjusting the documentation as filed,
or not.
The question then arises if by choosing to not adjust his documents,
he is in perpetuity barred from doing so.
Defendant contends
that a direct consequence of the use of Rule 28(8) to respond to the
other party’s amendment, is to make
the adjustment simpler, in
that the procedures in terms of Rules 28(1) 28(2), 28(3), 28(4) and
28(5) do not have to be followed.
Therefore, the effect of this
is that if one party brings an amendment in terms of Rule 28(1) which
is duly effected, the other
party has an automatic right to follow
the simple procedure set out in Rule 28(8) to respond thereto by
bringing a consequential
adjustment it may deem necessary in the
circumstances. Defendant further contends that the party
effecting the original amendment
has no right to object to that
amendment in terms of Rule 28, although such party will obviously be
entitled to object inter alia
on the grounds of exception et cetera.
[22]
Defendant further contends that Rule 28(8) precludes the use of Rule
28(1). Rule 28(1) contains no time limits to a party
and only
requires from a party desiring to amend a pleading or document other
than a sworn statement, filed in connection with
any proceedings,
shall notify all other parties of his intention to amend and shall
furnish particulars of the amendment.
Subrule 28(2) requires
from a party who intends to amend to state in its notice that unless
written objection to the notice of
the proposed amendment is received
within 10 days of delivery of such notice, the amendment will be
effected. Subrule 28(3)
requires that the grounds for the
objection shall be clearly and concisely stated. Subrule 28(4)
provides that if an objection
complying with subrule 28(3) is
delivered within the time period referred to in subrule 28(2), the
party wishing to amend may,
within 10 days, lodge an application for
leave to amend. Subrule 28(5) provides that it no objection is
delivered as contemplated
in subrule 28(4) every party who received a
notice of the proposed amendment shall be deemed to have consented to
the amendment.
Thereafter the party who gave notice of the
proposed amendment may, within 10 days after the expiration of the
period mentioned
in subrule 28(2), effect the amendment as
contemplated in subrule 28(7).
[23]
Defendant submits that the provisions of Rule 28(1) have to be read
with the provisions of Rule 28(2), (3), (4) and (5).
If a party
objects to a proposed amendment, Rule 28(4) applies, namely that an
application for leave to amend will have to be brought
by the party
wishing to amend. Defendant contends that Plaintiff failed to
file an objection in both applications and therefore
Defendant was
entitled to give effect to the proposed amendment in terms of Rule
28.
[24]
At the heart of the Defendant’s contentions lies the
proposition that it is open to a defendant to use the provisions
of
Rule 28(1) to effect any consequential pleading. The Defendant
accepts that the failure to plead consequentially in a
plea results
in a deemed admission, he (the Defendant) is still entitled to give
notice under Rule 28(1) and only if the Plaintiff
objects to the
Defendant doing so will the Defendant be obliged to bring an
application, supported by affidavit, to seek leave
to amend from the
Court. This ostensibly, on the basis that the Uniform Rules
themselves do not require an application supported
by affidavit, when
an admission is sought to be withdrawn.
[25]
In reply thereto Plaintiff’s counsel argued that neither of
these contentions has any merit for the following reasons.
Firstly, if a litigant could with impunity utilises the provisions of
Rule 28(1) of the Uniform Rules of Court, to effect a consequential
pleading and to do so at any time before judgement, there would be no
purpose in Rule 28(8) providing that any consequential pleading
must
be effected within 15 days of any amendment effected by another
litigant. It would render that 15 day window simply
nugatory
and goes against the established principle of interpretation which
requires that every word and expression be given meaning
and that
they not be considered to be superfluous. The 15 day period
mentioned in Rule 28(8) for effecting a consequential
amendment
implies that if the 15 day period is not adhered to, it is necessary
for a litigant to apply to Court for a longer period.
The
expressed time set to effect the amendment cannot be ignored and,
with impunity and without leave of the Court, simply
effect a
consequential amendment. Furthermore Rule 28(1) of the
Uniform Rules of Court allows for the effecting of
amendments “to
pleadings” whereas Rule 28(8) allows for “consequential
adjustments” to pleadings.
A consequential adjustment is
an adjustment to pleadings and not an amendment. No amendment
can be effected without a notice
first being served on the other
litigant in terms of Rule 28(1) and setting out an invitation to the
other litigant to object thereto.
In sharp contrast and
contradistinction, the Rules Board has provided that when an opposing
litigant has successfully effected
an amendment, the other litigant
is not required to serve notice of any intention to intentionally
adjust his or her pleading but
may do so with impunity within the
window period provided therefore.
[26]
The real dispute between the parties is whether the Defendant is
entitled to amend his plea in terms of the provisions of Rule
28(1)
when his previous failure to plea to plaintiffs amended particulars
of claim constituted a deemed admission of the facts
contained in the
amended alternative claims.
[27]
In order to determine this dispute two different and independent
issues must be considered. The first issue is when and how
can a
deemed admission of the alternative claims be withdrawn by a
defendant who failed to adjust or failed to amend its plea during
the
time period (i.e. 20 March 2014) referred to in the pleadings.
It is common cause that the admission referred to in this
matter is a
so-called ‘deemed’ admission, i.e. the Defendant has not
in fact made the admissions but has been deemed
to have done so by
his failure to file a plea within the prescribed period to the
amended claim. It is trite law in the case
of an application
seeking to withdraw an admission, such application will have to be
accompanied by an affidavit setting out the
grounds for the
withdrawal of such an admission. See
Erasmus
Superior Court Practice, Rule B-1 p178
and p182 paragraph (f). In my view this principle applies to
both actual and deemed
admissions. Admissions c
[28]
In
Swartz v Van der Walt t/a Sentratem
1998 (1) SA 53
(W) at
56 I – J and 57 G – J Claassen J examined the provisions
of Rule 28(4) which reads as follows:
‘
28(4)
If an objection which complies with subrule (3) is delivered within
the period referred to in subrule (2) the party wishing
to amend may
within 10 days
lodge an application for
leave to amend
(own emphasis)’.
Claassen
J concluded on page 55(j) that it is therefore necessary to decide
whether or not the words ‘lodge an application’
used in
the ‘new’ Rule 28(4) denote the use of the formal notice
of motion procedure laid down in Rule 6(1), and at
p56 he concluded:
‘
The
question is however, whether or not a particular form of application
is laid down in the “new” Rule 28(4): To my
mind it is
not. It simply provides that an application may be lodged for
leave to amend the pleadings. The wording
is analogous to the
wording found in Rule 6(15) which also deals with particular kind of
interlocutory application i.e. to strike
out scandalous, vexatious or
irrelevant material in affidavits.
Rule 6(15) states
that:
“
The
court may on application order to be struck from any affidavit any
matter which is scandalous, vexatious or irrelevant…”.
As
will be noted the latter subrule merely uses the words an
application. These words are, in my view, similar to the words
used in the new Rule 28(4) i.e. “lodge an application”’.
In
my view the words used in Rule 28(4), i.e. ‘lodge an
application’, cannot in the context of an amendment, which is
by nature an interlocutory application, denote an intention on the
part of the legislator that the formal notice of motion procedure
supported by an affidavit contemplated in Rule 6 should be adopted.
The
Judge then went on stating a number of reasons for his conclusion.
[29]
I am not going to refer to all the reasons relied upon by Claassen J
except the
very
first reason where he says the following at 57
A – C:
‘
Amendments
to pleadings can be of a wide variety. Some are simple and purely
formal in nature, ie to amend arithmetical and clerical
errors in
pleadings. Other amendments may be more substantial, for example
amendments seeking to withdraw an admission made on
the pleadings. It
is trite law that amendments constituting the withdrawal of an
admission have to be done on affidavit. However,
it would, in my
view, be absurd to interpret the new Rule 28(4) as prescribing the
use of the Rule 6 procedure in all cases of
applications for leave to
amend pleadings. In cases where a mere word or figure requires
amendment, it would be totally absurd
to file a notice of motion
supported by an affidavit to secure such amendments. Affidavits would
only be necessary in more substantial
amendments, such as the
withdrawal of admissions.’
[30]
It is clear from Claassen J’s judgement that admissions can
only be withdrawn on affidavit. In such instances the
procedure
regarding amendments to pleadings set out in Rule 28 does not apply.
Section 15 of the Civil Proceedings Evidence
Act, no. 25 of 1965,
provides that:
“
It
shall not be necessary for a party in any civil proceedings to prove,
nor shall it be competent for any such party to disprove
any fact
admitted on the record of proceedings.”
In
the present matter, and in the absence of evidence explaining the
circumstances under which the admission was made, leave will
not be
given to withdraw the admission. See
Sliom
v Couzyn
1927 TPd 438
at 441.
[31]
It is abundantly clear from what is said above, that not all
amendments as contended by the Defendant, can be done in terms
of
Rule 28. In the present instance the defendant failed to file a
plea to the amended particulars of claim. If no
plea is filed,
no amendment can be made as there is nothing to amend. The
Defendant’s notice to amend in terms of Rule
28(1) amounts to
the initiation of “fresh proceedings” as envisaged by
Rule 6. See in this regard
Yorkshire
Insurance Co Ltd v Reuben
1967 (2) SA
236
(E) at 265. The application to amend further amounts to a
substantial amendment in that the defendant not only tried to
withdraw
an existing admission but also introduced a plea where no
plea was filed in regard to the amended portion of the particulars of
claim.
[32]
I agree with the judgment of Rampai J in
Shell
SA Marketing v Wasserman
2009 (5) 212
at 217 (OPD) para 26. Similarly, in the present instances, no
plea was filed in regard to the amended particulars
of claim and no
amendment can be effected thereto unless with the leave of the
Court. The provisions of Rule 28 cannot be
construed to amend a
plea which does not exist.
[33]
The plaintiff gave proper notice to the defendant prior to effecting
the amendments in terms of the provisions of Rule 30(2)(b)
setting
out its objection to the proposed amendment. The defendant
failed to heed to these objections. After the plaintiff
served
its first notice on defendant to cure what plaintiff considered to be
an improper or irregular step taken by Defendant,
Defendant proceeded
to act in terms of Rule 28(1) as if the defendant’s notice had
been validly effected, whereafter “amended
pages” were
served on plaintiff. Subsequently thereto the defendant then
attempted to effect an amendment to his first
attempt at an amendment
and proceeded to do so as if he could do so using the provisions of
Rule 28(1) of the Uniform Rules of
Court. Once again plaintiff
served a Rule 32(2)(b) notice on the Defendant calling upon the
defendant to cure an improper
or irregular step. Defendant
again ignored the Rule 32(2)(b) notice and purported to amend his
plea by serving a second amendment
to his plea by serving amended
pages. This caused the plaintiff to launch the interlocutory
application in terms of Rule
30(1) read together with Rule 30(2)(c)
in respect of each of these purported attempts by Defendant to amend
his plea in terms of
Rule 28(1).
[34]
Both notices of objection sent by Plaintiff to the Defendant clearly
sets out the basis for its objection, firstly that
defendant
failed to plea consequently to Plaintiffs amended particulars of
claim and was barred from doing so, and secondly, that
defendant is
taken to have admitted the contents of plaintiff’s amendment as
he failed to plead consequently thereto.
Furthermore,
Defendant’s attention was specifically drawn to the fact that
the amendments Defendant is seeking in terms of
Rule 28(1) amounts to
an irregular or improper step as it amounts to a withdrawal of the
admission without leave of the Court.
[35]
The Defendant clearly out of convenience placed form above substance
and disregarded the Rule 30 notices spelling out in detail
the
plaintiff’s objection to each proposed amendment. In
effect plaintiff repeatedly invited the defendant that if
defendant
wants to consequentially adjust his plea to deal with plaintiffs
alternative plea then defendant should do so by way
of an application
supported by affidavit.
[36]
In view of what I have said before, the plaintiff must succeed in its
application and is entitled to an order as set out in
the notices of
motion. Before granting the order; I have to consider the costs
involved. Plaintiff is represented by
senior and junior
counsel. Although punitive costs are sought by plaintiff I am
not persuaded that this matter deserves a
punitive cost order.
Having regard to the conduct of the defendant in this matter the
employment of two counsels was not
a luxury but a necessity.
The defendant has sought to be very technical and overly formalistic
and this required research
and unpacking of the Rules and the
authority.
Consequently
I am satisfied and notwithstanding opposition by the Defendant,
Plaintiff is entitled to costs including the cost of
two counsel.
I
THEREFORE MAKE THE FOLLOWING ORDER:
In
both interlocutory applications under Case No 39677/2011:
1.
Defendant’s notices of intention to amend, served on the
Plaintiff on 25 April 2014, together with any and all documents
served on the Plaintiff pursuant thereto, is hereby set aside on the
grounds that such notices constitute an irregular or improper
step as
contemplated by Rule 30 of the Uniform Rules of Court
and/or such documents are declared a nullity;
2.
The Defendant, to the extent that it wishes to make the amendment
which it purported to do in terms of its notices of intention
to
amend served on Plaintiff on 25 April 2014, is directed to bring an
application supported by affidavit within 10 days of the
grant of
this order, failing which the Defendant is precluded, save with
leave of the Court from doing so.
3.
The Defendant is ordered to pay plaintiff’s costs for both
applications including the cost of two counsel.
_________________________
DE
VOS J
JUDGE
OF THE GAUTENG
DIVISION
OF THE HIGH COURT