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[2015] ZAGPPHC 253
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A.G. Formwork & Scaffolding (Pty) Ltd v FVN Projects CC and Another (72107/2014) [2015] ZAGPPHC 253 (17 April 2015)
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE NO:
72107/2014
DATE: 17 APRIL
2015
In the matter
between:
A.G
Form work & Scaffolding(Pty)
Ltd
........................................................................
Plaintiff/Applicant
and
FVN
Projects
CC
.............................................................................................
First
Respondent/Defendant
Frans Petrus Van
Niekerk
..........................................................................
Second
Respondent/Defendant
JUDGMENT
CORAM: PHATUDI
AJ:
[1] INTRODUCTION:
1.1
This is an opposed application for Summary Judgment against the First
and Second Defendants sued, jointly and severally, for
payment of the
amount of R432 868.26 being for rental of the scaffolding up to the
period including April 2014, together with 15.5%
interest per annum
a
temporae morae
,
and
costs of suit.
1.2 On 19
th
February 2015, I made an Order granting Summary Judgment in favour of
the Plaintiff against the Defendants jointly and severally,
the one
paying the other to be absolved, as prayed for in the Notice of
Application.
1.3 The Defendants
have since delivered a notice on 04
th
March 2015, seeking
written reasons for the Order I made on 19
th
February
2015.
1.4 What follows are
the reasons and a summary of the factual backround that gave rise to
the Order made.
[2]
The Plaintiff("the applicant") issued a Combined Summons in
this Court on 24
th
October 2014 against the Defendants("the respondents")
seeking payment of the amount of R432 868.26, being for rental
of the
scaffolding up to and including April 2014, together with interest
thereof at 15.5% per annum a
temporae
morae
from
the date of summons, until date of final payment and costs of
1
suit.
A
notice of intention to defend the action was delivered on the
plaintiff's attorneys on 25
th
November 2014. The Plaintiff subsequently brought a notice of
application for Summary judgment on 04
th
December 2014 which was served on the defendant's attorneys on 12
th
December 2014
2
.
The defendant delivered an opposing affidavit resisting the relevant
application on 14
th
January 2015. The application was set down for hearing on 17
th
February 2015.
[3] The application
for Summary Judgment was predicated on the provisions of Rule 32(1)
of the Uniform Rules of Court("the
Rules") which provides
that:
Rule 32(1):
"Where the
defendant has delivered a notice of intention to defend, the
Plaintiff may apply to Court for Summary Judgment on
each of such
claims in the Summons as is only -
(a).....
(b) for a liquidated
amount in money
(c)
...
(d).................................
In the present
instance, the Plaintiff's cause of action arose during the period
June 2013 up to and including October 2013. The
particulars of claim,
paragraph 8 in particular recites:-
"During the
period of June 2013 up to and including October 2013 the Plaintiff
provided to the First Defendant, at the First
Defendant's request,
with scaffolding to be utilized by the First Defendant at a site
situated in Lanseria.......- The scaffolding
was provided to the
Defendant by the Plaintiff subject to the terms and conditions agreed
to between the parties. Copies of the
respective delivery notes
issued to the First Defendant by the Plaintiff are attached hereto as
Annexure "C"".
[4]
It was further alleged in Paragraph 8 thereof that the First and
Second Defendants had in its/his possession and under its/his
control
scaffolding of the plaintiff consisting of the items and quantities
as listed in Annexure "D" attached
3
thereto. The contents of Annexure D were to be read as if
specifically pleaded.
The items in
Annexure D were in defendants' possession as from June 2013 to 31
st
October 2013, when the scaffolding was returned to the Plaintiff.
Furthermore, the
monthly rental due to the plaintiff by the First Defendant for the
scaffolding in terms of the said agreement,
amounted to R432 868.26
per month for which certain invoices were issued(Annexure "E")
for payment.
[5].
It was also alleged that as at 11
th
April 2014, the First Defendant was indebted to the plaintiff in the
amount of R432 868.26, which amount become owing, due and
payable to
the plaintiff as per Annexure "F" attached to the
particulars of claim
4
.
The amount owed was reduced by part payment already made by the
Defendant/s prior to the issuing of Summons.
[6].
In terms of Paragraph 9.5 of the particulars of claim the liability
of the Second Defendant was that of a "surety for
and
co-principal debtor
in
solidum"
with
First Defendant
5
.
Paragraph 11 of Annexure "A" at pl8 specifically
incorporated a Suretyship Clause which invariably bound the Second
Defendant personally as "surety for and co-principal debtor"
for the due and proper discharge of all such customer's
obligations
to the company,
in
casu
.
the
First Defendant. This suretyship was signed by the Second Defendant
on 10
th
October 2012.
The
terms and conditions of hire were set out in Annexure "B"
6
,
attached to the Summons.
[7] Adv. Van der
Merwe, Counsel for the applicant, submitted that the crux of the
parties' relationship arose from the written contract
being for goods
and services provided to the First Defendant. The goods referred to
were scaffolding provided by the plaintiff
to First Defendant, for
which Second Defendant assumed liability as a Surety and co-principal
debtor.
He submitted that
the First Defendant defaulted in its obligations towards the
Plaintiff in that it failed to pay an amount of R432
868.26 to the
Plaintiff for the use of scaffolding for the period June 2013 to
October 2013, after certain invoices were issued
for payment on due
dates.
[8]
In resisting the application, Counsel for the respondent Adv. Jacobs,
raised a point
in
limine
,
contending
that the applicant has failed to comply with the provisions of
Section 129 and 130 of the National Credit Act("the
NCA")
7
.
He contended further that in terms of the NCA the type of agreement
the parties concluded fell within the ambit of the definition
of the
so-called "incidental agreements" which according to him,
are regulated by Section 5(1) of the NCA and matters
incidental
thereto.
In addition, Counsel
contended that Section 129-133 of the NCA forms part of Chapter 6 of
the said Act, and therefore the required
notices as envisaged in
Sections 129 and 130 of the NCA, were not dispatched prior to the
issuing of the Summons thereby rendering
the Summons premature. I
propose to return to this submission in the course of this Judgment.
[9]
It was contended further on behalf of the respondent that as the
claim against the Second Respondent's liability was that of
a Surety
and co-principal debtor, he was not aware that Clause 11 of Annexure
"A", being "an application for account
facilities and
deed of suretyship" signed on 10 October 2012, in fact bound him
as surety and, therefore, became personally
liable as such
sinauli
in sofidum
with
the First Respondent. In binding himself as surety, he also agreed to
renounce the benefits of exclusion and division with
the free meaning
and effect whereof he declared to be perfectly acquainted. He in fact
relied on
iustus
error
as
a defence.
[10]
I find no substance in this contention. The plain language used in
Clause 11 of Annexure "A", is not only unambiguous,
but
lacks complex legal parlance, to say the least. Accordingly, to
contend that the Second Respondent was not aware that he was
acting
as Surety for and co-principal debtor with First Respondent, is
tantamount to clatching at a straw. Assuming for a moment
that the
Second Respondent was actuated by reasonable erro
r(iustus
error)
for
having acted to his detriment, as to why from June 2013 to October
2013, as the applicant continued to provide to First Defendant
the
goods delivered, did Second Defendant not seek to resile from the
contract, is another question.
[11]
In reply, Mr Van der Merwe for the applicants submitted
inter
alia
that:
10.1 the NCA does
not apply to the nature and type of the credit agreement the parties
have entered into. In this instance, the
First Respondent is a Close
Corporation and, therefore, a juristic person, alternatively,
10.2 The credit
agreement the parties concluded, of which the First Respondent is a
juristic person, was in respect of a principal
debt in excess of R300
000.00 and the NCA is, therefore, not applicable to the debt under
the credit agreement, and that the First
Respondent is a "small"
entity with an asset value or annual turnover of less than R1 million
in respect of the small
or intermediate credit agreement.
10.3 Further
alternatively, in view of the fact that the principal debt in dispute
and as claimed in the summons is an amount of
R432 868.26, the NCA
finds no application, and correspondingly Sections 129 and 130 of the
NCA were unnecessary as between the
parties dealing at arms' length.
[12]
LEGAL FRAMEWORK
APPLICABLE FOR PURPOSES OF SUMMARY JUDGMENT IN NCA MATTERS:
11.1
A party who seeks to resist an application for Summary Judgment is
required to deliver an opposing affidavit disclosing fully
the nature
and grounds of the defence("bona fide defence") and the
material facts on which it is based
8
.
Put
differently, the defendant must depose to facts that, if accepted as
the truth or proved at the trial, with admissible evidence,
would
constitute a defence to the plaintiff's claim
9
.
Such an affidavit need not be laconic nor ambiguous or fail to
canvass matters critical to the defence raised.
11.2 As already
indicated, the defendants placed considerable reliance on
non-compliance by the plaintiff with sections 129 and
130 of the NCA.
In view of the provisions of the NCA limiting the liability in
certain specified instances, in particular, Sections
4(l)(a)(i),
Section 4(l)(b), Section 6 and Section 7(1) of the NCA, I am inclined
to subscribe to the submissions advanced on behalf
of the applicant
that as the relevant provisions referred to are not applicable to the
First defendant/respondent, Sections 129
and 130 of the said Act were
considered unnecessary before summons could be issued. The Second
Defendant, needless to say, entered
the picture merely on account of
his status as surety for an co-principal debtor jointly and severally
with the First Defendant.
11.3
There is a growing tendency since the gradual introduction in our law
of the provisions of the NCA, where in many cases the
defendants have
opposed summary judgment applications not by raising a
bona
fide
defence
to the allegations of indebtedness in respect of the claim, raising
for instance, technical defences ranging from non-compliance
with the
NCA provisions to alleged "over-indebtedness" seeking debt
counsellor intervention. In my view, such technical
defences in the
absence of a
bona
fide
defence
to the action raised, should not eclipse the purpose of Summary
Judgment applications.
11.4
The courts of the land have reiterated over and over again that the
purpose of summary judgment is to assist a plaintiff where
the
defendant who cannot formulate a
bona
fide
defence
or raise a triable issue, enters appearance to defend solely for the
purpose of delay.
Vide: Meek v
Kruger 1958(3)SA 154(T) at 159H- 160A
11.5
Turning to the facts of this matter no where in its opposing
affidavit did the Respondents establish a
bona
fide
defence
to the claim. Instead, in its Supplementary Opposing Affidavit dated
11
th
February 2015 as deposed to the Second Respondent on behalf of the
First Respondent, the defendants dismally failed to advance
a
defence, and worse still, the defendants
ex
post facto
.
better
described as an afterthought in paragraphs 4(4.1-4.5) again failed to
raise a genuine defence while in the same vein, do
not dispute the
existence of the rental agreement. If indeed a meeting ever took
place between Messrs De Beer and Van Niekerk in
Midrand purporting to
vary the terms and conditions of the rental of scaffolding, it
remains obscure as to why an Addendum or variation
agreement signed
by the parties has not been attached to the Supplementary Opposing
Affidavit referred to.
11.6
In the facts analogous to the present matter, the Court in an
unreported Judgment per Monama J
10
,
dealt briefly with the application or otherwise of Section 129 Notice
vis-a-vis a juristic person and stated: [Para: 12+13]
PARA 12:
“
It
is common cause that the first defendant is a juristic person and
that the plaintiff did not comply with the procedure of
Section 129
of the
National Credit Act 34 of 2005
, as amended. It is also common
cause that the main agreement is between the plaintiff and the first
defendant, and that the transaction
between the parties is a credit
transaction. The second and third defendants are co-principal debtors
in terms of their suretyship
agreements.
The
National Credit
Act applies
to every credit agreement except agreements specified in
Section 4
thereof"
PARA 13:
“
The Plaintiff
contends that the said provisions do not apply and the notice in
terms of
Section 129
of Act 34 of 2005("NCA") was
unnecessary. The second and third respondents are mere "guarantors".
Therefore,
the second and third defendants cannot rely on the said
provisions. They are not the "customers" within the meaning
of
the Act. The Act does not apply to the sureties. Accordingly, this
argument is devoid of any merit and must be rejected".
11.7 I find myself
wholly in agreement with the dictum stated by the learned Judge in
the foregoing passage, and the reasoning thereof
cannot be faulted
either.
11.8 Following the
statement of the law as pronounced, and applying the facts which as I
have remarked are analogous to the facts
in the present instance, I
do not hesitate to arrive at the conclusion that, the Order granting
summary judgment handed down on
19 February 2015, is hereby
confirmed.
M.G PHATUDI
ACTING JUDGE,
GAUTENG
DIVISION,
PRETORIA
APPEARANCES:
1. Counsel for the
Plaintiff: Adv. L.K vd Merwe
Instructed by: Kemp
De Beer &
Goosen
Attorneys
690 Ella Street,
Pretoria
2. Counsel for
Defendants: Adv. M.Jacobs
Instructed by: WWB
Botha
Attorneys
446 Cameron Street,
Pretoria
3. Date heard: 19
February 2015
Date
of Judgment: 17 April 2015
1
Pp
3-14, Particulars of Claim, read with Annexures A-F, Bundle.
2
Pp
55-56, Index to Bundle
3
P40,
paginated Bundle
4
Annexure
F, P55, Paginated Bundle
5
Annexure
A
,
PI 5 paginated Bundle
6
P20,
paginated Bundle
7
Act
34 of 2005
8
Rule
32(3)(b), Uniform Rules of Court, see also, Maharaj v Barclays
National Bank Ltd 1976(1) SA 418(A) at 423, and Central News
Agency
Ltd v <6illiers 1971(4) SA 351(NC)
9
Standard
Bank of SA Ltd v Friedman 1999(2)SA 456(c) at 462 G.
10
First
Rand Bank Ltd t/a Wesbank v Ego Specialised Services cc & Others
[Case NO. 47925/2011] SGC delivered on 03.04.2012(marked
“Reportable”)