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[2015] ZAGPPHC 418
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Sheriff of the High Court Johannesburg South v Kalala; In Re: Standard Bank of South Africa Ltd v Nsele and Others (22740/2013) [2015] ZAGPPHC 418 (11 May 2015)
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THE
HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
CASE NO: 22740/2013
DATE
OF HEARING: 11 MAY 2015
In
the matter between:
THE SHERIFF OF THE HIGH COURT
JOHANNESBURG
SOUTH
Applicant
and
MOTSOANA
YVONNE
KALALA
Respondent
Passport Number [……..]
In Re:
THE
STANDARD BANK OF SOUTH AFRICA
LTD
Plaintiff
CELOKUHLE
PHUNELELE FORTUNATE
NSELE
First
Defendant
Identity Number [……..]
XOLILE
PORTIA
NSELE
Second
Defendant
Identity Number [……..]
JOYCE THANDI MHONI
Identity Number
[……..]
Third Defendant
JOYCE THANDI MHONI
Identity Number
[……..]
Fourth Defendant
In her capacity as Executrix
in the estate late
JAMES
CHIKOSA MHONI
J U D G M E N T
AVVAKOUMIDES,
AJ
INTRODUCTION
AND SUMMARY OF FACTS
1.
The
plaintiff obtained judgment against the defendants pursuant to
non-payment of the monthly payments in respect of a mortgage
bond
resulting in the sale in execution of the property in issue, namely
Portion 1 of Erf […..] Township, Registration Division
I. R.,
Province of Gauteng, also known as [……].
2.
The
sale in execution took place on 18 February 2014 and was sold by the
applicant to the respondent. In terms of the conditions
of sale the
property would be sold to the highest bidder and the purchaser would
pay a 10% deposit upon signature of the conditions
of sale.
3.
The
respondent duly paid the 10% deposit but failed to furnish guarantees
for the balance of the purchase price within 21 days of
the date of
sale. The conditions of sale do not contain a notice period within
which the applicant would call upon the respondent
to remedy a
breach. The applicant however, upon the respondent’s breach,
despatched a letter of demand to the respondent,
calling upon the
respondent to provide the guarantees within 7 days. This letter of
demand was not reacted to and the applicant
despatched a further
letter in which the respondent was advised that the sale would be
terminated. Both letters were sent by registered
post. The applicant
was thus obliged to proceed in terms of the provisions of rule 46
(11).
4.
The
practice directive of this division provides that if an application
in terms of rule 46 (11) is unopposed it will serve before
a judge in
chambers. If the application is opposed it is heard in open court.
The applicant brought the application on affidavit,
as required
and the respondent opposed the application alleging therein, in
limine, that the application was initiated by the plaintiff
and not
by the applicant (whatever that may mean). Furthermore the respondent
stated that she denies being in breach of the conditions
of sale but
did not expand hereon at all. There is no indication is the answering
affidavit that guarantees were delivered and
the affidavit does not
set out anything whatsoever to indicate that the relief sought ought
not to be granted.
5.
Moreover
the answering affidavit was signed by the respondent but not
commissioned at all. The answering affidavit must therefore
be
disregarded for this reason alone. However, because of the apparent
importance of the matter to the respondent and because the
application involves immovable residential property I have deemed it
fit to ensure that the applicant is well within its rights
to be
granted the relief sought, despite the absence of the answering
affidavit and the non-appearance for the respondent.
6.
Before
the hearing I requested my registrar to telephone the respondent’s
attorneys, as appears on the papers filed, to remind
them of the date
and time of the application. The telephone number listed on the
papers filed is not that of the respondent’s
attorneys. The
application proceeded thus in open court.
7.
Counsel
for the applicant could not point out a clause in the conditions of
sale entitling the applicant to retain the deposit paid
by the
respondent, ex facie the document. He submitted though that the
conditions of sale provide for payment by the respondent
of all
losses incurred by the applicant upon a breach by the respondent.
He referred me to the case of The Sheriff v Mashaba
1948 (4) SA 870
(T) wherein it was held that the sheriff could not utilise the
deposit to offset the wasted costs and losses. This case followed
the
case of Sheriff v Gillingham
1907 TS 190.
I was also referred to the
case of The Sheriff v Jaithoon
1955 (3) SA 416
(N) wherein Holmes J
(as he then was) held the complete opposite that, insofar it
pertained to the practice in then Natal, the
deposit could be
allocated towards the payment of costs.
8.
In
Sheriff of the High Court, Johannesburg South v Sithole and Three
Similar Cases
2013 (3) SA 168
(GSJ), Spilg J held, with reference to
the provisions of rule 46 (11) (b) that the sub section does not
sanction forfeiture on
breach. On the contrary the sub section
expressly circumscribes the extent of liability pursuant to default
and stipulates how
it is to be determined. Spilg J further held
that the sub section was complemented by rule 46 (8) (a) (i) which
requires
that the conditions of sale in execution of immovable
property comply substantially with Form 21 of the First Schedule.
Clause
6 of Form 21 provides for payment of 10% deposit on the date
of sale, while clause 8, which is the operative provision dealing
with the consequences of cancellation due to a breach by the
purchaser, makes no reference to forfeiture (nor does any other
clause),
but provides:
“
8
If the purchaser fails to carry out any of his obligations under the
conditions
of sale, the sale may be cancelled by a judge summarily on
the report of the sheriff after the due notice to the purchaser, and
the property may again be put up for sale; and the purchaser shall be
responsible for any loss sustained by reason of his default,
which
loss may. On the application of any aggrieved creditor whose name
appears on the sheriff’s distribution account, be
recovered
from him under judgment of the judge pronounced summarily on a
written report of the sheriff, after such purchaser shall
have
received notice in writing that such report will be laid before the
judge for such purpose; and if he is already in
possession of
the property, the sheriff may, on seven days’ notice, apply to
a judge for an order ejecting him or any person
claiming to hold
under him therefrom”
9.
Consequently
a forfeiture provision is invalid. Neither rule 46 (11) (b) nor the
standard conditions of sale contained in Form 21
permit forfeiture of
the deposit. They however do not expressly provide for the retention
of the deposit, pending the court’s
determination, under rule
46 (11) (b), of the losses for which the defaulting purchaser should
be liable. Nonetheless the rule
contemplates an expedited
determination of losses which are readily ascertainable and therefore
liquidated.
10.
This
brings me to the question of costs of this application. The
respondent chose to oppose the application and filed a notice of
intention to oppose and an affidavit purporting to be an answering
affidavit, notwithstanding the absence of commissioning thereof.
Under the circumstances the applicant could not have brought the
application before a judge in chambers and was obliged to bring
the
application in open court. In my view and for this reason, the
respondent ought to pay the costs of this application.
11.
In
the circumstances I make the following order:
11.1 The sale in execution on 18
February 2014, of the immovable property described as Portion 1 of
[……]
Township, Registration Division I. R., Province of
Gauteng, measuring 273 (two hundred and seventy three) square metres
and held
under Deed of Transfer No T3932/2009, subject to the
conditions therein contained and also known as […….]
(“the
property”), is hereby cancelled.
11.2 The property may again be
put up for sale in execution in accordance with clause 10 of the
conditions of
sale.
11.3 The deposit shall be
retained by the sheriff in trust until the quantification of loss
sustained and judgment
have been granted in respect thereof in terms
of rule 46 (11) (b).
11.4 The written report required
under rule 46 (11) (b) shall be laid before the presiding judge
(Avvakoumides
AJ) or any other judge in chambers by no later than 30
June 2015, failing which an affidavit explaining why such written
report
could not be so laid and indicating by when such report can be
laid before the presiding judge.
11.5 The respondent is ordered
to pay the costs of this application.
________________________________
AVVAKOUMIDES, AJ
JUDGE OF THE HIGH COURT
Representation for the Applicant:
Counsel
Adv: C. G. V. O. Sevenster
Instructed by
Vezi De Beer Inc.
Representation for Respondent:
Counsel
No appearance
Instructed by:
No appearance