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[2015] ZAGPPHC 1152
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Ex Parte Reggioro and Others (66537-14; 21414-15; 23068-15; 23076-15; 25733-15; 25741-15; 39697-145; 23403-15) [2015] ZAGPPHC 1152 (8 August 2015)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
Reportable:
Yes
Of
interest to other judges: Yes
In
the ex parte application for the
voluntary
surrender of the estate
of:
CASE
NO:
TANYA
IRIS
REGGIORO
66537
/14
Identity
No: […]
DANIELLE
ROBINSON
21414
/15
Identity
No: […]
YOLISWA
ARETHA
MAGCWEKWANA 21415
/15
Identity
No:
[…]
RUDENECIA
ALLISTACIA
KRAAL 23068
/15
Identity
No:
[…]
LOURINE
FERREIRA
23076
I
15
Identity
No:
[..]
ANDREA
TOBIAS VAN
HEERDEN
25733
I
15
Identity
No:
[…]
GESINA
CAROLINA
LERM 25741
I
15
Identity
No:
[…]
ASHWELL
MORNE
OPPERMAN 39697
I
15
Identity
No:
[…]
TRACEY
NEL
23403
I
15
Identity
No:
[…]
JUDGMENT
MAKHUBELE
AJ
INTRODUCTION
[1]
All these matters and four others came before me in the unopposed
roll of 23 June 2015. I stood them down to allow counsel to
submit
written heads of argument to address certain concerns that I had. The
heads of argument were apparently submitted within
the agreed
date
[1]
, however, they were only
brought to me sometime towards the end of October 2015.
The
applications appear to comply with the procedural requirements
in terms of Section 4 of the Insolvency Act, Act 24 of
1936 ( "the
Act") , as amended. However, when I perused the affidavits, and
indeed the Statements of Debtors' Affairs
that lay for inspection,
there was a common trend that worried me and led me to ask a question
as to whether there has been a full
and frank disclosure of all
material facts that would enable me to exercise my discretion in
favour of granting the relief sought.
[2]
Except for Tracey Nel (Case number 23403 /15) all other applicants
are represented by one firm of attorneys, Francois Uys Incorporated.
The same counsel though, Ms L. Jansen, appeared in all applications.
[3]
The trend that worried me is that there is no proof to support
allegations relating to income, expenses and liabilities. All
applicants who are employed did not attach proof of income, as such;
I do not know whether the income disclosed is gross or nett
salary.
If it is the latter, I do not know what kind of deductions are there
and whether they are of a voluntary or statutory (compulsory)
nature.
[4]
Allegations were made about creditors having issued summonses and
letters of demand, but nothing was attached as proof. Long
lists of
creditors, some of whom appear to be financial institutions and micro
lenders were drawn, but no further explanations
were provided. There
is basically no evidence to enable me to consider not only existence
of such debts, but also when and circumstances
under which they were
incurred and the nature of the credit facility. In some instances,
allegations are made about indebtedness
relating to water and lights,
school fees and medical aid for instance. However, no documents were
attached to prove the existence
of such debts.
THE
ISSUES RAISED WITH COUNSEL
Whether
there has been a full and frank disclosure of material facts
[5]
I referred counsel to the judgment of Bertelsmann J in the matter of
Ex
Parte: E and Another (55075/2014) [2014] ZAGPPHC 919;
2015 (1) SA 540
(GP) (15 October 2014)
[2]
where the learned judge has referred extensively to several decisions
to re-iterate the problems that courts encounter with voluntary
sequestrations.
One
of the issues the learned judge raised was the duty that rests on the
applicants to act openly and honestly toward the court
in every
respect (para.6).
[6]
In paragraph 7, Bertelsmann J quoted several passages3 in the
judgment of Gorven J in the matter of
Ex Parte Arntzen (Nedbank
Ltd as Intervening Creditor)
2013 (1) SA 49
(KZP)
'5. Courts have long
required an applicant in voluntary surrender applications to make a
full and frank disclosure.
[3]
This arises at least in part from the stringent test referred to
above. It is quite clear that without a full and frank disclosure,
the court cannot be 'satisfied' as to the above two criteria in
particular. The required high level of disclosure is also affected.
in no small measure, by the fact that the application is ordinarily
brought on an ex parte basis, as is the present one. There
is ample
authority that applications brought on that basis require the utmost
good faith.
4
The principles were succinctly stated by Le Roux J in Schlesinger v
Schlesinger
5
in a rescission application as follows:
'(1) in ex parte
applications all material facts must be disclosed which might
influence a Court in coming to a decision;
2. the non-disclosure
or suppression of facts need not be wilful or mala fide to
incur the penalty of rescission; and
3. the court, apprised
of the true facts, has a discretion to set aside the formal order or
to preserve it.
…
11. Voluntary
surrender applications have begun to proliferate in this division. A
fledgling cottage industry has reared its head.
As was the situation
with 'friendly ' sequestrations in Mthimkhulu, many of these take a
standard form with almost identical averments
and are drafted by a
small set of attorneys who have chosen to specialise in such
applications. In most cases the estate is small,
as is the case in
the present application. In many of them, confronted by the
requirement that all the costs of sequestration must
be defrayed from
the estate and it must still be shown that sequestration would be to
the advantage of creditors, a formula has
arisen to reduce these
costs. The applicant states that a friend or relative has undertaken
to pay the costs of the applicant's
attorney and that the attorney
concerned will not look to the estate for his or her costs. Just such
on averment is mode in the
present application.
12. I take the view
that there is an even greater risk of abuse and a risk that the
interests of creditors will be undermined in
voluntary surrender
applications than in 'friendly ' sequestration applications.
Therefore the need for full and frank disclosure
and well founded
evidence concerning the debtor's estate is even more pronounced.
There are a number of reasons for this, some
of which have been
foreshadowed in the discussion above. I shall mention only some.
First, the applicant tends to focus on the
formal requirements of s 4
of the Act and does not seem to appreciate the need to satisfy a more
rigorous test than for sequestration
applications at both provisional
and final stages as regards advantage to creditors. Secondly the
court must perforce, in most
instances, rely on the founding papers.
This brings into play the peculiar characteristics mentioned above of
voluntary surrenders
being brought as ex parte applications. Thirdly,
no collusion between friendly creditor and debtor is necessary since
it is the
debtor who is the applicant and has a more direct interest
in the application succeeding and understanding of the genuine
position
than the friendliest of creditors. Voluntary surrender
applications therefore require an even higher level of disclosure
than do
'friendly' sequestrations if the court is to be placed in a
position where it can arrive at the findings and exercise the
discretion
set out in s 6( I) of the Act.'
[7]
In all applications from Francois Uys Incorporated, the averments
relating to letters of demand, summonses, why the applicants
did not
subject themselves to debt review processes are similar. a sort of
cut and paste from the same source document. The only
difference is
numbering of paragraphs in some instances. For example, with regard
to letters of demand and summonses, this standard
paragraph appears
in all applications:
"10
It is my submission
that it will be to the advantage of all my creditors as a whole if my
application for voluntary surrender of
my estate is granted,
especially for the following reasons:
10.1 I am not in a
financial position to pay my debt and I have already received letters
of demand and summonses from my creditors.
10.2 I expect that the
rest of my creditors will also issue summons. The legal costs that
will be incurred will have a further negative
impact on my financial
position if estate is not sequestrated.
10.3 If a curator is
appointed, he will be able to sell my assets and divide the proceeds
amongst my creditors which will have the
effect that all the
creditors will be treated equally’
[8]
On whether applicants should subject themselves to debt review
processes, they all declared, in similarly worded paragraphs
numbered
either 16 or 17 that:
“
16
My legal
representative advised me on the legal process of debt review in
terms of the National Credit Ac t, Act 34 of 2005.
My situation is of
such a nature that debt review would not be applicable to me, due to
the fact that I cannot afford to pay the
required monthly installment
to the creditor. I have also already received letters of demand in
terms of
Section 129
of the
National Credit Act 34 of 2005
from other
creditors. I wish to proceed with this application of voluntary
surrender of my estate"
[9]
None of the applicants has provided meaningful explanations or
attached proof of (a) income earned, (b) alleged letters of demand
and summonses received, (c) emolument orders granted against the
salary, (d) expenditure such as water and lights account, medical,
phone and groceries and (e) existence of debt as indicated in the
List of Creditors (Annexure IV to the Statement of Affairs) ,
how and
when it was incurred, the original amount and the purpose for which
it was incurred.
[10]
The only difference in these applications is the identity and amount
owed to the alleged creditors in the list of expenses
as well as
Annexure IV of the Statement of Affairs.
I
proceed to quote from selected applications what has been declared
with regard to expenses and creditors (Annexure IV to their
statement
of Affairs).
Tanya
Iris Reggioro (Case number 66537/15)
[11]
The applicant has listed the following expenses in her founding
affidavit.
1. Rental
3 800.00
2. Water and electricity
600.00
3. Groceries
1 500.00
4. School fees
600-00
5. Travelling expenses
500-00
6. Insurance
520-00
7. Telephone
150-00
[12]
Her creditors are listed in Annexure IV to the Statement of Affairs
as follows:
Name and address of creditor
Nature and value of security for
claim
Nature of Claim
Amount of Claim
1. Nedbank
None
Money lent and advanced
20 002-02
2. African Bank
None
Money lent and advanced
11 967-32
3. First National Bank
None
Money lent and advanced
18 733-65
4. Real People
None
Money lent and advanced
6 666-67
5. Balance Your Bond
None
Services rendered
1 550-25
6. Wonga
None
Money lent and advanced
1 433-33
7. Motor Finance Corp.
None
Money lent and advanced
0 -00
8. SA Multi Loans
None
Money lent and advanced
1 000-10
9. Nashua
None
Services rendered
1 933.33
10. Somerset Hospital
None
Services rendered
1 000.56
11. Edgars
None
Goods delivered
1 766.67
12. Foshini
None
Goods delivered
666.67
13. Lewis Stores
None
Goods delivered
7 000.12
TOTAL: 73 720.69
Danielle
Robinson (Case number: 21414)
[13]
She earns a salary of R12 000.00 and her monthly expenses are as
follows:
1 . Rental
5200-00
2. Medical
4 400-00
3. Groceries
2 000-00
4. School Fees
2 500-00
TOTAL
R14 100-00
[14]
She listed her creditors in Annexure IV as follows
Name and address of creditor
Nature and value of security for
claim
Nature of Claim
Amount of Claim
1. Nedbank
None
Money lent and advanced
44 446-81
2.Direct Axis
None
Money lent and advanced
697=49
3. Wesbank
None
Money lent and advanced
4 450-60
4. Woolworths
None
Goods delivered
14 536-34
5. Sanlam
None
Money lent and advanced
6 899-22
6. Nedbank
None
Money lent and advanced
7 242-75
7. Standard Bank
None
Money lent and advanced
4 718-22
8. Sterns
None
Goods delivered
122-87
9. First National Bank
None
Money lent and advanced
77 514-12
10.Absa
None
Money lent and advanced
2 950-86
11. Edgars
None
Goods delivered
4 075-72
TOTAL: 167 655-00
Yoliswa
Aretha Magcwekwana (case number: 21415 / 15)
[15]
She earns a salary of R7 400-00 from her job as an Administrator. She
does not mention who her employer is and whether this
is a nett or
gross salary. As stated above, there is no salary slip from where I
could discern this and other relevant information
such as deductions
of a voluntary and or statutory nature.
Her
expenses are:
1. House
5 000-00
2. Water and electricity
500-00
3. Groceries
l 000-00
NO ITEM 4
5. School Fees
800-00
6. Transport
l 000-00
TOTAL
8 300-00
[16]
Her list of creditors (Annexure IV to the Statement of Affairs) reads
as follows:
Name and address of
creditor
Nature and value of security for
claim
Nature of Claim
Amount of Claim
l. Nedbank
Bond
Money lent and advanced
240 786-94
2. African Bank
None
Money lent and advanced
39 570-26
3. OK
None
Money lent and advanced
32 916-86
4. African Bank
None
Money lent and advanced
44 781-73
5. Nedbank
None
Money lent and advanced
10 396-12
TOTAL: 368 481-93
Rudinecia
Allistacia Kraal (Case number 23068
I
15)
[17]
She is currently unemployed. However, she has failed to give further
particulars with regard to the period of, her last salary
and
prospects of future employment.
Her
expenses are:
1.
Rent
3 000.00
2.Water and electricity
800-00
3. Groceries
1000-00
4. School fees
900-00
5. Medical
500-00
TOTAL
6 200·00
[18]
Her creditors are listed in Annexure IV to the Statement of Affairs
as follows:
Name and address of
creditor
Nature and value of security for
claim
Nature of Claim
Amount of Claim
1. Standard Bank
Bond
Money lent and advanced
96 900-00
2. Foschini
None
Goods delivered
3 279-98
3. Truworths
None
Goods delivered
5 842-69
4. Home Choice
None
Goods delivered
5 527-28
5. Mr Price
None
Goods delivered
805-90
6 Autopage
None
Services rendered
1 548-75
7. Absa Personal loans
None
Money lent and advanced
5 027.66
8. FNB
None
Money lent and advanced
8137.88
9. NONE
10. Nedbank Credit
None
Money lent and advanced
10 852.19
11. Nedbank
None
Money lent and advanced
28 250.25
12. MTN
None
Services rendered
2 986.60
13. Damelin
None
Services rendered
10 960.18
14. Bayport
None
Money lent and advanced
22 647.66
15. Brom Finance
None
Money lent and advanced
1 719.35
16. Absa
None
Money lent and advanced
18 166.95
TOTAL: 222 653.32
Lourine
Ferreira (Case number: 23076 /15
[19]
She earns R10 213 from her job as Personal Assistant in a Quantity
Surveying firm. Like every one of the applicants, this is
all the
information that has been provided about her income.
Her
expenses are listed as follows:
1.
Rent
2 500.00
2.Water and electricity
1 600-00
3. Groceries
2 400-00
4. Clothing
1 700-00
5. Medical Aid
2 100-00
TOTAL
10 300·00
[20]
Her creditors are listed in Annexure IV to the Statement of Affairs
as follows:
Name and address of creditor
Nature and value of security for
claim
Nature of claim
Amount of claim
1. Absa
Bond
Money lent and advanced
42 716.21
2. African Bank
None
Money lent and advanced
9 034.39
3. African Bank
None
Money lent and advanced
16 686.39
4. African Bank
None
Money lent and advanced
14 373.19
5. African Bank
None
Money lent and advanced
12 628.44
6. African Bank
None
Money lent and advanced
10 147.37
7. African Bank
None
Money lent and advanced
8 563.68
8. African Bank
None
Money lent and advanced
9 215-46
9. Call Direct
Money lent and advanced
27 663-61
10. Consumer Friends RCS
None
Money lent and advanced
4 714-37
1 1. Edgars
None
Goods delivered
4 086-20
12. First National Bank
None
Money lent and advanced
l 829-07
13. Gerrie Groenewald Attorneys
None
Services rendered
1 850-00
14. lzwe Loans
None
Money lent and advanced
3 308-24
15. Wonga
None
Money lent and advanced
2 607-41
16. Nedbank
None
Money lent and advanced
20 682-20
TOTAL: 190 106-68
[21]
The remaining applications
[4]
from the office of Francois Uys Inc are not different from the others
that I have already discussed above. It will serve no purpose
for me
to reproduce their list of expenses and creditors.
Tracey
Nel (Case Number: 23403/15)
[22]
This is the only application that does not come from Francois Uys
Incorporated, however, it is not different from the rest
with regard
to lack of disclosure of basic information such as proof of income,
expenses, debts, when they ere acquired, the original
amount, arrears
thereto and purpose for which they were incurred.
The
National Credit Act, Act
34 of 2005 ( "the Credit Act")
[23]
The only averments with regard to compliance with the National Credit
Act, 34 of 2005 ("the Credit Act") are what
I have already
quoted from paragraphs 16 or 17 of the founding affidavits of the
first eight applications where the applicants
have declared that they
would not qualify for debt counseling because they will not afford to
pay the costs, and furthermore, that
they have already started to
receive letters of demand in terms of section 129.
[24]
In addition to the issues I have raised above, I also enquired from
counsel for the applicants whether the debts disclosed
in the list of
creditors (Annexure IV to their Statement of Affairs) are not credit
agreements that would probably be subject to
the provisions of the
Credit Act that I will refer to hereunder and also whether the
applicants should have followed the prescribed
processes to manage
their debt instead of Insolvency proceedings.
[25]
Section 80 of the Credit Act titled "
Reckless credit"
reads as follows:
(1) A credit agreement
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 1 19(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) entering into
that credit agreement would make the consumer over-indebted.
(2) When a
determination is to be made whether a credit agreement is reckless or
not, the person making that determination must
apply the criteria set
out in subsection [1] as they existed at the time the agreement was
made, and without regard for the ability
of the consumer to-
(a) meet the
obligations under that credit agreement; or
(b) understand or
appreciate the risks, costs and obligations under the proposed credit
agreement, at the time the determination
is being made.
(3) When
making
a
determination
in
terms of this
section,
the
value of-
(a) any credit
facility
is
the
credit
limit at that time
under
that credit facility;
(b) any
pre-existing
credit
guarantee
is-
(i)
the
settlement value
of
the
credit
agreement that
it
guarantees, if the
guarantor has been
called upon
to
honour that guarantee;
or
(ii) the settlement
value of the
credit
agreement
that it guarantees, discounted by a
prescribed
factor;
and
(c) any new credit
guarantee is the settlement value of the credit agreement that it
guarantees, discounted by a prescribed factor.
[26]
Section 85 of the Credit Act prescribes the powers of the court when
a credit agreement is being considered and it reads as
follows:
"
85. Court
may declare and relieve over-indebtedness
Despite any provision
of law or agreement to the contrary, in any court proceedings in
which a credit agreement is being considered,
if it is alleged that
the consumer under a credit agreement is over-indebted, the court
may-
(a) refer the matter
directly to a debt counsellor with a request that the debt counsellor
evaluate the consumer's circumstances
and make a recommendation to
the court in terms of section 86(7); or
(b) declare that the
consumer is over-indebted, as determined in accordance with this
Part, and make any order contemplated in section
87 to relieve the
consumer's over-indebtedness.
[27]
In terms of section 86, a consumer may apply to a debt counselor to
be declared over-indebted before a credit provider takes
steps to
recover the debt in terms of section 130.
[28]
It is settled law that proceedings under the Insolvency Act such as
what is before me fall within the category of proceedings
contemplated in Section 85 of the Credit Act and that Iwould be
entitled to act in terms of the remedial provisions thereof.
See:
Ex
Parte Ford, Ex Porte Venter; Ex Porte Botes (21084/08, 1034/09,
1035/09)
[2009] ZAWCHC 24
;
2009 (3) SA 376
(WCC) (5 March 2009)
[5]
(para [12] at
381F-H)
APPLICANTS'
SUBMISSIONS
[29]
Ms Jansen's starting point to each and every question I have raised
is that a duty to disclose a fact depends on whether it
is a material
fact or not and whether its disclosure would make a difference to the
success of the application.
[30]
I have already quoted the relevant paragraphs from some of the
judgments
[6]
she relied on in
her submissions and in fact, the issues I raised with her in court
emanates from these decisions. As a result
I will not repeat the
principles arising therefrom.
[31]
In summary, Ms Jansen submitted that:
[31.1]
Creditors are given an opportunity to consider the applications and
have an election to intervene should they wish to do
so.
[31.2]
The facts deposed to in the affidavits were sworn to under oath.
[31.3]
Corroboration of what has been sworn to by submission of documents
such as payslips, statements and vouchers is not necessary,
and if a
particular court deems it necessary, the application may be stood
down to afford an applicant an opportunity to supplement
the papers.
[31.4]
The applications have been prepared over time to ensure that all
necessary allegations are made and the court should not
be burdened
by voluminous bundles of corroborating evidence. Furthermore,
attaching corroborating evidence would increase the costs
of the
application and take the court's time.
[31.5]
It is difficult to find evidence to corroborate certain expenses, for
example, travelling costs, petrol and groceries.
[31.6]
Applicants who are unemployed would find it difficult to provide
salary advices and as such it is difficult to comprehend
how they
could satisfy this requirement.
[31.7]
Providing corroboration would be of no real and evidentiary value.
[31.8]
Attaching bank statements and credit card accounts could compromise
the privacy of the applicants because this information
will be
subject to public scrutiny. The court must, in the absence of
opposition, assume that the amount indicated in the Debtors'
Statement of Affairs is correct. An aggrieved creditor may apply for
rescission of judgment even after the estate has been sequestrated.
[31.9]
The debt review processes would apply to those applicants who are
earning a salary. The court is in a position to determine
or draw a
conclusion whether an applicant would be able to satisfy at least 803
of each creditor's claim's minimum payment by taking
into account the
salary earned and the expenses listed.
[31.10]
Attaching letters of demand and summonses would be an administrative
burden for those who prepare the applications. It would
also be a
burden on the court because
"there are hundreds of these
applications brought every week in a given division and it is for
this reason that I believe that
a pro forma standard index should
exist"
.
[31.1
1] The court must accept the surrender of an estate once satisfied
that there has been compliance with procedural and substantive
requirements, that there is no opposition from the creditors and the
dividend calculations is in order.
[31.12]
In certain instances, the applicants do not have the luxury of time
to source corroborating evidence because they suddenly
find
“
themselves at a point of no return”
ANALYSIS
OF THE EVIDENCE
[32]
It is unfortunate that Ms Jansen chose to approach my concerns from a
humorous point of view to an extent that her submissions,
to a large
extent, bordered on sarcasms. This deprived her of an opportunity to
make real submissions that could have assisted
me. For example, it
was never my intention to insist that applicants who are not employed
should submit salary advices. In fact,
only one applicant
[7]
is allegedly unemployed. The questions I raised with regard to her
application are appropriate for her situation and relevant.
The
concerns I raised were not intended to convey a message that the
valuator of an immovable property should
"count and list the
light bulbs in a property other than and except for a valuable
chandelier which could be considered to
be an investment or add value
to such a property"
[33]
Had Ms Jansen approached my concerns on a serious note and considered
the purpose for which the information is required, she
would have
seriously applied her mind to the issues in the context of (a) proof
of insolvency and (b) whether or not there has
been compliance with
the provisions of the Credit Act and, if not (c) the powers of the
court.
I
had a reasonably lengthy exchange with Ms Jansen before I stood the
matters down, however, at no stage did she request that the
matters
be postponed to allow the applicants an opportunity to address the
issues I raised. In any event, I did not consider that
as an option
because there is no basic information in the founding affidavits to
even begin any enquiry in terms of either Section
6 of the Act
(whether or not the applicants are insolvent) and the Credit Act (to
convert the proceedings to an enquiry to establish
whether or not the
applicants are over-indebted).
[34]
I stated in the introductory parts of this judgment that the
applicants have simply stated that they earn a certain amount
of
money, without even bothering to indicate the nature of deductions
and whether they are of a voluntary or statutory
nature and
whether the amount indicated is a gross or nett salary. Clearly, an
applicant who gives such basic information would
to a greater extent
have discharged the duty to disclose ( even without attaching a
salary advice/ payslip) than one who simply
states that he/she earns
R10 000.00.
[35]
It would be ludicrous of me to accept the suggestion that I should
simply accept an allegation that an applicant owes money
to a school,
hospital, municipal service provider, etc without a shred of
evidence.
[36]
In the context of the Credit Act, questions such as when the debt was
incurred, original amount, and existence of other debts
when the new
one was incurred are relevant. I can accept the omission in the
Statement of Affairs because one may argue that the
form is
standardized and does not make provision for other information than
what is requested, however, all applicants did not
elaborate on this
issue in the founding affidavit. In fact, they simply referred to the
relevant part of the Statement of Affairs.
[37]
The court in the matter of
Ex
Porte Ford and Two Other Similar matters
[8]
at least had a luxury of some basic information relating to the
circumstances of the applicants, such as deductions that
were being made in their salaries, hence the Learned judge was
able to evaluate the indebtedness of the applicants taking
into
account what they had disclosed. The court stood
the matter down to allow the applicants an opportunity
to explain
certain things arising from what was before it.
In
these matters, I have nothing, just bare copied allegations from one
application to the next.
[38]
It is only when a court is in possession of this basic information
that it can even begin to venture into the questions contemplated
in
section 85 of the Credit Act or even to answer the question of
whether or not the applicants are insolvent.
In
these applications, all I have is long lists of creditors. I do not
know whether the debts were incurred on the same day and
whether each
one of the creditors was aware of the existence of the other one when
credit was extended.
[39]
I am aware of what Ms Jansen refers to as hundreds similar
applications that pass through the courts on a weekly basis. However,
I do not agree with her submission that the
"preparation,
compilation
and preparation"
of these applications
should be a mere administrative function on the part of the attorneys
to an extent that they simply fill in
a "pro forma
standard
index"
that is just a copy and paste of conclusions of law
without laying a factual foundation that pertains to the specific
circumstances
of each individual applicant.
[40]
I have also, in my short stint as an Acting Judge
[9]
come across many such similar applications and where necessary, I
have allowed the matters to stand down for the applicants to
supplement their papers to address a specific concern
[10]
that I had or to address me on a point of law
[11]
.
[41]
I am also aware of several decisions of the High Courts where the
courts have expressed concerns with the content of voluntary
surrender of estates applications. Some of these problems were
highlighted in the judgment of Bertelsmann J in the Ex Porte Erasmus
and Another
[12]
matter.
I
have also observed improvements in that legal practitioners have
heeded some of those concerns. Valuation reports, calculation
of
dividends and procedural requirements to a large extent are no longer
an issue.
[42]
However, in my experience, the issues that I have raised remain a
problem, and more so because one would, like I did, be confronted
with more than ten (10) applications that are based on the same "pro
forma" affidavit. The applications say nothing about
the
circumstances of each individual.
[43]
Counsel for the applicant appears to suggest that the courts should
be part of what she refers to as administrative functioning
in the
whole scheme of voluntary surrender of estates. If this were to be
allowed, there would be no need to refer the applications
to an open
court. The Office of the Registrar would be best suited to check
compliance with procedural requirements, tick the appropriate
boxes
and accept surrender of the estates.
[44]
I have noted the decisions
[13]
that have been attached to Ms Jansen's heads of argument to support
her contention that the court should accept the amounts listed
in the
applicants' Statement of Affairs as correct and that applicants have
proved that they are insolvent.
Keightley
AJ was confronted with an opposition from the bank on the basis that
the court should not use the market value of the
property to
determine whether the applicants were insolvent or not. The other
grounds of opposition related to whether the valuation
of the
property was correct or not and the effect of overstating
indebtedness to the bank. None of these issues arise from the
matters
before me.
Furthermore,
there is nothing in the judgment to indicate that the Learned Judge
was faced with the same problems that I have in
this matters, namely,
lack of basic information for me to begin to assess whether, on the
facts, the applicants are solvent or
not and whether there has been
compliance with the debt management provisions of the Credit Act, and
if not, whether I should act
in terms of the remedial provisions
thereof.
Similarly,
Hiemstra AJ was faced with the question of whether the court should
take into account the market value of a property
or forced sale to
consider the issue of solvency. That is not what I am dealing with
here.
[45]
Standing the matters down to allow the applicants an opportunity to
supplement their papers would not, under the circumstances
be an
appropriate order because as I have stated already, there is nothing
in the founding affidavits about the circumstances of
each applicant.
Counsel for the applicants has urged me to accept the scanty
allegations, mainly because there is no opposition
from creditors. I
do not agree that absence of opposition constrains the exercise of
the discretion that I have.
[46]
I am not in a position to assess whether objectively, the applicants
are insolvent or not and whether, I should invoke any
of the
provisions of the Credit Act.
[47]
Accordingly, I make the following orders,
[47.1]
In the matter of
TANYA IRIS REGGIORO, Case number 66537 /14,
the
application for voluntary surrender of the estate is refused.
[47.2]
In the matter of
DANIELLE ROBINSON, Case number 21414 /15,
the
application for voluntary surrender of the estate is refused.
[47.3]
In the matter of
YOLISWA ARETHA MAGCWEKWANA,
Case Number
21415/1 5, the application for voluntary surrender of the estate is
refused.
[47.4]
In the matter of
RUDENECIA ALLISTACIA KRAAL, Case Number
23068
/15
, the application for voluntary surrender of the estate is
refused.
[47.5]
In the matter of
LOURINE FERREIRA, Case Number
23076 /15,
the application for voluntary surrender of the estate is refused.
[47.6]
In the matter of
ANDREA TOBIAS VAN HEERDEN, Case Number 25733 /15,
the application for voluntary surrender of the estate is refused.
[47.7]
In the matter of
GESINA CAROLINA LERM, Case Number 25741 /15,
the
application for voluntary surrender of the estate is refused.
[47.8]
In the matter of
ASHWELL MORNE OPPERMAN, Case Number 39697 / 15,
the application for voluntary surrender of the estate is refused.
[47.9]
In the matter of
TRACEY NEL, Case Number 23403
I
15,
the application for voluntary surrender of the estate is refused.
____________________
TAN
MAKHOBELE AJ
Acting
Judge of the High Court
DATE
HEARD:
23 June 2015 and stood down to 08
August 2015.
APPEARANCES:
Advocate
L Jansen
1-8
applicants: instructed by Francois Uys Incorporated, Centurion,
PRETORIA
9
th
applicant: instructed by Cassie Fourie Attorney, Moreleta Park,
PRETORIA
[1]
I stood the matters to 08 August 2015. The heads of argument are
dated 03 July 2015.
[2]
Reported in the SALAR as
Ex
Parte Erasmus and Another 2015 (1) SA 540 (GP)
[3]
Footnotes omitted.
[4]
Gesina Carolina Lerm (Case number: 25741 I 15). Ashwell Morne
Opperman, Case number: 39697 I 15) and Andrea Tobias Van Heerden,
Case number: 25733 I 15)
[5]
Reported in the SALR as: Ex Parte Ford and Two Similar Cases 2009
(3) SA 376 (WCC)
[6]
Bertelsmann J in the matter of Ex Porte Erasmus, supra and Gorven J
in the matter of
[7]
Ex Parle RA Kraal, Case Number 23068/15
[8]
supra
[9]
since 2013
[10]
I was once confronted with several applications where the value of
the estate was calculated on the basis of a valuation of personal
effects. The matters stood down for the applicants to explain how
they were going to survive without such basics. [judgment of
Landman
J in the matter of ...
[11]
My judgment in the matter of Ex Parte Van Dyk ( 1869/2015) [2015]
ZAGPPHC 154 (26 March 2015) I dealt with the question of whether
surrender of an estate should be accepted under circumstances where
the dividend that would accrue to the creditors from the
residue of
the estate amounted to "O cent per Rand", but under
circumstances where the applicant was prepared to pay
a monthly
contribution to his insolvent estate over a period of about 4 years
in terms of section 23(5) of the Insolvency Act.
[12]
Supra
[13]
Judgment of Keightley AJ in the matter of Ex parte Leon Rudolph
Lochenberg and Another (Absa Bank intervening), Case number 61888/13
and the judgment of Hiemstra AJ in the matter of Ex Porte Adele
Ackerman { Absa Bank intervening) , Case number 61678 I 13