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[2015] ZAFSHC 42
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New Integrated Credit Solutions (Pty) Ltd v Mangaung Local Municipality (2321/2014) [2015] ZAFSHC 42 (26 February 2015)
IN THE HIGH COURT OF
SOUTH AFRICA
FREE STATE DIVISION,
BLOEMFONTEIN
Case No: 2321/2014
DATE: 26 FEBRUARY 2015
In the matter between:
NEW INTEGRATED CREDIT
SOLUTIONS
................................................................
APPLICANT
(PTY) LTD
Versus
MANGAUNG LOCAL
MUNICIPALITY
....................................................................
RESPONDENT
CORAM: NAIDOO, J
JUDGMENT: NAIDOO, J
HEARD ON: 27 NOVEMBER 2014
DELIVERED ON: 26 FEBRUARY 2015
JUDGMENT
Naidoo J
[1] The applicant (plaintiff in the
main action) applies, in terms of Rule 30(1) of the Uniform Rules of
Court, for the striking
out of an exception by the respondent
(defendant in the main action) to the applicant’s Particulars
of Claim, served on the
applicant on 19 August 2014. The applicant
contends that the exception constitutes an irregular step, as
contemplated by Rule 30(1)
on the following three grounds:
1.1 The defendant failed to serve the
exception within the prescribed time periods as set out in the
Uniform Rules of Court;
1.2 The exception is not signed in
accordance with Rule 18(1) by either an advocate or an attorney duly
admitted and having right
of appearance in terms of Section 4(2) of
Act 62/1995;
1.3 The defendant’s prayer in the
exception “Plaintiff’s particulars of claim be dismissed”
is bad in law
and not competent relief that may be granted by the
court.
The respondent opposes the application,
denying that the exception is an irregular step on any of the three
grounds I have listed
above. Mr G Naude appeared for the applicant in
this court and Mr AH Burger SC for the respondent.
[2] By way of background, the applicant
and the respondent entered into an agreement in terms of which the
applicant, a debt collector,
would collect, on behalf of the
respondent, certain debts due by third parties to the respondent. In
return the applicant would
be entitled to be paid collection
commission of 16% of all amounts collected by it. There were several
terms in the agreement regulating
the contractual relationship
between the applicant and respondent. In the summons relevant to this
matter (ie case number 2321/2014),
the applicant claims an amount of
R4 162 337.26, together with interest thereon. This amount is
ostensibly in respect of collection
commission due to the applicant
for the months of June and July 2011. Invoices dated 31 January 2014
in respect of both months
were attached to the summons in support of
the claim.
[3] It is perhaps useful at this point
to briefly sketch a timeline reflecting the history of how the
litigation unfolded in this
matter.
3.1 The applicant issued summons
against the respondent out of this Division on 26 June 2013,
under case number 2510/2013 (the
2013 summons), in which it claimed
collection commission for May, June and July 2011.
3.2 The respondent filed a notice in
terms of Rule 23(1) of the Uniform Rules on 8 November 2013, drawing
to the applicant’s
attention that the summons was vague and
embarrassing, and detailing therein which paragraphs of the
particulars of claim it was
assailing and the grounds for doing so.
It is not clear if an exception was filed by the respondent, but it
appears that the applicant
amended the Particulars of Claim in
February 2014. I pause to note at this point that although an
undertaking was made in the Founding
Affidavit to this application
that the file under case number 2510/2013 would be made available at
the hearing of this matter,
this was not done. I rely therefore on
certain averments and common cause facts contained in the Founding
and Opposing Affidavits,
as well as documents attached thereto, to
compile this timeline. The amendment to the 2013 summons entailed a
claim only in respect
of collection commission for May 2011(excluding
the claims in respect of June and July 2011). The applicant alleges
that pleadings
have closed in that matter and a trial date is being
sought.
3.3 Returning to the timeline, the
summons in the present matter was issued on 23 May 2014.
3.3 The respondent defended the action
on 5 June 2014. Thereafter the respondent filed a notice in terms of
Rule 23(1) on 20 June
2014 on the basis that the summons was vague
and embarrassing, and detailing the paragraphs it was assailing and
the grounds therefor.
3.4 The applicant’s response was
to file an application for summary judgment on 23 June 2014 (the date
of hearing being 14
August 2014).
3.5 On 4 July 2014, the respondent,
served a Notice in terms of Rule 30(2) on the applicant, alleging
that the applicant’s
application for summary judgment was an
irregular step in that it was brought when the complaint of the
respondent (in the Rule
23(1) Notice) had not been removed. The
applicant was given ten days to remove the cause of complaint, but
did not respond.
3.6 The respondent opposed the summary
judgment application on 11 August 2014 and filed (outside the time
allowed by the Rules of
Court) its opposing affidavit on 12 August
2014. As a result the matter was postponed from the unopposed roll on
14 August to the
opposed roll on 9 October 2014.
3.7 On 19 August 2014 the respondent
filed its exception to the summons, and it is common cause that this
was considerably after
the time normally allowed for the filing of
such a pleading.
3.8 On 26 August 2014, the applicant
filed a Notice in terms of Rule 30(2) alleging that the respondent’s
exception was an
irregular step, on the three grounds that I have
listed in paragraphs 1.1 to 1.3 above.
3.9 The application before me was
served on the respondent on 23 September 2014, the date of hearing
being 9 October.
3.10 0n 9 October 2014, the applicant’s
summary judgment application was dismissed with costs.
3.11 It appears that the current
application was not heard on 9 October 2014 but on 13 October 2014,
when it was postponed to 27
November 2014 and dates were set for the
filing of the various affidavits in this matter.
[4] Both counsel addressed the court at
length in advancing their respective cases. What is apparent (and
regrettably so), is that
the collegiality and cooperation which are
meant to be hallmarks of the legal profession were seriously lacking
in this matter.
Many of the complaints could have been resolved by
proper communication and cooperation between the parties, and costs
could have
been contained. Examples are the filing of pleadings or
the taking of further steps in the matter, without due regard for the
complaints
raised by the opposing party and simply ignoring
correspondence that flowed between the parties, or responding in a
manner which
made it clear that cooperation was not forthcoming. It
is apparent from the record that a number of procedural steps taken
by the
respondent were in fact not compliant with the time limits
provided for in the Rules, and understandably frustrated the
applicant.
The applicant’s conduct is also not above reproach.
The first summons it issued in 2013 was amended after the respondent
gave notice of its exception thereto, and the matter proceeded to the
point where a trial date could be obtained. The second summons,
which
was issued in May 2014, was couched in very similar terms to the
un-amended 2013 summons. The respondent once again gave
notice of
exception to such summons in terms very similar to its notice of
exception in respect of the 2013 summons. The point
made by the
applicant is that the 2013 summons is practically identical to the
one issued in the present matter and that if the
respondent was able
to plead to that summons, it could also do so in this matter. It
appears that the respondent was able to plead
to the 2013 after it
was amended. The present summons, which is couched in essentially the
same terms as the un-amended 2013 summons,
has not been amended
The attitude of the applicant in this
matter was simply to ignore the Rule 23(1) notice and three days
later file an application
for summary judgment, which caused the
parties to become embroiled in protracted litigation around the
summary judgment application.
While that is no excuse for the
respondent’s late opposition to the summary judgment
application and filing of the opposing
affidavit, as well as its
failure to set down its exception to the summary judgment
application, it is clear that its attention
was focused on staving
off the greater evil of summary judgment and not on fighting the
irregular procedural step it complained
of. The nett result of all of
this was to prevent the speedy closing of pleadings in order to
obtain a trial date for the ventilation
of the real issues between
the parties, and to unduly escalate the costs of this matter. Having
said that, I now deal with the
application at hand.
[5] It was common cause between the
parties that an exception is a pleading and subject to the same time
limits for filing as other
pleadings. As such an exception would fall
within the ambit of Rule 26 of the Uniform Rules, which provides for
an automatic bar
where a party has failed to file a replication or
subsequent pleading within the time provided for in the Rules, but
for all other
pleadings it requires a notice of bar to be filed
before the defaulting party can be precluded from filing such
pleading. Mr Burger
referred the court to the case of Tyulu v
Southern Insurance Association Ltd 1974(3) SA 726 (E), and Mr Naude
kindly provided a
copy of the case for the court. In that case the
defendant filed an exception two days after the due date and the
plaintiff objected
to it on the ground that it was filed out of time.
The court there held that the provision of Rule 26 applied to the
exception,
in that a notice of bar was required before the defendant
could be precluded from filing his exception. I align myself with the
reasoning of the court in Tyulu. In my view the Rule applies equally
to the present matter. Mr Naude argued that the Rules allow
the
applicant two options, namely to file a notice of bar or to bring an
application in terms of Rule 30, as it did in this matter.
[6] Rule 30 provides for the setting
aside of a procedural step where a party has taken such a step
irregularly. An irregular step
has been held to be a step which
advances the proceedings one stage nearer completion. The learned
author Eramsus in the work Superior
Court Practice at page B1-190
cites a number of instances which have been regarded, by our courts,
as an irregular step. Non-compliance
with the Rules is not one of
them, and with good reason, as this is dealt with by another Rule,
which I will refer to shortly.
Rule 30 (2) also provides that an
application in terms of subrule(1) may only be made if, inter alia,
the applicant himself has
not taken a further step in the cause. In
the notes on page B1-192, Erasmus, in discussing the notion of taking
a “further
step in the cause”, asserts that while
previously it was held that a notice of exception amounted to a
further step contemplated
by the Rule, this approach changed and it
was held that the excipient was concerned merely with making full use
of the remedies
provided by the rules to attack a defective pleading,
so that the filing of an exception cannot be held to have advanced
the proceedings
one step nearer completion. In my view this will
apply equally to an exception filed by the opposing party. Rule 30A
is the rule
that specifically provides a remedy for non-compliance
with the Rules, and the applicant ought to have sought his remedy in
Rule
30A. In my view it was not correct for the applicant to rely on
Rule 30(1) to complain about and seek sanction for the respondent’s
non- compliance with the time limits for filing of its exception.
Therefore the respondent is correct in holding that, in the absence
of a notice of bar, it is not subject to sanctions for not complying
with the prescribed time limits for the filing of its exception,
and
that the filing of the exception on 19 August 2014 did not constitute
an irregular step.
[7] The second ground upon which the
applicant seeks to have the exception set aside, is that it was not
signed, in accordance with
Rule 18(1), by either an advocate or an
attorney duly admitted and having right of appearance in terms of
Section 4(2) of the Right
of Appearance in Courts Act 62 of 1995 (the
Appearance Act).
[8] A perusal of the papers reveals
that every pleading, save the opposing affidavit in this application,
was signed by attorney
TK Gaborone. No reference is made in any of
those pleadings, save for the exception which is the subject of this
application, to
section 4(2) Appearance Act or to Attorney Gaborone’s
right of appearance in the High Court. The exception, on page 5,
contains
a line, under which certain words appear and are depicted as
follows:
“TK Gaborone
Attorney for Defendant
Moroka Attorneys
74-80 Pres Reitz Avenue
Suite 19, Reitz Park
Westdene
Bloemfontein”
Under these words appears another line
and under this line appear certain words depicted as follows:
“ TK Gaborone, duly admitted and
having the right of appearance ito Section 4(2) of Act 62/1995”
[9] On the first line shown above,
appears a signature which is the same or similar to that observed on
all the other pleadings
purported to be signed by TK Gaborone. The
second line depicted above does not bear a signature. It is on this
basis that the
applicant contends that the respondent has taken an
irregular step in that it has filed a pleading which is not signed in
accordance
with the Rules. I pause to note that no objection was
lodged by the applicant to any of the other pleadings bearing this
signature
and where no mention is made of the right of appearance of
the signatory. Save for the lack of a signature on the second line,
the exception complies with the provisions of Rule 18(1). It was not
the applicant’s case that the second line and/or a signature
thereon are either prescribed by the Rules or is an established and
required practice for the validation of a pleading. The respondent
argued that the second line can be ignored as it ought not to have
been there, and surmised that it could have been a typing error.
It
also raised the argument that TK Gaborone signed all other pleadings
without challenge. A copy of TK Gaborone’s certificate
in terms
of section 4(2) of the Appearance Act was attached to the
Respondent’s Heads of Argument, and much was made of this
by
the applicant, who alleged that the attachment of the certificate to
the Heads was an admission or acknowledgement by the respondent
that
the lack of a signature on the second line described above was
problematic. I do not agree. I regard the attachment of the
certificate to the respondents’ Heads to be a neutral factor,
at best, and this issue need not detain us any further. ’The
more probable explanation for the presence of the second line is the
one tendered by the respondent and would also explain why
Attorney
Gaborone’s signature does not appear thereon. He/she clearly
did not consider it necessary to place a second signature
on the
document, having already signed it. In this regard, I find the
approach of the applicant to be formalistic and its contention
regarding the lack of a signature on the second line without
substance. I am satisfied that there was compliance with Rule 18(1).
[10] With regard to the last ground
raised in the applicant’s exception that the relief sought by
the respondent is bad in
law, I have already alluded to the fact that
in its Rule 23(1) notice and in its exception, the respondent
referred to the specific
paragraphs of the applicant’s
particulars of claim which it objected to, stating the grounds for
such objection. There can
be no doubt in the mind of the reader of
the exception that the respondent is assailing only specific portions
of the particulars
of claim. In my view, a common sense approach must
be adopted when reading the prayer for relief sought by the
respondent, as common
sense will dictate that it is not capable of
being read as a prayer for the dismissal of the entire particulars of
claim, after
having regard to the body of the exception. While the
form of the prayer may be argued to be impermissible, it cannot be
read in
isolation. Again, a formalistic approach to the application
of the Rules of Court must be discouraged in the interests of
fairness
and equity between both parties. It is somewhat
opportunistic of the applicant to argue otherwise.
[12] The applicant argued for a
punitive costs order against the respondent, in view of what it held
were the dilatory tactics of
the respondent to delay and drag out
this matter in an attempt to avoid paying the appellant what was due
to it. I have outlined
my view of the conduct of the parties in
paragraph [4] of this judgment. The delays in this matter can be
attributed to both parties
at various stages of the litigation, and
in my view the court is entitled to demonstrate its displeasure at
the manner in which
this matter has been conducted by both parties,
by deviating from the norm that costs follow the result. The court
hearing this
matter on 13 October 2014 reserved costs, which I have
considered in my deliberations in this matter.
[13] I am not satisfied that the
applicant has made out a case for the relief it seeks and order as
follows:
13.1 The application is dismissed;
13.2 Each party is to pay its own costs
in respect of this matter, including the costs of the hearing on 13
October 2014
S. NAIDOO, J
Counsel for Applicant: Adv G Naude
Instructed By: Symington De Kok
169 Nelson Mandela Drive
Bloemfontein
(D Moller/ni/MMM3066)
Counsel for Respondent:Adv AH Burger
SC
Instructed By:Moroka Attorneys
74-80 President Reitz Street
Westdene
Bloemfontein
(SLL/AM0882/o.i)