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[2015] ZAFSHC 141
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GCP Van Zyl Familie Trust and Others v Absa Bank Ltd; In re: Absa Bank Ltd v GCP Van Zyl Familie Trust and Others (1493/2014) [2015] ZAFSHC 141 (2 July 2015)
IN THE HIGH COURT
OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Case
No: 1493/2014
In
the application of:
GCP
VAN ZYL FAMILIE TRUST
1
st
Applicant
VAN
ZYL: CHRISTOFFEL GERT PETRUS N.O.
2nd Applicant
SMITH:
CARIN
N.O.
3rd Applicant
PRETORIUS:
BRYAN
N.O.
4th Applicant
and
ABSA
BANK LTD
Respondent
In re:
ABSA
BANK LTD
Plaintiff
and
GCP
VAN ZYL FAMILIE
TRUST
1st Defendant
VAN
ZYL: CHRISTOFFEL GERT PETRUS
N.O.
2nd Defendant
SMITH:
CARIN
N.O
3rd Defendant
PRETORIUS
BRYAN
N.O
4th Defendant
CORAM:
NAIDOO, J
HEARD
ON:
30 APRIL 2015
JUDGMENT
BY:
NAIDOO, J
DELIVERED
ON:
2 JULY 2015
NAIDOO
J
[1]
This is an application for the rescission of a judgment where the
applicants seek an ord
er
in the following terms:
“
1.
Granting the first to fourth applicants
(“applicants”
)
condonation for the late bringing of this rescission of
judgment application’
2.
The default judgment granted against the applicants and in
favour
of the respondent is set aside/rescinded.
3.
The attachment of all assets under attachment (“
the
assets”
)
(sic)
and the Sheriff is ordered to return/release such assets to the
applicants.
4.
The applicants are ordered to pay to the Sheriff of the High Court
all costs related to the removal and storage of the
assets under
attachment.
5. Costs of the
application (only if opposed).
6.
Granting the applicants further and/or alternative relief)”
The
respondent opposes the application on the basis that the applicants
failed to give a satisfactory explanation for their delay
in bringing
the application for rescission and that they have not shown that they
have a
bona
fide
defence to the respondent’s claim. The applicants were
represented in this court by Mr W Wannenburg and the respondent by
Mr
E Eksteen.
[2]
The facts in this matter are, briefly, that the first applicant (the
Trust) ordered two trailers from a supplier, and the trailers
were
financed by the respondent. Initially the Trust and the respondent
entered into two lease agreements, but the Trust took delivery
of the
one trailer (the 1
st
trailer) but not the other (the 2
nd
trailer), as it did not meet the Trust’s requirements. After a
while the lease agreement in respect of the 2
nd
trailer
was cancelled and the deposit of R200 00.00 paid by the Trust in
respect of that trailer was refunded to it by the respondent.
It also
appears that certain costs associated with the 2
nd
trailer, amounting to R89 014.86, were also credited to the account
of the Trust by the respondent. There was consequently, one
valid
lease (in respect of the 1
st
trailer) still in existence
between the parties.
[3]
It is common cause that approximately two years after the lease
agreement was signed in February 2009, the Trust made four payments
in respect of the account relating to the 1
st
trailer, in respect of which there was still a valid lease agreement.
These payments totalled R300 00.00. The Trust also paid a
deposit of
R200 00.00 in respect of the 1
st
trailer. The initial debt in respect of the 1
st
trailer was R 615 999.00.The agreement between the parties permitted
the respondent to charge interest on arrear payments, which
it
clearly did. After the Trust made, on 3 August 2012, the fourth of
the four payments I referred to, it made no further payments
in
respect of its account with the respondent. The latter issued summons
against the Trust and its trustees (in their representative
capacities) in April 2014. The 2
nd
and 3
rd
applicants were also sued in their personal capacities as sureties.
The summons was served by affixing it to the gate of
the address
chosen by the Trust as its
domicilium
citandi et executandi
.
Neither the Trust nor its Trustees defended the matter, and the
respondent obtained judgment by default against all four defendants,
who are the current applicants, on 29 August 2014. This application
for rescission was launched on 27 January 2015.
[4]
Rule 27(1) of the Uniform Rules of Court provides:
“
In
the absence of agreement between the parties, the court may upon
application on notice and on good cause shown, make an order
extending or abridging any time prescribed by these rules or by an
order of court or fixed by an order extending or abridging any
time
for doing any act or taking any step in connection with any
proceedings of any nature whatsoever upon such terms as to it
seems
meet”
The
requirement of “good cause” to be shown is repeated in
sub-rule (3) which provides that “The court may, on
good cause
shown, condone any non-compliance with these rules”.
These
two sub-rules of Rule 27 provide the court with a wide discretion to
condone non-compliance with the Rules. It is clear, however,
that an
important safe guard is that good cause must be shown.
[5]
The applicants allege that they became aware of the action in this
matter only on or about 11 November 2014, when the Sheriff
of this
court arrived at the premises of the 2
nd
respondent, Mr Van Zyl (Van Zyl) to attach assets, which he did. The
Trust then appointed attorneys in November 2014 to act on
its behalf.
Van Zyl consulted with the Attorneys in December 2014, after the
attorneys obtained copies of the relevant documents
from the
respondent’s attorneys. The Trust’s attorney was then
ostensibly on leave from 12 December 2014 and returned
in January
2015.He, however, injured himself and was away from the office until
19 January 2015. It was only thereafter that the
papers for the
rescission application were finalised.
[6]
The narrative of the Trust, in the Founding Affidavit, notably lacks
details of specific dates relating to the receipt of documents
from
the respondent’s attorney, consultations with the Trust’s
attorneys and counsel and the drafting of the papers,
all of which
would have been within the knowledge of the Trust’s attorneys
and easily ascertainable. Such details would have
assisted in the
assessment of whether good cause has been shown. In an application
for condonation, specific dates and times, as
well as full details
regarding the reasons why the application is necessary, are a
necessity. I will return to this later.
[7]
Rule 31, Rule 42(1) and the common law make provision for the
rescission of a judgment. In the present matter, the respondent
acted
in terms of Rule 31(5)(a) in obtaining judgment against the
applicants. Rule 31(5)(d) provides that ”Any party dissatisfied
with a judgment granted or direction given by the registrar may,
within 20 days after such party has acquired knowledge of such
judgment or direction, set the matter down for reconsideration by the
court.” It seems that the applicants seek rescission
of the
default judgment in terms of the common law which obliges them to
have brought the application for rescission within a reasonable
time.
Rule 31(2)(b) stipulates a period of 21 days within which an
application for rescission may be brought, and this, in my view,
is a
good guide as to what may be considered a reasonable time for a
rescission application in terms of the common law. The requirement
of
showing “good cause” must similarly be complied with
whether the application for rescission is brought under Rule
31, Rule
42 or the common law.
[8]
In the matter
Smith No vs Brummer No.
1954 (3) SA 352
(OPD
),
where compliance with certain requirements was stipulated in order
for a court to grant removal of Bar. The following requirements
were
listed at P358A:
(a)
The
Applicant has given a reasonable explanation for his delay
(b)
The
application is bona fide and not made with the object of delaying the
opposite party’s claim.
(c)
There
has not been a reckless or intentional disregard of the Rules of
Court
(d)
The
Applicant’s action is clearly not ill-founded
(e)
Where
prejudice has been caused to the opposite party it must be capable of
being compensated for by an appropriate order as to
costs.
Exactly
the same considerations apply when a rescission of judgment is
sought.
Similar
requirements as in the Smith case were set out in
Du
Plooy v Anwes Motors (Edms) Bpk 1983(4) SA 213(O) at 217H
,
and
Silber
v Ozen Wholesalers (Pty) Ltd 1954(2) SA 345 (A)
which
both counsel referred to in their Heads. In the
Silber
case, the court said at page 352 that “good cause”
includes, but is not limited to the existence of a substantial
defence.
[9]
I shall proceed to examine whether the applicants have discharged the
duty on them to satisfy all the requirements necessary
for the court
to condone their non-compliance with the Rules of Court and to grant
their request for a rescission of the default
judgment in this
matter. As indicated earlier in this judgment, the summons in this
matter was served on the applicants on 7 April
2014 by affixing it to
the gate at their chosen
domicilium
address. Van Zyl, who appears to be the natural person through whom
the Trust operates, alleges that the summons was not received
by any
of the applicants. On 22 April 2014, Van Zyl (calling himself
“Chris”) addressed an e-mail to an employee of
the
respondent, one Ms Esme Leeuw. The e-mail bears a heading entitled
”Dagvaardiging 1493/2014” (dagvaarding is the
Afrikaans
word for summons). In the same e-mail, he indicates that he owes the
respondent R210 649.00 (presumably as opposed to
the R284 222.18
claimed in the summons). The case number under which the summons in
this matter was issued, is reflected as 1493/2014.
It therefore begs
the question how would this case number appear in a communication
from Van Zyl about two weeks after the summons
was served on the
applicants? The logical conclusion is that he must have been aware of
it prior to 22 April 2014, and in my view,
it is not unreasonable to
infer that it would have been on the day the summons was served or
very shortly thereafter.
[10]
As indicated earlier, Van Zyl alleges that the first time he and the
other applicants became aware of the judgment was when
the Sheriff
arrived to attach assets of the Trust on 11 November 2014. On 14
November 2014, the applicant’s attorney addressed
a 3-page
letter to the respondent setting out a detailed version in respect of
the applicants, which could only have come from
Van Zyl or the other
applicants. There was no reason at that stage for the application for
rescission not to have been launched.
These aspects were pertinently
raised in the Answering Affidavit, but no reply was forthcoming to
explain these apparent contradictions
in the version tendered by Van
Zyl in the Founding Affidavit. He also is vague about when counsel
was consulted in this matter,
what “archived” documents
were awaited and from whom and when the papers were prepared in this
matter. These were details
directly within the knowledge of his legal
representatives and the failure to provide such details in the
Founding Affidavit is
telling.
[11]
The applicants allege that a settlement proposal was made in July
2013 on behalf of the respondent by an “alliance”
of the
respondent, Link Finance, which Van Zyl said was accepted and an
amount of R26 984.19 was, as a result, paid into the Trust
Account of
the Trust’s attorney. Two observations arise out of this
allegation, namely that no details are given of which
attorney’s
Trust Account this amount was paid into and secondly, the Trust or
the other applicants have made no further payments
to the respondent
in respect of the lease agreement between the parties since 2012. It
also bears mention that the calculations
by the applicants of the
amount owed to the respondent does not take into account any interest
which the respondent was entitled
to, and did, charge the applicants.
Mr Eksteen validly made the point that the usual business practice of
the respondent is to
charge interest and that the only agreement
relating to a waiver of interest was in respect of the lease
agreement relating to
the 2
nd
trailer. It is therefore opportunistic and unreasonable for the
applicants to say that the respondent waived the payment of all
interest in this matter. It is, furthermore, noteworthy that the
applicants acknowledge being indebted to the respondent, although
the
amount changes from time to time. In the email of 22 April 2014, Van
Zyl acknowledges indebtedness in an amount of R210 649.00,
the letter
from its attorneys, Keet Attorneys, dated 14 November 2014
acknowledges the indebtedness of the Trust to the respondent,
Van Zyl
in his founding Affidavit refers to an amount of R26 984.19 as being
owed to the respondent. I have already dealt with
the lack of logic
in the calculation of this amount.
[12]
In terms of the common law, the applicants are required to show that
good and sufficient cause exists for the default judgment
in this
matter to be set aside. This generally entails three elements which
the applicants must establish: (1) they must give a
reasonable and
acceptable explanation for their default, (2) that the application is
made
bona
fide
and (3) that on the merits they have a bona fide defence which prima
facie has some prospect of success. In summary, the applicants
knew
of the summons since April 2014, they knew about the default judgment
at least since 11 November 2014 and gave detailed instructions
to
their attorney by 14 November 2014. No instruction was given to
launch an application for rescission and no acceptable explanation
is
tendered for this failure. They conflate a dispute relating to the
2
nd
trailer with an alleged defence in respect of the lease agreement
relating to the 1
st
trailer, while admitting indebtedness in respect of the latter
mentioned lease agreement. I also do not accept their assertions
regarding the settlement proposal made by Link Finance. The only
conclusion that can be reached is that the applicants have no
suitable explanation for the delay in bringing this application, that
they brought this application to delay payment of the amount
owed to
the respondent, thus robbing the application of the element of
bona
fides
.
Likewise they have not shown that they have a
bona
fide
defence to the respondent’s claim and have raised spurious and
unfounded defences thereto, which have no prospect of success.
The
principle laid down in the celebrated case of
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984(3) SA 623 (A),
is that an opposed application is approached on the basis that a
final order may be made if those facts averred by the applicant
.that
have been admitted by the respondent, together with the facts alleged
by the respondent, justify such an order, I find that
there are
material factual disputes between the parties. The applicants have,
however not asked for such disputes to be referred
to oral evidence.
In any event, my view is that no useful purpose will be served in
doing so as I am of the view that the applicants
have no defence in
this matter. I am accordingly obliged to accept the respondent’s
version.
ORDER
[13]
In the circumstances, I make the following order:
The
application is dismissed with costs
_____________
S.
NAIDOO, J
On
behalf of Applicants: Mr W
Wannenburg
Instructed
by:
Kramer Weihmann & Joubert Inc
32
Barnes Street
Westdene
BLOEMFONTEIN
(JL
Weihmann/LP/C08389)
On
behalf of Respondent: Mr E Eksteen
Instructed
by:
Phatshoane Henney
35
Markgraaff Street
BLOEMFONTEIN
(Divan
de Jongh)