Macsteel Tube and Pipe, a division of Macsteel Service Centres SA (Pty) Ltd v Vowles Properties (Pty) Ltd (680/2020) [2021] ZASCA 178 (17 December 2021)

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[2021] ZASCA 178
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Macsteel Tube and Pipe, a division of Macsteel Service Centres SA (Pty) Ltd v Vowles Properties (Pty) Ltd (680/2020) [2021] ZASCA 178 (17 December 2021)

THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Not reportable
Case No: 680/2020
In the matter
between:
MACSTEEL TUBE AND
PIPE, A DIVISION OF
MACSTEEL SERVICE
CENTRES SA (PTY) LTD
APPELLANT
and
VOWLES
PROPERTIES (PTY)
LTD
RESPONDENT
Neutral
Citation:
Macsteel
Tube and Pipe, a division of Macsteel Service Centres SA (Pty) Ltd v
Vowles Properties (Pty) Ltd
(680/2020)
[2021] ZASCA 178
(17 December 2021)
Coram:
MATHOPO, MOCUMIE and MOLEMELA JJA,
and KGOELE, and MOLEFE AJJA
Heard:
4 November 2021
Delivered:
This judgment was handed down electronically by
circulation to the parties’ legal representatives by email,
publication on the Supreme
Court of Appeal website and released to
SAFLII. The date and time for hand-down is deemed to be 10h00 on 17
December 2021
Summary:
Civil Procedure and
Practice – an order amending the quantification of the claim in a
summons did not amount to a new cause of action
and did not
constitute a final determination on the issue of the court’s
jurisdiction to adjudicate the action – an order amending
the
description of a defendant in a summons does not amount to a
substitution of the defendant in circumstances where the description
of the defendant was the same as in the lease agreement concluded by
the parties – no prejudice was demonstrated by the appellant
–
application to amend was correctly granted – appeal dismissed.
ORDER
On
appeal from
:
Gauteng Division of the High Court, Johannesburg (Mia J and Malungana
AJ sitting as a court of appeal):
The
appeal is dismissed with costs.
JUDGMENT
Molemela JA
(Mathopo and Mocumie JJA and Kgoele and Molefe AJJA concurring):
[1]
This
appeal arises from an interlocutory application pertaining to the
amendment of the particulars of claim in an action that was
instituted by Vowles Properties (Pty) Ltd (Vowles) against Macsteel
Tube and Pipe, a Division of Macsteel Service Centres SA (Pty)
Ltd
(Macsteel).
[1]
The
background facts which serve as a backdrop for the adjudication of
this appeal are set out in the paragraphs that follow.
[2]
On 26 July 2009, Vowles and Macsteel concluded a
lease agreement in terms of which the latter leased the former’s
fixed property
which was to be utilised for steel fabrication and
storage, among others. One of the terms of the agreement was that
Macsteel was
required to maintain the leased premises in good order
and could not sublet the leased premises without Vowles’ consent.
On 11
December 2015, Vowles instituted action in the Kempton Park
Regional Court (the regional court) against Macsteel. It is common
cause
that the lease terminated on 31 December 2012. In its
particulars of claim, Vowles claimed an amount of R1 567 096.03
as
damages for breach of contract on the basis that Macsteel had
breached the terms of the agreement by failing to return the leased
premises in the same condition as they were when it first took
occupation thereof. Macsteel is the appellant in this appeal, and
Vowles the respondent. A second party, Reclamation Holdings (Pty)
Ltd, which was the appellant’s tenant in terms of a subletting
arrangement, was cited as a co-defendant in the particulars of claim.
The subletting arrangement need not detain this appeal, because
the
appellant’s tenant is not a party before us.
[3]
Macsteel excepted to the particulars of claim. On
15 July 2016, the regional court, by agreement between the parties,
upheld the exception
raised by Macsteel. In terms of that order (the
July 2016 order), the original particulars of claim were set aside
and Vowles was
ordered to file amended particulars of claim within 20
days of the July 2016 order. The first time that Vowles attempted to
amend
the particulars of claim was when on 9 September 2016, more
than 20 days after the issuance of the July 2016 order, it delivered
a notice of amendment in terms of rule 55A of the Magistrates’
Court Rules (the first rule 55A(1) notice) pursuant to being served
with a notice of bar. Macsteel objected to the amendment on the basis
that the particulars of claim no longer existed, as they had
been set
aside in terms of the July 2016 order. It sought an order dismissing
Vowles’ action, alternatively setting aside Vowles’
notice of
amendment.
[4]
On 24 January 2017, the regional court granted an
order setting aside the notice of amendment filed by Vowles as an
irregular step.
On 20 February 2017, Vowles delivered its second
notice of amendment in terms of rule 55A(1) (the second rule 55A(1)
notice). Macsteel
again objected, as result of which Vowles withdrew
that notice. On 27 October 2017, Vowles filed another notice of
amendment, this
time stating that the application was within the
contemplation of rule 55A(4) (the October 2017 amendment
application). The notice
stipulated that Vowles intended to make its
application on 2 February 2018 at 09h00. However, on 30 January 2018,
Vowles’ attorneys
filed a notice of withdrawal as attorney of
record. Vowles did not attend the proceedings on 30 January 2018, as
a result of which
the regional court dismissed that application with
costs.
[5]
On 19 June 2018, Vowles, having appointed new
attorneys of record, delivered a Notice of Motion (the 2018 amendment
application) indicating
its intention to, in terms of s 111(1) of the
Magistrates’ Court Act 32 of 1944 (Magistrates’ Court Act),
alternatively in terms
of rule 55A(10), amend the summons by
replacing it with a copy appended to the Notice of Motion as Annexure
A. Vowles sought a number
of orders in the alternative, including an
order declaring the proposed amendment as being an amendment of the
particulars of claim
in compliance with the July 2016 order. Macsteel
opposed the application and raised a number of objections, including
its previous
objections.
[6]
Furthermore, Macsteel contended that Vowles had
not brought its application in terms of rule 55A(1), which was the
ordinary manner
in which such applications are brought and had
instead elected to bring this application under the rule 55A(10).
Although Macsteel
accepted that it was within the discretion of the
court to grant applications under this sub-rule, it contended that
because Vowles
had not explained in its founding affidavit why it
elected to follow this route, and not the usual procedure for
amendments, as set
out in rule 55A(1), there was no basis for the
regional court to conclude that it should exercise its discretion in
favour of Vowles
and grant the June 2018 amendment.
[7]
On 24 October 2018, the regional court granted
Vowles leave to amend the particulars of claim and ordered Macsteel
to pay the costs
of the application. Macsteel was aggrieved by that
order and noted an appeal on the basis that the regional court had
made findings
which were final in effect, which would prejudice
Macsteel’s conduct in defending Vowles’ claim. On 21 November
2018, Macsteel
noted an appeal against the whole of the judgment and
order of the regional court except the costs order. Before the
Gauteng Division
of the High Court, Johannesburg
(the
high court), sitting as a full court, Macsteel submitted that the
regional court had erred in allowing the amendment of the particulars
of claim. According to Macsteel, Vowles’ application to amend its
particulars of claim should have been dismissed. The high court
rejected that contention and dismissed the appeal with costs on 20
April 2020. Aggrieved by that order, Macsteel approached this
Court
seeking special leave to appeal against the order of the high court.
Special leave was granted by this Court on 28 July 2020.
[8]
The main issues raised for adjudication in this appeal are whether
the regional court
made a definitive order that cannot be altered in
relation to jurisdiction and, in particular, whether the amendment
sought had the
effect of introducing a new cause of action or a new
party in relation to a claim that had prescribed. An ancillary issue
raised
for determination related to whether or not the order granted
by the regional court was appealable.
[9]
Section 111 of the Magistrates’ Court Act is relevant to this
appeal. It provides
that a court may at any time before judgment,
amend any summons or pleading, if the granting of the amendment will
not prejudice
any party in the conduct of that party’s action or
defence. There is a plethora of case-law on the subject and it is now
well-established
that a court will always allow an amendment unless
the amendment is
mala
fide
or if the amendment would cause prejudice to the other side, which
prejudice cannot be cured by a costs order. This principle was
formulated as follows in the well-known case of
Moolman
v Estate Moolman and Another
[2]
and was confirmed in numerous judgments of this Court:
‘
.
. . [T]he practical rule adopted seems to be that amendments will
always be allowed unless the application to amend is
mala fide
or unless such amendment would cause an injustice to the other side
which cannot be compensated by costs. . . .’
[10]
Against the backdrop of the legal position set out in the preceding
paragraph, I turn now to deal with
the issues raised in this appeal.
It is opportune to start with the ancillary issue of the
appealability of the order made by the
regional court. It was
contended on behalf of Vowles that the order granted by the regional
court did not have the effect of a final
judgment and was
consequently not appealable.
[3]
We were
accordingly urged to strike the appeal from the roll with costs.
[11]
It is trite that an appeal lies against an order and not against the
reasoning. In
Zweni
v Minister of Law
,
[4]
and Order
this Court
held:
‘
A
“judgment or order” is a decision which, as a general principle,
has three attributes, first, the decision must be final in
effect and
not susceptible of alteration by the court of first instance; second,
it must be definitive of the rights of the parties;
and, third,
it must have the effect of disposing of at least a substantial
portion of the relief claimed in the main proceedings
(Van
Streepen & Germs (Pty) Ltd
case
supra
at
586I-587B;
Marsay
v Dilley
1992
(3) SA 944 (A)
962C-F).
The second is the same as the oft-stated requirement that a decision,
in order to qualify as a judgment or order, must grant
definite and
distinct relief
(Willis
Faber Enthoven (Pty) Ltd v Receiver of Revenue &
Another
[1991] ZASCA 163
;
1992
(4) SA 202
(A)
at
214D-G).’
[12]
It is true that the refusal of an amendment may have a final and
definitive effect because a party may
be precluded from leading
evidence at the trial in respect of the aspects which were to be
introduced by the amendment of the pleadings.
However, the granting
of an amendment does not, without more, have that effect. Ordinarily,
an order granting leave to amend is an
interlocutory order which is
not final and definitive of the rights of the parties.
[13]
A perusal of the order granted by the regional court does not suggest
that the order it granted had a
final effect. However, given
Macsteel’s contention that some of the findings made by the
regional court were definitive of the
parties’ rights and were
final in effect, it may be necessary to consider the reasoning that
informed its decision. In doing so,
it must be borne in mind that
some of the remarks were made in the course of that court addressing
itself to the controversy about
whether the grounds of objections
raised by Macsteel against the proposed amendment manifested
prejudice that was likely to hinder
Macsteel in its defence of the
claim. I consider next the four grounds of objections raised by
Macsteel as considered by the regional
court.
[14]
The first ground of objection was directed at the jurisdiction of the
regional court to adjudicate the
claim beyond its monetary threshold.
Section 45(1) of the Magistrates Court Act
[5]
permits the
parties to a contract to consent in writing to the adjudication of
their contractual dispute in either the court for the
district or the
court for the regional division in respect of an action which would
ordinarily fall beyond the jurisdiction of those
courts. The regional
court recorded that Vowles had referred it to clause 20 of the lease
agreement, which stipulated as follows:
‘
The
both parties hereby consents to the jurisdiction of the Magistrate’s
Court (for the district having physical jurisdiction over
the person
of the LANDLORD) in respect of all proceedings arising out of this
AGREEMENT OF LEASE, notwithstanding the amount claimed
or the nature
of the claim. In no way derogating there from the LANDLORD shall be
entitled to institute any action arising out of
this AGREEMENT OF
LEASE in any other court of competent jurisdiction’.
[15]
The regional court then stated as follows on this aspect:
‘
The
respondent has argued that in terms of the first two lines in this
clause, that this Court is not the district court and that
the
district having physical jurisdiction over with the person of the
landlord, who is in fact the applicant, is in fact Benoni Court.
Of
course the applicant has disagreed with this contention and I shall
say no more, except to say the following: The district of Benoni,
did
at the time of institution of this summons, fall under the Regional
Court of Kempton Park.
Additionally,
the clause is wide enough to include any competent court and the
applicant is then free to even persist in high court
if he so wishes.
There is no merit in this first ground of objection raised by the
respondent.’
In
my view, the regional court merely recognised the existence of a
clause in the parties’ agreement purportedly clothing a court
in
the district having physical jurisdiction over Vowles, with the
jurisdiction to adjudicate the action, but did not finally determine
the issue of jurisdiction. The dismissal of this ground of objection
appears to have been on the basis that the issue of jurisdiction
could not, given clause 20 of the lease agreement, serve as a bar to
granting the amendment. Thus, nothing precluded Macsteel from
subsequently raising the issue of jurisdiction as a point
in
limine
. It follows that this ground of appeal has no merit.
[16]
The second ground of objection was that the augmentation of the
amount of the claim was tantamount to
introducing a new cause of
action. There is no merit to this contention. A plaintiff is not
precluded from augmenting its claim for
damages if the new claim
merely represents a fresh quantification of the original claim.
[6]
It follows
that this ground of appeal also has no merit.
[17]
In its third ground of objection, Macsteel asserted that the
amendment of the citation of Macsteel introduced
a new legal entity
as a defendant in circumstances where the claim had prescribed.
Macsteel took issue with the fact that the amended
particulars of
claim cited the defendant as ‘Macsteel Tube and Pipe Ltd, a
division of Macsteel Service Centres SA (Pty) Ltd. Macsteel
submitted
that insofar as Vowles had included the phrase ‘a division of’ in
Macsteel’s citation, it had actually cited a non-existent
party.
Macsteel further argued that Vowles was attempting to introduce a new
defendant, namely ‘Macsteel Services Centres SA (Pty)
Ltd trading
as a division thereof in the name of Macsteel Tube and Pipe’ as a
new defendant in the place of a non-existent one.
Macsteel contended
that the regional court’s observation that the citation of the
defendant matched the description of Macsteel
in the lease agreement,
that the citation referred to the trading name of a defendant who was
easily identifiable was definitive
of the parties’ rights and was
also final in effect.
[18]
The regional court’s finding that the correction of the cited
defendant is not tantamount to introducing
a new party to the
proceedings finds support in
Foxlake
Investments (Pty) Ltd t/a Foxway Developments v Ultimate Raft
Foundation Design Solutions CC t/a Ultimate Raft Design and
Another
(Foxlake)
,
where this Court stated as follows:
[7]
‘
As
stated earlier, Foxway and Foxlake share the same registered address,
receptionist and managing director. The copy of the agreement
on
which the claim is based was attached to the original summons. In my
view when the summons was served on the registered address
of both
Foxway and Foxlake, Foxway recognised its connection with the claim
notwithstanding the error in its description. The amendment
sought by
the respondents in the court a quo did not seek to introduce a new
legal entity as the first defendant. It merely sought
to correct the
incorrect description of the defendant and encourage the proper
ventilation of the real disputes between the creditor
(the
respondents) and the debtor (appellant). The question of prejudice to
the appellants does not arise. The summons was served
on the true
debtor in which summons the creditor was claiming payment of the debt
from the debtor.’
[19]
The facts in the
Foxlake
judgment
bear many similarities with the present matter. The regional court’s
observation that the citation in the original particulars
of claim
matches the description in the lease agreement is borne out by the
lease agreement. Macsteel’s address was exactly the
same in both
the original summons and the proposed amendment. The regional court’s
finding that the defendant is easily identifiable
cannot be faulted.
By parity of reasoning, in this matter, Macsteel’s objection to the
amendment of its citation was ill-conceived
because the amendment of
the citation was merely intended to align Macsteel’s description in
the summons to the description in
the lease agreement. The question
of prejudice therefore did not arise.
[20]
Given the following remarks of this Court in
Blaauwberg
,
[8]
there can be
no doubt about the fallacy of Macsteel’s contentions that the
defendant cited in the original summons was a non-existent
party and
that the defendant cited in the proposed amendment introduced a new
legal entity:
‘
While
the entitlement of the debtor to know it is the object of the [court]
process is clear, in its case the criterion fixed in s
15(1) is not
the citation in the process but that there should be service on the
true debtor (not necessarily the named defendant)
of process in which
the creditor claims payment of the debt. . . Presumably this is so
because the true debtor will invariably recognise
its own connection
with a claim if details of the creditor and its claim are furnished
to it, notwithstanding any error in its citation.’
It
is clear from this passage, and the passage in
Foxlake
quoted in the preceding paragraph, that even if it
were to be accepted in Macsteel’s favour that the regional court’s
finding
(that the amendment did not introduce a new defendant) was
indeed final in effect, these judgments deal a fatal blow to any
prospects
of success on an appeal directed at this leg of Macsteel’s
objection.
It is plain that Macsteel
recognised its connection with the
claim notwithstanding that it considered the citation to be flawed.
It follows that this ground
of appeal also has no merit.
[21]
The fourth ground of objection was that the proposed amendment
violated the July 2016 order, as the original
particulars of claim
had been set aside. Macsteel contended that in terms of the July 2016
order, Vowles was obliged to re-issue
fresh particulars of claim as
opposed to amending them. This contention has no merit. It must be
borne in mind that although Macsteel’s
exception was upheld, the
regional court specifically ordered that
amended
particulars of claim be filed (within 20 days). The fact that the
particulars of claim were set aside and were to be substituted
with
amended particulars of claim did not mean there was no longer a
pending action between Macsteel and Vowles. Significantly, Vowles
asked the regional court to condone the late filing of its
application to amend the particulars of claim; the regional court,
within
its discretion, condoned the delay.
[22]
Furthermore, Macsteel’s contention that summons was to be re-issued
is negated by the fact that in
its notice of bar, it invited Vowles
to file its amended particulars of claim within five days. Logically,
it would not have asked
for the filing of amended particulars of
claim if its understanding of the order was that Vowles was obliged
to re-issue particulars
of claim. Further and in any event, to the
extent that Macsteel averred that a prescribed cause of action was
introduced by the substitution
of the particulars of claim, nothing
precluded Macsteel from raising a special plea of prescription when
filing its plea. It follows
that the contention that the regional
court made a final determination in relation to prescription has no
merit.
[23]
As stated before, prejudice is a key consideration in the
determination of an application for amendment
of pleadings. Macsteel
failed to present facts showing the prejudice it stood to suffer on
account of the proposed amendment. No
prejudice could be established
from the objections raised by Macsteel. Since no prejudice was shown,
nothing stood in the way of
the regional court granting the
amendment. It remains now to consider the issue of the discretion
exercised by the regional court
in deciding whether or not to grant
the amendment.
[24]
It is trite that applications for amendment of pleadings are
regulated by a wide and generous discretion
which leans towards the
proper ventilation of disputes.
[9]
Furthermore,
amendments ‘will always be allowed unless the amendment is
mala
fide
(made in bad faith) or unless the amendment will cause an injustice
to the other side which cannot be cured by an appropriate order
of
costs, or “unless the parties cannot be put back for the purposes
of justice in the same position as they were when the pleading
which
it is sought to amend was filed”.’
[10]
The regional
court’s exercise of its discretion is evident from the following
passage in its judgment:
‘
The
granting [or] refusing of an amendment is a matter of the Courts
discretion and of course it must be applied judiciously. The
tendency
in courts has generally been to allow an amendment if it can be done
with no prejudice to the other side and it is true
that the Courts
approach applications in terms of rule 55(a), a little bit more
charitably.’
[25]
It is unnecessary for purposes of this appeal to determine whether
the
discretion exercised by the regional court in granting the amendment
brought in terms of rule 55(10) was a discretion in the true
sense or
the loose sense.
It suffices merely to state that regardless of the nature of the
discretion, the regional court’s decision ought not to be
interfered
with lightly on appeal.
[11]
[26]
Insofar as Macsteel contended that it would be prejudiced by the
granting of the amendment because of
Vowles’ inordinate delay in
bringing its application for amendment of its particulars of claim,
it bears noting that a litigant’s
delay in bringing forward its
amendment is not a ground for refusing the amendment.
[12]
This is all
the more so in circumstances where the injustice to the other side
can be cured by an appropriate order of costs.
[13]
[27]
In this matter, the regional court considered the inordinate delay in
bringing the application and bemoaned
the ‘. . . inordinate stops
and starts to get the matter off the ground. . . ’. Having
concluded that there was no demonstrable
prejudice that could not be
cured by an appropriate order of costs, it granted the amendment but
ordered Vowles to pay the costs
of the application on an attorney and
client scale. On the strength of the authorities mentioned in the
preceding paragraph, I am
satisfied that there is nothing to suggest
that the regional court’s decision to condone the delay and grant
the amendment was
not preceded by a judicial exercise of that court’s
discretion. In my view, that decision cannot be faulted. That being
the case,
it follows that the high court correctly dismissed the
appeal. For all the reasons mentioned in the foregoing paragraphs,
the appeal
has no merit and falls to be dismissed.
Order
[28]
The appeal is dismissed with costs.
M
B MOLEMELA
JUDGE
OF APPEAL
APPEARANCES
For
appellant:

A C McKenzie
Instructed
by:

Webber Wentzel, Sandton
Symington
De Kok Attorneys, Bloemfontein
For
respondent:

A P Bruwer
Instructed
by:

Schalk Britz Inc, Benoni
Honey
Attorneys, Bloemfontein.
[1]
This
is how Macsteel was cited in the face of the original summons. In
its proposed amendment, Vowles sought the substitution of
that
description with the following citation: ‘Macsteel Service Centres
SA (Pty) Ltd t/a Macsteel Tube and Pipe, a private company
duly
registered and incorporated in terms of the Company Laws of the
Republic of South Africa, conducting business at 15 Esson
Road,
Lillianton, Boksburg’.
[2]
Moolman
v Estate Moolman and Another
1927 CPD 27
at 29.
[3]
Relying
on the provisions of s 83 of the Magistrate’s Court Act 32 of
1944, it was contended on behalf of Vowles that the granting
of the
amendment is not a judgment within the contemplation of s 48 of the
Magistrates Court Act. The right of appeal, so it was
contended, is
limited to the provisions of s 83
(b)
which stipulates that a party has the right to appeal against any
rule or order ‘having the effect of a final judgment’.
[4]
Zweni
v Minister of Law and Order;
1993
(1) SA 523
(A);
[1993] 1 All SA 365
(A) para 8.
[5]
Section
45(1) provides: ‘Subject to the provisions of section 46, the
parties may consent in writing to the jurisdiction of either
the
court for the district or the court for the regional division to
determine any action or proceedings otherwise beyond its

jurisdiction in terms of section 29(1).’ The matters excluded by s
46 include matters pertaining to the validity of a will, status
of a
person in respect of mental capacity, specific performance without
the alternative of damages, delivery of property exceeding
a certain
value, and a decree of perpetual silence.
[6]
See Jones & Buckle
The
Civil Practice of the Magistrates’ Courts in South Africa –
Volume 1: The Act
10
ed (2012) p691.
[7]
Foxlake
Investments (Pty) Ltd t/a Foxway Developments v Ultimate Raft
Foundation Design Solutions CC t/a Ultimate Raft Design and
Another
(Foxlake)
[2016]
ZASCA 54
para 14.
[8]
Blaauwberg
Meat Wholesalers CC v Anglo Dutch Meats (Exports) Ltd
[2003]
ZASCA 144
;
2004 (3) SA 160
SA para 18.
[9]
Fn 8
above para 8.
[10]
Affordable
Medicines Trust and Others v Minister of Health and Another
[2005] ZACC 3
;
2005 (6) BCLR 529
(CC);
2006 (3) SA 247
(CC) para 9.
[11]
Trencon
Construction Pty (Ltd) v Industrial Development Corporation of South
Africa Limited and Another
[2015]
ZACC 22
;
2015 (10) BCLR 1199
(CC);
2015
(5) SA 245
(CC)
paras
83-88.
[12]
See fn
8 above para 9.
[13]
See fn 10
above para 9.