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[2013] ZAGPPHC 95
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Crown Hill Prop 3 CC v Body Corporate Villa Luca (31765/2011) [2013] ZAGPPHC 95 (11 April 2013)
NOT
REPORTABLE
IN
THE NORTH GAUTENG HIGH COURT, PRETORIA
[REPUBLIC
OF SOUTH AFRICA]
CASE
NUMBER: 31765/2011
DATE:11/04/2013
In
the matter between:
CROWN
HILL PROP 3
CC
….........................................................
APPLICANT
Registration
number: 2004/00850023
and
BODY
CORPORATE VILLA
LUCA
.................................................
RESPONDENT
JUDGMENT
MABENA
AJ:
[1]
This is an application for rescission of a default judgment under
Case number 38392/2010 granted on the 28th February 2011.
[2] BACKGROUND
2.1
The Applicant is an investment vehicle which owns a townhouse known
as Unit 5 of the Sectional Scheme known Villa Luca at 68
South
Street, Centurion, Pretoria.
2.2
The Respondent is a Body Corporate having it’s domicilium
citandi et executandi at Trafalgar Property Management, corner
Beatrix street and Vermeulen street Arcadia Centre, Arcadia,
Pretoria. Trafalgar Property Management (Pty) Ltd is the management
agent of the Respondent.
2.3
Pivotal to this application, is a dispute regarding the monthly
levies payable to the Respondent by the Applicant, which resulted
in
a default judgment and subsequently a liquidation order against the
Applicant, also by default granted on the 28th February
2011 under
case number 38392/2010.
2.4
The initial default judgment was based on arrear rentals allegedly
owed by the Applicant to the Respondent.
2.5
The Respondent issued summons against Applicant during August 2009
for payment of the amount of R 3 985.08. The summons were
served at
the address described as a Shelf Company Warehouse.
2.6
The Applicant allegedly failed to deliver a Notice of Intention to
Defend.
1.1
An application for default judgment was lodged on the 4th September
2009. Default judgment was granted by the Clerk of Pretoria
Magistrate Court on the 21st September 2009.
1.2
A Warrant of Execution was granted on the 10th October 2009.
1.3
Following a Nulla bona return, the Respondent brought an application
for liquidation of the Applicant which was lodged on the
21 July
2010. This application was also served upon the Applicant by affixing
same on the door of the Shelf Company Warehouse.
[3]
The Applicant, in it’s founding affidavit seeks to bring this
application in terms of Rule 42 of the Rules of this Court
as well as
common law. In it’s heads of argument, the Applicant also
relies on the provisions of Section 345 (i) of the Companies
Act 61
of 1973, which provisions, it was submitted, are still applicable in
terms of the Act 71 of 2008, to set aside the liquidation
order.
[4]
The Applicant raises the following as grounds for this application:
4.1
It was not aware of the summons, service and the attempted execution.
It did not have knowledge of the existence of the legal
action
instituted by the Respondent, as the legal process was served at the
address aforementioned.
4.2
It was also not aware of the liquidation application as same was not
served at it’s new domicile.
4.3
Prior to the aforesaid legal action it gave formal notice to the
Respondent of it’s change of domicile;
4.3
The Applicant contends that, had it been aware of the legal actions
against it, it would have opposed the action as it had a
bona fide
defence against the Respondent’s management agent, Trafalgar.
[5]
For an Applicant to succeed in an application for rescission in terms
of Rule 42 (1) (a) or common law, the Applicant is required
to show
“sufficient or good cause” for the setting aside of the
judgment. This means that:
5.1
It must set out a reasonable and acceptable explanation for it’s
failure to deliver a Notice of Intention to Defend or
it’s
failure to deliver a Plea, whichever is applicable;
5.2
Secondly, it must demonstrate that it’s application for
rescission of judgment is bona fide by setting out the grounds
for
it’s defense or claim which prime facie carries some prospects
of success.
[6]
The Applicant, in it’s heads of argument, also contends that,
the liquidation order is liable to be set aside under the
provisions
of section 354 (1) of the companies Act 61 of 1973 (the Act).
[7]
The Applicants under section 354 of the Act must show special
circumstances which justified the setting aside of the order and
also
furnish satisfactory explanations for not having opposed the granting
of the order.
[8]
The Applicant contends that prior to the Respondent instituting an
action against it, a formal notice was dispatched to the
Respondent
notifying of the Applicant’s change of domicile.
[9]
The Respondent does not, in so many words, deny knowledge of the
change of domicile of the Applicant
[10]
It was argued on behalf of the Respondent that Close Corporations and
Companies who owns Sectional Titles used them mainly
as investment
vehicles to generate income. Therefore the occupants of the Sectional
Titles are in almost all maters, tenants. It
was accordingly
contended that if the Sheriff serves the document on the unit at the
domicilium citandi et executandi, that no
representatives of the
owner of Close Corporation and / or Company will be found at the unit
itself. Therefore the Respondent preferred
to serve the document at
the registered address of the Close Corporation or the Company.
[11]
Nowhere in the opposing affidavit does the Respondent deny the
notification of change of domicile by the Applicant. It is my
view
that there is merit in the Applicant’s contention in this
regard. If notification of change of domicile was dispatched
to the
Respondent one would expect that all documents will thereafter be
send to the new domicilium citandi et executandi. I am
satisfied that
the Applicant has provided sufficient reasons that failure to file a
notice of Intention to Defend was not a result
of wilful default on
it’s part.
[12]
On the question of bona fide defense, the Applicant raises the
following defences on the merit:
12.1
That levies fell in arrears because the Respondent’s managing
agent Trafalgar failed in spite of numerous reminders to
update it’s
administrative records to present the Applicant’s debit order
to the bankers for deduction of levies against
the nominated account
where the monies were available.
12.2
That the Applicant furthermore, took steps to pay to Trafalgar all
the amount of levies claimed to be outstanding in the amount
of R 15
260.95.
12.3
The Applicant furthermore deposited in favour of Respondent the
amount of R 23 283 .42 of which the amount of R 8 000. 00 is
in trust
with the Applicant’s attorneys, Machobane Kriel Inc as security
to any action that maybe instituted by the Respondent.
12.4
That the only reason why the Respondent was not successful in
recovering the levies from the Applicant was occasioned by Trafalgar
as aforesaid.
[13]
The Respondent denies that they are responsible for the Applicant’s
levies falling into arrears. However, it is contended
and it was so
submitted on behalf of the Respondent that:
....“the
reason that the debit order did present itself of payment is unclear
and can be the cause of limitless reasons but
the statement notes
that the account was closed. (paragraph 13.9 Respondent’s
opposing affidavit)”
[14]
The Respondent denies having received Annexure “HK6” and
“HK7”, as they alleged that these Annexures
were
supported fax reports and prove is given that same is delivered by
hand.
[15]
I am satisfied that Annexures “HK6” and “HK7”
comprised legitimate notification to the Respondent that
the debit
order was not presented for payment.
[16]
I am satisfied that the Applicant, has advanced sufficient facts to
demonstrate that it has a bona fide defence and it has
accordingly
shown good cause for the setting aside of the liquidation order
granted by default on the 28th February 2011 under
Case number
38392/2010. I do not deem it necessary to deal with the question
whether or not the Respondent is entitled to claim
the legal fees
prior to taxation thereof.
[15]
I make the following order:
1.
The application for rescission of judgment is upheld;
2.
The liquidation order granted under Case number 38391/2010 is set
side;
3.
The Respondent is ordered to pay cost of suit.
MH
MABENA ACTING JUDGE
NORTH
GAUTENG HIGH COURT PRETORIA