Pogostich Business Brokers (Pty) Ltd and Another v Mcleod and Another (247/06) [2006] ZASCA 110; [2006] SCA 136 (RSA) (21 November 2006)

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[2006] ZASCA 110
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Pogostich Business Brokers (Pty) Ltd and Another v Mcleod and Another (247/06) [2006] ZASCA 110; [2006] SCA 136 (RSA) (21 November 2006)

THE
SUPREME COURT OF APPEAL
OF
SOUTH AFRICA
Unreportable
Case no: 247/06
In
the matter between:
POGOSTICH
BUSINESS BROKERS (PTY) LTD
First Applicant/Appellant
COLIN
FENN
Second Applicant/Appellant
and
KENNETH
MCLEOD
First Respondent
RYAN
MCLEOD
Second Respondent
________________________________________________________________
Coram
:
Zulman,
Streicher, Cameron, Navsa JJA et Theron AJA
Date of hearing:
7 November 2006
Date of delivery:
21 November 2006
Summary
: Application
to reinstate lapsed appeal ─ after noting appeal applicants decided
to abide by an adverse judgment and deliberately
elected to take no
further steps in its prosecution ─ more than eight months passed
from the time of the noting of the appeal until
the record was lodged
─ the fact that the correctness of the decision may be open to
debate is not sufficient ground to reopen
the dispute.
Neutral citation:
This judgment may be referred to as
Pogostich v McLeod
[2006]
SCA 136 (RSA).
_______________________________________________________
JUDGMENT
_______________________________________________________
NAVSA JA
NAVSA JA:
[1] We are faced with an application
to reinstate an appeal that had lapsed for failure to lodge an appeal
record timeously. Put differently,
we are dealing with an application
to condone the late lodging of the record.
1
[2] On 8 June 2004 the Johannesburg
High Court (Mailula J), at the instance of the two respondents (the
McLeods), ordered the attachment
of funds totalling R1 263 358.62
held in the first applicant’s bank account with the South African
Bank of Athens pending
the finalisation of an action to be instituted
against two peregrine defendants, namely, Patrick Mantle and Ozden
Mantle (the Mantles).
Furthermore, the first and second applicants
were interdicted from withdrawing the moneys concerned from the
account pending the
finalisation of the said action.
[3] The second applicant is a
chartered accountant who has control over the bank account of the
first applicant. The McLeods had sought
the orders to confirm
jurisdiction in the contemplated action and to prevent dissipation of
the funds. They alleged that the Mantles
had made certain fraudulent
misrepresentations to them which induced them to enter into a bogus
transaction in terms of which they
paid R1.2m to the Mantles who then
disappeared with the money to the United Kingdom.
[4] The McLeods who are father and son
alleged that the money in the account was the proceeds of the sale of
immovable property that
the Mantles had sold ─ thus the money
belonged to the Mantles. This was disputed by the applicants. They
alleged that the money
standing to the credit of the first
respondent’s account belonged to the second applicant’s siblings,
Martin Fenn and Robynne
Troskie. At material times the second
applicant had power of attorney from the Mantles in respect of the
proceeds of the sale of
the immovable property.
[5] On the question of the ownership
of the money Mailula J found in favour of the respondents and
consequently ordered the attachment.
The learned judge also rejected
contentions by the applicant, first, that there had not been proper
attachment on the authority of
an interim order, and second, that
there had been a consent to jurisdiction by the Mantles before the
attachment obviating the need
for an attachment.
[6] On 30 January 2005
Mailula J refused the applicants leave to appeal against her
judgment. On 29 July 2005
this court granted the applicants
leave to appeal to it. The appeal was noted on 26 August 2005.
In terms of rule 8(1)
of the rules of this court the appeal record
ought to have been lodged by 26 November 2005 ie within
three months of the
notice of appeal. This was not done.
[7] It is necessary at this stage to
deal with what occurred from August onwards. During August 2005 the
McLeods’ attorneys, through
other legal proceedings, succeeded in
withdrawing the funds from the account in question. This led to an
unsuccessful application
by the applicants in the Johannesburg High
Court (Horn J) to have these funds returned to the account. The
applicants were dispirited
by the successive failures in that court
and became locked in a dispute with their then attorneys concerning
payment of the latter’s
fees and engaged in acrimonious exchanges
concerning the quality of the legal advice they had received.
[8] On 16 November 2005 the
second applicant’s attorneys hand-delivered a letter advising him
that applicants’ prospects
of success on appeal against the
judgment of Mailula J were good. They notified him that in order to
prosecute the appeal a record
had to be prepared and lodged before
the end of the month but stated that because of the dispute about
fees they were unable to do
so. In his affidavit in support of
condonation the second applicant stated that he realised that the
failure to lodge the record
within the time prescribed by rule 8(1)
would result in the lapsing of the appeal.
2
He stated further that he believed that since the record had not been
lodged timeously the appeal could not be revived.
[9] According to the applicants they
were disillusioned with their attorneys and considered that no
further purpose would be served
by continuing with the appeal against
the judgment of Mailula J or with any related litigation. The second
applicant recorded this
in a letter to the attorneys dated
18 November 2005, the relevant part of which reads as
follows:
‘
In any event as you
are aware the moneys have already been taken by Louis [the McLeods’
attorney] and there appears to be no good
purpose in proceeding with
this matter other than be liable, which I deny for legal costs. There
is no further moneys in the bank
account and Pogostich has no assets
and nor do I.’
[10] The second applicant states that
on 6 April 2006, when he consulted with his new attorney
and counsel in relation to
another matter, he was advised that the
appeal could in fact be revived. It was only then that he gave
instructions that steps should
be taken to have the appeal
reinstated. The record was eventually lodged on 19 May 2006,
more than eight months after the
appeal was noted ─ more than
double the three-month period provided in rule 8(1) for the lodging
of a record.
[11] In
Cairn’s Executors v Gaarn
1912 AD 180
at 183 Innes J dealt with a matter in which no steps had
been taken in the prosecution of an appeal for more than one year. He
said
the following about the court’s power of condonation in terms
of the rules of court:
‘
The language used is
very general, and leave to this Court a wider discretion than that
allowed under some of the statutory and other
provisions to which
reference has already been made. But still its effect is to throw
upon the applicant in each instance the duty
of making out a case for
relief. The time prescribed for appeal having lapsed, the successful
party has an interest in the judgment
of which his opponent can only
deprive him by satisfying the Court that “sufficient cause”
exists to justify the favourable exercise
of its discretion under the
rule.’
At 185-186 he stated:
‘
But all we have to
consider now is whether sufficient cause has been shown for granting
an extension of time for appealing against
a finding which the party
aggrieved has accepted as final for more than a year. . . .It is
enough to say that where a party had decided
to abide by an adverse
judgment and has deliberately elected to take no steps for a period
of more than twelve months after the time
allowed for appealing, the
mere fact that the correctness of the decision is open to question is
not sufficient ground for allowing
him to reopen the dispute. Under
all the circumstances, therefore, I am of opinion that this
application should be refused with costs.’
[12] In the present case, after the
noting of the appeal on 26 August 2005, nothing further was
done in pursuance of the
appeal until 6 April 2006. No
satisfactory explanation is proffered as to why nothing was done to
prosecute the appeal from
26 August 2005 to the beginning
of November 2006. The second appellant’s attorneys wrote to
him on 16 November
2005 that they had ‘made innumerable
efforts to no avail to contact [him]’ and that they had written to
him ‘in order to enquire
when [they] could expect to receive
payment of [their] account in order to enable [them] to proceed with’
this matter and another
matter. It was also in this letter that they
pointed out that the record had to be filed by the end of the month.
However, the appellants
still did not do anything to prosecute the
appeal, notwithstanding the advice by their attorneys that their
prospects in the appeal
were good and also the fact that they could
have obtained legal advice from their present attorney in November
when they consulted
him in respect of other matters. The reason why
the appellants did not prosecute the appeal at least from November
onwards appears
from the second appellant’s letter dated
18 November 2005 ─ that is that they deliberately elected
to accept and abide
the judgment of Mailula J.
[13] It is true that in resolving the
dispute of fact concerning the ownership of the money in the account
Mailula J adopted a robust
approach in ruling in favour of the
respondents. Like her, we have serious reservations about the
veracity of the applicants’ version
concerning the ownership of the
funds. However, having regard to the
dicta
quoted in para [11]
and applying them to the facts of this case it is not necessary to
debate that, or any other issue, in relation
to the correctness of
the order of Mailula J.
[14] The following order is made:
1. The application for reinstatement
of the appeal is refused with costs.
_________________
M S NAVSA
JUDGE OF APPEAL
CONCUR:
ZULMAN JA
STREICHER JA
CAMERON JA
THERON AJA
1
See rule 11 of the rules of this Court in terms
of which the court may
mero motu
or on application, extend or
reduce any time period prescribed and may condone non-compliance
with these rules.
2
Rule 8(3) of the rules of this Court states that
failure to lodge the record within the prescribed period of 3 months
or within
an extended period as permitted by the Registrar or
agreement between the parties results in the lapsing of the appeal.