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[2012] ZAGPPHC 7
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Slip Knot Investments 777 (Pty) Ltd v Autumn Star Trading 739 (Pty) Ltd and Others (49021/2010) [2012] ZAGPPHC 7 (10 January 2012)
NOT
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG, PRETORIA)
CASE
NO: 43021/2010
DATE:10/01/2012
In
the matter between:
SLIP
KNOT INVESTMENTS 777 (PTY)
LTD
...........................................................
APPLICANT
and
AUTUMN
STAR TRADING 739 (PTY)
LTD
..................................................
1st
RESPONDENT
DAWID
CORNELIUS
MAREE
.....................................................................
2nd
RESPONDENT
BAREND
GABRIEL
MEYER
......................................................................
3RD RESPONDENT
NEW
CENTURY HOMES (PTY)
LTD
...........................................................
4th
RESPONDENT
JUDGMENT
HIEMSTRA
AJ
[1]
The applicant seeks an order against the respondents, jointly and
severally, for payment of certain sums of money together with
interest and costs pursuant to a loan agreement concluded between the
applicant and the first respondent on 25 June 2007, secured
by a deed
of suretyship signed by the second, third and fourth respondents.
[2]
After this application was launched, the first respondent was
provisionally liquidated. In terms of s 359 of the Companies Act,
61
of 1973, all civil proceedings by or against the company are
suspended until the appointment of a liquidator. It has been held
that, despite the definition of "liquidator" in s 1 of the
Act, which includes a provisional liquidator, that in the
context of
s 359 "liquidator" means a finally appointed liquidator.
Since the first respondent has not yet been finally
liquidated, the
proceedings remain suspended. This was acknowledged by counsel for
the applicant and he proceeded against the second,
third and fourth
respondents only, and asks that the proceedings against he first
respondent be post- pone sine die.
[3]
The suspension of the proceedings against the first respondent has no
effect on the proceedings against the sureties. S 359
has been
enacted for the benefit of the liquidator and only the liquidator can
raise the operation of the section as a defence.
The surety has no
locus standi to do so.
1
[4]
The liability of the sureties depends on validity of the claim
against the first respondent as the principal debtor. It is therefore
necessary to determine whether the first respondent is liable. The
liability of the first respondent is disputed.
[5]
The first respondent required the loan as bridging finance in respect
of various phases of the development of Wena Ka Mina,
namely Portion
39 (a portion of portion 22) of the farm Witfontein No 31,
Registrations Division JR, Province of Gauteng. The phases
of the
development are the following:
1.
First phase: The development of the first 138 units of the
development.
2.
Second phase: The development of a further 189 units of the
development;
3.
Third phase: The development of a further 150 units of the
development. [6] Advances on the loan are scheduled in clause 3 as
follows:
1.
An amount equivalent to the amount required to cancel an existing
mortgage bond in favour of ABSA Bank Ltd, which amount may
not exceed
R5 050 000.00;
2.
An amount equivalent to the amount required to cancel an existing
loan to the first respondent from Mettle Secured Property Finance
(Pty) Ltd, which amount may not exceed R1 900 000;
3.
An amount of R2 500 000.00, or a portion thereof within 60 days of
the settlement of the loan of Mettle, referred to in 2 above.
The
advance of the sums set out above, are subject to various conditions
set out in the agreement.
[7]
Clause 5 of the loan agreement provides that the borrower (first
respondent) shall pay the full outstanding capital sum, in
respect of
each amount advanced, without deduction or set-off of any nature in
case by the payment date. "Payment date"
is defined in the
loan agreement as within a period of 9 months calculated from the
draw down date.
[8]
Clause 11 provides that in the event of the first respondent failing
to make any payment of any amount owing on due date, the
full amount
of all the capital sums outstanding, whether due or not, shall become
payable.
[9]
In terms of a Certificate of Indebtedness, issued in terms of clause
13.1 of the loan agreement, the first respondent is indebted
to the
applicant in the following amounts:
1.
In respect of the first draw down of R4 100 311.63, an amount of R6
106 535.53, as at 28 March 2008, being 9 months from the
date of draw
down, together with interest thereon at the rate of 1.5 percent per
week from 28 March 2008 to date of final payment;
2.
In respect of the second draw down of R500 000.00 an amount of R779
084.82 as at 10 April 2008, being 9 months from the date
of draw down
together with interest thereon at the rate of 1.5 percent per week
from 10 April 2008 to date of final payment;
3.
In respect of the third draw down of R5 050 000.00 an amount of R7
529 910.71 as at 19 April 2008, being 9 months from the date
of draw
down together with interest thereon at the rate of 1.5 percent per
week from 19 April 2008 to date of final payment.
The
total indebtedness is therefore R9 650 311.63.
[10]
The respondents do not dispute that the applicant had complied with
its obli-gaions in terms of the loan agreement and that
all the
conditions precedent have been met.
[11]
The applicant alleges that the first respondent breached the loan
agreement by failing to pay the amounts advanced together
with
interest thereon when the repayment of the first advance became due
on 27 March 2008, or on any other date thereafter. The
respondents do
no assert that the first respondent had made any such payments, but
claim that the amounts are not due.
[12]
The second respondent, Mr Dawid Cornelius Maree, deposing on behalf
of the respondents, contends that it was the "parties'
express
understanding" that the loan finance would only be repaid after
the conclusion of the second phase of the development.
He says that
he is "flabbergasted" by the applicant's suggestion that
the amount are already due and payable. He says
the "simple
reason" why the amounts are only due upon completion of the
second phase is that Imperial Bank (now Nedbank)
was the main
financier of the development and held a first mortgage bond over the
property. He says that "obviously"
the proceeds of the
first phase would be utilised to extinguish the first respondent's
indebtedness of Imperial Bank.
[13]
Mr Maree says that the current status of the development is the
following:
1.Township
approval has been obtained;
2.
The township has been duly registered with the Dees Office on 2
September 2010;
3.
The township is ready to be proclaimed by advertising the
proclamation in the Government Gazette;
4.
All section 7(6) approvals have been issued in respect of the
building plans and "simply need not be reinstated.
[14]
Mr Maree says that it appears from the above that the first
respondent is "on the verge of procuring and commencing with
the
second phase of the development." It is not clear from the above
whether it refers to the status of the whole development
or only that
of the second phase. It is, however, clear that the second phase,
which involves the development of 189 residential
units, is very far
from completion. It has not even started. Mr Maree continues to set
out various problems that the first respondent
experienced with the
development of the first phase, and it seems that not even the first
phase has been completed.
[15]
To argue that the repayment date of the loan is other than what has
expressly been set out in the loan agreement itself is
rather
audacious. It is not necessary to repeat the trite legal principles
relating to status of a written agreement. It is the
sole memorial of
the agreement between the parties and they are bound by the terms
thereof. If a party contends that the agreement
does not reflect the
intention of the parties, he/she must apply for rectification of the
agreement. No such application has been
made or is even envisaged in
the papers. There is no legal basis upon which a court can interpret
the agreement in a manner that
is completely at odds with its
expressed wording.
[16]
Mr Viloen argued that there are serious factual disputes between the
parties that can only be resolved on trial. He suggested
that these
factual disputes relate to the question whether the agreement stands
to be rectified. However, there is no application
for rectification
that can be referred for oral evidence or trial.
[17]
I therefore find that the first respondent is liable for the amount
claimed.
[18]
This brings me to the claim against the sureties, the second, third
and fourth
respondents.
[19]
Mr Viljoen argued that the suretyship falls foul of the provisions of
the General Law Amendment Act, 50 of 1956. I have dealt
with this
same submission in a related matter under case number 49040/2010. In
that matter the fourth respondent was the first
respondent and the
principal debtor in terms of a similar loan agreement. The second and
third respondents were sureties.
[20]
My judgment on this issue was the following:
"S
6 of the General Law Amendment Act, 50 of 1956 reads as follows: "No
contract of suretyship entered into after the
commencement of this
Act, shall be valid, unless the terms thereof are embodied in a
written document signed by or on behalf of
the surety: Provided that
nothing in this section contained shall affect the liability of the
signer or an aval under the laws
relating negotiable instruments."
[6]
I fail to understand this submission. There are two essential
elements that must be embodied in the agreement:
1.
the identity of the creditor, the surety and the principal debtor;
and
2.
the identification of the principal debt
[7]
The first of the two essential elements appears from the suretyship
agreement.
[8]
Although the amount of the principal debt is not contained in the
agreement, it may be established by supplementary extrinsic
evidence,
such as a certificate as stipulated in clause 3.7.
2
[9]
i therefore find that the deed of suretyship complies with s 6 of Act
50 of 1956:
[21]
I stand by that finding.
[22]
Mr Pretorius for the applicant has prepared a draft order. I
incorporate that draft order as my order in this matter, it is
marked
"X".
J.
HIEMSTRA
ACTING
JUDGE OF THE HIGH COURT
Date
heard: 2 December 2011
Date
of judgment: 10 January 2012
Counsel
for the applicant:Adv. J.F. Pretorius
Attorney
for the applicant: Sim & Botsi Attorneys, c/o Gross Papadopuio &
Ass.
Counsel
for the respondents: Adv. J.C. Viljoen
Attorney
for the respondents: Le Roux & Du Plessis Attorneys
1
Barlows
Tractor Co (Pty) Ltd v
rownsencf
[1996] ZASCA 3
;
1996 (2) SA 869
(A) at 884F-G,
Nedcor
Bank Ltd v Samuel
2005
(2) SA 439
(W) at 441;
Millman
N. O. v Koetter
1993
(2) SA 749
(C)
2
Sapirstein
v Anglo African Shipping Co (SA) Ltd
1978
(4) SA 1
(A) and the cases cited therein;
Du
Toit v Barclays Nasionale Bank Beperk
1985
(1) SA 563
(A); Harms,
Amler's
Precedents of Pleading
7
th
ed at p 367