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[2012] ZAFSHC 42
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Mkentane v Motor Finance Corporation (Pty) Ltd t/a MFC in re: Motor Finance Corporation (Pty) Ltd t/a MFC v Mkentane (4217/2011) [2012] ZAFSHC 42 (16 March 2012)
FREE
STATE
HIGH
COURT, BLOEMFONTEIN
REPUBLIC OF SOUTH AFRICA
CASE NO. 4217/2011
In the matter between:
In the matter between:
BUSISIWE MKENTANE
…................................................................
APPLICANT
and
THE
MOTOR
FINANCE CORPORATION
(PTY)
LTD t/a MFC
…....................................................................
RESPONDENT
IN RE
THE MOTOR FINANCE CORPORATION
(PTY)
LTD t/a MFC
…..........................................................................
PLAINTIFF
and
BUSISIWE MKENTANE
…...............................................................
DEFENDANT
CORAM:
NAIDOO, AJ
HEARD ON:
2
FEBRUARY 2012
DELIVERED ON:
16
MARCH 2012
NAIDOO AJ
[1] This is an application for rescission of a
default judgment granted against the applicant on 27 October 2011.
The applicant
also seeks the setting aside of a warrant for the
delivery of goods, issued on 3 November 2011 and a costs order
against the respondent
[2] The applicant entered into an instalment sale
agreement (the agreement) with the respondent in terms of which she
purchased
a motor vehicle, which was delivered into her possession
The applicant failed to make due and punctual monthly payments in
accordance
with the agreement. The applicant applied for debt review
in terms of the National Credit Act 34 of 2005 (the NCA), but after
effluxion
of the time periods allowed in the NCA the respondent
terminated the debt review process in terms of section 86(10) of the
NCA,
and instituted action against the applicant for, amongst other
things, confirmation of the cancellation of the agreement, the
attachment
of the motor vehicle and leave to apply for damages, if
necessary.
[3] Default judgment was granted against the applicant in this
Division, and a warrant for delivery of goods was issued as indicated
in paragraph [1] above, causing the applicant to iaunch this
application.
[4] It is common cause that the agreement cites
the respondent as indicated above. It is also common cause that the
heading of the
summons cites the respondent in the same way, namely
"The Motor Finance Corporation
(Pty) Ltd t/a MFC",
whereas in the
body of the summons and particulars of claim, the respondent is cited
as
"The Motor Finance Corporation
(Pty) Ltd t/a MFC, a division of Nedbank Limited".
It
is furthermore not disputed that the notice in terms of Section
86(10) of the NCA also cites the respondent as a division of
Nedbank
Limited.
[5] The applicant contends that in view of the
respondent and Nedbank Limited (Nedbank) being separate legal
entities with "separate
and distinguishable iegal personae",
the respondent cannot be a division of Nedbank. She consequently
contends that she did
not enter into the agreement with the entity
described as
"Motor Finance
Corporation t/a as MFC, a division of Nedbank Limited".
It
is also the applicant's case that the agreement is subject to the NCA
and that the respondent, prior to instituting action against
her, did
not comply with section 129 of the NCA after delivery of the notice
in terms of section 86(10) of the NCA. In the circumstances,
the
applicant contends that the default judgment ought not to have been
granted against her. The applicant, furthermore, raised
a point
in
limine,
disputing the authority of the
deponent to the respondent's opposing affidavit to depose to such
affidavit. She contended that there
is no resolution of the
respondent company granting such authority to the deponent, Mr Van
Rooyen, to oppose the application.
[6] The respondent's answer to the applicant's contentions is that
Nedbank acquired the assets of Imperial Bank which had previously
entered into a Master Discounting Agreement (MDA) with Motor Finance
Corporation (Pty) Ltd t/a MFC (MFC). Thereafter Nedbank, Imperial
Bank and MFC entered into an Addendum to the MDA, in terms of which
Nedbank became a party to the MDA, acquiring the rights and
obligations that Imperial Bank had in respect of MFC, and which were
ceded to Nedbank by imperial Bank. Nedbank successfully applied
to
the Registrar of Banks for
transfer of the assets and liabilities of Imperial Bank to
Nedbank,in terms of section 54(1) of the Banks Act 94 of 1990
use of the names and brands currently used by
Imperial Bank, in terms of section 22 of the Banks Act, which
Nedbank was permitted
to use in conjunction with its registered
name, pending full implementation of Nedbank's revised brand
strategy. These names
include "Imperial Bank", "Motor
Finance Corporation" and "MFC"
restructuring of the companies within the Nedbank
group, in terms of section 55 of the Banks Act. In the circumstances
the Respondent
contends that it has
locus
standi
to pursue this action against
the applicant.
[7] The respondent also raised as a point
in
limine
that the applicant's founding
affidavit was not signed by the applicant or commissioned in terms of
the provisions of Government
Gazette No. R 1258 of 21 July 1972. In
her answering affidavit, the applicant explained that due to an
oversight by a first year
law student who was
temporarily
employed' by the applicant's legal representatives, an unsigned copy
of the papers was served on the respondent's legal
representatives.
The papers in the court file were properly signed and commissioned.
This point was not pursued by the respondent
and it need not detain
us further.
[8] In answer to the applicant's contention that
Mr Van Rooyen lacked authority to oppose the application, a
confirmatory affidavit
was handed up at the commencement of the
hearing of this matter. Mr Van Rooyen alleges that as Legal Manager
of the Respondent,
he is mandated to authorise High Court
applications and to sign affidavits on behalf of the respondent. He
is therefore authorised
to oppose this application. Mr Van Rooyen
further alleges that his mandate is contained in a document titled
"Collections
and Recoveries Mandates" dated 22 February
2011. Attached to his confirmatory affidavit was one page titled
"Collection
and Recoveries Mandates, Legal. Asset Disposal,
BDWO, OPS, NCA. Beneath that is a grid reflecting various job
titles, with signatures
and dates under each job title. The
identities of the various signatories do not appear on this
document.
[9] Not surprisingly, the applicant objected to
this annexure to the confirmatory affidavit, arguing that it gives
no insight
into what it purports to be and that the grid, with the
information I have alluded to. is meaningless. It cannot therefore,
be
regarded as authority for Mr Van Rooyen to oppose this
application.
[10] I will deal with this aspect first. A
similar point was raised in the matter of
Unlawful
Occupiers,
School
Site
v City of Johannesburg 2005(4) SA 199 (SCA),
where
it was contended that the municipality had failed to prove that the
deponent to its founding affidavit had the necessary
authority to
institute the application on its behalf. The learned judge, Brand
JA, in holding that this issue had been decided
conclusively in the
case of
Eskom v Soweto City Council
1992(2) SA 703 (W),
cited with approval the dicta of Fleming DJP (as he then was) at
page 705 D-H:
'The care displayed in the past
about proof of authority was rational. It
was inspired
by the fear that a person may deny that he was party to litigation
carried out in his name. His signature to the
process, or when that
does eventuate, formai proof of authority would avoid undue risk to
the opposite party, to the administration
of justice and sometimes
even to his own attorney....
The developed
view, adopted in court Rule 7(1), is that the risk is adequately
managed on a different level If the attorney is
authorised to bring
the application on behalf of the applicant, the application
necessarily is that of the applicant. There is
no need that any
other person, whether he be a witness or someone who becomes
involved especially in the context of authority,
should additionally
be authorised. It is therefore sufficient to know whether or not the
attorney acts with authority.
As to when and how the
attorney's authority should be proved, the Rule-maker made a policy
decision. Perhaps because the risk
is minimal that an attorney will
act for a person without authority to do so, proof is dispensed with
except only if the other
party challenges the authority. See Rule
7(1)"
The learned judge Fleming DJP continues at page 706
B-D:
"If the
applicant had qualms about whether the "interlocutory
application" is authorised by respondent, that authority
had to
be challenged on the level of whether [the respondent's attorney]
held empowerment. Apart from more informal requests
or enquiries,
applicant's remedy was to use Court Rule 7(1). It was not to hand up
heads of argument, apply textual analysis
and make submissions
about the
adequacy of the words used by a deponent about his own authority".
[11] The
Eskom
case
was also referred to in
Ganes and
another
v
Telecom
Namibia Ltd
2004
(3)
SA
615
(SCA),
which Mr Tsangarakis, for the
applicant, referred me to. In
Ganes,
the learned judge Streicher JA said at
page 624 l-J, and 625 A
"in any
event, Rule 7 provides a procedure to be followed by a respondent
who wishes to challenge the authority of an attorney
who instituted
motion proceedings on behalf of an applicant. The appellants did not
avail themselves of the procedure so followed".
I also align myself with the dicta in the Eskom case. If the
applicant in this matter wished to challenge the authority to oppose
this application, she ought to have availed herself of the procedure
prescribed in Rule 7 of the Uniform Rules of Court. In my
view, it
does not assist her to attack the authority of the deponent, Mr Van
Rooyen, to oppose this application
[12] I turn now to the issue of whether the
citation of the respondent in the summons relevant to this matter is
fatal to its
case. The respondent did indeed attach a number of what
appear to be complicated contracts and documents to its opposing
affidavit.
To my mind the purpose of these documents is to draw the
courts attention to the fact that there has been a transfer of
assets
and liabilities as well as rights and obligations from
Imperial Bank and MFC on the one hand
to
Nedbank on the other. The
respondent says, in so many words, that this is in fact what
transpired. The court is. furthermore,
indebted
to
Ms De Kock for her heads of
argument in which she gives a useful exposition of the provisions of
the Banks Act, which regulates
the transactions between Nedbank,
Imperial Bank and MFC. It is common cause that MFC and Nedbank are
two different entities with
separate legal personae. Once Nedbank
became a party
to
the MDA, it took the place of
Imperial Bank and therefore acquired the rights of MFC, effectively
divesting MFC of such rights.
[13] While Nedbank may have been granted
authority, in terms of the Banks Act, to "use the names and
brands currently used
by Imperial Bank, in conjunction with its
registered name, pending the full implementation of Nedbank's
revised brand strategy",
it is not clear whether "use"
can be interpreted to include instituting legal action for the
enforcement of its rights.
My view is that it is doubtful that the
meanina of "use" can be extended that far, as "brand
strategy' would seem
to suggest marketing and strategically
positioning the Nedbank brand in the relevant market. It is, however
not for this court
to traverse this issue.
[14] It would appear to me that Nedbank's acquisition of MFC's
rights would require it to institute any legal action to enforce
such rights in its own name, and not in MFC's name. While it has not
been specifically raised in the papers before court that
the
contract which MFC entered into with the applicant, and in terms of
which it acquired certain rights and obligations, is
subject to the
MDA, it would appear that this is in fact the case. In the
circumstances, Nedbank would have acquired those rights
and
obligations, and the summons in this matter may well have had to be
issued in Nedbanks name.
[15]
The requirements
of Uniform Rule 31(2)(a) are:
(a) The applicant must give a reasonable
explanation of his default and if it appears that his default was
wilful or that it was
due to gross negligence, the court should not
come to his rescue.
(b) The applicant must be bona fide in bringing
the application for rescission and must not make it with the
intention of merely
delaying the plaintiffs claim.
(c) The applicant must, set out a prima facie
defence, which if established at the trial, would entitle him to the
relief he seeks.
The applicant is not required to deal fully with
the merits of his defence, but should provide sufficient detail to
convince
the court that the probabilities favour his case. (See
Grant Plumbers (Pty) Ltd 1949(2) SA 470
(O); Colyn v Tiger Food Industries Ltd t/a Meadow Feed Mills (Cape)
2003(6) SA 1 (SCA)
at 9 D-E).
[16]
The applicant has
tendered an explanation for her default in this matter and I am
satisfied that her default was not wilful or
due to gross
negligence. Apart from putting the applicant to the proof of her
averments in this regard, the respondent does not
seriously take
issue with the explanation tendered by the applicant. The issues
raised by the applicant require ventilation and
tend to indicate
that her intention is not to delay the claim of the respondent. With
regard to the defences raised by the applicant,
it is noteworthy
that she is of the view that Nedbank does not have
locus
standi
in this matter. It must be
remembered that the agreements and contracts attached to the
respondent's opposing affidavit were not
within the applicant's
knowledge at the time she deposed to the founding affidavit, and
were not brought to her attention prior
to the filing of the
opposing affidavit. In view of Nedbank's status as a result of the
agreements between it and Imperial Bank,
and in view of what I have
said in paragraphs [12], [13] and [14] above, I am satisfied that
the applicant has an arguable case
and that if she is able to
establish that the plaintiff as cited in the summons has no
locus
standi,
she will be entitled to the
relief she seeks.
[17] In view of what has been said, it is not necessary for me to
deal with the applicant's contentions with regard to the
respondent's non-compliance with the NCA.
[18]
I, accordingly,
make the following order:
1. The default judgment granted by this court on 27 October 2011 is
hereby rescinded;
2. The warrant for delivery of goods issued on 3 November 2011
against the movable property, namely a 2005 Volkswagen City Life
1.6
with engine number AFX077220 and chassis number AAVZZZ17Z5U024221 is
set aside;
3. The respondent is ordered to pay the costs of this application on
a party and party scale.
NAIDOO,
AJ
Counsel for Applicant:
Adv
S Tsangarakis
Instructed by:
Botha
& De Jager
71 McHardy Avenue Brand wag
Bloemfontein
Counsel
for the Respondent:
Adv D De Kock
instructed
by:
Matsepes Incorporated
26/28 Aliwal Street
Bloemfontein